Thinkers50 Radar 2022: Azeem Azhar

Azeem Azhar is the creator of Exponential View, a newsletter on the intersection of technology, business and society, and an active investor. Previously he founded a number of technology startups. Azeem began his career as a journalist and has an MA in PPE from Oxford University.

On Tuesday, 1 March 2022, Stuart Crainer and Des Dearlove had Azeem Azhar on as a guest in a new session of the Thinkers50 Radar 2022 LinkedIn Live series in partnership with Deloitte.

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In his book, Exponential: How to Bridge the Gap Between Technology and Society, Azeem explains in detail the “exponential gap” between new technology and human society, how technology can be harnessed, and how that gap can be bridged.

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Transcript

Des Dearlove:

Hello, welcome to the Thinkers50 Radar 2022 series, brought you with LinkedIn Live. I’m Des Dearlove —

Stuart Crainer:

And I’m Stuart Crainer. And we are the founders of Thinkers50, the world’s most reliable resource for identifying ranking and sharing the leading management ideas of our age, ideas that make a real difference in the world.

Des Dearlove:

Our belief in the power of ideas and new ways of thinking has been the foundation of our work since we launched the first ever global ranking of management thinkers in 2001. We’ve published a new Thinkers50 ranking every two years since, and it remains the premier ranking of its kind.

Stuart Crainer:

Every January, we also publish the Thinkers50 Radar list, 30 rising stars in the world of management and business thinking, the 30 up and coming business thinkers to watch in the coming months.

Des Dearlove:

So in this series of webinars, we want to showcase some of those ideas and some of those thinkers to bring you the new voices of management thinking.

Stuart Crainer:

Our guest today is Azeem Azhar. Azeem is a serial entrepreneur and investor. He’s the creator of the Exponential View, Britain’s leading platform in depth tech analysis. His weekly newsletter is read by 200,000 people from around the world. And his chart topping podcast is distributed by Harbor Business Review and has featured guests, including Reed Hoffman, and Tony Blair.

Des Dearlove:

Azeem is also the author of Exponential: How To Bridge The Gap Between Technology and Society, which is published by Random House Business. In it, he discusses an exponential gap between the power of new technology and human’s ability to keep up, including the inability of states to deal with new forms of cyber warfare. So it couldn’t be more relevant or more prescient than it is right now.

Stuart Crainer:

We want to use the chat function to make the session as interactive as possible. So please share where you are joining us from today, and please post your questions as we go along. Azeem, welcome.

Azeem Azhar:

Ah, here I am.

Des Dearlove:

There you are.

Azeem Azhar:

Hello. Thank you, Stuart. Thank you, Des. Real pleasure to be here.

Stuart Crainer:

A mass master of technology from the start. Let’s talk about the gap you talk about in Exponential. What is it and how big is it and is it getting wider?

Azeem Azhar:

Well, yeah, I mean, the gap is essentially a consequence of the speed with which this a new set of technologies are developing and the rate with which the everyday institutions we use to make life manageable can adapt. And I guess the simplest example that probably many of us, especially if we have teenage kids, can relate to is, there’s a sort of institution, a kind of common behavior about what happens at dinnertime, which is, we sit at dinner, we have our food and we chat. And about six or seven years ago, smartphones became ubiquitous and our teenagers started to get them. And, and so you now have this super computer which can access the world’s information and show you pictures of funny cats and so on, in the hand of the teenager at dinner.

Azeem Azhar:

The institution says, you sit and you chat. The smartphone says, well, you can look at your smartphone and actually be chatting to your friends who are stuck with their parents in that physical environment. That is a simple example of the gap. What are the norms around that? Now, of course, it’s kind of trivial, which it’s a pain that many of us have felt with teenage kids, but imagine magnifying that up to what it is to be an employee in a company, what it is to be a regulator, looking at what could be monopolistic market abuse, what it is to be in the defense department of a large country, trying to figure out where the threats are going to come from and how you protect yourself against them. And so that gap, it emerges because the potentials of the technology are running away from us and we’re just a little bit slow to adapt.

Des Dearlove:

And is there any kind of… I mean, is that just a kind of a force of nature that we just have to learn to live with? I mean, or is there something we can do to close that gap?

Azeem Azhar:

Well I think that’s a really, really great question. There are two aspects of the gap, right? One is the speed of which technology accelerates and the direction in which it goes. And the second is the way in which we organize our institutions to make them adaptable to change. So there are two different things, I think levers that one can pull. On the first, which is the velocity, so the speed and the direction of the technology. I think that we can, we being members of society, business leaders, employees, investors, politicians, policy people, academics, whatever it is we do, we can shape the direction of the technologies, the ways in which they come to market and what they actually do and what we prioritize. And I can give some really interesting examples around that. I’m not sure we can do much about the speed with which they develop. I think that is sort of baked into the economy for other reasons.

Azeem Azhar:

And then the second part of that gap is, how fast can our institutions adapt? Now, it’s really important that institutions be resilient and be stable because we can’t have them as ephemera and crazes. They can’t change like the hairstyle of a 15 year old emo goth in high school. You need to know that when you get out of your house and you drive on the road, that you drive on the side that you drove on the day before, that it hasn’t just changed with the swing of a new TikTok video. But despite all of that, they need to be able to adjust and have a sense of agility and flexibility for what is inevitably going to be moments of really, really rapid change.

Azeem Azhar:

And so the question is, what do you do with institutions to give them that sense of flexibility as well as resilience at the same time? If you don’t, by the way, what happens is that they tend to be a little bit sluggish and then can suddenly turn on a dime if there’s something existential at them. And I think we can look at the change in German foreign policy this week as an example of a sluggish institution that can change its mind very quickly. But you don’t want adjustments to happen like that. You want them to be a little bit more ongoing, a bit more flexible

Stuart Crainer:

Hasn’t there always been a gap between technological advancement and our institutions. I mean, looking back historically, the industrial revolution for instance, there must have been a huge gap then in between our institutions and the technological possibilities.

Azeem Azhar:

Yeah. I mean, I think that’s absolutely the nature of technology because what technology does is, fundamentally it drives down the price of doing something. And so, as it drives down the price of doing something, things that you couldn’t afford to do become affordable, and that either means more people can do them, or they can do new things. And that changes the assumptions that we’ve had in the past. The printing press was a really good example in the 15th century because it changed the nature of access to knowledge and with ramifications that were felt for hundreds of years afterwards. And I think the 19th century is really interesting to look at as well, because what we saw was a really, really rapid industrialization. And there’s sort of apocryphal stories about the Luddites, not liking technology in all of that, but I think that there’s, there’s a couple of different things that are going on today.

Azeem Azhar:

The first thing is that the speed of the change is just manifestly faster than it was previously. I mean, it took many, many, many decades for the printing press to go from what is now present day Germany to the United Kingdom, just a few hundred miles away. And many, many decades represented more than one lifespan of a person at the time. And today what happens is that those sort of global spread happens in the matter of a couple of years and our lifespans are much, much longer. So this kind of time compression of innovation and its diffusion versus how long we live. And a really, really good example of that is that when I wrote the proposal for the book, I’ve got a copy up here, do the author thing, hold it up-

Des Dearlove:

There it is.

Azeem Azhar:

When I wrote the proposal for the book, TikTok was a nothing. By the time the book was actually published, it had been downloaded more than Facebook. And that’s the nature of it.

Des Dearlove:

Yeah. I mean, we were talking just a little bit before we came on and you were showing us that wonderful computer that you’ve got there. Tell us, because I mean, it’s sort of a great sort of iconic looking piece of hardware now, but tell us the story of that. That was your first ever computer.

Azeem Azhar:

Here we go.

Des Dearlove:

There it is.

Azeem Azhar:

The ZX81. It is from 1981. It costs just under 70 pounds. So it’s sort of $200 in today’s money. It’s got one kilobyte of Ram in the computer and 16 additional kilobytes on here. Now to give you an idea of what that means, I’ve got 16 kilobytes basically of Ram. My laptop has 16 gigabytes of Ram, which is a million times more than this computer has in it. So that’s what’s happened in the exponential age. But that computer, I think talks a little bit to my own intellectual heritage. And I was born in 1972. I was born the year after the first cheap packaged computer chip came out from Intel, the Intel 4004, and I grew up as a child at the same time that the first personal computers were being developed by people like Steve jobs and Steve Wozniak in Silicon Valley.

Azeem Azhar:

And I grew up alongside a lot of, the sort of momentary switch in media from cowboy films to science fiction films and the kind of presence of robots in Star Wars and Space 1999 and Battlestar Galactica. And so, the heart was this sort of sense of the kind of technological possibility. But at the same time I had this device and we had another computer at school and it was incredible to be able to use that because it was nothing like that you could access. You program these things. We were not consumers of them. We were creators. So that’s one stream of that sort of intellectual heritage.

Azeem Azhar:

But the other stream of it was that I was born in Zambia, in Africa, where my parents were out there on some sort of expatriate contract, my dad working as a development economist. And my parents were actually… My mom is academic study, but my dad’s professional work while he was there was in institution building.

Azeem Azhar:

And so when you look at the book, I talk about two things. I talk about technologies that I have personally witnessed go through this curve on the one hand and institution building on the other, which was sort of what was going on around me at home. And they sort of, they came together and I think they sort of form the basis of the argument in the book.

Stuart Crainer:

Yeah. What I like about your stuff Azeem is that it is kind of transdisciplinary. I mean, a draw in economics, political science, psychology. And there’s a sense that we remain very siloed in our thinking and that’s one of the issues in dealing with technology and actually harnessing technology and adapting to it.

Azeem Azhar:

Yeah. I think that’s right. I mean, there’s a good reason for it. And I’m going to make a case that we are coming to an end of the inordinate advantage that silo based thinking has. So, I think what happens in kind of in moments of intellectual history is that we’re looking around for a new paradigm. We’re struggling to find a new paradigm. And when we find it, it becomes really fertile ground to go and specialize. So you’re looking around in physics, you find quantum physics, it seems to make sense. And now every physicist can be a quantum physicist. They don’t have to look at new paradigms and they can just mine away and get better and better and go deeper and deeper. And the same thing happens in business, right? We figure out, eBay figures out, that you can build in business, being a marketplace online in general. They do a really good job.

Azeem Azhar:

And then eBay clones show up in regions. And then you start to say, let’s just do an eBay for sneakers or trainers or high-end handbags. And you exploit narrower and narrower domains. And that idea of specialism makes lots and lots of sense to the extent that it’s quite expensive to be a generalist at those moments in history. At the end of the day, if I look at my career, a hundred plus job rejections, years trying to find a job because I’m a generalist. Had I just gone off and start being a commercial lawyer, which I mean, I studied law at the beginning at university and dropped out, I would’ve never been out of work. I would’ve been narrower and narrower and probably today I would be working on commercial contracts of people trying to unwind their investments in Russia, whatever it is. That’s what my peers in law firms are doing at the moment. But I would’ve been hyper specialist.

Azeem Azhar:

And I think when you get to points of transition, the old models don’t work. And so, the people who built electricity systems, whether it was Edison or Tesla, or the people who built the first cars, they had no experience in energy production that had predated it. They had to be generalists. They had to think about the full picture, they had to cross disciplines. And so I think what the moment for people who are transdisciplinary, who are generalists, who cut across different domains, it’s so much more applicable now than perhaps it was 10 or 15 years ago. I mean, 10 or 15 years ago, you could have been an exceptional breakthrough management thinker, just talking about digital CRM or end-to-end customer lifecycle management and that would’ve brought incredible return to your clients. That doesn’t, it matter as much now because the questions are more existential, they are more systematic. And that’s where systems-based integrated, transdisciplinary thinking starts to shine.

Des Dearlove:

Yeah. I think if you start to look at the world through sort of the lens that you look at the world through. So I had a conversation a couple of weeks ago with Andrew Winston has just written the book with Paul Polman.

Azeem Azhar:

Oh, yeah.

Des Dearlove:

The former CEO of-

Azeem Azhar:

Yeah.

Des Dearlove:

So we were talking about sustainability. But he was saying, the trouble with sustainability is even the language of sustainability is it’s too narrow a lens to be looking at it. It shouldn’t be, there’s this thing called sustainability. It should be integrated into everything because that’s the only way you’re going to tackle the real problems facing the world. It’s not, you can’t separate it out and sort of put it in a separate situation. I think that’s partly sort of what you are saying too, is if you look at the world doesn’t behave in silos. So, why do we try to live it in silos as it were?

Azeem Azhar:

Yeah. But I think we try to live it in silos because, A, it’s hard to… The analogy, I think, I had to take this out of the book, unfortunately, is asking a goldfish whether it would like its water changed and it will say, what is my water? Even harder, would you like your bowl changed? It would have no conception of what its bowl is. And that’s where it becomes hard to think about. And if we think about sustainability, where sustainability has been, I think is where the internet was in 1994 or 1995. You had a .com. That’s what you did. You were a bank and you said, we’ve got to do a .com. Younger viewers to this, anyone who’s younger than about 45, they’re going to have no idea what we’re talking about, but 95, 96, 97 companies were not online. And they had to do a .com, which meant have a web business.

Azeem Azhar:

And now it’s a sort of insanity to think that you would build a company of any scale without using the web as a primary channel. And I think the same thing happens with sustainability, which is that sustain was a bit like .com in 96. And now to not have sustainability in your business means a number of different things. It means, number one, you’re not going to take advantage of absolutely breakthrough, amazing technologies like renewable power or synthetic biology, which I talk about in my book, because those are inherently sustainable technologies. Number two, you’re going to deny yourself access to the best and brightest, young talent, because they want to work in companies in the same way in 97, 98, the best and brightest wanted to work in companies with digital businesses. The best and brightest want to work in are sustainably based businesses.

Azeem Azhar:

And number three, you’re going to not have access to the best customers because customers are going to be looking for sustainability in the same way as 20 years ago they were looking for .com style businesses. So, in that sense, the beauty is that sustainability can disappear into just what is it to run a good or a great business, almost without any kind of external force from government or anything else.

Stuart Crainer:

Yeah. Azeem, it’s kind of… I was reading through stuff and reading through your recent stuff and it’s daunting what we’ve got in front of us. And I was kind of hoping that, who does this well, is what I… Like, institution building. And I was trying to think, who does this well, because best practice always gives you hope, doesn’t it?

Azeem Azhar:

Yeah. So prior to this week, things have changed in the last week.

Des Dearlove:

And we’ll come to that.

Azeem Azhar:

We’ll come to that.

Des Dearlove:

That’s a conversation we’re going to have.

Azeem Azhar:

But prior to this week, we could look at places like Singapore or Taiwan or Estonia that had-

Des Dearlove:

We’re joined by… I can see we’ve got people from Estonia here. I can see them, yeah.

Azeem Azhar:

Oh. From Estonia? Tere, tere to my Estonia friends. And they had figured out how to sort of build government, state, private sector, public alignment on a lot of these issues and in slightly different ways. And you can always argue, they’re a bit weird. They’re small, highly educated countries, but they’re all quite distinct. And I think then there are pockets where you see really interesting things happening. If you look in the UK, the financial conduct authority has said, oh, how do we regulate all this innovation without killing it? And so they created a few years ago, something called a sandbox where you could play in this regulated industry with a bit more freedom than being fully regulated as long as you told them about it. So, in general, I think it was, it was very, very few and far between, great examples.

Azeem Azhar:

It often, by the way, Stuart, when you look at the institutions, it’s often not the civil servants within political institutions. It’s actually the politicians who are the problem, right? The civil servants understand what’s going on and know how to make change. And the political roundabout doesn’t allow them to. Within companies, I think there’s a much harder problem because a lot of these questions are, that they fundamentally challenge the skill sets and the assumptions that have made you really, really successful. So I’ve been really fascinated to look at the car companies and keep asking them, when will you make the electric vehicle transition, which in the last year or two they have all started to do. And when you talk to them honestly, and one person, the number two at Ford, Hau Thai-Tang, has said this to me on my podcast on the record, but a number of senior execs have said the same thing to me off the record, is we didn’t believe for years that electric vehicles were possible and Elon proved to us that it was.

Azeem Azhar:

And of course, what Elon Musk understood was the exponential decline of the price of lithium ion batteries, the exponential improvement in electronics. And so he knew when he started building Tesla, the model S, that battery packs cost $800 per kilowatt hour and electric cars wouldn’t be priced parity with petrol cars until battery packs cost about a hundred dollars per kilowatt hour. So you had to go from 800, back in 2014, to a hundred for the average consumer to just say, listen, economically, it makes sense to go electric. But what Musk bet on correctly was that lithium ion batteries were an exponential technology. And the price would decline by 15 to 20% every year, which it has done, 2022, even with lithium prices going up, we’ll see electric batteries at $120 per kilowatt hour.

Azeem Azhar:

And what Musk has gone off and done organizationally, is that he has built the best company for producing large numbers of electric vehicles. And people in there know how to build the power trains, how to iterate, they know how to do it at scale. And he’s built the brand. Now, I happen to think that car companies won’t get wiped out the way the internet wiped out the newspaper publishing companies. But there is a really interesting question, which is, what did he know that you didn’t, Mr. Boss of Volkswagen, Mercedes, Toyota and so on. And how do you avoid that perceptual blindness?

Des Dearlove:

Yeah. I mean, you’re talking really to Clay Christensen’s Innovators Dilemma stuff here, because if you are the incumbent, you don’t invest in those technologies that are inferior to the technology you’ve got. So, where we’ve got a little bit of this disruptive innovation. So it’s good to hear that Clay’s theory is still kind of makes sense. But I’m going to want to take you back to Estonia.

Azeem Azhar:

Yeah.

Des Dearlove:

Because Estonia has suffered, as I understand it, the very first sort of cyber attack in terms of cyber warfare, or if not the first one, one of the very early attacks by Russia. I know the book, your book talks about cyber warfare.

Azeem Azhar:

Mm-hmm (affirmative).

Des Dearlove:

You’re obviously in a terrible place and thinking about the people in Ukraine, but what can we learn from the book? What have you learned in the last week?

Azeem Azhar:

Well, I’ve just learned so much. I’m going to bring it back to the book. I mean, in the book, when I look at this question, it’s really back to the framing of what happens when prices come down? And when prices come down, demand goes up and as demand goes up, ubiquity increases. And what does that mean in a security environment? What it means is that, we live in these homes now that are highly digital. I mean, mine is slightly non-standard, but I have more than 140 devices connected to my home network. The average home probably has 20 before you realize it, because your thermostat’s connected to the network and your kid’s got a smart wifi light bulb. And every one of those, we’ve put these connections in because they’re basically free and they give us new functionality, but every one of them is a vulnerability that can be approached and exploited.

And so, what you see in the world of conflict is a whole slew of modalities of attack that are getting cheaper and cheaper. Cyber warfare, whether it’s ransomware or fishing or out and out denial attacks is incredibly cheap and can be profitable. At the same time, you see now that every citizen has gone off and said, here I am, I live on Twitter here, or I live on Facebook here, you’ve got the ability to launch misinformation and disinformation campaigns, which we’ve seen over the last seven or eight years in pretty much every country in the world, they’re very, very cheap to run. And then finally, you see the availability of drone based warfare where you don’t put your soldiers at risk. Now, the thing that’s interesting about all of these is that it reduces the cost of launching an attack.

And that means that an attack doesn’t need to look like some of these kinetic things that we’ve seen in the last few days, the Russians launching missile at schools and government buildings and so on. You can kind of constantly needle at your adversaries all the time and keep them in that sense of either being a bit pent up or being a bit off, whichever one it is.

When we look at what happened in Estonia, we pretty much know that this attack largely came from the east. It probably came from Russia. It debilitated many, many parts of the technical systems of Estonia. And at the time, NATO didn’t institutionally have a response. 12 years later in 2019, Jens Stoltenlberg, who we’ve heard on the TV in the last few days a lot, said, look, a cyber attack could trigger article five if it’s serious enough. And that’s where the institution catches up.

So when we look at this week in the Ukraine, I think that what you’ve definitely seen is on the disinformation side and the information space side, the Russians have been doing a lot of this ground work for a long time. And they tried to say, talk about the separatists and the LPR and the DPR as they call it, and they didn’t succeed because actually, the Ukrainians ran a much, much better information campaign than the Russians did.

On the cyber attack side, you’ve seen every part that I sort of describe play out. So you have seen state to state cyber attacks. They’ve not been publicly very effective, but I understand there’s a hell of a lot going on in the background that we don’t yet know about, but you’ve also seen this idea of affiliated groups who might be connected to a state, launching a tax on their behalf.

And I think the most famous is the Anonymous collective of hackers who took over Russian state TV to broadcast Ukrainian national anthem a couple of days ago. And Anonymous is group of people who’ve been running for 20 years and not really affiliated to anyone, who has these capabilities and does them when they feel the cause is just.

And on the side of drones and drone warfare, we’ve not seen much from Russian drones. Again, although what I understand is that a lot of their drones are in the kind of field of observation and communications are too small and they don’t sort of show explosion, so aren’t that interesting. But on the Ukrainian side, Turkish TB2 drone, which I write about quite extensively in the book, has been in action a lot in the last week. So I think it encapsulates what I call the first exponential age war, because all of the pieces have come together in a way that they didn’t in the American intervention in Afghanistan or in sort of previous conflicts.

Des Dearlove:

No, it’s fascinating.

Stuart Crainer:

You’ve published an article this week and your usual Exponential View comes out every Sunday. And there’s a brilliant article that you published last Sunday on Ukraine. And you’re predicting a new geopolitical order, essentially.

Azeem Azhar:

Yeah, unfortunately. I’d love things to sort of poodle along in a sort of sense of perpetual peace, but I think we’re going to get there. I think the reason that this emerges, let’s go back to the book and sort of technology. So I have a section called, the world is spikey. I Mean, the world is spikey. I make the argument that there are forces of deglobalization that are emerging. It was the forces of globalization that allowed us to get to the exponential age, they expanded markets, they drove down prices through bigger markets and learning rates. But what those technologies enable is they actually enable a lot of local production and kind of reindustrialization. So the technologies, for example, of renewable power, don’t need you to move billions of barrel of oil around the world.

They also don’t need hulking great $4 billion power stations, whether they’re a small nuclear stations or coal fired power stations, they’re very modular. Solar panels can be put on roofs. They can be run at the community level, at utility scale level. If you look at South Australia, for example, South Australia has made a tremendous shift in its electricity generation to solar power, largely because of individual household sticking them on their roofs or in their big gardens. So that technology is a distributed, decentralized technology that can also be localized. That also applies to storage systems. It also is starting to the production of food. We’ve got used to high intensity greenhouses and the Netherlands has shown what happens when you take high intensity agriculture and you can essentially eliminate your disadvantage of your floor area.

The Netherlands is not the biggest country in the world, but it is the sixth biggest exporter of food. And much, much more efficient and predictable than the greenhouses in the Netherlands, is our controlled environment vertical farms, which are a tiny teeny business right now. They’re $5 billion globally out of 8 trillion in the food industry, but growing really rapidly with all of the hallmarks of a sort of exponential growth trend. So what that starts to say is, well, we can get our power locally. We can grow our food more locally. And I currently get my tomatoes from Spain. I live in London, it’s stupid. And through 3D printing, which is another exponential technology, we’ll be able to also produce the elements for finished manufacturers locally. That puts pressure against the sort of previously ineluctable logic of globalization. COVID came in and shocked us to hell around the fragility of those supply chains.

The strategic importance of technologies like semiconductors, made people realize you can’t have them all in Taiwan. You’ve got to put them elsewhere. And so you’re starting to see factories show up for the first time in 30 years in America, and the first time in the UK and Germany, to create local hubs. And now that we’ve got this war going on in Ukraine and a really clear signal of a group that we had written off, which was the west, saying, we are going to draw some red lines, and they’ve effectively gone through and isolated the Russian axis.

You start to see a new set of polarities emerging. And I think that does create a new global order. It’s simply not going to be sufficient to say, we’re going to do business in Russia because we will make money and at some point pay taxes, the Western governments have said, that’s not going to happen anymore. And it’s hard to know when that will unwind. And partly because which investor, which businessmen would trust going to do business in Russia. They don’t know when sanctions will hit. They don’t know if the Russians will adhere, abide by the laws. They don’t know anything.

So, all of this will create, I think, more of a, not so much a bifurcation, but a set of, I think the phrase, just to quote Dolly Parton, if I may for a second, “Islands in the stream,” different islands that will find richer or less rich ways of interacting with each other.

Des Dearlove:

No, it’s fascinating. I mean, one of the interesting things you’re talking about sort of, I mean, again, one of the lessons that we are learning very rapidly with Russia is how reliant certain countries are on gas from Russia. I mean, I think I read in your article, Austria is a hundred percent reliant on Russian gas, which is obviously all of a sudden, what seemed to make good sense in terms of the globalization game. I mean, and as we saw with COVID is what we suddenly saw how fragile supply chains were.

Azeem Azhar:

Right.

Des Dearlove:

That’s going on. So is there a sense, I mean, one of the great attributes of technologies, which you alluded to earlier with the printing press is the democratization process that can go on. Suddenly we can all have books, suddenly we can all read. It kind of evens us up. But this thing of distributed power and distributed production, that seems to be the next thing that has to happen, which is in some ways moving against, as you say, against the inevitable rise of globalization and to some extent, specialization.

Azeem Azhar:

Yeah. I mean, I think it does. What shape it takes and how it benefits different societies will also depend on the institutional and cultural context. It’s really interesting, if you look at the spread of the printing press and the spread of literacy in Europe in the 16th to the 17th century, four countries, roughly the New Netherlands, which had been a Spanish colony, France, Germany, or the HRE, Holy Roman Empire, and although I don’t think they turned it into a three letter acronym back in those days, the HRE, the Holy Roman Empire and England at the time, all started roughly at the same level of literacy in the 1450s. Within 200 years, the Netherlands and England were miles ahead. And the question is, why had that happened?

Azeem Azhar:

And the interesting context was that institutionally the Netherlands and England were slightly more commercial, and there were parts to success that were driven by trade. Whereas in the other countries, the path to success was actually driven by maintaining your existing power base. And so literacy in France was contained because there was no economic advantage to have your kids learn to read or write rather than put them out in the field. Whereas in the Netherlands in particular, but also in England, there was an economic advantage in doing that.

Azeem Azhar:

So when we think about these new technologies that are coming out, that are distributive and distributed, the extent to which they enable national economies to get stronger, to have more independence, to be makers on the world stage, rather than takers, I think is going to depend on the sort of economic institutions and the policies and the cultural values that are brought to bear. And I think it’s going to hugely, hugely favor those countries that have cultural creative strength, and that have investments in education, especially in those areas of real sort of complexity. And so, that would be my sense of how it might end up playing out.

Stuart Crainer:

You’re an entrepreneur, Azeem, as well as everything else. And what’s the technology that excites you most at the moment? Entrepreneurially, where would you be looking to invest? I know you’ve written recently about micro mobility, synthetic biology and so on.

Azeem Azhar:

Yeah. So the most interesting areas for me are that point where the technology is not quite ready. The entrepreneurs understand the technology and have a vision of how they can experiment to make it happen. And it’s that intersection that really matters. If the tech technology is ready, then Costco or British Airways or Ikea has already got there. Right? And so for me, that particular technology, the one that I think stands out the most is that intersection of biology and engineering and computing. And the way to understand that is that, for many of us, biology has been this squishy, slightly random subject, right? We don’t really know what happens. We don’t know the mechanisms. But over the last 30 years, the science of biology has moved to a much, much stronger understanding of the mechanisms and the pathways that exist, the relationship between the expression of protein and how genes and sort of genomic expression and the microbiome interact to kind of construct us as sort of physical beings.

And because we’ve understood that, and we’ve essentially been able to digitize biology because after all, strings of genes are binary data, GCTNA, GCTNA, Gattaca, Gattaca. We can put that into the computers that we have now that are much, much more powerful than this. And we can apply engineering mindsets. And what engineering does is it turns slow based scientific research into high throughput production systems. And so today, a large part of our economy is driven by non-biologic systems. For example, all the materials that we use that come from petroleum products in the form of plastics and the detergents and so on, so much of that actually could be produced through what has been called bio factoring or bio foundry, bio foundries, biomanufacturing, where you are able to tinker with microbes or biological systems and get them to express the material that you want, are after all, wood makes and has made a wonderful material for building things.

So that area for me, is super interesting. It is super fertile. McKinsey and Company say, oh, it’s going to be a $4 trillion market by what, 2030, 2040. I mean, I think they are hopelessly wrong there. I think it’ll be much, much bigger than that. And I’m quite excited about that field.

Des Dearlove:

So can you give us some idea of some of the applications of that? I sort of understood most of what you were saying, but what will that mean? How will that change our lives? I mean, what are we talking about here?

Azeem Azhar:

Yeah. I mean, a sort of a good example would be, if you think about materials that we might use, like a plastic, there are lots of things that we use plastic for. We use them maybe for bags or packaging, but there are lots of plastic-like things that exist in nature, whether it’s algal films or other things that can be created by microbes. So, if we-

Des Dearlove:

Which would be biodegradable as well presumably, which would also be quite remarkable.

Azeem Azhar:

Sorry? And they biodegrade, right?

Des Dearlove:

Yeah. Exactly.

Azeem Azhar:

They biodegrade. And they can be essentially carbon neutral, because if you use a type of, say, a phytoplankton to make your bioplastic, it’s actually going to suck in CO2 is one of its inputs in order to produce that output. Now, the problem that you’ve got is that we use a lot of plastic. And so we have to figure out how you take the kind of random activities of these microbes or these biological systems, put them in more of a controlled environment, figure out how to more sort of aggressively express the proteins that we need, and then learn how to do this at scale. Th reality is, where we’ve been able to do this so far biologically, has actually been in really expensive therapeutics, and you just don’t need that much of a drug. So we can make milligrams or grams of this stuff, but we need to make millions of tons of it. And so the interesting challenge is, how do you kind of go from that grams to millions of tons industrially as well?

Stuart Crainer:

Do you feel optimistic, Azeem?

Azeem Azhar:

I wrote about this recently. I call it a sort of a pragmatic optimism. Gramsci, Italian sociologist, has this phrase, right, calls it the pessimism of the intellect and the optimism of the will. The technologies themselves give us reasons to believe that we can sort of solve new problems and tackle the problems that we face. But we have to be skeptical both in terms of how we build them and how we bring them to market and what their impacts would be. But one of the things I would say is that, of course, we’ve been here before and we’ve still messed it up, if we have indeed messed it up, because if you go back a hundred years or 200 years ago, in fact, don’t even go back that far, go back 1933, dust bowl America, young mother with her two kids, starving, walking, no food for miles. Husband has gone off to California to be a seasonal picker, walking down the train lines. It’s terrible.

And you could say, could you believe that in 30 years time, all of your grandkids will go to college. And by the time they have kids, we will be on the verge of an environmental catastrophe and in a land war in Europe. I mean, the reality is that we have sat at these moments before, because the beauty of being humans, learning, collaborating, communicating is that we can achieve a lot, but the technologies in themselves are useless if we don’t have the ability to communicate, the ability to express our values, the ability to mediate, the ability to include people. And so technologies, amazing, great. They’ll do their thing. What we have to get real about is how we get them to do their thing and whose thing it is, and who gets to speak about that and who gets to be involved and actually how we make it happen as a human system.

Des Dearlove:

Okay. What we always ask on these webinars is, we ask for kind of some takeaways and some practical things. I mean, you’ve described this frightening world in some ways, but also full of opportunity perhaps, but how do we learn to close our own exponential gaps and how do we live as individuals in an exponential world? What are some of the things we can do?

Azeem Azhar:

I think it’s a really, really interesting question. And I think you have to do two or three different things that are slightly odd. So one is, history is an incredibly good guide and I spend quite a lot of time reading, I spend a lot of time on Twitter, but I spend a lot of time reading books. And I look at things that have been written over longer periods of time to try to understand what’s going on. And I think that that is really an important part of the picture.

I think the second part of the picture is about being able to take ownership. The tools are politics at some point. And so the more you pick up an app or pick up a smartphone and don’t start to understand the tool and therefore understand who’s built it and why they’ve built it and what choices they’ve made, the more you are likely to walk into a place where you are ill equipped for dealing with the ramifications.

And both of those things do take work. I mean, they take work that… But unfortunately, as my old sales director used to say to me, there’s only one place where success comes before work and that’s in the dictionary. And so, those are the first two.

And I think the third thing that you can do of course, is you can buy my book and you can read my book, because I think in there, I construct some frameworks that help people understand how to think through some of the things that they’re seeing.

Stuart Crainer:

Azeem, many thanks. And we forgive you for the plugging of the book because it’s an excellent read and we strongly recommend it. So we’d like to say, thank you to Azeem Azhar for joining us. Azeem is the author of Exponential. It really is essential reading, especially at the moment, I think, because the Ukraine war is making us think about a whole host of things. Check out Azeem’s website, exponentialview.co. Again, it’s indispensable and his Sunday newsletter is… Certainly a lot of people are paying attention to it and learning from it. So thank you, Azeem, for joining us.

Azeem Azhar:

Well, a pleasure.

Stuart Crainer:

Next week, at the same time, we’ll be joined by Christian Rangen. I would like to thank everyone too for joining us today from throughout the world. And thank you to Deloitte for partnering with us on the Thinkers50 Radar. We’ll see you again soon. Thank you.