The Intersection Event 2013

Entrepreneurship panel @ The Intersection

Spent an inspiring day at The Intersection Event at Googleplex. Full agenda is here and my notes from the sessions below.

Women

Panel: Helene Gayle (CARE), Sheryl WuDunnLorraine Twohill (Google), Jennifer Pahlka (Code for America)

  • A new microlending model which also takes local micro savings in as capital, more effective virtuous cycle. Cases where a $2 loan to a woman triggers notable spillover family & community change.
  • There are 60-100 million women “missing” in the world versus the natural demographics (birthgiving related deaths, girls in india get 50% less medical attention and vaccinations, abuse, etc)
  • We wrote a book on these issues – but who reads a book in the US, so we took the topic to other media. A film with massive twitter follow-up. A mobile game “9 minutes” to teach women in india about pregnancy, one minute per month
  • Google gives $100M of cash to charity, but about $1B in technology
  • Models are transferring back to developed world: microloans in Bronx, addressing teenage pregnancies in Western Europe
  • Many social issues are still rooted in isolation of affected individuals, creating group dynamics is where technology can be most effective (mobile, internet cafes in Afghanistan). Also, role models don’t work if the target group have no way of seeing them.
  • Daughter management: “I won’t pay for your wedding, but will pay for your college”

Artistic Creation

Marla Olmstead - 12 year old painter

  • Helps to approach something you’re doing without knowing you are not supposed to be doing it (for age, skills, finances, whatnot)

Entrepreneurship

Panel: Jason Yotopoulos (SAP), Reid Hoffman (Greylock, LinkedIn), Tim O’Reilly

  • In information age you go out and search for people, in network age you inject yourself in a network so that people can find you (from Reid’s TED talk)
  • You can have two kinds of company cultures: missionary or mercenary. First tends to work better.
  • Networks, marketplaces and platforms as the underlying layers (Reid’s investment thesis). Many of the startups attacking big issues (like education) don’t try to position themselves in this layer, which makes them a lousy VC investment despite all the social good.
  • Myth that entrepreneurship is what happens when other people leave us alone. Actually every startup needs a platform to build on, networks around them, government’s support (even if just moral, but also regulatory, taxes, education for staff etc). Surrounding support should increase network density and reduce friction – and just maybe provide direct incentives.
  • 6M mom’n’pop stores in India, absolutely no transparency in that part of the value chain (SAP attempting to get wireless POSis out)
  • The Web 2.0 Labs: initiative on community-based educational technology (ed tech) projects.
  • Disruptive startups take $10 of revenue off an incumbent and replace with with $1. Some (guess who) still think this is destructive, but because of the accessibility it enables, this is actually progress.
  • Some phrases that you are soaked in when growing up in US: “It’s just business”, “The main goal for companies is to make profit for shareholders”.Early LinkedIn rule: if what we’re doing shouldn’t be printed on the front page of NYT or you couldn’t tell your friends over dinner – we should not do it.
  • You have to be both contrarian and right. Contrarian doesn’t always mean “contrary to common wisdom”, but just something that is ignored by others. Given that, how do you break out through the noise, stand out of the crowd?
  • Even while being contrarian, you shouldn’t leave networks and become a single node. Maybe there is a smaller network of complementing contrarians?
  • Tide rises all the boats. Startups have always executional challenges, but there is much more forgiveness if you’re on the right tide.
  • Code for America, Vittana, etc kind of social startups need a shift in capital structures, including foundations learning how to do tech investments
  • All venture investors look for high growth. How can something be high growth today if it doesn’t rely on technology is an interesting question. Starbucks?
  • Coursera changed charging for courses to charging only for the certification in the end. Most disruptive businesses are also business model innovations.

The Click Moment

Frans Johansson - author of The Medici Effect

  • The business case for diversity
  • New book: The Click Moment: Seizing Opportunity in an Unpredictable World
  • More videos of Frans talking about his books - very entertaining speaker
  • Sweden’s largest agricultural export product: Absolut Vodka
  • Serena Williams’ first memory of anything is playing tennis. Gladwell’s 10000 hours really works in sports, because the rules of the game are stable. Reed Hastings didn’t have 10k hours of video rental experience before Netflix. Branson didn’t have any experience in airlines, etc. It is OK if you are about to change the rules of the game.
  • The issue with trends is that if you know of one with so high certainty you can safely bet on it – then everybody else knows about them too.
  • Purpose of strategy is to convince yourself to act. Reject the predictable plan, though.
  • Mirror’s Edge - a game that changed team formation dynamics
  • Education is structured around some foundations that don’t sound right in the real world. Do you worry if a 25-year-old has 26-level math? Why does it matter in 8th grade?

Evan Williams (Obvious, Twitter, Blogger, etc)

  • The risk with the Lean Startup movement is that if you reduce this to just a sequence of attempts to throw spaghetti at the wall as cheaply as possible, you might take the bold vision out of it completely.
  • Building something you wanted to exist in the world is a hack against that.
  • Faking is a useful skill for a leader, for example projecting confidence to your team about the future when you can only be confident about the uncertainty. I am usually confident about the big things and less confident about the small ones.
  • Medium is a place to share stories, ideas, knowledge that is longer than 140 characters not just to your friends.
  • Consumer and enterprise are too different DNAs, Blogger was tempted to go to enterprise (even had a pilot at Cisco), but rejected it.
  • I care for the essence of a product. I am not one of those saying that adding more features is bad. I am against feature creep that changes the essence of the product, trying to make it something else. Google search has gazillions of features, but how you use it has never changed: you type in the box.

Google Car

Science

Panel: Steve Jurvetson (DFJ), Nathan Myhrvold (Microsoft), Greg Brandeau (Pixar, Disney)

  • Biotech is probably most “scientific” entrepreneurial scene. Other “complex” ones, like space travel, are often better implementations based on known scientific facts, creating less new fundamental knowledge.
  • Pixar software team was fed by New Jersey Tech, which happened to be very strong in computer graphics research. You don’t need to be the best known university globally.
  • Science is as close to magic as anything we have. When you understand a new aspect about how nature works, you can do something that looks utterly unfair advantage to everyone else.
  • Humanity has never really had a positive arc heading to the future. It was more about ups & downs, bad and good seasons variating on the field. Moore’s law has been heading up for 110 years now!
  • Innovation is ideas having sex.
  • SpaceX has lowered the cost of space flight by 10X – only natural if the underlying tech had not been touched for 25 years. It will get another 10X when you make rockets reusable – imagine throwing away a plane after every flight! It will be cheaper to fly around a world in a rocket on orbit than an equivalent plane. First for one person, then 7, then for 100.
  • Already today there are more electric vehicle drivers in China than cars in the US. 1300 manufacturers, mostly 2-wheelers still. EV is inevitable, US spends $2B/day on car fuel.
  • Drop in cost of reading and writing gene data is making Moore’s law look flat.
  • Humanoid robots in production are replicating unskilled labor – learning and optimising what they do by watching the routine hand movements.
  • When the Human Genome Project started, biology was not one of the “big science” areas for funding – natural counter pressure from incumbent areas to its rise.
  • It we don’t discover anything surprisingly new beyond the Higgs boson from LHC, it will be much harder to raise funds for next $10B+ core science research project
  • New telescopes are costing $B
  • Recurring arguments on the “end of innovation” are flawed. Look at single country, single industry numbers. Look at median salaries not raising in US since 1975 – ignoring averages and growing poor-rich gaps. Ignoring structural changes in parallel (employment in agriculture -> manufacturing -> …)
  • Killing a cow is the least effective way to make a steak.
  • $100M satellites in orbit are less powerful than modern phones.

Social Innovation

Bill Draper (Draper Richards), Randy Haykin (Outlook Ventures)

  • Started in venture capital in 1959.
  • Returned 16X on LPs money in India in 6 years – pays to be first.
  • Granddaughter Jesse Draper started Valley Girl Show
  • John Wood (Room to Read) – book: Leaving Microsoft To Change the World
  • Bill’s book: The Startup Game
  • When your learning curve flattens – either change jobs or write a book
  • People who think immigrants are taking jobs away are crazy. We’re sitting at Google!
  • Despite his known harshness even Steve Jobs had empathy, to the user.
  • Serial entrepreneurs with a very quick turnover look suspicious – are they able to really stick through the tough times?
  • Don’t ever wait for a board meeting to tell your VC the bad news
  • Became the first investor in Skype by accident. Hired Howard Hartenbaum, asked him to go to Europe because it is less crowded there. Tracking the guys behind Kazaa (sued to death by Hollywood by then) found them writing a business plan for the next thing…
  • Early days the VC deal was: we put up the money, you put up the blood-sweat-tears and we’ll split it 50-50. If it was a $4M deal, we’d take $2M, give one to Kleiner and one to Mayfield. Much more competitive now.
  • Carnegie had a philosophy: 1st third of your life you get educated, 2nd – make a lot of money, 3rd – try to give it all away intelligently. Making money is OK and keeps your home happy, but giving it away is much more rewarding.
  • The social entrepreneurs we’ve backed that have done the best have first been successful in a money making organization.

Gratitude Awards finalists

  • Zaya.org - physical boxes to take educational content to non-connected schools
  • The IQ Collective
  • Mytonomy
  • Beyond 12
  • Springboard Collaborative
  • Vittana - microlending to students in developing world. Has financed 8000 students to date. 2013: $15M, 25000 students, tripling. Ex-Amazon founder, backed by Khosla.
  • Motion Math - games that teach kids math. A week of gaming: +10% skills.
  • The World We Want Foundation - funding platform for social action projects initiated by young people.
  • Kytabu - textbook subscription service launched in Kenya. Use cheap $25 tablets to access pages, paragraphs of textbooks on a time-bound subscription basis, for fractions of cents. Mobile payment penetration in Kenya 78%, $1B+ daily volume.
  • OneGoal - college persistence program to reduce the number of drop-outs.