Inside Shopify’s company-wide Gen AI push under Tobias Lütke

For our content series “Beyond the hype: AI in Financial Services” I covered how traditional banks and credit unions are deploying Gen AI in their operations. A clear pattern emerged in those case studies: Some Gen AI projects are already in use but their approach remains constrained to the back office. 

Today’s micro case study sheds light on just how different fintech approaches to the tech have been. Where FIs have made “slow and careful” their mantra, fintech leaders like Shopify’s Tobias Lütke are boldly changing everything from hiring to customer facing interfaces with Gen AI. 

Shopify’s Gen AI strategy wraps around employees and customers

Lütke has made two major moves to integrate Gen AI into the company: First, he is changing how work is done inside the company and second, how Shopify’s customers get their own work done through its products. 

The back story

Earlier this year, Lütke’s intentions for Gen AI became public when a manifesto of his leaked into the press. The document gave insight into the cultural shift Lütke is planning for Shopify, one which would mandate use of Gen AI for all employees, and will strong-arm the use of the technology in future hiring for the company. 

In a post on X (formerly Twitter), Lütke acknowledged the leak and posted the manifesto in full. In the document the CEO shares how he has been using the technology himself to create his industry talks and how he had previously urged his employees to “tinker” with the technology. But  Lütke’s call to action on Gen AI proved to be “too much of a suggestion” in his opinion. With the manifesto, the CEO decided to take the choice of using Gen AI away and made its usage a “baseline” for Shopify employees in his manifesto. 

The masterplan

Lütke’s manifesto focuses on six major points: 

1. Mandatory Gen AI usage: All employees are expected to augment their processes and work with Gen AI across Shopify. While Lütke says it’s possible to opt out, he strongly believes doing so is a mark of stagnation. 
2. Gen AI-led exploration and prototyping: The manifesto also directs employees to use Gen AI for exploration and prototyping tasks when it comes the firm’s Global Software Development projects. 
3. Gen AI determines your future as an employee: Lütke positions learning to use Gen AI as an “unobvious” skill, noting that the company will be adding “AI usage questions to our performance and peer review questionnaires”. 
4. Learn Gen AI on your own: Learning Gen AI at Shopify will be “self-directed” but employees are invited to use the company’s communication channels like Slack to share what did and did not work for them. 
5. You don’t need more resources, you need Gen AI: Before being granted more resources, Shopify employees must demonstrate why a specific task cannot be done by Gen AI agents. Lütke adds that this exercise can lead to “really fun and interesting projects.”
6. Egalitarian, for once: Lütke’s mandates in the manifesto apply to everyone, including the C-suite. 

Shopify’s Gen AI push goes further than impacting internal processes, though, and seeks to augment merchant and shopper experiences with the technology. Recently, the firm launched a new “AI Store Builder” which would build three complete layouts of storefronts for merchants based on their text and image input. 

“Instead of just having a merchant click and drag and fill out text fields on how they want their site to look—which can be really daunting for some—we thought why not ask them more open-ended questions and set up their store in the best likeness we can imagine, using AI,” said Vanessa Lee, vice president of product at Shopify.

Moreover, a new global product directory is in early access for developers, enabling shopping chatbots to furnish merchants’ products in chat based environments. In a similar vein, the firm also acquired Vantage Discovery, which uses LLMs to improve retailers’ search functions, allowing customers to see more personalized search results. 

Tearsheet take

Shopify’s customer-facing applications of Gen AI aren’t ground breaking but they are far ahead of what we have seen done by traditional financial institutions. For now, these functionalities focus on improving singular merchant processes or interpose functionality that was already improved by Gen AI since its inception, like search into the shopping environment. 

It’s the aggressive Gen AI-forward internal policy that breaks Shopify from the norm. 

In an environment where regulators have yet to figure out just how principles of fairness and equality would apply to these new regimes of work called the “human in the loop”, Lütke’s insistence on mandatory usage within the firm that makes me wonder how the company is handling mistakes made by the employee-Gen AI team. 

And although Lütke claims that his Gen AI directives will apply to everyone across the organization, it begs the question: who will Lütke and C-suite members grant more resources to and will these C-suite members feel as much friction from this justification process as middle management employees do? 

Lastly, while Lütke seems to be pushing ahead of other fintech CEOs in his Gen AI-forward policies, is Shopify ready to disclose how its undertaking change management at the organization and what the firm plans to do to help employees use Gen AI better beyond self-directed learning?

It’s not surprising that a fintech leader is willing to boldly go where no one else has before. In fact, it’s this attitude that allowed fintechs to reshape the financial industry in the first place. What would be new is the willingness to build safeguards and industry standards and the wisdom to spark conversations about how this new paradigm of work changes company values and impacts employees, so that the Gen AI tide can lift all boats – safely.