Featured excerpt from WTF? What’s the Future and Why It’s Up to Us by Tim O’Reilly
If you’re an entrepreneur or aspiring to become one, Tim O’Reilly is the kind of mentor you should try to enlist. He’s been there and done that in the New Economy since, well, pretty much since there’s been a New Economy.
O’Reilly started writing technical manuals in the late 1970s, and by the early 1980s, he was publishing them, too. His company, O’Reilly Media Inc. (formerly O’Reilly R. Associates), based in Sebastopol, California, helped pioneer online publishing, and in the early 1990s, it launched the first web portal, Global Network Navigator, which AOL acquired in 1995.
Since then, O’Reilly has been an active participant in a host of developments from open source to Gov 2.0 to the maker movement. He is founding partner of San Francisco-based O’Reilly AlphaTech Ventures LLC, an early stage venture investor, and he sits on a number of boards, including Code for America Labs Inc., PeerJ, Civis Analytics Inc., and Popvox Inc. He has also garnered a huge Twitter following @timoreilly.
In his new book, WTF?, O’Reilly takes issue with the vogue for disruption. “The point of a disruptive technology is not the market or competitors that it destroys. It is the new markets and the new possibilities that it creates,” he writes. “I spend a lot of time urging Silicon Valley entrepreneurs to forget about disruption, and instead to work on stuff that matters.” In the following excerpt, edited for space, O’Reilly shares “four litmus tests” for figuring out what that means to you.
1. Work on something that matters to you more than money.
Remember that financial success is not the only goal or the only measure of achievement. It’s easy to get caught up in the heady buzz of making money. You should regard money as fuel for what you really want to do, not as a goal in and of itself.
Whatever you do, think about what you really value. If you’re an entrepreneur, the time you spend thinking about your values will help you build a better company. If you’re going to work for someone else, the time you spend understanding your values will help you find the right kind of company or institution to work for, and when you find it, to do a better job.
Don’t be afraid to think big. Business author Jim Collins said that great companies have “big hairy audacious goals.” Google’s motto, “access to all the world’s information,” is an example of such a goal.
There’s a wonderful poem by Rainer Maria Rilke that retells the biblical story of Jacob wrestling with an angel, being defeated, but coming away stronger from the fight. It ends with an exhortation that goes something like this: “What we fight with is so small, and when we win, it makes us small. What we want is to be defeated, decisively, by successively greater beings.”
The most successful companies treat success as a by-product of achieving their real goal, which is always something bigger and more important than they are. Former Google executive Jeff Huber is chasing this kind of bold dream of using technology to make transformative advances in health care. Jeff ’s wife died unexpectedly of an aggressive undetected cancer. After doing everything possible to save her and failing, he committed himself to making sure that no one else has that same experience. He has raised more than $100 million from investors in the quest to develop an early-detection blood test for cancer. That is the right way to use capital markets. Enriching investors, if it happens, will be a by-product of what he does, not his goal. He is harnessing all the power of money and technology to do something that today is impossible. The name of his company — Grail — is a conscious testament to the difficulty of the task. Jeff is wrestling with the angel.
2. Create more value than you capture.
It’s pretty easy to see that a financial fraud like Bernie Madoff wasn’t following this rule, and neither were the titans of Wall Street who ended up giving out billions of dollars in bonuses to themselves while wrecking the world economy. But most businesses that prosper do create value for their community and their customers as well as themselves, and the most successful businesses do so in part by creating a self-reinforcing value loop with and for others. They build or are part of a platform on which people who don’t work directly for them can build their own dreams.
Investors as well as entrepreneurs must be focused on creating more value than they capture. A bank that loans money to a small business sees that business grow, perhaps borrow more money, hire employees who make deposits and take out loans, and so on. An investor who bets on the future of an unproven technology can do the same. The power of this cycle to lift people out of poverty has been demonstrated for centuries.
If you’re succeeding at the goal of creating more value than you capture, you may sometimes find that others have made more of your ideas than you have yourself. It’s OK. I’ve had more than one billionaire (and an awful lot of start-ups who hope to follow in their footsteps) tell me how they got their start with a couple of O’Reilly books. I’ve had entrepreneurs tell me that they got the idea for their company from something I’ve said or written. That’s a good thing.
Look around you: How many people do you employ in fulfilling jobs? How many customers use your products to make their own living? How many competitors have you enabled? How many people have you touched who gave you nothing back?
3. Take the long view.
The musician Brian Eno tells a story about the experience that led him to conceive of the ideas that led to the Long Now Foundation, a group that works to encourage long-term thinking. In 1978, Brian was invited to a rich acquaintance’s housewarming party, and as the neighborhood his cab drove through became dingier and dingier, he began to wonder if he was in the right place. “Finally [the driver] stopped at the doorway of a gloomy, unwelcoming industrial building,” he wrote. “Two winos were crumpled on the steps, oblivious. There was no other sign of life in the whole street.”
But he was at the right address, and when he stepped out on the top floor, he discovered a multimillion-dollar palace.
“I just didn’t understand,” he said. “Why would anyone spend so much money building a place like that in a neighborhood like this? Later I got into conversation with the hostess. ‘Do you like it here?’ I asked. ‘It’s the best place I’ve ever lived,’ she replied. ‘But I mean, you know, is it an interesting neighborhood?’ ‘Oh — the neighborhood? Well ... that’s outside!’ she laughed.”
In the talk many years ago where I first heard him tell this story, Brian went on to describe the friend’s apartment, the space she controlled, as “the small here,” and the space outside, full of winos and derelicts, as “the big here.” He went on from there, along with others, to come up with the analogous concept of the Long Now. We need to think about the long now and the big here, or one day our society will enjoy neither.
It’s very easy to make local optimizations, but they eventually catch up with you. Our economy has many elements of a Ponzi scheme. We borrow from other countries to finance our consumption, and we borrow from our children by saddling them with debt, using up nonrenewable resources, and failing to confront great challenges in income inequality, climate change, and global health.
Every new company trying to invent the future has to think long-term. What happens to the suppliers whose profit margins are squeezed by Walmart or Amazon? Are the lower margins offset by higher sales or do the suppliers faced with lower margins eventually go out of business or lack the resources to come up with innovative new products? What happens to driver income when Uber or Lyft cuts prices for consumers in an attempt to displace competitors? Who will buy the products of companies that no longer pay workers to create them?
It’s essential to get beyond the idea that the only goal of business is to make money for its shareholders. I’m a strong believer in the social value of business done right. We should aim to build an economy in which the important things are a natural outcome of the way we do business, paid for in self-sustaining ways rather than as charities to be funded out of the goodness of our hearts.
Whether we work explicitly on causes and the public good, or work to improve our society by building a business, it’s important to think about the big picture, and what matters not just to us, but to building a sustainable economy in a sustainable world.
4. Aspire to be better tomorrow than you are today.
I’ve always loved the judgment of Kurt Vonnegut’s novel Mother Night: “We are what we pretend to be, so we must be careful about what we pretend to be.” This novel about the postwar trial of a Nazi propaganda minister who was secretly a double agent for the Allies should serve as a warning to those (politicians, pundits, and business leaders alike) who appeal to people’s worst instincts but console themselves with the thought that the manipulation is for a good cause.
But I’ve always thought that the converse of Vonnegut’s admonition is also true: Pretending to be better than we are can be a way of setting the bar higher, not just for ourselves but for those around us.
People have a deep hunger for idealism. The best entrepreneurs have the courage that comes from aspiration, and everyone around them responds to it. Idealism doesn’t mean following unrealistic dreams. It means appealing to what Abraham Lincoln so famously called “the better angels of our nature.”
That has always been a key component of the American dream: We are living up to an ideal. The world has looked to us for leadership not just because of our material wealth and technological prowess, but because we have painted a picture of what we are striving to become.
If we are to lead the world into a better future, we must first dream of it.
View at the original source
O’Reilly started writing technical manuals in the late 1970s, and by the early 1980s, he was publishing them, too. His company, O’Reilly Media Inc. (formerly O’Reilly R. Associates), based in Sebastopol, California, helped pioneer online publishing, and in the early 1990s, it launched the first web portal, Global Network Navigator, which AOL acquired in 1995.
Since then, O’Reilly has been an active participant in a host of developments from open source to Gov 2.0 to the maker movement. He is founding partner of San Francisco-based O’Reilly AlphaTech Ventures LLC, an early stage venture investor, and he sits on a number of boards, including Code for America Labs Inc., PeerJ, Civis Analytics Inc., and Popvox Inc. He has also garnered a huge Twitter following @timoreilly.
In his new book, WTF?, O’Reilly takes issue with the vogue for disruption. “The point of a disruptive technology is not the market or competitors that it destroys. It is the new markets and the new possibilities that it creates,” he writes. “I spend a lot of time urging Silicon Valley entrepreneurs to forget about disruption, and instead to work on stuff that matters.” In the following excerpt, edited for space, O’Reilly shares “four litmus tests” for figuring out what that means to you.
1. Work on something that matters to you more than money.
Remember that financial success is not the only goal or the only measure of achievement. It’s easy to get caught up in the heady buzz of making money. You should regard money as fuel for what you really want to do, not as a goal in and of itself.
Whatever you do, think about what you really value. If you’re an entrepreneur, the time you spend thinking about your values will help you build a better company. If you’re going to work for someone else, the time you spend understanding your values will help you find the right kind of company or institution to work for, and when you find it, to do a better job.
Don’t be afraid to think big. Business author Jim Collins said that great companies have “big hairy audacious goals.” Google’s motto, “access to all the world’s information,” is an example of such a goal.
There’s a wonderful poem by Rainer Maria Rilke that retells the biblical story of Jacob wrestling with an angel, being defeated, but coming away stronger from the fight. It ends with an exhortation that goes something like this: “What we fight with is so small, and when we win, it makes us small. What we want is to be defeated, decisively, by successively greater beings.”
The most successful companies treat success as a by-product of achieving their real goal, which is always something bigger and more important than they are. Former Google executive Jeff Huber is chasing this kind of bold dream of using technology to make transformative advances in health care. Jeff ’s wife died unexpectedly of an aggressive undetected cancer. After doing everything possible to save her and failing, he committed himself to making sure that no one else has that same experience. He has raised more than $100 million from investors in the quest to develop an early-detection blood test for cancer. That is the right way to use capital markets. Enriching investors, if it happens, will be a by-product of what he does, not his goal. He is harnessing all the power of money and technology to do something that today is impossible. The name of his company — Grail — is a conscious testament to the difficulty of the task. Jeff is wrestling with the angel.
2. Create more value than you capture.
It’s pretty easy to see that a financial fraud like Bernie Madoff wasn’t following this rule, and neither were the titans of Wall Street who ended up giving out billions of dollars in bonuses to themselves while wrecking the world economy. But most businesses that prosper do create value for their community and their customers as well as themselves, and the most successful businesses do so in part by creating a self-reinforcing value loop with and for others. They build or are part of a platform on which people who don’t work directly for them can build their own dreams.
Investors as well as entrepreneurs must be focused on creating more value than they capture. A bank that loans money to a small business sees that business grow, perhaps borrow more money, hire employees who make deposits and take out loans, and so on. An investor who bets on the future of an unproven technology can do the same. The power of this cycle to lift people out of poverty has been demonstrated for centuries.
If you’re succeeding at the goal of creating more value than you capture, you may sometimes find that others have made more of your ideas than you have yourself. It’s OK. I’ve had more than one billionaire (and an awful lot of start-ups who hope to follow in their footsteps) tell me how they got their start with a couple of O’Reilly books. I’ve had entrepreneurs tell me that they got the idea for their company from something I’ve said or written. That’s a good thing.
Look around you: How many people do you employ in fulfilling jobs? How many customers use your products to make their own living? How many competitors have you enabled? How many people have you touched who gave you nothing back?
3. Take the long view.
The musician Brian Eno tells a story about the experience that led him to conceive of the ideas that led to the Long Now Foundation, a group that works to encourage long-term thinking. In 1978, Brian was invited to a rich acquaintance’s housewarming party, and as the neighborhood his cab drove through became dingier and dingier, he began to wonder if he was in the right place. “Finally [the driver] stopped at the doorway of a gloomy, unwelcoming industrial building,” he wrote. “Two winos were crumpled on the steps, oblivious. There was no other sign of life in the whole street.”
But he was at the right address, and when he stepped out on the top floor, he discovered a multimillion-dollar palace.
“I just didn’t understand,” he said. “Why would anyone spend so much money building a place like that in a neighborhood like this? Later I got into conversation with the hostess. ‘Do you like it here?’ I asked. ‘It’s the best place I’ve ever lived,’ she replied. ‘But I mean, you know, is it an interesting neighborhood?’ ‘Oh — the neighborhood? Well ... that’s outside!’ she laughed.”
In the talk many years ago where I first heard him tell this story, Brian went on to describe the friend’s apartment, the space she controlled, as “the small here,” and the space outside, full of winos and derelicts, as “the big here.” He went on from there, along with others, to come up with the analogous concept of the Long Now. We need to think about the long now and the big here, or one day our society will enjoy neither.
It’s very easy to make local optimizations, but they eventually catch up with you. Our economy has many elements of a Ponzi scheme. We borrow from other countries to finance our consumption, and we borrow from our children by saddling them with debt, using up nonrenewable resources, and failing to confront great challenges in income inequality, climate change, and global health.
Every new company trying to invent the future has to think long-term. What happens to the suppliers whose profit margins are squeezed by Walmart or Amazon? Are the lower margins offset by higher sales or do the suppliers faced with lower margins eventually go out of business or lack the resources to come up with innovative new products? What happens to driver income when Uber or Lyft cuts prices for consumers in an attempt to displace competitors? Who will buy the products of companies that no longer pay workers to create them?
It’s essential to get beyond the idea that the only goal of business is to make money for its shareholders. I’m a strong believer in the social value of business done right. We should aim to build an economy in which the important things are a natural outcome of the way we do business, paid for in self-sustaining ways rather than as charities to be funded out of the goodness of our hearts.
Whether we work explicitly on causes and the public good, or work to improve our society by building a business, it’s important to think about the big picture, and what matters not just to us, but to building a sustainable economy in a sustainable world.
4. Aspire to be better tomorrow than you are today.
I’ve always loved the judgment of Kurt Vonnegut’s novel Mother Night: “We are what we pretend to be, so we must be careful about what we pretend to be.” This novel about the postwar trial of a Nazi propaganda minister who was secretly a double agent for the Allies should serve as a warning to those (politicians, pundits, and business leaders alike) who appeal to people’s worst instincts but console themselves with the thought that the manipulation is for a good cause.
But I’ve always thought that the converse of Vonnegut’s admonition is also true: Pretending to be better than we are can be a way of setting the bar higher, not just for ourselves but for those around us.
People have a deep hunger for idealism. The best entrepreneurs have the courage that comes from aspiration, and everyone around them responds to it. Idealism doesn’t mean following unrealistic dreams. It means appealing to what Abraham Lincoln so famously called “the better angels of our nature.”
That has always been a key component of the American dream: We are living up to an ideal. The world has looked to us for leadership not just because of our material wealth and technological prowess, but because we have painted a picture of what we are striving to become.
If we are to lead the world into a better future, we must first dream of it.
View at the original source
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