Buzzword Bingo — Greenwashing in Tech
Almost no other industry is as driven and characterized by buzzwords as the technology sector. Our Singularity Think Tank fellows are there to help us maneuver linguistic traps and false perception.
Buzzwords are hated as much as they are loved. Sometimes, they are banks’ and asset managers’ fast track to clients’ attention, other times, they are the media-inspired way to investors’ most regretted mistakes. They grab attention, yet they were invented to simplify. They are superficial by design and in some cases misleading. We use buzzwords, too, but we never stop there. For us, they are the starting point to understanding value chains and exploring value generation. This is where investing begins and betting ends. Our Singularity Think Tank members are crucial in helping us pick out the signals in all the noise. They provide us with a sharper lens to look beyond — or better through — buzzwords. Here are a few examples.
3D Printing
We recently conducted a call with our Singularity Think Tank member Agnes Petit who is the founder and CEO of Mobbot. “What people assume we do, differs from what we actually do: we build robots and automation software to spray concrete.” The word “3D Printing” makes her business relatable, but also paints an inaccurate picture in peoples’ minds. “They think we run gigantic printers that spit out whole buildings.” In fact, Mobbot has a transformative new technology to offer, particularly in times when construction processes need to be adjusted for recyclable materials, on-site, fast production, as well as the reduction of overall material consumption — the pillars to net zero goals across industries.
“In the end, it’s additive manufacturing that is automated and consumer-friendly.” 3D printing in Mobbot’s case consists of different components, it’s a combination of process automation and hardware, material engineering, and design. All three benefit from an evolution and convergence in technologies like Robotics, AI, and Advanced Materials. Potential fields of application are immeasurable: from prosthetics to food, and all types of other consumer goods, the list is long. “10 years ago, 3D Printing meant printing plastic. Today, any material mixed with the right additive or glue can potentially be 3D printed — from wood to cotton or even soil.” 3D Printing as a term fails most business models. In the end, it’s a new method of (more sustainable) product engineering — that enables a new value chain and circular economy. It’s more than a product, it’s a way to think and build differently. Capturing all developments in this field across industries needs a dissection of the buzzword into the components that hold it together.
Virtual Reality
When we spoke to another Think Tank fellow, Lukas Schleuniger, a similar notion came up. “When the public and investors think about Virtual Reality (VR), all they picture is headsets”, he says. “VR is actually anything that simulates and depicts the environment we live in as realistically as possible — and this can happen on a screen as well.” From gaming to collaboration applications in fields such as maintenance, facility management, or warehouse logistics, and design — the actual use cases exceed the immersive headset experience. Software that helps create realistic experiences is as important within the value chain as are semiconductors and related compute power. The hardware headset is just one piece of a very complex puzzle. It has become the symbol for a much more diverse and multi-layered industry. To us at TSG, VR represents the human quest to create a parallel universe as close to reality as possible — be it to unleash fantasies for entertainment or interaction, to augment what’s already possible in real life, or for purposes we only just begin to fathom.
Artificial Intelligence
Alexander Stumpfegger, our Artificial Intelligence (AI) expert in the Think Tank, fights a similar battle. “AI is still widely seen as a threat. In peoples’ minds it means robots and machines turning against their creators or AI taking away jobs”, he explains. “The truth is that AI is everywhere and everyone uses it unknowingly on a daily basis: almost every application in your phone benefits from it, the programs on your computer, the smart gadgets at home.” AI has become essential in everyday life. Spotify’s algorithms have improved millions of playlists, Netflix’s recommendation mechanism has led to a phenomenon called “binge watching”, and some people converse more with Apple’s Siri than with actual humans.
AI plays a big part in advertising, supply chain optimization, in business intelligence, business process automation, decision making support, cyber security, and even in software development. E.g. AI-fueled Knowledge Graphs have opened up a whole new world in understanding processes, systems, and the relations between different players within them. “AI has revolutionized business processes and continues to do so. When working with clients, that’s where they begin to see the vast opportunities AI brings to the table for their businesses“, Stumpfegger explains. “It’s anything but a threat, it’s a tool to enhance human qualities, make them more efficient, and use technology where humans are more likely to fail”, he adds.
Speaking of VR and AI, one application hard to place is that of online gaming: It’s broadly accepted as a VR topic in the land of theme funds and ETFs. Our experts’ take here is that longer term, it is an application greatly influenced by several base technologies, currently though, much stronger fuelled by new AI capabilities with little touchpoints in what’s expected to be ‘VR’. “For making games more realistic, creating a more thrilling experience, and to flawlessly embed advertising within the games, AI is the key driver in this sector”, Stumpfegger concludes. At TSG, these worries are no more. Thinking out of the box for us means to be free from stereotypes and categorizations. Our expertise is understanding the evolution of base technologies and their applicability in industries. With this approach, our portfolios are as buzzword-agnostic as they are theme-agnostic: when it happens, we will be positioned. “When technologies converge to create new things, it’s hard and dangerous to follow single themes and single tech approaches”, says The Singularity Group CEO Evelyne Pflugi.”You’ll most likely miss out.”
When time is scarce and information is not, there’s much at stake
What these examples show is that buzzwords alone are bad advisors. The decision-making challenge investors have when time is scarce and information is not, poses an underappreciated threat to the success of any system and to many portfolios’ returns. Not all founders are as honest as Agnes, not all pitchbooks apply the right buzzwords, and not all business models keep up to the promise they initially seem to make. Many of them are no more than much noise in an oversupplied market. While investors have slowly become used to double-checking wrong labels and to detecting greenwashing when it comes to ESG and sustainability, only few have realized that the same applies to technology terms. Literally.
