AI Agents and the Fight for Customer Data

Martin Casado speaks with George Fraser, cofounder and CEO of Fivetran, about the future of data infrastructure in the age of AI. The conversation covers Fivetran’s merger with dbt, the changing role of data platforms, and why Fraser believes many companies are overestimating the threat AI poses to enterprise software. They discuss open data access, the backlash against AI agents accessing systems of record, and why businesses still need centralized data foundations even as agent-based workflows become more common. Along the way, Fraser shares his views on data gravity, coding agents, enterprise AI adoption, and how AI is changing the way software companies build and operate products.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  There is a new reason to have all your data in one place, which is AI agents need context. If you don't do that, then it's sort of like using ChatGPT from before ChatGPT was connected to the internet. Postgres, contrary to popular belief, is very old technology. It is not a good database, simply because it was written a long time ago. It has a lot of technical debt.

• 0:19Martin Casado?

  Satya has said that there's going to be the collapse of SaaS. Do you think that SaaS apocalypse is a thing? Are we going to see a massive shift?

• 0:26Speaker 00

  The bigger threat is that AI native companies will just zoom and catch up to the established incumbents and maybe be better.

• 0:35Martin Casado?

  Like, we'll actually have an HR. And that HR team will onboard AIs as they come. They'll be part of teams, they'll join the Slack. And in that world, these aren't software. There's actually more seats, more consumption of software. And so do you think that for enterprise agents, we're moving more to these? You treat them like humans? Or do you think that that's too far?

• 0:55Erik Torenberg?

  For years, companies built data infrastructure to answer questions about the business. Now they're building it for AI. As agents become more capable, the challenge is no longer collecting data. It's making sure the right systems can access the right context at the right time. That shift is forcing companies to rethink everything from data platforms and APIs to enterprise software and systems of record. Martin Casado speaks with Five Tran co-founder and CEO George Fraser about AI data infrastructure and why the next wave of enterprise software may look very different from the last.

• 1:35Martin Casado?

  So our guest today is George Fraser, who is the CEO of Five Tran. Five Tran announced the merger with DBT. So maybe to start, just give a quick overview of what Five Tran does.

• 1:46Speaker 00

  So Five Tran, we've been around for a while. We've been around since 2013, had customers since 2015.

• 1:52Martin Casado?

  2013, 13 years?

• 1:53Speaker 00

  Yeah, exactly. I've been doing this long enough that a slide about the past state in my own slides is the same slide as the future state from when I started. But what Five Train does is we help our customers get all of their data from all their systems like Salesforce, NetSuite, all their SaaS tools, their own databases into one place. Getting all your data in one place, it's not a new thing. Businesses have had the need to do this since filing cabinets. The primary reason historically that people use Five Train to get all their data in one place was to do business intelligence, was to build reports about things like, what's your revenue? What's going on with your sales team? What are we forecasting for this quarter? All those great things.

• 2:35Speaker 00

  And now there is a new reason to have all your data in one place, which is if you want to use AI agents in business, AI agents need context. And it turns out that the same data foundations that work well for business intelligence and reporting with some additions and some modifications actually can work really well for AI agents as well.

• 2:55Martin Casado?

  Let me talk about a sector of the industry which is under a lot of change because of AI. And so maybe, could you give like a high level overview of how it is evolving? What are some of the considerations about the shifts in data? And in particular, like we're seeing a lot of changes how vendors view their own data, how the big labs use data. So just talk a bit about what the industry is.

• 3:17Speaker 00

  The thing about data in the context of business is it is always born somewhere else. It's always born in systems of record like Salesforce, like Workday, like SAP. And even if it's your own applications data, if you're a software company and you run your own database, the data is born in that database. And since, as I said, a time immemorial, businesses have had the need for internal use to centralize a copy of all their data in another location. It doesn't work to just go and do all of your reporting and ask all your questions in each system individually. Some kinds of questions require you to look across the entire system.

• 3:59Speaker 00

  And so that is not new. However, these AI agents are new. And there has been, in the last year, A reaction, which really started with the stock market. As we saw the SaaS apocalypse happen and as we saw the stock prices of all of these systems of record that I'm talking about plummet, people viewed them as under threat from AIs. We have seen some of these companies start to think that a great strategy for dealing with AI might be to lock it out and to say, your data is our data now and you can't take it elsewhere. And if you want to use AI on it, you have to use the AI tools that we provide. Notably, just a couple of weeks ago, SAP announced a new API policy that literally

• 4:44Speaker 00

  said all AI agent access was banned, except in a way specifically approved by SAP. Now, if you're an SAP user, don't panic. This is just a policy. You have contracts with SAP. Those are authoritative as to what you are and are allowed to do. So don't overreact to these policy memos, but it just shows how extreme the reaction of some of these companies has been.

• 5:08Martin Casado?

  I just want to tease this apart because I think there's a lot of confusion on what exactly is going on, right? So this is locking down access to the data that an agent would use instead of an app, right? It's not access to data because you're going to train your own model.

• 5:21Speaker 00

  That's right. Very few people are in the business of training their own models. Most people, when they want to access their own data in their own systems of record, even if those systems of record are managed by vendors, they are using it for context. They're using it in order to ask and answer questions about what's going on in their business.

• 5:38Martin Casado?

  Right. So the concern is my SaaS app has less value as an interface because now the agents can access the data directly and basically perform the same functions the SaaS app was before. Is that the concern?

• 5:52Speaker 00

  I think there are many concerns. I think that is one of them.

• 5:54Martin Casado?

  Can you just straw man the set of concerns? Because this is one of the biggest reactions I've seen in the industry in a very long time, and I'm kind of trying to come to grips with what the actual worry is.

• 6:04Speaker 00

  I think people are worried that their systems that they've spent many years building will simply be less valuable in a world where their users are no longer humans, but they're agents. I think they're worried that-

• 6:17Martin Casado?

  But why isn't this just another seat? I mean, it seems like, I mean, arguably, this is positive because there's going to be more consumers of-

• 6:24Speaker 00

  So agents don't need as many individual identities. When you have AI agents accessing systems, you really just need roles. You don't need the same granularity of users. You have many product managers, each will have their own identity in a system. But if you have a product manager bot, you really might just have one role that it uses. And it might have a single identity and yet do the work of hundreds or thousands of people. So there's not an easy answer like that. Furthermore, these companies have a history of having open APIs. Open APIs are a good thing. If these companies did not have open APIs,

• 7:06Speaker 00

  they would have been consigned to the dustbin of legacy SaaS decades ago. I mean, this is a thing that happened in the 90s, right? The evolution of open APIs. And their customers have been using them and depending on them for decades. And those same APIs are the primary target of AI agents. So it is very hard to differentiate whether the users are accessing the APIs in the same way that they always have been, or whether they are accessing them in agentic ways that may substitute for human workflows.

• 7:39Martin Casado?

  I'm going to keep poking on this because I still think it's not a real concern. So let me make another strong argument. So let's say you had opened up all your APIs in the 90s, which is the case. Like, why couldn't I just write a procedural app, which is my own version of the SaaS and therefore also disintermediate your SaaS? Like, why are agents somehow different than me just writing my own software or my own dashboard?

• 8:00Speaker 00

  Maybe they're not. This may all be kind of much ado about nothing. I think it's foolish for them to close down their APIs. So you're putting me in a weird position.

• 8:08Martin Casado?

  No, I do.

• 8:09Speaker 00

  Of trying to defend a position that I think is stupid.

• 8:13Martin Casado?

  Yeah, yeah, yeah.

• 8:14Speaker 00

  So I think a lot of these threats are not new. Like, well, maybe they'll use programmatic access and thereby use less seats. Maybe they'll move some functionality to their own interfaces. I mean, that is a real thing that has been happening.

• 8:27Martin Casado?

  I just want to let you know, I am old enough to remember these discussions in the 90s. The rhetoric was exactly the same. The reaction is exactly, we could never open up APIs. We can never have them do this because they're going to disintermediate us. And it just turns out that if you're buying into a business process, like the operational flow of something, that is set up by the company that you're buying it from. Salesforce knows how to run the Salesforce. And so whether it's an agent that's consuming it or SaaS, I would argue that there's still the value there.

• 8:54Speaker 00

  I completely agree. And I will point out another piece of evidence for that claim, which is if you look at the budgets of real companies that are heavy consumers of software, they spend 5% to 10% of headcount on software. Software costs are immaterial in the grand scheme of things. Software compared to everything else a typical business spends money on is so cheap. The idea that they're going to use AI to value engineer the number of seats they have on Slack or something is ridiculous. They're going to use AI to go make their business work better in whatever it is that they do.

• 9:32Martin Casado?

  That they're actually.

• 9:33Speaker 00

  They're not trying to take that 5% software spend and turn it into four and a half. That is not the highest best use of AI.

• 9:40Martin Casado?

  I mean, famously, all the big AI labs, including Andreessen Horowitz, and we're all very heavy users of AI, like still use these SaaS tools. And so four years into this, we don't have a lot of evidence that like.

• 9:51Speaker 00

  As do we, as do OpenAI and Anthropic.

• 9:54Martin Casado?

  Exactly.

• 9:55Speaker 00

  Who are both Five Tran customers, and we replicate lots of data from these very SaaS tools on their behalf into their data lakes. So if they're still using them, do we really think the company of the future is not going to be?

• 10:09Martin Casado?

  Right, right. But one thing we can both agree on is this is bad for customers, right? This kind of locking down the APIs is bad for customers. So maybe talk through, like, A, why it's bad, which may just be obvious, and then B, kind of your recommendation for how to manage that, like assuming that this is happening industry-wide?

• 10:28Speaker 00

  So the reason it's bad for customers, anytime vendors put up walls and try to regulate data access is that you need to have all your data in one place in order to do meaningful reporting, in order to understand what the heck is going on in your business, and in order for AI agents to work in the context of business. If you don't do that, then it's using ChatGPT from before ChatGPT was connected to the internet. If you used it back then, you remember it used to have this knowledge cut off and it would tell you I can only answer questions that happened by in my training window.

• 11:03Martin Casado?

  Six months ago.

• 11:04Speaker 00

  Yeah, six months ago was when I was trained. I don't know anything after that because I'm not connected to the internet. That is what using today's AIs is like if you're using them in a business context and they don't have access to your business data. And so it's very important for every company who wants to do things with data to create their own data platform where they have a copy of all of their own data and it's being kept continuously up to date. And anytime vendors start putting up barriers, it just makes it harder to to get that done. And the customers will still do it. They'll just work around these barriers at great cost and complexity.

• 11:42Martin Casado?

  And one of my favorite things that you've done as a company to educate the customers on this is this benchmark. Can you maybe talk through what that is?

• 11:51Speaker 00

  Well, we have a website. Is that what you're talking about? Open Data Infrastructure?

• 11:54Martin Casado?

  Open Data Infrastructure.

• 11:55Speaker 00

  Yeah, Open Data Infrastructure.

• 11:57Martin Casado?

  It's a benchmark, like it does scoring, right?

• 11:58Speaker 00

  Yeah, so we score, the list is growing. We're trying to make it as long as possible. We score as many vendors as we've been able to to catalog so far on their data access policies. So we basically score them on whether they try to charge egress charges, whether they try to make you pay for getting your own data out, whether they.

• 12:21Speaker 00

  Uh, whether they make it impossible to get a complete copy of your data because some vendors will do that or they'll make it just very difficult. And whether they, whether they have terms of use restrictions on accessing your own data. So we have, there's a big grid on there and it rates.

• 12:38Martin Casado?

  Are you comfortable saying who the worst offenders are? Well, or should you just point people?

• 12:44Speaker 00

  Just, just go to the website and read it. It's all very fact based and very, uh, well, well, evidence. I mean, the worst offenders historically have been, uh, SAP has always been really bad.

• 12:56Martin Casado?

  I mean, even when I was running a large business, I mean, that was, that was.

• 12:59Speaker 00

  It's interesting because they were getting better and I've sensed in the last few years that there's sort of two camps within SAP, one of whom who regards it as it's the customer's data, the customer's got to be able to do what they need to do with their own data. And then there's sort of the old guard who views it as SAP's data and you'll do with it what, what we tell you to. And, uh, and, and then, you know, historically Salesforce has been really good with the exception of Slack where they are terrible.

• 13:28Martin Casado?

  Yeah, I know.

• 13:29Speaker 00

  But, uh, they've started to get squirrely about this. So it's, it's a moving target. I am hopeful that this is merely a brief flirtation with closed data by most of these vendors and they will realize this is not a good idea, that they are at war with their own customers and it's not even going to work anyway. And we will go back to the trend towards ever more openness.

• 13:50Martin Casado?

  You just answered my next question, but I'm asking anyways, which is like, do you feel like this is just like a, a repeat of the open data API? It'll resolve quickly, like, you know, we always kind of go through this soul searching and then we will resolve back to where we were, which is like open data is the right thing. I do think so. Do you think that's the path or do you think it's different?

• 14:07Speaker 00

  Yes, I think it will be the same. That's my prediction. It will be the same path as vendors will discover that they cannot provide inside their own platform, a solution to every data problem that their customers have because they are simply so diverse. And instead they simply create a mechanism for the customers to, to replicate it to their, to their data platform of choice, uh, and, and do with it what they will. And even if they charge fees for that, it's not the end of the world. On opendatainfrastructure.com, you really get yellow for charging fees. So, you know, it's only red when you try to actually block it. At the end of the day, if you want to have a little toll, that's not the end of the world. The problem is when you start, um, When you start actually blocking it.

• 14:47Martin Casado?

  Like there is no option.

• 14:48Speaker 00

  And, and saying, oh, if you want to do anything with data, you have to come use my tools inside my walled garden, which never works because all the rest of your data is not in that walled garden. And it's not going to be. And, uh, and you can never create enough tools to support all the different things customers want to do with data.

• 15:05Martin Casado?

  You know, this is probably related to this notion of, of, of, you know, or this belief in data gravity. And I mean, one thing that I've loved working with you over the years is like, you're exceedingly smart and you're exceedingly contrarian. So fun to like, kind of, you know, watch your opinions diffuse and more often right than wrong. And one thing you have said is that data gravity is either overrated or not real. So do you think that like, A, you know, do you stand by the statement? And B, do you think that this is driving people to like, try to do these wall gardens?

• 15:37Speaker 00

  I, I think data gravity is completely fake. I am the only person who thinks this.

• 15:43Martin Casado?

  You're the only person.

• 15:44Speaker 00

  If you want, if you want to see evidence.

• 15:46Martin Casado?

  Maybe describe what data gravity means.

• 15:47Speaker 00

  Data gravity.

• 15:48Martin Casado?

  People use the term a lot, but like, I don't think they understand the implications.

• 15:51Speaker 00

  Data gravity is the idea that, uh, business data is so large that it's very expensive to move around because of egress charges, uh, of cloud vendors. And, uh, if you want to see, and, and that therefore it's very important that you choose a, a physical region in the world where all your data is going to live in a specific, uh, region of a specific cloud. And then you build all of your data consuming services in that same location. Or you can partition it.

• 16:23Martin Casado?

  Strictly because of egress fees.

• 16:24Speaker 00

  Well, this is, this is A version. The term data gravity does get used to mean multiple things. This is, this is one particular incarnation of the idea of data gravity. And this is the one that I am saying is fake, that egress charges are so important.

• 16:39Speaker 00

  And if you want to see evidence against this, come look at the networking dashboard of five trans various AWS and GCP accounts. You will be astonished despite replicating, uh, huge data sets for, uh, thousands of companies. We have, uh, 7,000 customers of size and thousands more little ones.

• 17:00Speaker 00

  The the the amount of data being moved at any given time is tiny. And the reason is that we're doing change data capture. You can have a huge data set, but if you just replicate the changes, the changes are always much smaller than people think. And I think that a lot of this idea of data gravity came from dumb data pipelines that people wrote, where they would copy their entire company's data sets out of their database every day, once a day at midnight. And so they just had this crazy read amplification. You know, they were just repeatedly copying the same data over and over. And it gave them the impression that they had so much data, but they really don't.

• 17:39Martin Casado?

  May be a good argument not to roll your own on these things anyways.

• 17:42Speaker 00

  Yes, yes, this is what happens when people roll their own data pipelines is they fall back on these patterns that are easy to get right. Like that that pattern I just described, it's extremely easy to get a correct replica just by copying it all over and over. But very expensive to operate in the long run.

• 18:03Martin Casado?

  Maybe before we leave this topic, so let's say there's a CIO listening to this right now. And the CIO is like, oh, how do I navigate these kind of uncertain three to six months? Like, what kind of leverage do I have with these SaaS vendors as they're closing things off? Do you have any sort of guidance for them?

• 18:17Speaker 00

  Yeah, I think, number one, you should insist on having a copy of all of your own company data in a data lake that you control. Don't let go of that for any vendor. You have a lot of leverage. These vendors actually have a lot of obligations to let you do that. The reason why they get away with blocking people is simply because people don't fight.

• 18:43Speaker 00

  So pick fights and write it into your into your, if you have big contracts with vendors and you're redlining your MSAs, write language guaranteeing your own data access into those MSAs.

• 18:57Martin Casado?

  Are you are you seeing those show up now? Actually, I hadn't even considered that.

• 19:01Speaker 00

  We have model language on opendatainfrastructure.com that we recommend you incorporate into your MSAs. And even if you don't get it, just by asking for it, you are sending a signal. So, you know, if you if it's a $10,000 contract, don't don't do it. But if you're if you're signing, you know, 500K million dollar contracts insists on data access in your MSA. And you will find surprisingly often that you get it.

• 19:32Martin Casado?

  I want to talk a little bit about agents now. So I feel like we've kind of gone through multiple phases already in agents. So the first one is they're just purely treated as software. They're like, it was almost like search plus plus, like take all your data, put it into a data lake. And then you have an LLM that has access to it. And then we go to that and it's like enterprise search all over again. And then we went to like the agents like, like OpenClaw. And then that model is like a personal agent, but it kind of like was part of you. So you'd give it access to your email and you would give it access to like your API keys and give it access to your accounts. So it was like part of you and extension of you. Now we're saying-

• 20:12Speaker 00

  I actually set up OpenClaw.

• 20:14Martin Casado?

  That's great. I use NanoClaw.

• 20:16Speaker 00

  Well, I set up OpenClaw and then I turned off of it onto NanoClaw.

• 20:19Martin Casado?

  Yeah.

• 20:20Speaker 00

  Because it's such a monstrous-

• 20:21Martin Casado?

  Yeah.

• 20:22Speaker 00

  Piece of over complex software. And then I actually turned off NanoClaw onto NanoBot, which is what I've stuck with. But I use it to manage my tennis team, but it has its own identity.

• 20:31Martin Casado?

  Okay, so no, no, this is what I was gonna say.

• 20:32Speaker 00

  It has its own email.

• 20:33Martin Casado?

  So this is, I think we've all come to this conclusion, which is like, I don't want it having access to my email. I want it. So I also, I also have the Mac mini. I run, actually now I'm working with somebody like Build a Harness, but like, they're all the same, right?

• 20:46Speaker 00

  I run on a VM.

• 20:47Martin Casado?

  Yeah, perfect. Yeah.

• 20:48Speaker 00

  It's got its own WhatsApp number, its own email address.

• 20:50Martin Casado?

  So I got it own phone number, its own email address. And then, you know, now as we think about A16Z, we're actually thinking about like, you know, why don't, why don't we just treat all these agents like this? Like we'll actually have an HR and that HR team will onboard AIs as they come. They will train them. They will show them the access to the documents that you need. They'll be part of teams. They'll join the Slack, you know, just like humans do. And in that world, and we touched on this a little bit before, but in that world, these aren't software. There's actually more seats, more consumption of software. And so do you think that for enterprise agents, we're moving more to these, you treat them like humans? Or do you think that that's too far?

• 21:28Speaker 00

  Uh, I think it is a intermediate form. I think the reason this works well is because you can slot it in to the existing workflows without having to refactor the whole universe.

• 21:41Martin Casado?

  Yes.

• 21:42Speaker 00

  So in my example of my agent that manages my USTA tennis team, it can email with the players, it can go to the USTA website, check the schedule, make lineups, check availability. And it works well having its own identity because it can slot into all of these existing workflows that were designed for humans. At Five Tran, we have an AI agent that helps respond to support tickets. That goes and inspects the logs, inspects the code. It uses all the context that we centralize with Five Tran to find out what is going on with this customer, what might be the solution to this problem. And it drafts responses.

• 22:27Speaker 00

  And right now, it slots into the system a lot like a person would. But we are working on making the whole thing just a closed loop, pure AI system, where it will only have one identity. There will just be the connector troubleshooter Borg hive mind.

• 22:48Martin Casado?

  And there may be, but I mean, let me give the argument for the multiple. So, so why, why do I use a Mac Mini for my, my agent? Right? I mean, there's a couple of reasons. One of them, so it can access iMessage because there's no programmatic way to access iMessage. And so like, you know, it has a desktop. Another one is like, everybody's moving headless, like Salesforce is doing their headless thing and there's a headless browsers. But it, it turns out, let's just talk about browsers. Like if you have a headless browser, all of the anti-scraping software kicks in and then like it's not as functional. So it's actually much better to just give it a fully functional version of Safari. So you could argue that the interfaces that have evolved over the last 30 years to deal with unpredictable.

• 23:32Martin Casado?

  Users that know how to use computers is the UIs we have today. And actually, the simplest thing to do, rather than try to rewrite all of that stuff, is just to give these agents that have been trained on human data access to full end-to-end systems.

• 23:45Speaker 00

  I don't know, the systems that I've worked on, browser use has never been necessary. Browser, browser use has a big cost, which is very slow.

• 23:55Speaker 00

  And it consumes a lot of tokens.

• 23:57Martin Casado?

  Yes.

• 23:58Speaker 00

  And I have found that in my tennis example, the USGA website does not have any anti-scraping provisions.

• 24:06Martin Casado?

  Okay. You're not trying to, you're not trying to like read from LinkedIn or Zillow. Try that.

• 24:12Speaker 00

  Yes.

• 24:15Speaker 00

  And so I'm just using, I'm using just like Python browser automation. I'm actually using Selenium. And then I'm actually, there's actually a skill that emits just, just exactly what you want to know, so that, so that the agent is not reading HTML and consuming all those tokens all the time. And then at FiveTran, for example, we are working right now on a Salesforce administration agent to, to integrate, to basically do continuous integration of small changes into our Salesforce, which is very labor intensive right now. And it also does not use browser automation because the Salesforce CLI, we found, does everything we need to do. We'll use browser automation if we need to, if we come to something that can't be done

• 25:00Speaker 00

  with a Salesforce CLI, but to their credit, the Salesforce CLI is quite comprehensive. Pretty much anything you can do in the UI, you can do with a CLI command. And the agents seem to already know how to use it.

• 25:11Martin Casado?

  So can I do a $1 bet with you for when we're on this podcast in five years?

• 25:14Speaker 00

  Sure.

• 25:15Martin Casado?

  I think the majority of use for agents in five years is going to be the same interfaces that humans are using, just because it's a long tail of integration has already been solved and like all the protections and all the sharing and everything else. And, and would you say the majority would be through APIs that are kind of more of a, more of a traditional computer software system?

• 25:35Speaker 00

  Yeah, I think they'll just hit the APIs.

• 25:37Martin Casado?

  What do you think about things like, you know, these, these technologies that mediate now like MCP, which have emerged to kind of try and solve that problem? Do you think there's a future for those? Or do you think that those just give way to like strict tool API usage?

• 25:49Speaker 00

  You know, in theory, it seems like there are an unnecessary layer. Because these agents are great at calling APIs and calling command line tools. So why bother having this other layer? In practice, when you sit down and actually try to build systems, MCPs do solve important problems, particularly authentication.

• 26:09Martin Casado?

  Yeah.

• 26:10Speaker 00

  And just like discoverability of what's available. So even though you can say kind of from first principles that maybe they shouldn't exist, when you actually sit down and write a real system that's accessing context, you almost always end up sticking an MCP server into it.

• 26:24Martin Casado?

  And this is authorization, authentication, authorization and discoverability, like the fact that these things exist.

• 26:31Speaker 00

  Yeah, and there's just also a lot of little affordances in the AI tools that are built around MCP. Like, uh, um, user, user granting authorization for specific tasks are done at the tool level in MCPs. And that's just a rule that's been baked into the harnesses that ends up working well for a lot of situations. It also works badly in some situations. But the, the, the tools on the consuming side have started to grow around MCP.

• 26:58Martin Casado?

  Yeah.

• 26:58Speaker 00

  And thus, even if maybe theoretically you don't need it, I think in practice, it's, it's taking, it's taken hold.

• 27:04Martin Casado?

  And the thing that I find so strange about this is like even the tool use itself, like you could argue that like as smarter models come out, they could build better tools anyways. And so sometimes I wonder if like, like an agent should just be the most minimal thing ever. Like it manages like durable state, it manages compute. And then, you know, you run like whatever, like the Anthropic SDK or the OpenAI SDK. And then you just tell it to build its own tools, like, you know, build your connection to this.

• 27:30Speaker 00

  Well, that's how Nano, that's how Nano Claw works.

• 27:32Martin Casado?

  Exactly how it works right now. But you could argue that like, there's so much money being poured into these foundation models, like tens of billions of dollars, maybe come hundreds of billions. So the most intelligent thing at any point on the planet is one of these models. So why would you use an old tool if it could build a better tool?

• 27:45Speaker 00

  Yeah, so I mean, Nano Claw, for those who don't know, is a personal AI agent, sort of like Open Claw, except the way it works is you fork. The repo when you start up.

• 27:54Martin Casado?

  Yeah.

• 27:55Speaker 00

  And then you just sort of vibe coded into whatever.

• 27:57Martin Casado?

  Yeah, whatever you want, exactly.

• 27:58Speaker 00

  And the problem I encountered is it sort of went awry. And I didn't really want to go and troubleshoot all of the details.

• 28:04Martin Casado?

  I debugged Nano.

• 28:06Speaker 00

  Yeah, exactly.

• 28:08Martin Casado?

  Curse, I'm in there like.

• 28:09Speaker 00

  At some point, I spent enough time debugging Nano Claw that I was like, I want something that has more separation of concerns. Where there's sort of an agent over here that has an API and it works the way it works. And then I just write like skills and stuff on top of that. Ironically, even when I did that, I ended up having to add things to Nano Bot because like it couldn't differentiate WhatsApp group messages from DMs. And I think I actually have a PR against Nano Bot because of that. So I sort of ended up back in the same place a little bit. But I take your point, like if they get smart enough, they may, uh, you know, they may just build their own intermediate abstractions as needed.

• 28:44Martin Casado?

  Yeah, that's right. Yes, you go. Just to maybe wrap this this bit up. I mean, you know, Satya has said that there's going to be the collapse of SaaS. And, you know, we know Databricks is trying to rebuild a lot of SaaS on top of their platforms. I mean, they've been very public about that. So do you think we're going to see like a massive, like, do you think the SaaS apocalypse is a thing and we're going to see a massive shift? Or, and like, you know, it's going to be agents and it's going to be on new types of infrastructure that they run? Or do you think that, you know, SaaS is fine, the markets are overblown, Satya is, you know, wrong?

• 29:23Speaker 00

  Well, to give credit to the public markets, I, I think that they are accurately. I mean, whether the magnitude is right, I cannot say, but the direction is right. There's a lot more uncertainty embedded in all these SaaS companies.

• 29:35Martin Casado?

  Yeah.

• 29:35Speaker 00

  Including my own than there was a year ago. And that's reflected in the changing, in the, in the decline prices. But I, I don't think it's for this, I don't really buy into this reason.

• 29:48Martin Casado?

  Yeah.

• 29:48Speaker 00

  That all these SaaS categories are going to disappear and be replaced with vibe coded software. I think there will be some, but I think the bigger threat is simply new companies coming along. It is just so much easier to write software.

• 30:01Martin Casado?

  More native, yeah.

• 30:01Speaker 00

  Now that AI native companies will just zoom and catch up to.

• 30:07Speaker 00

  To the established incumbents and maybe be better in some ways.

• 30:11Martin Casado?

  You know, it's so interesting. I mean, you just you just mentioned that about about five tran, but if you look across the companies we work with that are traditional companies, and I wouldn't, I actually would not include you in that. But I mean, listen, you know, like, both of the labs are are your primary customers. But if you look at it across the traditional companies, like, you don't actually see in the data that they're slowing down, like, five times doing great. It's actually the company is accelerating. And so how do you reconcile this high risk concern that you just voiced with the actual, the business? Is it more just kind of existential angst?

• 30:43Speaker 00

  No, it's like X risk, you know, some, some, some new way of doing what you do comes along that's dramatically better. And this will happen to some.

• 30:51Martin Casado?

  I know, of course it will, right? But

• 30:53Speaker 00

  And and more.

• 30:54Martin Casado?

  We're four years into this at this point.

• 30:55Speaker 00

  Yeah.

• 30:56Martin Casado?

  You know, I don't know. I just feel like you do. You can't derive this from the data as far as I can tell. And like, maybe it's coming.

• 31:03Speaker 00

  Yeah, it's not even really in the public company data.

• 31:06Martin Casado?

  No, it's not. No, yeah, across the board.

• 31:07Speaker 00

  It's when you start to see, like, less than one net dollar retention, then you know, it's, it's, it's come.

• 31:15Martin Casado?

  Yeah, yeah, for sure. Yeah. And maybe it will. Maybe it's in the future. But like, we've been having this conversation. I remember, I actually remember when I was when you put in the call, and it was a year ago or so. And you're like, Martine, this AI stuff is like, really real. And, you know, like, you can kind of code connectors with it pretty good. And it's pretty good. And it's coming. But that was actually quite a while ago when you put in that call. And the company's done fantastic since then. So it could be the case that, like, rather than someone trying to redo an existing company that, you know, has figured out like, a long tail of stuff, they'll go work on different problems that are more suitable.

• 31:46Speaker 00

  So we have, you know, in our particular case, we have been trying ourselves to use AIs to build data replication connectors, which is the core of what we do for years since GPT three. And They they continue to improve in terms of what they can put out. They still do not discover this long tail of complexity. It is, it is, it really surprises people how difficult it is just to make an accurate copy of a system and keep it up to date. And so, and, and, and now we are actually starting to see new capabilities inside Five

• 32:27Speaker 00

  trying to push the bounds of quality, particularly quality even further, like, like completeness of coverage of the sources and the correctness of replication. You can imagine how you can use AIs to do that more comprehensively than you ever could with human beings. And so I, I think in addition to the sort of, you know, the AI threat is getting closer, but it's still, it's still, I think a ways away from what we do. We're actually starting to see the opportunity pull us forward. So we're, we're starting to get better at our own core business by leveraging AI internally in extremely non-obvious ways that I don't think anyone else has, has discovered yet. Can you just, can you talk to those or is that a great secret?

• 33:12Speaker 00

  Uh, well, it's, it's, um, you know, at the end of the day, uh, what's going on inside Five Tran is just this crazy mass troubleshooting effort that never ends. That sounds like every startup ever. Well, we have, it is, but it, it's, it's the, the breadth of it is much larger for us because we have 750 connectors to different systems of record, everything from Oracle to SAP to Qualtrics to you name it. They all have different idiosyncrasies and you only discover these idiosyncrasies when real customers bump into them and they show up as performance problems, correctness problems and failures.

• 33:55Speaker 00

  And, you know, the way we have, have always solved it is I always like to say, the trick is there is no trick. It's just a lot of effort behind the scenes and it's kind of an economic trick. We only have to fix every bug once and then every customer who uses that connector benefits from it. But you can imagine how you can use AI coding agents, which are basically an infinite supply of junior engineers. That is a particularly valuable tool. For this kind of problem. And the details of putting that into practice turn out to be quite tricky. But we've really, especially the last couple of months, started to see at work and started to see,

• 34:37Speaker 00

  you know, like, like improvements at scale. Many, many, many small improvements start the, we've seen the flood start to come. And I think you'll see the quality and reliability of Five Tran take yet another leap this year because of that.

• 34:53Martin Casado?

  You know, you're in this very unique vantage point because you have the big labs as customers like OpenAI and Anthropic are customers. So, you know, they are AI native, they're at the forefront. Do they use Five Tran differently than traditional enterprises or anything that the enterprise can learn from that?

• 35:11Speaker 00

  No, their use cases are very typical. They use Five Tran to replicate data from lots of different systems of record into, into a centralized data lake. And they do analytics with that. They feed that as context into their own internal AI workflows. So they, they have built data foundations that look very much like the data foundations of many other companies. The data, the, the systems at Anthropic, one of the people who helped set them up was a consultant who had set up Five Tran and DBT at many other companies. So their, their, their data, their data platforms look very typical. And I think this is a very important message.

• 35:52Speaker 00

  If you are thinking about data foundations for AI, do not make the mistake of thinking you need to build some exotic new system as a data foundation for AI. The right data foundation for AI is probably the one you already have. If you have a reasonably modern data platform, something like Snowflake, Databricks, or BigQuery, or maybe even you have transitioned to an iceberg data lake with those compute systems running on top. That is a great foundation for your context for AI as well.

• 36:26Martin Casado?

  You know, there, there used to be this idea, and again, we've touched on in, in the context of Five Tran, but more broadly, there's this idea that AI commoditizes infrastructure broadly, right? And so the idea was like, well, it can write anything. The opposite seems to be true. More software is being written than ever before. The software is actually pretty buggy. It needs kind of stable infrastructure below it, you know? And so most infrastructure companies have seen a lift as a result of this. You know, in your, in your sense, is this transitory like the eventual AI consumes infrastructure is coming? Or do you actually, I mean, let me just give you my, my, my quick view on this, which is I'm building rock solid software that you can operate for long periods

• 37:08Martin Casado?

  of time is just not what AI is best at. And you're probably better spent, you know, focusing it on other things. But is my view blinkered in like how powerful it's going to get over time?

• 37:19Speaker 00

  No one knows how powerful it will get over time. I mean, the nice thing about that is that if it gets sufficiently powerful, all these questions become sort of moot because we'll just be living in a post scarcity world. But I think if we look at, at the present day, I think it is mostly true that AIs are just creating more demand for infrastructure and not commoditizing it at all. You can think of infrastructure as having layers and at the bottom are like data centers. And then, you know, you go to cloud vendors like AWS and then you have systems like Convex, sort of serverless platforms that try to make the cloud vendors easier. And then you even have, you know, systems that sit at

• 38:00Speaker 00

  a higher level of abstraction than that, which could include, you know, Databricks, a lot of their business is hosting notebooks, right? I think that last layer is the one that is, is threatened by AI.

• 38:15Martin Casado?

  Yeah, the consumption there, yeah.

• 38:17Speaker 00

  Yeah, AI is, is quite good at navigating slightly more complicated infrastructure. So if you have an AI agent, maybe you don't really need that very most user friendly layer. You can drop down to the next one and use that.

• 38:34Martin Casado?

  Yeah. I mean, you could argue that whenever the consumption layer is up for grabs, which also happened with the internet, right? Like you kind of went to different places to go do things. Like it changed the UI, like it changes a bunch of stuff. But like the core infrastructure stays in place, right? Like you still have operating systems, you still have chips, you still have databases and like you did, they kind of evolve over time rather than they get.

• 38:55Speaker 00

  Yeah, maybe you peel one layer or maybe you peel three.

• 38:58Martin Casado?

  Exactly.

• 38:58Speaker 00

  You're not going to peel it all the way back down to glass.

• 39:01Martin Casado?

  Yeah, that's right. Let's talk, let me actually just do a quick time check here just because. I just enjoy talking to you so much. We can just talk forever. Okay, let's change topics a bit to the DBT merger.

• 39:15Speaker 00

  Yeah.

• 39:16Martin Casado?

  So you acquired Sensus in 2025 and then Tobico Data and SQL Mesh. And then you signed with DBT Labs. And so, I mean, this has always been a space that's been relatively acquisitive. But I would say for the new style companies, FiveTran has been the most acquisitive. So maybe can you talk through the strategy and the plan? Or is this ad hoc? Is there some grand strategy?

• 39:43Speaker 00

  Well, I am the child of investment bankers, so maybe I'm just realizing my destiny.

• 39:48Martin Casado?

  Not just investment bankers, PE, right?

• 39:52Speaker 00

  Well, my brother did PE and my cousin and a bunch of other people in my family. But not my parents. My mother was a commercial banker and my dad was an M&A investment.

• 40:01Martin Casado?

  Oh, there you go. Okay, M&A wells.

• 40:04Speaker 00

  Yeah, but in the

• 40:05Martin Casado?

  Between P and M&As. Okay, I see. But anyways, I got you. Listen, for a startup and having watched you do it has actually been very impressive to watch you run the strategy.

• 40:13Speaker 00

  Well, but seriously, it was not something we set out to do. FiveTran does not have a corp dev function.

• 40:22Speaker 00

  I felt with every single

• 40:24Martin Casado?

  I never really thought about. That's true.

• 40:25Speaker 00

  Yeah, I've always felt that any acquisition or merger, and the first big one was really HBR.

• 40:33Martin Casado?

  HBR, yeah, I remember very well.

• 40:35Speaker 00

  It should feel like it's for these unique reasons. And it feels like it's the last one you're ever gonna do. And it's not gonna be the last one you ever do, but the reasons to do it should be really, really strong. You shouldn't go looking for this. Nonetheless, we have found these strong reasons several times. I think the DBT one is a great fit. These are two products that have historically almost always been used together. And they kind of go together. A FiveTran is the tool that gets all your data in one place. DBT is the tool that you use to organize it and turn it into a model that reflects the particular details of your business.

• 41:17Speaker 00

  And then that is what feeds into all of the data consumers.

• 41:21Martin Casado?

  You've actually said publicly that DBT is going to be one of the biggest beneficiary of coding agents. Can you kind of pencil that out a bit?

• 41:29Speaker 00

  Yeah, yeah. So there's this great-

• 41:31Martin Casado?

  I don't even really know what that means.

• 41:34Speaker 00

  Well, I think there's going to be way more usage of DBT. I think coding agents are going to write tons of D U T models.

• 41:40Martin Casado?

  I totally, we're actually already seeing that. I mean, that's-

• 41:42Speaker 00

  Yeah, and it's going to be a great beneficiary. There is this great

• 41:49Speaker 00

  quote from Dykstra, I think, which is-

• 41:52Martin Casado?

  Dykstra's algorithm, Dykstra?

• 41:53Speaker 00

  That, yeah, that computer code should be seen as a means of communication between humans and only incidentally as an execution format for computers. And nowhere is that more true than in SQL queries in DBT projects. It is a great way to express, these are the rules of data at my company. And even if it's being written by AIs, you still want to have that artifact that is executable documentation of how your business works.

• 42:24Martin Casado?

  All right. So you have the pleasure of being the CEO of a relatively large company during the AI wave. You've gotten back to writing coding, which a lot of us have. You're running a lot of experiments, like you mentioned, experiments, your Nano Claw experiment. Though you're now running what?

• 42:41Speaker 00

  NanoBot.

• 42:42Martin Casado?

  NanoBot.

• 42:45Martin Casado?

  So how much of this is, you know, George, the scientist, the techie versus like you actually do this pragmatically useful for the CEO of a large company?

• 42:54Speaker 00

  Yeah, I don't know if it's a good idea. I just can't resist. And coding agents are great for CEOs who want to write code on the side because they work sort of asynchronously. So you can have a lot of things spinning in the background. I have a lot of projects going right now.

• 43:09Martin Casado?

  Can you name them? I mean-

• 43:11Speaker 00

  I mean, I have things I am just doing as hobbies, like-

• 43:17Speaker 00

  Uh, like the system for managing my tennis team. I'm working on a little on a tennis statistics machine vision app. But then I have many things at five train. They're all experimental proof of concepts that I share with people. And we talk about, um, there is a, um, a potential like nano data lake catalog, uh, that I have going that attempts to if you, when you use data lakes, you have to adopt this additional service, uh, called a catalog. And it's the answer to the question, could we make the catalog invisible? So that's an example. I'm working on just for the hell of it, uh, a from scratch, uh, classic OLTP SQL database.

• 44:02Martin Casado?

  What?

• 44:03Speaker 00

  I, I think, I think there is an, well, it's crazy. It's crazy, right? But it, it, the whole point of the project is no, no, it's not distributed.

• 44:13Martin Casado?

  Yeah.

• 44:14Speaker 00

  It, it, it's, it's what it attempts to do is to be, uh, like SQ Lite, except S3 is the backing.

• 44:23Martin Casado?

  Oh, that's cool. That's a great idea.

• 44:24Speaker 00

  For it. Because when you build AI workflows, you have this need for like zillions of tiny databases. And, uh, it's a proof of concept. It's mostly an exploration of like, could you with sufficient AI coding, just take on something absolutely ridiculous? If you're hearing this and you want to work on this and you are an expert in databases.

• 44:46Martin Casado?

  Public GitHub?

• 44:47Speaker 00

  I don't, I don't. But if you want to work on this, come to, come, come talk to me. And maybe you can come do this at five train. You don't even have to use my proof of concept. I think there's actually a real opportunity, right? At this moment, I, I really lament that we're sort of stuck with Postgres forever. Postgres, contrary to popular belief, is very old technology. It is not a good database. Undergraduates writing class projects write better databases than Postgres. Not because the people who built Postgres were not smart, but simply because it was written a long time ago. It has a lot of technical debt. And I really think the world should create a new operational database rather than just endlessly repackaging, uh, Postgres. But.

• 45:28Martin Casado?

  That's an amazing take.

• 45:31Speaker 00

  Yeah, that's another one of my country. Postgres is bad, actually. I should also say.

• 45:36Martin Casado?

  No, no, even better, like an undergrad in a database course is writing better databases than.

• 45:42Speaker 00

  In in many respects, the storage engine that you would write as an undergraduate in a database course is better than Postgres's heap storage engine. And Postgres's storage engine, I don't think the creators, the people who who promote it today would admit it is not a good design. It's been patched up in a lot of ways. But the the Postgres, the Postgres storage.

• 46:03Martin Casado?

  Yeah, I'm not, I'm not going to digress on this a million questions, but but I will say, just like this conversation, you ever find this becomes a bit of a distraction, like? It is so dazzling and so fun and so exciting to work on these things. And you're like, oh, you know, I should be like doing that one on one, but instead I'm here in my.

• 46:19Speaker 00

  No, I think about that a lot and I make, you know, you gotta, you gotta like, keep it at bay. Because it is like, you know, there is a danger of Claude psychosis, which is a term that I I love, but you can just get sucked in. But, you know, I have a lot of time. I don't have any kids, so I have a lot of time. People with children will will say that's like, it's like having a whole nother self.

• 46:44Martin Casado?

  Yeah, yes.

• 46:44Speaker 00

  If you don't.

• 46:45Martin Casado?

  Trust me, and I do. Yeah, yeah. I mean, one thing I do, I do really appreciate about you as an executive is this, you as a founder, is you're actually quite reflective. And one of the mental exercises that you've been doing as long as I've known you was like, pretending if you were a new CEO brought in by the board to fix Five Fran, like, what would you immediately unwind, which is the way it always happens when you bring in a CEO? And I know you kind of do this mental exercise. So is there anything recently that you've thought, like, boy, if I was brought in to like, run things, I would change this?

• 47:17Speaker 00

  Many things. I, that's an exercise I I do regularly. I'm trying to think of a recent example. I mean, a not so recent example is I did do some things to try to simplify pricing. I think those have been successful. They were painful for the company because they mostly cut prices for small customers. Another exercise I do is I ask myself, what should other CEOs do? It's hard. It's a, it's a trick to get yourself. To do things that are big and scary. So in the DBT merger, you know, when I was reflecting on that, on whether that was a thing we should seriously consider. One of the tricks I use is I ask myself, what should, what should Serata do? Serata is the CEO of Snowflake, who we've worked with for a long time. It's a good mental exercise.

• 47:58Martin Casado?

  Oh, yeah.

• 47:58Speaker 00

  And then I just go do that. And, and that was like a clear answer in my mind was like merge with DBT. Absolutely. By that, by that framework, even though it seems very big and scary. When you imagine, is this a good idea for someone else? Then you can kind of get there.

• 48:14Martin Casado?

  Yeah. Maybe just kind of a softball cliche final question. But, you know, you do have like the, the unique perspective of managing a CEO during this transition. So first, what are you most kind of existentially worried about? And second, what are you most excited about?

• 48:31Speaker 00

  Well, I think the thing I most worry about is just, you know, that the,

• 48:37Speaker 00

  at some point, the coding agents will get so good at writing connectors that people will just shift to DIY. I think that's a real threat to Five Train. I think some different businesses are more and less threatened by like, maybe the customers will just vibe code it themselves. That is a thing I worry about with Five Train. And we, we will, we will find a way to thrive in that world if we get there. And we, we, we will provide the tools that you use to do that. If that indeed becomes possible, even if it comes at a short term cost to ourselves. But I do worry a lot about that. And then the, the biggest opportunity I think is that AI is just a whole new set of things to do with data.

• 49:21Speaker 00

  The need for getting all your data in one place, organizing it is so much greater now than ever before. I think that there's a whole set of tools that people are going to need on the other side of that data platform. And I think we, and especially we and DBT are perfectly positioned to provide them.

• 49:42Martin Casado?

  Amazing. Well, it was a pleasure to have you, George. Thanks for coming.

• 49:45Speaker 00

  Good to see you, Martine.

• 49:49Erik Torenberg?

  Thanks for listening to this episode of the A16Z Podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or review, and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts, and Spotify. Follow us on X at A16Z and subscribe to our Substack at A16Z.substack.com. Thanks again for listening, and I'll see you in the next episode. As a reminder, the content here is for informational purposes only, should not be taken as legal, business, tax, or investment advice, or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any A16Z fund. Please note that A16Z and its affiliates may also maintain investments in the companies discussed in this podcast.

• 50:33Erik Torenberg?

  For more details, including a link to our investments, please see A16Z.com/disclosures.