Classroom 2020: VCs and the Education Revolution

Entrepreneurs jumping on VCs

Entrepreneurs jumping on VCs

Mitch Kapor (Kapor Capital), Philip Bronner and Robert Hutter, moderated by Betsy Corcoran started by framing the problem with current education. Each of the speakers showed shocking graphs of educational attainment, inequity and the job market.

Philip Bronner immediately lost my intellectual respect when he started talking about how Novak Biddle invested in Blackboard around 15 years ago turning Blackboard into the de facto operating system of education. I do hope that this isn’t true. If it is, then I would consider that an affirmation of the problems, rather than part of the solution. Bronner then went on to define education as consisting of three pieces: content, somebody who teaches you the content and a way to certify that you know the content. Education as content: pretty shocking.

Hutter talked about data (Kapor would call them “anecdotes”) about programs that make good use of digital tools getting objective better results. It is Hutters goal to help scale up this programs and the last three years two things have happened that will have a big impact in this: campus wifi is everywhere now and batteries have made a humongous leap forward.

This whole panel is a complete mystery to me (to not call it surreal). Discussing education as if it is a market just sound plain wrong. I believe that the one thing that should have been discussed is the question of the actual purpose of education and who is responsible for providing it. I would suspect that each of the panelists would give a very different answer to that question and that I would have a fourth answer. They seemed to be discussing the wrong leverage points (Kapor started addressing it when he talked about how affluent the US has become and that technolology is necessary but not sufficient to solve the problems). I would have loved to hear what the panelists would say and think about this New York Times piece on education in Finland.

Create More Value Than You Capture

 

Tim O'Reilly (CC licensed by Pelle Sten)

Tim O'Reilly (CC licensed by Pelle Sten)

Tim O’Reilly was interviewed by Andrew McAfee (writer of Rage against the Machine). It is worthwile to fully quote the introduction to the session:

One of the great failures of any company – for that matter of a capitalist economy – is ecosystem failure. Great companies build great ecosystems, one in which value is created not just for a single company or group of industry players, but for partners who didn’t even exist when the product or service was introduced. Many companies start out creating huge value. Consider Microsoft, whose vision of a computer on every desk and in every home changed the world of computing forever, and created a rich ecosystem for developers. But as Microsoft’s growth stalled, they gradually consumed more and more of the opportunity for themselves, and innovators moved elsewhere, to the Internet. Internet innovators like Google, Amazon, Facebook, and Twitter have also created a rich ecosystem of opportunity, but like Microsoft before them, they are leaving less and less on the table for others. This is a bad trend. Wall Street firms, which got their start trading on behalf of clients, then began trading against them, then created vast Ponzi economies to drain the value from entire segments of the economy are even more dire examples of this trend. But this crisis of capitalism goes beyond individual industry segments. For example, the race by companies to eliminate labor costs has been a short term profit win but a long term loss. Since the cycle of capitalism depends on consumers as well as producers, and consumers are less and less able to find employment, at some point, we’re going to have to start thinking about how to put people to work, rather than how to put them out of work. At O’Reilly, we’ve always tried to live by the slogan “Create more value than you capture.” It’s a great way to build a sustainable business and a sustainable economy.

O’Reilly started off by talking about the banking industry which went from a value-creating industry to a value-destroying industry by wanting to keep more from themselves. He next switched to Microsoft which in its startup days managed to create a true platform on which others could create a massive amount of value. When Microsoft started to try and capture that value for themselves the value creators moved out and onto the web (O’Reilly’s was the first commercial site on the web). The definition of ultimate ecosystem failure is if you take more value out than you create. He says that we are effectively stealing from our grand children.

He observes that very often value creation starts by people having fun and then only later do entrepreneurs come along and start monetizing that value. An example is the make movement. We are only now (seven years into the maker fair) have people turning this movement into serious businesses. He really dislikes the current culture of startups raising money and then going for an exit (“despicable” is the word he used). A lot of these startups see money as gas and see what it is that they do as a journey from gas station to gas station, rather than as creating something that brings value to people. Finding your passion, getting people to believe in it and then try and make a difference is a more sustainable model. Great companies should have big and audacious goals.

The open source movement has had an immense positive impact on the technology ecosystem. These people very often did not make buckets of money, but they did create the infrastructure that all of us are building on top of now. He described to the clothes line paradox: when somebody decides to hang their clothes on the clothes line instead of using the dryer, we don’t just shift some energy use from hydrocarbons to renewables: it just disappears. This is a great metaphor for what is happening on the Internet with open source. MySQL for example “shrunk” the database market, but when you really look at it, it actually grew the market and created a lot of value.

How do you actually measure this type of value and the size of this (free unmeasurable) economy? That is hard. Investors don’t create jobs, customers create jobs. The only reason you need investors is because you cannot keep up with the demand of the customer. Tim O’Reilly is now looking for ways to put labour back into the economy. His first example is the Apple store. Most other retailers have laid off as much staff as possible. Apple has found a new model that works. Walgreens is now trying to do the same with healthcare. Other examples are Kickstarter and Etsy which both are putting labour back into the economy. He thinks we will be doing more of this “added value for eachother”. There is also a whole peer to peer thing happening. If you see a sharing economy it eventually does get monetized, so policy makers can start protecting the future from the past, rather than the past from the future.

Invention & Inspiration: Building a Better World

Dean Kamen, founder of DEKA Research and Development and inventor of the Segway, iBot, an insulin pump and a portable dialysis machine, started by thanking the IEEE as the place in the background that makes sure that things keep on working and told us that ADD is one of his greatest assets.

He talked about three of his projects:

Prosthetics

The Deka Prosthetic Arm

The Deka Prosthetic Arm

He was approached by DARPA who told him that weapons have developed a lot in the last 150 years, but that prosthetics has bare ly developed at all. They challenged Kamen to make a 9 pounds prosthetic arm in two years that would allow somebody to pick up a grape and a raisin from the table and eat it. He thought the assignment was impossible and didn’t really want to take it on. At night he couldn’t sleep and kept rolling around his bed. He then thought: how do you roll around if you don’t have arms, so he decided to take it on. After about 15 months of development tey had their first generation prototype which could be used by somebody to pick up the grape after about 10 hours of training. The second generation of the arm will come out soon.

Water & Power

These are two of the world’s greatest problems. 1.1 billion people in the world lack access to safe drinking water. If we could give clean water, then 50% of all disease in the world go away. 1.6 billion people lack access to electricity. Without access to electricity it is hard to participate in the global modern economy. We are using a 19th century centralized model to distribute water and electricity. We now have different models for distribution. An example is the way that cell phones have taken off from the bottom up.

Water is tough: you need too much infrastructure to get the right amount of filters, chemicals and other solutions to clean the water. Kamen’s idea was to make a box with two hoses. One hose you put in any type of water and out of the other hose come water that is crystal clear and meets all standards for water quality. The box should be small enough to move around and should be able to support one hundred people. Distillation is a process that could work, but that normally takes too much energy. They found a process (a vapour compression distiller) that could re-use a lot of the energy to boil the water. The box needed a little bit of electricity which could be a problem. So they needed another box that could generate electricity: the stirling engine. They trialled these technologies in Bangladesh and in Honduras. The technology is now there, so he needs help to find a way to distribute this globally and get it in every little village. The one product that has a truly global distribution system is Coca Cola (they have over 300.000 in Africa for example). So he is now partenering with them to develop a next generation fountain. He is now challenging coca cola to become the world’s largest healthcare provider.

FIRST

For Inspiration and Recognition of Science and Technology (FIRST) is his project to fix a cultural problem in which we don’t celebrate the things that matter. We are obsessed with sports and entertainment. So he has created a sports inspired set of competitions around science and technology:

Street-Level Genius: An African Maker Safari

Inventive Africa

Inventive Africa

Anita Pyke (Petproject.mobi) moderated a panel with Juliana Rotich (Ushahidi and Afrigadget), Steve Daniels (Makeshift Magazine and writer of Making Do) and John Kidendafor a discussion that was billed as follows:

From bicycle-powered mobile phone chargers to a helicopter built from an old Honda Civic and the remains of a crashed 747, Africa has been producing a unique strain of innovators long before the maker movement started trending in the US. With projects ranging from the practical (DIY biofuel systems), to the whimsical (home-made robots), street-level makers in the most resource-poor communities show time and again that the only essential materials for innovation are ingenuity and ambition.

They started with sharing some examples:

Flood Ready Bike (from Makeshift Magazine)

Flood Ready Bike (from Makeshift Magazine)

The types of environments in which these innovations usually don’t have regulations: often a whitespace area where there isn’t a lot of control. Usually there are many resource constraints driving this type of innovation. All the resources are constanty reused and recycled. On the one hand these informal economies (in Kenya 75% of employment is in the informal economy) allow a space for experimentation, but it also comes with a lot of risks. The speed of adoption is very quick too: if something works, then it is copied fast. Sometimes this inhibits innovation in Kenya, because inventors are afraid that their work will just be copied. The copying problem led to an interesting discussion on intellectual property and how that should be approached in these informal economies. An interesting distinction was the difference between efficiency (making a particular product with as little use of resources as possible) versus resourcefulness (making as much as possible from a limited set of resources).

Ambient Location and the Future of the Interface

Amber Case (CC-licensed by webvisionsevent.jpg

Amber Case (CC-licensed by webvisionsevent)

Amber Case is a founder of Geoloqi and a cyborg anthropologist. Some of the themes that interest her are “ambient intimacy”, “the automatic production of space” (you can put stuff in your computer, but it doesn’t get heavier), “the digital dark age”, “persistent paleontology”, “information jetlag”, her dislike for skeuomorphs and “cellphones as providing temporarily negotiated private space”. According to her we are all cyborgs now. The minute you look at a screen you are in a symbiotic relationship with technology. Most of the tools from the beginning of time were an extension of our physical selves. Right now we are starting to see tools emerging that are extensions of our mental selves. From a fixed interface, we have now moved to liquid interfaces on our screens which can be infinitely configured. What will be the next step in the interface world?

Steve Mann already wore a computer in 1981. He was the first person to lifestream his life. He wrote a great paper titled WearCam, the wearable camera. He worked on the concept of diminished reality where he would cancel out the ads and brands that he didn’t like. One of his issues was how do you type? So the Twiddler,a one-handed USB keyboard, came out. He could get about 90 words a minute with it. He created contextual notification systems for “remember the milk” type of things. He built in face recognition software. He went from 80 pounds of gear in the early 80s to the current situation where he has the information laser projected onto his eye.

The Twiddler

The Twiddler

“Calm technology” was research done at Xerox Parc in the 70s. It is exactly what it says that it is: actions become buttons, there are invisible interfaces and there are trigger-based actions. The haptic compass belt is a great example of calm technology. At Geoloqi they realised that with geo-technology you can now make invisible buttons. So for example your lights will turn on when you enter your geo-fenced house. This will allow your phone to become a remote control for reality. She showed a lot of examples of what you can do with geofencing. One example was mapattack.org.

The conclusion of her talk: The best technology is invisible, gets out of your way and helps you connect to people.