In this enlightening conversation, Azeem Azhar, a former VC-backed Founder and author of ‘The Exponential Age’, shares his insights on the role of visionary founders in driving market evolution.
He discusses the concept of exponential technologies, their societal impact, and the need for founders to understand and leverage these technologies to drive rapid change.
Significance of Founder Psychology and Knowledge
Startups are one of the world’s greatest leverage points, and founder psychology and knowledge are key to leveraging startups.
Founders need to understand the social contracts they are implicitly part of and the societal impact of their creations.
Visualizing Exponential Growth
Exponential growth can be challenging to understand and visualize due to its rapid escalation.
Founders need to grasp this concept and convince their teams and investors of the potential for swift change and growth in their ventures.
Winners and Losers in the Exponential Age
The internet’s transparency is leading to power laws, where a small number of people or companies dominate.
This could lead to increasing inequality and social unrest, highlighting the need for new models and principles to guide the development and use of technology.
Internet’s Role in Innovation
The internet has shortened the distance from idea to implementation, providing quick feedback on what works and what doesn’t.
This has led to a compression of time for innovation and implementation, significantly shortening the process compared to traditional academic publishing routes.
Government vs Entrepreneurs
There is a clash between the linear process of government and the exponential processes of entrepreneurs, referred to as the ‘exponential gap’.
The solution lies in raising the line of the linear process to make it more flexible and resilient.
Exponential Technologies Defined
Exponential technologies are those that improve by more than 10% per year for many decades on a price performance basis.
These include technologies like Moore’s Law, battery storage for renewables, and solar power generation, which see significant annual improvements.
Founders’ Role in Market Evolution
Visionary founders are instrumental in driving market evolution.
They go beyond solving market failures or addressing clear problems, pushing society towards the upward bend of the exponential technology curve.
This requires a deep understanding of why exponential growth occurs in some areas and not in others.
Transition from Industrial to Exponential Age
The world’s largest companies have transitioned from industrial age firms like Exxon and General Motors to exponential companies like Google, Apple, Facebook, and Amazon.
This shift signifies the dawn of the exponential age and the reorganization of society around exponential technologies.
Concept of Commons or Collectivity
Azhar proposes a new set of principles to replace the idea of shareholder value and maximization.
He suggests the idea of collectivity or commons, where more stakeholders are taken into account, not just stockholders.
These principles can be adopted through social consensus.
Technology’s Increasing Importance in Society
If something goes wrong with a major tech company today, it can have a significant impact on society, much like infrastructure.
This underscores the need for robust and resilient systems and the increasing importance of technology in society.
Interplay Between Societal Needs and Technology
Technology is part of a larger process that is already happening.
Founders bridge the gap between a technology that isn’t quite ready and market needs that aren’t well expressed, uncovering something rather than building it for the first time.
These founders need to think that way then they need to convince their teammates to think that way and believe in the idea and what’s about to happen and then they need to often convince investors so having ways and hooks of explaining how quickly something’s going to change is really important. – Azeem Azhar
Communication Problem in Tech Industry
There is a growing disenchantment with tech companies, particularly in the West, due to a communication problem and a lack of broad participation in discussions about technology.
There’s a need to level up people outside of the tech industry so they can participate more effectively in these discussions.
When I talk about an exponential technology, I think about one that improves on a price performance basis by more than 10% per year for many, many decades. – Azeem Azhar
