Salim Ismail - Entrepreneur, Author, Speaker | Exponential Organizations & Massive Disruption

Welcome to success story, the most useful podcast in the world. I'm your host Scott D. Clary The success story podcast is part of the HubSpot podcast network and the blue wire podcast network The HubSpot podcast network has incredible podcasts like my first million my first million is hosted by Sam par and Shawn puri They feature famous guests They discuss how companies made their first million and then some they brainstorm new business ideas based on the hottest trends and opportunities in the marketplace Here are some of the topics you talked about if you like any of these you will love the show Three profitable business ideas that you should start in 2022 drunk business ideas that can make you millions Asking the founder of Grammarly how he built a 13 billion dollar company or SaaS companies that anybody can start if these topics are up your alley Go check out my first million listen to it wherever you listen to your podcasts Today my guest is Salim is my own. He is a serial entrepreneur angel investor author speaker and technology strategist He is the founding executive director of Singularity University and lead author of exponential organizations in March 2017 He was named to the board of the ex-prize foundation. He has been building disruptive digital companies as a serial entrepreneur Since the early 2000s as a prolific speaker Salim gives more than 150 talks per year to audiences of all sizes around the world He has been profiled across a vast array of media outlets including the New York Times Bloomberg business week fortune Forbes wired Vogue and the BBC He is a sought after strategist and a renowned technology entrepreneur who built and sold his company to Google So today we're going to speak about all the things that Salim speaks on and teaches We're going to speak about the keys to disruption and innovation We're going to see why some of the largest organizations have trouble keeping up with some of the most smallest agile organizations and why small disruptive organizations always seem to win We're going to speak about the immune response to evolution and disruption in organizations How the world deals with multiple Gutenberg moments at the same time We're also going to speak about how Salim plans to break and fix the world We're going to speak about exponential thinking, disrupting government and the future of civilization and governance So an incredible episode, I hope you enjoy This is Salim Ismail, he's a serial entrepreneur, angel investor, author, speaker and technology strategist So first of all, great to be here. I'm originally from India, ended up in Canada when I was 10 years old My dad hated noise, dirt, pollution and corruption, so India's not so great for that It's schooling in university there, I went to Waterloo, the big tech university and I went to Europe from there for 10 years doing five years of systems architecture building large-scale systems and then five years of management consulting And couldn't start a business in Europe, so I came to New York City and built a predecessor to Twitter Unfortunately, 18 months too early, very bad to be early in the tech space, better to be late When you're early, you just teach the marketplace how to do it and then somebody else comes along and rolls you over But it got me well-known, ended up on the West Coast as the head of innovation at Yahoo And kind of hit across the fundamental problem that is driving a lot of my thinking now Which is when you're trying to be disruptive in a legacy organization, the immune system attacks you Because all of our organizations are built to resist change and withstand risk and yet that's the harder bit Right And I set up a relationship between Yahoo and NASA to do some interesting projects together And one day the NASA people invited me to the founding conference of Singularity University Where they brought 70 thought leaders around the Bay Area and said is it worth creating an educational institution Only focused on accelerating technologies I somehow had never met or come across Rick Kurzweil or Peter Diamandis or the ex-priser even the Singularity And so I was kind of blown away, I asked a lot of questions, but two weeks later Peter says do you want to run it I remember getting off the phone my wife goes how was your phone call and I'm like I'm a dean, I don't know how that happened In laws are permanently confused and seven years of building on Singularity I think was incredibly seminal Probably my secret superpower is that if there's a lecture lab workshop discussion on blockchain or autonomous cars or crisper or drones or neuroscience breakthroughs I've heard each one like 60 times so as my wife says I can pretend to speak about anything at this point And that gave me an insight that we have 20 Gutenberg moments hitting us at the same time The printing press in the 15th century fundamentally changed the world well solar energy fundamentally changed the world And then you have blockchain that totally changed the AI completely changes the world In general, we've had these kinds of breakthroughs once every few decades and we have I think we have 20 of them hitting us all at the same time And this is blowing our industries and blowing up our institutions globally And I'm probably most focused on the structural change happening in society because of the massive tidal wave of these technology breakthroughs hitting us at the same time And I wrote the book on the back of that basically saying we need to organize in a completely new way And we noticed that over the last 10 years a completely new breed of organization was emerging with they'd learned how to scale the org structure as fast as you could scale technology We've learned how to scale technology very well zero to a million users Amazon cloud services you can do it pretty quickly but building the org structure and the actual organization as any entrepreneur knows is painfully incremental and linear And so how how we saw a new breed of organization and basically analyzed 200 the fastest growing companies and said how are they doing this how are they how is Ted scaling so fast using TEDx or Uber or not hiring some drivers or urban bee leveraging on the people's access and that's essentially where the EXO model came from What's interesting is even the examples that you mentioned their their organizations were they birthed in these 20 Gutenberg moments or were they organizations that were legacy because I don't think obviously not Airbnb and Uber and whatnot and Ted I actually don't know when the inception point of Ted was but all the examples you're mentioning are companies that were sort of growing and going through awkward periods when all these technologies were available So I feel like the people that were attracted these organizations even the leadership they were a little bit more forward thinking now when you look at the largest organizations in the world they've been around for 30 40 50 60 100 plus years yeah so when we look at the people that are making moves and people that are disrupting they are the Airbnb's and the Uber's and whatnot and the Netflix of the world but have you seen and have you noticed with legacy organizations them trying to adapt trying to keep up or is this exponential thinking is it is it too much for a legacy organization to properly implement because of the insane amount of layers the insane amount of bureaucracy so a big question there's a few different answers to that for the most part they can't figure this out right when we encountered when we talk to the CEOs of a big company be a doubt chemical or caterpillar or credit suites it took on average they hear about these disruptions and then it took them three years to actually do anything about it right so that's kind of the opportunity of the cost of that three years is kind of incentive yeah like we're in a big bank first years about blockchain it literally takes them a three because what'll happens they'll hear about these and go holy crap the CEO or C suite fellow will go back to the home office will sound like a raving lunatic right they'll give them a white coats on medicine asking to stand in the corner while they do the important work eventually he'll be go on enough that somebody will be sent out to Silicon Valley they'll set they'll go back and go oh my god this is crazy they'll try and go okay we need to set up an outpost over there so they set up an outpost with people in Silicon Valley and people get the those people get excited when they come back in they sound like crazy people so they get ignored then the CEO changes and you start all over again and that kind of pattern it's just it takes a long time to turn a super tanker right and then you turn the rudder nothing happens for a while until the ship the ocean it's that same type of analogy we do see a complete shift with younger CEOs and younger entrepreneurs because they've grown up native to this environment and are doing things in this way there's a great little story I have about this when I we were building our singularity we had it was about six months in the dean of one of the top two business schools in the world comes to visit and he's like super annoyed does he's got a whole bunch of articles circled in newspapers about us and he's like what the hell are you doing there's like two million dollars a PR here and I'm arguably the best business school in the world I can't buy a newspaper an article in the newspaper what are you doing to be trying to explain the model that that are going through it and at some point he goes well you know how big is your team and there was like five of us and I said well you know it's us and his mind broke like literally he was like uh he goes my personal staff in my office is 12 people you can't build a university with five people and I'm like well we are and there's nothing special we're doing we're using google docs for everything we're multi assigning multiple has to multiple just start up style he could not get his head around that about about 10 minutes later he goes can we can we go outside and play frisbee and the next two hours he's just playing frisbee outside we literally broke his mind and that really struck me that's like wait like that guy's running the biggest the biggest school in the world and cannot get his head around this what hope is there for any of this right and one more very quick follow up about five years ago I did a talk a keynote to the conference of 700 deans of business schools who knew but once you they all get together organizer excitedly announces me and says hey we're gonna hear from Selene latest in the exo stuff except what he sees as complete blank looks from the audience and he notices this and goes uh he was how many of you have heard of the exo and out of 700 deans of business schools like two put up their hands now if you're a car designer you may or may not like Tesla but you should god damn know that he's there and they have no idea that this new paradigm exists it just it was just unbelievable because every business school in the world teaches you how to build a 20th century organization there's simply no business school in the world that can teach you how to build uber so what's the what's the lever you have to pull in your opinion do you think it's to to convince those deans or to educate those deans or do you think it's a go into large organizations in the world and you're gonna have a trickle down effect in the business schools uh no i don't think you can fix it because academia has the worst immune system in the world more so then like fortune 500 way way worse i think it goes like uh big companies uh as a bad immune system our institutions like education and journalism and uh health care have their own immune system then you have academia which has its own immune system and they're probably the worst is religion where they'll they'll like kill you if you don't follow the religion right like it's gonna bother you about it so i kind of grade immune systems at that level and we've got a great slide that was put together by Ria Shah the head of global learning at Ernst & Young showing here is 60 things that you'll hear that indicate an immune response we can't do it it's not a priority uh we're not set up for this it'll never work uh all of the normal hundreds of reasons to say no to something and there's ways of beating this and that we found ways the big companies can adapt but it's very rare to see overall we're pushing the envelope and we've got a methodology now to transform big companies but most actually don't believe it because they just can't see how you get there so what is it what is the result that you're trying to achieve with singularity like if you said for example you're talking to a big company like yeah and i would say before we go down that rabbit hole and see how we can actually uh build a company that we should be building yeah um are are there companies that do it is like an IBM yeah so we so i'll give you a great data point when we launched the book we um we scored the fortune 100 yeah on this model we said okay to what extent does IBM use lean startup thinking to what extent is GE purpose driven out to what extent is rocker and gamble has has decentralized decision making and we scored them because we have a survey a diagnostic that that scores a big company and i would did a segment on CNBC squawk box and published this index here the fortune 100 ranked by the flexibility agility scalability of their org structures um and it was a nice little marketing thing we just finished a seven year trailing analysis of that index and the numbers are unbelievable comparing we're comparing the top 10 most flexible agile scalable of the fortune 100 compared to the least flexible in our opinion we tracked them over seven years the top 10 out from the bottom 10 by like three x on revenue growth six point four times on profitability 11 times on for return on equity but shareholder returns which you compound annual growth rate top 10 beat the bottom 10 by 40 x over seven year well like you can't make this up right and we actually did an r squared analysis to make sure this was statistically real so because the umbrella thesis is pretty simple as the as the external world becomes a more volatile your ability to adapt is going to drive market value and now we can prove it like six ways to Sunday so the big challenge now becomes how do you take a big company and make it more agile and we have some good indicators and some good precedents um uh Larry Page from Google came to me a few years ago and said hey your unit at Yahoo's are really successful should I build an incubator at Google as a don't you will have the same immune system response but do something like it keep the stealth pointed into adjacent areas and you see the result is Google X where they have their core information processing capability and the mothership and they use hardware Google card Google glass contact lenses to go into adjacent areas right the master of this technique is Apple uh obviously have your successful company uh they're yes they have a great design capability yes they have a great technology supply chain I will argue that Apple's core innovation is organizational because what they do unlike anybody else in the world is it will form a small team that's really disruptive it will take that team to the edge of the company they will keep them secret and stealth and they will say that that team go disrupt another industry and when you say secret and sell that what is that actually so like the main come the mothership does not know it's happening like Steve Jobs when you put the Mac team really and then they give them their funding and their budget and they just say do whatever you want no no no they may say they'll give they'll give them direction okay go go disrupt payments but so here's Apple works they have a portfolio of teams investigating the future of cars payments retail watches uh uh whatever education you name it and when they think in industry your product area is ready for disruption they go into it and disrupt it and then they iterate their product very aggressively um not only does nobody else do this nobody's even noticed that this is all they do okay so when they think something's ready for disruption they go there's no limit to their market cap of course now when they hit a trillion dollars that was the first person to say they will hit a two trillion dollar market cap just because they can just keep going to industry after industry using this model when something works they fold it back into their mothership uh into the back into their iTunes platform doesn't nobody knows about it nobody knows about it or they'll fail it elegantly etc but it gives them they're essentially an incubator of breakthrough ideas with the platform of design and technology as key strength but the key innovation is organizational right now other team other companies are learning how to do this i.b.a Microsoft has done an unbelievable job of switching from a product sale to a subscription model with Microsoft Office just just unbelievable i think such an Adele should get like a Nobel Prize in business for doing this uh there have been two times of history that we could track where this worked uh and those two examples were i.b.m. and Apple in the 90s and so on only when they were had a quarter or two left of cash and they had absolute charismatic leader in Luke Gerson or Steve Johnson no other company in deep trouble has ever managed to make it so you need a bunch of questions we've been focusing on a tool set to transform legacy organizations and we've cracked it working uh but getting a big organization to they have to first realize they're in trouble be believed that those those path through it that actually then actually take on that path it's like a patient who first shares they have cancer and they don't want to know right and they're not set up to know and you have to kind of wake them up and shock them etc etc um i want to unpack what that toolkit is because that's very interesting but i also want to understand uh going back to that Apple model when they and i'm sure that some of this plays into the toolkit as well but the people so when you build out these uh these teams that are separate from the mothership and they're doing their thing and they're investigating and they're trying to disrupt yeah um what's the what's the person that you're hiring for for this particular role because i want to i want to figure out that person so that somebody listening to this is like if i want to build a company now yeah i need to be looking for these attributes of these traits sure so if you're hiring for so the key concept here is you do not do disruptive innovation in the mothership you do it the edge of the organization pointing into adjacent spaces okay really important um now how do you hire for that there's two ways if we're hiring from inside then every company has about five percent of people that are totally nuts super smart very loyal but super hard to manage and you never know where you're going to fire them or they're going to quit anyway those are the ones grab them put them at the edge and go say go this way right go and build an EXO off the edge of the company uh the best corporate analog we have is Nestle spinning off Nestpresso for about three years Nestle ran Nestpresso line of business it was just a mess didn't go anywhere it doesn't fit inside the corporate structure of food processing etc excuse me you finally set it on the edge separate independent boom multi billion dollar line of business right and so that's the key formulas put it the edge into adjacent spaces if you're setting up a new code at the edge then you ideally want to hire from the outside because anybody from the inside that has any depth of experience will be useless for the future anyway you need somebody as young as possible and as crazy as possible okay so let's talk about the formula so now those are the right people for that but when you when you're going into an organization what's the formula and what's the strategy that you found works so we need to do three things number one is we have come up with a 10 week sprint that we have now open sourced that hacks culture at scale in a legacy organization we found that's absolutely critical and what that means is so the the you know if you look at the fortune 100 data it's pretty clear that we've stumbled across the organizational model for the next 10 years by the end of this decade every organization in the world be it a big company a startup a nonprofit an impact project even a government department will be organized in this week because it's just better so the number one thing is to hack the mothership and change the culture to be more acceptable of this innovation at the edge like apple has done so apples and employees know there's crazy stuff happening at the edge and they're just weighed until there's a reveal and they get to know what it is if you tell them too early they'll instinctively try and fight it okay like for example at Yahoo one of the challenges I had with my incubator is the company kept publishing what I was doing and all the other teams at Yahoo were like hey we're doing that why is he get to do that that it out of that and just sets up a horrible internal politics have to keep it still okay the second is do disruptive things away from away from the core organization if incremental innovation is best at the core disruptive innovation at the edge so we've created a 10 week process called an EXO sprint that hacks culture at scale in a big company we piloted it with Procter & Gamble we've not done it 60 times with big companies average return on investment is like 70 times running for running because the juice is up the internal metabolism of the company and and allows them to accept disruptive innovation so that cultural tolerance now sits so there's something somebody does something wacky at the edge they don't shut it down by default they kind of go wow that's interesting and they let it permeate every level of the organization we found that it does and I can describe why it works and how it works if you want but we found we found a way of hacking culture at scale in a legacy organization and 60 times in were pretty good that it's a true cookie cutter process we published a second book called exponential transformation which is literally a handbook on how to do it how to form the teams what weekly assignments give them and it's a 10 week elapsed process and the key metric we found is that we're able to move leadership culture management thinking three years ahead in that 10 weeks so that's pretty cool um we found that when somebody had a great idea inside a company beforehand they might get funded five or 10 percent of the time after you on this process they're getting funded 95 percent because the company culturally knows now that disruptive stuff at the edge needs to be embraced and not shut down so it makes sense to me that um so I'm I'm curious as to how this works because if you move the leadership along that makes sense but I feel like in a especially an unfortunate 500 if you've ever worked and want to work with one I mean um the the issue is not always the leadership either no it's never it's it's all the mid Barker every middle level management yeah yeah you do not want to change it doesn't mean for 30 years yes so I'll tell you how it works how we do what we do is we work in in PNG we work with a division that was 7000 people it's pretty big division yeah okay yeah um uh in fact it was shared services which is the backend IT provisioning so that's pretty conservative with the law etc so we the we work with them and what we do is we get the top 10 percent of senior management into a workshop at the beginning um the top two layers of senior management and we do a singularity style shock and all blow your mind workshop which is meant to freak them out but completely hey here's the future and it's going to mess with you for example a huge amount of R&D at PNG goes into what shapes should the shampoo bottle be to be attractive to for a potential shopper or what color should the pamper's box be right to be attractive well my wife has a diaper subscription to amazon and doesn't care what the box anymore do you realize this and you're about to be disrupted around yet so the subscription type models are completely disrupting the traditional merchandising model um etc just on a cattoli wacky idea there's a biotech for through where you can spray certain bacteria into your armpits and you never need to use soap again because the soap actually takes off a lot of the good bacteria that sits on your skin it's not great for you so you use the spray and you never need deodorant and you never need soap that's kind of disruptive and do you know about this at least track it right or soylent which is totally nuts etc so we kind of give them that then we kind of leave them alone because the legacy management is not set up for the future thinking what we do is take 25 young leaders future lieutenants of the business and they actually do the work so it's kind of a coaching and they divide into four teams two teams that are set at the edge of the company going what crazy idea can we launch to to blow this company open 10x the second two teams sit inside the mothership and think about what would I do to change the mothership which of the exo attributes would I implement internally they do two five week innovation cycles they report at the end and we've created a half million in an idea the senior management likes the ideas they fund them now what happens is the reason it works is when we've kind of shown the senior management the future when the new ideas come they don't attack them so that's number one number two when those young leaders go back to their day jobs after the 10 weeks is over which takes about 30% of their time during the 10 weeks is not full time because you it's hard to do that but it takes you know somewhere about a third of their time when they go back to their day jobs they infect everybody else with this thinking so we're essentially introducing a viral meme into a company and the best summary of what we've learned how to do in the same way that say Tony Robbins or landmark education or neuro-inwisted programming is able to make a subconscious state change in an individual we've learned how to do that at an organizational level and after 60 times we're pretty good at it okay so that makes sense to me just before we keep going I just want to actually ask a question about when these companies create these these little units at the edge and they're innovating and disrupting I'm going to figure out the rest of the strategy as well but is it not easier just to buy companies and and and but the math the edge you could but the problem is the company can't resist getting its sticky little fingers on it so I've experienced this before too of course so my last company was acquired by a large company and we were supposed to be one of these disruptive units yes and then an enterprise team started developing a product that was competing directly with ours and trying to take it to market and we were fighting for resources and then neither product actually worked out yeah so that I it's so interesting because I've seen a lot of companies trying to acquire and like create these little innovation labs within their organizations but I've seen first hand have experienced it not working because of everything you just mentioned it it never ever ever ever ever ever ever works I've I've never seen disruptive innovation occur in them in the mothership Coca-Cola a few years ago did something really amazing they said we're going to do disruptive innovation transparently in the mother organization I was like wow that's super courageous let's fail miserably but at least they tried right the only way I've seen it work is is the Apple model put it take your crazy people to the edge keep them stealth tell the rest of company we're not telling you what's out there but when we just when we launch it it's going to be really freaking cool yeah right and then launch it off the earth so that requires a different form of leadership then all this the the consensus driven leadership that exists in both most big companies doesn't apply to this model so you have to operate on a totally different way and a large common here's the simple reason why every large organization in the world is geared for efficiency and optimized for predictability they want to deliver the same bar of soap in a million locations if you're a Unilever and when you come in from the side it's like a Roman army marching along in a phalanx formation with shields and spears yeah chunking along you coming from the side it doesn't matter how nice you are you're gonna get speared yeah right and and what you experienced is you bring in this different animal and the company can handle it and I can give a couple of great little anecdotes because I I've seen this before in telcos and banks and stuff but I join Yahoo and I extracted five promises from Jury Yang and senior management to join I want to be off site I want to be able to go off-brand I want to be free of HR and legal rules I want to be able to build on my own technology stack not bound by the corporate stuff ruby on rails we should be building because we're trying to be a startup type structure and the last one was I wanted to be able to give equity in an idea to somebody had a great idea otherwise he could just do a startup especially it's looking but we got all sign off on all of these within two months all five shredded beyond any possible recognition that they ever existed I go to these the HR people and go hey I want to go stock options to somebody has a great idea and they're like we can't do that we're a public company with a regulated stock option plan no freaking way I'm like but I got signed off from Jury Yang and they go yeah you tell Jury to come down and run the stock option plan and deal with the regulatory rules no we're not doing it I'm like you put it and like there's literally ripple across all of these and it was gone my favorite one is about I did get a separate office away from the mothership but about I'm sitting in the empty office with my developers and about a couple of days in the doorbell rings go outside there's a huge furniture truck and the guys I'm here to deliver the furniture I'm like what for we didn't order any goes on from facilities and I'm here to deliver the furniture we open up the back and it's literally full of cubicles and corporate color couches it's like Dilbert help and my guys are like the hell with that if that comes in we're out of here yeah we want ping-pong cable and foosballs and beanbags yeah this shit yeah so so the guys like hey my KPIs to deliver and furnished a new office within 48 hours of window opening and I'm coming in I'm like so I'm like okay hold on a second I'm on the phone with his boss and his boss's boss I'm on the phone with my boss and my boss takes half a day finally I'm able to get rid of the guy who's grumbling he doesn't want his bonus dinged he actually did show up etc etc and I'm like few that was like you know close but we managed to get rid of him my guys didn't quit in protest and all good but it shows you and you you know what this is like everybody in a big company knows this story a thousand homes over okay here's the crazy part two weeks later drawball rings saying guys same truck same furniture and I'm like dude I thought we went through this he goes yeah except my manager changed notice you didn't have the tick box and I'm now ordered to bring the furniture and I have to start all over again right now what's key here what's really key here is he's not being a bad guy no he's just doing with his KPIs and his job description the efficiency of the company operating on a certain metabolism is geared to do that thing when you try and do something radically different it can't cope it just can't cope it will spit it out and so either one of two fact things happens with a disruptive idea in a big company either it gets diluted so much that all the destruction elements are gone and you can it's vanilla and mother mother's milk at that point and up apple hood and mother pie and it's just part of the big company or it gets spit out and rejected and you lose the either way one of the two things happens large organization cannot handle this governments handle it even worse institutions have it handle it even worse and this is the nature of the world that we have to solve if we don't solve that we're we're gonna break the world why do you think we're gonna break the world what does that mean well all the institutions by which we run the world we're set up in the middle ages understood right E. O. Wilson the noted biologist said um we are we have paleolithic emotions we have medieval institutions and we have godlike technology right and there's a big impedance mismatch between those three uh simple example is uh you education was set up a few hundred years ago designed to take a young child train them through the early 20s to be ready for the existing job market well the world is changing so fast we have no idea what the job looks like in five years what are we teaching and you try and update education and watch the fun watch the immune system react you'll get viciously butchered by the existing system teachers unions book publishers regulatory people etc etc they can't cope and it's the same in every major institution journalism the business model is broken democracy is even breaking because the metabolism of a democracy was set up at a time when information moved really slowly and was very scarce if you're in Washington DC you had no idea what was happening in California the speed of a horse was a fast so we had a congress meets occasionally to give people time to literally ride across the country and say here's one of the people I think it and so you could design a structure where things changed over like decades and slowly you bring the population along make broad changes like women's rights or abolishing slavery or civil rights movements or whatever well the world is changing every few months right now we don't have time for that we have an abundance of information gets misused misinterpreted fate and the metabolism of democracy does not work with the speed of change in the world today so every major democracy in the world is a broken I'm from indiregently broken Brazil broken the UK broke three years ago you asked breaking in front of our eyes right now so this is a this is true I've not been able to find a single institution there's about 50 major institutions like healthcare systems legal systems I've not been able to find a single one that survives this in the same way that I don't believe a single big operating company will survive this future that's very bleak no no no you have to you have you can look at it bleak I'm not saying that it's incorrect I'm just saying that it well all I'm thinking in my head is how are you going to go into the US government and change the way that they're organizational you don't you don't do it that way okay what you do so let me address the bleak question versus the thing because it looks you we always relate to that as the loss of an old structure is bad okay what you remember have to remember is on the other side of that destruction is massive opportunity just unbelievable opportunity and what's happening in the world at the highest like metaphysical level is we're going through a transformation and an inflection point of running the world from scarcity to running the world from abundance our entire history like take business for 10,000 years if you didn't have scarcity you didn't have a business and EXO's are actually the inflection point for the first time in history of people finding business models around abundance Airbnb is tapping to an abundance of extra bedrooms lying around Uber and extra bunch of extra cars lying around ways extra GPS capacity whatever and we're finding business models around abundance so that's this inflection point happening but almost every government policy is based on scarcity every industry is based on scarcity energy which has been scarce for the entirety of human history is about to become abundant and we can't cope basically so we need to update all of our things but the future is incredibly magical we just have to figure out how to get them so let's talk about the last two levers that you pull in organizations because we talked about the culture and then I think that was like the main that was the first piece so there's three pieces you do to transfer number one we offer free training on the EXO model yeah old EXO foundations we basically say the companies have all your employees go through this two three hour video training and that gives laser vocabulary down okay number two run a sprint to change the culture and allow disruptive innovation to occur culturally in the organization that's number two and the third is you take your crazy people to the edge and spin off crazy ideas off the edge those three uh done in pair in sequence we'll solve the big company and turn the metabolism around and as I said we've done it 60 times we've now got a very trying truth so talk to me about all these Gutenberg moments and all the technology that we're seeing so where does that play into what you're doing with everything that's the that's the trigger point that's driving this disruption okay so just take let's use autonomous cars google comes out with the autonomous car in 2008 um and the entire car industry looks at that and that says ah cute we sir project it's like two hundred thousand dollars a car for all the sensors and GPS and LiDAR and radar and all that stuff no way you're commercializing that two years later it's hundred thousand dollars a car two years later it's fifty thousand dollars a car because it's dropping exponentially and the entire car industry still goes 50 k is going to spend 50 k for all the sensors then it drops from 50 to 25 to 12 to 6 to 3 it is now below a thousand dollars a car for all of the sensors to do an autonomous car and now everybody's freaking out right the ones that jumped on it already waymo Elon Musk or way way way ahead of the market now to a sense that it's going to be very hard for the market to catch up that's the that's the that's happening in industry after industry be it healthcare be it education be it whatever education systems all our universities or education systems are push-based yet a bunch of kids in a classroom trying to cram algebra into them right they're mostly thinking about lunch but just the simplest idea how much of your university degree did you really work use when you got in the workplace in the answers like near zero okay what we're moving to subconsciously without realizing it is a pull-based learning model when you take on a new job or a role you pull down the skills needed to run that function and do that function and that's how we'll be running the world going for it that's very different from our old push-based systems and how do we deal with that so those are the kinds of tensions that are occurring in this massive inflection point the 20 Gutenberg moments are the or the tsunami that's washing away these old structures and forcing us to do things in a new way um okay so then I then I want to go back to the point you made about there's huge opportunity yes so what is that opportunity to look like because when I when you originally said we're going to break things or things are breaking democracy is breaking and you look at all the other all the other countries in the world where democracy has broke to some extent yeah I don't see today in 2022 a net positive because of that yet so what so how do we got that so so let's follow the model yeah existing system you it's starting to break and then you see an innovation at the edge okay what happens you don't try and bring the iteration in the middle you let that become the new gravity center over time let me give you an example our monetary systems are the reason is we created a debt based structure we floated off the gold standard in the 70s and we grew the economy with debt okay um and that structure for didn't realize the technology was deflationary because up to the entire history humanity advanced technologies cost more so you could grow the economy with a debt based environment well since Moore's law showed up advanced technologies cost less because you applied computation and become solar edit panels become cheaper your TV is is twice as functional a year later your mac plus functional and that blows the the debt based monetary system now the only option is to print more money to keep up that increases the debt so now you're in a spiral yeah okay how do you break that you can't break it from inside the system right at the 2009 crisis Bitcoin appears Bitcoin is the innovation at the edge that operates a true a regulatory free monetary system that's deflationary okay and nobody can hack it nobody can control it now people will try they can't et cetera Jeff Booth who's for me the the chief economist of the abundance age had had a YPO Vancouver wrote this book called tomorrow and he said what Bitcoin gives you is money velocity without debt all our economies and monetary systems gave you money velocity by increasing debt and now we have money velocity without debt and that's the new model it will shift to that over time it's inevitable now you you can go elegantly you can go kicking screaming but you will go because the existing system can't sustain so you see in various countries so you see some countries that are banning it well I'll sell the door is adopting and embracing it you see some country it's interesting when you mention them you know the the response because like the immune response to it because it's talked to any banker about Bitcoin and watch them get hives right they know yet people doing like their own digital currencies actually because we have for the first time yeah innovation in in currencies which we haven't had for hundreds and thousands of years or it's all or if you did it was always state-backed innovation now it goes to the individuals or everybody's like I can launch blockchain let's go for it now they may not all work but at least you have innovation there we have right now a Cambrian explosion I think that when I looked at Coinbase sorry CoinMarketCaptor in 19,100 tokens listed on them so all of them doing fascinating innovation in different ways and when you when you think because I look at this and I see some companies that are are building like like these 19,000 companies or the Arabian bees of the Ubers but when you look at disrupting a government what's the timeframe on that because used to like is it in our lifetime or not because when I look at like okay so we're trying to move towards decentralized currency and that's going to be the best possible solution for society you can't even have someone's grandmother who can purchase it right now without help it's getting there but we're not there yet no no I can't even I've been navigating this NFT world these discord channels etc etc I'm still trying to get my head around a smart contract it's a very very different there's some bylaw you have to be under 25 years old to use the blockchain right so that's an issue that's a huge issue but here's what happens we look at a bunch of different things that lead to disruption either calls them the six D's you digitize is very disruptive for a while deceptive then it becomes disruptive and it dematerializes democratizes etc and you have this curve the key to going from deceptive to disruptive and really making a big difference what happens turns out to be usability so Steve Jobs made the smartphone usable like those old Nokia's were not that clunky they weren't that he made it usable boom we had exponential disruption Bitcoin is not quite usable yet Coinbase has allowed you to purchase Bitcoin but not too much else with it these other blockchains are trying for this somebody at some point will crack the usability and when they do then things take off in a massive way I just find it interesting because if you have regulatory come down on this like if you think of things that were like marijuana for example yeah like if if there isn't if there's some regulatory immune immune response to it or anti immune response to it and they put it into law yeah then you're stuck for 50 years are you not you are but yes you are it's a huge issue and what's happening is the they've tried to regulate these cryptocurrencies but it turns out you can't and I'll give you a simple example is the this is the thing that tippled to talk to the China this China did that and they saw the miners move out of China so sure but then you kill all innovation right you're basically centralized top-down autocracy which they are and now they're having crack down mass more and more and they'll have to keep cracking out more and more no autocracy is either succeeded now no democracy is ever succeeded either but as Winston Churchill said democracy is the forest form of government except for everything else right at least you have some modicum of freedom etc etc the challenge we have in the US is that a democracy relies on an educated population and the population is it's not educated in terms of what's actually happening in the world already does again it brings us back to the information it does it breaks it breaks it so now what's the future I think the future is micro democracies city states rather nation states because we run nation states because they have they were successful because you could have lots of natural resources under one boundary you had critical mass and multiple industries and that big thing just like a big company but now the future is if you look at the pandemic the most successful responders to the pandemics were small countries big countries were uniformly a mess okay Russia China India US Brazil mess all the small countries because they have homogeneity and move quickly they can get their populations to adapt people listen they have a higher trust levels boom hugely successful in little countries in the same way you don't need access to resources today if you have solar energy vertical farming you don't need a national grid you don't need centralized energy pipelines and supplies chains etc so therefore a city state is we think is the future of of organizational model for society and that's where we sing when you think about when I think about Trump or Brexit it's not about left versus right it's urban versus rural really that's the that's the fight well it always is right that's the issue they just have like the coastal cities that the left is pandering to and then middle America is wondering where the hell they're being you know included in this and then it's no longer so longer political ideology it's just why are you focusing on people that aren't going to help me yeah but here's the incredible point and this is why we tend to be so optimistic you throw in solar energy and a water filter that can extract clean water the air of the air and healthcare that can be looked up on the internet and education that can be looked up on the internet you can be self-sufficient anywhere you don't need the centralized government energy system so you can now really be self-sufficient you're not dependent on this there's a huge irony in that the red states take more from the central government than the blue states yeah oh yeah they get massively more benefits to the red states and the blue states the blue states tend to be a tax negative tax income they get they get they give in more and they take it out less and the red states tend to get more subsidies and give more give them because it's supposed to be the other way around yeah that's just the US and it's you know all of the magic of the I live in Florida in Miami these days and you know there's a whole phrase in the news called Florida man right yeah Florida man tries to kiss alligator right like it's just there's a level of in madness that maybe comes with the humidity and people do just the most ridiculous things against their self-interest we saw that with a mass and so on you just want to take a second and thank the sponsor of today's episode HubSpot now as a leader you're always on the lookout for more ways to arm yourself with knowledge the books the seminars and most importantly the podcasts that help you make the best possible decision for you your company your customers because when you know more you can apply more and you can grow with HubSpot CRM platform you can store track manage and report on all the tasks and activities that make up your relationships with customers with a bird's eye view over all your customer interactions HubSpot empowers your decision making like never before so you can give your business and your customers all the good you've got learn how to make your business grow better at HubSpot.com so let's let's talk about starting organizations yes so you're an entrepreneur you want to start something yeah what's your advice for somebody starting something is there a way that they should look at absolutely before we go to that let me just finish one big thing about if if you apply this model in big organizations it really got them works I'll give you an easy example Amazon has a policy inside Amazon called the institutional yes because they realize the immune system problem in big companies they realize this is really easy to see no so they created a policy where if you have an idea inside Amazon you come to me I'm not allowed to say no my default answer has to be yes for your idea if I want to say no I have to brand a two-page thesis on why it's a bad idea and posted publicly on an internet for ridicule and shame so they crossed friction they increase the friction of saying no meaning it's much easier for me to go yeah go do it you'll fail downstream I don't believe in your idea but go for it yeah right one of the results you have which is the out here I have to with one of the results of this policy was Amazon Web Services nothing to do with their core strategy nobody could figure out and had to say no to it now one of the most successful products of all time the deliver 75% of Amazon's profits just by stopping the immune system and mitigating someone like if you one last example is very powerful in the corporate world Mariette hotels is worth about 50 billion dollars today if Mariette had launched TripAdvisor booking.com Airbnb their market cap would be 250 billion dollars 5x higher the user reason I used to say this is all of those ideas or inside Mariette the immune system didn't let them out so for fear of cannibalizing the existing business they leave 5x market cap on the table so just let that register for a bit okay so that's why we're pretty clear they have to be organized in this way so then how do you start any exo yeah we have a very clear and very simple model for how to build and it's now being followed by tens of thousands on the world number one most importantly what is your massive transformative purpose what fundamental problem are you trying to solve the founders of ways of trying to solve traffic google's mtp is organize the world's information Uber is everybody's private driver it's a single statement that kind of encompasses here's the challenge here's what we're trying to solve here's what we're about Paul Pullman at Unilever read the book ordered every brand in Unilever to have an mtp and after three four years the five most profitable brands are the ones that have adopted at the most so we can see the model bite what that does is gives you a clear statement to the outside world here's what we are about here's the fundamental problem that we're trying to solve the community then appears around that Google organizer will be the same driver depending on that can you help me understand for somebody's listening to this they're like well what's the difference I know I have to have a vision and a mission and these are all things that I've heard other people say that I should have as a as a founder what's the difference the vision could be I want to see a MacBook in everybody's home okay that's the vision doesn't tell you where problem you're trying to solve the mtp is think differently right um Uber can say we want to be in five million cars have five million drivers but that's the vision but the problem they're trying to solve is everybody in the world should have a private driver so it's it's the problem statement that you're getting attached to not the outcome solution you get attached to the problem the leading indicator that the mtp cure cancer yeah right and it's not that I'm going to cure cancer it's like I'm it's a call to action we are collectively going to cure cancer now so that's number one and most important every EXO we ever saw has an mtp so simply we'll be hiring now in the future based on the organizational mtp and your mtp the natural fit we're starting to see that already especially the younger generation is very purpose driven etc first ones you hire hire them nephews you rather manage them which is the whole other podcast episode that has passed my pay grade but so number one you do that and then you join a create community here on that mtp or join existing communities if my mtp is cure cancer lots of existing communities I can tap into that step two now you're part of a group an ecosystem a hive mind trying to go after that problem step three find a founding team we think four roles you need to have a visionary a product guy an engineer and a business guy those are the four and they could be under over five people four people two people could have more multiple hats those four rows have to be covered and you get a founding team excited about that mtp step four is what is the breakthrough idea or product or service you want to bring a market this is really important because almost everybody in in the history when we're building a business we go wow look at this bluetooth technology let me see how I can push this out into the world okay so they're trying to push system to succeed they found a great technology they think it's solved lots of problems exos tend to be problem driven and then you find a breakthrough solution that matches then you're agnostic like Elon Musk his ntp's go to Mars and whatever it takes to get to Mars that's the technology he'll use he's not found oh we have 3d printed rocket engines let's use these and get these out into the world so it's problem driven very key and that breakthrough idea or your product or service that you bring the market has to be minimum 10x better than the status quo in the marketplace if it's 10% better the market will ignore it if it's 10 times better the market cannot ignore it how do you how do you measure that giving example a typical combustion engine car has 2,000 moving parts in the drivetrain the Tesla has 70 my listings per employee Airbnb is a hundred times more than the rooms per employee in merit so there's a bunch of ways you can metrics you can apply per industry per vertical to decide my healthcare my cancer detection device can do cancer detection 10x better than a mammogram exactly so this is easy metrics in a depending on the problem statement now you have your products and service then you do your then you follow the lean startup methodology MVP lean startup canvas business model canvas once you've got that going and you're iterating then you add in the other EXO attributes dashboards OCRs lean startup thinking decentralized org structures eventually leaning to dows etc etc build algorithms into the product etc and you finish the tick list and then you keep running that model and like the most the most critical thing in a startup which is finding that PMF is so much easier now because you haven't tied yourself to that one product exactly that one product that you think is a good idea that's right you're trying to solve the problem you want to solve the problem very smart very smart and and and talking to your companies that are doing this well so as people can look through examples outside of like the big ones like the newer ones that are starting there's almost every startup today is following this methodology one with the other soil int is a great one yeah right um solve nutrition not can have a better fruit product solve nutrition in some way say perform there's the easy Ted is a good one let me use Ted as a little case study I'll give you two case studies Ted is when Ted has been around for a while thousand people a year are going to monitor in California Chris Anderson takes it over he does three things establishes an mtp ideas were spreading right then he gives all puts all the Ted talks on youtube for free leveraging with media um then he allows anybody in the Ted community to grow created Ted X event and boom in 10 years he's created a global media brand nobody's ever created a global media brand uh that fast before and his cost of doing this was near zero so you can take an established environment blowed open to a global level at near zero cost so that's a good example of an EXO okay I'll give you a slightly more newer model there's a if if I ask you use cars how would you disrupt the use car market um it's not that obvious you might have a better app maybe I can deliver the cars to somebody maybe I ensure the car that it's give a better warranty so people have used cars you have Carvana and a few other models that are popping up okay Chinese company called guazi says okay we're going to attack the use car market they show up at somebody who wants to sell a car they take 250 data points photo video audio they have an audio of the engine machine learning algorithm listens to the engine peturbations and is able to detect if there's any issues the engine by the sound pretty easy over millions of engines sounds they can figure that out pretty quickly and gives them a real time on the spot price of that what they what the engine thinks the AI thinks the cars work if it's worth $10,000 I should offer you $9,000 10% less that will go beef it up and try and set it up for $11,000 okay that's it that's their model but that real-time pricing is very attractive to the seller the buyer also knows that they've got this they've done all that research and due diligence and they're not the margins not that higher they're not trying to fell 50% more 10% more so the buyer goes a good confidence in this the company seven years old they've captured 80% of the use car market in China wow two two million cars a month okay and I will suggest to you that anybody in the real world anybody in the car use car industry cannot get their heads around that statistic well because 80% market share in seven years which is insane which is not absolutely not but so the problem they were solving is friction yep it's a friction problem that they sell for well they're trying to read into like why they captured 80% in seven years because everything you're doing is good but 80% in seven years is absolutely insane yeah it's impossible yeah right people say you're not you're never gonna do that this is an enormous challenge with the exos because you get outcomes that people literally can't believe so you can't tell people that you're gonna do that because they won't believe in investor will yeah yeah yeah yeah just look at the thing about this I did this thought experiment Chris Anderson if you would launch TEDx in a traditional way you'd say all right we're gonna do four TEDx events this month the next month we're gonna do four more we'll do eight following month we'll do four we'll do twelve maybe the following quarter will do 20 and then 30 a month then 50 a month that's already crazy 50 TEDx events a month 100 a month 200 a month okay over our period of three four years we'll get to maybe a thousand TEDx events that's it to do a month etc now who's gonna do all this who's gonna set it all up etc now if you told the team you're gonna do inside what he did was here's the mtp ideas we're spreading here's the rules on how you set up a TEDx event you can go follow the rules self-provision from the mothership the signage and the rules etc off you go in five years they ran 20,000 TEDx events now if you went to an investor and said we're gonna run 20,000 they'll go I'm sorry you're not if you told the employees on the team you're gonna run 20,000 they'll quit they'll just go you're barking mad you're I'm out of here I don't need to be do the lab with that kind of stress right so it's really tough because if you actually lay out the projections you will lose everybody yeah if you try and be reasonable you'll leave so much on the table and let me give you the best example of an exo entrepreneur we have today which is Elon Musk his methodology is really really simple he looks at the technology it's growing exponentially solar energy battery technology neural implants whatever where will that technology be in 10 years on the doubling pattern and then let's build an exo to intercept that curve over a 10-year period that's it just rinse and repeat so he builds community-based environment around the Tesla around SpaceX etc looks looks looks that he's got an mtp go to Mars yeah solve energy uh solve uh solve energy and solve a neural link whatever um so you set your mtp you look at the technologies are gonna give you 10x or doubling patterns over that period of time have the courage to go okay that's where it's gonna be in 10 years for example when he launched the Tesla in 2010 battery prices were x by the end of the decade lithium-ion batteries are 90% cheaper than 10 years ago okay now the car industry does not dare make that projection and no car executive will go those batteries are gonna be 90% less they can't get their head around exponential thinking so entrepreneurs today have all the advantages big companies have all the disadvantages the one thing that i thought touched on a few times it was interesting that i've seen a lot of the things you're speaking about in real life i've seen a lot of these companies uh deploy like the exo model yeah but the one thing that i have in senior is dows and decentralized organizations so so that's a very interesting uh it's a very interesting idea yes how does it work in practical because even even elons of the world are not dows yes so uh dows are non trivial it's like a big co-op running on a blockchain and co-ops have governance issues right the challenge of dows the benefit is you can scale very very fast will you set a center rules 10x is essentially a dows type structure somebody can self-select agree to a set of rules come in take the kit go build an yet go build a 10x event on their own with very little permission to franchise though you could call it a franchise a franchise an old model of doing this um and the dows similar uh blockchain based smart contracts government do the governance etc the challenges with dows are are exclusively have to do with governance nobody's ever seen those um austin hill who runs block stream actually told set it well for me so think about a public company annual shareholders meeting yeah with little grandmothers waving their chairs around going what the hell are you doing and it's like it's a shit show to my language and now scale at the internet scale yeah and that's a now governance right so that very very very scary very trying to you're trying to actually build something what you have to do is slowly migrate your community and do governance over time and bring them along with the journey so they you build more and more governance into the community and so we are building with the EXO basically a decentralized McKinsey's where people can do consulting on the EXO model they self-provision on training they can go apply those tools to their local companies go we now have 17,000 consultants in 130 countries you start to fly this and we're yeah so now we've we've been steadily moving for four years to try and become a down has taken us four years to get the community voting the governance somebody does we have a bad actor in the community what do we do with him yeah it's not good for us to say we look like the bad guy for you say the community should vote what should we do with that person who's creating a competitive thing because they're not used to it they're not used to it takes a long time to do so you have to train them you into getting involved you have to figure out the right how many people should be on the governance committee to decide that it's really really it's going to take us a long time to work out the governance models for DAO's it's it's a non-trigger right now we've got the burst of irrational enthusiasm oh my god everything great in the world would be DAO's and it's like the peak of the hype garden or hype cycle right we'll go through the chaos of the the crazy expectations and people go oh my god this will never work and then it'll just start happening as all technologies go through but we're right now the pico hype cycle of DAO's with everything that you've worked on with exo a singularity what are the problems that you're trying to solve right now so what are you most focused on right now that you're concerned about the skipping up at night that you're seeing in organizations or or or is it just is it just the you just kept building out singularity you kept deploying this in companies and you're just trying to scale that effort up no we've successfully applied EXO now in thousands of companies around the world and people are still working and it's yeah it's working and people are taking up the model for example the minister of oceans and Mauritius called me up a couple years ago and says hey I run my ministry on your book I'm like wow that's you know very good pretty thing now so we're we're starting to see the model bite in kind of ulcerous or fascinating and I expect replaces and the model is it's just because it's better yeah and and importantly we didn't invent this right we analyzed 200 companies and just tagged what they were doing and created like a tick list for people there's no massive innovation we just brought all of the attributes people are using into one place so they can and given some prescriptive path as to how to apply these ideas and people are following that model so uh so that's off to the races what I'm fascinated by and most passionate about now is how do we transform society because we have to move society well mtp you have to go big right and so my my mtp is to transform civilization and it actually came from something my dad said I do this late night talk on metaphysics philosophy in the meaning of life it's what I'm known for it singularity I did it for every class every year we do this because you come across all these technologies and you really ask the big questions synthetic biology robotics AI what does it mean to be human when I have a pig's heart inside me and all my organs are probably my my brain and memory are in my smartphone etc right at what point am I non human human what is the purpose of life what's the future of longevity you really started or god you really start asking big questions we found the students couldn't apply themselves so in the middle of every class duration we would do a late night wrench salon alcohol mandatory on metaphysics philosophy in the meaning of life and it's led me to this level of thinking that systematically systemically we have to change the world if you look at civilizations in the past the Romans the Incas the Mayans they got to very sophisticated societies then they had a boundary condition and they literally fell off a cliff suddenly collapsed every single one of no no civilization has not gone through this process you talk to the Yuval Hararees and the Neil Ferguson's of the world those conditions exist right now so now how do we prevent that collapse in a in some systemic way and minimize the damage the downside not end up in several hundred years of the dark cages we have two choices as humanity today Mad Max or Star Trek and our politicians are sending a straight down Mad Max but with all the technology abundance we actually have the opportunity for a Star Trek world and I'm interested in how do you make that pivot so I did one of these late night sessions my 90 year old dad is at the session somebody goes I really liked your talk fixing civilization where I talk about this immune system problem my dad's go hand goes up he goes can I heckle like yeah of course he goes totally disagree with your talk I'm like oh do you do not think we need to fix civilization yeah of course we do but that's not the problem problem is not the fixing part the problem is the civilization part what do you mean he goes and he goes we have not civilized the world we've materialized the world now we have to do the work to civilize the world and it's like wisdom in the elders come home right and the whole audience while yep yep that's it I lost all credibility and I was like wow he's right we actually still you look at the political discourse in the world today or in the US or in England or in the Russia Ukraine war we are not we are apes with more and more tools or apes with nuclear weapons yeah we actually have to do the work now civilized civilization ourselves and I think it starts with this immune system problem we used to a particular pattern and we have to undo the old thinking and apply new thinking to embrace abundance of energy just that changes the world so fundamentally that none of our existing systems institutions business structures can deal with that simple fact so we have to come up with the new models which is essentially how we think about this the really great part is the Clay Christiansen with innovators dilemma identified and created a valid theory for disruptive change disruptive innovation we've now developed the tool set for applying disruptive change prescriptively so we can do that in companies first which is the easy part as we learn how to apply that to institutions into government then we can navigate cleanly through this future to ending up in a Star Trek world rather than the math Maxwell you think that the the the ability to improve civilization or to civilize rather will be through large organization or is there a a version well there's a version of what you're doing that has to be deployed with the individual not the organization so how do you do that so I'll go back to my city versus state issue we think it'll operate at a city level we think people self-provisioned with these new tools and just go do it and over time that'll become the default model in the world so for example Puerto Rico is deploying micro solar micro grids with solar energy battery power philippines the same thing people are self-provisioning on these models you look at gaming world axi infinity tens of thousands of families pulling themselves out of poverty it's the biggest it's essentially wealth redistribution using a gamified environment there's unbelievable reasons to be optimistic in the world there's a really important part a piece that Peter Diamandis identified in the book abundance in the back of our brains we all have this little organ called an amygdala and it's a evolutionary mechanism that we've all done the planes of Africa if you're if you hear noise in the bushes you run because bad news can kill you good news does not kill you right if I miss some good news I might miss some fruit that I could eat I miss something like that if I missed a piece of bad news I could die so we're actually ten times more likely to pay attention to bad news versus good news because of the survival threat from when we evolved okay this is why all you hear in the news is bad news because you pay attention to bad news this is why Fox News does very well if you watch Fox News you're going to die this week if you're lucky you last on next week but then you're gonna die next week if you watch a Peter calls CNN the crisis news network when you can track every bank robbery in real time high definitions stream to 20 devices you think the world is gonna go to hell and you vote based on that fear and then you end up with Trump or Brexit or whatever the world is actually an infinitely better place than we have ever seen on all the data that you want to pick any data you want to pick we're infinitely better longevity life cycles maternal mortality infant mortality cost to telecommunications transportation are all thousands of times cheaper than they were a while ago I'll give you the simple statistic two there's a there's a cost of what do you mean by extreme poverty it's on two dollars a day of two thousand eleven dollars if you get less than two thousand dollars that's called the screen poverty so they use that parity equivalent across the ages 200 years ago in 1894 um 94 percent so not 18 are 1820 200 years 1820 94 percent the world lived in extreme poverty less than two dollars equivalent a day at the time 94 percent in the population that has dropped steadily over the decades we're down below 10 percent today we're about 8.9 percent right now you don't hear that in the news it's good news doesn't sell and Bill Gates predicts we will eradicate extreme poverty in this decade you will just not see this in the news you're hearing the news is oh my god autonomous car killed somebody and so we have to overcome the natural evolutionary thing of our amygdala and it's very difficult it's it's gonna be easy if it was gonna be easy people are done by now but at least we have a really clear idea now of the problem space we really understand the problem space we're not sure that problem space it's actually pretty easy and the here's why I'm so optimistic these new technologies for the first time in human history cost a little very little throughout history advanced technologies always cost a lot and only a big government or a corporate lab could afford to do R&D launching product and services but look at today solar energy's cheap sensors are cheap the blockchain is open source and free for the first time in human history entrepreneurs with no money can radically innovate bettolic buttern 18 years old ignores as professors half a trillion dollar industry I will suggest to you that no banker in the world can get his head around that I can't get my head around that right how does an 18 year old creating half a trillion dollar ecosystem that's just unbelievable that gives me unbelievable optimism because when you have thousands of entrepreneurs now innovating at low cost magical things are gonna happen and there's nothing anybody can do to stop it and you'll have more of that good they will permeate yeah I'll give you this last data point which is okay I can create a new innovation will I do good things with their bad things with so when Craigslist and eBay emerged there was a really interesting question will you have positive transactions or negative transactions and for the first time I can have an open system where I can do good or bad I can easily on eBay post a picture of MacBook you send me a thousand bucks and I'm gone I can post I can mask my email address pretty easily so anthropologists and sociologists have studied these systems right what's the actual ratio yeah of fraudulent versus constructive transactions on an eBay crisis they've studied these systems in quite detailed equally I can do either turns out the actual ratio across all of these systems is something like 8000 to 1 so on eBay there are 8000 positive transactions to each fraudulent transaction that should apply to the general population so that means if you have something like drones 8000 people do do something positive with it and one person will do something negative that means that one person is really easy to spot and be given the 8000 we shouldn't let anybody do whatever we want to do with drones except our regulatory based on fear says oh my god drones you might use it for something bad ban all drones until we can slowly open that tap and it's taking us a very long time to take advantage of these new technology I would even want to go down the path of figuring out some of those those high-level esoteric conversations that you have in that group but I think that's like that's what holds it for and that requires some alcohol we can do that two two genitalic minimal we can do that one time all right um okay let's close this one off for now because we've gone through a lot of stuff I just want to give you the floor is there any other things that you want to bring up the highlight that sort of tie into conversation that we have and then I'll do a couple rapid fire at the end of sure last point well I think we have a very clear prescriptive path for any company to turn itself into an EXO now and it's largely just free as you want to make it free training on EXO take the sprint and run it for yourself if you want and we've laid out the methodology for people the companies that are using these processes are getting 70 times a return on investment from this effort from just the work of transformation so we and it's it's you know when we first started this conversation 10 years ago about what we have in your nobody believed me and we didn't understand we didn't have any data points Tesla wasn't rampantly successful we were in and Airbnb were just getting started it was tough to say hey the world's getting disrupted big companies like yeah we don't see it at all now it's a very easy conversation much more than that we have a prescriptive path on how to transform and I think that's the unbelievable opportunity that's a tend to be this why we're so excited about the future where do people go uh website social all that um our website is for you too for you as well so my website is selema smell.com and you can search for me on youtube and and there lots about me spiting on um our website for the platform and our community is open EXO.com and on there we offer a free diagnostic where somebody could score their own companies see where they are the training is free we have to pay a target bit for the certification because we have to do some work to certify but the video training is free and we've open sourced in the exponential transformation how do you run the sprint and actually Peter Diamandis and I are now co-authoring the second edition of the EXO book uh and that's essentially going deep into the model and saying what is an exponential organization where the characteristics and how do you start one and that book is coming out in a few months we just finished the main writing for it I had to rewrite the whole damn thing after NFTs and blockchain came out because it's quick things change you look at you look at you take a community and you apply crypto economics and boom the results are undeengagement level is unbelievable actually I didn't even mention this but when you mentioned uh figuring out your MTP and building a community around that that's what I that's what I found like if we look at all the most successful companies and projects at any stage to all about community building completely look at all the successful blockchains community plus crypto economics and now it transcends blockchain too like it's completely it could be a CPG company it could be a service company you can build community which is that's like everyone's like okay the buzzword is community but how the how do I do it well you galvanize people around the cause bingo I'm tp. Yeah exactly okay I bring me back to you yeah you've had an incredible career what was the biggest challenge that you've had in your own personal life or professional but how did you overcome it what you learned from it um biggest challenge was I found that every three four years my career would just end in a disaster and I had to reinvent myself and I used to look at that as negative and oh my god my career just ended disaster um and then I found that's actually a massive positive transformation because the next thing was always 10 pounds better than before I joined Yahoo super accepted by hacking a big company find I can't hack the big company microsoft tries to buy it this is a nightmare I leave singularity was a hundred expect singularity is unbelievable world's top thinkers I'm interviewing them all on stage moderating events for four years I've got the world's kind of information in my hands and being able to transmit that to tens of thousands of students incredible uh the EXO book was 10 times better because now we can say here's what you can do about it and now we can give people some guidance and a prescriptive path to managing transformation um that was unbelievable and now we have a community of like a hive mind of 17,000 people that are the most incredibly inspiring people I've ever met and I can ask a question in that community what do we think about X and I'll get this most unbelievable like almost a doctoral thesis of hey here's why here's what I disagree we get this kind of dialogue and dialectic discussion on some topic autonomous cars or what do we think Elon muster by twitter you just get this rich discussion that makes everybody 10x smarter and and actually just to follow up on that point when you built out singularity um how did you like you had your mdp for singularity and I'm sure that's what helped you build the community around but how did you how did you tap into the 17,000 people when I don't think there's ever really been much done like what you're building um so singularity uh did two things so the main brainchild behind singularity is Peter Demandis he had built international space university and he read as well that says ex-prises Peter I'm not on the board of ex-prises because it's actually worth touching on this the reason these ex-prises work is when you put up a ten million dollar prize on space it turns out about 30 teams will spend a hundred and fifty million dollars in R&D trying to win the ten million dollars so it's the best leveraged innovation model ever found and the collective innovation has created a two trillion dollar space industry that didn't exist before so you put up a ten million dollar prize and you launch a two trillion dollar industry that's unbelievable right so if we're optimistic and enthusiastic about the world this is why we see these structures we see these technologies we see these breakthroughs so I joined the board a few years ago and it's been fascinating to watch that community spread this what happened with singularity is when the idea was can we train the world's leaders on the future and the idea was let's bring the young students the thirty-year-olds it can be running the world in the next ten years and arm them with the future of technology and awareness of what's where will blockchain be in two three five seven years where these technologies intersecting what are the true inflection points you should be tracking and send them back to their home countries and when they get to positions of power they should be making better decisions than our horrible crusty 80-year-old leadership today right and that's now proving to be the case in countries around the world once we have the the kind of platform of that thinking around the world the prescriptive aspect of exos and how do you now organize for this not just private sector but public sector becomes really powerful now we can transmit that layer say here's how you organize for this and there's enough people around the world in different countries like minister motions and Mauritius yeah that's that's right and get that out there and now we can feed that platform that exo platform of incredibly bright people around the world with new ideas and say hey who wants this who wants that who needs what and we're turning that into a doubt and as we move towards kind of governance and thing it's just because it's easier we don't have to manage it it's a nightmare to manage it yeah for the community it's really in multiple languages yeah and we speak 46 languages so this is a huge challenge building this ecosystem I think we want to get to about 100,000 trained people in the community and then I'll feel comfortable that we've got enough critical mass to then attack institutional transformation that'll be the next layer around this you've had a lot of people in your life mentors in your life people that have had huge impacts on you if you had to pick one wasn't why is why is it that person and what did they teach you I can't just pick one I'll pick two pick two okay uh Peter Demandis has to be one of them um is is incredible energy and ability to think of scale think of the thing he he's the one that's moved most of us from scarcity thinking to abundance and he's got this unbelievable like when he runs into a problem he just executes his way out of it and that sheer gumption of just hacking away through it like when you tried to launch enterprise nobody would fund a prize the financial system was crashing and he just tacked away at it until it's sort until he got there and there so that's kind of an incredible awe inspiring model um the second I would say is somebody who passed away recently Lawrence Bloom who is the I think he was the first chairman of the World Economic Forum he's been thinking in a systemic change level of how is evolutionary consciousness changing and he kind of showed me those a whole large group of people that as are thinking in this way but they don't know the path to get there and so it's been incredibly inspiring to see that there's large groups of people who think about systems change and we're providing the tool set and capability to navigate and to support that grouping changing the world um and the final thing I would think is the the younger generation today is unbelievably inspiring to me they're really driven by like good things in the world and I'm unbelievably optimistic about what's happening in the world in general you see the unbelievable outpouring for help in Ukraine etc we can now transmit combat compassion around the world and I think it's really exciting there's so there's so easy to focus on the negative but we forget to focus on the unbelievable positive nature I'll give it the smallest example if you went back before so people complain about all the damages self-blowns during etc we have a 10-year-old child if you were raising a kid 20 years ago you had a babysitter coming you have no idea she can be late is he gonna be late are they gonna get there on time uh what if they're if they're later they actually coming are they just late do you end up with all the stress and worry about what's going on now you're texting back and forth I'll be the I'll be six minutes late my bus is late whatever and you have infinite knowledge and you can you get infinite more peace of mind because you have so much more data about the world people forget that people forget the unbelievable benefits from the magic of all the technology we have allowing us to video anywhere in the world for free with my son and with people everywhere yeah just and under the world is such an incredibly magical place we get super excited by the future uh and and try not to get trapped in the past so the younger generation learns and Peter and and then my wife who holds the spiritual foundation you know I used to make a lot of money and then lose a lot of money make a lot of money and lose them all do well total mess up then I met my wife and I do well not mess up do well not mess up she was this like foundation to stop me from totally messing up then I'd go to the next thing not mess up and so that's been profound because the the depth of potential has just increased in the past incredible if you had to pick a resource a book or something that's had a big impact on your life what would you recommend people go check out um I do I suggest two one is the zen in the art of motorcycle maintenance which laid down a kind of notice over 1974 I laid out an overview of all the different philosophical schools at all yeah it was incredibly powerful but more powerful was this the sequel to it called lila published 1995 relays out here's the metaphysics of how the world works and that just blew my mind so that would be one the second would be the power of myth by Joseph Campbell just laying out here's comparative mythology we have the same myths in all of our different societies and what what is human aspiration all about and then the third would be probably the power of now by Eckhart Toley that gives you a deep snapshot on how to be present and the importance of being present um those are all kind of fairly spiritual books I have a degree in theoretical physics so quantum mechanics I find fascinating oh I've got a great little suggestion for your viewers there's a 11 minute video on youtube it's called the delayed quantum choice experiment okay if you ever think somebody is spouting out about quantum mechanics and things they know what they're talking about oh wow go send them to this video called the delayed quantum choice experiment and just blows your mind okay good so I'll find it I'll link it in the show enough that'll be good there you go um if you had to tell your 20 year old self one thing what would be um playful out just go playful out and the hell with the consequences don't worry about what society thinks of you and back then when I was growing up there were a few role models to uh to indicate how to live and so I had to rely on faith chucking me around and beating me up like today we have the Elon Musk we have the Vitalex we have people doing who addically crazy things and teaching the whole world you have one life you can live it uh in last question yeah what a success made to you uh success for me I think is I like the the best definition of leadership I've ever seen is the opportunity the pretend to serve the potential in people around it and I think for for me the success is creating a potential for every human and it to live uh fully