Garry Tan Says Founders Must Build With Customers To Compete With Giants Like Salesforce, Oracle: 'You Can't Farm This Out'

Y Combinator CEO Garry Tan believes startup founders can learn critical lessons from Palantir Technologies Inc. PLTR forward-deployed engineers (FDEs) to compete against enterprise software giants.

What Happened: Speaking on the Lightcone Podcast, Tan outlined how the FDE model developed at Palantir, where he served as an employee and co-created the company logo from 2005 to 2007. “You can’t farm this out,” Tan said, emphasizing that founders must directly engage with customers like FDEs do.

The FDE concept emerged from Palantir’s recognition that Fortune 500 companies and government agencies lacked technical expertise at decision-making levels. Co-founders Peter Thiel, Alex Karp, and Stefan Cohen identified multi-billion-dollar problems in organizations drowning in data without understanding how to extract value.

Tan explained how FDEs sit directly with clients, like FBI agents investigating domestic terrorism, observing their actual workflows. “What’s funny is like literally it’s like Word documents and Excel spreadsheets,” Tan said, describing how FDEs convert manual processes into clean software solutions.

Traditional enterprise software companies send salespeople who rely on relationships and lengthy sales cycles lasting months or years. Palantir’s approach places engineers directly with customers using Foundry, their core data visualization platform. “Instead of the next meeting being reviewing 50 pages of sales documentation, it’s literally like ‘Okay we built it,'” Tan said.

Why It Matters: This methodology enables rapid feedback cycles within days rather than months, allowing smaller companies to compete against established players like Salesforce Inc. CRM and Oracle Corp. ORCL. Y Combinator partner Jared Friedman noted that Palantir FDEs have become successful YC founders, crediting their training.

Palantir recently raised 2025 revenue guidance to $3.89-3.90 billion while projecting adjusted free cash flow between $1.6-1.8 billion. The company’s market cap currently stands at $310 billion, with analysts projecting potential trillion-dollar valuations within three years.

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Tan emphasized that beating enterprise giants requires engineers who combine technical skills with empathy and product design capabilities. “You show them something that they’ve never seen before and make them feel super heard,” he said.

PLTR stock has surged over 500% in the past year. According to Benzinga Edge Stock Rankings, the stock demonstrates strong growth and momentum but carries a weak valuation rating. View the full stock breakdown here.