Being an entrepreneur today is vastly different than it was 20 years ago. Today, each of us has access to more capital, more technological tools, more information, more talent, and more computational power than the CEOs of the world’s biggest companies did just two decades ago. Steven Kotler, co-author of "Bold: How to Go Big, Create Wealth and Impact the World," explains the basic tenets of what he and Peter Diamandis call "exponential entrepreneurship."
According to Peter Diamantis, we must Understand Exponentials - Ultimately, his personal goal for this course is to mobilize a million entrepreneurs to take on the world’s biggest challenges. We’re political and linear thinkers in an exponential world. Our brains haven’t had a significant upgrade in over a million years, whereas our technology is doubling in power every 18 to 24 months. Exponential technology is transforming products and services and disrupting industries. That’s why Ray Kurzweil and I cofounded Singularity University. Digitized: Turning every product or service into “1’s and 0’s.” Deceptive: The doubling of small numbers is ambiguous. Start doubling 0.1 to 0.2… 0.4… 0.8… and at this phase, it all looks like “zero.” Disruptive: After we reach “1,” just 30 doublings later, we’re at 1 billion. Dematerialized: Exponential technology turns tangible “things” into digital apps. I no longer carry around GPS equipment -- it’s an app on my phone. Demonetized: The cost of duplicating and sending an app is essentially zero. Democratized: Once products and services are digital, they go global and can become ubiquitous. Exponential entrepreneurs use the 6 D’s as a technological roadmap to predict where technologies are going and when to capitalize on the opportunities. This framework gives them an unfair advantage over competitors. Each of these is a stage in the exponential entrepreneur process, which Kotler explains is a great way to get a leg up on the competition.
Exponential entrepreneurs understand that technology is a force that transforms things from scarcity to abundance. Technology is creating a world of abundance in almost every major arena, including energy, knowledge, transportation, computation, access to education and access to healthcare. Once these industries transform from scarcity to abundance, their products and services become cheap (or free), and their quality goes through the roof. Exponential entrepreneurs understand that despite the constant barrage of negative news from the Crisis News Network (my joking term for CNN) and its ilk, the world is becoming better at an extraordinary rate on almost every possible measure, including food, energy, education, poverty, and health.
Exponential entrepreneurs also know that scarcity-minded, closed business models ultimately fail, and open platforms eventually win. Exponential entrepreneurs constantly experiment and have a deep sense of curiosity about a group of exponentially growing technologies:
- AI/Machine Learning
- Sensors & Networks (Internet of Things)
- Digital Manufacturing/3D Printing
- Robotics & Drones
- Virtual and Augmented Reality
- Synthetic Biology and Genomics
- Quantum Computing
- Material Sciences
Exponential entrepreneurs understand that these are the technologies that can transform and disrupt industries. They see how these technologies are allowing individuals to do what was only possible by governments and the largest corporations. And further, they know that today, you don’t have to become a technologist yourself, but instead take the first step: to understand the potential and implications of the technology. Mindset is everything. Exponential entrepreneurs have a Massively Transformative Purpose (MTP) that drives them to power through hardship and attracts the best talent to join them. The most successful entrepreneurs then use their MTP to power their Moonshot, product or service in which they are going 10X bigger than everyone else. Finally, these entrepreneurs subscribe to Google’s eight innovation principles, making them central to their startup mindset:
- Focus on the user
- Open will win
- Ideas can come from everywhere
- Think big, but start small
- Never fail to fail
- Spark with imagination, fuel with data
- Be a platform, float all boats
- Have a mission that matters
Exponential entrepreneurs have the opportunity to crowdsource nearly everything they need -- ideas, capital, design, software -- to grow their company. We live in a hyper-connected world of 3 billion, growing to 7 billion+. Around the world, the cognitive surplus can help you build your products, services and drive innovation, regardless of the size of your company. As Bill Joy, cofounder of SUN once said, “No matter who you are, most of the smartest people work for someone else.” With current technology, people can work from anywhere in the world at any time, and large corporations can tap into this global knowledge base to improve their systems. Perhaps one of the most compelling aspects of the crowd is its ability to provide you with capital -- either in the form of equity or advanced market commitments. Crowdfunding has grown into an opportunity worth multi-tens-of-billions of dollars, providing more money to today’s startup game than any time ever in human history. Access to startup capital is no longer scarce. There are proven ways to run a Kickstarter or Indiegogo campaign; for exponential entrepreneurs, these capabilities are second nature. Finally, you have the opportunity to create incentive competitions through platforms such as HeroX.com that allow you to crowdsource technologies, designs, solutions… whatever you want. This is an important tool in your tool chest. All you need to know is *exactly what you want* -- if you do, most times, the crowd can do the rest.
Exponential entrepreneurs bring their ideas to life. These entrepreneurs understand the importance of action, rapid iteration, and experimentation. They follow Reid Hoffman’s philosophy: “If you’re not embarrassed by the first version of your product, you’ve launched too late.” As such, exponential entrepreneurs understand the importance and means of rapid experimentation and iteration. They push tirelessly to reinvent and disrupt themselves. They drive idea exchange and create a culture of idea interaction capable of fostering creative solutions to previously unsolvable problems. They understand where, when, why and how breakthroughs happen inside of the communities they create. They know how to consistently keep their companies, ideas and processes focused on the future, moving forward, and leveraging the latest exponential growth techniques in the pursuit of even bigger goals.
Secret #1: Big Goals—Setting Moonshots
Companies do not "go skunk" for business as usual. They do so to tackle Herculean challenges. Skunkworks is built around what psychologists call high, hard goals. Big goals lead to the best outcomes—if you want the largest increase in motivation and productivity, then form teams around "moonshots," as Google calls them. Big goals significantly outperform small goals, medium-sized goals, and especially vague goals for two reasons: focused attention and increased persistence. The team is more willing to try again if they fail the first, or second, or third, or one-hundredth time.
Secret #2: Extreme Isolation
Steve Jobs famously said, "It's better to be a pirate than join the Navy," as he hoisted a pirate flag outside the building housing his Mac development team. This may be the most important key to success in a skunkworks. You have to wall the skunkworks off from the rest of the corporate bureaucracy. Isolation stimulates risk taking, encourages weird and wild ideas, and acts as a counter-force to organizational inertia. Organizational inertia is fear of failure writ large. It is the reason Kodak didn't recognize the brilliance of the digital camera, IBM initially dismissed the personal computer, and AOL and Radio Shack barely exist anymore. Astro Teller, the director of Google X (Google's skunkworks innovation lab), says, "In any organization, the bulk of your people will be climbing the hill they are standing on. That's what you want them to do. That's their job." "A skunkworks does a different job. It is a group of people looking for a better hill to climb." "This is threatening to the rest of the organization. It just makes good sense to separate these two groups."
Secret #3: Rapid Iteration—The Importance of Rapid Feedback Loops
As my coauthor, Steven Kotler likes to point out, "the road to BOLD is paved with failure." This means it is critical to have a strategy in place to handle risk and learn from mistakes. As the unofficial motto of Silicon Valley goes, "Fail early, fail often, fail forward." Instead of launching a finely polished gem, companies now release a "minimum viable product," then get immediate feedback from customers, incorporate that feedback into the next iteration, release a slightly upgraded version, and repeat. Instead of design cycles that last years, the agile process takes weeks and produces results directly in line with consumer expectations. As LinkedIn founder Reid Hoffman says, "If you're not embarrassed by the first version of your product, you've launched too late." This is the rapid iteration. Trying out crazy ideas means bucking expert opinion and taking significant risks. It means not being afraid to fail—because you will fail.
Secret #4: Intrinsic Rewards
For most of the last century, science focused on extrinsic rewards, that is, external motivators. These are "if-then" conditions of the "do this to get that" variety. With extrinsic rewards, we incentivize the behavior we want more of and punish the behavior we dislike. For example, in business when we want to drive performance, we offer classic extrinsic rewards: bonuses (money) and promotions (money and prestige). The problem is: a growing plethora of research shows that extrinsic rewards have greater costs than benefits. Once people's basic needs are no longer a constant cause for concern, extrinsic rewards lose their effectiveness and can crush the high-level, creative, conceptual abilities that are central to current and future economic and social progress. Intrinsic rewards, meaning internal emotional satisfactions, become far more efficient. The secret to high performance is our deep-seated desire to direct our own lives, to extend and expand our abilities, and to fill our life with purpose. Gaining autonomy, mastery, and purpose is motivators enough to make us work to our highest potential.
The only constant changes and the rate of change is increasing. Learning is a continuous process; continued education is paramount in exponential times. We have to disrupt yourself and your business or someone else will. An explosion of exponential entrepreneurs have provided access to resources around the globe, for instance, another new 3 Billion people will join to the Internet in the few years. Mindset matters. Seen the world as sufficient causes you to seek for opportunities and try them out.