Many years ago when my boys were young teenagers we used to have to take them off every Saturday to play Warhammer, the strategy game you play in person with others with characters you bought and lovingly painted yourself. It became a big obsession with both of them, rivalling even Pokemon and I got to know Games Workshop well.
I spoke to colleagues at work and unless they also had boys of a similar age they were oblivious to the whole phenomenon.
These Warhammer characters were not cheap and the rules of game were so obtuse that it was amazing so many teenage boys became so hooked (or maybe not, knowing teenage boys).
Anyway, I figured this was an interesting business model so I bought a few shares. Today the company was featured in The Economist as the best performing stock in the FTSE 250.
I may have had to wait 15 years, but I can really pick a stock – this one has risen by over 526%.
The outcome of the SEC investigation into Elon Musk’s wayward tweet on taking Tesla private could turn out to be either very good, or very bad.
The requirement by the SEC that Musk and Tesla each pay $20m in fines is trivial for both. The instruction to hire an independent chairman to oversee Musk is the crucial condition.
Tech company founders have often found themselves in need of outside experience to lead once their enterprises reach a certain size . Those who can make the product, seldom have the characteristics or experience to morph into successful managers of much larger enterprises.
The best example of this working well was Google founders Larry Page and Sergey Brin to hire Eric Schmidt to front up their rapidly growing company in 1998. It was the persistence of their VC backers which led them to find Schmidt eventually and the arrangement worked like a dream.
However, there are several reasons why a similar successful outcome may be harder for Musk to pull off, and these are two of the major ones:
Time
The SEC has given Tesla 45 days for Musk to resign the chairman’s role, not a lot of time for such a tricky and sensitive search, especially so since it is unlikely Musk has spent any time thinking about what wants or needs from such a relationship.
Temperament
Musk has a towering self-belief which seems to cover just about every walk of life – extra-terrestrial colonisation, combatting climate change, rescuing children from flooded underground tunnels. It is perhaps unlikely that he recognises the possible benefits which would accrue from a wiser corporate head, experienced in the ways of public companies.
It would be very good for the world if a Schmidt-like outcome occurred. Whether it can or not remains to be seen.
The 3D solar towers being developed by MIT illustrate just how much further we have to go in stretching the still new technology of solar power. These experimental towers are up to 20 times as efficient as today’s flat roof panels.
If the British Government needed any further evidence that the plans for Hinkley Point are misguided, this should give them pause. Guaranteeing to pay three times today’s price for electricity for the next 30 years against a backdrop of dramatic increases in efficiency of solar power (which has already reached price parity in many places at today’s prices) is lunacy.
I would be tempted to conclude that the decision is ideological, but I just can’t see how a Conservative government getting into bed with a French state utility and the Chinese Government to make their white elephant a reality gels with the Conservative free market philosophy. Perhaps it is simply that having large grey boxes hidden away on the coasts are easier on the eye than rooftop solar panels and windfarms? Who knows.
The question Alec Ross set out to answer at the RSA today was: “If the last 25 years shaped by Internet, what comes next?” His book The Industries of the Future addresses the question more fully, but for the audience today he focussed on two examples: robots and AI, and genomics.
He began, though, with central thesis: if land was the raw material of agricultural age and iron the raw material of the industrial age, then data is the raw material of the information age.
“We now live in the age of zettabyte, he said. “90% world’s data has been produced in the last two years.” There are now 16bn internet connected devices and by 2020 that number will have grown to 40bn. “Harvesting of actionable business or medial intelligence from this data will create the trillion dollar industries of the future.”
But now for the two example industries of the future.
” The cartoons of the 70s will be the reality of 2020s,” he argues. One of the key advances is the fact that we finally seem to have cracked the problem of robots grasping – a surprisingly difficult task, he says. The other is the advent of “cloud robotics”. This means robots don’t have to be packed with hardware and software if they are connected to the cloud. “We don’t have to invent millions of very clever robots.”
He uses the example of Foxconn, the Chinese giant responsible for vast numbers of iPhones and Samsung Galaxies. Foxconn is a poster child for globalisation with 973,000 employees in China. But the ceo says he’s not going to hire any more people and instead is now buying $14k robots. He argues humans are “CAPEX-light, but OPEX-heavy” whereas robots are the opposite.
This is the start of a profound trend. “Cloud robotics coupled with rise of AI will mean a move to non-routine and cognitive work.”
The second industry of the future he focussed on is the commercialisation of genomics. “It has been 15 years since the first mapping of human genome and finally we are now within two or three years” of really beginning to reap the benefits he says. Diagnostic test are now in development with are over 100 times more sensitive than MRI scanning, holding out the prospect that we could have an annual blood test which could detect virtually all cancers at stage 1, when they are eminently curable, he predicts.
However, all these advances come with “promise and peril”.
“Tomorrow will be better than today for most of us. But you have to be pretty clever to navigate your way through with the pace of change increasing all the time.”
There were other topics which came up in the Q&A on which he had salient views:
Cyber security: “Weaponisation of code is the most signification development since the weaponisation of atoms. The difference is weaponisation of code is much easier. Once it is done it can be copied. I have a very dark view – the threat from cyber weapons is closer than that of nuclear weapons.”
The importance of gender equality: “There is a correlation between women on board and economic performance,” he said, citing a study from the Peterson Centre for International Economics.
Economics: “This the the key question,” he said. The problem dynamic is “bounty and spread”. When Instagram was sold to Facebook for $1bn it had only 20 employees. Kodak, which went bust at pretty much the same time, had 120,000 employees. When we create these internet billionaires we have a “corresponding obligation to use the resources of the plutocrats to avoid creating a violent under-privileged underclass”.
R&D: “Those states and societies (like Russia) which have dialed R&D down are saving money in the short term but killing themselves in the long run.” China, he says, is being smart. “They believe they missed out on the commercialisation of the Internet and they are putting a spectacular amount of investment in genomics and clean tech” so they don’t miss out of these coming revolutions.
The world is headed for a big transition, says David Orban, entrepreneur and Singularity University faculty member, speaking at a London Futurists lecture in London on February 6th.
“Technology created humans,” he says. “And we continue to use reason to advance technology for humanity’s benefit.” But the key to the future wellbeing of society lies in practicing open science and having an open society, he says.
David Orban
Historically we are always “shackled to moral norms by limitations of technology” he says. For example we had child labour because our technology wasn’t good enough to run industrial revolution mills without them. We had slavery because our agricultural and engineering techniques were running behind our economic development.
Now we destroy the environment because it is deemed necessary in order for economies to grow and citizens to consume. Once these ills become untenable, necessity drives alternatives, he says.
Widespread social and cultural change only happens once a robust technology platform underpins them
The networked exponential technologies which are coming next are going to profoundly disrupt the Nation State, he argues.
Solar panels are a good example. When people put solar panels on their roofs they make lots of small decisions, each of which doesn’t cost much. When the State makes energy decision for the country it is done by one big, long term centralised project (think Hinkley Point). The opportunity to call the future wrong is vastly more in the second case than the former.
Another example is 3D printing. This can stop waste from centralised manufacturing getting it wrong but distributes power to the consumer.
And growing food hydroponically in the basement of apartment blocks, reduces waste by bringing food production close to the consumer, using exact quantities of nutrients and light and heat, and growing year-round.
And there are lots more examples, he says:
Health sensors keeping people healthy
MOOCs educating people wherever they are
Crypto currencies reducing the cost of transactions and challenging the power of the banks
Even Airbnb competing with security agencies through “a self-reinforcing reputation system which expels from the network if breached”
All such examples are inevitably portrayed as passing fads, he says, but they are in fact part of unstoppable trend.
In this environment exponential technologies lead to exponential uncertainties, he says. There is great value for those whose get it right.
The next trillion dollar companies are being born right now
What has to happen next, he argues, is for computers to be allowed to make decisions by themselves. The world is rapidly become too complex and fast-moving for humans to be the only decision-makers. The LHC, for example, throws away 99% of data itself because it knows it is of no value and the human scientists would become overwhelmed. “Self-driving cars need to make their own decisions.”
Dumb machines must lose and smart machines must win
But for computers to make decision we need to make them moral. We have a “cosmic responsibility to adapt and face our challenges” he says. We need a global network of ideas which can evolve scaleable solutions. First there will be a science of morality then we will need to engineer morality into our machines. It is, he says, inevitable.
The promise of the fully networked society is great, but the outcome isn’t a given. “It is up to us whether this phase transition will be peaceful or not”, he says. The current levels of inequality will be just the start unless we meet the challenge to change society so that everyone can enjoy the coming benefits. “We cannot continue vilify the unemployed as we do now,” he says, because in the future we all will be unemployed.
The Smart Keyboard for my iPad Pro arrived today and I’ve done a quick bit of testing. As for the typing capabilities – not bad at all. The keyboard is pretty responsive to the fingers and well-spaced so even though it was unfamiliar to me, quite a fast speed can be reached and I guess I should get faster the more I use it.
Another plus, folded the keyboard isn’t as bulky on the front of the iPad as I had feared.
Does it turn the iPad into a laptop replacement?
I don’t think so just yet, but it will increase the utility to the point that the device can be used solo in more situations and for longer. iCloud could be the key, as storing documents remotely means a fairly high number of day-to-day uses could increasingly be covered by the Pro providing productivity software like Pages and Numbers continues to grow in sophistication.
Whether this combo amounts to value-for-money, though, is quite another question.
I spotted ReWork on my bookshelf yesterday and it reminded me how much I had enjoyed reading this thought-provoking account of 37 Signals’ business philosophy. That inspired me to see if I could find Jason Fried, the founder, talking about his approach and I found it here.
Here are some of the main points:
Don’t lose control of your growth. The key decision the company took was to limit the maximum price on customer could pay (initially $99 a month). This means the company has hundreds of thousands of customers, but none of them are so big that losing them would cause a ripple. Key to this is not to customise – one product, one code base.
Hire late not early. Many companies hire ahead of when they think they will need resources, especially if they have received funds from investors. This is a big mistake, Fried argues. Hiring early means there’s often not real work yet for the newcomer to do. That leads the company to make up work which is not important – a cardinal sin, in Fried’s philosophy. A related point: never hire for new type of position before you’ve had someone in the company try it first and fail. That way you know exactly what you need to get done and can hire appropriately.
Develop an audience. This is different from developing a fan base. An audience comes back to you time and time again. It takes time to build up, but once there is the most powerful way to get products out. Spend money on teaching and sharing, not marketing. 37 Signals has no salespeople: “We only want to have people who are building the product.”
Focus on the things which will stay the same. Most companies spend most time focussed on new things, innovations. But this piece of advice, from Jeff Bezos, the only investor in 37 Signals, was key. In Amazon’s case the things which will always stay the same are low price, good selection and great logistics. No matter what else changes, these fundamentals will hold true. In 37 Signals’ case the core unchanging things are simplicity, clarity and speed.
Apple is known for expensive technology. But for the extra money we have always received higher quality, better usability, superlative design. But with the announcement of a $10,000 solid gold watch today, I wonder if they have made a tactical mistake.
There is no way to argue that the watch itself (functionality, form, impact) is worth that amount of money. After all you can get exactly the same for under $400 – albeit in aluminium.
And, while buying an expensive mechanical watch is an investment is something with staying power – watches can be handed down across the generations – Apple’s version is going to be obsolete in a couple of years. It probably won’t even tell the time five or six years down the line when the software is updated.
Apple is the uncompromising, innovative guardians of good, user-let design is the model we have been used to. Apple as the flashy luxury brand pandering to the super-rich may not play quite as well.
I’ve just been to an inspiring presentation at the RSA given by former management consultant Frederic Laloux who was talking about his book called Reinventing Organizations.
He argues that many people intuitively believe that current management practices just aren’t working and that they are right and a big shift in how organisations work is about to happen.
He outlined three principles:
Self organisation
Wholeness, and
Evolutionary purpose
I have a lot of sympathy with the first two: I think it is quite clear that the less overhead you can put onto people who know what they are doing the better and I instinctively feel that fewer management layers is ideal; I also think all organisations would be much better with less ego and more emotional and social intelligence.
The third principle, though, I confess I’m having trouble with. The idea, as I understand it, is that instead of central strategy, planning and budgetary frameworks the organisation is left to respond to challenges and adapt as it goes along (almost like a susurration of starlings).
The presumption is that the people within the organisation understand where they are collectively going and what they are trying to achieve and are best placed to ensure the organisation gets there. I can’t help feeling this assumption may not always be true.
I’m looking forward to reading the book to see what more Mr Laloux has to say on the subject.
RSA Chief Executive Matthew Taylor (left) with Frederic Laloux
His book 
