How to Deal With a Fast Changing World with Azeem Azhar
Graham Allcott 0:07
This is beyond busy. I'm Graham Allcott. I'm the author of a number of books, including the global bestseller how to be a productivity ninja. And I'm the founder of think productive. We help people to make space for what matters and get more done. And we partner with some of the world's leading companies who share our mission to transform the world of work. Beyond busy is where I explore the often messy truths and contradictory relationships around topics like work life, balance, happiness, and success, and explore with interesting people what makes them tick. In short, this is where we ask the bigger questions about work. My guest today is Azeem Azhar. Azeem is a serial entrepreneur, a journalist, startup investor and technologist and is the founder of exponential view, a weekly email with 200,000 subscribers, including many of the leading lights in tech, his new book Exponential is a fascinating look at the rise of rapid growth technologies and industries. And really, it's a must read for all of us right now, if you want to keep pace with the rapid changes happening right now. And perhaps even more importantly, what's to come. So in this episode, we talk about exponential technologies, and is not all about AI. As he talks us through what he calls the exponential gap, we talk about the future of work, adapting to shift in power, and whether he's optimistic or pessimistic for the future. This is Azeem Azhar. Welcome to Beyond Busy. How are you doing?
Azeem Azhar 1:38
I am doing super well. Thank you, Graham,
Graham Allcott 1:39
I have to say, when I got the pitch to have you on the podcast, I was I was fairly intimidated. I have to be honest, by having you on just given the the huge, just intellectual range and complexity of what you're talking about. But what I'll say is, you just you explain it all. So well in the book that I actually feel like, I can have a proper conversation with you about this. So this is the book exponential thinking. And I just think it's a really fascinating book. So let's start off why what I generally do at the start of being busy is ask people to just tell us a bit of a story about their own background and career. And the way I thought I would do it with you would be to talk about a little quote from the book. So you talk about this idea that intellectual life in the UK is split between the worlds of literature and the world of technology. And increasingly, they just don't understand each other. And maybe this is your USP, but you've kind of got one foot in both worlds. So do you want to just start with just a bit of background about, like, who you are and what you do, but from that kind of standpoint, so you're sort of foot in the world of literature and then your foot in the world of technology?
Azeem Azhar 2:53
Yeah, I'd love to do that. No, thank you. You know, it starts from where I was born. And when I was born, I was born in Zambia in 1972. And my dad was working out there as an accountant, but he's a rural economist by training and he was working for some bit of the British government to help Zambia in its its development, and he was building some economic institution. And that's a bit social sciences, in a sense. And my, you know, my mum was interested in economics, and she had been a university lecturer, and a teacher. And so there's a little bit of the sort of letters over there. But I was also born, the year after the Intel 4004 microprocessor was was released. I knew about the fact much later, but I grew up in the 70s with space, opera, science fiction and computers turning up in in media. And in a bind. By nature, I'm a more of a scientist and more of a technologist. And, but my, my family kind of heralds more from the social sciences, and my, you know, sisters, were lawyers and studied English and things like that. And so I, from a young age, sat between these two, these two arenas, and that kept on through through school and through university. As a, you know, high school student, I spent a lot of time doing the sciences, and we had great computing facilities, and I got to play with computing. But I was also a little bit insecure about the fact that kind of scientists was seen particularly by British culture at the time as a bit sort of nerdy and dorky you know, sir, Clive Sinclair was, you know, the, the hot Board of technology. And, and I think that insecurity and a long term interest in in current affairs kept me interested in politics and economics and history. And so when I went off to university I actually started studying law I changed after a year or So, rather than the sciences and through my, my life, I have always really occupied both of those domains. And it's never really clear, if you look at the book on my bedside, whether I'm going to be reading, as I am, at the moment, the book on on Jennifer Doudna, the inventor of CRISPR, or whether I'll be reading a history book, I'm not sure I'm particularly good at either of the subjects. But you know, you do something often enough for more than 40 years, and you get some fluency in it. So it's not done through design by any means. Graham, it's just, it's just been the story of my of my life. Yeah,
Graham Allcott 5:47
let's just pick out a couple of experiences that you've had in your working life. So on the technology side, so you're the founder of, is it for startups, it's full of sound effect. exits, to Amazon and, and Facebook. Among those,
Azeem Azhar 6:04
the exits to Amazon were companies i'd invested in and worked at my company of mine that had a sort of useful exit was bought by a business called brandwatch, which is a marketing technology company that has now been bought by somebody else, you know, that's how this happens. The Turtles, turtles,
Graham Allcott 6:25
yeah. And what what did you learn from those experiences? And so obviously, you've got experiences of being a founder of startups, but also an investor in them? How would you describe that world right now, and what have you learned,
Azeem Azhar 6:38
are super, super hard. They are really, really difficult. They're not like normal businesses. I writing a book is hard. It's something that you understand very well, with all the success you've had, I would say the hardest moments of my writing my book, were a bit like a typical Tuesday afternoon, running my startup. And so the depths of the emotional range, you get taken through in an afternoon or morning, let alone over the week or the month is enormous. And the reason it's it's challenging is that no one knows the answer, because you're building something that hasn't been built before. So not only do you not know what you need to build, you don't know how to build it. And you have to Bert bring a bunch of people on that journey with you. And you have to motivate them, you have market challenges, you have technical problems, and you have people problems. And at the same time, you've got to hit milestones, given the funding that you have available. And it's really, it's really intense. And the other thing that you know, is that you know that you're not special, that the fact that you have figured out that this technology could meet this market need and create a new product means that 1000 other people have figured it figured that out. And at least half of them are much smarter than you. And if those half who are smarter, or third have built successful companies before. And if that third, who built successful companies before, and so on, and so on it goes. So you find yourself in this really complex domain that is very, very demanding in in all sorts of ways. And then on top of that, essentially, you're a businessman. And like any businessman, whether you run the greengrocer on the high street, or an insurance company, or you're running an airline, the emails never stop, and you never stop thinking about these problems. But they're pretty fundamental, and they're pretty critical. So it's a really hard thing to do. I'm not special in having done it. I've learned a lot from having done it. I respect the people a great deal, who who do do it and do it. Time and again, do you
Graham Allcott 9:00
do you feel like you know, you're just talking there about how a lot of the the other competitors will be smarter than you and they'll have run businesses before and all that. Do you think there's a sense that do you think generally the cream rises to the top? Or do you think there's a lot of luck? How do you describe that sort of landscape in terms of success, and which which companies ultimately make Well,
Azeem Azhar 9:21
I wish I knew that secret to the economy. itself being sort of transformative? No, I mean, I don't really know. I think you you identify the many, many different qualities that founders can have. I was very fortunate to meet some amazing founders in in the over the last 25 years and I spent three years working with some exceptional investors called venture capital fund called kindred, who are really people driven investors and I learned an awful lot from them. And what I noted was that there was no real template or caricature. But there were certain types of things you looked for, you know, you looked for a kind of relentless energy, you looked for a person who was a fountain, not a drain, you looked for somebody who had some stamina, you look for somebody who was really thinking in tremendous detail about this problem, and could articulate it and articulate where it might go. But you also look for someone who was who was coachable. And there were many other qualities, and it certainly wasn't a checklist. So I think in general, while there's a lot of luck in startups, the ones that rise to the top are run by people who are very, very capable. That doesn't mean that we're going to succeed. And it doesn't mean that we're more capable than people whose companies failed. But that there's not a lot of luck. I mean, it's not that you just grab some random off the street, and, you know, there's a chance I'll create a successful business there that will that won't, that won't happen. Yeah.
Graham Allcott 11:11
Interesting. So let's just before we get off this, this whole topic of the the intellectual split between literature and technology, so you've also on the other side of that, you've been a journalist, you're a fellow of the RSA, you did PP, Oxford, and also advised people at the World Economic Forum and PwC and venture capital, as you mentioned. So when you think about literature and and technology, why do you think there is this? You know, this kind of, and when we say literature, I guess me also talking policymakers, politicians, those people are making decisions about the economy and the way that we live versus technology. Why do you think there's this this kind of disconnect, and why don't they understand each other better?
Azeem Azhar 11:54
That's a really great question. I mean, the analysis first comes from CP snow, who was somebody who's sat across both those areas, or from a lecture he gave the 60 years or so ago, maybe even 70. Now, and it was really about, I think it's to do with cultural heritage, and how we talk about the things that are important, and what it's okay to say and get away with. And so when I created my first company, which was just before or during the.com, boom, I remember the CEO of one of the very, very big British retailers saying, I don't know how to use a computer, and you do it as a matter of pride. And I, you know, I'm not an expert in here, but this is just my sort of anecdotal view, which is that in the, in the UK for some reason, for a long time, we dumbed down science and technology, despite the single these incredible research universities. And we played up the the sort of politic political game, and the policy game. And we played down enterprise as well in our media in our reporting in the kind of heroes that we, that we created. And we caricature people as as boffins and weirdos, frankly, and so that that then I think gets reflected in, in kind of cultural norms, it gets structured, in schools and in universities. And, and so the cycle continues everything what we've done recently, which is to argue in the UK, for much, much more stem science, technology, economics and mathematics is kind of helpful from an industrial standpoint, like we're trying to get people to have these, these very applicable skills, more of them, but it actually doesn't tackle the more holistic interdisciplinary thinking that I think people need to have, which is the need to have an appreciation of history and ethics and of politics and how politics reflects in the world. And they need to understand the nature of art and how art turns a mirror on us. And can be very, very insightful, and just, frankly, just enjoyable, alongside having functional competencies in the domains of science and technology, and, and maths. And one of the things that's come out of COVID is that we all now have a much better understanding of DNA, RNA and immune systems that we did going in, arguably, as right thinking citizens, we should have already had that level of understanding back in 2019, because that is modern life. Chrissie and and so, you know, this doesn't for me get tackled by funnelling students into STEM. This is much more about saying, you know, what are the skills and the knowledge that somebody who has resources and wants to be active as a citizen needs to have. And I do think they need the critical thinking that accompany this sort of interdisciplinary approach.
Graham Allcott 15:23
I love that, as you describe the sort of interplay between, you know, art, holding up a mirror and giving us the guidance around ethics and stuff, and then obviously, just the just the sort of driving progress that we get from science, I just think it's, it's such a lovely mishmash, as well to think about it in that way.
Azeem Azhar 15:44
And so many artists were scientists, and so many scientists were artists, I mean, the obvious one is, you know, is Da Vinci. Of course, there is a really important relationship with the humanistic dimension of, of a lot of this, that we, I think we miss in society, if we think that we can turn everything into a machine and engineer our way out of it. And I think that's what roughly speaking, the the arts is extremely good at.
Graham Allcott 16:16
Yeah, for sure. And I guess, like a, sort of, like, an undercurrent of the book. And something that I just kept thinking about, as I was reading it was, was just about power and sort of powerlessness of people versus the power of people. And that just felt like a really strong thing, which we'll maybe come back to, and just get a bit more. So let's just talk about a couple of the definitions here. So the answer kind of surprised me when I read the chapter. But do you want to just talk about what are exponential technologies?
Azeem Azhar 16:45
Yeah, so um, you know, if we think about a technology like that, like the car, will the internal combustion engine, as people work with it, every year, the next internal combustion engine should be better in some way. And by better, it should be perhaps faster for the same price, right. So your price performance improves, and most of the technologies we've dealt with in the world do improve, and they those improvements compound over years, but the annual improvement is quite small. It's, it's like our current savings accounts, right, where we're getting point 1% interest. Now you and I are Men of a Certain Age, and we remember the days you could get 10% interest in a savings account. And I say an exponential technology is a technology which improves at 10% or more on a compounding basis, every year for many, many years, decades. In fact, and the reason that I choose that is because you very much are getting to a point where you get so much more, but within living memory. So while cause the efficiency of a car engine has improved since the 1890s. It did say really quite slowly. And frankly, most of us don't really remember how much less efficient cars were, you know, 15 years ago. But if you look at computer chips, computer chips, essentially double in performance, every couple of years for the same price. It's a 41% annualised improvement. And that is really, really remarkable. It means that you know, for the same dollar cost, you will you will get up hundreds or 1000s, or millions of times more computer processing if you in 15 years time or 20 years time. And that has really, really unsettling effects. What it essentially means is that something that is today, too expensive to do in 10 or 15 years time will be so cheap, we won't even think about it. And that's why I'm holding up my iPhone right now, many of us have supercomputers sitting in kitchen drawers that we no longer use. And I say they're super computers, because an iPhone six is more powerful than the most powerful computers of my teenage years anywhere in the world. And that is, in a sense, the heart of that the exponential age is that we have many technologies that are generally applicable, that are improving at these exponential rates.
Graham Allcott 19:20
Do you want to just talk about those kind of less, less traditional, less, less well known exponential technologies?
Azeem Azhar 19:26
Yeah, I mean, you know, the one we all know is is that the chip and Moore's law and you know, in the book I talk about actually the, the kind of limits of Moore's laws as something to help us understand why chips get get faster. But what we what I found in my research over the last six years was that there were lots of other technologies that I put in three rough families, energy biology and manufacturing, that we're also getting seeing exponential improvements. So if you take if you take energy and it turns out that At the amount of power you can get from solar grid, right, that's taking sunlight and turning into electricity. For a given dollar is improving at an exponential rate, it's in the 20s of percent. And I'm so sorry, there are so many numbers in the book that I can't ever always remember the exact number. But you know, by the book, read it, it's in there. Or if you take a look at something like lithium ion batteries, for more than a decade, the amount of storage capacity you get, for every dollar of lithium ion battery you buy has increased by 19% per annum. And so that is, that's also an exponential technology. So it's really interesting that these technologies within the energy space are many examples where they're seeing these exponential improvements, which means an exponential price declined. And it means something over the course of a few years, goes from being too expensive to being cheaper than the alternative, which is what has happened with wind powered electricity versus fossil fuel powered electricity. So the energy domain is is one and it's super, super important. And it means that today, the cheapest sources of electricity anywhere in the world are renewable. And they're only going to get cheaper. And we're going to see the same curves happening in many types of storage. The one that's most bonkers. technical term that bonkers is what's happening in the realm of biology. So for many of us biology, was this kind of weird, is it a science? Is it not a science, you know, why are we throwing a quadrat in a field and counting insects, right, that's what I remember of biology. And in the last 30 years, our biology has transformed into an incredibly complex, nuanced quantities of science, through our understanding of the gene, the genome, proteins, protein engineering, the way the genome expresses itself, through epigenetics, and a whole set of other things where we've taped been able to take a kind of engineering and systems approach to this amazing miasma of things that make us us. And, and so within the realm of biology, there is a set of technologies. And I'll just pick out one which is, which are improving at exponential rates. So the first complete human genome sequence was delivered sort of in June 2000, it taken about 10 months to come together. And this first draft of our genetic script had cost about $300 million. And it needed some additional refinements and a bit of polishing for another 100 and 50 million bucks. So it costs around $500 million, maybe a billion dollars to sequence the first human genome and it actually was kind of incomplete. And it's only been in recent weeks, we've we finished that task by August 2019, the cost to sequence human genome had dropped to $942. So that was an enormous improvement, more than 100,000 fold improvement in 18 years. And what happens when that that occurs, is that you take something that only governments will do once in a while, because it costs half a billion dollars in something costs 1000 bucks, which can be done much more often. And it's still getting cheaper. We've seen some people claim $100, to sequence human genome in 20 2021. And that price will drive drive further and further down towards, you know, $1 or less, we only need our genome sequenced once anyway. So at some point, it'll just be obvious to sequence everyone's genomes for whatever use we choose to, to put to it. And what's interesting about why that happened, why that price decline happened. Partly it was related to a number of different exponential technologies in computing. So reading the human genome takes a lot of storage and storage was an exponential technology. processing, it takes a lot of
Graham Allcott 24:12
because it's just like billions of numbers, it's billions and
Azeem Azhar 24:16
billions of letters right? At first, you need to store that data, if you remember the film. And yes, it's a lot of storage. And it's a lot of processing. But we also got really, really good at producing the chemicals. And those got better. And the combination of all of that is what made allowed the price to decline 100,000 times and why it will decline another few 100 times over the coming the coming years. And that's really remarkable because you'd never think that something is complex and wet and messy as you know, the genome could lend itself to an exponential technology.
Graham Allcott 24:58
Okay, so I'm going to end erupt the podcast which you know, I don't do very often. And that must mean I've got something very important to share with you. So what I want to share is I've got these two really big events coming up, and I would love you to join me. The first is the Graham Allcott. Productivity masterclass. It's a face to face in real life event. And it's always typically a small group, so no more than about 30 people. And we're in his LinkedIn at the lift in his LinkedIn, it's on Friday, October the 15th. And we'll be walking through all the stuff from my book, How to be a productivity Ninja, my best selling book, over 100,000 copies sold, we've been in in some of the biggest companies in the world, from Google, to Barclays, to British Airways to Disney, we've been we've been all over the place. And we are bringing this stuff to you. So if you want to come and get involved, it's Friday the 15th of October 2021 lift in his LinkedIn. And it's one day with me basically walking you through all those different key habits of productivity, we talk about capturing information, how to organise stuff, doing weekly reviews, how to get over procrastination, email overload, it's all there during the day. So if that sounds of interest, if you're a fan of my staff, and you want to, you know really go deep in terms of implementing a lot of this stuff yourself, perhaps you've read productivity Ninja, but just never really got around to it. And you just want to day with me to really start to make some of those things stick or you've got particular questions, then yet the Graham Allcott, productivity masterclass is probably for you. And there's also still some earlybird tickets, there's also discount tickets, if you work in the NHS, if you work for a charity or if you're on your own dollar basically, as a freelancer. So that's all done on an honesty basis. So just basically book whichever ticket applies to you. And if you go to Graham Allcott, calm and then click the little button at the top for master classes, you'll find all the details and be able to book your place on that one. And then if you can't join us in London, then we're doing an online thing, which again, I do, I do this once a year, it's called six weeks to ninja. And this year, it starts on Thursday, the fourth of November 2021. It's a couple of hours on a Thursday evening. And the idea is that we again, run through all the same kind of stuff, but over six weeks, nice watsapp group going on to keep everybody accountable as well. And, you know, really, it's a chance to, to go through it at quite a relaxed pace, I sort of put everyone through their paces in terms of what we do during the two hours. But doing it over six weeks, I think is a really nice, sustainable way to make a lot of these new habits stick. So again, that's Thursday, the fourth of November 2021 is online. So you can be anywhere in the world. It's seven, basically 715 until 915. UK time. So we've had you know, in the past, we've had people from Canada and the states and all kinds of places, you know, mainland Europe kind of joining as well. So six weeks to ninja says the fourth of November 2021. And through to Thursday, the ninth of December 2021. So if you want to get involved in those Graham Allcott, calm, and then at the top of the site, you'll see the patron master classes. And we'll support all the details for that in the show notes as well. So if you're interested in that, have a look in the show notes, click the links through there, and go and get your tickets, I'm looking forward to seeing you. Yeah, and that's the other thing you you say in the book is just this, this idea of as they all combine, then it's all kind of helping each other to get deeper into just one one other thing on the human genome thing. So I know a little bit about this, because my son has a very rare genetic disorder, he's the only person in the world with a particular mosaic ism on chromosome six, so on and so forth. So it's kind of helpful for me to, to know that because we can use that information to compare that to similar cases and stuff like that. But presumably, there's like hundreds of applications and endless applications of the human genome that we don't know about, or things that are happening now that you know, sort of on the cutting edge. So where do you see that like, when it gets so cheap? And assuming what happens with that is like you say governments are not the only ones playing around with this stuff. Anyone with a startup can almost do it, you know, do that from their phone and carry on with it. So like, what are some of the things that might start to happen with that, as I understand that?
Azeem Azhar 29:26
I mean, I think that science fiction has given us some some ideas of where this might might all go, I mean, therapeutic, good and bad, right? Yeah, exactly. You know, therapeutics is an obvious one, personal therapeutics for initially they're very difficult and complicated. diseases and gene therapies are, you know, complicated, expensive, but increasingly effective. And in fact, there's been a there's been a genetically modified sort of CRISPR based therapy that has reversed particular type of blindness for example. And so so there's once you move down from therapies for for difficult and, you know life altering conditions and they get cheaper, you start to apply them to, you know, other types of, of issues that people might have. And you might start to apply them to as one input into people's diets, for example, but you need, you know, you need to look at other things for diet. But I think where it starts to become a little bit nerve wracking is when we look at the issues of genetic selection. So using low cost genome screens to look at very, very early six to 16 cell embryos, and figure out which ones are you know healthier, and deciding which ones to implant and there's, there's a number of companies that use this technique, it's, it looks for something called a snip and SNP in the, in the chromosomes. And it can, you can correlate that with the likelihood of things like extreme dwarfism, or, you know, aneuploidy or other types of Down syndrome things. But also some of these companies claim with the likelihood that you have someone who's tall, or he's got a really high IQ. And right now, that technology is mostly used at the tail end of IVF, when, through the IVF process, you end up with, you know, four or five viable embryos, you're only going to implant one. And you might run a screen like this, to take out the worst, any of the embryos that have really, really severe life threatening illnesses attached to them. So you've been planned to help you. But of course, parents will say well, is one of those two healthy ones got higher IQ potential. And, and that's where you get onto the slippery slope. And then of course, you get to kind of modification right that, that so where one Chinese scientist doctor, hey, you know, breached a bunch of protocols, and he applied this CRISPR gene editing technique to some twins, to knock out a particular gene and make them resilient to a particular disease. And you know, he, he was the first to do it, and others will others, we'll do that. And then I think the third area is slightly outside of the medical domain, but it's that, you know, if we've all had a genome sequence, and we know my risk of Parkinson's or dementia, or blindness or stroke, from the genetic factors, or how does that then change the way that say the NHS interacts with me or my life insurer, and interacts with me? And do I lose that collective benefit, and we've made the assumption in insurance, that actuaries who are underwriting the risk, only know so much, right and see in their mind know, lots, lots more, so there are these sort of three little Heebie jeebie areas like of selection modification, and then, you know, this idea of being completely transparent from our genetic propensities.
Graham Allcott 33:12
And I guess that leads us on quite nicely to actually just try to try to explain what the gap is, right? And so you talk about the exponential gap. So do you maybe want to just build on what we were just talking about there? And just and just talk a bit more about what the exponential gap really means?
Azeem Azhar 33:30
Yeah, I'd love to, you know, so obviously, these things are changing so quickly. And, and they're driven by the technology and by by entrepreneurs, and scientists who are able to take advantage of it. But the rest of us live in a world that is much, much more linear, that changes much more slowly. And we don't necessarily understand that there is an X, there are exponential processes, and we don't necessarily understand what what the impact of those processes are. And one question is, well, why don't we understand it and you know, my, I'm a bit lazy about this, I've explained it in over 20 pages or so. But that it's that we're really bad at maths that we don't see exponential processes. In the real world, our child goes from one to two to three to four with every year, they don't go from one year old to two year old to four years old to eight years old to 16 years old. We just don't we see linear processes, we experience linear processes and so there are probably evolutionary reasons why it's not in our makeup to naturally understand these very, very fast changing processes. So we don't we don't see how quickly things are adapt are shifting. I mean, I use this example can I use my my rain and my Wembley example with the Wembley Stadium
Graham Allcott 34:51
thing? Yeah. Cool.
Azeem Azhar 34:56
I mean, I just use this example around. You know, the idea of a Have a wet football match in England, which is not uncommon. And typically late rain is pretty linear just sort of falls at the same kind of constant amount, maybe increases a bit and then quietens down. Imagine you're in, you know, Wembley Stadium, you're right at the top, you're about 40 metres above the ground, and raindrop falls. And then a minute later, two raindrops fall. And then a minute after that fall, raindrops fall, and you realise you've got exponential rain on your hands? And the question is, it's going to take you 30 minutes to get out of there, into your car and drive away. So at what minute, should you leave your seats. So after four minutes, you've got eight raindrops. And after five minutes, you've got 16. It's really not very much, I mean, raindrops are tiny. And it turns out that you have to get moving by minute, I should give it away 17. Because you need 30 minutes to get to the car, because by the 47th minute, which is the moment you get to the car, rain will be dropping at 141 trillion drops per minute. And that will weigh 600 million litres of water will weigh a lot. 600 million kilogrammes. In particular, in practice, by the 15th minutes, our 5 billion tonnes of water will fall from the sky. And so if you're going to have exponential rain forecast, it's best to stay relevant and to help you watch TV. And the thing is that we can come up with these sorts of ideas, right, and this one about the right grains of rice on the chessboard that has been around for hundreds 1000s of years. But we're actually living at a time where these changes are happening very, very rapidly. And they're happening at the core technologies, then they're happening at the products and the services. And so during the course of writing my book, tick tock went from being nothing to being the biggest app in the world. And the challenge is that the institutions that we live our lives in so that common habits, the fact that you q when you go to the shops, if you're British, at least, the fact that we have the highway code, and we have the UN and laws and formal institutions and an informal customs. Those things accrete over time, they develop over time. And they change quite slowly. By Design. I mean, if they weren't, they were changing really quickly. They wouldn't be institutions, they would be fads, or crazes, or ephemera. But we live our lives regulated by those institutions. And so the exponential gap for me is the gap between this fast rising curve of the exponential age and the technologies and the services built around it. And the slow adaptation of the norms and practices and institutions that we take for granted in in living our lives.
Graham Allcott 38:02
And it sort of struck me as well, that part of that exponential gap is a sort of transfer of power, right from a lot more of that progress being seen through governments and organisations like the UN and policymakers and so on. And now you've got not only these enormous companies that have a lot of power, but also you've got startups that are also part of, you know, LinkedIn to the scientific community that are actually creating exponential growth themselves, almost like under the radar, and then it suddenly becomes the next Tick Tock or the or the next new thing. What do you think? This is the big question, I guess, is like, what do you think government should be doing about, you know, making sure Amazon pay their tax and making sure Facebook have better ethics? What should be the way that as a society, we interact with those those big companies in particular?
Azeem Azhar 38:50
Well, I think the important thing is, what I tried to do in a number of the chapters is to explain the actual cause, right to explain the condition. We're used to seeing the symptoms. And the symptom being that Facebook seems to have way too much media power, or Amazon doesn't pay its tax. The question then is to really go into understand, I think, what the, what the cause is, if you want cheap pot shots, you worry about the symptoms, and that's what the politicians often do. And understanding those causes is about understanding the new rules of the exponential age. So the question is, why are these companies so huge, and the, the argument that I make is that in the, in the pre exponential age, the industrial age, there were forces of gravity that held companies in in check. So if you are making cars, it got progressively more expensive to source the steel. You know, the steel you bought for the millionth car. was much more expensive than the steel you bought for the first car. And you got that effect of diminishing marginal returns, you also saw an organisational complexity and companies would just get too big. And many of us remember working for big companies, we couldn't do anything really. And so that made markets and markets more competitive because companies couldn't get that big. So there would be more of them, and you wouldn't get that much market share. And if you did get a lot of market share, you've probably have done something a bit a bit dodgy to get there. And certainly you would be smacked for for doing it by regulators in the exponential age, because of the nature of these of the companies. And I'll just pull on one idea. They don't have the same force of gravity that holds them back. So one of the key things that these firms have is what's known as a network effect. It means that unlike the car company, where every customer needing another car means more progressively more expensive steel, in a network age network company, the exponential age, every new customer adds value to the other customers another person, you can message on Instagram. And that work network effect means that the rich get richer, bigger companies get bigger. And so what we see is that exponential age farms are really dominant in their marketplace. But what is the second biggest photo sharing site after Instagram? is still flicker? I don't know, what is the second biggest? The second biggest? No, no, I mean, you know, nobody, like wanted to be on there, right? Because no one else is. So network effects is one of the dynamics that I talked about. And so the underlying thing to understand is that, in the industrial age companies had limits that the economists had studied for a long time. And that would limit their size in particular ways. And we built rules around how companies are controlled the company's back Competition Act a bunch of other things in the UK, that were based on that assumption. In the exponential age, they they operate very, very differently. And so because they operate differently, you need to establish new rules. You don't need seatbelt laws, in a world without cars, right in the 1750s. And when you get cars, you need to have seatbelt law. So I think you have to understand the the underlying processes and then you start to say, Well, really, what are the what are the issues? And you know, that's that's a kind of a deeper question in terms of what interventions are needed and why they need it.
Graham Allcott 42:50
So just kind of putting all that together, what are you optimistic, are you pessimistic around the future of work, and whether or this labour saving technology is going to be good for us or bad for us?
Azeem Azhar 43:03
I think the more people who buy and read my book, the more optimistic we can be. Because I think I come up with some ideas in there, I mean, I feel that it you know, the path to dystopian pessimistic outcome is really just a path of where we, we don't we choose not to tackle the issue or we tackle the issue in the in the wrong way. And what we what we have seen traditionally with technologies is that they do create a small number of very, very high value jobs. I mean, it was true for Ford, Henry Ford, where the, the engineers were very highly skilled and worked, you know, were well paid. But the off the factory operators were brought, you know, almost driven to lunacy with just screwing what the same not on the same bolt day in our in our hour after hour. And so we've seen that pattern play out before, I think that's quite helpful. I think the second thing that is worth noting is that this idea of the quality of job is also a relative thing, it's relative in your geography, your economy. You know, a gig job may look really informal and precarious. In the UK, it might look much more formal and much more reliable in a market like Nigeria, India. And so, so, the other thing, the other final thing is what you know how, in a kind of historical context, good or bad Will any of these these jobs be? So I think there will be a real risk that we will establish incredibly well paid. Elite, we already have that who work in The sort of complex and of building these products and services, and very large pool of people who have quite comparatively terrible jobs. So in Facebook, for example, where the average compensation is above $200,000 a year, unless you're a content moderator, and you're looking at all of the kind of hideous stuff on Facebook, where you get paid less than 30 grand, and so so you start to see it. And then the question is, well, how do you? How do you tackle it? And how do you tackle it without hurting the dynamism of, of your economy? And we've been so scared about hurting our create dynamic creatives, right? Since Margaret Thatcher came around that we haven't asked the simple things like, should we just raise taxes? Should we increase worker rights? Should we allow workers to act collectively so they can bargain and get better pay and conditions? And historically, that's been the only way that workers have improved their pain conditions? Should we? Should we ask companies to be transparent about how much people are paid up and down the organisation? In the same way we ask them to be transparent about gender disparity, we ask them to be transparent about aspects of their governance? And would that also help us close narrow, any of these sort of strains and, and, and concerns? So I think I think that there are specific things that you you can do to, to manage this where we've got to has been that this move towards platform work, and also zero hours contracts, which which existed in the UK before, has really just been a very avaricious slide down or sort of really, really excessive capitalism. And, and actually, we can come in, and there are some old things, and there are some new things that we need to do to tackle that. And I don't think that that cost comes at the cost to any dynamism in the economy. But it comes to, with the benefit of much improved life chances and quality of life for lots of people.
Graham Allcott 47:15
I'm just curious. So I'm going to ask is there like, Is there one pet policy like that, that you would just really love to see happening tomorrow is there like some is there one thing that you're really sort of passionately behind?
Azeem Azhar 47:28
Well, within, so within labour markets, unemployment, the the parliament there, they're actually two if I can bundle them together. So So the first is the the better treatment of people who are who are gig working, we overstate the benefits that people who are salaried, get, you know, the idea will you'll always get paid because you're on a salary, and then you get made redundant. And it's like, well, actually, as a gig worker, you had more certainty, you get constantly punished as a gig worker for that. And I think changing that approach would be really important. And then I think the second thing is establishing a, a welfare system that recognises that moments of very, very rapid change, employers are going to end up firing people, and workers are going to need to retrain. And so the Danes have a system called flexicurity, where you can, an employer can get rid of you, but you get paid 80% of your salary, provided you're kind of continuing to participate as a useful citizen by looking for work and by training. And, and what you then start to do is you will also then go in and start to eliminate the stigma of, you know, the job loss and also eliminate that awful language of scroungers and the idle, and so on that has kind of infused a lot of the way that we've talked about workers for the last 40 years. Where do you sit on universal basic income? The fence? You said there's gonna be no, there's gonna be no mean questions, and I really pretty jelly wobbled around UBI, in the book, because it's, I think that what you see in advanced or increasingly rich societies, and is that they tend to make more and more comprehensive provision, because they can write they clean the streets, they don't leave the horse manure on the streets, and so you'd expect that to continue to happen in any society with any sort of sense of social decorum. I don't have my any objection I have to UBI is not about whether it would make people lazy and and idle as it is. Last year. 61% of Americans didn't pay any federal income tax, right. So that's already more than half who aren't contributing to the federal purse. So So why I slightly dodged it is because I think it's so politically difficult and contentious for people who don't like it. And it's presented a little bit as a cure all, for people who who do. And I just think the world's a bit more complicated than that. And
Graham Allcott 50:21
what I wanted to finish with there is obviously, just bringing it back to you personally, it just feels like you do such a wide range of things. And I wondered if there was any particular thing that you do that you enjoy the most? And also, is that something that you do, where you feel, this is the thing that I do that has the biggest impact just in in your own work and your own experience of work?
Azeem Azhar 50:47
Of all the things that I do, they're all they're all connected to, to the main thing that I do that has the has the impact, I think we're going through a transition to the exponential age, I think it's going to need new ideas and new institutions and new businesses. And I, what I do in my work with my newsletter, and my podcast is I use those to learn and to share my learnings. And then I work with, with entrepreneurs by investing in them, to help them build those businesses as part of the the the transition. So it all hangs together in my head, even if it doesn't necessarily look, you know, maybe looks a bit disaggregate and diffuse from the outside. But they are all meant to sit together and be part of this change that we are we're we're going through we're privileged to be part of, but the real thing that I do that I love is I run. Can I really, huh? Yes, yeah.
Graham Allcott 51:48
training for half marathons. And marathons is the fact that
Azeem Azhar 51:51
I could I could run 150 metres in July 2020. And in August 21, I ran my first 16 and a half kilometres. I absolutely love it. And yeah, yeah, I mean, I would do that if I didn't have to do all this other stuff.
Graham Allcott 52:13
Yeah. So you've got kind of an exponential fitness thing going on, which feels like
Azeem Azhar 52:19
I can't keep it up, it was 100x everything in one year, that would mean I'd be running 1000 kilometres every every Sunday, which isn't going to happen
Graham Allcott 52:26
exactly. Well, it will look forward to hearing about it a couple of years, and how far you progress with it. So the book is exponential. I'm gonna flash it up on the screen here. And the thing is, it's got such a lovely silver typeface thing that is quite hard to get all the words on the screen without one of them. But if people want to find out more about what you do, so you have this amazing weekly newsletter with 200,000 people on it, and you've got a podcast and stuff. So just give us all the various places that you can go and find out more and continue some of these really fascinating conversations. No, no, thank
Azeem Azhar 53:02
you, Graham. Yeah, so the book is at your exponential at any of the bookstores as usual, the podcasts and newsletters exponential view, you can just pop that into your search engine, I'll be the first thing that comes up. Pardon me. And if you want to follow me on Twitter, it's ASEAN, which is a Zed E.
Graham Allcott 53:22
Fantastic, thank you so much for being on beyond busy.
Azeem Azhar 53:25
My pleasure. It was great. Thanks very much.
Graham Allcott 53:27
So thanks, again to Azeem for being on the show. And as I said at the beginning there, you know, before when I first said yes to having Azeem on the podcast, I have to admit, I was quite intimidated by by the topic and you know, whether I'd have enough to say and good questions to ask him and all that kind of thing. But the book is just so it's just so like, humble in the way that it sets it out. Like there's some big data stuff in there, you know, and sort of, you know, pages that look like an economics textbook, but actually, there's some really good, you know, very clear writing and narrative in there. So I implore you to go and buy exponential. And don't be put off by the subject matter, because it's really important. It's just a really important topic. So yeah, if you enjoyed the episode, do go and check out as he was book, and also exponential view, sign up to that mailing list as I have done so. I'll see you there with exponential view.
And thanks as ever, to our sponsors for the show, Think Productive. And if you want to support Think Productive, you can get a ticket to one of the events that we talked about in that little middle section there. And Think Productive also have a whole range of different workshops and learning solutions for companies. So go to think productive.com to find out more.
And thanks to Emilie and Pavel my trusty team on the podcast who make everything happen behind the scenes as ever, just really appreciating their support and help with making all this happen. So we're getting into the autumn and it really feels like stuff is turning right you know, the weather feels like it's it's about to turn. And it really feels like we're getting back down to some serious work in a bit of normality, keeping an eye, obviously on everything that's happening as well. And yeah, just hope you're, you're back in the groove and just enjoying the work that you're doing. If you want to sign up for my weekly email, it's called rev up for the week, just go to Graham allcott.com. And you'll see a little form on every page and you can also get a link to that in the show notes. And but basically, the idea of that email is just to send you one positive or productive idea for the week ahead. So it comes on a Sunday evening. And so as we get back into the saddle, if that feels like it will be helpful for you. Just to have a little nudge for me on a Sunday evening ready for the week ahead. Just head to Graham allcott.com and sign up there. We're gonna be back with we've got a really good episode in two weeks time Daisy, darling, is the expert on being a working parent, do you know why it's probably the topic I've been asked the most about, in terms of me writing a book and it's always been the topic that I have shied away from writing a book about, partly because I parent in a very different way. Some 5050 single dad, so I'm not with his mom, and he has some special needs. I just feel like my parenting experience is just not normal. Like it's not, you know, whose is but mine just does not feel like it's in any way, like a typical experience. And I kind of feel like I can't really write a book from that perspective. But Daisy has done it and you know what she's also done it in a way that is applicable to everyone, including single dads and you know, people with, you know, kids with special needs and all sorts of stuff. It's a really good book. It's called work parent she's on in two weeks time. So make sure you're subscribed. Make sure you're liking and commenting on wherever you get your podcast.
We'll be back in two weeks time so getbeyondbusy.com for all the show notes and everything else and we'll see in two weeks. Take care Bye for now.
✔ Links:
Exponential: https://www.exponential-book.com/
Follow Azeem on Twitter: https://twitter.com/azeem
Azeem’s Podcast: https://open.spotify.com/show/4euXUXWbt18zikpUvFl21q
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