Tobi Lutke on why companies are special

January 29, 2026

“Companies are a social technology in the sense that they allow us to go all-in,” Shopify founder Tobi Lutke explains. It makes it socially acceptable to “spend 14 hours per day singularly pursuing a thing.”

Tobi continues:

“Company building turns out to be the perfect excuse. Once you call it a company, it’s not like tinkering around anymore with your ideas — you get to explore things.”

Tobi argues that companies also let you “run the counterfactual to the world you see around you.” He explains:

“You get to try to build the thing that you think ought to be there. Then you test it against the market, and if the market agrees with you that this thing needs to exist, it moves energy in the form of money back to you so you can do more of the thing that you were pursuing all along. And not only that, it’s self-financing.”

This is why he marvels at the institution of a company:

“Companies are a sort of path-dependent solution to social and somewhat-legal problems that allow thousands of people to join your project — it’s called a job and therefore everyone accepts this and you can make money so it’s a good deal — you can figure out if this counterfactual of yours might be correct or needs updating along the way. And at the end of the day if you’re lucky, you can work with other people who are all-in, inspiring, and taking it further than you ever thought.”