Category Archives: Must watch or read

Banksy in NYC

Banksyny

An unusual post, as it has nothing to do with start-ups. Strangely enough, another one was related to New York City and Obama. I mention from time to time that entrepreneurs have similarities with artists when they want to have an impact. And innovation is an art, not a science.

I followed Banksy‘s work in NYC from time to time last month and spent the last week-end compiling what I could find. Feel free to have a look at the pdf, which contains his 31 October days with pictures, maps and links to other sites as well as my own Google map of its locations. You can also download the Powerpoint slideshow by clicking here. It automatically launches all audios and videos (but it might depend on the ppt version you have if any).

Banksyny-lebret-pdf
Click on picture to download pdf

And here is the map of Banksy’s journey.

Afficher Banksy sur une carte plus grande

PS: June 1st, 2014: a short video summarizing Banksy’s residence in NYC:

The book that launched the Lean Startup revolution

There is nothing really new with Steve Blank’s 5th edition of The Four Steps to the Epiphany. But first I lost my first copy (who has it?) and second I thought I should read again this bible for entrepreneurs. So why not a second look.

Four-Steps-to-the-Epiphany-5th-edition

Ten years after the 1st edition, Blank is as right as ever. His Customer Development model is a great lesson about the dangers of business plans and of product development without some validation form early customers and the Market. You can read my post from 2011, Steve Blank and Customer Development. You should, as I will not say again what I said then. I do not have much to change. Let me just say again a few key elements:

– “The good new is these customer and market milestones can be defined and measured. The bad news is achieving these milestones is an art. It’s an art embodied in the passion and vision of the individuals who work to make their vision a reality. That’s what makes startups exciting.” [Page 22 and see note (1) below]
– Start-ups are not early versions of established companies. they have nothing to do with them in fact. “Startups are temporary organizations designed to search for a scalable and repeatable business model.” As a consequence, people running start-ups (product, sales, marketing, management) need to understand the start-up culture and dynamics. “Traditional functional organizations [Sales, Marketing and Business Development] and the job titles and the job descriptions that work in a large company are worse than useless in a startup. They are dangerous and dysfunctional in the first phases of a startup.”[Appendix A, “The Death of the Departments”.]

Blank’s Four Steps to the Epiphany is not easy to read but it is a must have and a must read for any entrepreneur!

(1) In another interview Balnk explained: Over the last decade we assumed that once we found repeatable methodologies (Agile and Customer Development, Business Model Design) to build early stage ventures, entrepreneurship would become a “science,” and anyone could do it. I’m beginning to suspect this assumption may be wrong. It’s not that the tools are wrong. Where I think we have gone wrong is the belief that anyone can use these tools equally well.” In the same way that word processing has never replaced a writer, a thoughtful innovation process will not guarantee success. Blank added that ” until we truly understand how to teach creativity, their numbers are limited. Not everyone is an artist, after all.”

The Entrepreneurial State: the important role of government in innovation (part 1)

Mazzacuto’s Entrepreneurial State is I think an important book. The author claims we have been unfair with the role in innovation of government and the public sector in general, which has provided funds for most not to say all R&D (Pharma, IT, Space). I share the blame as I am a strong supporter of start-ups, venture capital, Silicon Valley being the ultimate model. And the idea that the State should just provide the basics (education, research, infrastructure) and let the private sector innovate may have been a big mistake (of mine included). I will not take the blame on the second argument as I always shared with the author the idea that tax breaks and tax evasion makes the judgment even more unfair. Finally, the private sector is very risk averse so that there is less innovation (not only venture capital but corporate R&D, compared to the past when corporate R&D labs at IBM, Bell or Xerox were big or when VCs really contributed to innovation in semiconductor, computers and biotech in the 60s and 70s)

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Let me now quote Mariana Mazzacuto following her book linearly. You can also listen to her when she gave a talk at TedX.

While innovation is not the State’s main role, illustrating its potential innovative and dynamic character – its historical ability, in some countries, to play an entrepreneurial role in society is perhaps the most effective way to defend its existence. (Page 1.)

Entrepreneurship is not (just) about start-ups, venture capital and “garage tinkerers”. It is about the willingness and ability of economic agents to take on risk and real Knightian* uncertainty, what is genuinely unknown. (Page 2.)
Note: *Knightian uncertainty relates to the “immeasurable“ risk, i.e. a risk that cannot be calculated.

Even during a boom most firms and banks (would) prefer to fund low-risk incremental innovations, waiting for the State to make its mark in more radical areas. (Page 7.) Examples are provided from the pharmaceutical industry – where the most revolutionary new drugs are produced mainly with public, not private funds. (Page 10.)

Apple must pay tax not only because it is the right thing to do, but because it is the epicenter of a company that requires the public purse to be large and risk-taking enough to continue making the investments that entrepreneurs like Jobs will later capitalize on. (Page 11) Precisely because State investments are uncertain, there is a high risk that they will fail. But when they are successful, it is naive and dangerous to allow all the rewards to be privatized. (Page 12)

Chapter 1 – (The Innovation Crisis)

The emphasis on the State as an entrepreneurial agent is not of course meant to deny the existence of private sector entrepreneurship activity, from the role of young new companies in providing the dynamism behind new sectors (e.g. Google) to the importance source of funding from private sources like venture capital. The key problem is that this is the only story that is usually told. (Page 20)

It is naive to expect venture capital to lead in the early and most risky stage of any new economic sector today** (such as clean technology). In biotechnology, nanotechnology and the Internet, venture capital arrived 15-20 years after the most important investments were made by public sector funds. (Page 23) The State has been behind most technological revolutions and periods of long-term growth. This is why an “entrepreneurial” state is needed to engage in risk taking and the creation of a new vision.
Note: ** Well maybe not in the 50s to the 70s, certainly in the last 10 years.

Big R&D labs have been closing and the R of the R&D spend has also been falling. A recent MIT study (1) claims that the current absence in the US of corporate labs like Xerox PARC (which produced the graphical user interface technology that led to both Apple’s and Windows’ operating systems) and Bell Labs – both highly co-financed by government agency budgets – is one of the reasons why the US innovation machine is under threat. (Page 24) Rodrik (2004) states that the problem is not in which types of tools (R&D, tax credits vs. subsidies) or which types of sectors to choose (steel vs. software), but how policy can foster self-discovery processes, which foster creativity and innovation – the need to foster exploration trial and error (and this is the core tenet of the “evolutionary theory of economic change” in chapter 2)
References
[1] MIT 2013. Innovation Economic Report, web.mit.edu/press/images/documents/pie-report.pdf‎
[2] Rodrik, 2004. Industrial Policy for the 21st century. CEPR Discussion Paper 4767

Chapter 2 – Technology, Innovation and Growth.

Progressive redistribution policies are fundamental, but they do not cause growth. Bringing together the lessons of Keynes and Schumpeter can make this happen. (Page 31) Solow discovered that 90 per cent of variation in economic output was not explained by capital and labor, he called the residual “technical change”. (Page 33)

An “evolutionary theory” explains this as a constant process of differentiation among firms, based on their ability to innovate. Selection does not always lead to “survival of the fittest” both due to the effects of increasing returns and also to the effects of policies. Selection dynamics in products markets and financial markets may be at odds.

Innovation is firm specific and highly uncertain. It is not the quantity of R&D, but how it is distributed throughout an economy. The old view that R&D can be modeled as a lottery where a certain amount will create a certain probability of successful innovation is criticized because in fact innovation would be an example of a true Knightian uncertainty, which cannot be modeled with a normal (or nay other) probability distribution. (Page 35 – the Black Swan again)

Systems of innovation are defined as the “network of institutions in the public and private sector whose activities and interactions initiate, import, modify and diffuse new technology”. (Equilibrium theory cannot work; rather than using incremental calculus from Newtonian physics, mathematics from biology are used, which can explicitly take into account heterogeneity, and the possibility of path dependency and multiple equilibria.) (Page 36) The perspective is neither micro nor macro, but meso. The causation between basic science, to large scale R&D, to applications to diffusing innovation is not linear, but full of feedback loops. One must be able to recognize serendipity and uncertainty that characterizes the innovation process. […] Using Japan as an example, “the contributions of the development state in Japan cannot be understood in abstraction from the growth of companies such as Toyota, Sony or Hitachi aside from the Japanese State’s public support for industry”. (Page 38)

Regional systems of innovation focus on the cultural geographical, and institutional proximity that creates and facilitate transactions between different socioeconomic actors, including local administrations, unions and family-owned companies… The State does this by rallying existing innovation networks or by facilitating the development of new ones that bring together a diverse group of stakeholders. But a rich system of innovation is not sufficient. The State must develop strategies for technological advance.

Mazzacuto finishes Chapter 2 with 6 myths about innovation I totally agree with!

Myth 1: Innovation is about R&D. “It is fundamental to identify the company-specific conditions that must be present to allow spending on R&D to positively affect growth.”

Myth 2: Small is Beautiful. “There is confusion between size and growth.” What is important is the “role of young high-growth firms. Many small firms are not high-growth. […] Most of the impact is from age.” “Targeting assistance to SMES through grants, soft loans and tax breaks will necessarily involve a high degree of waste. While this waste is a necessary gamble in the innovation process,” it should be targeted on high growth and not SMEs, i.e. support “young companies that have already demonstrated ambition”.

Myth 3: Venture Capital is Risk-Loving. “Risk capital is scarce in the seed stage; it is concentrated in areas of high-growth potential, low technological complexity and low capital intensity.” […] “The short-term bias is damaging to the scientific exploration process which requires longer-term horizon and tolerance to failure.” “Rewards to VC have been disproportional to risks taken”, but Mazzacuto also recognizes that “Venture capital has succeeded more in the US when it provided not only committed finance, but managerial expertise.” Finally “The progressive commercialization of science seems to be unproductive”.

Myth 4: Patents. “The rise in patents does not reflect a rise in innovation”. [I will not come back here on the topic, read again Against Intellectual Monopoly]

Myth 5: Europe’s problem is all about Commercialization. “If the US is better at innovation, it isn’t because university-industry links are better (they aren’t) or because US universities produce more spinouts (they don’t). It simply reflects more research being done in more institutions, which generate better technical skills in the workforce. US funding is split between research in universities and early stage technology development in firms. Europe has a weaker system of scientific research and weaker and less innovative companies.”

Myth 6: Business Requires Less Tax. “The R&D tax credit system does not hold firms accountable as whether they have conducted new innovation that would not otherwise have taken place, or simply pursued routine forms of product development.” “As Keynes emphasized, business investment is a function of the gut instinct of investors about future growth prospects.” This is impacted not by tax break, but by the quality of the science base, education, credit system and human capital. “It is important for innovation policy to resist the appeal of tax measures of different kinds”.

More will follow when I have read chapters 3 and followings. Now I need to share some of my concerns, first by quoting again:

“Entrepreneurship by the State can take on many forms. Four examples: DARPA, SBIR, the Orphan Drug Act, Nanotechnology. (…) Apple is far from the “market” example it is often used to depict. It is a company that not only received early stage finance from the government (through the SBIC program) but also “ingeniously” made use of publicly funded technology*** to create “smart” products.” (Pages 10-11)
Note: *** Internet, GPS, Touch screen, Siri.

“Many of the most innovative young companies in the US were funded not by private venture capital but by public venture capital, such as that provided by the Small Business Innovation Research (SBIR) program.” (Page 20)

My concerns are that
– research is not innovation & the transfer is where entrepreneurship occurs so that investing in research is not innovating or even being entrepreneurial. This is at least my experience in the field.
– SBIR real impact unclear
– Green and nano-tech impact also unclear
But I have not finished reading yet…

The Startup Kids – a film that any wannabe founder should watch!

Movies may become a better way to communicate about start-ups & entrepreneurship than books or blogs. It’s something Neil Rimer had told me when I published my book. It is true there has been a number of new features in fiction (The Social Network, Jobs) and non-fiction (SomethingVentured) recently without a need to mention old stuff such as Triumph of the Nerds Silicon Valley Pirates and special events on television such as PBS.

Startup Kids belong to this new trend and it is an interesting (and fun) document. You may watch the trailer here and I will quote a few entrepreneurs thereafter. The document had been mentioned to me by colleagues (merci Corine ) who showed it to me, including the very good blog article of Sébastien Flury: The Startup Kids – a film that any wannabe founder should watch! (whom title I used, nice Sébastien 🙂 )

What’s entrepreneurship?

StartupKids-Houston
Drew Houston, Dropbox: “It’s like jumping out of a cliff and having to build your own parachute”

StartupKids-Segerstrale
Kristian Segerstrale, Playfish: “An entrepreneur is a person who dares to have a dream that not many people have and even more important dares to chase it, put their money where their mouth is and their time and their career and dares to take the risk to going out there to realize that vision.”

StartupKids-Ljung
Alexandre Ljung, SoundCloud (from Sweden and based in Berlin and San Francisco): “I did not have the typical entrepreneur background, […] but in hindsight I was very focused on projects so I was very entrepreneurial but not in a business sense.”

In European Founders at Work, his co-founder Eric Wahlforss states “I think we could have easily done this in one year faster if we would have been a little bit more bold and thinking a little bit more in terms of scale early on. We started out very small, had almost no money at all, and a very small team. I think we could have been bolder. […] and running with a bigger vision from the start.” And then “Do it.” It’s the best decision I’ve ever done in my whole life. […] And I was studying engineering as well, and I had one hundred classmates. And I know that almost zero of them actually went on to start a company, which is kind of crazy because I know a lot of them have good ideas. But none of them quite felt that they were able to pull it off.

Luck is an important topic in the movie

Segerstrale
again: “Successful start-ups need a lot of things, they need a great idea, they need a great team, they need to be there at the right time, they need the right level of funding, and they need a lot of luck.”

StartupKids-Draper
Tim Draper, founder and investor, DFJ: “There is a lot of luck in the success of all the companies which have succeeded. You need a lot of luck, there were 25 search engines funded before Google was funded. There was Friendster and LinkedIn and MySpace and about 50 others before facebook became the big winner in that area.” [And it was the same with computer companies in the 80s!]

StartupKids-Klein
Finally do not miss Zach Klein (founder of Vimeo) in his beautiful wood cabin which reminds me of Thoreau’s Walden.

When Science Looks Like Religion: The theory That Would Not Die.

It is the third book I read about statistics in a short while and it is probably the strangest. After my dear Taleb and his Black Swan, after the more classical Naked Statistics, here is the history of the Bayesian statistics.

mcgrayne_comp2.indd

If you do not know about Bayes, let me just add that I like the beautiful and symmetric formula: [According to wikipedia]
For proposition A and evidence B,
P(A|B) P(B) = P(B|A) P(A)
P(A), the prior, is the initial degree of belief in A.
P(A|B), the posterior, is the degree of belief having accounted for B.
the quotient P(B|A)/P(B) represents the support B provides for A.
Another way of explaining it mathematically is Bayes’ theorem gives the relationship between the probabilities of A and B, P(A) and P(B), and the conditional probabilities of A given B and B given A, P(A|B) and P(B|A).

I was never really comfortable with its applications. I was probably wrong again, given all what I learnt after reading Sharon Bertsch McGrayne’s rich book. But I also understood why I was never comfortable: for three centuries, there’s been a quasi-religious war between Bayesians and Frequentists on how to use probabilities. Are these linked to big, frequent numbers only or can they be applied for rare events? What is the probability of a rare event which may never occur or maybe just once?

[Let me give you a personal example: I am interested in serial entrepreneurship, and did and still do tons of statistics on Stanford-related companies. I have more than 5’000 entrepreneurs, and more than 1’000 are serial. I have results showing that serial entrepeneurs are not on average better than one-time, using frequency and classical methods. But now I should think about using:
P(Success|Serial) = P(Serial|Sucess) P(Success) / P(Serial)
I am not sure what will come out, but I should try!].

If you want a good summary of the book, read the review by Andrew I. Daleby (pdf). McGrayne illustrates the “recent” history of statistics and probabilities through famous (Laplace) and less famous (Bayes) scientists, through famous (the Enigma machine and Alan Turing) and less famous (lost nuclear bombs) stories and it is a fascinating book. I am not convinced it is great at explaining the science, but the story telling is great. Indeed, it may not be about science at all. But about belief as is mentioned in the book: Swinburne inserted personal opinions into both the prior hunch and the supposedly objective data of Bayes’ theorem to conclude that God was more than 50% likely to exist; later Swinburne would figure the probability of Jesus’ resurrection at “something like 97 percent” [Page 177]. It obviously reminded me of Einstein’s famous quote: “God does not play dice with the universe.” This is not directly related but for the second time in my life, I was reading about links between science, probability and religion.

Love, America, Technology, and Art

What have these 4 things in common? I am not sure. But in the last 12 hours, I had to put this 4 things together. My professional life is about technology, but I am not a technophile. I do not have a smart phone. But I like people and I strangely rediscovered it through high-tech entrepreneurship. There are many, many more important things. I will give you two examples with Bruce Springsteen and Jonathan Franzen, two known supporters of Barack Obama, whom I have mentioned a couple of times here. These are just two (therefore three) examples of why it is possible to like America… follow me, you don’t have to agree.

(Let me just add 5 minutes after publishing this article that we are on July 4!)

Springsteen-geneve

Yesterday, I was in Geneva for one of the best concerts of my life. The Boss and his sixteen musicians gave a nearly 3 hour-long show with a generosity I had never seen on stage. I did not know about his “sign requests”. His fans showed him signs with song titles and he picked a few, which he would later sing. Not the kind of music machines I am often used to experience. A kid went on stage and sang alone for a while. This was unique too. He is 63-year old and has the energy of a youngster, the generosity of a wise man. No naiveness. “We have a job to make here tonight.” What a job! I found a site which gave a short account including the songs he chose yesterday (including the signed ones – see in the end). Springsteen belongs to the group of people which show why we can love America.

I also like Jonathan Franzen. I may have read all his writings, The Corrections remains my favorite one. I am currently reading his latest essays. He also shows suffering, misery, hardship in America. A different kind of suffering, but in the end, it is probably the same. Americas is great when it shows its weaknesses. But neither Sprinsteen nor Franzen are depressing, because they are generous, they are passionate. I don’t see any cynism. Hopefully, I am not naive. In one of his latest essays, a commencement address at Kenyon College, he links technology and love… The title is PAIN WON’T KILL YOU and in the NYT he made another version entitled Liking Is for Cowards. Go for What Hurts.

franzen-time

Here is the NYT full version. I think it is worth reading it. But you can use the two previous web links too. I will try to provide my French version later…
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Liking Is for Cowards. Go for What Hurts.
By JONATHAN FRANZEN
Published: May 28, 2011

A COUPLE of weeks ago, I replaced my three-year-old BlackBerry Pearl with a much more powerful BlackBerry Bold. Needless to say, I was impressed with how far the technology had advanced in three years. Even when I didn’t have anybody to call or text or e-mail, I wanted to keep fondling my new Bold and experiencing the marvelous clarity of its screen, the silky action of its track pad, the shocking speed of its responses, the beguiling elegance of its graphics.
I was, in short, infatuated with my new device. I’d been similarly infatuated with my old device, of course; but over the years the bloom had faded from our relationship. I’d developed trust issues with my Pearl, accountability issues, compatibility issues and even, toward the end, some doubts about my Pearl’s very sanity, until I’d finally had to admit to myself that I’d outgrown the relationship.
Do I need to point out that — absent some wild, anthropomorphizing projection in which my old BlackBerry felt sad about the waning of my love for it — our relationship was entirely one-sided? Let me point it out anyway.
Let me further point out how ubiquitously the word “sexy” is used to describe late-model gadgets; and how the extremely cool things that we can do now with these gadgets — like impelling them to action with voice commands, or doing that spreading-the-fingers iPhone thing that makes images get bigger — would have looked, to people a hundred years ago, like a magician’s incantations, a magician’s hand gestures; and how, when we want to describe an erotic relationship that’s working perfectly, we speak, indeed, of magic.
Let me toss out the idea that, as our markets discover and respond to what consumers most want, our technology has become extremely adept at creating products that correspond to our fantasy ideal of an erotic relationship, in which the beloved object asks for nothing and gives everything, instantly, and makes us feel all powerful, and doesn’t throw terrible scenes when it’s replaced by an even sexier object and is consigned to a drawer.
To speak more generally, the ultimate goal of technology, the telos of techne, is to replace a natural world that’s indifferent to our wishes — a world of hurricanes and hardships and breakable hearts, a world of resistance — with a world so responsive to our wishes as to be, effectively, a mere extension of the self.
Let me suggest, finally, that the world of techno-consumerism is therefore troubled by real love, and that it has no choice but to trouble love in turn.
Its first line of defense is to commodify its enemy. You can all supply your own favorite, most nauseating examples of the commodification of love. Mine include the wedding industry, TV ads that feature cute young children or the giving of automobiles as Christmas presents, and the particularly grotesque equation of diamond jewelry with everlasting devotion. The message, in each case, is that if you love somebody you should buy stuff.
A related phenomenon is the transformation, courtesy of Facebook, of the verb “to like” from a state of mind to an action that you perform with your computer mouse, from a feeling to an assertion of consumer choice. And liking, in general, is commercial culture’s substitute for loving. The striking thing about all consumer products — and none more so than electronic devices and applications — is that they’re designed to be immensely likable. This is, in fact, the definition of a consumer product, in contrast to the product that is simply itself and whose makers aren’t fixated on your liking it. (I’m thinking here of jet engines, laboratory equipment, serious art and literature.)
But if you consider this in human terms, and you imagine a person defined by a desperation to be liked, what do you see? You see a person without integrity, without a center. In more pathological cases, you see a narcissist — a person who can’t tolerate the tarnishing of his or her self-image that not being liked represents, and who therefore either withdraws from human contact or goes to extreme, integrity-sacrificing lengths to be likable.
If you dedicate your existence to being likable, however, and if you adopt whatever cool persona is necessary to make it happen, it suggests that you’ve despaired of being loved for who you really are. And if you succeed in manipulating other people into liking you, it will be hard not to feel, at some level, contempt for those people, because they’ve fallen for your shtick. You may find yourself becoming depressed, or alcoholic, or, if you’re Donald Trump, running for president (and then quitting).
Consumer technology products would never do anything this unattractive, because they aren’t people. They are, however, great allies and enablers of narcissism. Alongside their built-in eagerness to be liked is a built-in eagerness to reflect well on us. Our lives look a lot more interesting when they’re filtered through the sexy Facebook interface. We star in our own movies, we photograph ourselves incessantly, we click the mouse and a machine confirms our sense of mastery.
And, since our technology is really just an extension of ourselves, we don’t have to have contempt for its manipulability in the way we might with actual people. It’s all one big endless loop. We like the mirror and the mirror likes us. To friend a person is merely to include the person in our private hall of flattering mirrors.
I may be overstating the case, a little bit. Very probably, you’re sick to death of hearing social media disrespected by cranky 51-year-olds. My aim here is mainly to set up a contrast between the narcissistic tendencies of technology and the problem of actual love. My friend Alice Sebold likes to talk about “getting down in the pit and loving somebody.” She has in mind the dirt that love inevitably splatters on the mirror of our self-regard.
The simple fact of the matter is that trying to be perfectly likable is incompatible with loving relationships. Sooner or later, for example, you’re going to find yourself in a hideous, screaming fight, and you’ll hear coming out of your mouth things that you yourself don’t like at all, things that shatter your self-image as a fair, kind, cool, attractive, in-control, funny, likable person. Something realer than likability has come out in you, and suddenly you’re having an actual life.
Suddenly there’s a real choice to be made, not a fake consumer choice between a BlackBerry and an iPhone, but a question: Do I love this person? And, for the other person, does this person love me?
There is no such thing as a person whose real self you like every particle of. This is why a world of liking is ultimately a lie. But there is such a thing as a person whose real self you love every particle of. And this is why love is such an existential threat to the techno-consumerist order: it exposes the lie.
This is not to say that love is only about fighting. Love is about bottomless empathy, born out of the heart’s revelation that another person is every bit as real as you are. And this is why love, as I understand it, is always specific. Trying to love all of humanity may be a worthy endeavor, but, in a funny way, it keeps the focus on the self, on the self’s own moral or spiritual well-being. Whereas, to love a specific person, and to identify with his or her struggles and joys as if they were your own, you have to surrender some of your self.
The big risk here, of course, is rejection. We can all handle being disliked now and then, because there’s such an infinitely big pool of potential likers. But to expose your whole self, not just the likable surface, and to have it rejected, can be catastrophically painful. The prospect of pain generally, the pain of loss, of breakup, of death, is what makes it so tempting to avoid love and stay safely in the world of liking.
And yet pain hurts but it doesn’t kill. When you consider the alternative — an anesthetized dream of self-sufficiency, abetted by technology — pain emerges as the natural product and natural indicator of being alive in a resistant world. To go through a life painlessly is to have not lived. Even just to say to yourself, “Oh, I’ll get to that love and pain stuff later, maybe in my 30s” is to consign yourself to 10 years of merely taking up space on the planet and burning up its resources. Of being (and I mean this in the most damning sense of the word) a consumer.
When I was in college, and for many years after, I liked the natural world. Didn’t love it, but definitely liked it. It can be very pretty, nature. And since I was looking for things to find wrong with the world, I naturally gravitated to environmentalism, because there were certainly plenty of things wrong with the environment. And the more I looked at what was wrong — an exploding world population, exploding levels of resource consumption, rising global temperatures, the trashing of the oceans, the logging of our last old-growth forests — the angrier I became.
Finally, in the mid-1990s, I made a conscious decision to stop worrying about the environment. There was nothing meaningful that I personally could do to save the planet, and I wanted to get on with devoting myself to the things I loved. I still tried to keep my carbon footprint small, but that was as far as I could go without falling back into rage and despair.
BUT then a funny thing happened to me. It’s a long story, but basically I fell in love with birds. I did this not without significant resistance, because it’s very uncool to be a birdwatcher, because anything that betrays real passion is by definition uncool. But little by little, in spite of myself, I developed this passion, and although one-half of a passion is obsession, the other half is love.
And so, yes, I kept a meticulous list of the birds I’d seen, and, yes, I went to inordinate lengths to see new species. But, no less important, whenever I looked at a bird, any bird, even a pigeon or a robin, I could feel my heart overflow with love. And love, as I’ve been trying to say today, is where our troubles begin.
Because now, not merely liking nature but loving a specific and vital part of it, I had no choice but to start worrying about the environment again. The news on that front was no better than when I’d decided to quit worrying about it — was considerably worse, in fact — but now those threatened forests and wetlands and oceans weren’t just pretty scenes for me to enjoy. They were the home of animals I loved.
And here’s where a curious paradox emerged. My anger and pain and despair about the planet were only increased by my concern for wild birds, and yet, as I began to get involved in bird conservation and learned more about the many threats that birds face, it became easier, not harder, to live with my anger and despair and pain.
How does this happen? I think, for one thing, that my love of birds became a portal to an important, less self-centered part of myself that I’d never even known existed. Instead of continuing to drift forward through my life as a global citizen, liking and disliking and withholding my commitment for some later date, I was forced to confront a self that I had to either straight-up accept or flat-out reject.
Which is what love will do to a person. Because the fundamental fact about all of us is that we’re alive for a while but will die before long. This fact is the real root cause of all our anger and pain and despair. And you can either run from this fact or, by way of love, you can embrace it.
When you stay in your room and rage or sneer or shrug your shoulders, as I did for many years, the world and its problems are impossibly daunting. But when you go out and put yourself in real relation to real people, or even just real animals, there’s a very real danger that you might love some of them.
And who knows what might happen to you then?
Jonathan Franzen is the author, most recently, of “Freedom.” This essay is adapted from a commencement speech he delivered on May 21 at Kenyon College.
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More for myself! (A blog is also my personal journal) Bruce Springsteen in Switzerland: Dedicates ‘Land of Hope and Dreams’ to Nelson Mandela. Bruce Springsteen and the E Street Band were back in action again on Wednesday, playing a 26-song, two-hour-and-52-minute show at the Stade de Genève in Geneva, Switzerland. Highlights included “Frankie” which was played for the first time in 2013 and for only the fifth time this tour and the encores started with Bruce playing “The Promise” solo on the piano, “Youngstown” and “Murder Inc.” were also played. It was the first show this tour that “Wrecking Ball” was not played. In the 118 shows so far this tour, three songs still have perfect attendance: “Waitin’ on a Sunny Day,” “Born to Run” and “Dancing in the Dark.” Bruce dedicated “Land of Hope and Dreams,” the final song of the main set, to Nelson Mandela. Show began at 7:40 p.m. local time (six hours ahead of New Jersey)
Set list
1. Shackled and Drawn
2. Badlands
3. Death to My Hometown
4. Out in the Street (sign request)
5. Hungry Heart (sign request)
6. Candy’s Room (sign request)
7. She’s the One
8. Because the Night
9. Spirit in the Night
10. Frankie
11. The River
12. Youngstown
13. Murder Incorporated
14. Darlington County (sign request)
15. Working on the Highway
16. Bobby Jean
17. Waitin’ on a Sunny Day
18. The Rising
19. Land of Hope and Dreams (dedicated to Nelson Mandela)
Encore:
20. The Promise (solo piano)
21. Born in the U.S.A.
22. Born to Run
23. Dancing in the Dark
24. 10th Avenue Freeze-Out
25. American Land
26. Thunder Road (solo acoustic)

Statistics: Garbage In, Garbage Out?

I have already talked about statistics here, and not in good terms. It was mostly related to Nicholas Nassim Taleb‘s works, The Black Swan and Antifragile. But this does not mean statistics are bad. They may just be dangerous when used stupidly. It is what Charles Wheelan explains among otehr things in Naked Statistics.

nakedstatistics

Naked Statistics belongs to the group of Popular Science. Americans often have a talent to explain science for a general audience. Wheelan has it too. So if you do not know about or hate the concepts of mean/average, standard deviation, probability, regression analysis, and even central limit theorem, you may change your mind after reading his book.

Also you will be explained the Monty Hall problem or equivalent Three Prisoners problem or why it is sometimes better (even if counterintuitive) to change your mind.

Finally Wheelan illustrates why statistics are useless and even dangerous when the data used are badly built or irrelevant (even if the mathematical tools are correctly used!). Just one example in scientific research (which is another topic of concern to me) “This phenomenon can plague even legitimate research. The accepted convention is to reject a hypothesis when we observe something that would happen by chance only 1 in 20 times or less if the hypothesis were true. Of course, if we conduct 20 studies, or if we include 20 junk variables in a single regression equation, then on average, we will get 1 bogus statistically significant finding. The New York Times magazine captured this tension wonderfully in a quotation from Richard Peto, a medical statistician and epidemiologist: “Epidemiology is so beautiful and provides such an important perspective on human life and death, but an incredible amount of rubbish is published”.
Even the results of clinical trials, which are usually randomized experiments and therefore the gold standard of medical research, should be viewed with some skepticism. In 2011, the Wall Street Journal ran a front-page story on what it described as one of the “dirty little secrets” of medical research: “Most results, including those that appear in top-flight peer-reviewed journals, can’t be reproduced. […] If researchers and medical journals pay attention to positive findings and ignore negative findings, then they may well publish the one study that finds a drug effective and ignore the nineteen in which it has no effect. […] On top of that, researchers may have some conscious or unconscious bias, either because of a strongly held prior belief or because a positive finding would be better for their career. (No one ever gets rich or famous by proving what doesn’t cure cancer. […] Dr. Ionnadis [a Greek doctor and epidemiologist] estimates that roughly half of the scientific papers published will eventually turn out to be wrong.”
[Pages 222-223]

Steve Jobs by Walter Issacson

I finally read the Steve Jobs biography by Walter Isaacson. I hesitated a long time (the original edition was published in 2011) because I feared disappointement. I had read the excellent The Apple Revolution as well as Return to the Little Kingdom. I finally read it in French and it is excellent. Read it if you have an interest in the topic. I’m not going to do any analysis, but as I usually do just mention some striking or subjective extracts. The citations refer to the French paperback release dated October 2012.

jobs-isaacson

Silicon Valley

Various cultural earthquakes upset San Francisco and SiIicon Valley in the late 1960s. There was the technological revolution, initiated by the increase of military contracts, which had attracted electronics companies, chip manufacturers, designers of video games and computer manufacturers. There was a sub-culture, the pirates – inventors of genius, cyberpunks, dilettantes as well as pure geeks, they also had in their ranks electronicians refusing to fit the mold of HP and their impetuous children who wanted to break down all barriers. There were (quasi-academic) research groups, who led in vivo experiments on the effects of LSD, such as Doug Engelbart’s Augmentation Research Center, who would later work at the development of the mouse and graphical user interfaces, or Ken Kesey, who praised the psychedelic drug in shows, combining music and light, run by a group of musicians who became the legendary Grateful Dead. There was also the hippie movement, from the Beat Generation of Kerouac, a native of San Francisco Bay, and political activists, born out of the Movement for Freedom of Expression of Berkeley. And encompassing all that, there were various spiritual movements seeking inner enlightenment – Zen, Hinduism, meditation, yoga, primal scream, sensory deprivation and Esalen massage.
Steve Jobs was the embodiment of the fusion of Flower Power and microchips, the pursuit of personal revelation and high tech: he was meditating in the morning, followed in the afternoon courses in physics at Stanford, working the Atari at night and dreaming of starting his own business. [Page 114]

A passion for entrepreneurship

Bushnell is of this opinion: “To be a successful entrepreneur, you must have something special and I saw this thing with Steve. He was not only interested in electronics, also by business. I showed him that one had to behave as if one would succeed in what one wanted to achieve and then everything would naturally follow. That’s what I always say: if you pretend to know what you do, people will follow. “[Page 111]

His closest friends think that having learned so young, he had been abandoned at birth had left indelible scars. “The need for total control of what he did comes from this injury” [Page 34] … “The most amazing thing about Steve is that he cannot help being cruel to some people – a kind of Pavlovian response. The key to the mystery is the fact that he was abandoned at birth.” [Page 35]

So he went back to Nolan Bushnell, “Steve asked me to put fifty thousand dollars on the table and in exchange he’d give me a third of Apple’s shares. I thought I was smart and I said no. When I look back, I still laugh. Not to cry!” [Page 142]

The reality distortion field

– “This is madness. It is impossible. ”
He was answered that Jobs would not listen.
– The best definition of this oddity, you find it in Star Trek. Steve creates a reality distortion field. In his presence, reality is malleable. It can make anyone believe almost anything. The effect of course disappears, when he is not there, but it prevents you seriously to have realistic expectations for anything.
RDF was a confusing mix of charisma and mental strength, it is the willingness to bend the facts so they fit the mold. [Page 207]
When Jobs decreed that the sodas in the fridge would be replaced by organic orange and carrot juice, someone on the team had printed T-shirts with: “Beware of Reality Distortion Field!” And on the back: “It comes from the juice!”

There is a small bug page 225: To draw circles, Atkinson found a trick based on the fact that the sums of odd numbers gave a succession of perfect squares (for example, 1 + 3 = 4, 1 + 3 + 5 = 8, etc.) [The statement is correct because the last sum is 9 and not 8!]

Being a pirate

“Better to be a pirate than join the navy” [Page 248] And the Jolly Roger decorated with the Apple logo floated for a few weeks on the roof of Bandley 3.

Apple_pirate_flag

The chapters on Jobs’ private life and Pixar are quite interesting. About the IPO of Pixar: “Earlier that year, Jobs had tried to find a buyer for Pixar, for fifty million dollars, just to recover his funds. At the end of this historic day, the actions he had kept – about 80% of the company – were worth more than 20 times that amount: one billion two hundred million dollars! It was nearly five times more than he had gained with the Apple IPO in 1980. But Jobs did not care to make a fortune, as he told John Markoff of the New York Times: “I do not intend to buy a yacht. I never did it for the money.” [Page 471]. He is in this respect very different from Larry Ellison, founder and CEO of Oracle with whom he became a friend who helped him to return to Apple.

Return to Apple

In this regard, there is an funny anecdote page 482: “Two years ago, Guy Kawasaki, Macworld magazine columnist (and former Apple evangelist) published in the magazine a parody telling Apple was buying NeXT and elected Jobs as CEO. The article featuring Mike Markkula talking to Jobs: “You want to spend the rest of your life selling Unix with a nice coating, or change the world?” And Jobs replied:” Now I am a father and I do not want to play adventurers.” The article made the assumption: “Following his troubles with NeXT, it is possible that Jobs, in his return to the parent company, will bring the Apple management a dose of humility. Bill Gates was also quoted; he said that if Jobs returned to the business, Microsoft would again have innovations to copy! Everything was invented and purely humorous. But the reality has this annoying habit of catching up all satires. “([Page 482 and see below]

And on his return: “His credo was perfection. He was not very good at compromise, or to arrange with reality. He did not like complexity. This was the case for the design of his products and the furniture of his houses, it was the same for his personal commitments. If he was sure of himself, then nothing could stop him, but if he had doubts, he sometimes preferred to throw in the towel rather than ending up in a situation that did not satisfy him completely. [Page 509]

Death

[With Markkula] They spent the rest of the time talking about the future of Apple. Jobs wanted to build a company that survives him and asked for his advice. Markkula replied that companies that remain are those who knew how to renew. That had been constant with Hewlett-Packard, beginning by constructing measuring instruments and then calculators and then again computers.” Apple was ousted by Microsoft from the market for personal computers, Markkula explained. You must change the course of Apple to another product. You have to be like a butterfly and accomplish your metamorphosis.” Jobs was hardly talkative, but he retained the lesson. [Page 515]

The music was obviously an essential art in the life of Jobs. We know his passion for Bob Dylan, Joan Baez, and the Beatles. But here’s a most interesting part: Bach, he said, was his favorite classical composer. He particularly liked the contrast between the two versions of the Goldberg Variations recorded by Glenn Gould – the first in 1995 by the little-known pianist of twenty-two years that he was, and the second in 1981, a year before his death. “They are like night and day, Steve told me one day after having listened to one after the other. The first is exuberant, young, brilliant, played so fast that it is a revelation. The second is more efficient, more austere. It reveals a deep soul, a painful experience. “Jobs was sick for the third time when he listened to the two versions. I asked him which was his favorite version. “Gould preferred the latest version. In the past, I preferred the first, the exuberant. But now, I understand better what he meant.”

Isaacson ends his book with a brilliant remark by Jobs on the topic of life and death. “But on the other hand, maybe it’s like an on/off switch. Click and nothing more!” He paused again and smiled. “This is surely why I never liked the on/off switches on the Apple products.”

The legacy

I could have put these final remarks earlier in the section A passion for entrepreneurship. “My passion has been to build a sustainable business, where people were motivated to manufacture great products. Everything else was secondary. Of course, it was great to make a profit, because it allowed us to create good products. But the motivation is the product, not profit. […] The difference is subtle, but in the end it is crucial because it defines all the people we hire, those we promote, the topics we discussed at meetings. […] People do not know what they want until they have it in front of them. That’s why I do not care about market research. […] The intersection between the arts and sciences. I love this juncture, IL has a magical aura. […] Our innovation holds a large part of humanity. I think great artists and great engineers are similar .. Both have the desire to express themselves. […] I have my own theory to explain the decline of companies like IBM and Microsoft. The company did a great job, innovates and comes almost to a monopoly in some areas. It was then that the quality of the product becomes less important. The company praises great sales people […] that eventually take control of the company. […] I hate people who say they are entrepreneurs when their sole objective is to build a start-up that they will sell or go IPO. They do not have the desire to build a real company. […] People should never stop innovating. […] I think most creative people want to thank their predecessors who left their legacy.” [Pages 889-892]

An incredible life. Jobs will remain one of the biggest celebrities of the twentieth century. I wondered when I finished reading this book what I remember of Apple and Jobs and here is the result.

Apple-patchwork-2

Business Model Generation – never too late!

Last week, I attended a workshop organized by Raphael Cohen. He explained his IpOp process. You can read again the post I wrote a few months ago: Proven Tools for Converting Your Projects into Success (without a Business Plan). It’s really a good tool if you need to develop your own project. Cohen mentioned the famous Business Model Generation by Alexander Osterwalder and Yves Pigneur; and he showed us again its 9 building blocks. It has become such a standard… I never mentioned it here. Better late than never!

bmcanvas_v4.indd

You can download the pdf canvas here.

Slicing Pie (how to fairly split equity) – Part 2

Following my recent post (part 1), here is what I keep from the book without giving all details. Moyer probably needs to sell a few copies!

slicing-pie-funding-your-company-without-funds-mike-moyer-paperback-cover-art

Moyer introduces the Grunt Fund as a mechanism to allocate equity between founders. He is using the classical metrics I have used in the past (again see Equity Splits in Start-ups) but he adds one interesting point: a dynamic allocation based on future contributions such as time and cash, weighted with your value (reputation, experience, etc). His process is simple:
– Appoint a Leader
– Assign a theoretical value to the ingredients provided by the various Grunts.
– Keep track of the contributions and calculate the possible equity whenever you need based on the relative contributions by each Grunt.

A Grunt Fund makes some people uneasy. They like to know what they’re getting into and they like the I’s dotted and the T’s crossed. That’s fine. If this is you, then don’t use a Grunt Fund – get a job instead. [Page 50] Then be careful about who and what you need. It’s up to you to decide what you need, but be fair!

Moyer mentions on the following page Noam Wasserman’s The Founder’s Dilemma (which I have not read) as a theoritical validation of his approach.

Without entering too much detail, Moyer gives value to time (2x what would a normal salary be) and cash (4x the actual amount). This is subjective. The critical element is that all Grunts agree with the rules. It can change from one company to the other… “Remember, you need to compensate them for not only the work they did, but also for the risk they take.” [Page 64]

When it comes to ideas or intellectual property, Moyer has principles I am quite close to: “Don’t get me wrong, ideas are critical to a business’ success. But turning the idea into a reality is where the value is built, not in coming up with the idea in the first place.” [Page 82]

Sometimes you will need to remove someone. There are 3 possibilities:
– he/she resigns without cause. You need to reduce his slice;
– you terminate him/her without cause. The slice should be kept;
– you terminate with cause. He/she may lose the slice.
[Chapter 5 + Pages 141-145]

The Grunt Fund is for the early days only. When do you stop using it? When you have a predictable business model, or when you have raised $1M. [Page 114]

As a conclusion (and Moyer mentions it many times), “a Grunt Fund is a moral contract, not a legal contract. It tells us how to treat each other fairly. […] A Grunt Fund is the foundation of a trusting relationship.” [Pages 121-122]