Peter H. Diamandis, Steven Kotler: Bold

Bold, how to go big, create wealth and impact the world

Right now, there is another asteroid striking out world, already extinguishing the large and lumbering, already clearing a giant path for the quick and nimble. Our name for this asteroid is exponential technology, and even if this name is unfamiliar, its impact is not.

Thousands of years ago, it was only kings, pharaohs, and emperors who had the ability to solve large-scale problems. Hundreds of years ago, this power expanded to the industrialist who built our transportation systems and financial institutions. But today, the ability to solve such problems has been thoroughly democratized.

Book is a go to resource on accelerating technologies, thinking at scale, and utilizing crowd-powered tools.

Bold technology

Goodbye, linear thinking … hello, exponential

In 1892, the Eastman Kodak company was born. In 1996, Kodak head 140,000 employees and a $28 billion market cap. Kodak was in the business of recording memories. They buried the technology they developed before any competition in digital photography. They developed this technology in 1976.

Exponential growth is a compound doubling. Underestimating the power of exponentials is easy to do. We hominids evolved in a world that was local and linear.

I have developed a framework called the six Ds of exponentials: digitalization, deception, disruption, demonetization, dematerialization, and democratization.

Digitalization. Innovation occurs as humans share and exchange ideas. Everything that could be digitized could spread at the speed of light. Anything that becomes digitized hops on Moore’s law of increasing computational power.
Deception. What follows digitalization is deception, the period during which exponential growth goes mostly unnoticed.
Disruption. In simple terms, a disruptive technology is any innovation that creates a new market and disrupts an existing one.
Demonetization. Dismiss the removal of money from the equation. Chris Anderson argues that in today’s economy one of the easiest ways to make money is to give stuff away.
Dematerialization. What demonetization describes the vanishing of the money once paid for goods and services, dematerialization is about the vanishing of the goods and services themselves.
Democratization. Obviously, this chain of vanishing returns has to end somewhere. Democratization is what happens when those hard costs drop so low they becomes available and affordable to just about everyone.

Democratization is the end of our exponential chain reaction, the logical result of demonetization and dematerialization. It is what happens when physical objects are turned into bits and then hosted on a digital platform in such high volumes that their price approaches zero.

Today the final three Ds in our chain reaction can disassemble companies and disrupt industries almost overnight.

For linear-thinking companies, the six Ds off exponentials are the six horsemen of the apocalypse.

In his book exponential organizations former head of innovation at Yahoo Salim Ismail defines an exponential organization as one whose impact (or output) – because of its use of networks or automation or/and it’s leveraging of the crowd – is disproportionately large compared to its number of employees.

Welcome to the new Kodak moment – the moment when an exponential force puts a linear company out of business.

Standing in the way of invention is financing, engineering, distribution, and legalities.

Quirky, Airbnb, and Uber are great examples of entrepreneurs taking advantage of the expanding scale of exponential impact.

In times of dramatic change, the large and slow cannot compete with the small and nimble.

Exponential technology, the democratization of the power to change the world

In his book The Prime Movers, Edwin Locke identifies the core mental traits of great business leader. It was vision.

The Gartner hype cycle talks about that after a novel technology is introduced and begins gaining momentum, we tend to envision it in its final form – seriously over inflating our expectations for both its development timetable and its short-term potential.

Recognizing when a technology is exiting the trough of disillusionment and beginning to rise up the slope of enlightenment is critical for entrepreneurs.

Stone chipping was the birth of tool use, but it was also the birth of subtractive manufacturing, the brothers of object creation wherein a larger block of material is subtracted from until all that remains is a large pile of debris and a desired object.

Until recently, subtractive manufacturing was essentially how object creation got done. Charles Hull changed this game. Edit two manufacturing in which objects are built up one layer at a time was born. This was the birth of a 3D printing. Hull constructed the first 3D printer in 1984.

We are moving to a world of one-stop manufacturing. Will either have these tools in our homes and offices or we’ll rent them via the cloud.

Five to change the world

A network is any interconnection of signals and information – the human brain and the Internet being the two most prominent examples.

A sensor is a device that detects information, and when hooked up to the network, can also transmit that information.

Technology is transforming a world that was once passive and dumb into one that is active and smart.

Eighty new things are being connected to the Internet every second.

Automation – process of gathering all the data collected by the IoT, turning it into a series of next actions, and then, without human intervention, executing those actions.

Any discussion of networks and sensors leads directly to a discussion about how we’re going to extract value from all this data. Welcome to the radical world of infinite computing. Infinite computing is the term Bass uses to describe the ongoing progression of computing from a scarce and expensive resource toward one that is plentiful and free.

Every year we produce more computing power than the sum of all prior years. The cloud is democratizing our ability to leverage computing on a massive scale.

Infinite computing demonetizes error-making, thus democratizing experimentation.

Today, in America, 80 percent of jobs revolve around the service industry, which in turn can be broken down into four fundamental skills: looking, reading, writing, and integrating knowledge. Computer can now perform all four of these skills and in many cases, better than humans.

Robotics is the fastest growing industry in the world, poised to become the largest in the next decade. Robots don’t unionize, don’t show up late, and don’t take lunch.

Synthetic biology is built around the idea that DNA is essentially software – nothing more than a four-letter code arranged in a specific order. As with all software, DNA can be reprogrammed. Synthetic biology is essentially genetic engineering gone digital.

Bold mindset

Climbing Mount Bold

When it comes to fostering bold innovation, why is it better to be pirate?

Exponential alone won’t get this job done. Climbing Mount Bold is not just technologically difficult, it’s also incredibly psychologically difficult.

Big goals help focus attention, and they make us more persistent. Big goals work best when there’s an alignment between an individual’s values and the desired outcome of the goal.

Reid Hoffman: “If you’re not embarrassed by the first version of your product, you’ve launched too late.”[1]

ASP is better motivation than money alone. Autonomy, mastery, and purpose. Autonomy is the desire to steer our own ship. Mastery is the desire to steer it well. And purpose is the need for the journey to mean something.

If you sign up for moonshot thinking, if you sign up to make something 10x better, there is no chance of doing that with existing assumptions.

Google has eight innovation principles:

Focus on the user.
Share everything.
Look for ideas everywhere.
Think big but start small.
Never fail to fail.
Spark with imagination, fuel with data.
Be a platform.
Have a mission that matters.

There are 17 flow triggers in total: 3 environmental, 3 psychological, 10 social, and 1 creative according to The Flow Genome Project.

Environmental: high consequences (taking calculated risks), rich environment (combination of novelty, unpredictability, and complexity), deep embodiment (total physical awareness).
Psychological (inner environment): clear goals (clarity gives certainty), immediate feedback (how to be better), the challenge/skills ratio (stretch not break).
Social (group flow): serious concentration, clear goal, good communication; equal participation, element of risk; familiarity (common language and shared knowledge of group); blending egos (collective humility), sense of control (autonomy and mastery); close listening (engaged here and now); always say “yes, and …” (additive not argumentative interaction).
Creative: pattern recognition and risk-taking (link new ideas together and bring them into the world).

The Secrets of Going Big

The search for new resources has always been the main reason for attempting the difficult and dangerous.

In each of our minds we have a line of credibility. When you first hear a new idea, you place it above or below this line. But we also have a line of super-credibility. When a new idea is born above this line, you accepted it immediately, and say, “Wow, that’s fantastic! How can I get involved?”

Having smartest folks on the planet pound on your vision can help turn dank call into glittering diamonds.

Break your vision into executable, bite-size chunks. Subgoals bring dual benefits. The first is the alignment of risk with reward. The second benefits is psychological. Gary Latham explains this by saying: “Big goals only increase motivation when the person setting those goals is confident in their ability to achieve them.

People love passion. People love to contribute to passion. And you can’t fake it. The human bullshit detector is great at spotting the inauthentic article.

Important to write down your own laws. You’re essentially creating an external hard drive for when your internal hard drive is guaranteed to crash.

The best way to predict the future is to create it yourself!
When faced without a challenge – make one!
No simply means begin one level higher!
If anything can go wrong, fix it! (To hell with Murphy)
when given a choice – take both!
The ratio of something to nothing is infinite!
An expert is someone who can tell you exactly how something can be done.
Start at the top, then work your way up.
If you can’t win, change the rules.
If you can’t change the rules, then ignore them.
The faster you move, the slower time passes, the longer you live.
The day before something is a breakthrough, it’s a crazy idea.
The world’s most precious resource is the persistent and passionate human mind.

Billionaire Wisdom, thinking at scale

Elon Musk, Richard Branson, Jeff Bezos, and Larry Page. All four exemplify the central idea in this book, exhibiting a commitment to bold that’s fierce, enduring, and masterfully executed.

Humans don’t grok scale. Our brains evolved to process simpler world, where everything we encountered was local and linear.

Here is the list of psychological tools to help us think scale:

Risk taking and risk mitigation.
Rapid iteration and ceaseless experimentation.
Passion and purpose.
Long-term thinking.
Customer-centric thinking.
Probabilistic thinking.
Rationally optimistic thinking.
Reliance on first principles, aka fundamental truths.

Passion and purpose scale – always have, always will. Every movement, every revolution, is proof of this fact.

It should be pointed out that first principle thinking works so well because it gives us a proven strategy for editing our complexity, while also allowing entrepreneurs to sidestep the tide of popular opinion.

Two biases that are the biggest obstacles in scale thinking are narrow framing and loss aversion. Musk consistently strives to broaden his view by thinking in probabilities.

Even if the probability for success is fairly low, if the objective is really important, it’s still worth doing.

If Branson thinks a particular service might be beneficial to his customers, he tries it out.

Bezos’s success sits atop two critical strategies: long-term thinking and customer-centric thinking.

Larry’s page favorite questions were: why not and why not bigger. He’s someone unaccustomed to limits. The PageRank algorithm democratized access to information. Speed is of the essence for Page, which is why he backs up his rationally optimistic view of the future with an extraordinary healthy appetite for risky, bold innovation. There’s always more to do, and his focus is on where the next 10x will come from.

The Bold Crowd

Crowdsourcing

It was Jeff Howe, alongside Wired editor Mark Robinson, who noticed what was happening with the likes of Threadless and Second Life and coined the term crowdsourcing. Howe defined the word as “the act of a company or institution taking a function once performed by employees and outsourcing it to an undefined (and generally large) network of people in the form of an open call.

Both crowdfunding and crowdsourcing diversified quickly, with all sorts of commercial applications beginning to emerge.

Crowd-powered capabilities are now available toe everyone. These tools are exponential in power for three simple reasons:

Over the next decade, the size of the crowd is expected to more than double.
The communication technologies underpinning the crowd are growing exponentially.
All of the exponential technologies are starting to become easily accessible to the masses, further empowering hyperconnected, hyperresponsive crowd.

Today, the ability to play at scale is never more than a few mouse click away.

How to crowdsource:

Crowdsourcing tasks. Tasks are work. Crowdsourcing tasks means getting someone somewhere to do the work for you. One of the most important questions to answer when approaching crowdsourcing is whether the work can be broken down into smaller, simpler units. Aggregation and classification jobs tend to be popular uses. Macrotasks are jobs that: can’t be broken down, can be done independently, require some type of specific skillset or thought process, are additive and dependent on already completed work for the task, and take a discrete, fixed amount of time to complete.
Crowdsourced creative/operational assets. The asset is anything that provides value to you and your business. Creative assets include a wide variety of design-based assets. Operational assets, meanwhile, are those things required for business to run effectively.
Crowdsourced testing and discovery insight. When it come to crowdsourcing insights, there are two main variants: testing and discovery. Testing-based insight often come from examining existing assumptions and current best practices. In discovery-based insight you can ask the crowd for their interpretation of a particular problem or question.

Crowdsourcing best practices: do your research; just get busy; turn to the message boards; establish context and be specific; prepare your data set; qualify your workers; define clear, simple and specific roles; communicate clearly, in detail, and often; don’t micromanage, have an open mind for new ways of thinking, pay to play – that is, go for quality first, then price; prepare for the flood; be open to new working methodologies.

Crowdfunding

Each year, at any given time, there are roughly 27 million US businesses in need of capital. Historically, our access to capital has been limited by our access to people.

Crowdfunding is the exponential crowd tool that lets you tap this new resource, allowing you to mine the world for like-minded individuals and fast-track passion projects like never before.

Four main types of crowdfunding:

Donation
Debt
Equity
Reward and incentive

The best crowdfunding campaigns have five key characteristics in common:

The product is usually in late prototype phases.
The team is correctly assembled and capable of executing.
The product is community focused and consumer facing.
The team has access to a large community of followers.
The product aims to solve a problem, improve an existing product, and/or tell a new story.

Crowdfunding is all about incentives. The success of the campaign is wholly dependent on creating early excitement and offering urgent, exclusive, and value-added incentives.

Crowdfunding is not where you make a profit on your project. It’s where you offset some of your expenses.

Pretty much anyone in Silicon Valley these days will tell you that building a great team is the most important step in building a great product or company. There are seven key team roles – five are mandatory, two are optional.

The Celebrity (the Face).
Campaign Manager and Strategist.
The Expert.
Graphic Design Lead,
Technology Manager.
Public Relations Manager (optional).
Supper-Connector (optional).

Tips for telling a meaningful story:

Make it cohesive.
Fill a need or desire.
Focus on the why, not the what.
Connect with your vertical.
Use the right words. Think about categories like: reciprocity, scarcity or attachment, social proof, social identity, authority and liking.

The three As of your audience: affiliates, advocates and activists.

How do you announce your campaign is critically important. Timing is everything in crowdfunding: market timing and launch timing. Campaigns are not static. This isn’t launch and forget, it’s launch and get busy. Making data-driven decisions throughout the campaign can dramatically improve your chances of success.

Segment the audience, ask only one question, expect exaggeration.

Building communities

Community is different than the crowd. The crowd is everyone online. A community is pulled from the crowd. It’s everyone with whom you have a working relationship. We have DIY communities and exponential communities. A DIY community is a group of people united around a massively transformative purpose (MTP). An exponential community, meanwhile, is a group of people who are immensely passionate about a particular exponential technology.

The driving force behind all of these novel collaborative structures, self-organizing or otherwise, is an entirely new kind of value proposition, what technology expert and author Joshua Klein calls reputation economics.

The ego-belittling truth the Internet makes visible is that none of us is as unique as we’d like to believe. If you don’t have first-mover advantage, then ask yourself what new and exciting twist you are bringing to the table.

Stages of community building:

Identity – what is your MTP?
Designing your community portal.
Community-building resources.
Early days of building your community.
Creating community content.
Engagement and engagement strategies.
Managing your community.
Driving growth.
Monetization.

There are six basics regarding designing the look, feel, and engagement of your community portal:

Just get started – design something authentic.
Navigation.
Simple registration.
The information.
Recognition.
Scalability.

The bigger a community gets; the less people participate.

Seven effective strategies for expansion:

Evangelism.
Play well with others.
Competition.
Pick a fight.
Buzz marketing.
Host events.
Technical optimization.

Rules of monetization:

Transparency and authenticity.
Sell what the community builds.
Cater to the core.
All the typical stuff.

Incentive competitions

One of the most powerful mechanisms available to the exponential entrepreneurs for solving big and bold global challenges is the incentive competition. Incentive competitions are brutally objective. They measure only one thing. Did you demonstrate the target goal of the competition?

Margaret Mead once said: “Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.”[2]

A well-designed incentive competition provides teams with a ‘whole is bigger than the sum of the parts’ mindset. This happens because the right motivations lead to increased cooperation, which leads to unpredictable network effects.

Benefits of incentive challenges: