Author: Jeremie Averous

Why Creating a Startup is About Building a Different Future

“Positively defined, a startup is the largest group of people you can convince of a plan to build a different future”  writes Peter Thiel in ‘Zero to One: Notes on Start Ups, or How to Build the Future‘.

early-google-employees
Early Google Employees

This vision of a different future may be more or less ambitious, and intend to touch more or less people in the world. It might be within a small specialized niche or intend to take the world by storm. However, any real startup will be built on the premise of bringing a change to the world.

Actually this criterion might be an excellent differentiator between real startups and new companies that only intend to milk a situation.

Peter Thiel continues along the same trend of thought: “A new company’s most important strength is new thinking: even more important than nimbleness, small size affords space to think”

In my experience, the quick iterations around product, marketing, and business model do mobilize a significant dose of mental power and unending discussions. And indeed, the need to create value in a commercial startup (get revenue before funding is exhausted) is a great incentive to create something that will change the world somehow.

If you want to build a different future in a context where you’ll really mobilize your thinking, creating a startup is the way to go.

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Why the Historical Trend of Interest Rates Should Be to Get Lower

Interest Rates represent our preference between a dollar today and a dollar in some time in the future. In effect, they represent our preference between now and later.

Real interest rates getting lower over long times: an illusion or a reality?
Real interest rates getting lower over long times: an illusion or a reality?

Because of the increased life expectancy and hence, capability to make plans for the future, the availability of future money should be less discounted than when we had short life expectancy and had to enjoy more the moment! We should thus observe that over time, the interest rates should decrease.

Of course, it is difficult to observe this trend with the high variability of the interest rates (real interest rates, i.e. interest rates minus inflation, should be considered here). Lately since the 1960’s it has decreased; and it is quite lower than the 5% per year without inflation that was enjoyed in the 19th century. It can be expected to rise again in the next few years, but probably not to very high levels.

I believe that it is possible that in the Collaborative Age we live with generally lower interest rates than the historical averages. Value will be created otherwise through creativity, but because we can plan for decades ahead on average, there will be a less steep discount of the future.

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Why You Always Need to Look for the Real Underlying Problem

It is now well known in consulting that the issue which you are called in to solve is rarely the real issue at stake. Most of the time, there is some underlying problem which is much more serious and that needs to be addressed heads on.

Do you see the problem? If you don't see the lion look at the problem from further!
Do you see the problem? If you don’t see the lion look at the problem from further!

This issue is explained for example in Peter Block’s ‘Flawless consulting‘ book.

And quite often as consultants, as we are not infallible, we start addressing some surface problem first before realizing what the main issue really is.

Also, the real issue is often more difficult to tackle because it is generally a much deeper issue related to governance and people’s behavior.

When called in to resolve an issue, always take a deep breath and some time to figure out whether there would not be a deeper underlying problem that would better need to be resolved. It is generally the case, and your intervention will be much more powerful.

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How the Rise of Ad-Blocking Software Questions Internet’s Business Model

Most of large internet companies are funded by advertising, such as Google and Facebook. In exchange for the provision of some free services (of high value to us, but highly scalable), they use the data collected to target advertisement, with the expectation to increase the advertisement click-through rate hence their revenues.

adblock-plusAdblock software is a response to this, as it blocks ads from showing up on pages. It definitely improves performance. The most successful of these software originated in Germany, which has a fierce data protection approach shaped by a reaction to the years of internal state-spying in East Germany.

While these software remained marginal they were a limited threat. But it tends to grow exponentially, reaching 40% of the users in Germany! (see ‘Ad Blocks’ Doomsday Scenarios‘ by Frederic Filloux) Now it appears that Apple has included one of such software natively in their latest browser (see ‘What the Adblocker debate reveals‘) and that might change significantly the industry. Of course it is a nice strategic coup from Apple to weaken Google, as Apple does not depend on advertisement as a primary source of income. But it nevertheless poses a great threat to much of the internet industry, as the advertising community does not seem to have done anything against it yet.

The balance between intimacy, the usefulness of targeted ads and the economy of internet is still not settled. The next few months will be quite interesting to monitor as it might be that a few cards will get redistributed in the industry!

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How the Value of Social Networks Could Correlate to their Emotional Impact

I have a theory which is that the value of social networks could be directly connected to their emotional impact.

Following our post on ‘Why Facebook’s Power is About Fostering Emotions‘ we could maybe go one step further and look about the emotional impact of other social networks. Here’s my view on a few I am using regularly:

  • Social MediaTwitter does not create so much emotional impact except on those of us that are attracted by instant news and updates, so I do not believe in its ultimate success unless it enriches content with the objective of improving significantly its emotional impact (which it has started doing adding pictures and videos, but it remains limited and focused on news and events, so I am not convinced they’ll pull it through)
  • the weakness of Google+ in my view is also the sleekness of the interface and the lack of a similar emotional impact like in Facebook, except for those that crave for great high-quality artistic pictures
  • YouTube’s success could be attributable to the fact that video as a medium is much more emotionally inductive than pictures or text due to its rich content

Maybe you could think about other social networks and share how it fares in terms of emotional impact, and share whether it is correlated with its value. Please share in the comments!

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Why Facebook’s Power is About Fostering Emotions

The power – and the value – of Facebook is about fostering emotions. Why should we then be surprised when Facebook conducts research about emotional reaction to posts?

emotions and social networksThere has been a lot of uproar last year when a report detailed some research done by Facebook about how certain types of posts create different emotions (see for example this Guardian article ‘Facebook reveals news feed experiment to control emotions’ and this Atlantic column ‘Everything We Know About Facebook’s Secret Mood Manipulation Experiment’).

The interest of Facebook, of course, is to make sure that it creates the most positive emotions in its users, as well as curiosity, so that users stay and come back (under the assumption that we are always weak when it makes us feel good). It can even sometimes border on addiction – another emotionally-related reaction.

The value of Facebook in our lives is about the experience, i.e. our emotional response to the stimuli presented to us. It is what makes the attractiveness and ultimately the market value of Facebook. Why are we so surprised that Facebook tried to improve that experience to hook us up?

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How a Reality Distortion Field is Essential for Visionary Leaders

I was struck how Steve Job’s “reality distortion field” was repeatedly highlighted in the Walter Isaacson biography. In several instances this drove actions that were at odds with acknowledged possibilities. It was definitely a major source of creativity. This capability also influenced significantly people around him.

Steve_JobsThis particular capability was quoted as a strength that allowed leaps of faith and moving teams to achieve impossible feats. It was also identified as a weakness as Steve Jobs was unable to process information that was contradictory to his intent or position (sometimes indeed, reality did not bend to his will!).

I have personally observed that visionary leaders do generally possess this reality distortion field capability (and the related influencing capabilities). It is often the only way to move the team. And it is often a visible distinction between the “bureaucrat” leader that remains withing the current reality and the “visionary” leader that can jump in new reality fields.

And it is sometimes difficult to withstand the attraction of the reality distortion field when one is around a strong one.

Measuring the strength of the reality distortion field of those people around you is indeed a good way to measure whether people are visionary.

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How We Have Increased Dramatically our Feedback to all Services We Use

Following up on our post ‘How Social Ratings Determine Our Choices‘, let’s add how much more often we are asked to rate, and we do rate services.

Ratings have also been introduced for toilet service at Singapore airport!
Ratings have also been introduced for toilet service at Singapore airport!

I am amazed at how often I am prompted to give my feedback now. In all situations: when using a website or a service on internet; when visiting a hotel on the reservation platform; when downloading or using an app; when reading a book on my Kindle; and even when visiting the toilet at the airport!

And when we don’t do it consciously, the machine does infer some ratings: for example, how much and quick I read my book on Kindle certainly creates some rating in Amazon.

When we put this situation together with the fact that this forces the system to behave like a complex systems, reinforcing the popularity of the popular services and diminishing greatly the popularity to the others, we can see how our world is increasingly transforming in all spaces to a “winner takes all” situation, or that everything will be increasingly governed by the famous long tail distribution.

Welcome to the Collaborative Age!

By the way: how do you rate this post? 🙂

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Why You Should Use Powerful Questions More Often

Questions have great power. They can create real shifts in our thinking. It is a tool I use a lot in coaching. Action Learning is a cousin, where problems are being managed by diverse teams of people using questions.

power_questions“Requiring people to think in terms of “questions first” transforms the dynamics of the group. The natural impulse to make statements and judgments gives way to listening and reflecting” writes Michael Marquardt in the book ‘Optimizing the Power of Action Learning’.

In business meetings I observe that people too often proceed with making statements. It would be much more effective to ask questions. The best leaders actually do that, and it is quite easy to identify leadership with the ability to ask questions rather than making statements.

Next time, when you’re about to make a statement, ask yourself whether it would not be better to ask a powerful question instead. It will change the dynamics of the group!

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Why Integrating New Experiences in Our Life is an Essential Skill

“The ability to process new experiences, to find their meaning and to integrate them into one’s life, is the signature skill of leaders and, indeed, of anyone who finds ways to live fully and well.” —William Bennis

transformationI find this quote very much to the point. What is implied requires two skills:

  • the ability to venture beyond one’s comfort zone and be open to new experiences,
  • and the ability to process this new experience and change oneself

Both can be challenging to people. For example, I do easily venture outside my comfort, but I am not completely sure I take advantage of all this experience to change quickly enough.

In addition, I like the relationship that Warren Bennis makes between the ability to change and leadership. A leader must be able to entice followers to come, she must also be able to recognize the need to change herself. This might not always be easy to do both.

How able do you find yourself going beyond your comfort zone, and to process the experience to change yourself?

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How the Rate of Violence Worldwide Is As Its Historical Lowest

During the summer I read a great book by Steven Pinker, ‘The Better Angels of Our Nature: The Decline of Violence In History And Its Causes‘. Basically it demonstrates how the rates of violence in all categories have dramatically decreased over time.

decrease of violenceThe emotionally-laden coverage of today’s news hides the fact that homicides and wars have reached an historical low point. Steven Pinker shows that this observation that violence has decreased dramatically has happened simultaneously in many dimensions:

  • wars (civil wars and wars between entities)
  • homicide and other day-to-day violence
  • punishment by the power in place
  • family-related violence
  • violence against minorities, gays, racial etc.

In our societies, it is 50 to 100 times less probable to be the victim of a homicide than a few centuries ago. In many primitive societies, 50% of people die violently.

I think we need to put in perspective the continuous flow of atrocious information that is fed on us. Of course, what is happening in Syria or elsewhere is terrible, but it is bloated out of proportion by manipulations from all sides.

The world is becoming a better place, Europe has never had 70 years without war for ages, and this will continue to be the trend in the Collaborative Age, with increasing networking and trade between us.

The book is quite long and detailed, alternatively, a video presentation by Steven Pinker is available on Youtube.

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How We Are Becoming Much More Intelligent With Each Generation

I discovered recently the Flynn Effect, the fact that our average intelligence (as measured by the IQ test) has increased dramatically in the last decades in developed countries.

flynn effectThe IQ test is periodically calibrated to have an average of 100 and a standard deviation of 15 points. In many developed countries, the average IQ has increased by 20-30 points over the 20th century: measured as of today, our ancestors one century ago would have been considered mentally retarded (and so possibly also our grandparents).

There are many reasons proposed for this change, the most convincing being better formal education. Also, we now know that IQ only measures one kind of intelligence, and there are other forms which are as important for predicting success and social abilities.

Some recent observations would tend to show rather a stagnation of even a diminution of the average IQ in the last decade, still to be confirmed, and still to be linked with the kind of questions that are asked in the IQ test which only measure a partial side of intelligence. Still, 20th century schooling has shown a dramatic ability to improve the capability it intended to improve!

Anyway, what I find very interesting here is that it appears that our modern habits of mind and education seem to have made us much more adapted to dealing with certain kind of problems that require abstract thinking. What is amazing is the magnitude of the change over 2 generations!

For more information, watch the TED talk by James Flynn on YouTube

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