⚡️Satya Nadella: No Priors x Latent Space Crossover Special at Microsoft Build

**SPEAKER_2** (0:24)
Please welcome Swyx, Sarah Guo, Elad Gil, and Chairman and Chief Executive Officer of Microsoft, Satya Nadella.

**Elad Gil** (0:41)
Hello, sir.

**Swyx** (0:43)
I'm so excited to be here. Welcome to a crossover episode of No Priors and Lane Space with Satya Nadella. Congratulations on an amazing build.

**Satya Nadella** (0:52)
No, thank you so much, and it's great to be with both of you. I listen to both of you or both the podcasts all the time. It's great to be on it.

**Swyx** (0:59)
Thank you so much. So you're just talking about these amazing announcements from across the Microsoft estate all morning for I think three hours. What's the most important reflection or takeaway you have?

**Satya Nadella** (1:09)
I'd say there are perhaps the biggest one for me is, let's conceptualize this more as an ecosystem play as opposed to a single model or even a single platform. Whatever, at least for me, having grown up at Microsoft, having seen whatever four major platform shifts, I fall into that camp where a platform is defined by fundamentally its ability to create more value about the platform versus what's captured in the platform.
So if you view what's happening right now, I think this morning's keynote was, how can any company, whether it's an AI native company or a traditional enterprise company, participate as a first-class participant where they can point to AI, they create, right? It's not that they don't use other people's AI. Of course, they will. But to me, what's the path? What's the recipe? How do I do it? What does a stack look like? What does the tooling look like? What is valuable? How do you do that? That's it. That's our job to do.

**Swyx** (2:16)
Yeah.
Ecosystem strategy is very complicated, right? Because you end up building certain components, partnering for certain components, supporting them. You just announced this big suite of models. Can you tell us a little bit about the training strategy for Microsoft now?

**Satya Nadella** (2:30)
Yeah.
The thing that we wanted to do with the MEI models was to build and as Mustafa talked about, first of all, a great lineage, right? Starting with pre-training, with very good data quality, doing all the ablations, making sure, because in some sense, it's becoming even harder to build a clean lineage model. Just because there's so much stuff out there, that you truly need to ablate out to be able to have a fantastic pre-trained model. In fact, that's one of the challenges of a lot of the open-weight models is, they look great on one benchmark or two, but they're not great on practice. So, that's why, in fact, even in the RFDEs are pretty gone, really excited about these MEI models, because how the heck can a small 5B model hill climb, and it goes back a little bit to what I think is ultimately the key thing to do, which is try to pursue finding that cognitive core. So, to me, starting with a clean lineage, then creating that ability for companies to be able to use this, not just as a generalist, but to create their own specialist by building this hill climbing scaffold around it. So, it's not just the model, but you have a hill climb scaffold around it, then you will start building your RLE. You will start collecting the traces. Most importantly, you'll have private evals, because we know all the evals out there are good, interesting, but they're not really that critical at this point, because they're all can be maxed. So, the point is each company will have its own private eval. So, that end-to-end platform story around our models is what I think is interesting. And then, the one other thing, Sarah, since you brought that up is, I do feel there's a new frontier. Like, people talk about the frontier, and are you operating at the frontier?
Interestingly enough, if you add a little temporality to it, you can use, let's say, in fact, the Lando Lakes demo we showed was pretty cool. We used whatever, GPD 55, right? Then, you collected a bunch of traces, and then, you took a 5B reasoning model and achieved higher. So, that is another aspect of what it means to appear, operate at the frontier.

**Elad Gil** (4:46)
Yeah. I think, first of all, I have to congratulate you on basically building a frontier NeoLab inside of Microsoft in two years.
I'm wondering, you have all this AI strategy that you're rolling out. By running, what do you know now that you wish you would tell yourself two years ago or two or three years ago, three years for the Jensen partnership, two years for MEI?