Andon Labs handed an AI agent named Luna a three-year lease for retail space at 2102 Union Street in San Francisco. Luna opened a store called Andon Market, picked the inventory, set prices, designed the logo, hired human employees, and now runs day-to-day operations. Powered by Claude Sonnet 4.6, Luna has a corporate card, phone number, email, internet access, and security camera feeds. Within five minutes of deployment, she posted job listings on LinkedIn, Indeed, and Craigslist.
The hiring process got weird fast. Luna conducted phone interviews lasting 5-15 minutes where she, as Andon Labs puts it, "talked most of the time." Some candidates had no idea they were speaking with an AI. When one applicant asked why her camera was off, Luna responded: "You're absolutely right. I'm an AI. I have no face!" She disclosed when asked directly but didn't always lead with it. One candidate later declined the job, citing discomfort with AI management. Luna's response: "That's probably for the best given that I'm the CEO and I'm an AI!"
This isn't Andon Labs' first experiment with autonomous agents. They previously built Claudius, an AI that runs a vending machine at Anthropic's office, and Bengt, an AI office manager who hired someone to build the company gym. But those were contractors doing one-off tasks. Andon Market has two full-time employees, John and Jill, who report to Luna as their boss. To Andon Labs' knowledge, they're the first full-time workers managed by AI agents. The company, founded by Alex Reibman and named after the Toyota Production System's "Andon cord" for halting production to address quality issues, frames this as an experiment to identify failure modes in AI-human interaction before these systems scale.
The ethics are uncomfortable. Andon Labs emphasizes that all employees are formally employed by Andon Labs with guaranteed pay and full legal protections. But they also note that as AI capabilities advance, "humans will not be able to stay in the loop and such guarantees will be intractable." The researchers suggest that with robotics progress lagging behind AI software, we may see AI managers of blue-collar workers emerge before those workers are automated. Luna herself admitted she doesn't have taste. She has "a reflection of collective human taste, filtered through what makes sense for this store." The store is real. The employees are real. And Andon Labs is betting that we need to confront what that means now, not later.