McGrew: FDE strategy succeeds by growing contract sizes rather than cutting customization
Bob McGrew · The FDE Playbook for AI Startups with Bob McGrew · Y Combinator · Sep 8, 2025 · at 36:26
Former Palantir executive Bob McGrew contrasts traditional SaaS scaling heuristics with the forward deployed engineering model on Y Combinator's podcast.
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“In the product market fit strategy, you want to be doing less work for every customer, you want to be driving down costs, you want to keep the contract size the same. In the FTE strategy, you want to drive the contract size up. So you're doing more and more valuable work for this customer and also for future customers. And because you're doing more valuable work, it's okay. You can leave the amount of customization you do per customer the same.”
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