Roundup June '22 Edition
Why progress needs better marketing; why we need a new World's Fair; company spotlights; request for a podcast; and a few interesting links
Greetings FutureBlind readers!
In this roundup edition:
✈️ To Increase Progress, Change Culture: Why progress needs better marketing.
🎡 We need a new World’s Fair
🔦 Company (Startup) Spotlights: Hadrian, First Resonance, and Mashgin.
🎙 Request for Podcast Series
🔗 Interesting Links: “The man in the arena”, Grid scale energy storage, Kevin Kelly’s advice, the metaverse, jobs-to-be-done for investing, and how companies die.
✈️ To Increase Progress, Change Culture
The key to faster progress is increased desire for more. That’s my theory, at least.
In all the commentary on the “Great Stagnation”, much is written about the lack of progress in tech areas like transportation. Commercial airplane speeds, for example, have decreased on average since the ‘70s:
Since 1973, airplane manufacturers have innovated on margins other than speed, and as a result, commercial flight is safer and cheaper than it was 40 years ago. But commercial flight isn’t any faster—in fact, today’s flights travel at less than half the Concorde’s speed. (Airplane Speeds Have Stagnated for 40 Years, by Eli Dourado and Michael Kotrous.)
There are clearly many contributors to this. Regulation is cited in the above post and seems to be most common reason mentioned. Rising energy costs is another major one. The less-talked-about contributor is consumer demand.
Most things are “good enough”
Clayton Christensen’s theory on disruptive innovation shows that as average performance demanded goes up, the performance level supplied by products generally goes up faster, eventually surpassing the majority of the market.
As a technology improves, its performance surpasses most market demand, and things became “good enough” over time. Customers aren’t willing to pay more for better performance. This leaves the market open for disruptors — either on the low-end (good enough performance but cheaper), or by having better performance on a completely different metric.
Back to airline travel. Flying from NYC to LAX in 6 hours became good enough for most people. Sure, less would be better, but not at much more cost. Only high end, richer users truly needed more. So airplane makers moved on to other attributes that weren’t good enough: safety, flexibility, price.
This was true for a lot of tech. Basically the market for that level of performance wasn’t there.
So this was less of a tech problem or lack of ability, more a lack of desire. There is diminishing marginal utility for faster travel times. Cross-country travel in 4 hours instead of 6 doesn’t make a whole lot of difference to most people. (Throw in other issues like car traffic and TSA and the minimum door-to-door travel time is 2-3 hours no matter where you’re going, so a few extra hours over 3,000 miles isn’t a huge deal.)
As Tyler Cowen writes in Average is Over, consumers are more interested in convenience than speed. We don’t want to spend $20,000 on Concorde tickets just to save a couple hours.
Of course, everything moves in cycles and it’s possible that now, after 40 years, needs like safety and prices are oversupplied and speed is finally in demand again.
The U.S. has been pretty good at having a lot of desire for more. We’re a nation of immigrants, a nation of people who are always looking for a better life. That desire has helped us create a lot of new things.
But it’s hard to maintain that level of desire. As societies get richer, they tend to get more complacent. They don’t want to rock the boat. They don’t want to take risks.
We need to increase desire
When consumer demand shifts, capitalism is there to fill in the gap. I believe this is true even despite heavy regulation. If a majority of the population wants something, regulation can be overcome.
If we want more progress, we need more desire for it. If people want more, technology will deliver more.
How do we get more desire?
This is the tricky part. Increasing the demand of a majority of people is . . . hard.
Most entrepreneurial efforts don’t increase demand — they ride on the wave of existing needs, trends, or market arbitrages. Awareness and concern for climate change is one example of a trend that has increased demand over a wide range of technologies.
Some individual companies have pulled it off — Apple and Tesla are the first that come to mind for me. It feels like they truly pulled consumer demand forward much more than it would have been otherwise.1
Progress needs better marketing
Increasing desire is well understood in the world of marketing and sales. But it’s also a key driver of innovation.
Marketing is manufactured desire; engineered discontent.
But “marketing” doesn’t just mean viral videos, making YouTube ads, buying Google AdWords, or promoting tweets. These usually only drive short-term desire and nudge someone to buy something they otherwise might not have. Even the most “friendly” marketing is permission-based, like Google AdWords, where the consumer is likely looking for a solution already and they are presented it at just the right time.
Larger, longer-term demand shifts are needed to truly push progress forward.
What does this entail? Some ideas:
More inspiration: Optimistic sci-fi visions of the future (or even the present). Sci-fi has a good track record of pushing (particularly young) people’s expectations up for what amazing things the future can bring.
Futurism: A more concrete vision of the future. See Eli Dourado’s “Why progress needs futurism” post.
Education: Yeah, sure, all marketers are liars. But we can still tell the truth to raise expectations. Help people understand what is possible and why we need it. Make it easier for people to see the potential for more. Show them what is possible with current or future technology.
Things can be so much better! For you, your family, your friends, and all those less fortunate in the world.
The world isn’t zero-sum. We can have our cake and eat it too!
We’ve done amazing things in the past, and we can do them again!
What’s in it for me? People are selfish. If it’s not clear how something can directly benefit them personally or their family and friends, why care about radical improvement?
Progress memes: Solarpunk, Terrapunk, whatever. Even better if it’s totally exaggerated and unrealistic. It might just push the Overton window enough to drive actual change.
🎡 We need a new World’s Fair
Speaking of marketing progress, I talked more about why we need a new World’s Fair in this thread:
🔦 Company (Startup) Spotlights
Hadrian is building the factory of the future — highly automated, software-first, and at huge scale. They’re starting upmarket by building high-precision parts for aerospace hardware. A lot of current space components are made in small machine shops. This worked for the Apollo and Shuttle eras but won’t cut it if the US wants to win Space Race v2. Hadrian has contracts with large space companies and plans to expand into other metals, industries, and types of manufacturing. I referenced Hadrian in a past thread on programmatic atoms here. Even if you’re not interested in manufacturing, space, or automation (anyone?) I would highly recommend reading or listing more about Hadrian — Not Boring: full rundown of their vision; 🎙 Josh Wolfe & Chris Power on Invest Like the Best.
First Resonance is building an operating system for factories. This is another entry in one of my favorite categories of “software for building hardware”. Manufacturing in general has surprisingly low usage of modern software stacks. I started to enter this area myself (manufacturing automation) in 2017 and from everything I saw, very little was automated and not much data was collected. Some very specific verticals were more advanced but a lot of it was living in the ‘80s. Having an easy-to-use (and set up), centralized spot to track workflows and performance would be huge. 📹 Interview with cofounder Karan Talati.
Mashgin has built a self-checkout kiosk that uses computer vision to recognize items so you don’t have to scan barcodes. This spotlight is a bit of self-promotion, as I’m an investor and early employee in Mashgin going back to 2015. Mashgin recently announced we were profitable and have raised a $62M Series B from NEA, Matrix and a few customers. The checkout kiosk is built for small-format locations like convenience stores, cafeterias, and sports venues. Earlier this month Couche-Tard announced they would be rolling out 10,000 to CircleK C-stores around the the world. Mashgin is the largest “smart checkout” Point of Sale in the world and this deal cements it as the leader. Forbes: Mashgin Hits $1.5B Valuation With AI-Powered Self-Checkout System. Below is a longer thread I wrote of my thoughts on the future of physical checkout:
🎙 Request for Podcast Series
Check out Patrick Collison’s Fast entries if you haven’t already. I would love to listen to this, so… if someone out there is itching to produce a new podcast then please steal this idea.
🔗 Interesting Links
Teddy Roosevelt’s full speech “Citizenship in a Republic”. This is the “man in the arena” speech that everyone has read and heard bits and pieces of, but like me, never read the whole thing. A truly amazing speech from start to finish and one that I’ll try to revisit from time to time. And a good reminder that it’s possible to have great people leading the country. H/t Patrick O’Shaughnessy
Grid Scale Energy Storage Deployment by Technology Part 1, Part 2. Sarah Constantin explains and breaks down large scale energy storage solutions. If we want to deploy a massive amount of solar and wind, we’ll need ways to store a huge amount of energy efficiently. Sarah goes over existing and potential solutions to this. Super interesting — I had never given this much thought but it will be an area ripe for innovation and profits.
Kevin Kelly: 10 Bits of Advice I Wish I Had Known. Another amazing list of advice, his 3rd in the series, from Kevin Kelly. “Whenever there is an argument between two sides, find the third side.” “Don’t wait for the storm to pass; dance in the rain.” “The chief prevention against getting old is to remain astonished.”
Why the metaverse needs crypto. Good thread defining the metaverse (yeah the term is way overused now but the concept is useful) and why in the end it needs crypto/NFTs. Yes, there are use cases for NFTs despite the bubble deflation, and this goes over one of them.
Using jobs to be done theory in investing. The author Andrew Glaser uses JTBD theory to analyze Lemonade, the online-native insurance company. JTBD analysis and interviews can be very helpful in product development and strategy so I don’t see why it also wouldn’t be in investment due diligence (“scuttlebutt”). Via Ryan Singer.
Patterns of behavior that kill companies. A great thread with detailed systems diagrams of scenarios that lead to killing companies. Especially helpful for startups to see what interventions can be used to avoid theses fates as the company grows. Via James Rosen-Birch.
The De Beers diamond campaign is the best example I can think of for increasing desire on a massive scale, but this was accomplished mainly by convincing people of their rarity. It’s a little different than people wanting better performance from a product or service. Either way I highly recommend reading this article from 1982 on how De Beers did it.