When Mary Meeker’s 2014 Internet Trends report was released, a friend wondered aloud what life was going to be like in ten years. While Meeker’s deck is a nice starting point, it is merely the tip of the iceberg. I thought it would be a good exercise to illustrate the mental models I use to keep both abreast and ahead of tech trends.

Ben Horowitz revealed this brilliant interview question on Charlie Rose: “What do you believe that nobody else believes?” It is a great way to ferret out independent thinkers.

It is also a wonderful counteragent to recency bias. Industry idols, extolled by the multitude, bring forth throngs of novices enheartened by the glisten of victors’ accolades. But the matches have already concluded and the outcome of the contest determined. You’ll end up investing in what is, almost by definition, consensus and, at best, a better mousetrap. Although that cuts off tail risk tremendously, it also cuts off the probability that what you are investing in or building will be earth-shattering.

Granted, the popularity of futurism ebbs and flows with the oscillations of technology bubbles. But you need a vision that will compel followers to sojurn down the Road to Calvary, as opposed to the comfortable paths found in the campuses of the publicly traded. You want to be able to create a Jobs-like reality-distortion field and be able to ask, “Do you want to sell sugared water for the rest of your life? Or do you want to come with me and change the world?” As the old cliché goes, “It’s crazy. But it might just be crazy enough to work!”

What does the future look like? A computer on every desk. A transistor in every pocket. Those concepts seem foreordained in retrospect. But even in the case of seemingly Olympian inventors, will is not fate. When something is distant enough to be evanescent in its abstractness, you need a vision that creates a concrete palpablility you can use bring the imagined into reality. And even if you are wrong about the future, you just have to be less wrong than your rivals.

The many visions of many futures
  1. Journey to the Antipodes to Find Secrets
  2. The Creatives
  3. The Leviathans
  4. The Mutationists
Journey to the Antipodes to Find Secrets

The best mental models (great Mungerism) of thinking about the future I have found come overwhelmingly from investors that spent a lot of time in industry, like Marc Andreessen or Peter Thiel. Peter Thiel put it in terms of finding secrets.

Essentially, if you see Kara and Walt covering the space, you’re most likely looking at post-chasm ventures, and that venture is well on its way to be publicly traded (if it isn’t already). So if not at the Re/Code Conference, where are some good places to find secrets? Two places that are, in many ways, the cultural antipodes to finance land, and even start-up land to a certain extent: the military. And academia.

At MIT, the Media Lab has created numerous technologies that have made products from the Kindle to Guitar Hero possible. MIT also had—what was legendary in scientific circles—Building 20.

UC Boulder actually has a Research and Engineering Center for Unmanned Vehicles. And while there are regulatory issues in the United States—both tech transfer and FAA—a swarm of companies around the world are entering the space. More competition means more innovation, and with problems as complex as UAVs, multi-industry applicable technologies are likely to arise from these.

While we’re on drones, I would be remiss not to mention DARPA, which creates a ton of cool tech and can afford to take a really long view given its DoD mandate. It was actually ten years ago that DARPA held its first competition for autonomous vehicles. It did not go well, suffice it to say. If I recall correctly, Carnegie Mellon’s vehicle went the furthest but got stuck in the middle of the desert. Ten years later, we have self-driving cars with no pedals or steering wheels coming out of a certain campus in Mountain View.

The Creatives

Speaking of which, I saw Larry Page +1 an article about how inventors should read more Sci-Fi. Jaron Lanier is on Microsoft Research staff and Cory Doctorow is on Google’s staff. Bruce Sterling hasn’t written Sci-Fi lately, but now consults for tons of tech companies.

One of the best ways to create a future is to make Steven Spielberg work on a Sci-Fi movie for you. That is a bit in jest, but in order to create an immersive world for The Minority Report, Spielberg held an idea summit. The plot of the movie is, in my opinion, rather forgettable. But the world-building was brilliant. Many technologies, including self-driving cars, large screen gesture control, and user tracking, are well on the way to market today. Not to mention that the technology used to understand gesture control has been adapted for use in autonomous robots.

Although I was a latecomer to the Sci-Fi genre, I see similarities between the film cartridges in David Foster Wallace’s Infinite Jest and what has essentially become the scramble for eyeballs that was the basis of Web 2.0. And Neuromancer, though dystopian, has great business ideas on many of its pages—not to mention the significant role of the zaibatsu in that novel, which bears similarities to the current battle between The Brobdingnagian Four.

The Leviathans

Speaking of zaibatsu, there’s a really rather curious phenomenon in that large companies often have the resources to create a new product cycle. But they aren’t the ones who end up capturing the product cycle. It’s usually some upstart (or comeback kid) who ends up executing.

If you read Who Says Elephants Can’t Dance? Lou Gerstner basically described the cloud, but it’s Amazon who dominates the space now. When Bill Gates wrote The Road Ahead in 1995, the book came with a CD that had videos of various future technologies—that other companies executed on: electronic wallets, tablets, smart TVs. If you read the Steve Jobs bio by Walter Isaacson, Sony had all the elements to create the mp3 player. They had the Walkman. They made hardware in the form of consoles. They even had a giant library of music because of their record label! But it was the iPod that won.

There’s a ton of factors that cause this phenomenon. Like bureaucracy/entrenched interests. The culture of asking for forgiveness in a small company becomes a culture of asking for permission in a large company. Unwillingness to cannibalize the product that made your company great. Or maybe it’s too far ahead of its time. Or stock option risk-reward profiles in a large company attract more risk-averse employees. But the main point is, if there is a giant company in a space, it shouldn’t necessarily deter small companies (great dramatization of the battle against Big Blue by the way is “Halt and Catch Fire”).

You have to invert your mental model when it comes to innovation. Economies of scale become diseconomies of scale. Competitive moats become competitive quicksand.

The Mutationists

I’d recommend three great books (1) Uncommon Genius by Denise Shekerjian; (2) Origins of Genius by Dean Keith Simonton; and (3) The Ten Faces of Innovation by IDEO. The basic takeaway I’ve taken from reading them is that the creative process and innovation are, fundamentally, about taking a bunch of seemingly unrelated ideas, putting them together, and seeing what happens. It’s like splitting genes, rearranging the nucleic acids, and getting something completely different. And though you will get many unfit genes along the way, it’s the only way to evolve.

This was one of the fundamental values that drove Apple: a technology that had traditionally been geeky should really be a liberal art (and keep in mind that during his exile from Apple, Steve Jobs was working with artists from Pixar).

When we see “4”, we see a number. Picasso saw a nose. So at school, he’d doodle the rest of the face on the blackboard. Suffice it to say, the traditional educational system is not conducive to this kind of independent thinking…

Back to the Deck

Anyway, back to the KPCB deck, regarding the section regarding foreign companies on page 127: China used cyber-espionage as a pretense to reëvaluate the usage of IBM servers? China has been discriminating against Windows 8 as well. This actually isn’t too distinct from the “protection of infant industries” policy we pursued during our Hamiltonian era, though here a bit of rising global power tension also has to do with it.

Protectionism can give indigenous enterprises leads that are hard to surpass, even by the multinationals. If you look at the OECD and G-77 ex-China, the overwhelming leading sites are Google and Facebook (by the way, Japan, the odd one out, loves Yahoo!). In contrast, the leading site in China is Baidu, not Facebook. Even if maintaining societal harmony, as opposed to Hamiltonian protectionism, was the primary objective behind restricting Google and Facebook, the Great Firewall of China nevertheless creates the same effect.

I suspect China is now in Meeker’s deck because of the Alibaba IPO—one of the biggest deals this year. But strong state control of the Internet basically ensured that the winner would be a domestic homegrown company.