Collaborative Age | The Fourth Revolution Blog

Perfecting the Rules for Crowdfunding: Reminding about the Risk!

Crowdfunding is still polishing its model. In September 2012, to make they would remain true to the ideals of crowdfunding, Kickstarter did a significant change to its rules. Conscious of some deviations and criticisms, the new rules aims at making sure that people do not mix up crowdfunding and purchasing new items (follow the link to Kickstarter’s announcement “Kickstarter is not a store”).

This came after some hefty criticism that some of the projects did not deliver to the funders the goodies that were supposed to be delivered (because you don’t crowdfund for free – refer to our post “Crowdfunding is not charity – and it is not free!”).

It is a good reminder that crowdfunding projects do entail a significant amount of risk – the risk of innovation. Some will fail, and even the products that are to be developed by big names might end up being disappointing! This is the game of innovation, and statistically failure will happen; and so-so results will be the majority. The infographics gives some statistics as of June 2012 on the ratio of failure to successes; a more detailed infographics is here.

It will be tough for Kickstarter to maintain the clear message that Kickstarter projects, although filtered out by the crowd, are still risky endeavor and that the thrill is to follow the people try hard and maybe fail. Crowdfunding will remain an isolated island in our world of quick and immediate gratification; and those reminders from crowdfunding organizations will necessarily have to be repeated often, again and again so that we don’t forget that it is some kind of risky venture investment.

Nevertheless, it is good to see how the crowdfunding model is getting refined to stay close to its true calling. It will probably take another couple of years until the model is really settled (enough time so as to have enough feedback from completed projects – as they only start to really trickle in after the enthusiasm of their initial launch). Let’s follow up how that evolves!

The infographics is by Appsblogger.com; follow this link for the full infographics; and this link for the blog post on “Kickstarter failures revealed”.

How the Anonymous are a Precursor of the Collaborative Age Organization

This interesting article in the Guardian “Disorganized but effective: how technology lowers transaction costs” highlights how lower the transaction costs has allowed the development of such amorphous groups such as Anonymous or the Occupy movement.

Interestingly, the article takes a perspective on the dramatic change of our capabilities in terms of ‘transaction cost’ that is very similar to our Fourth Revolution concept based on our communication capabilities. It is the same of course. The previous Fundamental Revolutions always saw the creation of more organized bureaucracy – the Agricultural Age’s bureaucracy paving the way for the Industrial Age’s Corporation. The Fourth Revolution is the era of chaos and complexity. And for the first time we can organize chaotic groups that deliver effectively.

Not just the Anonymous, Occupy, other activists but also many groups that are not so much on the dark side, like all the Open Source movement: these are all amorphous groups without visible structure; their weak structure is constantly evolving and never fixed, completely akin to turbulent flow. They rely heavily on technology to communicate, using automation and a choice of synchronous and asynchronous tools.

These groups are in advance on their time; soon we’ll all participate to such groups because chaos begets creation, the value engine of the Fourth Revolution. They are the real precursors of the Collaborative Age turbulent organization.

Welcome to a chaotic, and effective world – Welcome to the Future of the Organization!

How the Fourth Revolution is the era of the individual widget – even for drugs!

The Industrial Age was all about mass production and production for the bulk of the population. That was in particular the dominant economic model of big pharma. Rare diseases were not tackled for the lack of economic viability.

Today this changes completely. Some biotech companies are extremely successful at making drugs for rare, orphan diseases. And social security or private insurance is happy to pay for the hefty price tag – because those diseases are so rare. In this great paper in Forbes, “How A $440,000 Drug Is Turning Alexion Into Biotech’s New Innovation Powerhouse”, we get a great insight into a new business model. A business model which addresses the needs of individuals at the fringe of the mass production model, while remaining profitable.

As in many fields, the Collaborative Age is the Age of production for the individual of customized products. Pharma is just one example. The revolution in manufacturing will bring the same result – produce widgets one by one, on demand.

In the medical field, medicine is becoming more and more individualized. Genetic factors are increasingly taken into account before administering medicines or X-rays, as sensitivities vary. Soon we won’t get mass produced drugs but drugs specifically generated in dosage and type for our own case.

The Fourth Revolution is the era of narrow niches – so narrow that it addresses an individual. Are you still stuck in the mindset of mass production? Change now to understand the world as it transforms!

What really is stardom nowadays? Can’t you just be the star of your tribe?

In the article “How the internet killed Carly Rae Jepsen” on MTV hive, the author explains how Carly’s new album is (relatively) a flop. Is that contradictory with our recent post on her incredible viral summer success ‘Call me maybe?’ (“Done! The Fourth Revolution put the music industry upside-down!“?)

I would like to argue that it is not because her album has a slow start start it does not mean that she will not succeed on the long term as a noticeable artist. Anyway she is now geared to participate to Justin Bieber’s concerts for the next few months. She is releasing videos and continuing promoting her work.

But the most important thing is that the internet / social network age is all about tribes, and not necessarily mass consumption. Stardom in the industrial age was necessarily at the level of the entire population, of an entire country: you could not so much have several products competing for different sections of the population. Following country-level sales made sense. With the Fourth Revolution, this kind of stardom is doomed to extinction, or will at least be less important. Stars will be stars of smaller global tribes of a few million people scattered over the world. These tribes will often not be defined geographically but more by taste and lifestyle. A star’s influence can be greater through a tighter connection will less people than with a looser connection to everybody.

In any case Carly sold more than 100,000 albums – how many would-be singers would kill to achieve that? She might not be on the road to become a global star, but she certainly is building a strong base for success, within a certain tribe on which she will have a great influence. Will she manage to establish herself as a star for her tribe? Time will tell!

Hat tip to Laurent Riesterer for the link to the MTV hive article.

How the Fourth Revolution transforms the market for work

Our Industrial Age world is apparently in a crisis – employment rates diminish currently for most generations, and those who are employed are increasingly so on a part-time basis. The proportion of salaries in the net national value creation is diminishing.

Contract work - the new work framework — Contract work – the new work framework?

Yes, the Industrial Age model of salaried work is in a crisis – not a crisis actually, but a transformation. Even the Harvard Business Review now blogs on “The Rise of the New Contract Worker”, or how increasingly people look for alternative forms of work. Not straightforward employment but rather innovative forms of work and compensation, which generally imply some sort of contracting or more or less informal grouping.

The portion of salaries in the economy will further diminish because more and more people will be contractors, on their own or in small ad-hoc companies. The inter-mediation cost has dropped dramatically with freelance platforms. When countries will give even more flexibility on such basic social services like health insurance, the proportion of freelance contract workers will only increase.

The salaried worker working exclusively for one single employer is dying. What will replace it might increase anxiousness for some because of the apparent risk and the need to market oneself; yet it will unleash the creativity of the world by making sure that all work that gets done really contributes to creating value.

An employment market crisis? Reframe it: it is just a deep transformation of the way we will get compensated for work! When do you start taking this opportunity?

The Fourth Revolution in action: already baby steps towards direct democracy

We argue in The Fourth Revolution book that representative democracy is a remnant of the Industrial Age travel limitations and that forms of direct democracy will emerge as a result of the Fourth Revolution.

Ready to Ask Your Question to Your Representative?

Some hints of that shift can already be observed. The website AbgeordnetenWatch.de (literally Parliamentary Watch) in Germany is a website that connects citizens and elected representatives. According to David Eaves, a guru of open data, the German site has, since 2004, posed over 140,000 questions from everyday citizens of which 80% been answered by politicians. According to the website itself, in average, the website counts 10.000 Visitors a day and about three million page impressions per month; two thousand questions are asked through the portal of abgeordnetenwatch.de each month and questions and answers are visible to all visitors.

This type of websites will extend and become progressively central to our countries’ governance. Eventually citizen’s questions will be relayed in parliament and to government and answers posted in such forums.

The Fourth Revolution is coming quickly. Old-fashioned politicians beware!

Can a national “growth mindset” make the difference?

In a previous post we explained Carol Dweck’s approach to “fixed” versus “growth” mindset. Carol Dweck’s considerations are at the personal level. But what about the national or collective mindset?

The Industrial Age mindset is very much a “fixed mindset”. This was clearly shown by the myth of the ‘fixed IQ’ (your intelligence is innate, you can’t change it); the Freudian approach of seeking what could have happened in your past that determines what you are today… and many institutions in several countries where one’s professional fate is essentially determined by one’s academic prowess.

Wen Jiabao wearing the Polytechnique hat — Wen Jiabao (China’s Premier) having fun wearing the Polytechnique hat during a visit to the French elite school

Still there were cultural differences in these instances, that originated from a distant cultural past. Some countries like France or China are very much “fixed mindset” – you intelligence is a given and expressed by the school you visited (and entered through a competitive examination); and that essentially determines your career and social status. Even when you are 50 or 60 years old people ask for your school studies to determine your social ranking! Other cultures like the British or the American appear to be much more of a “growth mindset” and it is usual to consider the present qualities, abilities and skills of people and not so much what they studied 20 years ago (albeit with some limitations in the upper ranks of society though).

As we step into the Collaborative Age we understand the tremendous damage that a “fixed mindset” can have on individuals and also on entire societies.

The solution to the crisis of the Western World, and to the transition in the Collaborative Age, is to adopt a “growth mindset”. Through learning, development and experiment can we all as a society reach a higher condition. Let’s switch our collective mindset to a clear, unequivocal “growth mindset”!

Leadership is about Dealing with Conflict

As a follow-up of our post on Openness Alone Cannot Drive Change and the fantastic video by Margaret Heffernan, let’s reflect a bit about what this means for the leader in the Fourth Revolution context.

Head-in-Sand executive — Not the leader we need!

Indeed, as Margaret Heffernan explains, leadership is dealing with Conflict. Dealing with the information that is available and contradicts our usual vision of the world, or requires us to review our world-view.

It is so amazing to see all the time those situations where people don’t stand up to situations. Because that is hard and risky.

It is difficult to give feedback to someone who is creating anxiousness by their behavior, or who just plainly behaves in a way that is negative for himself and his environment. It entails creating a bit of conflict for the sake of resolving a much larger issue.

Wouldn’t the right definition of leadership be: being able to stand up, be assertive and courageous to address conflict in a constructive way – or create the right amount of conflict at the right time ?

Not just addressing conflict in a destructive manner, but recognizing tensions and addressing them in a way that creates value. Addressing them in a way that cares and brings us to a better world.

Are you ready to look into the face of Conflict and lead us?

Social Product Creation: Quirky, The Collaborative Invention Unleashed!

Take 6mins and watch this video of the Quirky manifesto – one of the most enlightening videos on the Fourth Revolution’s process and possibilities:

Quirky Manifesto from Quirky on Vimeo.

Quirky is a successful startup that thrives on social invention. Inventions are sorted out by the crowd, and if selected, inventors get royalties… and not just inventors: those that were influential in the later development of the idea, the name, the tagline or the color too!!

The development of this startup is astounding. Launched in 2009 it now launches 2 new products per week.. and they have paid millions to inventors and contributors. More information on this post by Mitch Joel.

Quirky now gets full attention: Quirky just raised $68 million and the attention of highly influential venture capitalists.

Think about it: a startup which is collecting ideas from anybody, put them to proof and vote, builds them, compensates all the crowd that was influential in producing the product… and unleashes the inventiveness of the world.

The Fourth Revolution has not finished to astonish us!

The Exponential and the Black Swan: The Counter-Intuitive World of the Fourth Revolution

Following our posts on the Fourth Revolution being the realm of the exponential, this nice blog by Paul Graham (a famous Venture Capitalist investor), “Black Swan Farming”, brings closer the related issue of the fact that today, success is extremely rare – and extremely successful. And that as much as the exponential is not intuitive to us, this situation also escapes our common sense. It makes it in particular difficult to take action and put our stakes on the right candidates.

In the case of startups this expresses itself by the fact that only a very, very, very small handful of startups will make it really, really, really big (1,000x the initial investment or more); and they dwarf almost every other investment – they dwarf hundreds of other investments which either outright fail, or just live on with a nice but limited growth.

This is difficult enough to apprehend; where to invest in is equally counter-intuitive: it is mainly in ideas that seem at first view utterly pointless, and that are not popular.

The important idea in this blog is the fact that the situation is so counter-intuitive that we would need in fact to suspend all kind of intuition about whether a startup could be successful to increase our chances of final success – by taking more risk and capturing more of these freak Black Swans.

We already live in a world which is counter-intuitive through exponential and freak events – we absolutely need to change our frames of mind to thrive in the Fourth Revolution. What are you doing to change from the linear vision of the Industrial Age?

Why the Fourth Revolution is the Era of the Exponential, and How this Changes Everything

The Fourth Revolution is the era of the exponential – whereas the Industrial Age was the era of linearity. And that changes everything in the way we live our life:

Moore's Law 1971-2011 — Moore’s Law 1971-2011 (from Wikipedia)

the complexity of the products we use every day increases exponentially. For example the Moore’s law states that microprocessors density on chips doubles every 2 years; and that’s the case for many other products we use every day without realizing it;
Successful companies and services grow exponentially, soon dwarfing existing players (the revenue of Apple was multiplied by 11 in 10 years… not to mention the even more exponential growth of the Facebooks of the world)

In the Industrial Age, things were more linear. It was easier to extrapolate the future from the past. Of course a factor is that things go faster today so that it is easier to watch exponential change in action. Yet the Moore’s law rate did not change in the past 40 years or so. Microprocessors’s density still double in the same number of years. So speed of change is not the discriminant. The fact that things grow visibly exponentially and have higher ceilings than before makes the Fourth Revolution different.

story of rice on chessboard — Are you sure you want to get to the end of the chessboard?

The problem is that we are not geared to feel intuitively the power of the exponential. It is very difficult to seize how fast it can grow. Do you remember the tale of the wise man that told the King who wanted to thank him: “only put a grain of rice on the first square of a chess board, then on the next square put two, then on the next square put four, then double for each square until the end of the chess board…” The King never realized that at the end of the 64 squares the quantity of rice needed would vastly exceed his available supply – and the world’s supply and even more!

This explains why so many people today have difficulty understanding what happens in the world. In their linear Industrial Age mindset, they can’t grab how the exponential is changing our lives faster and deeper than ever before.

Are you ready for a world full of exponential change?

Thanks to Mitch Joel and his post on “The Era of Exponential Marketing” – a specific area where most people also don’t realize we are in for exponential growth of product sales- for the inspiration.

The great picture of the rice on the checkboard is by Paul Starkey on Flickr.

Publishing A Book is Not Any More a One-Way Broadcast

If you are a e-book reader you might have noticed that you can type in your notes and share your text highlights with other readers, the world… and the publisher.

Publishing a book is not any more a one-way broadcast. And the role of the distributors has increased dramatically. Since a decade, readers can easily speak their mind on all books on most e-bookshops (the distributors) – which in effect is a sort of crowdsourcing of opinions. I now look at who recommends the book and what the opinions of readers are before buying.

ebook interactive reading — Ebooks add a layer of interaction and can spread your notes and highlights

Now an other layer of feedback has been added with e-books. Distributors like Amazon or Barnes & Noble can also get feedback from the inside of the book when you read them. On most e-book reading devices you can take notes and highlight quotes – and share them with the wider community – and the publisher.

This paper in the Wall Steet Journal, “Your E-book is Reading You” explains that the distributors have only started analyzing that huge pile of data.

And because of this huge trove of data, and the insights that will be derived from what the readers like or don’t like, the power of the Publisher will vanish while the power of the Distributor will soar – and we can predict that soon Publishers will be taken over by Distributors, like Amazon is already doing.

Publishing books started the Industrial Revolution, the era of Broadcasting. Today, publishing books enters the Collaborative Age in full, allowing almost real-time interaction with the readers. And as with other industries, publishing will be put upside down by the Fourth Revolution.

M	T	W	T	F	S	S
						1
2	3	4	5	6	7	8
9	10	11	12	13	14	15
16	17	18	19	20	21	22
23	24	25	26	27	28	29
30