S 02 | Ep 11 Owning the Problem: Christopher Lochhead on Why the Best Product Doesn’t Win | Transcript (AI-generated)

See show notes for this episode: S 02 | Ep 11 Owning the Problem: Christopher Lochhead on Why the Best Product Doesn’t Win | Show notes 

0:00:01 - Alex Shevelenko
Today's guest is the only person I know who can make CEOs pivot, investors sweat their portfolios, and marketers torch their entire playbook — all before breakfast.
He's a three-time public company CMO, the best-selling author of Play Bigger, Niche Down, and his latest, The Existing Market Trap.
He's also the godfather of category design and host of Follow Your Different.
In short, he's the Gordon Ramsay of business — blunt, brilliant, and guaranteed to tell you your strategy tastes like dog food.
He doesn’t often do podcasts, but when he does, they’re unforgettable.
Chris Lochhead, welcome to the show.

0:00:59 - Christopher Lochhead
Thanks, Alex — that was great. I’ll take the Gordon Ramsay comparison all day.
Actually, it’s funny you say that because I’ve been to Hell’s Kitchen in Vegas a few times, and one of the amazing things about what he does there — actually, there are several — is that he’s got pictures of many of the chefs who’ve been on the show, and I guess he features many of them in his restaurants.
I don’t know; I’m not an expert in this field. But it’s very cool that he’s celebrating all these other chefs. And, you know, he’s a category king, right? He and a handful of others designed this whole category of “celebrity chef” here in the United States. The fact that he celebrates other chefs is really cool.

And then the other thing is, if you go into most chain restaurants — and I know his is a high-end, boutique-y chain, but still a chain if you will — there’s usually no love.
My favorite restaurants where I live are the ones where I know the owners and the chefs, and the level of “give a fuck” is really high.
So you don’t expect that in a restaurant in Vegas, but I’ll tell you — the food is off the chain, the service is excellent, and the level of “give a fuck” is very high at Hell’s Kitchen, at least in Vegas.

Years ago, I took my mother to Vegas for the first time to see Cher, and we’re going back this fall. The first thing she said she wanted to do was go to Hell’s Kitchen — so I’m taking my mom there for the first time.

0:02:35 - Alex Shevelenko
Looking forward to that. Well, it’s interesting that we’re on this food metaphor, because one of my other favorite business communicators — Steve Jobs — has a quote I repeat to my team regularly.
It goes something like: “You guys baked a beautiful cake, but for frosting, you covered it with dog shit.”

And that feels like a big metaphor for a lot of things in business. At our company, where we turn important ideas into consumable experiences, that’s kind of our metaphor — you have all this valuable stuff inside a PDF that nobody wants to read.

In the broader sense, a lot of people work on brilliant products or marketing tactics, but they don’t think from the very beginning about how to wrap it all together into a category that acts like a heat-seeking missile for the right audience. So they waste a lot of potential — and a lot of resources.

We’re living through that moment right now.
We actually did some research on this. So, tell our audience — did you see that?

0:03:51 - Christopher Lochhead
Did you see it?

0:03:59 - Alex Shevelenko
By any chance — this is the AI one. I’m happy to tell you: out of the $17 trillion invested globally in startups, around $13 trillion is going to be lost. Okay, got that statistic? Hold on.

0:04:21 - Christopher Lochhead
Okay, so what we’re predicting is that in the AI startup space — which represents a meaningful percentage of that investment number, as you’d expect — approximately $13 trillion will be lost in AI innovation and startups.

Of course, nothing is ever that simple, but one of the primary reasons is that those trillions are being given to innovators and entrepreneurs who are chasing existing markets — existing demand — with a “our carbodigulator is better than their carbodinulator” strategy.
And they’ll get crushed.

So yeah, we’re about to witness the largest destruction of startup investment in human history, because people are getting stuck in the existing market trap.

0:05:21 - Alex Shevelenko
And the way you describe it in the book — in your own language — is that you can quickly spot it. It’s the co-pilots, the bots, the assistants… they’re not the defining feature or the defining characteristic of a new business.

0:05:41 - Christopher Lochhead
Yeah.

0:05:42 - Alex Shevelenko
So how do we help people spot where the likely waste is going to be?

0:05:47 - Christopher Lochhead
Yeah, so — and I’ll say some things that some people might find… however they might find them — but I ask you to consider what I’m about to say.

Most people don’t think. What they do is retweet — in their head — something they agreed with. Something someone else said that they thought was smart. Most people don’t actually think about that thing; they just go, “Oh yeah, that sounds right,” and then they repeat it.

If you ask them why they believe it, most can’t answer more than once or twice.
If someone says, “I’m pro-choice” — let’s pick a hot topic like abortion — or “I’m pro-life,” or “I’m pro-Palestine”…

0:06:41 - Alex Shevelenko
Perfect, let’s go with “pro-Palestine” — I know that’s one of your favorites.

0:06:43 - Christopher Lochhead
Perfect, let’s go with “pro-Palestine.” I’m pro-Palestine, by the way.

0:06:48 - Alex Shevelenko
Yeah.

0:06:49 - Christopher Lochhead
I think if you give a shit about the people of Palestine, the number one thing you want is the end of Hamas.
For example, most people don’t understand that approximately 40% of the children born in Palestine are inbred. That’s because the human beings — and in particular the women — who live under Sharia law face some of the most oppressive conditions anywhere. It’s probably worst of all in Afghanistan. Under Sharia law, they can marry women under 18, and they encourage marrying — and I’m putting “marrying” in air quotes — cousins and relatives. It’s actually rape, not marriage.

So forget all about the current situation with the war for a second.

0:07:47 - Alex Shevelenko
You just look at it and go...

0:07:49 - Christopher Lochhead
What’s going on in this society? What’s going on in this culture?
You have a culture that is arguably the most oppressive to women on planet Earth.

We hear these things about “Queers for Palestine.” Well, yeah — there are no queers in Palestine, because they get thrown off buildings. They “marry” girls they’re related to, and those girls have children who grow up with horrible medical conditions.

All you have to do is go on the internet and ask your favorite AI: what does a person who is inbred suffer from in their life?

Anyway, my point is this — most people say, “Oh, I’m pro-Palestine.” Great. I’m pro-Palestine too. I have Palestinian friends. I want the people of Palestine to shine. I want there to be freedom, equal rights for women, children, and gay people in Palestine. I want Palestine to thrive the way Israel has.

There’s no tech entrepreneurship in Palestine. Israel, this tiny country of less than 10 million people, is number two in the world — second only to the United States — in tech startups. My dear friend Giora Yaron is one of the founders of what’s now called “Startup Nation” in Israel.

So how is it possible that in exactly the same geography — we’re talking New York to New Jersey at best — one culture is thriving and another isn’t? Well, some of the problem (not all) is the ethos of the culture. Anyway, most people don’t think about that.

In category design, we teach people to think.
As a matter of fact, we specifically teach people how to think. Category design is about creating different futures — different futures of massive value.

You and I are living in a different future right now. We’re on a technology called Zoom. The person who built this product — who made this technology possible — is a guy named Eric Yuan. I know Eric. He’s been on my podcast, he’s been to my house. He’s a wonderful man, an immigrant to this country from China, and he’s done an incredible job. He created a different future where you and I could have meetings over the internet and on our phones.

We’re now living in a different future that Eric created.
So if you’re going to create different futures, how do you have to think?

Well, the first aha moment is this: we teach category designers to reject the premise. Because the competition is not a company or a product — the competition for people who are category designing different futures is the status quo.

That’s right. So if you’re going to create a different future, the first thing you have to do is reject all the thinking that created the status quo, and try — as best as possible (it’s impossible for humans to do completely, but still) — to think in unconstrained ways.

Let’s go back to Eric for a second.

0:11:16 - Alex Shevelenko
Obviously there were other web conferencing tools — in fact, he had built one before, at the time he was creating Zoom.

0:11:24 - Christopher Lochhead
He was the head of engineering for WebEx, and I think he was in — if I remember right — the first 20 people hired at WebEx.

0:11:35 - Alex Shevelenko
So even despite that, his competitor wasn’t WebEx. His competitors were all the people who weren’t using or succeeding with WebEx because it just wasn’t delivering the quality of conversation they needed. Is that how we should think about it?

0:11:51 - Christopher Lochhead
Yeah, so that’s a product issue — which is very important. Product matters.
But what he did that was genius was this: he built mobile first.

WebEx sucked on mobile — probably still does. I don’t know who the hell uses WebEx anymore.

The genius of Eric Yuan is that he redesigned the category around mobile first. And Zoom, normally — unless you have a hiccup (which happens) — is a one-click-and-you’re-in experience. You don’t have to sign into anything.

0:12:31 - Alex Shevelenko
So he reduced all that friction.

0:12:33 - Christopher Lochhead
Exactly — he reduced all friction. And, most importantly, he realized: if people are having mobile cloud meetings, maybe they’re actually mobile.
And WebEx missed it.

0:12:47 - Alex Shevelenko
He redefined mobility — because back then, “mobility” meant, like, “Here’s my laptop, I’m moving it,” right?

0:12:56 - Christopher Lochhead
Exactly — “I’m walking around with my laptop.”

And here’s the craziest thing of all. He told me this personally on my podcast: he had these ideas while he was working at WebEx. After it was acquired by Cisco, he was still head of engineering.

When the acquisition happened, he went to his bosses and said — and these are my words, not his, I’m paraphrasing — “We’re sort of screwing it up. We’re not on the cloud, and most importantly, we’re not mobile first. We’ve got to rebuild the product from the ground up.”

And they basically patted him on the head and said, “Hey, why don’t you shut up and focus on the next release?”

0:13:33 - Alex Shevelenko
So you know what he did?

0:13:35 - Christopher Lochhead
He threw a party.
He threw a party at his house with a bunch of rich people and said, “I’m going to leave because these guys are dumb and they don’t get it.” Again, my words — he’s much politer about it.

He raised a whole bunch of money from those rich friends in Silicon Valley, started Zoom, and left.
And, by the way, he never had to raise any more money. The subsequent rounds of financing — all the way up to the IPO and beyond — he didn’t need any of it.

He became cash-flow positive on the money he raised at that party.

0:14:11 - Alex Shevelenko
So if we go back to that example and the problem you pinpointed — the experience was horrible on mobile, not great in general — and yet smart people at WebEx, stuck in their existing paradigm, didn’t measure the potential and value around the experience that Eric proposed.

Because I think a lot of your examples of new categories start somewhere — creating the kind of experience that draws in customers who are willing to try it. Right? The category doesn’t exist yet, the product doesn’t exist yet, but somebody designs something so awesome that people are drawn in.

So how do we measure that experience before the revenue impact of it? Before we know Zoom is a success?

0:15:09 - Christopher Lochhead
So we start with the thing that matters most — and that is: what’s the problem we’re solving, for whom are we solving it, and how is that problem different, or how are we solving it in a different way?

There are only two kinds of problems: known problems that have some kind of solution, and problems that are unknown or unacknowledged — but once they’re acknowledged, people can’t unsee them. Right?

You and I didn’t have a problem called, “How do I charge my smartphone in my car?” before smartphones. And today, if you buy a modern car, many of them have a little platform right under the dash where you can wirelessly charge your phone.

So my point is — that was an unknown problem.

New categories create new categories. Smartphones, led by Apple, came out. People wanted to charge in the car, and somebody smart said, “How do you charge your smartphone in the car if you don’t have a wire?” They figured it out, and now it’s standard in many modern cars. That’s a new problem.

Purell was a new problem. The entire soap industry thought they had it right. The problem definition — the status quo in soap — was: you have dirty hands, you want to clean those hands, the answer is water and soap. That was true for 100-plus years.

0:17:13 - Alex Shevelenko
I remember those bars. They were so nasty.

0:17:16 - Christopher Lochhead
Nasty as fuck — because we shared them. They were full of hair and things.

0:17:21 - Alex Shevelenko
Right — they cracked, right? They cracked.

0:17:30 - Christopher Lochhead
Exactly. And so the folks at Gojo Industries — who category-designed the liquid soap market as distinct from the bar soap market — did that about 80 years later. Then somebody really smart, focused on the problem, asked a different — and I use that word on purpose, Alex — question: “How do I wash my hands in the absence of water?”

Nobody had a problem called “I want to wash my hands without soap and water.” That question hadn’t been asked. It wasn’t even considered a problem.

And today there are many parents who won’t leave the house without Purell, because they bathe their kids and themselves in it wherever they go.

A whole new category called hand sanitizer — cleaning your hands in the absence of water — was born.

Gojo Industries continued to succeed by continuously thinking about the problem of clean hands, and being smart enough to reframe that problem.

So one of the first things we teach category designers is: the way to win is to frame, name, and claim a problem.

We hear a lot of talk, especially in our world — the tech world — where people go, “Oh, you need a moat. What’s your moat? How do we build a moat?”

Well, the greatest moat in the world is owning the problem.
Because she who owns the problem becomes the solution.

When you say “Google it” — that’s the moat.

0:19:15 - Alex Shevelenko
That is a method — yeah, retrieving information.

Yeah, no one’s saying “Perplex it” yet.

But let’s shift a little — from the 80-year-old world to today — what you cover in your latest book, where the pace of innovation is a bit overwhelming for most people.

For consumers — and that’s actually the biggest problem — they’re not ready to change their habits at the pace that innovation allows them to.

But also for folks like us — everything’s changing so fast. How do you keep up with it? Can you change your category every three months without losing it?

What’s your take on what’s happening? Because there’s a rush — people who’ve read your work and love your work still find it pretty hard to stay on top of things, especially if they have limited resources to figure it out.

0:20:20 - Christopher Lochhead
Perfect, perfect, perfect. So did you hear what you just said?

0:20:30 - Alex Shevelenko
Limited resources — part of it, or just before that? Staying on top of it?

0:20:36 - Christopher Lochhead
You said, “It’s pretty hard to stay on top of it.” Yes. What’s the it?

0:21:10 - Alex Shevelenko
It? Yes, what's the "it"? The velocity of change in the industry is such that, especially in horizontal, highly competitive markets with competent or relatively competent incumbents, innovation — definitely in product, and I think in category to a lesser degree — is rapidly copied. So the time to ride the wave feels like it's shrinking, and things that could come out changing expectations seem to be popping up at a higher pace than, for example, when we were going through the SaaS revolution, where you had time to change the category and adapt, and your competitor wouldn’t copy you right away.

0:21:53 - Christopher Lochhead
Okay, so let's break that down. First of all, just off the top — back in the SaaS days, everybody said what you just said about SaaS. And back in the birth of the Internet, everybody said what you just said about AI and the Internet. And back in the beginning of the PC and client-server era, etc. So people are always saying, “Oh, the pace, the speed of innovation,” and so that’s always true — more important…

0:22:23 - Alex Shevelenko
I will, I will just disagree with the SaaS part, okay? I think the pace there — we were doing big innovations, you know, quarterly releases with Salesforce and SuccessFactors. Right now, we can do daily releases every second.

0:22:38 - Christopher Lochhead
Look, if you're building agents — look, the future is beginning to reveal itself, right? We’re moving toward an agentic future, where agents will be talking to agents and improving agents. Your job will be less about managing and leading people and more about managing and leading agents. So the agentic future is beginning to present itself.

But my point is — yes, it's a step function. It's an exponential change in the rate of innovation and new categories, no question about that. But it always feels that way when there’s a big new platform. When you’re in it, it feels like that. You adjust to the different speed and get with the program.

There’s another part, though, Alex, of what you’re saying that I really want to play with — “It’s hard to keep up with it.” Okay, so let’s do some thinking. Roger Martin, who many think is the greatest management thinker around today — the modern-day Peter Drucker, very smart guy — I’ve had him on the podcast a couple of times. And, you know, he talks a lot about thinking. So let’s do some thinking about that.

And we at Category Pirates say: thinking about thinking is the most important kind of thinking. It’s actually the first law of the 22 Laws of Category Design — it’s all about thinking.

So, “keeping up with it.” If you pull back from that statement, what that statement is really saying — the context it creates — is there’s this thing out there, the “it,” called the market or innovation, and it’s changing. Okay. Well, the first thing about that is: who’s changing it? Because it’s not changing by itself.

Most people treat markets like the weather. And I will assert to you here — let me just read this. So NVIDIA announces their quarter. Okay, perfect. This is August 28th, 2025, Wall Street Journal: “Even NVIDIA Has Speed Limits.” Headline: “Strong AI Chip Sales Come Up a Bit Short for Markets; Only $4 Trillion Company.”

So, “Strong AI chip sales come up a bit short” — that’s what the subhead says. And then, NVIDIA’s data center segment revenue surged 56% year over year to a little over $41 billion in the recent quarter. And then it says NVIDIA’s outlook remains strong.

The interesting thing about this is that The Wall Street Journal treats markets like the weather. They say, “They had strong AI chip sales, but it came up a bit short for the market.” Okay — markets are not the weather. See, the weather just happens. If you fire up your browser or turn on your TV and look at the weather where you live, you’ll see, “Oh, it’s going to be 72 degrees and partly cloudy.” That’s a forecast of the weather, and, best I can tell — unless you believe some conspiracy theorists — we have no control over the weather. It just happens.

When we talk about markets like that — “NVIDIA had a great quarter because of strong AI demand,” as if NVIDIA was just sitting there — “tailwinds” is the most popular word, right?

0:26:50 - Alex Shevelenko
I’m just sitting here, hey man.

0:26:52 - Christopher Lochhead
I was sitting here on my mother’s couch in my mother’s basement, in my underwear, drinking Budweiser, playing video games — and all of a sudden, strong sales just showed up. That’s what Jensen was doing.

And here’s the aha. When entrepreneurs get this, they have a life-altering moment. In November of 2023 — which, if I’m not mistaken, is when OpenAI launched ChatGPT — or maybe it was 2022; if not, we can look it up — in October, the month before they launched, the sum total market for generative AI globally was zero. There was no demand, no problem to be solved, and no solution to be bought.

And then OpenAI launched. Most people think they launched a product — which they did — but what they really launched was a new category. A whole new, different category for how we use technology. And that category today is the fastest-growing category ever created by humans, and OpenAI is the fastest-growing startup ever created by humans.

And the month before they launched, total demand for what they do was zero. So what’s my point? Markets, just like products and companies, are things we can design.

0:28:43 - Alex Shevelenko
So, look, I’m one of your biggest fans, Christopher, so this is a privilege to test some of these ideas with you. But in the history of humanity, right — the French Revolution kicked off, something happened, one party, another party — and then there was a freaking mess, right? And the mess was, you could say, yeah, somewhat predictable because there were actors and they had opinions, but it was messy. It was this sort of Cambrian explosion of violence and terror and everything that was going on, right?

And so I think where my question was — there’s definitely this moment of truth with a new category unleashing everything. Perfect combination of UX, UI, velocity, consumer experience — brilliant. The market around it had enough competent people who started to embrace it, compete with it, go along, and it created a lot of moves that shook everything up. And you can’t really say there was this one event, this one company, this one genius that figured it out — and then the next thing was there.

So, my brother is Chief Business Officer at Perplexity. They came up with a great category competing with Google. At some point, maybe it’s a category, maybe it’s not — but now everybody has copied that, and they have to chase the new experience again. Even though it’s a great, successful company, the pace has increased.

0:30:21 - Christopher Lochhead
So I suppose the underlying question here is — here’s Perplexity’s problem. And I’m a fan — I use the technology, and, in the spirit of full disclosure, I have some of the stock. But that said, they get an F on category design.

0:30:38 - Alex Shevelenko
So they basically quickly designed a great product, but it wasn’t enough of a category. Is that your point?

0:30:43 - Christopher Lochhead
They didn’t even try to design a category. As a matter of fact, I’m trying to see — at one point, they were calling themselves something like “search” something. I don’t know what they call themselves now. Hold on — they’re saying it’s a free AI-powered answer engine. Yeah. But at one point, they weren’t calling it that; they were calling it something search-related. They were essentially positioning it as Search 2.0 — and that was their downfall.

0:31:16 - Alex Shevelenko
The irony is that they were damning — but hold on — they were, to use your metaphor, damning the demand from Google, right? Like, maybe they didn’t do a great job at it, but they valued themselves by—

0:31:30 - Christopher Lochhead
So you can damn the demand without calling yourself the other search. But the 2.0 — the moment you call yourself 2.0, you’ve already lost the game. You’re fucked. You’re already done.

0:31:41 - Alex Shevelenko
Okay, right. That’s really helpful. Or the moment you say, “I’m this on steroids,” which is another common phrase I hear — then you’re like, forget it, you’re done. Okay, because you’re playing a comparison game.

0:31:56 - Christopher Lochhead
There’s a simple exercise we do with category designers.

It goes like this: I’m going to ask you to think about something — just that one thing. Excuse me — I’m going to ask you not to think about something, and think about anything other than that thing. Okay: pink elephants, pink elephants, pink elephants. Don’t think about pink elephants. Think about anything you want — not pink elephants. Think about anything you want, anyone you want to think about — no pink elephants. Under no circumstances, pink elephants. What’s in your mind?

0:32:26 - Alex Shevelenko
A huge, huge body of pink elephants covering everything. I’m right here talking about pink elephants.

0:32:33 - Christopher Lochhead
The minute the idiots at Pepsi — and I say this on purpose — say, “We’re better than Coke,” four out of five people say, “Pepsi tastes better than Coke.” What’s in your mind? Coke. They might as well Venmo their fucking marketing budget to Coke.

Yeah. And so this is the mistake Perplexity made against Google. They were also fighting the wrong fight. The fight they needed to fight was: who is going to frame, name, and claim the new problem, and therefore the new solution? Their real competition for that was actually Claude and OpenAI — all the other AIs. They should have called themselves something radically different, like “Answer Engine Smart.” That would’ve been smart three or four years ago — less so now.

0:33:34 - Alex Shevelenko
Okay. So this is really interesting, right? Because when we were chatting earlier about SuccessFactors — where you helped us move away from the mediocre categories — and, by the way, it’s really funny to bring up the backstory. We were trying to improve the category in our best thinking at the time. We were like: performance and talent. It was employee appraisals, then goals and performance management, performance and talent — blah, blah, blah — and it just kept, like, basically describing the product suite versus redefining the end — you know, the end results.

0:34:20 - Christopher Lochhead
I hate to interrupt you, but that’s what most companies are — product-out. And category designers are problem-in. That’s right. So when I showed up at SuccessFactors, the problem seemed very obvious to me. And when I sat down with Lars to tell him about it, you could sort of see his mind expand, because it was sitting right under everyone’s noses.

But look, I’m an entrepreneur too — we all fall in love with our own stuff. As a matter of fact, we made the same mistake. Our new book starts off by talking about how this should have been the first book, because our first book is mostly about the solution — called category design. And while we talk about the problem that category design solves, we didn’t frame it, name it, and claim it. We didn’t take our own damn advice. Because we’re entrepreneurs too.

The belief that “the best product wins” is so omnipresent that even those of us who make a living doing category design launched the product first, not the problem. That’s why we wrote the prequel.

0:35:40 - Alex Shevelenko
So we were solution-first.

0:35:41 - Christopher Lochhead
Exactly. The number one mistake: solution first, solution first. Problem first, problem first. Okay, got it.

Right — and actually, to complete the story, one of the things I did with SuccessFactors back in the day, when the company was about performance and talent management and the growth rate was sort of stalling and the competitive landscape was getting tougher, was I said, “Well, walk me through the product — and specifically some of the new things that are coming.”

And you probably remember better than I do — there was a product for the executive suite that was called, if I’m not mistaken, something like “goal cascading” or something like that. So the CEO could create three to five key goals for the company for the quarter or the year, whatever it was, and then “cascade” that down. So that, if you were my boss and we were creating my personal plan for the quarter and how I was going to be evaluated, you would have the CEO’s goals there. And when you created my plan for the quarter, my plan had to tie to the overall corporate objectives. Remember this?

0:36:50 - Alex Shevelenko
Yeah, of course, of course.

0:36:52 - Christopher Lochhead
Okay, so… with that, I said to myself, okay, if goal cascading is a product or a feature, what’s the problem it’s solving?

0:37:04 - Alex Shevelenko
Execution.

0:37:06 - Christopher Lochhead
The company’s ability to execute.

0:37:07 - Alex Shevelenko
Yeah.

0:37:09 - Christopher Lochhead
Right, because if the CEO says, “These are the three goals,” then clearly what she wants the rest of the company to do is execute and produce the results to achieve those three goals.

0:37:24 - Alex Shevelenko
So it’s about execution. You could have the best culture in the world, but if it’s not driving toward the goals you set, it’s kind of like the HR…

0:37:33 - Christopher Lochhead
Oh, you mean nice people?

0:37:34 - Alex Shevelenko
Yeah, we’re great. Everybody loves working here. But if you stand back and ask yourself five to seven times…

0:37:41 - Christopher Lochhead
This goes back to thinking. It goes back to rejecting the premise, and it goes back to unshackling yourself from the way things are today. Ask yourself five to seven times: what is the real problem we’re solving? And that’s what gets you to the big aha. It’s not about performance appraisals or goals. It’s about — can the CEO produce the results every quarter? Can she align the company against those goals so that the company is clear on what’s needed and has the resources to achieve them?

0:38:16 - Alex Shevelenko
Right, because the biggest problem in business today is that most people don’t know what a result is. I’ll give you credit on two areas in particular, and I’ll challenge one area where maybe you could help us see the nuance between a junior buyer and a senior buyer.

The CEOs loved it. Obviously, this is CEO-level messaging. The HR leaders — who wanted to get to the board, knew where the board table was, and wanted to get there — if they got there, could communicate without screwing it up. They got it and got promoted. So that worked. The investors loved it. It helped us move the company public. Actually, I wrote an ebook on how to leverage your SAP investment — or at least salvage it — so that you get business value from it. That obviously helped with the acquisition. I think SAP liked it. They almost repeated the same playbook when they bought Qualtrics a few years later.

0:39:26 - Christopher Lochhead
But, by the way, do you know who did the category design?

0:39:28 - Alex Shevelenko
Well, of course I know that — it’s written in your book, right? So why do you think you’re here?

I just thought it was because my mom told me I’m incredibly handsome. Yeah, well, I have a face for podcasting, but anyway. Yeah, I could see you even shaved for this one. But I will tell you the challenge: there was a challenge with someone who was a mid-level HR decision-maker, let’s say in a mid-market company. They wouldn’t know what BizX was. If you hit them over the head with it, they were afraid of it. They were afraid of the price point. And still, with the suite we had, some of those buyers could go and buy beautiful performance appraisal software.

So I think there’s this tension: sometimes we design for the senior buyer or the investor community, but there’s still the existing buyer influencer — maybe a wannabe champion — who needs to be communicated to in the language they understand.

Help people navigate that, because I think I’ve often made the mistake of trying to create a brilliant category that nobody understood, except maybe for the people who read your stuff. Right? It obviously didn’t work. But even if it did, we’d still have the problem of connecting with people who are still living in the past with budgets, and we need to tap those budgets.

0:41:10 - Christopher Lochhead
Okay, good, I love this. So the first piece: the examples we’re on right now are B2B enterprise tech. We can talk about different markets if you want, but in that market, here’s the aha that most CEOs, most marketers, and most CROs don’t always get: the highest market cap companies in the history of B2B enterprise win in the C-suite. They win in the corner office.

Maybe when you’re starting out, you can create a micro-niche category that appeals to somebody lower down in the org chart, and they have spending authority to spend 20 grand or whatever.

0:41:59 - Alex Shevelenko
It is up to 20 grand, 10 grand, easy.

0:42:02 - Christopher Lochhead
You could build an SMB departmental solution — departmental, yeah — and that’s great. By the way, in SMB, you can be one of the most powerful companies in the world. I’m working with an AI company called Virtuous AI today. They’re creating AI for SMBs because SMBs are terrified that the Global 2000 is investing trillions in AI and they’re just going to get run over.

Right now, interestingly, startups and SMBs have a window — probably a 24 to 36 month window — where they can execute at a speed the S&P 500 cannot. Virtuous AI is building business AI for that startup and SMB world so they can gain a massive advantage by executing on AI more quickly.

0:43:07 - Alex Shevelenko
So I think this is… you can come back to — well, let’s come back to that, by the way — because I think the regulated industries and functions, which are probably half of the economy if not more, have a very tough time. And the other half, which is probably half of the economy if not more, also have a very tough time.

0:43:23 - Christopher Lochhead
And the other thing is governance. Right now, AI governance is the number one issue. The reason major investment banks and many S&P 500 companies haven’t embraced AI is because they don’t want all their proprietary intellectual capital being dumped into ChatGPT, which makes perfect sense.

If I’m Goldman Sachs and I’m writing an S-1 to take Rialto public and I want to collaborate with ChatGPT on that S-1, I’m going to dump the Goldman Sachs S-1 filing templates into ChatGPT. The whole world will have it then. So governance matters.

0:44:05 - Alex Shevelenko
Morgan, we’re going with Morgan.

0:44:06 - Christopher Lochhead
All right, excellent. Transparency matters a lot, etc., etc.

0:44:13 - Alex Shevelenko
But that said, we were on enterprise. So to come back to this: you don’t win in the enterprise unless you win in the corner office. Period.

0:44:23 - Christopher Lochhead
End of discussion. Yes, you can build a several-hundred-million-dollar company at the $20,000 level if you really get it right — departmental or whatever. But ultimately, if we go back to SuccessFactors, where we met Lars, I’ll never forget Jay Larson, effectively the number two guy in the company. He said to me when he first called to introduce me to Lars — and I have a great relationship with Jay, I love him, respect him deeply, we’ve been in lots of foxholes together — I asked him, “Jay, why are you calling me? What’s the problem?”

He said, “I’ll tell you in the simplest way: our current sales deck is the fastest way to get kicked out of the C-level office and pushed down into the bowels of HR.”

Right, so he knew it. You have to matter in the corner office. If you’re in B2B and want to sell at any meaningful level — hundreds of thousands or millions of dollars in sales — nobody’s going to spend a million or more dollars annually on software unless a senior person with a C in their title has a conversation with meaningful spending authority. That’s the first piece: you’ve got to understand that.

The second piece: most companies waste a ton of time selling to people who can only say no. You’ve got to get up the org chart to the people who can make the decisions. That doesn’t mean the people who can make recommendations but can’t say yes aren’t important — they’re important influencers, and getting them on your side matters. Absolutely. The CEO will turn to a top technical person and ask, “Did you check this?” or “Are you sure?” They’ll ask tough questions, and there better be good answers. Those people matter, but winning in the corner office is step one.

Step two: when you’re creating a complex B2B category, what you’re building to communicate is a POV — a point of view. A POV is simple but powerful: you frame, name, and claim the problem. Then you position the solution. By the way, if you do the problem right, the solution becomes obvious. That’s why we say spend 80% of the time on the problem.

Market, the problem. Market, the problem. The solution speaks for itself. Another interesting thing about this: there’s a weird cognitive bias in humans — when someone articulates a problem more effectively than anyone else, we assume they have the answer. We don’t ask, “How do you solve it?” We just assume they know because they understand the problem.

So the POV frames, names, and claims the problem, positions the solution, and then shows how to go from problem to solution. Think of that as a framework, an accordion: at the C-level, you only discuss high-level items and maybe a few details. The lower you go in the org chart, the more you have to open the accordion.

0:47:57 - Alex Shevelenko
Pick and choose which parts of the accordion you want to emphasize, depending.

0:48:01 - Christopher Lochhead
The CEO is probably not going to ask you whether you’re hosted on AWS or not. That’s probably not going to happen.

0:48:08 - Alex Shevelenko
Well, you know, I started at Microsoft, and Ballmer and Gates were famous for actually drilling down to see if people did their homework. Well, sure — smart CEOs do that.

0:48:24 - Christopher Lochhead
The smart CEOs do that to some degree, but you’re absolutely right — that’s the accordion again. So, as part of your POV and as part of how you train your product folks, your SEs, and obviously your sales folks — and now your agents, because make no mistake, we’re moving into a world where agents are doing more and more sales.

As a matter of fact, I saw this just recently — let me grab this for you, Alex, because this is a wake-up call for all the donkeys who say AI is not happening. Salesforce publicly announced that they used AI to replace 4,000 customer service folks.

0:49:10 - Alex Shevelenko
Yeah.

0:49:11 - Christopher Lochhead
So anything that’s a repeatable process is going to be solved by AI — specifically by agents tapping into LLMs. That’s where we’re headed.

You’ve got to be able to develop your category design, and if you have a complex B2B sale, you’ll need to have different conversations that are anchored deeply to your category POV at different levels of the organization. You’ve got to be able to walk and chew gum at the same time.

0:49:52 - Alex Shevelenko
So let’s tackle another topic — one of the sins you cover in your latest book — building a horizontal tool. When I read that chapter, I was like, “Oh, I intellectually knew it,” and I still did it when I started building our platform, partly by virtue of customers pulling us in different directions. But I wasn’t definitive enough in narrowing it down, and I ran into all sorts of problems.

So I want your perspective — something you could share with our audience. What does that mean? This is probably the opposite of the enterprise folks, right? In this sort of no-code or flexible tool world, these tools can do everything for everyone. What’s the risk for a business if they go down that route?

0:50:47 - Christopher Lochhead
The horizontal tool problem, simply stated, is that product and engineering folks — and often sales folks — don’t want to get pinned down. The engineering folks want to build whatever the hell they want, and the sales folks want to walk into a customer and say, “Oh, what do you have budget for? Yeah, we do that.”

0:51:08 - Alex Shevelenko
Nobody wants to settle down. Nobody wants to get married.

0:51:11 - Christopher Lochhead
Exactly — nobody wants to get married and have kids. They want to freeball all over the place, play the game. And they get crushed as a result.

A simple example is my friends at Splunk. Splunk did an unbelievable job of category design in the beginning, primarily around unstructured data — or “data lakes,” as some people called them. But this was a company that fell into the horizontal tool trap. They rode their initial category success, but then, as the category evolved — to your point earlier — new startups like Datadog, Databricks, and others emerged. There was one more… I’m forgetting.

0:52:03 - Alex Shevelenko
Snowflake. Snowflake, thank you.

0:52:04 - Christopher Lochhead
Yes, Snowflake — that’s the one. These companies moved the category into a new and different place. They stole the agenda from Splunk. They stole the category — which is what happens when someone reframes your problem, makes your problem less relevant, and makes their problem the higher-order bit. That’s exactly what Snowflake did.

0:52:29 - Alex Shevelenko
So basically, like Legos — “Hey, I have a set of Legos.” It’s a hard category to maintain.

0:52:37 - Christopher Lochhead
Exactly. You want to build a house, a car, a person — it’s impossible. Splunk’s market cap stalled, and they ultimately got acquired by Cisco, where they’ve gone to die. Meanwhile, Snowflake, Databricks, and Datadog continue forward.

This happens every time. If you’re unwilling — especially in the beginning, though it always matters — to pick a very clear problem experienced by a very clear set of people and own that problem, you’ll lose.

The horizontal tool mentality says, “No, no, no — we want to own all the problems.” Look at BI. The biggest mistake ever made in BI was that no vendors committed to solving a specific problem.

Take Anaplan, for example. Anaplan succeeded essentially because it was modern BI focused on financial planning. It was basically a BI company focused on one use case — and that’s how they won.

0:53:52 - Alex Shevelenko
No, I didn’t — so just for our audience, to clarify, you were honest earlier about your own challenges as a category designer who didn’t name the problem.

0:54:06 - Christopher Lochhead
Of course, we’re entrepreneurs.

0:54:09 - Alex Shevelenko
First, a category designer. Second, a solution for transforming static content — important ideas into, you know, not… stuff that was dog shit for Steve Jobs. But I forgot to make a strong point of view on where this matters the most, for whom, and to quantify that — because I was greedy and I wanted to.

0:54:38 - Christopher Lochhead
I know, I was like that too. We all are. And it’s not just greed; it’s… we want to stay open, we want to appeal to as many people as possible. I want to… I want to.

0:54:48 - Alex Shevelenko
I want to be able to talk to anybody with me. I want everybody to love me. To serve as many people as possible.

I guess that comes from wanting to be a servant leader, or maybe just ambitious. We’re fooled by thinking that the companies we respect today were born serving everybody and everything — obviously, they weren’t. That’s another delusion.

Now we’re focusing on regulated and boring verticals, where it’s essential to get the information right. But, you know, it sucks the soul out of you to read the PDF version of that disclosure and documentation.

0:55:31 - Christopher Lochhead
Well, I think what you’re doing sounds exactly right. You can have the giant vision.

If we move to the B2C space, we had Mark Randolph on the podcast — Mark’s the founder of Netflix. He wrote a great book called This Won’t Work. It’s fantastic, and the stories are amazing. He tells the whole story in the book, and he certainly did on the podcast, about how the company came to be. He was specifically looking for a big idea.

I won’t walk you through all of it, but when they landed on movies — specifically DVDs through the mail — these were not stupid people. Mark Randolph and Reed Hastings, far from it. Reed Hastings was a B2B guy; he was the founder of either Pure or Atria — I can’t remember which, because they merged to form Pure Atria. I think it was Pure, but I could be wrong. Anyway, Reed was a B2B guy until Netflix.

So they did all this testing and figured it out — mailing DVDs through the mail.

I remember meeting those guys at a Foundation Capital schmooze-and-booze event in either ’99 or 2000, talking to them about it. I said, “I get the mail thing, love your service, it’s great — but what are you going to do? We all know where the tech is going, and sooner or later, we’ll be able to deliver this over the internet.”

They said, “Absolutely.” But back then, most people were still on dial-up, so they had to wait for the internet to deliver this content. They didn’t call it streaming — that category name didn’t exist. My point: Mark and Reed knew where this thing was ultimately going in terms of streaming, but they also knew that if they waited for that, they’d be dead.

0:57:27 - Alex Shevelenko
Right, so they taught people the subscription model because that was also an innovation back then.

0:57:36 - Christopher Lochhead
An innovation unto itself. I also had Cian Tian Zhu from Zuora on the podcast; he’s coming back. Fascinating guy.

0:57:50 - Alex Shevelenko
I worked with Tian at Salesforce.

0:57:53 - Christopher Lochhead
Oh, really?

0:57:54 - Alex Shevelenko
Yeah, very articulate.

0:57:57 - Christopher Lochhead
I really liked him too. Anyway, they knew there was a bigger category to be created, a bigger game to play, and a bigger set of things they wanted to do. But they started narrow — subscription mail — and as the technology expanded in capability, they continuously expanded their category design. So much so that they were the first platform streamer to get into the content business.

Remember, there were no Apple movies, no Amazon movies — none of that existed. They were the first to say, “Not only are we going to stream other people’s content, we’re going to create our own.” And we all know the legendary success that followed.

0:58:50 - Alex Shevelenko
I think our civilization is going to decline now because everybody’s watching movies, thanks to how innovative these guys are. They had to stop at some point. But as someone who loves comedians and live comedy, they completely changed the future for comics and fans.

0:59:08 - Christopher Lochhead
But my point is this: if you think about Netflix as an example, if you’re a startup founder with a very big vision for where you ultimately want to go, but you want to avoid the horizontal tool trap, the right approach is to go narrow in the beginning and then, like Netflix, expand out.

0:59:28 - Alex Shevelenko
Yeah, so let's shift gears for a second. There are some people here who are not entrepreneurs, but they want to think entrepreneurially about their life and career. You’re a first-principles thinker — someone who thinks about thinking. What should we, as humans and professionals, be thinking about regarding our own future in this age of AI, especially those of us with kids or people we want to help nurture and grow? How can we prepare for the, let’s say, Cambrian explosion of innovation and change that is coming, knowing that technology has a much higher capacity for moving and transforming than we humans do in adapting to that change?

1:00:28 - Christopher Lochhead
So the answer to your question is something that should be on the front cover of the Wall Street Journal and pretty much everywhere all the time — and it’s not. You heard it here first.

If you take a step back, the legendary Peter Drucker wrote a book in 1959 called The Landmarks of Tomorrow. In that book, he introduced a new category of employee, a new category of career, a new category of work that he called the knowledge worker — the Knowledge Worker.

If you read that book, and look at Drucker’s work, one of the things he pointed out was that work was changing, and there was this new career path — the knowledge worker, distinct from manual labor. He wanted to distinguish people who made money with their muscles versus their minds. This, of course, contributed to a massive boom in education and the number of people graduating high school. And now, in the United States, an undergraduate degree is considered a prerequisite, just like a high school diploma was once considered essential.

1:01:46 - Alex Shevelenko
We could argue that it defeated communism, or at least the socialist variety of it. And if you look at it, I would like to thank very much my friends from the former Soviet Union — which I escaped — very gladly, that this happened.

1:02:00 - Christopher Lochhead
When did you get out of the Soviet Union?

1:02:03 - Alex Shevelenko
I was a teenager — 13 years old. But I could still fake my dad’s accent very well. Do my Borat… yes. But I think it was… I was just looking…

1:02:22 - Christopher Lochhead
Yeah, I was just looking on Wikipedia. The first line in the Wikipedia entry about knowledge workers says: “Knowledge workers are workers whose main capital is knowledge.”

1:02:38 - Alex Shevelenko
Okay, what is the main capital now?

1:02:43 - Christopher Lochhead
Good question. Here’s what we would propose: if you look at what’s happening with AI today, AI decreases the value of existing knowledge every day. Think about any field of study. Suppose you want to become a Bible scholar. Sure, it would be great to spend time with Bible scholars and teachers, and you can pretty much become a Bible scholar with AI.

Look at what happened this past quarter, and so far in 2025: Gartner Group lost 50% of its market cap — the value it spent 40 years building. Why? Because people in the knowledge-regurgitation business are in trouble. AI makes the value of existing knowledge closer and closer to free every day. And even more, it makes our ability to do things with that knowledge more powerful and closer to free every day. Knowledge is becoming free.

1:04:13 - Alex Shevelenko
Content production is becoming free. These are the tasks that an average middle manager spends a lot of time on — communication.

1:04:28 - Christopher Lochhead
I just read a report: jobs for new graduates in the United States are down 13%. Why? Because when they come out of college, what do they have? A head full of existing knowledge with no experience. AI is replacing book-smart people, not street-smart people.

So, to answer your question: who will be successful? What does “street smart” look like in this post-AI world? Not knowledge regurgitation. Gartner lost 50% of its value. I wouldn’t want to be the CEO of McKinsey, Bain, Booz Allen, or any company that packages and sells existing knowledge — they’re in deep trouble.

1:05:26 - Alex Shevelenko
Knowledge workers inside corporations — most people working in corporations today are knowledge workers. I had an opportunity to become the Chief Marketing Officer of Gartner many years ago, and I literally laughed.

1:05:49 - Christopher Lochhead
I was like, “You’re out of your mind. I’d hate you, you’d hate me.” Anyway…

Basically, you can’t be a knowledge worker anymore. Most people working in corporations today are knowledge workers. So what should you be? You want to be something you could think of as a creator capitalist — somebody who creates net new knowledge and capitalizes on it, either for themselves or their employer. Said more simply: this is the new category.

1:06:26 - Alex Shevelenko
This is a new category. We believe this is the new category — you just framed the problem before, by the way, for our audience, so they can see how the master does it. That was the problem for humanity and our future careers. What we thought were the most desirable jobs are no longer such, and this is the new category — creator capitalists. But explain it to us.

1:06:50 - Christopher Lochhead
Did I do a good job framing the problem?

1:06:52 - Alex Shevelenko
I liked it. I liked it. I believe it too. I’m still figuring out how to define what the new thing is. I’m not sure I’ve nailed the solution as clearly as you have. Yeah, yeah.

1:07:07 - Christopher Lochhead
I’m really curious to get your take. Yeah, let’s dig into it — it’s great. And, by the way, anybody who says they’re an expert on this stuff is full of shit. It’s all happening so fast, it’s so new. Nobody’s an expert — not even the most expert AI programmers will tell you they’re experts. That’s part of what makes it cool and fun. Look, Alex, I’m just glad I’m alive for the beginning.

1:07:34 - Alex Shevelenko
Oh, it’s fun. It’s fun.

1:07:36 - Christopher Lochhead
Right. So who’s going to be successful going forward? Nobody in the knowledge-regurgitation business. It’s going to be people who learn to create net new knowledge, net new value with AI.

And here’s how to think about it: earlier, you talked about how many tech companies are using language like, “Oh, it’s a companion,” “Oh, it’s a co-pilot,” “Oh, it’s an assistant — I have an AI assistant.”

Okay, so — category design. Step back, think, listen to the words, and reject the premise so that you can think in an unencumbered way: co-pilot, assistant.

Now, “languaging” — and languaging is a category design term — means the strategic use of language to frame and change thinking. So what that kind of languaging suggests is: “Oh, I have my main thing here, and I’ve bolted something on over there.”

Let’s talk about Zoom. God bless Eric — love him and the company. However, they’re making this mistake. They call it their AI Companion.

Sometimes the unspoken is louder than the spoken. Years ago, I told my stepmother Nelly, I’d gotten a new tattoo. I said, “Hey, Nelly, I just got this tattoo. What do you think?” She said to me, “I’m really glad you like it.” The unspoken part was loud — she had that kind of sense of humor.

So when you say “companion,” what’s the unspoken part? The unspoken part is: “Our main thing is this, and we’re adding on AI.” It’s a sidecar, it’s a bolt-on.

And here’s the aha — and this applies to everyone’s career: I’m leading somewhere with this.

AI is your career. AI is not a bolt-on to your work. AI is the thing.

The mindset we recommend for individuals is: AI is the co-founder and co-creator of my career — all day, every day. And the same goes for startup founders: AI is the co-founder of your company.

1:10:00 - Alex Shevelenko
So when you make it that central — here’s a simple thing we recommend today. Basically, I’m going to use this metaphor because some companies have mascots — so do we need AI as the mascot in a company?

1:10:14 - Christopher Lochhead
No, it’s not a mascot — it’s one of the founders.

1:10:18 - Alex Shevelenko
One of the founders. Okay, got it — I got it wrong.

1:10:26 - Christopher Lochhead
Yeah, we may be getting lost in translation.

1:10:27 - Alex Shevelenko
Yeah, all right. And here’s a recommendation we have for everybody.

1:10:31 - Christopher Lochhead
If you’re using only the free, publicly available AIs — and that’s your AI experience — you don’t know what the fuck you’re doing, and you haven’t really used AI.

Here’s what we recommend: don’t get your company to pay for it — you pay for it. Spend the $200 a month on ChatGPT, Claude, Grok, or whatever your favorite one is. What you want is your own proprietary AI.

This is exactly what we’ve done at Category Pirates. We dumped everything we’ve ever written — every deliverable we’ve ever created — into our own proprietary custom ChatGPT, the $200-a-month version, so it’s not shared with the rest of the world.

1:11:23 - Alex Shevelenko
So it’s not shared — so they can’t write those beautiful emails that you do, that feel like poetry.

1:11:31 - Christopher Lochhead
That’s exactly right.

And here’s the aha: for you and your career, what I’m saying is — cough up the money. Spend it. Because it’s a massive investment in your ability to produce results.

When you build your own custom, proprietary AI with everything you know in your domain, and you use it continuously to produce results — to create net new value, rather than regurgitate old knowledge — you become what’s called a creator capitalist. You’re creating with AI.

In software development, they call it “vibe coding” — you talk to AI, and the AI writes the code. In the non-software world, for creator capitalists, we call it “vibe creating.”

Once you have your own proprietary AI, trained on all your data — one you talk to and use all the time — you get a flywheel of legendary happening.

And here’s how I feel personally, since we’ve done this at Category Pirates — with the writing we do, the work with startups, the courses we teach, and all that:

I’ve had a 38-and-a-half-year career getting really good with a sword — and two and a half years with a lightsaber. I’m glad I have all those sword skills, I really am — but I’m not going back.

You can’t have my lightsaber. Go fuck yourself. All right, I have a superpower now.

1:13:25 - Alex Shevelenko
What if you’re starting out, Christopher? What if you’re just starting?

1:13:28 - Christopher Lochhead
This is what I would do right now.

1:13:30 - Alex Shevelenko
But you don’t have… I mean, somebody starting out doesn’t have an original body of work, a ton of original ideas.

1:13:39 - Christopher Lochhead
What’s the thinking that you like? What’s the thinking that works for you? Let’s say you’re in marketing, and you say, “I want to build my own proprietary AI.” Okay, you pay the $200 a month for ChatGPT — I don’t care which one it is. We pick ChatGPT for a bunch of reasons, but if you want Claude, pick Claude. Or whatever you prefer.

Here’s what happens: you can say, “Listen, here are the 10 thinkers…”

1:14:04 - Alex Shevelenko
Well, maybe this guy I listen to. Here are the 10… I love this guy, I love that guy.

1:14:07 - Christopher Lochhead
Exactly. “Here are the 10 marketing thinkers that have influenced me the most.” And you begin a conversation with your AI. Tell it why, and ask the AI what it thinks of those 10 people. Then there could be entrepreneurs you admire, books you’ve read that were hugely impactful, courses you’ve taken in school, things you’ve learned in your early career. Tell all of that to the AI.

Even if you’re 18 years old, you have something you can begin to contribute to your own proprietary AI. Then, when you start working, you can start to vibe-create results. That’s why it’s called a creator capitalist — somebody who creates things and capitalizes on them, creating value.

Creating value with AI is what a creator capitalist does. If you’re not doing that and stay in the knowledge-worker world, you’re going to be toast. But if you learn to create net new value with AI on an ongoing basis, you’re going to be the most successful, most creative, and most innovative humans alive. That’s why being alive now is so cool.

1:15:39 - Alex Shevelenko
So, people listening…

1:15:40 - Christopher Lochhead
Yes, go ahead.

1:15:42 - Alex Shevelenko
People listening right now probably get shivers down their spine. But what I would argue — one of the crafts of connecting, interviewing other great communicators — some people say, “Well, AI has better emotional intelligence. They’re getting relationship advice. Everybody who’s getting divorced, they spend all their time with the AI, learning how to navigate that.”

1:16:30 - Christopher Lochhead
Uh, and so everybody’s doing the exact same thing. By the way, it turns out ChatGPT is an incredible divorce lawyer, therapist, and children’s coach.

1:16:40 - Alex Shevelenko
And there was this assumption that AI isn’t going to be better at emotional intelligence, that we humans are still going to be great at being humans. But we know AI, at least, is more polite and can cut through the bullshit that blinds us. Communicate — AI at this point isn’t capable of cloning your interactions and your superpowers of connecting. So what’s your take on that element? Particularly in the communications world, but also for people starting out — are my relationship skills going to matter? Or not as much as we think?

1:17:28 - Christopher Lochhead
Oh, I think they’re going to matter more. We could talk about that in a second. As a matter of fact, I think we’re in a relationship paradigm crisis in the United States, especially for young people. We can dive into that if you want.

Here’s the thing: I got into an awesome dust-up on LinkedIn with some dude who proclaims to be an AI instructor, a professor at Berkeley. He was telling me everything I said about AI was bullshit — AI is hype. This guy teaches at Berkeley, for fuck’s sake.

So here’s his argument: I just described to you what we’ve done at Category Pirates. We call our AI Lucy, and we use Lucy for everything. I’m in Lucy all day, every day. I write emails with Lucy. I mean, you love Lucy — basically, you love Lucy. The more we use Lucy, the greater she becomes, and it’s a virtuous circle of awesome.

This guy says, “That’s great for you right now, but with all new technology, everybody’s going to be able to do the same thing, and then it won’t matter. Everybody will have their own Lucy.”

I said to him — and this guy’s a learned Berkeley professor — I said, “Okay, I like to watch racing. We live not far from a racetrack. I go out a couple of times a year. A buddy of mine is really into MotoGP. It’s really fun — not a huge fan, but live, it’s amazing. You can be right there in a corner. The whole thing is fun.”

So I said to this guy: just because every race car driver in the world can buy the same parts, have the same expertise, drive equal cars, and have equal resources, plus or minus — why is there one guy who wins a lot more than the others? Why is that? I thought we were all equalized. Now, you stupid fuck.

Just because you own a Ferrari doesn’t mean you’re going to win races.

Right now, in our world — some might call us a media company, an education company, a content company. We think of ourselves as an education company. But are we able to produce results that others cannot, because we’re on the bleeding edge of AI? Yes.

What we’re doing — teaching, writing, creating with AI — is orders of magnitude above what’s happening in most universities. I got an email a couple of days ago from a gal I know and respect, and her son, I believe he’s in law school, was banned from using AI. They literally cut him off from the future.

1:20:53 - Alex Shevelenko
That’s insane — not even… not even Harvey?

1:20:55 - Christopher Lochhead
No, they can’t use Harvey, Benny, Lenny, or any of those. This is insane. We should be teaching our children, young people, in universities, colleges, community colleges, and high schools — all the way down — how to create with AI.

Doing the opposite is literal insanity. Literally cutting our children off from the future. It’s insane to think it’s an equalizer. The reality is, like any other technology, we all have laptops. You start a company with your laptop. You’ve created massive value by typing on keys, making presentations, spreadsheets, documents, and other digital assets worth millions over time.

A lot of people type away on laptops and never produce anything of value. Do you see?

1:22:06 - Alex Shevelenko
So there’s a tension. Some people believe AI is going to be a democratizer, and some people believe — which is what you’re saying — that it’s a democratizer only for those paying attention.

1:22:17 - Christopher Lochhead
Most are not paying attention.

1:22:19 - Alex Shevelenko
Right. So in order to benefit from democratization, you have to be hungry, and you have to know.

1:22:25 - Christopher Lochhead
Democracy is occurring, right. Here’s another way to think about the shift from knowledge worker to creator capitalist. Another lens on the same phenomenon: I’m 57 years old, so I’m a Gen Xer. Gen X is the last generation of native analog humans. Millennials, and especially Gen Z, have grown up with technology for most of their adult lives — obviously, Gen Z from the very beginning. Even most millennials had smartphones at reasonably early ages; Gen Z even more so.

They are the first generations — millennials and Gen Z — of native digitals, and their entire orientation is different. Their world is digital first, analog second. My world… not so much.

Listen, I’ve been in the tech industry for 40 years. I started my first company at 18. I’m very tech-savvy, but I’m not a native digital. Even though you and I are having this awesome conversation on the internet — which is fantastic — I’d much rather be sitting down together having a beer or coffee, in person.

1:24:02 - Alex Shevelenko
You ask most millennials and Gen Z-ers, “This is as close as it’s going to get.” Ask a millennial or Gen Z-er after a Zoom meeting, “What happened?”

1:24:15 - Christopher Lochhead
“What did you just do?” And many times they’ll say, “We had an in-person meeting.” But this is not an in-person meeting for them — it’s a digital meeting, a Zoom meeting.

1:24:28 - Alex Shevelenko
Here’s another great example.

1:24:30 - Christopher Lochhead
This is very important, because it sounds subtle and insignificant, but the profundity is missed by most people. Here’s how profound “digital first versus analog second” is:

If you invite me to your house for dinner, as a native analog, this is a problem I understand. I’m outside your house, I want to be inside, and there’s a known analog solution: two actually — one, I knock on the door; two, I press a doorbell. Both are analog.

Ask a millennial or Gen Z-er. You invite them over — what do they do? They call you, they stand at the door, they text. The same problem, centuries-old solution, is rejected by native digitals.

1:25:51 - Alex Shevelenko
I’m glad my kids are ringing the bell like crazy instead of just using their key. That’s very… it means they’re still very analog, grounded.

1:26:05 - Christopher Lochhead
Right. It’s a very different world when it’s run by people who are digital first, analog second. That’s why, if you talk to young people about dating, they’ll tell you it’s very hard today. Part of it is because they don’t know how to — and this is the word they use — “conversate.”

1:26:29 - Alex Shevelenko
They don’t know how to conversate. This is the part I’m worried about: the younger generation. Back when we were hunter-gatherers, we were walking and talking — not even looking at each other, just literally walking and talking while looking for deer or bison. We were happy. We were programmed to be happy. This was the right level of activity: physical activity together with social activity.

Now, we live in a world where you could mimic that digitally. I actually like to do walk-and-talks with friends — I do walking meetings all the time in New York. When I was an executive living in California, I did walking meetings all the time.

What you’re describing: the next generation not only feels that’s uncomfortable, they lack the skills and practice to have these conversations. They could spend all their time chatting with ChatGPT — which is great and fun — just like Wikipedia once was. But when do we pull up? To stay healthy as humans, we are not wired to only talk to ChatGPT, at least in its current form.

So what’s your take on how we maintain — that is, back to the question of humanity, human connection skills? How do we do that?

1:28:32 - Christopher Lochhead
I think there are a couple of things going on here that are really important. The first one is that you and I desperately need each other. Human beings are such radically social animals — what’s the number one form of torture we have?

1:28:54 - Alex Shevelenko
Solitary confinement.

1:28:55 - Christopher Lochhead
Correct. Think about that for a minute. Stand back and ask yourself: why is locking a human…

1:29:13 - Alex Shevelenko
…alone in a room by themselves the worst torture we can imagine? We were built to survive in packs, and we were rewarded for that. Yes, we are pack animals.

1:29:36 - Christopher Lochhead
Exactly. Why do we all live in cities on top of each other? Because we’re pack animals, and we desperately need each other. Being together in the analog world is profound for us.

Here’s the flip side: to your friend going through a divorce, AI is always there, always on, and right now it’s programmed to always be on your side. Look at some of the Kinsey data on sex: young people are having sex later and later, and less and less of it. The amount of sex is declining dramatically. Here’s why.

1:30:25 - Alex Shevelenko
Isn’t it great to be a Gen Xer? Oh, fuck — are you kidding me?

1:30:32 - Christopher Lochhead
The reason is primarily young men: it’s just too easy for them to satisfy sexual desire via the internet. They say, “It’s not worth the hassle.” I’ve had this conversation with lots of young people in my life. Girls say, “It’s not worth the hassle — they’re confusing, I don’t know what to say, they’re a mystery to me.”

1:30:58 - Alex Shevelenko
Blah, blah, blah… and, oh, by the way, I masturbate 15 times a day.

1:31:06 - Christopher Lochhead
Yeah, you don’t want to touch that guy’s keyboard afterward. No, unless… yeah. There are some horrible things I was about to say, but I’ll shut up.

So my point is: we’re at a place where young men, more so than women, are doing this calculus: “I don’t want to develop these skills. I’m not developing these skills. I don’t have to develop these skills.”

Back in puberty, when testosterone starts pounding through your body, you had to learn to be socially adept. You had to learn to play guitar, be a great student, figure out how to attract women — the classic peacock behaviors.

There’s a great old John Mellencamp song: Forget about that macho shit and learn how to play guitar. Young men figured it out: “If I want to be with a woman, I need to be desirable. What do women desire? I’ll pursue those things.” Maybe you learn to walk across the gymnasium and ask someone to dance.

Well, guess what? They’re not developing any of that anymore. Their early sexual desire can be fulfilled online, and it’s easy. I’m not railing against porn — I’m just reporting what I read and what young women tell me.

1:32:42 - Alex Shevelenko
But, Christopher, this is shockingly sad. The thesis that we could become creator capitalists won’t materialize for people who cannot do this. If you can’t go talk to a girl, what are you going to create?

1:33:08 - Christopher Lochhead
Exactly. To extend the metaphor: you’ll be afraid of taking risks. Of course, there’s a lot you’ll be afraid of.

Funny enough, I had this conversation this week with a young woman, about 25 years old. I posted about it, and the responses were interesting. We were sharing life experiences, and she told me about a date. I asked, “How’s your dating life? Do you have a boyfriend?” She rolled her eyes and said, “That’s fucking terrible.”

I asked her to explain, and her sentence stopped me in my tracks. She said, “Young men today want to be women.”

I said, “What are you talking about?”

She explained: even aside from the whole trans conversation, they’re passive. They won’t ask you to dance, hit on you in a bar or restaurant — they don’t do any of that stuff, and they don’t know anything about social interaction.

1:34:21 - Alex Shevelenko
Fear of rejection plus instant gratification. Is that it?

1:34:28 - Christopher Lochhead
Maybe. But she said it this way: “They’re soy boys. They’re weak, effeminate. They all hang together like a gaggle of girls. They don’t have ambition or drive. They all want to be influencers.”

There’s a quote by G. Michael Hoff: Strong men create good times. Good times create weak men. Weak men create hard times.

My biggest fear for the Western world is that we’ve created a society of weak men. Men have been left behind: they aren’t graduating, they aren’t succeeding in the workforce. Young men and boys are burying themselves in video games, etc. The unfortunate outcome, at least in part due to the women’s movement — which I fully support — is a radical feminization of men, at least here in the U.S.

George Carlin called it the “pussification of America.” I’m not talking about macho stuff — I’m talking about strong men: ambitious, successful in their careers, driven to create value.

My mother and grandmother told me, “Christopher, you need to make something of yourself.”

Essentially, what this young woman said to me is: the problem with young men is they don’t want to make something of themselves. They’re mushy, uncommunicative, digital “donkeys” who want to be influencers. That’s what she said. Not my assessment — hers.

1:36:49 - Alex Shevelenko
So this is tragic because our industry is potentially accelerating this trend. Basically, what you brought up is that, yes, there are some natural societal moves toward this, but the point is: instant gratification culture, where entertainment and distraction are always a moment away — and the matchmaking, dating, or whatever is also just a click away — creates a perception that modern humans aren’t being trained to be good at being human. That is, persisting in ambitious wanderings, exploring, going on adventures.

I agree with this observation. After GSB, I went backpacking around the world, and I still remember a very similar conversation with a girl I was trying to impress in Hong Kong. She told me the reason she was talking to me — and I don’t really know why — was, “Alex, the Chinese men are so boring. They just sit and watch video games.” This was a while ago, of course.

This video game example was an early indicator, in some subcultures, of people not pursuing ambitious projects. One of the things that really motivates me, in having conversations with people like yourself or in what we’re working on at RELAYTO, is making complex, difficult, regulated — but important — ideas accessible. Knowing that we are distracted, Instagram-trained, TikTok-trained, we can still navigate the interesting pieces, still have context, and still have the ambition to tackle big, important things using technology.

What I worry about, again, comes back to the AI world. It’s becoming so easy to appear as a fake expert. You just chat with GPT and suddenly, you’re an “expert.” You mentioned that this advantage might disappear. But I wonder: what would your advice be for this generation entering the workforce, and for the people managing them, about setting the bar, having ambitions, and building careers — for both men and women? I think women are still impacted by these cultural and technological influences as much as men.

I know we’ve been at this for a couple of hours, so we probably need to wrap up. But I’d love to leave on this note: what would be your advice to future generations? 

1:40:23 - Christopher Lochhead
Perfect. Before I answer, let me put this in context. The setup you just laid out, Alex, is very important. The lens through which I process what you just said is this: the definition of what it means to be human is changing.

We’re in a cocoon, moving from native analogs to the first generations of native digitals. I don’t know when we’ll come out, but the definition of a human being is literally changing because technology is central to our lives. When we say AI will be a co-founder of our career and business, we’re also saying AI is a co-founder of our lives. Most people would rather lose a body part than their iPhone. Most of us wouldn’t want to give up our iPhone for a day, let alone a week or a month.

Is there something bad about all this? Sure. Nuclear technology can be a powerful source of clean energy or an instrument of destruction. Guns can protect or harm people. No technology is inherently good or bad.

Take something simple, like Facebook. I think Mark Zuckerberg has done many evil things, and his company has too. And yet, they’ve connected people. They allow grandparents to see photos of their grandchildren even if they live far away. Is Facebook evil? Probably, in part. Do I still use it because I value staying connected? Yes. I don’t love the company; I admire some things, but I’m also disgusted by others.

AI is the same. It can help cure cancer and solve diseases. Breakthroughs in longevity that were already impressive pre-AI will be extraordinary post-AI. Babies born today could see 150 years old, according to longevity experts. Any technology can be used for evil or greatness; it’s a spectrum. That’s point A.

Point B: being digitally savvy is your ticket to the dance.

If I were a young person — late teens to late 20s — I see two buckets.

Bucket one: “Oh shit, nobody’s hiring young people anymore. I just read this horrible report. I’ve applied for 27 jobs online in the last three weeks. I haven’t heard back. I’m sick of being ghosted. I have a degree, but I can’t find a job. Times are tough, companies digitally ghost me, AI is taking over, la la la.” That’s one loud, very vocal group.

Bucket two: at Category Pirates, we have interns — late teens, early 20s — and recent grads. They’re doing amazing work with AI, often building projects with very small teams. Here’s the aha: the young people thriving today aren’t filling out job applications online. They’re in the game, using their native digital skills to make a difference. For native analogs, we’ve written extensively about this.

1:45:20 - Alex Shevelenko
They're coming to a guy like you or me and saying, “I could solve these five problems for you. Here’s my… maybe I’ve solved a couple of them already.”

1:45:30 - Christopher Lochhead
Which ones matter the most? And that’s the internship — sometimes problems I wouldn’t have thought about. I’ll give you a simple one. I have four or five learning differences: ADHD, dyslexia, dyscalculia, la la la. I call it… it’s actually a superpower; I call it “dysfucleo.” What that means is I’m often late, I can’t find my keys — you know, it’s just part of my life. But it’s worth the wait.

1:45:58 - Alex Shevelenko
You’re worth the wait.

1:45:58 - Christopher Lochhead
You’re worth the wait. Well, let’s agree. You know, I’ve done all right for a kid with no GED. Anyway, one of these younger folks — this teenager — was building some little agents and helping out with our AI stuff. Because we’re AI-first, everything we do is AI-first. We’re selling AI products now at Category Pirates — Pirate Eddie Bot. You can have a conversation with it about anything you want, with category design.

Somewhere along the line, this young man hears about my problem — my “dysfucleo,” meaning I’m often ten minutes late and all that. He says — remember, this kid’s not even 20 — “Oh, that’s simple. Let me build an agent for that.” And guess what? I get a text message 15 minutes before anything I have to do from R. It says, “Hey, your podcast with Alex is in 15 minutes. Don’t be a donkey.” It’s improved my accuracy — my punctuality — by at least 50%. You’d have to talk to Eddie and Katrina to know for sure.

Anyway, that’s a tiny, simple example. But here’s a teenager who figured out that there’s a small company run by three people doing AI stuff. He was a friend of a friend, got connected, started doing a few things, and has been an intern. My point: find a way to be valuable. Specifically, the advantage you have as a native digital is massive for native analogs. Eddie and I call it our “digital wheelchair.” We have lots of people who push us around in it, and they are invaluable to us.

1:48:00 - Alex Shevelenko
Right. They might not stand out to their peers, but to us — or to somebody further along — absolutely. They aren’t going to get hired by OpenAI to build the next…

1:48:13 - Christopher Lochhead
No, no, no. They’re “regular” kids — smart, savvy, living in this world — and they figure out that if they can be a bridge, a translator, their native analogs like me, you, Eddie, and many others who are deeply tech-savvy, have a vision, ideas, and want to learn and change… look, you’re talking to somebody who wrote one way his entire life, and in a very short time, I can write without AI.

Here’s the other thing: people say, “Nobody likes change, nobody likes it.” Bullshit. We love change. If you show us a solution to a big problem — or even a problem we didn’t know we had — we have an “aha” moment. We can’t unsee it. We want to have it. Most people fall asleep.

1:49:07 - Alex Shevelenko
The only thing we love… maybe this is a formula. I think we love change because we’re more lazy than averse to it.

1:49:26 - Christopher Lochhead
Yeah, maybe. I mean, I like being lazy. I really do. I like goofing off. There’s a country artist I love, Robert Earl Keen. He’s got lots of great songs about doing nothing, wasting his life away — and I’m a fan of that.

That said, I think it’s more than just laziness. Sometimes it’s friction. Maybe it’s like this: the car I drive today has three to five times more horsepower than the first car I ever drove. I love it. I wouldn’t go back to those old cars. My wife and I wanted to buy an old Bronco. The one we bought is a fully restored old body, but all the internals are modern — cost a bazillion dollars, by the way.

The point: we’re open to change if it makes a difference. Sometimes that’s laziness, but sometimes it’s creativity. Eddie is a legendary writing partner for me. Katrina is a legendary writing partner. Now Lucy is a writing partner for all of us. We have a fourth person in the company.

1:50:57 - Alex Shevelenko
That’s great. That’s legendary — an exciting way to wrap up, Christopher. I think it’s an optimistic note. I’m very optimistic about the future.

1:51:15 - Christopher Lochhead
This is the greatest. So, if we talk about countries, nations, and societies: one of the biggest problems in the part of the world you come from is communism. It crushes entrepreneurship because the government can take over at any time.

I’d argue there’s no greater force for good on the planet than entrepreneurship. There are others, sure, but look at the United States: more startups have created more value over the last 30 years than anywhere else. Today, Europe is struggling because there are no entrepreneurs.

1:52:10 - Alex Shevelenko
So it’s a finite mindset.

1:52:13 - Christopher Lochhead
Correct. The Soviet Union is an example.

Yes — this is the fundamental difference between capitalism and communism, in my opinion. It’s the difference between fighting over scarcity and collaborating over abundance. When humans collaborate to create abundance, incredible things happen: we cure diseases, feed people who couldn’t get fed, go to the moon — maybe Mars — and so on. When humans fight over scarcity, we kill each other. Entrepreneurship in a capitalist system harnesses the human drive to create for good.

1:53:07 - Alex Shevelenko
And AI increases the range of what abundance could be, so it could be an amplifier for this.

1:53:14 - Christopher Lochhead
Absolutely. It’s the amplifier. What’s my point? There has never been a greater time to be an entrepreneur or a creator of any kind of value because of this technology. The people who embrace AI and become creator capitalists will be the most productive, most successful, most innovative, most creative, and wealthiest human beings that have ever lived.

The new definition of what a worker is is emerging — we think of it as a creator capitalist — and the new definition of what a human will be with AI is being created right in front of us.

We want to be part of it. If you’re smart, you want to be part of creating that future. You want to be on the edge, experimenting and asking questions like: How do I solve new and different problems for people I care about with AI? How do I create net-new things of value around topics I care about with AI? The future needs people with this mindset: “I can design the future. My future is up to me. I can create value. I can do it with partners, co-founders, and together we can make a difference.”

Oh, and by the way, the ubiquitous capabilities of the internet, coupled with AI, mean that in the past, I had to have all these hard-to-get, expensive analog resources if I wanted to create great things.

Today, I can create legendary digital things, and all I need is a laptop and a browser, or a smartphone and an AI. For those of us who want to create radically different futures, who want to live fully expressed lives — doing things that are powerful, creative, innovative, and, in my opinion, core to the human spirit — our ability to do that is greater today than ever before. That’s why I’m radically optimistic.

It’s also why I ring the bell so hard about the areas of our world that are missing this. The delta between the haves and the have-nots going forward is going to get bigger. The number of people who complain that AI “screwed them” will go up exponentially. The number of people who use the tech to do legendary things will also go up exponentially. I know which side I’m trying to be on.

1:55:51 - Alex Shevelenko
Thus spake Christopher Lochhead. This has been amazing, Christopher. If anybody has half a brain and half a heart, they’ll want to follow you for the rest of their lives. Where can they find you?

1:56:05 - Christopher Lochhead
I’m all over the place. If you want to hook up with everything, just go to categorypirates.com and you’ll find me.

1:56:16 - Alex Shevelenko
Please do. You will thank me and Christopher for it if you’re hearing him for the first time now. This has been amazing. Thank you — I honestly cherish this. This is one of the reasons I started the podcast: to have conversations like this. Thank you.