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TEDx Talks
Published: 2012-12-10
Source: https://www.youtube.com/watch?v=ATLUouxwykM
you know afternoon good to be here %HESITATION at tech Salford's I was sent headaches muscle I think this is bigger I think we're doing a bigger herein Salford's I'm going to talk to a little bit this afternoon about that guy isn't it great I love the face of that guy that's the face of every entrepreneur just in case you didn't know that they may not show
it to you but never forgets that bots the face that's going on inside of them and so the next time your cousin or your brother or your friend down the street or you work colleague says they're going to do something akin to set up a business so they are setting up a business and they're doing acts in the same not Sir it's gonna work just remember
that inside they've got that that look going on and they're they're gonna show it to you now I frequently say follow the onscreen I'm gonna give you two reasons two good reasons why we should as a nation as a group of people follow the onscreen are Alison really the following they see the inevitable entrepreneurs through dense have been sometimes that off the reservation or a unique
experience in their job or some sort of special intelligence or market opportunity they see what's coming down the pike they see the future they see what inevitably is going to come most importantly they're willing to live abnormal lives you can define abnormal however you want to but I think we all know what we mean I think we all have a friends or or a loved one
that's working on more than a workaholic they're they're living in abnormal lives a life to bring the future to us and those are two good reasons why I think we need to follow the entrepreneur now if I think about my own industry venture capital and if I can go back go back as far as Christopher Columbus go back as far as Michelangelo think about the people
who other people besides Deborah across the ocean other people who painted the Sistine Chapel we've had that class of people entrepreneurs throughout history we have always called them once the nerves sometimes have called them creator sometimes if called them adventures except for but there's been a dynamic throughout history for a very long time there's a group of people who see the future who worked abnormal lives
to bring that future to us and there's another group of people who have capital and that capital follows the money and that to me was a major revelation when I was living in Paris in my early twenties obsessed frankly about having no money I thought my god how making a breakthrough I know no one of come to this country and they work waiting for me and
I'm like god when my going to do and so my friend at the time said stop worrying about the money if you're good at what you do if you're meant to do it the money will find him I thought that it was the most ridiculous idea idea I've ever heard and I told him that until I stop to think about and said well you know he
is older successful wiser exciter and actually the past twenty five years it's been one long example of them the less I focus on the money the more I focus on my unique contribution the more I focus on what I meant to do my unfair advantage play to my strengths the more the money finds me and I really encourage you to think the same way but the
bigger issue is that it is not the financial services industry thinks it's an industry it's not a service industry to industry and that's what we gotta get everybody understanding that what we're here to do is to back industry I'm back digital industrialists on the capital provider to digital industrialists and that's the proper order of things and throughout history capital has always followed ideas and the people
who were at the front of of preventing those ideas and building structures businesses companies countries except for around the leading ideas of the day Queen Isabella was no nothing more than a woman who put Christopher Columbus on a retainer the Medici family were there to back Michelangelo as he explored and developed the Sistine Chapel so just remember when you're thinking how do I get that money
I can't do anything because I don't have any money wrong capital follows ideas always has always will so remember the new link the new economy turns out it's only the latest version of new how many of you have heard of Carlotta Perez not that many hands going up out there put it on your reading list Carlotta Perot's theory of disruptive technology in a Datsun basically what
Carlotta has done very helpless look at the past couple hundred years and she's pointed out there's a moment of disruptive technology from which sixty to seventy years of technological change emerges and one of the things that's most missing from the narrative that we read in the business papers and publications and so forth that that that the country reads as understanding how technology creates prosperity it's not
just a niece industry from some of us who love to hang out with technologists it's actually one of the key drivers and lovers of change and growth and prosperity you can't be a high growth business and lesser leveraging finance and technology you can be a good business you can be a life some business you can be an honest hard working managing director of the business but
you can't actually be a high growth business but that technology and finance so this this little chart here to show shoot those moments of disruptive technology the big bangs of technological change and then what happens is a cycle of it's the installation of new technologies and the deployment of those technologies into big business and what Carlotta did as she was a Venezuelan economists you went out
to Silicon Valley where where I grew up in nineteen seventy one she was expecting to study oil and invent that it changing of courses that Deborah spoke about what she found she found the the Intel microprocessor she went to study oil she ended up studying the microprocessor and she realize that the phenomena but she was witnessing was none other than one that comes every six years
seventy years and then you have a series of installation and deployment of those technologies in here just a couple of companies and people that you will recognize all that have stand out like concentric circles from that Big Bang of disruptive technology so the revolution starts as a small fact with big promise and moves to become a significant force in the market and that's why I never
under estimate any entrepreneur that I meets the first time I met Niklas Sundstrom had been raising capital for eighteen months he didn't look like the guy who was gonna sell Skype to eBay lesson two years later for two point five billion dollars the most important things in life start off as a small fact with huge promise and they can become signet significant forces in the market
and in your life if you believe in them now these big banks attract new investment I was asked earlier what what should I go out to Silicon Valley to set up my business I said no there some of us that are trying to get the capital providers and we are kept providers to back the companies that are built around the technologies most importantly I say a
new context is emerging and for those of us who understand that a new common sense is emerging in the world we need to communicate that the future is not going to be like the past the job that you have tomorrow is not gonna be like the one that you lost that there's a a process of constant change and that while it's difficult it's inevitable and that
we have to be the purveyors of saying there's a new expanding pie there's a set of changes that technology is going to bring to our lives and we have to be in control of those changes so that they don't further create more divisions more unfair inequality except for but it is inevitable so what Carlotta talks about in her theory of disruptive technology is that you have
this economic institutional and technological change which just runs like a circle and keeps on moving throughout history and if we don't introduce this into the country's dialogue about all about what's happening it's not just about monetary policy is not about political is about how technology creates a new common sense how the world the world at the end of the six year cycle will not be like
the world that was existing in nineteen seventy one in Silicon Valley when Carlotta Peres went out in search of oil and found the microprocessor and the world which emerges with the next Big Bang whatever that Big Bang of disruptive technology will be will be still different and will create a form new reality a new common sense as well and we have to be open to that
because the winners of the people who get to the other side first and welcome everybody across so what does that mean and simple Julie language when I first came to this country in nineteen ninety eight a set up a network of partners club first Tuesday and everybody who came to first Tuesday events we haven't announced luster as well these were digital revolutionaries internet on spinners they
were David with a sling shot they wanted to kill and assassinate the goliaths of the day and it really worked out that way a couple of them survived in you know the big internet names but survived and so forth but I would argue that today is a very different dynamic David and Goliath need to dance remember through that the last twelve years broadband mobile technology just
continue to penetrate into our lives we are living our lives more with the benefit of technology which is don't think of it as technology and so the the digital entrepreneurs that come to my office today at Ariadne capital they're looking for a son to invest in them they don't say things like that but this great piece of disruptive technology and we're gonna kill Tesco we're gonna
takeover Barclays they say something completely different it's about a great digital application we've got a digital car we're looking for a highway any help us on the highway for digital car so consumerization of technology that's what's been going on for the past fifteen years when I started out in my career it wasn't the case technology was adopted inside the office you may have heard of the
singularity is near another book for your for your reading list basically ran Criswell says at a certain point have to leverage to fast it's taking over our lives because the rate of adoption of new technologies is emerging so quickly now this this explains my entire business you've got David David is the digital enabler he sat entrepreneur that's building the digital car allies are all the all
the different corporate the have distribution they can be tested they could be barked as they could be a train line they could be virgin active biggest thing that corporates have today is distribution audience scale reads and they need to open themselves up to digital entrepreneurs they need to put a big old sign post out there if they need to create an ability for those digital on
Skinner's to interact with their customers because no venture capitalist today is going to give fifty million sterling to do that digital David to go acquire customers here she's going to have to find that highway and if the corporates don't become the highway if they don't open themselves up and become that enterprise platform the good Amazon ago the apple begin to face the contribute one sells for
stuff comin every other American technology firm unlike their highway lots of examples of digital enablers engaging with corporates today this David and Goliath dances happening all over the market and you'll spot this everywhere you go so many you heard last August two thousand eleven mark entries in the founder of Netscape running one of those disrupted venture capital firms in the world on silicon valley he was
quoted by the Wall Street journal in an interview he said software is eating the world all businesses are re being rebuilt a software firms and I do mean and he meant all businesses every business announcing is going to be re written with software additional business models and for those of you that are out there that might be watching this it will say we have but not
my business then you're basically gonna get steam rolled over biotechnology firm a software firm that's going to take over your industry your sector your company it's happens in music it's happened in books it's happened and help as it's happening in banking it's happening is just a question of how fast you die or whether you get on to the high growth highway so given all that what's
the investment opportunity where do you go well we have a cunning plan we never forget it Ariadne capital and at entrepreneur country which is one of our for businesses %HESITATION that innovation is about economics people get confused the wrong they think it's about technology it's not remember technology in finance our service industries industry they're supporting they give leverage they give growth but they're not the main
events innovation is about economics if it were about technology we'd all be flying the Concorde were not reception jumbo jets so if there's one concept that I really want you to take away from today's talk is that there's a profound network orientation to business to all of life in fact nothing operates linearly or hierarchically today nothing is about I'm buying your selling nothing is about I'm
bigger your smaller nothing is about I'm right you're wrong to just do it and get on with it report back we are participating in a transaction we're participating in an ecosystem or participating in a club in a group in us and and so forth and as a result of understanding and taking forgiven even if you don't even if you're not sure go with it for a
week with this concept that there's a network orientation to everything and think therefore about the opportunities because I guarantee you that the people who understand this are the ones you're going to be winning ecosystems ecosystem economics is what we believe predicts the winners people whether they're in large printing companies or small mom and pop shops that people understand who who's in their ecosystem and can and
can figure out how they can drive the Senate economics to create a growing ply integrated set of shared economics in the central transaction that could be buying milk at your corner store that could be a how evokes are distributed that can be about how printing reshapes itself in the world of E. books any business operates in an ecosystem where the transaction is the micro representation to
macro ecosystem dissipating in these were not dictating we've moved to a world of carrots nonstick it's about building an ecosystem economics who will say that they organize the world's information actually they do a lot more than that Dante they organize the economics of the world's information and I am you as consumers of their search Cher in no economic or financial upside of the use of our
data at the aggregate albeit anonymously our data but they don't give us any upside whatsoever now I've argued for a long time that their greatest Achilles heel would be if somebody would offer a different ecosystem economics approach to that and give the individual user share of Vietnam vets and I looked for that on spinner I fountain his name is John paleo like these is a British
entrepreneur and he ran a business called it that quote if that quote was a financial services price comparison engine it wasn't even the biggest one wasn't money supermarket when Google came knocking looking for a company to acquire in that sector they didn't think about many supermarket they look for the guy who had the business model that threaten them to their core which was offering an economic