The abundance of cities: April 29, 2018 Snippets
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This week’s theme: an introduction to the critical mass that makes up cities.
Welcome to the start of our Snippets series on cities, where over the next several weeks we’ll be exploring all kinds of fascinating topics, concepts and paradoxes at the heart of urban humanity. Two weeks ago in Snippets, we shared the news of our investment in Urban Footprint, founded by legendary urban planner Peter Calthorpe, and our view that cities represent one of the largest and most important “social networks” that we must get right moving forward:
Reviving our original social networks: cities | Jay Zaveri, Social Capital
The idea of cities as a collection of social minds isn’t new, or even unique to us as people. Humans are not the only species that collects into groups, where the totality of the whole is greater than the sum of its contributing parts. Bees organize into hives, ants into colonies, plants, fungus, insects and microbes into living forests. It’s no coincidence that Social Capital partner’s Arjun Sethi and Andy Artz, writing last year on the evolving nature of social networks, drew heavily from biological examples in their post The Hive is the New Network. Over this series, we’ll look at this phenomenon through many different lenses, and learn to think of cities not as a collection of people and buildings and jobs and services but as a critical mass of human behavior.
These critical masses of human behavior that we call cities can exist at many different scales. From small- to mid-size provincial capitals and one-industry towns up through modern megacities like Tokyo, Beijing and New York, there’s an important urban quality they all hold in common: the elevation of the city-dweller into an individual empowered by the pressing crowd, yet immune to its distractions. The best description of this phenomenon I know comes from E.B. White, in his classic 1949 essay, “Here is New York”:
“New York blends the gift of privacy with the excitement of participation, and better than most dense communities it succeeds at insulating the individual (if he wants it, and almost everybody wants or needs it) against all enormous and violent and wonderful events that are taking place every minute. … Since my arrival, the greatest air show ever staged in all the world took place in town. I didn’t attend and neither did most of the eight million other inhabitants, although they say there was quite a crowd. I didn’t even hear nay planes except a couple of westbound commercial airliners that habitually use this air shaft to fly over. The biggest ocean-going ships on the North Atlantic arrived and departed. I didn’t notice them and neither did most other New Yorkers. … The Lions have been in convention. I have not seen one Lion. A friend of mine saw one and told me about him. (He was lame, and wearing a bolero.) At the ball-grounds and horse parks the greatest sporting spectacles have been enacted. I saw no ballplayer, no race horse. The governor came to town. I heard the siren scream, but that was all there was to that — an eighteen-inch margin again. A man was killed by a falling cornice. I was not a party to the tragedy, and again the inches counted heavily.
I mention these merely to show that New York is peculiarly constructed to absorb almost anything that comes along (whether a thousand-foot liner out of the East or a twenty-thousand man convention out of the West) without inflicting the event on its inhabitants; so that every event is, in a sense, optional, and the inhabitant is in the happy position of being able to choose his spectacle and so conserve his soul. In most metropolises, small and large, the choice is often not with the individual at all. He is thrown to the Lions. The Lions are overwhelming; the event is unavoidable. A cornice falls, and it hits every citizen on the head, every last man in town.
… The quality in New York that insulates its inhabitants from life may simply weaken them as individuals. Perhaps it is healthier to live in a community where, when a cornice falls, you feel the blow; where, when the governor passes, you see at any rate his hat.
I am not defending New York in this regard. Many of its settlers are probably here merely to escape, not face, reality. But whatever it means, it is a rather rare gift, and I believe it has a positive effect on the creative capacities of New Yorkers- for creation is in part merely the business of forgoing the great and small distractions.”
As E.B. White explains rather poetically, the abundance of cities is less a quality of how much is happening inside them, but rather a particular kind of attitude by its dwellers: everything is abundant, therefore everything is optional. This optionality breeds specialization; from that specialization, creativity; from that creativity, the emergent “city-ness” that we identify in urban centers large and small. (In a 2014 study, Luis Bettencourt and his colleagues demonstrated a great example of relative specialization in cities as being scale-agnostic: that quality of “forgoing the great and small distractions” by treating the rest of the city as an abstract being to be tuned out may vary in absolute magnitude between New York and Santa Fe, but its relative character remains intact.)
Professional diversity and the productivity of cities | Bettencourt, Samaniego & Youn, Nature
Creativity, specialization, and the pursuit of new frontiers come not only from what’s around us but also from what we can ignore and take for granted. For those of you who’ve been reading Snippets for a while, this may sound familiar. It’s similar to a concept we explored last year in our series on Abundance: that the concept of abundance is not really about some resource that may be in surplus, but rather about the behavior of consumers as the friction involved in their consumption decision drops to zero.
Understanding Abundance (part 1): it’s caused by consumers | Alex Danco, Social Capital
Next week, we’ll dive back into this idea of abundance, and how cities represent the ultimate expression of a future of newfound abundance, and also emergent scarcity within that abundance. If we want to understand and anticipate our future in a world where energy, data, connectivity, transportation, and whatever else might become abundantly available, our best shot is to study how cities today already represent worlds of abundance, and what paradoxical consequences we see that emerge.
Elsewhere in the world:
China’s challenge to democracy | David Runciman, WSJ
Finland has second thoughts on basic income | Peter S Goodman, NYT
The tweeting of the lambs: inside the life of a modern English shepherd | Sam Knight, The New Yorker
And here in the United States:
Scenes Unseen: the summer of ’78 | Jim Dwyer, NYT
Accelerating transitions in how we make our energy:
How windmills as wide as jumbo jets are making clean energy mainstream | NYT Interactive
First Solar to open new US manufacturing plant | Julia Pyper, GTM
Solar Market insight: 2017 year in review | Solar Energy Industries Association
And how we buy, sell and move it:
A new era of grid planning: “Folks are frustrated” (podcast) | The Energy Gang Podcast
Consumer contenders:
How Anker is beating Apple and Samsung at their own accessory game | Nick Statt, The Verge
Controversial news this week around DNA Ancestry data being used by law enforcement:
The creepy genetics behind the Golden State Killer case | Megan Molteni, Wired
Other reading from around the Internet:
Use and misuse of the OODA loop | Venkatesh Rao, Ribbonfarm
Recommendations versus guidelines | Scott Alexander, Slate Star Codex
Experts say Tesla has repeated car industry mistakes from the 1980s | Timothy B Lee, Ars Technica
In this week’s news and notes from Social Capital team, several members of the team were in New York this past week to attend the Sohn Investment Conference, at which Chamath spoke. If you aren’t familiar with the Sohn conference, it’s a must-watch event for anyone interested in investing: founded in 1995 in memory of Ira Sohn, the non-profit conference invites investors to pitch their best investment ideas for the world while raising money to support medical research. In previous years, Social Capital has presented Amazon, Workday and Tesla as great ideas (and we’re happy to say that over that time period our basket of Sohn picks is handily beating the S&P 500, at 36% annual compounding versus 15% respectively.)
So what about this year? This year, Chamath’s presentation tackled a big question that’s looming over many of our minds: we all know that Artificial Intelligence is going to be a big deal, but what is the best way to bet on it from a value creation perspective? Where should we be looking for businesses that are quietly building that future, in plain sight? Chamath shares what we believe to be the answer, and it’s a familiar face:
Chamath Palihapitiya speaks at the Sohn conference (video)
“How do enterprises take advantage of AI? The first thing they need to do, as we learned in the past, is organize their information. Take it, and stick it into some training algorithms to create a model. But the problem is that all of this data is in a very unstructured way. It doesn’t exist in a neatly organized model. There aren’t labels, there aren’t things that classify this stuff. These are Excel spreadsheets, these are Word documents, these are Powerpoint decks. And so you need an organizing layer who can take all of this chaos and make some sanity out of it.
And there is. And so we get to our 2018 pick for Ira Sohn, which is Box.
So why Box? For a bunch of reasons. The first and foremost is that they sit on top of an enormous amount of R&D that [Google, Amazon and Microsoft] are already doing. In fact, if you look under the hood at how much R&D spend is being spent last year alone, it’s almost 45 billion dollars. And these buys benefit from this enormous tailwind. And they do three very simple basic applications with all of this infrastructure that’s been built for them. They give companies the ability to add intelligence to imagery, to audio and to video. And so what does that mean, to do that?
Well, imagine you go into a hospital, and millions and millions of X-rays have been pre-classified. They know the difference between a malignant and a non-malignant tumour are. They know what’s a nodule versus a tumour. They can tell you very discretely what’s a blockage and what’s not. Those are machines, trained to make these decisions, with the participation of great doctors. Imagine now you call to get an insurance policy. Instead of weeks spent applying over the phone, all of that is automatically created in an application that’s translated into a computer, the decision is made and your policy is created. So you take audio, and all of a sudden it exist in contextualized, structured data. Or imagine the ability to take any running video. Identify people, identify themes, identify things that have been said, anomalies. And you see how there is just this wide, wide number of ways in which we believe Box can generate an enormous amount of value over the next few years.
… The stage has been set for a great product with a great customer base who are now ready to adopt all the AI capabilities that all of these enormous companies have created and now made available: through the interface layer of organizations like Box.”
Speaking of artificial intelligence applications in business, another member of the Social Capital family had a big product launch this past week: Intercom’s new Business Messenger. While Box is a fantastic tool for organizing all of your internal workplace documents and information into structured data, customer interactions require a different approach, and that’s where Intercom comes in. When we think about businesses adopting AI capabilities through interface layers that sit on top of the incredible R&D work that’s being done by the large AI platform companies, Intercom is another great example of a company whose hard work is reflected and amplified through the success of all of the companies who use them.
A new dawn for the Business Messenger | Paul Adams, Intercom VP of Product
Intercom’s Business Messenger goes a full leap beyond the existing path through which customer-facing messengers have evolved to serve the needs of customers and the team members who help them. After all, interacting with customers is much more than just talking. Think about the ability to share links to other work tools: it gives you insight into what customers are actually trying to do, like book meetings, arrange video conference calls, share announcements, and even help customers of their own. It was pretty clear to the Intercom team that Business Messengers needed to be designed very differently from personal messengers we use like WeChat and iMessage: they need a home screen, they need hteir own App Store; they need so much more. And when that happens, everyone involved can benefit in many new ways, and the existence of structured, organized conversation as a basis for inference, machine intelligence and greater clarity into the customer relationship will only get stronger. If your business uses Intercom (and if you don’t, maybe you should?), you can get started here.
Both Intercom and Box have great blogs that they keep updated regularly with new products, tips, and other ways where users and prospective users might find great new productive ways to use them. They’re also both always hiring: you can reach Intercom’s current career postings here, and postings for Box here.
Have a great week,
Alex & the team from Social Capital
