Posts Tagged ‘Tesla’
In 1917, the Model T was doing so well that Ford decided to stop all advertising. For the next 6 years, they didn’t do a dime of marketing and didn’t need to: over half of all cars in the world were Fords.
100 years later, the next major automotive technology seems ready for prime time: the driverless car. As do some others innovations, like new housing models. Those, and more predictions, below:
- The driverless car product of Tesla, Uber, Apple, and traditional car manufacturers will hit the roads, and not just in a test capacity. They will start to get licensed by state and federal governments, and countries around the world will jockey to make their roads more welcoming so they can get the technology sooner. New business models will come up around car ownership, such as time-share like models for driverless cars. Insurance companies will fight to claim ownership of this market, as well as figure out exactly who is liable in the result of an accident (the car owner, the software, the hardware, the licensing authority, or someone else). Even property prices will start increasing in suburbs again, as people envision a more productive commute thanks to the driverless car.
- As uncertainty in the stability of the west grows, Africa’s rise will accelerate. More companies will get funded in Nigeria, Kenya, and other markets like Tanzania, Rwanda, Uganda, and South Africa will see more startup activity and funding than ever before. Asia will continue to be hot, as China & India continue to see tremendous funding. The exceptions will be Indonesia (where the Christian governor of Jakarta was recently charged with blasphemy) and the Philippines (where the new President has encouraged vigilante justice), where government turmoil will take time to resolve and slow investment.
- The notion of housing-as-a-service will become real, thanks to companies like StayAwhile, Common, Roam, and WeWork. As millennials strive for mobility and flexibility, having a monthly subscription with the ability to live anywhere, instead of locking into 12 month leases, will start becoming a trend. The ultimate question will be, “where do I keep my stuff?”
This guest op-ed was originally published by Forbes here.
Why Silicon Valley Should Help Washington
In Silicon Valley, 2013 will be remembered as the year the idea of separating from the United States went viral. There was the Stanford lecturer and investor, Balaji Srinivasan, who called for “Silicon Valley’s Ultimate Exit,” declaring to a large audience of elite entrepreneurs,”We need to build an opt-in society, outside the U.S., run by technology.”
There was Larry Page, the CEO of Google with a net worth over $30 billion, who suggested a more experimental approach in which technologists “set aside a small part of the world” beyond existing laws and institutions. Page’s vision is shared by billionaire investor Peter Thiel, who in 2008 co-founded the Seasteading Institute to create floating city-states in the ocean.
And then there was Chamath Palihapitiya, another influential venture capitalist, who took a step further in proclaiming, “The government, they’re completely useless… If the government shuts down, nothing happens and we all move on, because it just doesn’t matter.”
It’s tempting for many observers to dismiss these ideas as outlandish: after all, Silicon Valley is not on the verge of seceding from the Union. Yet it is also a fact that the United States has seen few, if any, separatist thought movements backed by such wealthy and elite individuals since the mid-1800s.
Even beyond the erosion of national identity, what this thought movement reveals is a systematic lack of appreciation across parts of the tech community for the role the U.S. government plays in supporting the most innovative economy in the world. Indeed, the U.S. federal government remains the world’s single greatest benefactor of scientific discovery and technological invention, without which Silicon Valley would neither exist nor persist.
In the end, Silicon Valley and Washington need each other to thrive. Instead of dreaming about abandoning U.S. governance, the Valley should strive to improve it — not only through forward-looking policy advocacy, but also through new ventures to make American government more productive.
The Limits of Silicon Valley
It is now well established that Silicon Valley was born largely through U.S. defense and intelligence spending in the 1940s and 1950s, laying the foundation for the global information technology revolution. As serial entrepreneur Steve Blank has documented in “The Secret History of Silicon Valley,” this occurred through a series of federal grants to Stanford and early-stage companies developing microwave systems and vacuum-tubes, and eventually semiconductors and the Internet.
While the State laid the foundation, there is little question that Silicon Valley’s private investors and entrepreneurs ultimately built much of the information technology sector as we know it.And to this day, the Valley remains one of the most forward-looking places in the world: Tesla’s electric vehicles, Coursera’s platform for free higher education access, and Google’s self-driving cars are just a few examples of its companies working to solve big problems.
Despite these examples, there is a growing sense of disappointment with what the Valley is delivering— what some are calling a “systemic failure in the startup ecosystem” that primarily creates Instagrams instead of Hyperloops. As Harvard Business School Professor Josh Lerner concluded, “the venture capital model is no panacea for innovation. The boom-and-bust cycle, the mercurial effects of public markets, and the narrowing of its objectives have made it something far less substantial.”
These trends make sense given the incentives facing most venture capitalists in today’s markets: if the public markets reward fast-growing internet companies like Twitter at multiples as high as 40x revenue, then why wouldn’t investors pursue high-flying software or consumer internet deals?
As a result, VC investment in more capital-intense and higher-risk technologies has fallen substantially in recent years, with software startups increasingly dominating at the expense of sectors like energy, transportation, biotech, and advanced manufacturing. As Peter Thiel has lamented, “We wanted flying cars. Instead, we got 140 characters.”
The Entrepreneurial State
Fortunately, the federal government continues to provide the seed corn for the U.S. innovation system through unmatched investments in high-risk technology research and development (R&D). On the order of nearly $150 billion per year, this commitment far exceeds any other nation and is almost five times the size of the entire global VC market, driving the development of new, foundational technological platforms upon which the private sector builds commercial value.
Nuclear power. Jet engines. The Green Revolution. Semiconductors. The Internet. Hydraulic fracturing. Solar photovoltaics. Gas turbines. Advanced batteries. Recombinant DNA and genome sequencing. All of these blockbuster technologies and more were originally developed with U.S. government funding, and future breakthroughs in path-breaking areas like quantum computing, nano-manufacturing, and fusion power will require the same.
Of course, today it is commonplace for skeptics to point to examples like Solyndra. But whether or not the government should finance large-scale manufacturing facilities is besides the point: even the most libertarian economists agree on the productive role of public spending on research and development.
This doesn’t mean the private sector doesn’t develop breakthrough technologies on its own — the bygone Bell Labs is a prime example — nor should it discourage venture capitalists from developing new investment models. But as British economist Mariana Mazzucato concluded in her recent book, The Entrepreneurial State, “most of the radical, revolutionary innovations that have fueled the dynamics of capitalism… trace the most courageous, early and capital-intensive ‘entrepreneurial’ investments back to the State.”
State of Innovation
Silicon Valley and Washington need each other to thrive: the Valley needs a productive federal government to continue supporting our national innovation system, and Washington needs a Valley that turns new inventions into good jobs and productive commercial products.
Of course, the Beltway city could also use its own strong dose of disruptive innovation to deliver more value. Instead of dismissing government, the Valley should direct more of its energy toward ventures that make it more efficient and responsive. For government operations, companies like Palantir have only scratched the surface in overhauling data mining and analysis capabilities. For government advocates and watchdogs, startups like OpenGov, Outline, and FiscalNote have much greater potential to provide analysis tools on complex public programs. For civic empowerment, there remains enormous opportunity to create information and organizing platforms, such as NationBuilder, to engage the public and make government more responsive. And this is only the beginning of what’s possible, both here and for governments across the world.
For over a half-century, the unique partnership between Washington and Silicon Valley has produced transformational results and helped make the United States the most dynamic and entrepreneurial society in the world. Today, the challenges of the twenty-first century demand even more ambitious and meaningful innovation, and that is why we must renew and strengthen our partnership — not abandon it.
Almost four hundred years ago, 102 English Pilgrims set sail westward toward an unknown land. They didn’t know whether they would survive their harsh journey, but they believed so strongly in their pursuit of freedom, and in their hopes for economic prosperity, that they dared to do what very few had done before. They became one of the first sets of immigrants to arrive at a frontier that would soon become the United States of America. Over time, the United States became a nation of immigrants—an eclectic cultural collage, a melting pot of ethnic groups, and a vibrant microcosm of the world.
Today, America embraces a full spectrum of heritages, from those whose families have been here for centuries to those who just recently immigrated. All of us, at essence, are immigrants. And increasingly it has been immigrants who have empowered our country’s founding promise, and its perhaps most cherished ideal: entrepreneurialism. America has let them innovate, and in return they have innovated for America. In 1784, the second-generation immigrant Benjamin Franklin invented bifocals; and in 2003, first-generation immigrant Elon Musk, who himself was born in South Africa, founded Tesla, building on the shoulders of thousands—if not millions— of inventions and companies launched by immigrants in between. Today, more than 40 percent of the Fortune 500 are companies founded by immigrants or their children. And myriad of America’s most iconic brands are the brainchildren of foreign-born, first-generation Americans. Consider merely Pfizer, Google, and Procter & Gamble as a few examples.
These are the companies, the entrepreneurs, the ideas that make America what it is: a beacon of bold innovation for millions across the globe—a city upon a hill—an inviting shore. And this is the reason I am so thrilled to announce the launch of Innovate for America, a nonprofit aimed at educating Americans about the staggering impact of immigrant entrepreneurs, by measuring the number of jobs they have created. My co-founders Scott Sandell, Carmen Chang, Chetan Puttagunta, and I reached out to a little over 35 of our friends who are building transformative companies as immigrant founders. These companies are now sharing the number of active U.S. employees they have hired across multiple locations. And we are aggregating this data and packaging it into a shareable widget that blazons the total number of jobs enabled by all companies participating.
As the IFA network grows to more companies, and companies hire additional employees, the total number of jobs IFA immigrants have created will continue to rise. Many of the participating companies, as well as non-immigrant-founded entities, have already begun to place this widget on their homepage. Incidentally, the Innovate for America widget, as well as its website, workflow, and back-end, were designed by a hard-working team at another immigrant-founded company, Bloomreach.
With the public launch of our effort, today marks the beginning of Innovate for America. Yet already we have mustered 38 venture-backed private companies hailing from over 20 countries, fueling more than 3700 jobs. This ship has just set sail. And we cannot wait to see how far it goes.
You can read about the launch here in a story covered by The Economist.