Inside Vercel: The $3B giant that’s changed coding forever
In this episode of The Eric Ries Show, I’m joined by Guillermo Rauch, CEO and founder of Vercel—a company powering the front end of the internet for brands like OpenAI, Nintendo, Chick-fil-A, and many more. Guillermo’s journey began far from Silicon Valley, in Argentina, where a Red Hat Linux CD changed the course of his life.
We talk about how open source gave him a way in—and why he still believes it’s the ultimate growth engine for companies and careers. Guillermo shares what he learned from building developer tools used by millions, and how Vercel became the go-to platform for the AI era.
In our conversation today, we talk about the following topics:
• How open source paved the way for Guillermo’s career
• The case for open source as a growth strategy
• What makes Silicon Valley special, and how online communities can unlock similar opportunities
• The gap between how elite companies ship software and how most others do
• How Vercel became the go-to for AI startups
• The future of the web: agents, AI clouds, and software 2.0
• Guillermo’s take on vibe coding and why it’s more than just prompts to code
• How recursive founder mode helps Vercel stay fast while scaling
• The challenge of keeping Vercel open, fair, and resistant to abuse
• And much more!
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Where to find Guillermo Rauch:
• X: https://x.com/rauchg
• LinkedIn: https://www.linkedin.com/in/rauchg/
• Website: https://rauchg.com/
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Where to find Eric:
• Newsletter:https://ericries.carrd.co/
• Podcast:https://ericriesshow.com/
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In This Episode We Cover:
(00:00) Intro
(01:31) Guillermo’s early encounter with open source and how it shaped his path into tech
(08:44) Guillermo’s early contributions to the open source community
(11:03) Why Guillermo ditched Linux for Mac OS
(12:28) Guillermo’s contributions to MooTools
(13:40) How Guillermo landed his first real job before even graduating high school
(15:07) Guillermo’s early startups and the origins of his entrepreneurial drive
(18:40) How moving to Silicon Valley ignited his ambition to found a company
(23:45) The story of Vercel—and how it started with an open source project, Next.js
(31:40) Open source’s impact on talent creation
(33:46) Why building the harder thing up front makes everything easier downstream
(36:30) What Google got right with Chrome—and how open sourcing it changed the game
(39:55) What companies like OpenAI, Nintendo, and Chick-fil-A use Vercel for
(43:57) Why so many AI startups are building on Vercel
(51:52) What recursive founder mode is
(58:17) How Guillermo finds value-aligned founders
(1:02:03) Why nearly everyone at Vercel uses AI, without being told to
(1:04:50) Using Bezos’s Day 1 mindset to fight bureaucracy and move fast
(1:09:56) Vercel’s approach to vibe coding and AI safety
(1:11:32) Guillermo’s thoughts on immigration
(1:15:37) Why Vercel fights to keep its platform open, fair, and safe for everyone
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Referenced:
- Hello, World!: https://en.wikipedia.org/wiki/%22Hello,_World!%22_program
- Linux: http://linux.org/
- Red Hat: https://www.redhat.com/
- Tux: https://en.wikipedia.org/wiki/Tux_(mascot)
- Darwin: https://en.wikipedia.org/wiki/Darwin_(operating_system)
- MooTools: https://mootools.net/
- Vercel: https://vercel.com/
- Socket.IO: https://socket.io/
- Notion: https://www.notion.com/
- Perplexity: https://www.perplexity.ai/
- Mongoose: https://mongoosejs.com/
- Node.js: https://nodejs.org/en
- Justin.tv: https://en.wikipedia.org/wiki/Justin.tv
- Odeo: https://en.wikipedia.org/wiki/Odeo
- Regional Advantage: Culture and Competition in Silicon Valley and Route 128: https://www.amazon.com/Regional-Advantage-Culture-Competition-Silicon/dp/0674753402
- Wordpress: https://wordpress.com/
- React: https://react.dev/
- How GitLab scaled to 30M users with transparency, remote work, and the ultimate employee handbook | Sid Sijbrandij: https://www.ericriesshow.com/Sid-Sijbrandij/
- Dia: https://www.diabrowser.com/
- Brave: https://brave.com/
- Perplexity Comet: https://www.perplexity.ai/comet
- Create React App: https://create-react-app.dev/
- OpenAI: https://openai.com/
- Nintendo: https://www.nintendo.com/
- Porsche: https://www.porsche.com
- Chick-fil-A: https://www.chick-fil-a.com/
- Under Armour: https://www.underarmour.com
- Weather.com: https://weather.com/
- MCP: https://www.anthropic.com/news/model-context-protocol
- Google Ventures: https://www.gv.com/
- Founder mode: https://www.paulgraham.com/foundermode.html
- Bill Gates tries to install Movie Maker: https://www.techemails.com/p/bill-gates-tries-to-install-movie-maker
- Soleio on X: https://x.com/soleio
- 2016 Letter to Shareholders: https://www.aboutamazon.com/news/company-news/2016-letter-to-shareholders
- MidJourney: https://www.midjourney.com/
- Black Forest Labs: https://bfl.ai/
- Runway: https://runwayml.com/
- Adobe: https://www.adobe.com/
- Neuralink: https://neuralink.com/
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Production and marketing by Pen Name.
Eric may be an investor in the companies discussed.
