Innovate for Humanity (Not Shareholder Value)
This is the second of a six-part series discussing the mental qualities required from a new generation of innovators
At the peak of one of the greatest economic downturns in US history, I did the unthinkable. I quit my job in Los Angeles and walked out of a career I had always envisioned for myself in exchange for work that fulfilled me. That meant moving to Peru where I planned on launching a business that increased the participation of marginalized communities in the country’s textile supply chain. I was 24, and with a big appetite for risk and adventure.
A year on, I found myself running a fully bootstrapped venture that sourced fiber from alpaca herders in the Andes Mountains and manufactured with small women-owned businesses. Together, we created beautiful and responsible apparel for the US and European markets. We served our niche product to specialty boutiques for two years when we began noticing a peculiar pattern. Each sales season kicked off with the news of at least a third of our customers going out of business. These were headwinds from the ongoing economic collapse, and the numbers showed. Over time, I had to make the decision of either selling out to a strategic partner or raise venture funding to continue the dream.
The investors we decided to court were eager to participate as long as we could show higher sales and capacity to scale. And that’s exactly what we did. We began taking steps to increase production threefold in order to reduce prices and began entry into a new market. This in the middle of a global financial crisis. Fast forward a year and the business’s self imposed need for scale led it to expand operations faster than it should have, despite signals from the market. It was the fourth year after we launched when I decided to fold our operations while continuing to link our community partners with customers for their work.
This entrepreneurial journey laid bare what four years of studying economics never could: our addiction to growth. This was playing out in the overall economy. Subprime financial products were created and sold to fuel the hunger for economic expansion. The subsequent bubble in the real estate lending market created this historic meltdown.
Deliver growth at all costs continues to be the mantra of our modern economy; and this has shaped how our innovators think.
The current capitalist system forces us to create with only one metric for success: shareholder value. This single minded goal has created products that have elevated our quality of life, in varying degrees, for most humans. It kicked off the industrial and eventual technological revolution — the greatest turning points for humanity. This period of tremendous progress has come at a cost we are now beginning to confront: extreme economic inequality, and environmental devastation.
Alongside these challenges, we are entering a fourth industrial revolution. But this one will be different from the ones of the past. It will not just change how we do things, but it will transform who we are. Technology will begin to merge with our physical spaces and biology. This will create a world powered by intelligent automation, and the role of humans will need a revamp. Most of us participate in the economy by providing time. The ones that contribute capital retain the value created by this system. In this new economy, technology will displace 75 million jobs by 2022. Our understanding of the nature of work and humanity’s role is about to undergo a paradigm shift, alongside an unprecedented escalation of economic disparity.
Today’s innovators will have to shed concepts relevant for an older economic system. Fueling consumerism and aggressive market expansion will be a practice of the past. To be relevant for this new order, we will create with the sole aim of serving human needs, while maintaining our planet’s equilibrium.
The emergence of artificial intelligence, blockchain, 3d printing, clean energy and other technologies have given us the tools to solve humanity’s challenges. There has never been a better time to collectively channel our intent and resources towards humanitarian and environmental causes, and measure our success by the wellbeing we create.
Our future rests on how we make the mental shift required to create a new economy. One that is based on cooperation, and not competition. Our addiction to economic growth has powered humanity’s progress, while concentrating wealth amongst a few and creating environmental havoc.
It is up to our innovators to look at the possibilities before them — beyond growth and shareholder value. We can create a new type of human society; one that is built on an economy and technological scaffolding that addresses all of our needs.