Making the Internet great again
Some thoughts on our attitude towards data and potential windows of opportunity for visionary entrepreneurs.
Monopolies have been built upon our data — the internet is broken
The Internet was supposed to be a place of creativity, freedom and endless possibilities. No individual or company was supposed to own it and anyone was invited to participate. And yet, along the way, many of these values have somehow become lost.
What we are facing now is a gigantic, global tech economy dominated by monopolies that built their wealth on user data that they alone have access to. The data is locked in silos. It is often traded behind our backs and gets monetized repeatedly — anything from location data, social status and interactions, performance levels in our jobs, political attitudes all the way to sexual preferences, number of km walked per day, to our heart rates. And while everybody is transparent, private companies are mining the data we create. Most people don’t realize that the revolution of the internet is taking place behind rather than in front of their screens.
You are your data. Trouble is, that identity is now yours, but the data that comes from its interaction in the world is owned by someone else.” — Carlos Moreira, Sept. 3, 2015
The unfair allocation of wealth derived from user data will get worse
Disruptive technologies such as connected devices, machine learning or quantum computing will change the world — maybe even more as the first waves of innovation (internet, social, mobile) did so far. Data is the oil running all of these systems, it’s kind of the glue connecting everything. With new disruptive technologies in place humanity will solve a lot of its problems. On the other hand, our world’s complexity leaves the majority of people behind, what leads to political events such as Brexit or the election of Donald Trump. The following technologies will make our world even more complex, yes. The solution of complex problems might often require complex solutions: Welcome to the hardtech era.
Those are the technological pillars that will enable rapid innovation in all imaginable fields and beyond. They are all interrelated and heavily influence each other (convergence). The Internet of things will increase the amount of mined and monetized data. Think of thousands of new sensors measuring the world and every aspect of human life — smart homes, connected cars or wearables are paving this way.
The massive amounts of data collected need to be processed. Quantum computers offer the necessary hardware infrastructure to make the real-time processing of complex data much faster. Adding to this, machine learning algorithms will make almost (!) perfect decisions and predictions based on such data. If quantum computers are the brain, machine learning is the mind. We will be able to predict traffic, many kinds of human behavior or can provide precise health checks, diagnosis or build autonomous vehicles and robots to support (or replace) us in our everyday life. All of the mentioned domains are pretty much dominated by the tech giants since they are owning the relevant datasets as well as the technological infrastructure (e.g. machine learning frameworks). Nevertheless, they will be integrated into future business models and can be understood as a horizontal technological layer allowing entrepreneurs to build better business models on top of them. Every digital company will use machine learning in the future.
Repairing the internet by opening data silos and letting people participate in wealth creation
Machine learning algorithms need to be fed with data in order to unfold their potential. The tech giants are trying to a) mine more data through new products / sensors and b) get existing datasets from yet closed data silos. Especially b) offers huge windows of opportunity. Especially in old economies (e.g. banks, insurance, logistics, construction work) legacy systems are still in place keeping the data locked. Modern organizations often use tons of different tools within each and every department in order to keep up the pace of innovation. For example the marketing, sales or HR tech stack has grown incredibly and there is a strong trend towards preferring “best of breed” solutions over fully integrated products in order to stay flexible. In the future I expect those tools to be connected — also inter department and in certain cases inter company. What we need are companies that enable the free flow of data. First but small steps in that direction have been undertaken by :
The rise of APIs
APIs are one approach to make data more accessible. I think we are still at the very beginning. Integrations need to be faster, deeper, easier to implement and to maintain. API connectors are an exciting playground for entrepreneurs and VCs from my perspective.
Blockchain enabled flow of data: a decentralized data marketplace
In the past monopolies have been built upon user data. More data will be gathered and processed in the next decades, resulting in even bigger benefits for still very few people. We need to address this problem and make more people benefit from their data driving the tech economy. One small piece of the gigantic puzzle could be the establishment of a decentralized data marketplace: self sovereign data ownership for everybody. Blockchain is the technology making digital goods track- and traceable, “unique” so to say, what is also true for flows of data.
My colleague Lawrence Lundy from Outlier Ventures described this marketplace as a “killer business model” and commented:
“A blockchain-based data marketplace helps to solve two major problems in artificial intelligence today, the access to data for those that need it, and monetizing unused data for those that have it.”
I couldn’t agree more. The benefits for consumers, companies and societies as a whole cannot be underestimated. A concrete picture of how such a marketplace could look like was described by Don and Alex Tapscott in their book Blockchain Revolution.
What if “the virtual you” was in fact owned by you — your personal avatar — and “lived” in the black box of your identity so that you could monetize your data stream and reveal only what you needed to, when asserting a particular right. (…) Imagine a new era of the Internet where your personal avatar manages and protects the contents of your black box. This trusty software servant could release only the required detail or amount for each situation and at the same time whisk up your data crumbs as you navigate the digital world.
— Don & Alex Tapscott in their awesome book Blockchain Revolution
Personally, I deeply believe that self sovereign data ownership and a free flow of data would make the world a better place. As a VC I’d love to back founders pursuing this goal with a strong, underlying business model.
Please like the post if you share this vision and do spread the word. Please feel free to reach out at any time.
