It’s an exciting week to be in Melbourne. The Australian Open is in full flight and yesterday we played our part in helping Jamie host the Montgomery Innovation Summit. Common to both, energy levels are high.
The Summit looks to build a thought leadership platform for US and Australian innovation. Present were both ambassadors, captivating ex-Cisco chief turned presidential advisor and VC John Chambers, Australian superannuation funds (now the 4th largest capital pool globally at $2.3T), half a dozen emerging unicorns including Asapp, Spark Cognition and Dragos, public success stories such as Crowdstrike and Afterpay, along with a great group of family offices and investors. The focus; what lies ahead for the two nations in a world looking to manage an unstoppable transition to Ai, automation and cyber threats.
From the day’s conversations four themes resonated as ones to keep a close eye on as we all look ahead with the benefit of a fresh decade.
- 2020 will be the year of redesigning and reskilling the enterprise.
Data-empowered decisions, Ai as internal platforms and workforce augmentation through automation form some of the competitive tenants of the modern enterprise. Newly emerging corporations have the benefit of designing their company natively to these mandates in an effort to out compete incumbents, while today’s leading enterprises are investing deeply in redesigning processes and reskilling their workforce. The growing drum beat is to disrupt yourself or be disrupted.
Ernst and Young forecasts that with current technology alone 80% of the mining industry workforce will need to be retrained for an increasingly automated and algorithm driven environment. There is mounting urgency towards acting now to win the future of your enterprise. AT&T has announced a $1B investment to retrain a third of its workforce. Seemingly unstoppable Amazon is not feeling secure putting $700M towards reskilling 100,000 of its workers.
For those that transition successfully to a machine driven enterprise the potential to out compete and dominate their industry for the next decade looks incredibly attractive. Especially as far too many will not decisively move in time.
2. The companies and nations most at risk of not innovating in time are those that are currently enjoying success.
Doing the right thing too long will cause you to fall behind. Sage words from ex-Cisco Chairman John Chambers, who built the company into the most valuable corporation of its time by a wide margin.
When discussing the challenges faced by Australia, who has benefited from three decades of uninterrupted economic growth and prosperity, Chambers warns that the greatest need to innovate is when you’re at the top of your game. For in a rapidly changing environment, what brings us success today will not be what delivers us success tomorrow. A notion as true to the enterprise as it is to nation states.
The change is most effective coming from the top down with CEO’s and heads of state laying out the vision, the priority and instilling the culture to experiment and self-innovate.
3. We’re as vulnerable as ever from cyberattacks yet its not from lack of effort.
I don’t believe I’ve ever left a conversation with a cybersecurity expert feeling more secure that when I started. Hearing from Crowdstrike, Dragos and government security officials yesterday left me with that now familiar feeling of anesthetized dread.
All are doing fantastic work in helping secure the corporate landscape and critical infrastructure yet they alone can’t overcome the knowledge gap between what the board or cabinet know and what is out there. It is not a lack of urgency or investment on the part of those in charge rather its a result of the incredibly complex and dynamic environment that they are working within to secure.
State actors remain the big four: Russia, China, Iran and North Korea, yet more are emerging. Each have unique traits based on their objectives. Russian actors typically act more brazenly with a smash and grab mentality and can comprise your network in 18 minutes for monetary gain. The Chinese on the other hand focus on IP theft and don’t wish to leave a trace, taking their time at 4 hours to covertly gain control.
There is no simple fix and the complexity keeps mounting. (cue that familiar unnerving feeling).
4. We’re on path to have two internets as the world polarizes between China and the West.
The Great Firewall of China has been a familiar topic for almost two decades now and yet the more starker notion of two internets feels new. Presenters at the summit shared a common belief in the polarization between China and ‘The West’ resulting in two separate communication and online infrastructures.
The US will face for the first time both a military equal and an economic equal with the arrival of China to end its hegemony. That does not mean the US will cease being a superpower it just means the world will have to make room for two superpowers. And that includes the digital world and space, which will act as the theaters where the battle for influence will play out.
Our former Australian ambassador to the US left us with the remarks of the rise of the authentic nationalist leader. Decisive people of action who act on their beliefs and those of their base rather than playing for the middle ground. Should that prove to continue to define this new decade the path to greater polarization will be a difficult one to turn around.
One thing is for sure, 2020 is already shaping up to be a very interesting year.
Darling Ventures is investing out of its third fund along a core thesis that data intelligence, automation and decentralization are transforming the enterprise, industry and traditional markets. We look to work alongside founders as their first backer and aligned partner, igniting their early journey.