The FDE Playbook for AI Startups with Bob McGrew

In plain English

Bob McGrew helped build Palantir, a software company that sells to governments and large organisations. He explains its “forward deployed engineer” model. These are software engineers who work on the customer’s site and close the gap between what a product does and what the customer needs.

He says this has taken off with AI agent companies (software that carries out tasks on its own) because there is no established product to copy. Nobody yet knows what these tools should look like, and you can only find out from inside the customer’s business. He also warns that done badly, it is just consulting.

Three ideas worth keeping

• The engineer’s job is to build a rough “gravel road” for one customer, then the product team turns what works into a “paved highway” for the next ten.
• You sell a solved problem, not installed software, so contracts should grow as you solve bigger problems for the same customer.
• Aim at one of the boss’s top five priorities, or nobody inside the customer will have the energy to see it through.

What it means for your business

Judge any technology partner by whether they will work inside your operation and own the result, not by the demo or the proposal. Start with a problem your leadership already cares about, because that is what gets people to cooperate.

Expect the first deployment to take the most work, and expect later ones to get easier if the partner is building something reusable.

What it means for software teams

Custom work for each customer is fine, as long as the lessons flow back into a shared product. McGrew says the failure modes are drifting into a pure consulting shop, or building what one contact finds easy rather than what matters. He suggests measuring the value of the outcome delivered, not how much custom work each customer needs.

What we found, and what we did

This is how we work. We sit inside a client’s business, listen to the problem in their words, and build the fix ourselves, rather than handing over a report. Our field notes are the record of that work: each one starts with a real problem a client brought us and ends with what we changed.

Examples include ad spend the store’s own orders didn’t back up, supplier price rises hiding inside big invoices and search problems that never show as errors. Our field note The Implementation Chasm explains why we think the builder belongs next to the problem, with one person accountable for the outcome.

Worth watching

• 02:24: A clear definition of what a forward deployed engineer does.
• 06:15: How Palantir turned “services” into a way to discover what to build.
• 36:09: Why contract size, not custom work per customer, is the number to watch.