Stargate Fund

Secrets of longevity for organizations and humans

Here I explore long-lived concepts, ideas, and books that helped generations of scientists and makers to build our world, but were abandoned in the era of shortsightedness and immediate gratitude.

— Joseph Konrad

  • Why positive feedback loops are essential for success

    What fascinates me in a feedback loop mechanism is its great power of change that can turn life for better or worse. Imagine a good friend or a total stranger that once said you encouraging words at the exact time when you wanted to hear them. If the person you heard it from has enough status or just a little more trust from you, even something old-hat like “I think you will become a great man, don’t listen to what others say” could positively drive you all your life.

    A key lesson of feedback loops is that things are connected—changing one variable in a system will affect other variables in that system and other systems. There are two types of feedback loops: positive and negative. Positive feedback amplifies system output, resulting in growth or decline. Negative feedback dampers output stabilizes the system around an equilibrium point.

    Thomas Goetz from Wired wrote:

    “ …So feedback loops work. Why? Why does putting our own data in front of us somehow compel us to act? In part, it’s that feedback taps into something core to the human experience, even to our biological origins. Like any organism, humans are self-regulating creatures, with a multitude of systems working to achieve homeostasis. Evolution itself, after all, is a feedback loop, albeit one so elongated as to be imperceptible by an individual. Feedback loops are how we learn, whether we call it trial and error or course correction. In so many areas of life, we succeed when we have some sense of where we stand and some evaluation of our progress. Indeed, we tend to crave this sort of information; it’s something we viscerally want to know, good or bad. As Stanford’s Bandura put it, “People are proactive, aspiring organisms.” Feedback taps into those aspirations.”

    Understanding the feedback loops helps to choose right between the goals and the process, short-term and a long-term focus. When you set a goal, you could achieve the desired outcome and get a reward, or you could fail and fall into self-doubt, also nobody talks about the nervousness of the hours and days of self-measurement and crunching on the indicators that change every minute. When the process and feel of the energy spent in a moment are only tracks you are on, the outside world has not much to do with your success.

    The most successful writers, podcasters, and entertainers focused on the long-term, and as life stories of the most creative individuals show, success will come when you are about to forget you waiting for it.

  • Why mental models help you thrive as a founder

    When a picture of the world doesn’t comply with the picture in your head, probably your mental models are wrong and need to be updated. This picture in the head is a mental model that helps you put complex knowledge or situation in a simple form. A good example is social interaction. Mental models are how we understand the world. Not only do they shape what we think and how we understand but they shape the connections and opportunities that we see.

    When we meet someone, we recall specific knowledge about how both of us should behave in order to lead the situation to a positive outcome. When someone starts behaving differently, we get puzzled and don’t know what actions are appropriate, what words should be said. Our simplified model of the social situation doesn’t work or wasn’t worked at all, we just noticed it too late.

    We should carry as many models as we could to be prepared to deal with unexpected things in our life, however, most of us are specialists with a few for every occasion. We need to see as engineers and biologists, businessmen, and psychologists, instead, we’re only looking at the problem one way, we’ve got a blind spot.

    In a famous speech in the 1990s, Charlie Munger summed up the approach to practical wisdom through understanding mental models by saying: “Well, the first rule is that you can’t really know anything if you just remember isolated facts and try and bang ’em back. If the facts don’t hang together on a latticework of theory, you don’t have them in a usable form. You’ve got to have models in your head. And you’ve got to array your experience both vicarious and direct on this latticework of models. You may have noticed students who just try to remember and pound back what is remembered. Well, they fail in school and in life. You’ve got to hang experience on a latticework of models in your head.”

  • The future belongs to steward ownership

    There’s a bus company that drives from one of the big cities to my parent’s town, one of these private minibus companies started by pops and moms, call it the Family Express.

    Because a business exists for more than a decade with non-stop transit services during the holidays and on -30 degrees Celsius winter days, drivers of the Family Express do know most of the passengers in a face and almost by name. You could drive all the way in your car, or you could choose a government transportation service, but what you couldn’t find somewhere else is extreme steward ownership shown by the Family Express employee and founders.

    They know their customers, they live with their customers, and they do everything to help and provide a huge value within their business. And we need more of it.

    Let me explain why.

    When I talk about the need for more founder-managed companies and the deficit of owners, I mean the gap between responsibility and accountability taken by the founders and investors.

    Our laws today define ownership not as a responsibility, but as an investment and a tool for generating personal wealth. I’m not fighting the idea of being rich, just today’s meaning of being an owner needs to be upgraded with more value.

    There is the starting point when the founder decides not to make a successful company, not care about the employee, not benefit their community, but to go straight to the Shark Tank Boiler and get a VC on board. They haven’t yet recognized the idea of dependence from their quarterly reports to investors and high-pressure profiteering notions out there.

    To the majority of the tech community, this is a no-brainer: simply raise venture capital! VC is known for loving bold, humanitarian visions, and a startup with the mission to reinvent transportation or books should be a great fit, right? Why not just raise a couple of million dollars to boldly build the greatest badass experience out there?

    The thing that worries most is that previously owner-managed and family businesses are being stripped of their owners – and their stewardship. Owners that are controlled by the profit rat race rarely understand how profit return requirements impact consumers or employees. 

    For example, while owner-managed companies often retain employees during economic crises, investor-driven companies and managers of publicly traded companies, who are responsible for producing quarterly reports, often let employees go to improve their short-term bottom-lines. The consequences felt by the companies themselves are only one side of the problem.

    Economically, the disappearance of real, independent ownership is a dangerous phenomenon: More and more companies are being bought by large corporations, which has led to an unprecedented trend towards market centralization. The United States alone has lost half of its companies in the last 20 years according to a study by Cornell University. On average, companies today are three times as large as they were in 1970. Market centralization at this scale undermines our economic system, which is meant to be based on diversity, competition, and a decentralized market.

    Steward-ownership is more than a fancy name for being extremely responsible for something, it’s an alternative to conventional ownership that permanently secures a company mission and independence in its legal DNA.

    Solutions for steward ownership have been found by generations of entrepreneurs all over the world. These pioneers have found innovative ways of committing their businesses to two key principles: profits serve purpose and self-governance.

    These principles enable companies to remain independent, purpose-driven, and values-led over the long term. Often structured as foundations or trust-owned companies, steward-owned companies historically have been broadly successful.

    Some are old companies, like Zeiss, whose foundation ownership has preserved its independence for more than 120 years. Some are new companies, like Sharetribe. Others are large, like Bosch, while some are small, like Ecosia. What they all have in common is a radically different approach to corporate ownership.

    Not only do they outperform traditional for-profit companies in long-term profit margins, but they are also more resilient to financial and political crises, and offer significantly less volatile returns. Compared to conventionally owned companies, steward-owned companies also pay employees higher wages with better benefits, attract and retain talent more effectively, and are less likely to reduce staff during financial downturns.

    Steward-ownership structurally retools who holds control in companies and what motivates decisions. By disrupting the relationship between power/money and the purpose of business, steward-ownership is a powerful agent for economic change and a future decentralized economy where we have more independent producers than passive consumers.

  • Phoenix cities of tomorrow

    Working for the advancement of weapons, robotics, medical equipment, aeronautics, genetics, pharmaceuticals, communications, energy, transportation, and entertainment technology, residents should persuade and encourage the creation and running of the novel community.

    Most of the many and very ambitious today’s cities lay claim to a certain perfection in different ways. But the actual state of things shows that they are failing. Protests and pandemics have locked down cities, urban business centers, suburban malls, and public spaces transformed into ghost towns. These are not the first time cities became the shadow of divine power, but the first time when most of us are aware of it.

    Places, where we live, could adapt only if we become lean citizens and start treating urban territories as lean city projects.

    Cities in the global are continuing to grow as a result of inward rural migration. One of the most pressing questions that urban planners face now is the apparent tension between density — the push towards cities becoming more concentrated, which is seen as essential to improving environmental sustainability — and disaggregation.

    We could wonder if repopulation from the metropolis to the smaller communities will be a smarter solution to more sustainable living. Seems like renewed focus on finding design solutions for wider neighborhoods that enable people to socialize without being packed “sardine-like” is the new gold rush for the next generation.

    Our mayors, governors, and community leaders could take isolation, economic depression, social distancing, and remote working and turn it into a cause for the future of urban paradise. Or at least they could make it suitable for homeless people to survive.

    I was materially lucky not because I was born with a lot of money, I was materially lucky because people let me sleep on their floors. Believe me, we don’t have enough skilled people who want to work and places for bastards to sleep.

    In the early 1960s, Walt Disney believed that hectic, disorganized, dirty, and crime-ridden communities perhaps could be rebuilt in places such as Ebenezer Howard’s Garden Cities of Tomorrow.

    In his book, Ebenezer Howard proposed the founding of garden cities, each a self-sufficient entity — not a dormitory suburb — of a 30,000 population, and each ring by an agricultural belt unavailable to builders.

    Howard was attempting to reverse the large-scale migration of people from rural areas and small towns to cities, which were becoming overpopulated. The garden cities were intended to provide heretofore rural districts with the economic opportunities and the amenities of large industrial cities.

    Known as EPCOT, Disney’s idea included an urban city center, residential areas, churches, schools, and a series of mass transportation systems that would connect the community. It was to have been built in the shape of a circle with businesses and commercial areas at its center with community buildings, schools, and recreational complexes around it while residential neighborhoods would line the perimeter.

    Disney showed what the city would look like and how it would work. The embryo of an idea grew to become the Disney Discovery park — 305 acres of attractions, shows, interactive presentations, dining, shopping, and architectural wonders.

    Disney manifested his ideal community in the last video, right before he died.

    “It (EPCOT) will be a community of tomorrow that will never be completed but will always be introducing, and testing, and demonstrating new materials and new systems. And EPCOT will always be a showcase to the world of the ingenuity and imagination of American free enterprise.

    I don’t believe there is a challenge anywhere in the world that’s more important to people everywhere than finding solutions to the problems of our cities.”

    Some imagination, fortunately, comes true and Singapore is often cited as a real-life EPCOT country. William Gibson described Singapore as “Disneyland with the death penalty” in an article for Wired in 1993, due to its high degree of city planning and clean and orderly lifestyle.

    The declining cost of distance is likely to accelerate as a result of the coronavirus crisis. The implications for big cities are immense. If proximity to one’s job is no longer a significant factor in deciding where to live, for example, then the appeal of the suburbs wanes; we could be heading towards a world in which existing city centers and far-flung new villages rise in prominence, while traditional commuter belts fade away.

    The role cities like Disneys’, attempts to fulfill: to make its money and retain its influence while building a brighter, if perhaps in moments scarier future, one in which industrial companies are encouraged to come up with their best ideas in technology so that those ideas could be continuously demonstrated in the city.

    Knowledge is what I want to point at. Absolute knowledge focused in small cities gives the power of terror but also the power of creation because knowledge makes people into another kind.

    Why phoenix cities of tomorrow? Because this is not a story about death, but a story about hubris, self-realization, and self-recreation. It is a story about doing what past generations have always done, picking at the threads of past mistakes and turning over those rocks, and seeing what miracles we can make in the wreckage of what has gone before, without scribbling over the past.

    Cities’ concentration of people and economic activity — which serves as the driving force for innovation and economic growth — could adapt to every unpredicted event effect.

    For it to be possible to change the world, a great many individuals must believe that it is possible. Unforeseen consequences of today’s events make us think about genuine psychological, social, and economic changes, as well as want of serious justice, equality, and liberty. We never stop looking for the idea of a perfect utopia, though we are doomed to find something now or later.

  • Selling the future

    Mike Maples once said that you shouldn’t think about a startup… as a startup, it’s more insight, an idea about the specific behavior of the people in the future. While a team secretly pivots a product, they have all the advantages of living in the future they create. And most of the successful projects don’t predict some fairy-like gadgets with unreal science behind them (but some of them do), behind every interesting tech company, there’s a powerful insight about human psychology.

    The future is not like the weather. It doesn’t just happen. People make the future. It’s not a destiny or hope; it’s a decision. Steve Jobs didn’t “discover” a market need for smartphones or tablets, he designed the category and taught us how to think about it. Elon Musk did the same with electric cars and commercial space travel.

    One method to come up with a big, bold, radical idea is to implant yourself in the future and think about how people’s lives and needs might be different. Anticipating the needs of tomorrow is one of the best ways to come up with startup ideas today.

    At the 1986 famous seminar Dr. Richard W. Hamming, a retired Bell Labs scientist, gave an intriguing and stimulating talk about the work scientists should do to sell their breakthrough to society. This talk centered on Hamming’s observations and research on the question “Why do so few scientists make significant contributions and so many are forgotten in the long run?”. From his more than forty years of experience, thirty of which were at Bell Laboratories, he has made several direct observations, asked very pointed questions of scientists about what, how, and why they did things, studied the lives of great scientists, and great contributions, and has done introspection and studied theories of creativity.

    In his talk, Humming summarised the whole idea by saying:
    “I have now come down to a very distasteful topic; it is not sufficient to do a job, you have to sell it. “Selling” to a scientist is an awkward thing to do. It’s very ugly; you shouldn’t have to do it. The world is supposed to be waiting, and when you do something great, they should rush out and welcome it. But the fact is everyone is busy with their own work. You must present it so well that they will set aside what they are doing, look at what you’ve done, read it, and come back and say, “Yes, that was good.” I suggest that when you open a journal, as you turn the pages, you ask why you read some articles and not others. You had better write your report so when it is published in the Physical Review, or wherever else you want it, as the readers are turning the pages they won’t just turn your pages but they will stop and read yours. If they don’t stop and read it, you won’t get credit.

    There are three things you have to do in selling. You have to learn to write clearly and well so that people will read it, you must learn to give reasonably formal talks, and you also must learn to give informal talks. We had a lot of so-called `back room scientists.’ At a conference, they would keep quiet. Three weeks later after a decision was made they filed a report saying why you should do so and so. Well, it was too late. They would not stand upright in the middle of a hot conference, in the middle of the activity, and say, “We should do this for these reasons.” You need to master that form of communication as well as prepare speeches.

    When I first started, I got practically physically ill while giving a speech, and I was very, very nervous. I realized I either had to learn to give speeches smoothly or I would essentially partially cripple my whole career. The first time IBM asked me to give a speech in New York one evening, I decided I was going to give a really good speech, a speech that was wanted, not a technical one but a broad one, and at the end, if they liked it, I’d quietly say, “Any time you want one I’ll come in and give you one.” As a result, I got a great deal of practice giving speeches to a limited audience and I got over being afraid. Furthermore, I could also then study what methods were effective and what was ineffective.

    While going to meetings I had already been studying why some papers are remembered and most are not. The technical person wants to give a highly limited technical talk. Most of the time the audience wants a broad general talk and wants much more survey and background than the speaker is willing to give. As a result, many talks are ineffective. The speaker names a topic and suddenly plunges into the details he’s solved. Few people in the audience may follow. You should paint a general picture to say why it’s important, and then slowly give a sketch of what was done. Then a larger number of people will say, “Yes, Joe has done that,” or “Mary has done that; I really see where it is; yes, Mary really gave a good talk; I understand what Mary has done.” The tendency is to give a highly restricted, safe talk; this is usually ineffective. Furthermore, many talks are filled with far too much information. So I say this idea of selling is obvious.”

    Obviously, the selling of the research applies to the startup vision and product more than teams actually use it. For that paranoid who are stuck in a notion that someone could steal their idea while they are training to pitch or while they are selling, and that someone is a dorm room neighbor, my advice is just this, keep sleeping calm, and he probably couldn’t grasp the whole plan you already iterated many times. If this is another big company with abundant resources, you could already be doomed, therefore, just keep digging and get as many useful experiences as you can. Maybe you are just fixed in a state of analysis-paralysis and the focus should be on the customers that adore your company’s product over any substitute.