The Ingenesist Project

The 5 Pillars of The Inevitable Economy

Dan Robles — Wed, 25 Jan 2012 01:03:35 +0000

The previous article identified a recurring trend in human history; each new stage of civilization resulted from the integration of tools invented in the prior stage. That is; the output of one tool becomes the input of another.

In general, this is what defines a “system”. One of the problems with systems is that if one major piece fails, the whole system falters. Today we have computer systems, transportation systems, social systems and financial system that all behave in this way.

The financial system is built on five integrated pillars

Currency

A currency is a device that people use for both the storage and the exchange of value. Currency serves as a proxy that represents the value of things that people produce it is not in itself a product.

Inventory

The accounting system keeps track of the things that people produce. It is helpful to use a currency to represent the the storage and exchange of value from the things that people produce; but again, currency is only a representation of inventory.

Vetting

An economy must have a vetting mechanism that keeps the game fair otherwise nobody would play. Today this includes a legal system, contracts, and institutions - such as representative government – that defend the value of things that people produce.

Entrepreneurs

Classically, entrepreneurs are the merchant class who allocate land, labor, and money in various proportions and combinations as a means of organizing and matching the supply of things that people produce with the demand for what people produce.

Society

People define markets. They supply the inventory that other people demand and they demand the inventory that other people supply.

Examples of financial system failures are legendary

The Enron Fiasco was an accounting system failure caused by a vetting mechanism failure. The housing bubble was a was a currency failure because CDOs effectively divorced the dollar from any meaningful representation of productivity. The unemployment crisis is a social failure that limits the ability for people to supply the things that they demand.

The Inevitable Economy

So what if the functions of these same five pillars could be achieved and integrated in some other way? What if this is already happening? Going through the list backwards to reflect a mirror image:

Society

People are reorganizing in new and different ways. They increasingly use social media and mobile technology to supply and demand limitless information with which they then use to supply and demand many useful things of each other.

Entrepreneurs

Land, labor, and capital are becoming increasingly irrelevant in the age of non-scarce information – instead, entrepreneurs are allocation social, creative, and intellectual assets as a means of matching the supply and demand for the things that people need.

Vetting

Social contracts are playing an increasing role in keeping the game fair. It is not in the best interest for anyone to act with low integrity when they can be Googled in a matter of seconds.

Inventory

The knowledge asset inventory is forming in many applications and platforms – but it is not yet integrated. When this happens, an accounting system for social, creative, and intellectual assets will immediately emerge.

Finally, the currency

Any device that can represent human productivity better than today’s money will become that next currency. This can only happen after the four pillars begin to integrate.

The currency is supported by the system. The system is NOT supported by the currency.

The Inevitable Next Economy

Dan Robles — Mon, 23 Jan 2012 23:31:40 +0000

The Human Productivity Chart:

Human civilization has progressed through many stages. Each stage arose from the “integration” of the tools developed in the prior stage. Believe it or not, the next economic paradigm will arise from the integration of the tools being developed in the current stage of human development. Let me explain:

Hunter -gatherer:

We started as hunter-gathers who traveled from place to place to follow animal migrations and seasonal flora. People would collect fallen branches and burn them for heat or cooking. Then people started to sharpen rocks that could be used to hunt food better than a dull rock. They sharpened rocks to chop down trees for warmth and shelter. Soon they sharpened rocks to till soil.

The agrarians

The arrival of the agrarian age came when the arrow, the axe, and the plow were integrated; that is, the output of one became the input of another – allowing people to conserve energy and increasing productivity. The emergence of communities led to the division of labor as people specialized their skills. People soon developed tools and techniques for forging metals, building structures, and harnessing of forces such as wind, sun, water, and domesticated animals.

City-states

The arrival of City-States arose when division of labor, harnessing forces, and transportation became integrated. Spare time became available to experiment in ideas such as governance, laws, civil services, and currency. Travel allowed for trade of goods, services, and the spread of knowledge across great distances.

Philosophers

The age of philosophy emerged as the leisure class, knowledge exchange, and civil law integrated such that people began to question existence, spirituality, and test theories about the observations that they constantly witnessed in the natural world.

Scientists

The scientific age emerged from the integration of tools developed during the philosophical age. Written language, mathematics, geometry, came together as alchemists attempting to turn lead into gold, instead created many other new and useful things from the elements. Astronomy, calculus, the scientific method, and modern finance were born.

Industrialists

The industrial age emerged as an integration of the tools developed by the scientific age. Eli Whitney demonstrated the “interchangeability of parts” paving the way for modern production. The printing press and cotton gin demonstrated the scalability of machinery while capitalization and securitization of value (finance) allowed a merchant class to allocate land, labor, and capital.

Information

The age of information formed from the integration of tools created by the industrial revolution. All that machinery created a tremendous amount of data. Computers were developed for processing data creating information that could be used to make productivity more efficient.

Knowledge

The Knowledge age emerged from the integration of tools developed during the information age. The Internet vastly accelerated the amount of information available from which knowledge could be applied as factors of production in physical systems from weather prediction, space travel, medicine, and new ways for people to organize their selves.

Innovation

The innovation age will emerge from the integration of tools developed by the knowledge age. So called “social media” is creating thousands of platforms upon which people reorganize themselves around interests, affinities, relationship, and commerce. As these tools integrate; that is, when the output of one tool becomes the input of another tool (and vice versa), a new economic paradigm will emerge.

Wisdom

Keep in mind that the agrarian economy and all previous stages are still with us today. Keep in mind that elements of future economies also exist today. Keep in mind that the US dollar has not always been the currency of trade nor should we expect that it will always be with us in the future. We can assume that the productivity inherent in people and communities is not dependent on the currency, rather, currency is dependent on it. Time is the only scarce resource and everyone has an equal amount of it. As such, time is the only true currency.

Ideas Are The New Currency

Dan Robles — Tue, 20 Dec 2011 21:30:53 +0000

‘Tis the season for “The Year In Pictures” – the annual new year pictorial accounting of the events of the outgoing year. Any rational collection for 2011 would include three events; Arab Spring, The Earthquake / Tsunami in Japan, and Occupy Wall Street. These three events eclipsed the Royal Wedding, Steve Jobs, the tenth anniversary of 9/11, the space shuttle retirement and even the end of the war in Iraq.

These three events tell a very interesting story of who we are and where we are going as a civilization.

Classical economists such as David Ricardo and Adam Smith brought us the idea that a merchant class allocates land, labor, and capital in various combinations as “the factors of production” that match supply and demand for all that societies need via the invisible hand of market capitalism.

Yet, in a single hour, land, labor, and billions of units of Capital were wiped off the surface of the Earth by in Japan. While we see the images of total destruction, there are hundreds of square miles that were untouched and where all seems quite normal – except for that invisible hand of radioactive cesium. Land, labor, and capital failed as a an economic cornerstone for all those who had once called this land home.

In the Middle East, with few jobs and even fewer opportunities for youth, the quaint notion of “land and labor allocations” crumbled under the forces of people with mobile access to dynamic data, free information, community knowledge, innovation, and wisdom. Governments, with no relative shortage of money, were unable to challenge the opposing factors. Again, the idea of land, labor, and capital as the economic cornerstone had failed.

Quite appropriately, Occupy Wall Street was executed on borrowed land, with borrowed labor, and borrowed capital. The operation was peaceful so nobody died. The stock market did not even crash. Politicians went largely unscathed and the attorneys stayed in their collective offices. Nothing physical was actually created, and therefore, nothing physical was actually destroyed. However, a great deal was produced.

All three of these events had something in common – they all produced something very tangible. They all produced an idea in the minds of others.

As we review the year we review it is increasingly evident that land, labor, and capital are inadequate to articulate what people actually produce. It will be through these shortcomings of classical economics that a new economy will form. The degree to which society actually produces the things that society actually needs, this new economy should not look much different. The degree to which society does not actually need the things that capitalism produces, great new ideas will emerge.

What was once the land of opportunity can now become a planet of opportunity.

Photo Credit: David Shankbone via Mashable

The Paragon of Capitalism

Dan Robles — Wed, 14 Dec 2011 05:26:42 +0000

Capitalism is characterized by the condition where individuals acting in their own best interest consequently act in the best interest of society. By contrast, Socialism is characterized by the condition where individuals acting in the best interest of society consequently act in their own best interest.

Who are the Socialist?

While America espouses a capitalist system of social organization, the jobs that Capitalists create are contained in corporations that operate much closer to the socialist model of community organization.

In a corporation, employees are motivated to act in the best interest of the corporation as a means to assure their own best interest. Resources allocation is channeled through ministers who are led by a benevolent dictator responding to the priorities of a family of stockholders. Tasks are segmented into units of equal pay for equal work. There are limited avenues to advancement. People cannot talk freely against their employer. It is acceptable practice to banish some people for the best interest of the collective.

First Amendment To The U.S. Counterintuition

The opposite holds for the OWS movement – some say the occupiers are socialist, however, the jobs that they create are Capitalist. There is no benevolent dictator or appointed ministers or hierarchy to allocate resources. Anyone can join and nobody gets sent to the gulag. Yet, everyone knows what to do like some kind of invisible hand that elevates an ideal. Most importantly, there are unlimited avenues for advancement.

The movement was peaceful.

Buildings did not fall. Mothers did not mourn the death of children. There was no volatility induced on the stock markets, the lawyers stayed in their offices, politicians were relatively unscathed. Those protestors who did suffer are now celebrated in the media, culture, art, music, Facebook, etc. In short, People acting in their own best interest were in fact acting in the best interest of society.

Reoccupy Wall Street

Now that the movement has been dispersed, and the 89% who still have jobs return to occupy their respective corners of Wall Street. The global narrative has changed for everything from warfare to environmental protection to income equality.

The products that emerge

Already, mobile apps now exceed CD/DVD sales. Mobile computing devices will replace PCs. Television sales are going down. Many of us now own our last internal combustion automobile. Social Media Applications are mimicking financial instruments with new systems for trade, exchanges, trust, influence, and value creation. Allocating social capital, creative capital, and intellectual capital rather than the now quaint but hopelessly static notions of land, labor, and fiat capital is producing real value.

Capitalism and socialism are simply two of many different forms of social organization. People are reorganizing.

Do We Really Need To Fail?

Dan Robles — Wed, 30 Nov 2011 18:49:00 +0000

Yesterday, I heard a report on NPR about the resource management department in North West Washington, in response to diminished funding – is certifying private boats for emergency duty in clean up, security, and rescue. This is logical because nobody knows and understands the waters of Northern Puget Sound and The Strait of Juan De Fuca than the local tribes and others who ply those waters daily.

Today, I heard another report on NPR about how the City of Houston has gained far more from the demise of Enron than their existence. Enron would recruit the top intellect in the country, move them to Houston and reward them for creativity and hard work. The collapse of Enron released 4000 hugely talented people to the Houston Economy where many have started new businesses with remarkable success.

Vicious Circle or Virtuous circle:

I will not pass judgment beyond what these reports stated, except that there is something very valid about the “Knowledge Inventory” that exists in a community and their specific location. The Jane Jacobs externality proposes that endowment of creative and educated people drives economic growth in a community by attracting investment and development, which attracts more smart people, etc.

Vicious Galaxies or Virtuous Galaxies

As the NPR reports suggest, the type of investment and development is dependent on the quality and quantity of knowledge assets that exist in a particular location. Now, let’s extrapolate that to include all disciplines and talents of knowledge that exist in all communities and we encounter a stark reality that there is no knowledge inventory from which to build – except in the response to a failure such as the corrosion of government spending or in the wake of corruption and associated corporate collapse.

Yes, it is often said that adversity brings out the best in people, but is that really necessary? Do we really need for the whole rig to collapse before we emerge from the ashes?

We need to build the knowledge inventory today. People need to know what people know – that is where the truth lives. We need to know what can be built from the parts that we have in the bin. We don’t want to try to build something from the wrong parts any more than we want to misallocate the right parts to build the wrong things. In any industry in the world, none of these situations would pass the stink test, yet this is the state of our communities today. We don’t even know that we don’t know what we know. Seriously, is anyone else wondering about these things?

89% Already OWS

Dan Robles — Wed, 23 Nov 2011 21:26:25 +0000

99% of Americans don’t have a game that they can win playing by the rules imposed on them by the other 1%. But in order to keep this game in play, that 1% utterly depends on the remaining 89% who still have jobs to show up for work and do as they are told. The spectre of the 9% fallen is an incentive, of sorts, to those still walking.

These are the 89 percenters…

…who already occupy Wall Street with their knowledge of systems and processes to implement procedures and methods that support the connections and networks of the remaining 1%. Without these people in place, the system will fail faster than S&P can calculate a credit score, literally.

The 89% know what each other know

The logistics manager knows whom to call when the packages are late. The account manager knows all of the customers by name. The service team knows exactly how to get the computer systems back online. The loan officer knows where the money is. But only the 1% know where the knowledge is…and where it isn’t…

Knowledge is money

As RIM recently learned, if the computers go down, all the money in the world will not bring them back. Most companies have an off-line life span of only a few days or hours before irreparable damage occurs. Only the right knowledge in the right place at the right time can save the firm. This is a huge monetary vulnerability.

The Public Knowledge Inventory

I found a great picture of the Occupy Wall Street Library from here. The great irony is that OWS felt the need to build a Library that represents the ideas that they have between their ears. What they really need is a “Library” for the knowledge that actually lives, breaths, and acts in the minds of the 99%. Only then can they deploy the force that they need to move enterprises.

Divide and conquer

As long as Americans are fighting with each other, there is little chance that they will organize their knowledge assets and deploy their knowledge assets in a manner that serves social priorities instead of Wall Street priorities. This is the big shift that the World is waiting for. As long as people fear losing their jobs, they will comply with the 1%

What scares them the most?

The greatest fear of any company is to have their key employees poached by a competitor. Companies have gone out of their way to implement non-poaching agreements between known competitors and NDAs against unknown competitors. Companies hide key players behind a mountain of bureaucracy, misinformation, and obscure titles and job descriptions in order to hide them from the open market; yet they willingly poach other firms when they can.

The cry of the 99% is income equality.

Let me suggest that OWS consider knowledge equality as a superior alternative. So instead of the OWS book library, they should form a public knowledge Library. A public knowledge inventory would make knowledge transparent to all people and all companies equally.

Then Let the Poaching begin

If the 89% were not scared heartless about getting another job, then they would be far more willing to join the movement. In fact, the MVPs would be the most powerful voice of the movement – the top innovators and visionaries toiling their life away for a company willing to raid their pension fund or drop insurance coverage at the drop of a hat. Nobody is going to tell them to take a bath – they are the water.

Who is Awarding The Disruption Badge?

Dan Robles — Thu, 10 Nov 2011 20:59:58 +0000

There are some big names getting involved with “badges”. Modern ideas about badges arise from incentive used by the gaming community to indicate achievement. Historically, however, badges are older than money itself. Recently, badges are gaining attention in the area of education as a means of indicating achievement.

Badges are steeped deep in our economy and culture

When people write their resume, they “badge” themselves with the names of the companies that they worked for and the schools they attended. They badge themselves with the market brands of the products that they worked on. They badge themselves with the trademarks of the technologies that they applied.

People even badge themselves with corporate ideals such that “chronology”, “reasons for leaving” and “no blank spaces” are somehow rational proxies for intellect, creativity, and team working skills. We need a behavior platform, kids. Passion, family, and purpose are merely business disruptions.

There are several directions that this can go

The first is the inevitable collusion between badges and branding. I am still scratching my head over AMEX hijacking the “Social Currency” badge. Other badges (or logos) are considered among the most valuable assets that a company can own from Microsoft certifications to the Chuck E Cheese Rat … badges have value – with their own branch of the legal profession to prove it.

The second direction can be quite disruptive to branding. For example it can cost well over $100K to wear the Harvard “Badge”. Meanwhile Steve Jobs literally ridiculed Stanford to their collective face(s) with the idea that diverse combinations of knowledge assets are what set the innovation enterprise apart from the old guard.

What if the college degree badge is irrelevant?

Who is to say and engineer in not an engineer until they take on $2000 more debt for a course in Western Civ. And, if not Western Civ., then what course denotes the ascension into engineerhood? A physics major that rules video games, kite surfs, plays in a punk band, and writes decent code is equally, if not more likely, to create a new industry than someone with a CS degree from MIT. Where is that badge?

Badges should be disruptive

What happens when it is no longer important to have “Google” on your resume? Why is it so now? What happens when being a Princeton drop-out is no better or worse than being a drop out from State U? What happens when people are recognized for their passions and the things that they are naturally good at? How can a credit score extrapolate success from measuring failure? What happens when there is no badge for the color of one’s skin, physical appearance, or family connections. What happens when Brands are accountable for the people who wear their badge instead of the other way around?

Badging already exists and in order to improve anything, badges must be disruptive.

So, who is awarding the disruption badges?

Plenty of Work But Where Is The Knowledge?

Dan Robles — Fri, 21 Oct 2011 18:37:35 +0000

Millions of people are looking for Jobs. Meanwhile, employers complain of a chronic “skills mismatch” that prevents them from hiring people or initiating new innovations.

When an engineer is laid off from an airplane manufacturer, a company like Starbucks has no idea what that person knows even though aircraft and milk steamers have a great deal in common from the perspective of the Engineer (both are pressure vessels subject to extreme environmental conditions).

The same is true for a marine engineer, and HVAC engineer, or an electrostatic coating machinery engineer. Each of these disciplines has far more in common than they have differences. However, if you compare the descriptions for any of these jobs, they sound like they all happen on different planets.

God forbid you are not an expert on MS Excel, which only takes a few hours for almost anyone to learn – yet not tagging that radio button can negate 20 years of experience that only 1% of people have the desire, discipline, and intellect to achieve.

The same holds true for many talents and professions. There are serious problems with the way that we discern the supply and demand for knowledge assets.

What is needed is an intermediate knowledge inventory in the commons that everyone can index to. So when an engineer tags “pressure vessels” the term registers into the resident ontology of all observers.

Why is this better?

Of course companies are trying to eliminate variance and risk by hiring a person who has been trained by someone else – preferable a direct competitor. On the other hand, the mantra of modern business is to innovate. Innovation does not happen by duplicating yesterday’s ideas. Mixing diverse combinations of knowledge assets, and not all common knowledge assets, accelerates the process of Innovation. Think of all the music that is yet to be created for lack of musicians to play the different instruments.

An intermediate knowledge inventory solves both problems by allowing companies to introduce diverse knowledge assets without introducing irrelevant knowledge assets. It also gives people far more mobility to pursue specialties that they are most talented and interested in. As such, the allocation of knowledge assets would improve to match supply of knowledge with the demand for knowledge in an innovation economy.

There is not a shortage or work, only a shortage of knowledge about knowledge.

Where Teachers Hold an Equity Position

Dan Robles — Wed, 19 Oct 2011 22:14:08 +0000

Teachers are “threatened” with layoffs. In some cases, the profession is openly mocked. Meanwhile, corporations are staring blankly at the knowledge gap in their industries. The older generation is retiring, moving on, and taking their knowledge with them. Teacher’s unions are busted and disappearing. Apprenticeships are a thing of the past. Everyone is asking “where are the jobs – there is plenty of work to do”

Education is obviously a financial instrument. Think about that for a minute – it is an investment like any other investment. Wall Street has an arbitrage instrument for every market anomaly – why not education?

What would happen if teachers were given an equity position in their students? Isn’t this what families do to prepare their kids to take over the family business? Isn’t this what happens in corporations where executives pick proteges? Isn’t this what happens in politics where knowledge is traded among a closed group?

A school like Harvard University or MIT certainly hold and equity position in their students. What if every community viewed every child as an asset instead of a liability?

The Science of Change

Dan Robles — Mon, 17 Oct 2011 21:48:59 +0000

Calculus has been called the greatest achievement of the human mind. Yes, it is a little difficult to understand … until one day it becomes the simplest, most obvious, and glorious form of expression ever imagined. Like a musical instrument, there is a point where all the symbols and lines can disappear and the artist can express himself or herself in the medium of the art – leading to many more great achievements of human mind.

The Science of Change

Calculus is amazing because it can make the invisible visible. From sub-atomic particles, gravity, silicon circuits, diffusion of medicine through cell walls, to the discovery of new planets in distant solar systems – none of which are directly visible to the observer, yet their existence enables human imagination, innovation, cooperation, and social development at the most fundamental form.

Changing Wall Street

Wall Street lives quite comfortably in our homes, political system, our food , and our occupations – without being seen directly. Wall Street is utterly invisible. Most of their work doesn’t even happen on Wall Street. How did they accomplish this? How were they so successful in occupying Main Street without being seen?

The Trojan Proxy

Wall Street is a mathematical construct – it exists in the form of symbols and numbers, or, “proxies” for making stuff – but not the actual stuff itself. That is the vulnerability that we can easily exploit. If we are smart, we can dismantle Wall Street brick by brick and they will happily walk right through the door because “our door” – the knowledge asset inventory – can be made indistinguishable from any other “proxy” for making stuff. (I write extensively on this strategy in the prior posts).

There is a bigger message here that I hope does not get lost in the clamor. There is likewise a very easy way to occupy Wall Street, however, it’s going to take a little mathematical cleverness. How do we make them visible to us and ourselves invisible to them.

The key is that we need to change ourselves. We need to transform, not them. We don’t need to occupy Wall Street, we simply need to occupy Main Street because that is where they occupy us. It is not enough to marvel at our numbers, civil disobedience, and cardboard signs. We need a Science of change so that we can do so.

Supply and Demand for Knowledge Assets

Dan Robles — Wed, 12 Oct 2011 22:34:14 +0000

If we follow the Wall Street accounting model, the supply and demand for knowledge assets are cast against the factors of production; land, labor, and capital. The typical corporate human resource department looks to the community for labor units within commuting distance to a factory, and who are willing to rent their time in exchange a minimum amount of money.

But Land is Obsolete

Technology has made the idea of “land” as a factor of production almost obsolete. Knowledge assets travel over the Internet and can be deployed and organized in many ways across long distances without a factory. Indeed there are server farms and automation houses where things are made if needed – but these are hardly factors of production as they once were.

What exactly is a Labor unit again?

Machines have replaced much of what we once called “labor”. I am sitting at Starbucks where a smiling robot is the only thing missing from the age of automated lattes. The social, creative, and intellectual capital required to create, design, maintain, and serve the technology is what ushers us into the knowledge economy and the associated innovation economy.

Capital is arbitrary

Everyone knows that money is created out of thin air when someone allocates their future productivity to the bankers balance sheet in exchange for a place to sleep. When this game loses its entertainment value, “capital” as a factor of production will also become obsolete.

The Supply and Demand for Knowledge Assets:

Knowledge assets are deployed by teachers and replicated by student. Teachers represent the supply of knowledge and students represent the demand for knowledge. In between these two extremes are collaborations – that is, varying combinations of teaching and learning that ultimately results in a productive outcome such as a latte, automobile, or computer program.

If we sample a population of knowledge assets across some geographic area (Land) we would expect to find something that looks like a bell curve.

If the bell curve has a different shape, this tells us what things can be made and what things cannot (Labor).

So when people allocate their own productivity, they are in effect assigning their productivity to a community balance sheet (Capital). They are saying “this is what we are willing to make because we have the freedom, liberty, and we intion to pursue our happiness”.

Hardly a Wall Street model.

The result is that the social, creative, and intellectual assets of people must now replace Land, Labor, and Capital as factors of production in the new value economy. Trying to produce anything less would be inefficient in a Capitalist system – perhaps some may have noticed as much lately.

A Better Way To Occupy Wall Street

Dan Robles — Mon, 10 Oct 2011 18:40:43 +0000

What if I told you that we could occupy Wall Street without actually camping out there? In case you have not noticed, Wall Street occupies your house without you ever seeing any suits milling around your driveway. So what’s the plan?

In the Age of The Internet, redistribution of wealth should not be a very difficult thing to do, yet the approach is surprisingly low-tech. Just look at the pictures; if this is going to be our approach, then we’re in deep trouble.

Here’s the trick. Wall Street is built on a foundation where the factors of production are land, labor, and capital. All we need to do is shift the factors of production to something else. We don’t actually need to shift Wall Street, we need to shift ourselves.

The reality is that the today’s economy is built on social, creative, and intellectual factors of production – these are the factors of production of that so-called 99% of the value of our economy. It’s a knowledge economy, remember?

Now, notice how land and labor are constrained by geography, property laws, political districts, and “national borders”. Also notice that the accounting system (capital) is as anonymous as possible, if not shrouded in secrecy. Do you remember how Steve Jobs told us that it’s OK to copy good ideas?

First, we need to build a knowledge inventory of all the useful stuff in our brains and integrated by geographic proximity so we all can find each other. This is how we’ll mimic land and labor. Next, the knowledge inventory must be anonymous until the point of transaction – this is not for privacy concerns, rather, we need to do this to create scarcity (nothing personal, Zuck). This is how we mimic “capital”.

At the end of the day, your knowledge inventory is your personal API - you create your own value and integrate with others or withhold it as you wish…just like Wall Street. Of course, everyone would then need to become a corporation so that we can pay our fair share of taxes (but not a penny more). That’s code for “too big to fail”.

Have you forgotten about Wall Street yet? If so, it’s not too early to coin the term APIcracy.

It Is Time To Evolve

Dan Robles — Tue, 04 Oct 2011 21:13:01 +0000

I saw a Fox News commentary on the Occupy Wall Street movement. They interviewed a bunch of kids who were taking part in the parade and asked them a simple question: “So, what do you expect to replace Capitalism with?”

Then Fox, in their fair and balanced tradition, portrayed their subjects as the poster children of a failed education system (some children left behind after all) and further testimony to the failure of the Obama Administration. because obviously “These kids don’t know how the real world works”.

The Pundits can’t climb the tree any better.

Unfortunately, nobody else has an answer to that question either – none of the pundits or anchors produced anything except the tired argument that we tried Socialism and it failed so therefore more Capitalism is the only way to fix Capitalism.

It’s a Simple Problem

Market Capitalism only articulates value in the things that people make which can physically sit on a market shelf. Market Capitalism does not articulate the value of individual people; those things that people make in society.

Of course, it is also a double edge sword since those that really don’t produce anything – like hedge fund managers, pundits, and politicians – will become impoverished. Meanwhile, those who really do produce things – like teachers, engineers, and firemen – will become wealthy. So watch how the lines are redrawn in this debate.

How the world really works

The Internet and social media have shifted the factors of production away from land, labor, and capital to a higher order of human organization. This is what we need to be talking about. People today produce things with knowledge – social, creative, and intellectual knowledge. These are the factors of production for that 99% of the value that exists on Earth.

A Simple Solution

After many a blue face, I’ll say it again; there is no way to build anything meaningful without an inventory of parts. Car companies have inventories of parts, Banks have inventories of assets, even biology has an inventory of genomes – but there is no knowledge inventory for our communities. We don’t know what we do or do not know. We have absolutely no idea how valuable we are yet we complain that we’re impoverished. Meanwhile corporation create technology to replace people when people could be just as easily be creating technology to replace corporations.

How on Earth can we determine supply and demand for knowledge assets without an inventory? How can we expect to create any type of fair and rational economy from a bunch of invisible stuff milling around the parks? There is no escape from Market Capitalism and no path to Social Capitalism without a Knowledge Inventory, period.

A Stunning Omission

This is a very easy problem to solve and we have all the cards waiting to be stacked in our favor using the tools that are right in front of our collective noses. If we fail at something so simple, then we deserve to be enslaved. After all, 100,000 years ago, such people would have been eaten by tigers. It’s time to Evolve.

The Geek Shall Inherit The Earth

Dan Robles — Mon, 26 Sep 2011 22:32:16 +0000

Engineers are notoriously bad at organizing themselves – or maybe not.

Engineers tend to stay to themselves and are rarely mentioned in the domains of media, politics, Hollywood, banking, medicine, or law. Traditional engineering societies are weak and sparse. Nobody even thinks about paying them royalties for the satellites that carry our smart phone signals.

Some say that Engineers can’t see the forest through the trees. Others say that Engineers have little tolerance for banter, conjecture, diatribe and all the triviality of mixing with the rest of the world. Yet, few can argue that Engineers are the ones we all need to show up every day to keep the water clean, the airplanes safe, the code logical, and the law enforceable.

Money is backed by productivity, otherwise, nobody would work for it – think about that for a moment.

Why would anyone work for something that does not represent what he or she creates? However, few people notice that productivity is the domain of engineering. The machines that they create, the bridges that they build, the code they write, and the infrastructure they lay exists for the sole purpose of supporting human productivity.

Whose money is it?

So why are most engineers strangely silent in the emerging discussion about new economies, alternate currencies, and the New Value Movement? Who are these people and why should we care about them? I attended a lecture with Charlie Munger, CFO of Berkshire Hathaway who stated in reference to the Enron collapse “it’s bad enough when we lose the accounting profession, but dear God help us if we lose the Engineers”. Charlie cares.

We call them Geeks – but what is really going through their minds? What would happen if they did organize – or are they already? Where will they hide all the Value that bankers can’t find anymore? Or has the game already changed? Remember who inherited the hamlet of Hamelin.

A Radical Twist on Crowd Computing

Dan Robles — Tue, 13 Sep 2011 17:38:58 +0000

Social Flights is a Value Game. The objective is for communities to fill a private jet in both directions in order to achieve the best economics. This may be achieved through creative Game Mechanics where travelers, aircraft operators, tourism and hospitality vendors, and municipalities interact in their mutual best interest to perform a calculation in a radical twist on the concept of Crowd Computing.

But what if communities could organize themselves using their own data? This would introduce a great deal of innovation in order to solve a calculation that is otherwise performed by capital infrastructure such as structures, corporations, government, or in the case of Social Flights, a vast hub airport.

The Value Game is designed to be gamed by entrepreneurs where “True Value” is created through collaboration rather than competition.

If Social Flights can create a game where people share an airplanes, imagine that the same game can be played with any shared asset from cars, education, health care, food production, and even public infrastructure. Communities may perform the “calculations of economics” much like how traditional tribes allocate resources. Enterprise lacking in “socially redeeming value”, by definition, will fail.

So exactly how powerful are tribes?

As we all seen this year alone in the Internet Age, Social Currency can and does directly challenge dictators, militaries, financial systems, and governments across the globe. People are performing Crowd Calculations – communities are Crowd Computing. These ideas and many more will be highlighted by Innotribe at SIBOS 2011

Let me offer an analogy:

The economy that is denominated by Money, is a system built on 5 pillars that are perform the calculations of finance and economics. The pillars are integrated to support a financial system. These pillars are: a currency, an accounting system, vetting institutions, entrepreneurs, and consumers.

If any one of these pillars is broken, corrupted, oppressed or otherwise fails, the entire system falters. Enron presented a failure in the accounting profession. The mortgage crisis was the failure of the vetting mechanisms. Corrupt legal systems suppress entrepreneurs. Now the debt crisis is threatening the currency pillar. The currency crisis will threaten the consumer.

Suppose that these five old economic pillars could be duplicated in a some different way and then integrated to form an alternate system for performing the same calculations. It is no coincidence that many of the sessions at SIBOS2011/Innotribe correspond to the five pillars of such an economy.

Entrepreneurs: Social Data and Cooperation, Corporate Cultures

Vetting mechanisms: Banks for a better world

Accounting system; Big Data

Consumers: Digital Identity

Currency; Future of Money

Imagine this, if the organizations at Innotribe were to integrate to create a new economy that is only slightly more efficient the old system, they may become the mother of all hedge funds. Remember the dictator caught without social currency? At least half the money in the world will convert, capitalize, and securitize in social currency. We may not be that far off from that day.

The New Economies Track at SIBOS2011/Innotribe features the people and projects that are at the forefront of “The Big Integration” where the five pillars of a new economic system will integrate themselves to form a new economy to replace the old. It all starts with entrepreneurs such as those featured at Innotribe 2011 trying to figure out new ways to integrate the five pillars of a new economy.

New Economies; May The Best Street Win

Dan Robles — Wed, 07 Sep 2011 22:46:42 +0000

The great dream for new economies movement is that Wall Street has finally met its match from the vast interconnected social systems that now dominate communication, organization, and commerce.

The problem is that no matter what the New Economies Movement comes up with, Wall Street will capitalize it, commoditize it, securitize it, and sell it back to us for the price of our communities. Then they’ll build derivatives and options around it and wrap it all up in a nice hedge fund that transfers all risk back to us. The Street always wins.

So why can’t we do what Wall Street does?

At Social Flights we believe that we can provide 10,000 jobs across the United States by letting people sell options on aircraft seats.

How would this work?

The Hub and Spoke system consists of about 30 major airports in the US that act as hubs. The rest are spokes and many smaller cities are barely served at all. So unless you are flying between two hubs, you will always have to catch a connection, waste time, and incur social expenses.

For the price of a typical airport lounge bar tab, a traveler can buy an option to fly a private jet non-stop between their destinations. An option is the right without the obligation to take a position in the future. The option would be convertible, transferrable, and may even be exercised on a wide variety of schedules.

Calling all unemployed entrepreneurs

Suppose that I saw a listing on Social Flights for a private jet flight from Boise Idaho to Colorado Springs taking place in three weeks and costing 300 dollars. Since I know a lot of people in both cities, I can either use the ticket myself, or I have 3 weeks to sell it for, say, 500 dollars.

This is a bargain because there are no non-stop flights between these two cities and airline prices tend to increase as the departure date approaches. The private jet can do the trip in two hours whereas the commercial airline would take 8 or more hours. I could buy an option on that flight for, say 30 dollars and resell the ticket for a $170.00 profit. If I cannot sell the ticket, then I can use the ticket, convert it to another option, or lose my 30 dollars (just like the bar tab).

I am a Capitalist

In effect, I am rewarded for my size and quality of my social network. I am rewarded for my ability to research in the Internet to find likely prospects who would seek to travel at a time savings. I am rewarded for my knowledge, associations, professional skills, and ability to analyze data and organize people. I am rewarded for finding arbitrage opportunities in an inefficient industry. I buy low and sell high – I am a Capitalist

While this may not seem like a large impact, if 5000 – 10,000 people make their living trading Social Options, the market will shift. If Social Options can be created for aviation inventory, they can be created for all inventory. For the exact same effect as a Groupon, people can trade options on goods and services while hedging against Wall Street and restoring community Values.

Don’t just change the game, change the street that it is played on….

New Economies at SIBOS; The Metacurrency Project

Dan Robles — Fri, 02 Sep 2011 19:03:39 +0000

The New Economies Panel at SIBOS Innotribe this year in Toronto represents the most important elements of a new economy which many people believe is emerging to replace the old one that continues to crumble around us.

The common message of New Economy movement is the vastly expanded definition for the term “Value’ – far beyond that which can be articulated with money. Very few organizations hold this idea as explicit to their DNA as The Metacurrency Project.

Few can deny that the Sun delivers all value to our Earth. The Mass of our Universe provides the rest; Gravity, Motion, and time. In this context, money is a trivial device that simply articulates the relatively archaic things that humans can manage to conjure and horde from the vast natural resources that are delivered to us for free.

The idea that Energy can exist is many forms cannot be separated from the fact that Value can and must also exist in many forms. The challenge that we face as a civilization is to build an economy that articulates all Value completely and truthfully.

The Metacurrency Project has become a Worldwide conversation expanding the definition of value and building systems to articulate such value in communities, companies, and society.

I had the opportunity to meet Art Brock at The Future of Money and Technology Summit in San Francisco earlier this year. Art represents a very important voice in the discussion of new economies at SIBOS/Innotribe on September 19-23 in Toronto.

We look forward to seeing you in Toronto. If not, then thank you for continued interest and participation in the important subject of New Economies.

The True Economy, The True Value

Dan Robles — Wed, 31 Aug 2011 21:59:39 +0000

I am reading The New Capitalist Manifesto by Umair Haque in preparation for SIBOS 2011 where I will have an opportunity to join in a common conversation. I will be speaking on a panel called New Economies along with several other distinguished presenters (see Below).

New Economies = The Values

The most important thing about the discussion of new economies is the idea of Value. It is essential that we define Value much more completely than just those things that can be articulated with money and shift to include all forms of Value in our entrepreneurship. The Sun delivers value to the Earth. Parents deliver value to their children. Communities deliver value to society. A true accounting of all value is essential to the discussion of new economies.

The New Capitalist Manifesto is a hugely important book; Here are a few of my thoughts.

First; it provides a vital framework to begin accounting for what we call “True Value”; an accounting of real net value creation as opposed to borrowing, transferring, or destroying value that is not necessarily represented on a financial balance sheet.

Second; the new economy and emergent new accounting system will happen whether we like it or not. There is little that people can actually do to avoid it. The new economy is a matter of survival – it will happen at the speed and drive of survival (hence “Capitalism”). So make your choices now as these will define your future.

The third observation is that nobody is immune from the new economy. The more one resists, the more it will persist. The stronger that a country, corporation, or traditionalists hold to legacy ideas about linear value and forest-to-dump consumerism, the faster and more dramatic will be their demise.

So what does this have to do with Social Flights?

Social Flights is attempting to replace the horrific concrete wasteland of the command and control “Hub & Spoke” system with a Democracy. Our premise is that people can self-organize around two points and efficiently share an airplane that flies directly between them from smaller airports. In effect, we replace the infrastructure with cloud data to accomplish the same thing with a far superior customer experience, and therefor, greater true value.

Think about it; all of the world’s airlines are competing with each other in a race to the bottom around the Hub and Spoke system. The two largest aircraft manufacturers are beating each other up around the strengths and limitations of the Hub and Spoke System. The whole system is limping along on razor thin margins. Yet, the vast majority of “true and complete” Value of travel is the human experience and the value of relationships, communities, and their actions together. The only reason that Travel exists is being unceremoniously tossed out on the tarmac….

If you don’t listen to your customers, then at least listen to Umair Haque.

So, if you are a university, a corporation, government, or any institution dependent on physical infrastructure in order to match supply and demand while insulating yourself from competition, then you should be very concerned about the new economy.

New economies
Is money the only form of transaction value and wealth? What about social currencies? We will expose you to new thinking on new economies such as the trust economy, the intention economy, the relationship economy, the social economy and the ethical economy.

Already confirmed:

Jerry Michalski, Founder – The REXpedition
Art Brock, Co-Founder – Metacurrency Project
Dan Robles, Founder – Director – The Ingenesist Project
Umair Haque, Director Havas Media Lab and Author New Capitalist Manifesto > Via Skype
Gregory J. Rader, Blogger – InTheSpiral
Doc Searls, VRM initiative and Alumnus Fellow – Berkman Center for Internet and Society at Harvard
Craig Burton, Founder of Novell, and Founder of The Burton Group, [blog]

Another Opportunity To Observe Social Currency

Dan Robles — Tue, 23 Aug 2011 22:57:21 +0000

(I am sitting on a panel at SIBOS 2011 in Toronto Sept 19-21st speaking on the subject of New Economies – this post represents the angle that I take on the subject)

With images of people rushing into the Libyan dictator’s compound like the current from a great tsunami reshaping the landscape in a matter of minutes, I reflect on the obvious metaphor. A quick Google search on “Social Current” reveals almost nothing – except “Social Issues and Current Events”. Well, close, but not quite…

I hate to break the news to folks but Social Current and Social Currency are the exact same thing.

For example, the ex-Egyptian President had plenty of money and plenty of oil, and plenty of guns – all the markings of wealth and power. Yet he was challenged and defeated by Social Currency. If there were a strict market driven conversion factor for Egyptian Social Currency, it would probably comp out at around 100 Billion dollars. So there is a conversion factor in case anyone is interested.

Will the real economy please stand up

Anyone who does not believe that social currency exists today and is actively traded, stored, and exchanged in quantities far greater than financial currency, is looking in the wrong end of their binoculars. In fact, I would go so far as to say that the economy denominated in social currency is far greater than the economy denominated in financial currency.

Dollar spelled backwards is….

In the past, I have used the word “Rallod“ as a placeholder for all VALUE that is NOT directly articulated with Dollars. In fact, we could say that the Sun delivers Rallods to planet Earth and humans harvest what are called “natural resources” which are then converted to Dollars for storage, trade, and exchange. The problem is that Rallods don’t have a financial “system” of their own. Rallods have been invisible – until now.

Money can’t buy me Love…

Not to get too fluffy here, but try to produce an airplane, a sandwich, or a surgical procedure without intellect, creativity, compassion, empathy, ethics, social values, or community awareness. None of these things show up on the typical Wall Street Financial report balance sheet. However, the absence of these things can quickly shows up in the liabilities column when confronted by social current.

Syria is in the midst of a social currency conversion process as are Greece, Tunisia, London, Israel, and France, etc. Not to mention Yemen, China, Iran, and quite notably, the United States.

The Challenge then is to articulate ALL value in an economic system.

I believe this to be the genesis of the next economy. I can also say with quite a bit of optimism, that it is well underway, we have past the point of no return, it’s a done deal, we are all interchanging Rallods and Dollars every day.

People are learning how to store, and exchange Rallods. They really are – in fact, that’s where the majority of innovation in the world is occurring today.

**************

Already confirmed:

Jerry Michalski, Founder – The REXpedition
Art Brock, Co-Founder – Metacurrency Project
Dan Robles, Founder – Director – The Ingenesist Project
Umair Haque, Director Havas Media Lab and Author New Capitalist Manifesto > Via Skype
Gregory J. Rader, Blogger – InTheSpiral
Doc Searls, VRM initiative and Alumnus Fellow – Berkman Center for Internet and Society at Harvard
Craig Burton, Founder of Novell, and Founder of The Burton Group, [blog]

SIBOS 2011 – The Power Of Tribes

Dan Robles — Tue, 16 Aug 2011 18:34:14 +0000

I am deeply honored to be asked to deliver a keynote at SIBOS 2011 in Toronto next month. Normally, I would consider myself quite lucky to have 5-7 minutes to speak to the World’s premier financial services conference. However, I’ll be speaking against the backdrop of economic turmoil, political gridlock, and unprecedented strains on natural resources – across the globe.

The topic of the presentation is The Power of Tribes. While I’ll be representing a business application of this subject, – again, the backdrop for the Power of Tribes is Egypt, Syria, London, Wisconsin, Juarez, China, etc.

Why would they care about what I think?

I am aware that it’s unlikely that the financial industry will awaken some day and say: “Wow, those kids who marched for equality and human rights in the 80”s were right all along!”. “Yes, Yes, in order for the rich to live like we do, the poor need to live like they do and that’s not fair”. “Oh Gosh, let’s consult our engineers”. Uh, not a chance.

They want a mountain of New Gold to appear on the Horizon.

The financial services industry is looking for new Value – something to prop up the Old Value that money is struggling to articulate. As soon as I grab the mic, the audience will be saying to themselves “Ok, big guy, show me the money”.

Maybe I’ll suggest that Hosni Mubarack had no shortage of money or guns yet he was defeated by social (current) currency. I could build a metaphore of a world where social currency directly challenges financial currency, political institutions, and even military strength. Others have tried this path, so why would they believe me?

Perhaps I’ll speak through the reflection of a familiar mirror.

The financial industry is build on five pillars. If any one of these five pillars is corrupted, the whole system fails

1. “Currency” exists for the purpose of storing and exchanging “Value”.

2. Value of currency is verified by vetting institutions.

3. An accounting system articulates inventory of Value

4. A business model such as “buy low and sell high”

5. Entrepreneurs do the fuzzy math and accept risk

It is not hard to track any failed economy with one or more of these pillars collapsed, nor is it difficult to see the cracks in the walls of the remaining economies.

The Power of Tribes

What many people do not yet realize is that as the old economy weakens a new one is emerging in lockstep. The five pillars of a capitalist economy are being replicated in the social media movement:

Let me start in reverse:

5: Entrepreneurs do the fuzzy math – Search Engine Optimization

4: The business model is buy low, sell high – communities elevate social priorities

3: An Accounting system – trust, reputation, family, community, and influence

2: vetting institutions: Twitter, Yelp, G+, Quora, and many many more

Only after these components have developed to a sufficient degree and become integrated with each other, a social currency will emerge. It is wrong to say that a social currency comes first and all the rest will follow.

1. The new currency will come AFTER the integration of Social Media.

Convertible with money:

Keep in mind that dollars were once backed by Gold. Eventually, the need for gold convertibility became obsolete. Likewise, this social currency will be convertible with money, and eventually the need to convert to dollars will become obsolete. That’s the end game on the dollar

That’s also the Gold Mine on the Horizon…that’s The Power of Tribes

People Are Corporations Too

Dan Robles — Sat, 13 Aug 2011 18:51:18 +0000

Wow what a week. I though that I heard it all until Mitt Romney said “Corporations Are people”. Actually, I admire Mr. Romney but I do struggle with this interpretation for his sake and those who he represents – and possibly an opportunity lost to rise above the noise.

In a way, Mitt provides us with a looking glass into the fundamental differences between the rich and the poor. The rich see themselves as the proxy for the prosperity of the poor. Meanwhile, the poor see themselves as the proxy for the prosperity of the rich. Neither side admits that they need each other, but I won’t pretend that I can solve this argument any time soon. However, allow me to suggest that the winner of the debate will be the one that can evolve above the paradox.

The following video discusses how many components of a corporation – and government – are being duplicated in Social Media. The beauty of is that this great social innovation is available to anyone including the rich, the poor, the corporations, and the government. Oh, but wait – if the UK shuts down social media, they will effectively shut themselves out of the paradox, not evolve from it…Ooops. Be careful, Mitt.

So here is a video I made last year which, in a way, validates much of what we see playing out before us in politics, business, and social media.

OWN Your Travel Game

Dan Robles — Mon, 01 Aug 2011 19:28:36 +0000

Social Flight is unique in its purpose of organizing communities of people into powerful collectives who can influence markets, vendors, and especially prices. This opportunity arises because of extraordinary inefficiencies in the airlines, but also in advertising, communications, marketing and every industry where a broker stands between your intentions and a market for goods and services.

Why Google Plus?

It may take a while for most people to catch on to what Google already knows: nothing economic can happen until people get together to build something.

Suppose you set up Google Circles by Geographic location. Essentially, collect your home town friends, your college friends, your family branches, your company headquarters, etc., by geographic location.

Of course, each place where you have been has it’s own set of circles for things to do, places to go, and events to attend. Each place that you go is a market of goods and services that is willing to accept your patronage as well as the patronage of people in your circles.

Now suppose you overlay your data on your personal “interests” data:

This data set can include National Parks, affinity conferences, your Alma Mater “away” games, and seasonal recreation, for example. This affinity data may also include concert tours of your favorite bands, speaker tours of your favorite authors, sibling birthdays, or promotional campaigns for your company, etc.

These form your intentions:

By far the most powerful business intelligence data is for the product that you will buy next, the person who you will talk to next, the place you will go next, and the impression that you will receive next. This data belongs to you – like physical property – and YOU should be able to determine who sees.

YOU OWN your intentions data.

Now overlay your intentions over a map of services and vendors such as hotels, or NASCAR races any other Goods and services that someone may want to sell to you. Today, these vendors are paying a great deal of money to advertise their message to people who may never buy the product or create an unnecessary, and possibly negative, impression on those who would not use the product in the first place.

$400 Billion dollar yearly advertising spend

These vendors pay and extraordinary amount of money on business intelligence, Groupons, and social media campaigns trying to discover YOUR intentions data.

They want to know where you are, but NOW, you know who THEY are. You have every bit of information that you need about them to sell them YOUR product: your intentions.

Now you can simply ask them to bid for your intentions data and bid for your business – this is exactly what a print ad or TV commercial hopes to accomplish.

Who is ready to build these applications with us?

How Can Startup Fundraising be Gamified?

Dan Robles — Wed, 27 Jul 2011 17:28:10 +0000

This was a question recently posed on the website Gamification.org.

The interesting and hugely important thing about the folks at Gamification.org is that they are trying to bridge the reality chasm between entertainment games and economic games. This, I believe they are rapidly learning, is yet another game.

So, sure, I’ll play…

The questioner asks that the respondents keep in mind the things that matter when raising money. These are called the initial conditions:

Traction
Team
Technology
Validation

The hypothesis is that the way start-ups raise money today is out dated, inefficient and a huge time sink for entrepreneurs. Perhaps there is away the process could be made more fun for all parties, waste less time and still demonstrate traction/team/tech and validation.

No new game here.

These are the same initial conditions of the game that is currently failing many great entrepreneurs (ostensibly, gaming entrepreneurs).

Ask any child to create a game and they will almost always modify the initial conditions. If a playground game of tag is mismatched, they’ll play ball tag or introduce a boundary instead. If the ball won’t go through the hoop, they’ll change the ball or the hoop.

If you can’t win a game playing by the rules, don’t play the game or change the rules

Likewise, I believe that a great deal of the problem with start-up funding has to do with the astonishing absence of a knowledge inventory system – that is the first thing that needs to be built before we can approach a new answer to this old question.

A company like Boeing (for example) has an inventory of every rivet, panel, and wire that goes on an aircraft and they nurture that inventory with intensity. The objective is the ability to predict the likelihood that an aircraft can be built given the set of parts that exist in the inventory. The real problem is largely in predicting the likelihood that the knowledge inventory exists to turn all those rivets, wires, and panels, into serviceable aircraft.

This is not the way startup fundraising – or even the question above – is formatted.

A computer hardware engineer can look at an inventory of computer parts and tell you the specifications and/or range of devices that can be built. They can also tell you what parts they need in order to increase the probability of success and they can tell you what parts will be left over unused after the devices are created.

The analogous condition is that a fundraising effort would look at a set of knowledge assets in a community and predict what ventures can be executed successfully given the inventory. We should also be able to determine what knowledge assets are missing which would increase the likelihood of success.

An Idiot’s Guide to Probability and Statistics

The beauty of predictability is that these new enterprises can not only be capitalized, but they can be securitized and risk may be diversified. That is, they can be gamed. That’s the definition of money and that, I believe, is the objective of the question.

Build the knowledge inventory and all the money in the world will have no other place to go. That’s the game that we need to play right now.

Virtual Hub And Spoke System

Dan Robles — Tue, 26 Jul 2011 22:28:34 +0000

The Hub and Spoke system is a time honored formation of commercial aviation. People accept hub and spoke as the most rational way to organize people and planes much like they accept the corporation as the best way to organize production of goods and service.

Meanwhile, social media is challenging every assumption that we hold dear to our hearts as new applications role out which steadily increase the ability for people to organize their selves.

The newest applications such as Google + show us that people are the hub and their various forms of social networks are their spokes. A person has a group for their family, one for their friends, their colleagues, their schoolmates, etc. While G+ fatigue may wear in as people get tired of classifying their casual contacts, the real value of G+ may arise in the intentional Organization of people for social and financial efficiency.

The similarity between the airport and G+ Hub and Spoke is not a casual coincidence. There is a very real and physical connection between the way people organize themselves in social media and the way they organize themselves in corporate production and the way their organize themselves in air transportation systems.

Suppose we make the analogy that the person in the center is the customer, the circle that they belong to is the market, and the person in the market is a client. The analogy hold when we try to “preserve college friendships”. College is the social market and the friend is the mutual client relationship where the currency is a social currency.

The analogy is still very young, but it is truly profound. This way of thinking will drive a form of social organization that may rival corporations, government, and even international boundaries. It is also no coincidence that Social Flights has been modeling this analogy for the 2 years since we first started developing our business plan.

Today, Social Flights is working on some important concepts for defining Travel Tribe Leader functions. The objective is to duplicate the function of a “concrete” hub and spoke system denominated in dollars with a virtual hub and spoke system denominated in social currency.

Network Characteristics of Travel Tribe leaders:

Each Travel Tribe Leader is responsible for 10-20 city pairs from their own location.
Two travel tribe leaders for each city pair (one located at each point)
Travel Tribe Leader creates revenue by matching people and places
Builds tribal/shared knowledge
Redundant, opportunistic, and fault tolerant
Ideally suited for Twitter, Google + and Facebook Distribution Channels

Conclusion: The organization of people it figuratively (with G+) and literally (with corporations) is the exact same thing. This will become obvious when people discover the necessity to organize their selves into productive communities in the absence of corporations and government. But why wait – we can, and we will use social media to form a new system of social organization.

Citation: http://www.slideshare.net/padday/the-real-life-social-network-v2

BizDev with Cascading Info Game

Dan Robles — Mon, 18 Jul 2011 18:04:21 +0000

Social Flights is a complicated game. Aviation is a complicated business. This makes Social Flights a challenging business model as much as a great opportunity for those who can figure it out how to play for keeps.

The Challenge

The challenge is to bring on as many as 5000 independent Travel Tribe leaders distributed broadly across a wide geographic area. Their task will be to strategically build flight plans for private aircraft in their communities. Community leaders will be compensated financially for driving revenue … much is common to a traditional sales channel.

However, each of these community leaders will have already accumulated a vast set of strategic knowledge and experience that can benefit Social Flights across the system. Likewise, Social Flights needs to bring each of them up the ladder of domain specific knowledge in the aviation business.

For compensation, Social Flights offers a tiered affiliate program that pays out various levels of commissions on flights booked according to the affiliate’s tier. One concern is that this strategy may not create an incentive to share information broadly if one is protecting their own tier standing or their own order of influence.

Cascading Information

Another approach would be to use a cascading information system. This is a gamification theory that suggests: information should be released in the minimum possible snippets to gain the appropriate level of understanding at each point during a game narrative.

Initially, information would be released by social flights in our initial training program. Later, other players of the game can release information to each other in specific packets defined by the flight scenario. Such packets of information can be rewarded with other packets of information – or access to more scenarios. The Cascading information theory promotes loyalty, engagement, influence, and time involved in the game of building flight plans.

Gaming the game:

From the onset, Social Flights encourages gaming the game. This means that we expect to learn a great deal about our business by watching other people play it. There are far too many scenarios and permutations of business strategies for us to predict how and where they would apply. All we can do is specify a baseline game scenario form and watch the ways the game is gamed.

In a sense, Social Flights would also be subject to the Cascading Information Theory, thus demonstrating how a corporation would enhance their own engagement, loyalty, influence, and time-quality in the communities where they operate.

(reference: Gamification.org – wiki; Cascading Information Theory)

The Raw Material of Social Org Games

Dan Robles — Thu, 14 Jul 2011 22:26:29 +0000

Fibonacci Trust Curve

Trust Scarcity?

This article is a loose argument related to trust scarcity in social organization games. Rewarding trust in a social game is a difficult thing to do unless certain agreements and institutions are in place.

The Social Value Game

Social Flights will be introducing some game mechanics to provide incentive for people to interact with each other to form specific flight plans This will also include vendors and operators who would support their travel intentions with goods and services.

We want to dis-aggregate the incentives from a specific flight; in other words, a player does not necessarily have to be on the flight in order to receive a benefit from organizing it.

As the game develops, all players will simply keep an eye out for travel opportunities for trusted others in their social media experience. By helping their social circles to find travel opportunities, they will receive rewards which they can use when their own “perfect flight” begins to form.

Technology is not yet here, but getting close…

I would like to think that the technology has arrived which will allow people to form flights in social media, unfortunately, this is not the case. The problem is that big data has become big business. Social media platforms are funded with Data Dollars – that is, organizations who capture, combine, sell, or otherwise exploit personal data and trends in exchange for money.

Spiral of trust

When a person states their intention to fly to a distant place, this creates immensely valuable data. Such information is highly specific and even quite intimate because people share their hopes, dreams, and aspirations when they meet, travel, learn together. For this reason, Social Flights game data will be scarce, remain private, anonymized, or normalized so that it can remain in play indefinitely. There needs to be a great deal of trust in that network and, in fact, a disincentive to casting a broad public net.

Trust as Raw Material:

Social Flights has an internal social network that allows people to communicate anonymously
Travel Tribe Leaders are trusted members in a community who operates with trust, integrity, and respect
Game mechanics can dis-aggregate intentions from specific flights
Game data will normalize outcomes into “probabilities” that mask mask social data as numerical data for future games
New Social Media applications allow users to form travel circles of trusted persons with whom they are willing to share flight plan intentions

It is fairly easy to see that no single social network device will serve every requirement of a social economy – nor should their be. Instead, the integration of several devices which identify, create, and deploy trust as the raw material, will allow people to go wherever they want to go and build whatever they want to build together.

The Game and The Counter-Game

Dan Robles — Thu, 07 Jul 2011 08:01:17 +0000

The term “Gamification” is pretty cool, except that it is meaningless. Anyone who has ever worked a day in his or her life knows that the World is already gamed. Anyone who follows politics and world events sees the game playing out constantly. Everyone, including the winners, know that the game is stacked. The last thing anyone needs is another game layer.

If you are like the majority of people on Earth, you are given a game that you can’t win playing by the rules. If you are like the majority of people on Earth, you would do anything for a chance to play a game that you CAN win. Imagine the value of an IPO for a gaming company with that prospectus.

What is a Counter Game?

Wikileaks – love them or hate them – is a Counter Game because they turned the lights on a game that was being played in the dark. Bloggers play a Counter Game because media was editorialized by powerful interests. Twitter is a Counter Game because it drives the narrative instead of being driven by it. In fact, any place where there is a broker – someone or something that benefits from you NOT having complete information – is an opportunity to introduce a Counter Game.

An astonishing array of Counter Games is forming in social media and the brokers are falling out of the sky like hailstones. Power brokers, mortgage brokers, energy brokers, media brokers, even Google is gamed by Counter Gamers. The better they get at hiding information; the better the Counter Gamers gets at rooting it out. The harder they try to control a message, the better the Counter Gamers gets at disclosing the truth behind the message.

The game creates the Counter Game.

Likewise, to kill the game is to kill the Counter Game. As such, the only way to kill the counter-game is to kill the game. Think about that for a bit…Do we really want to do that?

The Holy Grail of the Counter Game is the global monetary system. Money is supposed to represent human productivity; otherwise people would not go to work to make things that everyone else needs. The Game has caused Money to become increasingly divorced from actual productivity. People who produce the most value are exploited while those who produce the least are most grandly rewarded. The Game is stacked with money.

The Holy Grail of The Counter Game is to replace monetary currency with a True Value Currency.

The financial system stands on 5 pillars: currency, inventory, vetting institutions, entrepreneurs, and value arbitrage. All of these are slowly being replicated, mimicked, or duplicated in Social Media. When the 5 pillars integrate in social media systems, a new currency will emerge. People will use it to store and exchange the value that they create through their work. It will be a no-brainer

The Value Game

The Value Game is outlined in this short video using the now proverbial “Corporate Jet” as the turning point in the global economic paradigm. The Value Game does not kill the Financial Game, rather, it challenges, corrects, and improves it. The Value game has reached a critical milestone – it has been funded in dollars by investors.

This is not insignificant.

Why This Bubble Is Completely Different

Dan Robles — Tue, 05 Jul 2011 21:34:12 +0000

I had a discussion with one of my partners that we need 2.5 million users and Social Flights will manage itself. The partner said, “You mean 2.5 million dollars”.

No, I said, “I need 2.5 million users”.

The partner said tersely, “No, I really think that you need dollars.”

Again, I replied, “I need users…. “

This went on for a while until we both got it: The value of Social Flights is contained within the users, not within the dollars. After that, the conversation could progress in a meaningful way, priorities found their place, and the teams found their roles – including the investors.

Nothing economic can happen until people get together to build something

Financial analysts are aghast at the magnificent valuations that social media applications are delivering; P/E ratios of 1000, valuations of 100 dollars per member, billions of dollars per billion time hours in game play - these are not the ratios that they teach in B-school. Is this crazy or does it make perfect sense?

The Great Rapture

While highly unlikely, suppose the Almighty Father called upon all good and pious dollars to ascend unto heaven in a glorious rapture of currency – on a single day, all money disappears from the face of the Earth. What would be left? What happens next?

At least for a little while, I’ll still be sitting in this café typing a blog post. The value of the education and social network of the person who I will be meeting for lunch will still be intact. The value of the roads, bridges, schools, and highways would remain intact. The value to teachers, firefighters, and doctors will remain. The sun will shine and gravity will continue to act on matter. The money may go, but a LOT of value remains.

No Such Thing As Free Lunch

Of course, things will quickly devolve when I tell the café owner that I can’t pay for lunch because my money has been raptured. Of course that would seem like a relatively minor problem given the fact that their money has been raptured too. In fact, so has their supplier’s money, and their Bank’s money. Obviously, there can’t be a bail out because the government has no money either.

Each of us would probably stare at each other for a few minutes until somebody asks the other, “well, then, what do you have that I can use?” Once that conversation is exhausted, we’ll move on to “Who do you know that has something that I can use?” Etc.

The mother of all hedge funds

If this were a game, the person that knows lots of people who do useful things would stand a greater chance of being served lunch than someone who is isolated and disliked – no matter how much money they once had before the rapture. Likewise, if you have a lot of money, what “Bank” would you put it in? What “Stock” would you buy?

This bubble is different.

It may be that the dollar is in a bubble and the true value of our economy is stored and exchanged in communities of people enabled by social media. Those magnificent valuations in social media companies may actually reflect true value and act like a huge hedge fund on currency in the absence of any other plausible financial instrument.

As our noble politicians continue to play their game of chicken with the productivity of honest, educated, and productive Americans, they fail to see the polarity shifting away from money and into “true value”.

The value is in the people, not in the dollars. now we can have a different conversation about how to manage ourselves.

When The Customer, Supplier, And Competitor Are The Same

Dan Robles — Mon, 27 Jun 2011 18:54:43 +0000

NPR ran a story today about how drug companies are not the only ones making money inventing new medicines for the market. A man in Massachusetts has brought three drugs to market almost on his own.

His process is the same as the big drug makers, but he farms out each aspect of the process to independent labs and specialists. When the drug starts to succeed in trials, he sells it to one of the big companies.

Who competes with whom?

This is an example of how human infrastructure can replace physical infrastructure. The standard process for creating a new drug is to build a large building and fill it with smart people and expensive equipment and surround it with parking lots. The cost can easily exceed 60 million just to bring a drug to trials – the man in Massachusetts can do it of less than 6 million.

Mitigation of risk, waste, and social burden

Not only are market victories less expensive, but so are market failures. Hundreds of thousands of hours are saved in commute times and millions of miles stay off the freeways. “Independent Lab Specialists” are in fact, independent and don’t need to migrate from company to company chasing the next project.

As the article states, every step in the process for approving a drug is the same – without the unnecessary physical infrastructure. Sure, virtual work has been around a long time, the difference is when the corporate structure itself shifts to a series of small integrated corporations.

If virtualization can revolutionize the medical industry – it can revolutionize all industries.

Social Flights is attempting to revolutionize the Aviation industry in a similar way. Large Hub Airports represent physical infrastructure through which people and airplanes are sorted and matched. The majority of US commercial traffic passes through Hub Airports. Yet, the majority of passengers are forced to drive a substantial distance to reach a hub departure. Then they fly to a place that they have no intention of going only to transfer to another plane that also is not going where they intend to go. Finally, they drive a substantial distance to get where they really want to go.

The congestion and physical footprint supporting large airports is substantial. The burden on both the local and distant communities served by the hub airport is severe. Thousands of people and vast resources are deployed to support the infrastructure, not necessarily the value proposition to the passengers or the communities.

The Airlines need to understand that their customer is the community, their supplier is the community, and their competitor is the community. If they lose track of any one of these pillars, the system will become ripe for disruption.

The Human Infrastructure Game

Dan Robles — Sun, 26 Jun 2011 00:44:13 +0000

Social media is emerging as a tool that may replace corporate and physical infrastructure of market capitalism. Social Flights is attempting to sort and match people, airplanes, and destinations with community organization and interaction rather than the massive infrastructure of Hub airports.

Social flight introduces a Community Leader to the “last mile of social media” who can interpret and manage Value Game data to drive social and financial revenue. In order to articulate this real-life gaming system we need to specify a baseline game scenario such that all future “real-life” scenarios will simply be some unique variation on the baseline game.

The Baseline Scenario

Consider a condition where 4 persons (group A1) from a metropolitan area (point A) self-organize to initiate a flight plan to another metropolitan area (point B). An 8 passenger jet is available at the local airport near point A. The group seeks to return 3 days later. Price sensitivity is high.

The responsibility of the Community Leader at Point A is to:

1. Deploy social media strategies to find 4 more people to fill the remaining seats.

2. Contact Community Leader at point B to notify them of the empty leg that will originate there (when aircraft returns to base).

3. Coordinate with Community Leader B to promote vendor attractions that influence 8 new travelers to fly the jet back from Point B to Point A.

Three days pass and Group A1 needs to return home from point B:

1. Coordinate with Community Leader at Point B to determine who will originate the flight plan and who will own the resulting empty leg (the passengers are agnostic as to where the plane originates).

2. In either case, Community Leader B will deploy social media tools to fill remaining empty seats if any.

3. In either case, Community Leader A will use social media tools to fill the empty seats if any.

Variables:

In this scenario; 32 seats must be filled to support a flight plan for two round trips in an 8 person aircraft AND the 3 steps outlined for each and every flight remain relatively constant – only their order may change. Most of the variables to the baseline scenario are factors of social influence and may therefore respond to game mechanics and rewards, i.e.; the number of initial passengers, social draw in each community, 3rd party vendor incentives, social influence of passengers, price sensitivity, traveler schedule, etc.

Re-introducing Human Infrastructure

Social Flights needs game data from which to match supply and demand of corporate resources. The Community Leaders need game data to match supply and demand of social influence. Finally, the passengers and support vendors need game data to match supply and demand of social value, etc.

By structuring the game around a baseline scenario and introducing “Human Infrastructure” responding to game data, we hope to increase our likelihood of replacing physical infrastructure in the operation of point-to-point air transportation.