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A View From the Edge: What's Next in Startups?

The Huffington Post The Huffington Post 9/11/2015 Mike Edelhart

2015-11-05-1446751145-1990777-830929.jpg © Provided by The Huffington Post 2015-11-05-1446751145-1990777-830929.jpg Image courtesy of NASA/Johnson Space Center Media Archive
As an early stage investor, I inevitably wind up in conversations about the future. And given that my team sees hundreds of startups each month, we're in the perfect position to spot trends - and even make a few predictions. So what's around the corner in startups? Here's my forecast from the technological edge:
Heed the Erosive Impact of Technological Change. In tech revolutions, transformation comes slowly. Transformation doesn't occur along a line. It is a curve and in the early days the slope of the curve is shallow, then, all at once it soars upward. Tech change is Darwinian. It is apocalyptic. It is like waves eroding beneath a beach. Everything is fine, everything is as it was and then: Wham! The dinosaurs are gone. Slam! The beach collapses. Today, we are in the shallow slope part of the social/mobile transformational curve. The change that is coming will utterly dwarf what we have experienced to date. Fundamentals everywhere, in every market, in every country and in every culture are under stress and will transform.
Visual Vocabulary Taking Hold. Pinterest ushered in an era where images are increasingly at the heart of communication. Images hit humans at deep emotional levels text cannot reach. Images are fundamentally borderless. Images work on screens of any size, where text cannot. So, beyond the pinboards of Pinterest, we are now noticing emoticons and emojis coming to the fore on mobile. We are seeing startups focused on emoji storytelling. Others are providing full mobile keyboards of brand symbols. We think this may be the presenting edge for a new form of universal communication.
Borders are Vanishing. Welcome to Chimerica! Along with borderless visual mobile language, we are noticing other effacements of traditional cultural boundaries. Already today, visual and mobile communication is largely borderless; Instagram can be comprehended anywhere. And, we are seeing the emergence of mobile, digital currencies, whose "country" is a digital community, not a traditional nation. Additionally, in the rising mobile millennials we have an emerging adult generation that is cross-cultural in essence. We are also seeing startups flow in different ways: Chinese teams based in the U.S. for tech advantage reasons; U.S. teams serving Chinese audiences for scale reasons. Teams spread across multiple countries and continents operating as single units in ways unthinkable before today's social/mobile revolution.
Behavior Is a Currency. Not only are borderless currencies, à la Bitcoin appearing. More importantly, we are seeing the new recognition that digital behavior is a currency. In truth, all currencies are a symbolic summation of the actions of many people, companies or governments. Now, online, that concept can be taken down to new atomic levels. All behaviors can be captured, weighed and scored in today's hyper-connected world. Influence, as a result, can be seen, measured and acquired; influence is now a real-price marketplace. This isn't just for celebrities: The actions of each of us can be measured in their broader impact. Purpose has a bottom line value, which will only grow in the future. If our actions directly create currency and value, beyond borders and outside traditional government, what are the long term social impacts? Impossible to know, but surely profound.
Predictive Analytics Emerging. The first generation of social analytics represented a useful look backward: Here is what just happened. The new generation, by contrast, predicts upcoming emotional states and actions. We can now impute what a person or group will do next and why. This, obviously, massively impacts the precision of marketing and messaging. It puts the dagger deep into the heart of traditional advertising. Soon, we will see a digital "people market" where future needs and actions of people can be valued and purchased like stock futures. In this shift, the money flow will flip around. Media will pay consumers for access to their behaviors, rather than consumers paying media for access to content. Marketing will become market. The difference between commerce and content will vanish.
Devices Will Dominate the Digital Conversation. It is easy to say that 50 billion devices will be active on the world network by 2020, but the impact of this is almost beyond calculation. That is 8 times more devices than people on the Net. All the change we have seen to date comes through people having interactions with people at a distance, in ways previously only possible up close and personal - these conversations have been mediated by software and the Net. But soon, we will see all those billions of devices having conversations with one another on behalf of people.
We will stand at the end, rather than the center, of this new generation of conversation. An example: "Mike, this is your fridge. I am letting you know that Frigidaire central and I have been in touch several times this morning. My compressor has a problem and we have decided it is serious. We have reached out to Joe's Appliance, the highest rated certified vendor within 10 miles of your house. Since your calendar says you will be home all day, a technician will be coming to your house today. Click here to cancel this service visit. Note that I could fail by 2:00 pm tomorrow if I do not get service in time."
I've been involved with the tech revolution for more than three decades, long enough to know that some, maybe even most, of these predictions will turn out to be incorrect. However, what cannot be escaped is that the decades ahead will usher in the most profound alterations in human behavior and the fundamentals of social interaction since the Industrial Revolution.

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