Weekend Reading: Non-Experts, Non-Linear Innovation, and We Were Builders

October 24, 2020 • #

👨‍💻 The Rise of the Non-Expert Expert

Vicki Boykis on the impossibility of true breadth and depth of technical expertise:

What used to distinguish senior people from junior people was the depth of knowledge they had about any given programming language and operating system.

What distinguishes them now is breadth and, I think, the ability to discern patterns and carry them across multiple parts of a stack, multiple stacks, and multiple jobs working in multiple industries. We are all junior, now, in some part of the software stack. The real trick is knowing which part that is.

⚗️ Innovation is Not Linear

I’ve written lately about the nature of innovation, and this is a good addition from Works in Progress. The mixture of basic scientific research and the tinkering of inventors is not a mechanical, proportional relationship. Impactful innovative results from foundational discoveries could happen immediately, or could be separated by decades. And often we create new inventions without even understanding how they work:

The impact of science on invention is long-term and often impossible to foresee. There are some times, certainly, when scientific pursuits have obvious applications: when Robert Koch identified the bacteria responsible for tuberculosis, he must have known that this would someday help us prevent or cure the disease. But when Bohr peered into the structure of the atom, or when Rutherford and Curie investigated the nature of radiation, it is doubtful that they expected their work to lead to nuclear power or MRI scans.

Investments in science, then, if motivated by long-term progress, cannot be prioritized by immediate practical impact. It requires, in Bush’s words, “the free play of free intellects, working on subjects of their own choice, in the manner dictated by their curiosity for exploration of the unknown.”

🏗 We Were Builders Once, And Strong

Back in the summer, Tanner Greer wrote an excellent post on our current cultural stagnation and inability to get things done. “On Cultures That Build” (my thoughts) made the case that, rather than pulling ourselves together and getting to work to invent, create, and solve problems, the standard approach is the “appeal to management” (one of my favorite aphorisms of 2020). He follows it up here with a look at Battle Cry of Freedom, a civil war history.

With the election of Abraham Lincoln they could point to one who had risen from a log cabin to the White House. “I am not ashamed to confess that twenty five years ago I was a hired laborer, mauling rails, at work on a flat-boat—just what might happen to any poor man’s son!” Lincoln told an audience at New Haven in 1860. But in the free states a man knows that “he can better his condition . . . there is no such thing as a freeman being fatally fixed for life, in the condition of a hired laborer.”

Neumann on Schumpeter on Strategy

October 20, 2020 • #

There’s a myth in popular culture that associates “being an entrepreneur” with “making a lot of money.” But do they, if compared to a world where an entrepreneur did the same job in the employ of someone else?

In this post, Jerry Neumann references a chart from Scott Shane’s The Illusion of Entrepreneurship that tells a much more realistic story of what creating your own business means financially:

Comparison of entrepreneurs vs employees

The vast majority make the same, if not less than, their non-self-employed peers, at least until you’re into the 80th+ percentile where the incomes balloon, those massively successful entrepreneurs who create something much more valuable, well beyond their own level of input. Political economist Joseph Schumpeter described this as one of inputs and outputs. In both cases — where a person is a founder versus a contributor in another company — they’re an input to the system, contributing in the same capacity toward profit regardless of their status:

In a market economy, at equilibrium, Schumpeter says profit gets competed away. By profit he means “surplus” profit: the money a company makes if its inputs are priced correctly. Crucially this includes the cost of money adjusted for the risk the investor is taking. That is, you can’t increase risk and say “look, now there’s a profit.” That profit is the cost of the money used in the business.

Neumann points out an interesting insight around why entrepreneurs start their own businesses. It may be that the popular understanding of what drives a founder is financial, that their primary motivator is to make more money. But here’s a shocking statistic: that 81% of founders have no desire to grow their business:

Shane notes that the median revenue of an owner-managed firm is $90,000 and that 81% of founders have no desire to grow their business. This is because most founders are “just trying to make a living, not trying to be a high-growth business.” And they “start firms in industries where there are a lot of firms already in operation” and “report they have no competitive advantage.”

It turns out that independence is one of the largest drivers for people to work for themselves, not to get rich (though I’m sure most would agree that they’d like that, too, just maybe not enough to push that much harder than working as an employee). Quoting Shane again:

“The real reason most people start businesses…has nothing to do with wanting to make money, to become famous, to better their own communities, to seek adventure, or even to improve the world. Most people start businesses simply because they don’t like working for someone else.”

He goes on to tie this back into how it drives typical business strategy. Not all “startups” (in the loosest definition of the term — “independent company” rather than “SV company building software”) have the same underlying motivations driving their creation, so should not be compared in economic terms on the same dimensions.

If you polled government civil servants, regulators, or funding organizations, everyone would agree that new business formation is something to be encouraged and enabled. But if so much policy is developed with a definition of “startup” that you read in the news (your Ubers and WeWorks and Airbnbs and other hypergrowth compatriots, driven by market expansion and dominance rather than simply personal independence), then they’re only framing the infrastructure around a small (actually, by quantity, tiny) subset of companies. Refining the popular understanding of what “starting a business” actually looks like on the ground would go a long way to helping make it easier to do, and give your average person a better appreciation for what the motivators really are.

Everyone I know who runs a small business would be first in line to tell you: if you want a bigger paycheck, don’t start your own company. If you asked a random person on the street, though, they’ll generally associate “business owner” with “person that makes a lot of money.” I’ve never been one myself (yet), but I have a totally different perspective than this with so many direct relationships with business owners.

If most people had a better understanding of what motivates the founder, how much better could we do at supporting entrepreneurial activity?

Two Years of Everyday Writing

October 19, 2020 • #

Earlier this month I passed the 2-year mark of writing on this site every day. If on that first day, deciding to embark on this streak, you’d told me that in October 2020 I’d still be going, 2018 me would’ve laughed it off. Doing it even for a few months sounded impossible.

What helped make it reality was converting writing into a continuous background activity, an ever-present filter for thoughts, ideas, and readings to pass through. Every time I read an article or have an idea, I filter it through the writing lens — Would this make a good article? Do I have a unique angle on this idea?

James Clear writes about how your environment is a strong contributor to effective habit-forming. One of the techniques he describes resonates with me and fits my behavior patterns nicely: staging your environment by putting enablers “in the flow”:

You can apply a similar strategy by designing an environment where good habits “get in the flow” of your normal behaviors. For example, if you want to practice a musical instrument, you could place it in the middle of your living room. Similarly, you are more likely to go to the gym if it is literally on the way home from work than if the gym is only five minutes away, but in the opposite direction of your commute. Whenever possible, design your habits so they fit in the flow of your current patterns.

My writing filter above is a version of this. It’s a context that keeps me accreting ideas together as fodder for writing topics. This perpetual context is one version of an environment that happens to work well for me. I have reminders in Roam, various “ideas” tags, tools to dictate quick thoughts to a scratchpad. And the goal commitment itself eventually builds up enough gravitational force to do its own pulling.

If you can create patterns of behavior to support the building of a habit, it’s amazing what kind of change you can engender in your behavior.

After 747 consecutive days of publishing, it’s a good time to reflect on what I want to do with the site outside of regular posting.

Downtime Thinking

October 19, 2020 • #

Of the hundreds of posts I’ve written here over the past few years, I would guess that 80% of the topics spawned in my head while exercising. Running is my primary regular means for alone time to think in silence. I usually listen to audiobooks while I’m out, but constantly pause to dictate notes to myself into a scratchpad document. Reviewing this occasionally is like a stream of consciousness chain of observations and ideas that I can usually peg to an origin of what triggered the idea, then can take it and run with it when back home. There may even be some science behind this; perhaps a more active heart rate or increased blood flow increases brainpower. Wild speculation, but running certainly feels mentally invigorating sometimes.

When we sit at our desks, we have access to all of our resources — apps, tools, websites, Wikipedia — you’d think that an environment like that would be a boon to creative thinking. But that continuous pull of your attention into different directions plays hell with being able to contemplate freely, to dive into the second-order consequences of an idea.

During the work day we’re also all contending with dozens of meetings, calls, emails to read, emails to send, a never-ending stream of minor inputs that don’t afford the free space to think for extended periods. That dedicated time when we’re fully undedicated, no commitments to anything or anyone, is often when we have the range of motion to do our best thinking.

In a post from a few years ago, Morgan Housel referenced a great quote from psychologist Amos Tversky:

Amos Tversky, the late collaborator of Nobel-winning psychologist Daniel Kahneman, once said “the secret to doing good research is always to be a little underemployed. You waste years by not being able to waste hours.”

When I look at my calendar on many days, I wonder how or when any deep thinking is supposed to get done. Luckily I devote space for this for other physical exercise that does double duty as a mental stimulant. It’d be nice if we collectively had more respect for this phenomenon in spaces of knowledge work, but until we do, the best we can do is understand it and compensate with our own “downtime.”

Here’s Morgan again with a nice reminder:

There’s never going to be an Adamson Act for knowledge workers who need time to think. It’s up to you to figure it out. The first step is realizing that taking time in the middle of your day to do stuff that doesn’t look like work is the most important part of your work day.

Even though Steve Jobs famously said the computer was the “bicycle for the mind,” I think we might need to remove that metaphor — maybe the bicycle is the best bicycle for the mind (or your legs or weights or your favorite chair in a silent room).

Weekend Reading: American Growth, JTBD, and Dissolving the Fermi Paradox

October 17, 2020 • #

📉 Summary of The Rise and Fall of American Growth

Concise summary of Robert Gordon’s book on Roots of Progress.

👨🏻‍🏫 Guide to Jobs to be Done Interviews

A solid comprehensive, step-by-step overview of how to conduct JTBD interviews.

🛸 Dissolving The Fermi Paradox

A pointer somewhere on Twitter led to this post from the Slate Star Codex archives, discussing a paper that supposedly debunks the Fermi paradox:

Imagine we knew God flipped a coin. If it came up heads, He made 10 billion alien civilization. If it came up tails, He made none besides Earth. Using our one parameter Drake Equation, we determine that on average there should be 5 billion alien civilizations. Since we see zero, that’s quite the paradox, isn’t it?

No. In this case the mean is meaningless. It’s not at all surprising that we see zero alien civilizations, it just means the coin must have landed tails.

The 1980s Dream of a Free and Borderless Virtual World

October 15, 2020 • #

Reason Magazine has put together a 4-part documentary series on the cypherpunk movement, the early-90s collective of hobbyist computer enthusiasts that believed in an open and free internet. Their philosophies influenced cryptography, bitcoin, and BitTorrent.

This is part 1, a well-produced piece on an important phase of internet history.

What if Government Paid Better?

October 14, 2020 • #

In his book Political Order and Political Decay, Francis Fukuyama has a section on corruption in political systems and how it impacts economic development:

There are many reasons why corruption impedes economic development. In the first place, it distorts economic incentives by channeling resources not into their most productive uses but rather into the pockets of officials with the political power to extract bribes. Second, corruption acts as a highly regressive tax: while petty corruption on the part of minor, poorly paid officials exists in many countries, the vast bulk of misappropriated funds goes to elites who can use their positions of power to extract wealth from the population.

Today the most famously corrupt regimes lead the least liberal, least free societies. In these unstable environments, government jobs are among the most attractive to ambitious people. In part it’s because those jobs are more reliable than weak, inconsistent private sector jobs (and sometimes easier to get and retain), but the ease with which rents can be extracted in corrupted systems attracts people ambitious to build personal wealth.

You see the inverse of this phenomenon in states with strong free market systems. A certain class of ambitious person is still attracted to government, but more often for reasons of celebrity or power than financial reasons. The potential for personally-enriching rent extraction is much lower. Brain drain happens in the public sector because many of the most ambitious for wealth and status see faster, more lucrative paths in the private market. So paradoxically, the lack of this personally-enriching career path could be impeding potential economic development, just as in poisoned systems, but for different reasons.

It’s unfortunate that we squander our hard-won strong, corruption-resistant1 government system’s performance because we can’t find the funding to better pay our public servants. Our federal (and state) agencies don’t realize how efficient this allocation of capital would be, compared to the many channels through which we hemorrhage money year after year. What would happen if we paid civil servants better? How many of the ambitious, entrepreneurial class would stick around and increase the state’s capacity if they didn’t become disillusioned with personal stagnation?

  1. Of course we’re far from immune here. But when juxtaposed with the political systems of Liberia or the DRC, we’re doing pretty well. 

Subscribe here to receive my newsletter, Res Extensa, a digest of my latest posts, links, and updates. Currently bi-weekly.