Smart cities, drones, 3D printing, Internet of Things, Artificial Intelligence, driverless cars, and other innovations that used to be sci-fi just a few years ago.
STEFANO L TRESCA
Future Cities: Overview
Published by Seahorse Press
Copyright © Stefano L Tresca, 2015
All rights reserved. No part of this book may be reproduced in any form without permission in writing from the author. Reviewers may quote brief passage in reviews.
While all attempts have been made to verify the information provided in this publication, neither the author nor the publisher assumes any responsibility for errors, omissions, or contrary interpretations of the subject matter herein.
The views expressed are those of the author alone, and should not be taken as expert instruction or commands. The reader is responsible for his other own actions.
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Table of Contents
About the Author
Would You Like to Share Your Story?
Get the Entire Book
The Secret Life of an Uber Driver
Minerva Tantoco (New York City CTO)
Sex and Robots: Do Humans Dream of Electric Mates?
One Drone in Every Home
Hon. Jerry MacArthur Hultin
Where Can I Buy My Knight Rider? Insights on Driverless Cars
Eric van der Kleij (Level39 / Cognicity)
Future Cities Accelerators and Institutions
One More Thing
Your Neighbourhood Will Never Be the Same
[Which road do I take? She asked.
Where do you want to go? Responded the Cheshire Cat.
I don’t know. Alice answered.
Then, said the Cat, it doesn’t matter.]
[– LEWIS CARROLL
(Alice in Wonderland)]
By 2030 nearly 70% of the world’s population will be residents of a city. That means three billion more urban residents during our lifetime.
Our generation is destined to witness an incredible number of new buildings and cities built to host our new neighbours. Once these cities are built, they won’t be built again. And they won’t be easily changed either.
For good or ill, we’ll be forced to live in our creations for a very long time. Do it wrong, and we will condemn ourselves to a miserable existence: endless hours of commuting, loneliness, pollution, disease, crime, stagnation. Do it right, and we will provide great quality of life to ourselves and to our new neighbours.
The Best Way to Predict the Future
Driverless cars, 3D printers, artificial intelligence and digital medicine are changing the status quo. These changes are already happening without the help of governments, sometimes despite the government. The rise of the sharing economy is speeding up this process.
Five years ago I was used to meet one or two companies per year developing smart city technology. Now I get one pitch every other week. What’s going to happen in the next five years?
Wrong Answer, Right Question
As in the tale of Alice in Wonderland, to get the right answers, you first have to find the right questions. I don’t have all the answers—nobody does—but I’ve collected many interesting tools along the road.
These tools may help you and me to understand current and future trends in tech and culture. It’s a small competitive advantage, but in the coming days it may be essential.
Enjoy the insights and the interviews. If you don’t agree, feel free to contact me. I welcome any challenge. This isn’t a one-way conversation, after all. This is a global game.
STEFANO L. TRESCA
London, United Kingdom
ABOUT THE AUTHOR
Stefano L. Tresca
Stefano was employee No. 8 at Wind, a telecom startup company sold for $12.1 billion. Bestselling author and passionate about travelling, he worked in over 20 countries, until he quit the corporate life in 2011.
Today Stefano enjoys mentoring startup companies, and occasionally consults for corporations on innovation and investments.
Many years ago, he felt in love with the city of London, and that’s where he lives now, when he’s not travelling. Feel free to contact him on Twitter or trough his blog.
Connect with Stefano
Blog and Free Resources: http://startupagora.com
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Ask Any Question About Innovation and Startups
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‘Future Cities Overview’ is a stand alone book of a larger collection titled ‘Future Cities’. If you have paid anything for this Overview, and you decide to purchase the entire collection, drop me a message and you’ll be refunded (plus, you can ask me a question about any subject in the book).
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Would You Like to Share Your Story?
Either write something worth reading or do something worth writing about.
[_– BENJAMIN FRANKLIN _]
If you are a startup, an influencer, or an investor, I would like to share your story with my readers. The best ways to contact me and organize an interview are Twitter (@startupagora) and my website (http://startupagora.com/contact)
Areas of Interest
(In no particular order)
If you want to go quickly, go alone. If you want to go far, go together
– AFRICAN PROVERB
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— Stefano L. Tresca
The Secret Life of an Uber Driver
A man’s mind, once stretched by a new idea, never regains its original dimension.
—OLIVER WENDELL HOLMES
When I step into the car, I’m greeted by a string of pumpkin-shaped lights circling the inside roof. The driver—Jeff—has a shaved head, and tattoos visible in the orange glow. Not exactly a ride everyone would accept. Well, not before Uber anyway. Jeff is a five star driver, and his licence is stored somewhere in a server. The company knows who he is and where he lives, and his car is tracked every second of every ride.
When the media talks about Uber, it’s all about their status as a “unicorn”—a company worth more than $1 billion—the easy app and the cheap rides. They tend to forget that the sharing economy is more than price and product. You can take a ride from a tattooed dude in the middle of the night with more confidence than any time in history. (His Halloween décor is just a bonus.)
As with everything, there is—of course—a dark side. Privacy, tracking, and surveillance are giving senators a headache. Even so, the market will never go back to the old ways.
The reason is not Uber. In fact, this is not a post in favour of Uber. It’s not against Uber. It’s not about Uber at all. This is a post about a person—Jeff—and his receipt to live in our digital age. Jeff’s world is our world, he’s just adapting in a different way.
Taxi drivers have always been a great source of knowledge and fascinating stories to me. I have been travelling long before the advent of Uber—50 plus countries and counting—and cabs are second only to street food vendors to understand the local environment.
If it’s interesting to talk to taxi drivers everywhere, there’s no better place to chat with an Uber driver than in Silicon Valley. Here you can find countless programmers and high-paid salaries driving a cab for a few dollars per hour. Quoting an old movie—Every time a startup fails a driver gets his wings. They don’t want to get a “normal” job. They want to live free until the next Big Thing.
Jeff—in a way—is no exception. He’s a photographer, and can make $300 in one session. But getting customers can be irregular. So Jeff drives for Uber with his entire photography kit in the back trunk, waiting for a call. “Uber is great to pay the bills”—he admits.
Today he’d been on the road for less than three hours. While we’re chatting, he gets a message on his second iPhone (the first is exclusively for Uber). “Looks like you’re my last ride for the day”—Jeff says. A customer just booked a photo shoot in one hour.
In 10 minutes, we’ll reach my destination in Palo Alto. With one tap of his iPhone, Jeff will switch his career from driver to photographer. He’ll switch back to driver in the evening—if he doesn’t have a date with his girlfriend—or tomorrow morning. One tap is all it takes.
Welcome to Life in the Time of Uber.
NEW YORK CITY CTO
Access to the internet is the electricity and water supply of the Digital Age.
Programmer, patent holder, and mum are three words that don’t often come together in the same description. Minerva Tantoco is the exception. Raised in Queens, then attending the Bronx High School of Science, described as ‘badass’ (Forbes), former CTO of UBS in Hong Kong, and first CTO ever of New York City.
In my job, I meet many successful men and women around the planet, and they rarely impress me anymore. Again Minerva is the exception. She got me talking about William Gibson as her preferred sci-fi author. I mean, how many interviews with government officers end up talking about Gibson and his book Neuromancer? In my career? Zero. Besides, he’s my preferred sci-fi writer too.
Much has been written about Minerva as a ‘woman in tech’ or a ‘Queen Geek’. She said in another interview “For years, I dreamed of being a mom and becoming a CTO, but I certainly didn’t expect both to happen at the same time.” But I feel that focusing on gender in this article is rather reductive. This is the interview with a very interesting human being in a very interesting city. I am sure you will enjoy reading it as much as I did writing it!
So Minerva, you have been appointed CTO (Chief Technology Officer) of New York City, a role that is usually reserved for companies. It clearly shows they have an interest in tech and in smart cities. Would you talk about what’s going on in your city and in general in the US from this point of view?
Well, here in the U.S., the dialogue around smart cities was not as strong as I find it is in Europe, and in particular in Barcelona and in the UK. I think New York City has a very unique opportunity in its position as a global city to add to the dialogue around smart cities.
In New York we’re leading the charge in the concept of “Smart city as an equitable city.” It’s really about technology at the service of the citizen to build an equitable city.
One of my favorite science fiction writers is William Gibson, I guess you know him?
Absolutely! I will add the link to the trilogy Neuromancer, Count Zero, and Mona Lisa Overdrive for the readers at the end of the interview. We definitely have similar tastes.
I love his quote, “The future is here. It’s just not evenly distributed.” More and more, we see that this distribution of technology access is divided, not just across cities, but across gender, income, and racial lines. This tech divide is both a cause and a symptom of economic equality. So in New York City, we recognize that you cannot have a smart city without it being an equitable city, as well.
That is our organizing principle. And I am finding in my conversations with other cities like Medellín (Colombia), Barcelona, (Spain), and elsewhere in Asia, that this theme is coming on strong.
Since you are familiar with the space you know that a lot of the smart city dialogue to date has been about very important things like energy efficiency, growth, and sustainability. Transportation is a huge component too. They are all very much a part of New York City’s smart city strategy.
Our addition to the global dialogue on the subject of smart cities wants to be around equity. We look at the people-centric view of technology. It’s almost the difference between designing a city from the air and designing a city from the ground.
Could you tell us a bit more about the specific activity that is going on in New York?
For New York, our tech strategy is based on three pillars: talent, access, and innovation. And the innovation part is where our smart cities strategy sits. Jeff here (A/N Jeff Merritt also from the Major Office of NYC joined our meeting) is our Director of Innovation and is responsible for preparing New York for the Internet of Everything.
And so our focus is people-driven tech, using technology in creative ways to close the tech divide. I can tell you more specifically about a few things we’re doing so you’ll have a better idea of what we mean by that, if that helps, Stefano.
I would love that. Both me and the readers are always interested in looking at a few practical examples. Also, the majority who usually follow my interviews aren’t based in New York but in Europe and Asia with a growing number in Africa and South America; so practical updates that may look obvious to a New Yorker, are very interesting to us.
I’ll cover the top three. I’ll start from .NYC, the internet domain of the city of New York. NYC is the fastest growing city-owned top-level domain. And the idea behind that is, as top-level domain, we can provide New Yorkers with availability to domain names that they might not have access to in the .COM, because most of those are long gone.
You have to be a New Yorker to have a .NYC domain name, or you have to run a New York business. We verify the address, of course, because it is a branding tool as well. It was an experiment we started last year. We launched it in October, and there has been tremendous response to it.
The second is the website Digital.NYC, which is the one-stop online shop for all things tech in New York City.
Again, the idea is to democratize access to the tech scene. So when you arrive in New York City or are thinking about setting up shop here, you need access to all kinds of information.
Through a public-private partnership, we created this one-stop online site that is a mash up of all of the different tech scenes in New York. It lists jobs. It has a database of every startup and their locations. It has articles and blogs. It lists like 800 events and 5,000 different startups, where can you take a class, so there are educational opportunities included. It’s all listed there. And it’s all for free.
[_Giving access is truly going to become one of the main goals of governments all over the world. I am lucky enough to have a privileged view of the sector thanks to my job and these interviews, and it’s fascinating to see the similar reaction in places far away from each other. _]
For instance, in my last interview in China, Guo Bai pointed out exactly the same point that you just made. In her case, the focus was more on all the grants and scholarships and online courses that the government is launching. They may not work properly if nobody knows they exist. So part of the effort now in China is to increase the access to this information, especially among lower income families.
Precisely. And that is the power of the internet. As long as you have access to the internet, you can have that. And that is another area that we’re working on. I’m sure China is as well.
Now we see other cities replicating the idea of Digital.NYC and launching similar websites for their cities. And we are very flattered. They say imitation is the greatest flattery, right?
True. It could be frustrating in business, but in government, the more entities learn and copy the good practices of others, the better.
We’re very pleased that all these other cities are following us. Of course, to benefit from Digital.NYC at the higher level, you need broadband access. So part of our citywide tech strategy is to provide city-wide internet access. This is the third example, and probably the best-known—and one of my favorites. We are turning all of the payphones on the city’s streets into free high-speed Wi-Fi hotspots.
[_This sounds like one of my favorites, too. Would you like to go a bit more into details on this third example? _]
Sure. In our view the payphone of the future isn’t a payphone at all. You don’t pay for it and it’s not a phone. Really it’s the un-payphone.
The pay telephones here are paid for through a very innovative franchise granted through the city of New York. In exchange, whichever company has that franchise may sell advertising that wraps around the payphones.
When we were reinventing the payphone, we put out a proposal to companies to say, “Give us your best idea for turning these payphones into Wi-Fi hotspots.”
The winner was chosen last December, and we hope to see the first of these payphones appearing in New York City by the end of the year. These are going to be beautiful and sleek; basically kiosks that will have Wi-Fi available up to 170 feet around them.
And the speeds, depending on where the payphones are, will be at least 100 Megabits speed over Wi-Fi, and some of them will have the new radios for 1 Gigabit speed Wi-Fi. When it’s completed over the next few years, it will be the largest free municipal Wi-Fi in the world.
This also sounds like the base for a grid for the Internet of Everything.
Yes, exactly. The free Wi-Fi is just the tip of the iceberg, I’m sure. Because once these things are in place, the possibilities are endless. In the wearable conversation, there is much talk about the connected self. When everyone is connected, a smart city can provide benefits to all the citizens, and make the city a better place to live.
And then finally, the connected citizen can guide and influence public policies, government services, and also have a voice in the direction of the city. And we want that for everyone, truly everyone, not just the people with the money for an Apple Watch, right?
It really has this huge potential to truly democratize society. So that’s the tip of the iceberg and sort of the ultimate vision of connected self, connected city, and connected citizens.
In short, you make the effort to provide the access to everybody, therefore you inject human talent in the society that would have not have access because their low income. Then you leave the people and the companies free to develop their own solutions.
Exactly. And I would say that certainly the federal government and the President of the United States have a very similar view, which is that internet access is really a core infrastructure, similar to electricity and fresh water, right?
Access to the internet is the electricity and water supply of the Digital Age. In the past, private companies might not have brought electricity to all of the farmlands out in the middle of nowhere, right?
And in those cases, the government came in paid for electricity access to be made available in those rural areas. And there is now a trend I see with people thinking of internet access in exactly the same way, where the private companies, for purely commercial reasons, have not blanketed the city in broadband access.
And so what is government’s role in that? I’m sure they were thinking the same question about water and electricity 100 years ago or 150 years ago.
Are you seeing that in Europe as well?
I probably see this even more in Europe. The European Union is made up of many countries and historically they have developed their own specific culture. With such a diversity, at least some Member States will debate strongly about this subject.
Some companies would probably prefer to avoid any involvement from the State in providing free internet access. It’s probably a situation similar to what happened in Europe over 100 years ago with electricity. At the beginning, in some countries, access to electricity was not considered a right for everyone, but reserved for the higher social classes.
It’s interesting. I used to live in Hong Kong. The minute you went over to the border into China, the internet access would just drop down slower. And I know China’s grappling with this as well. I think they view it as essential to their economic future to improve it. So Hong Kong enjoys super-fast and inexpensive internet access.
Indeed in Hong Kong everything is concentrated in the city, and they have always been very innovative. I remember in the ’90s they already had a prepaid card—the Octopus—with touch payments. When in Hong Kong, I was able to purchase not only the transport ticket, but pay in small shops. We have a similar card, the Oyster, in London, twenty years later.
And it’s not just Hong Kong anymore.
Indeed. We are used to thinking that Asia and India copy Europe and the US, but many services now are coming to us from what they call “Developing Countries”. M-Pesa comes from Africa and so do the prepaid meters. China is not a follower anymore and India is famous for their tech hubs.
I was thinking that exact thought when I was traveling through Asia. Innovation, in some ways, as you said, will come from countries that have to improve the life of many low income people.
Much of it will come from Asia because they’ve had to figure out how to do mobile payments with a non-smart phone, for example, right? That’s why I also feel that we can have innovation come from our lower income areas here in the US as well.
Innovation doesn’t come from only wealthy places; in fact, it often comes from poorer places, as you said. So in New York City we can provide access and education to many talented individuals who will, in turn, create innovation. I think a big part of a smart city has to include a strategy to educate all people.
Asia is investing a great deal in universities and degrees and training people for the next generation of jobs, and that’s an essential component. Education has to be a big piece of a smart city plan.
So a fourth example that I can add to the point above, is that New York City has the first tech talent pipeline where we’re directly training adults for jobs.
We made a unique public-private partnership. We find what jobs need to be filled, and then we connect them with the educational institutions and schools that do the training.
We literally build the pipeline of people to go into those jobs. And this is something that New York is leading the way in, also.
In many cases, of course it’s educating our young in the public school system. But also we need to train people who don’t have a job right now so they can be more fully employed.
What’s the secret to do that balancing public encouragement and private activity?
A great example is New York City’s Tech Talent Pipeline, which is actually funded by several grants. So we actually act as the coordinator and convener and matchmaker. But we have the partnership directly with the tech companies in New York City, whether it’s a Facebook or a Google or Etsy. And then we also have those partnerships with the schools that teach web development, iOS, etc.
Really we function as the place where the matchmaking takes place. We find the students. We can, in some cases, use the grant money that we received to pay for the course. Because if your class is too expensive and you don’t have a job, how could you afford it?
What kind of budget is already assigned on this project, if you can say?
We’re starting this off as a relatively small $10 million initiative and we’re seeing what works. So far, it’s been very successful. And hopefully, it will expand not only here in New York, but to other cities and countries.
Can we say that part of your mission is to be copied?
Yes, being copied is a marker of success. It shows we got something right with that.
By William Gibson
3. Count Zero
By William Gibson
4. Mona Lisa Overdrive
By William Gibson
Sex and Robots: Do Humans Dream of Electric Mates?
At present machinery competes against man. Under proper conditions machinery will serve man.
One person in ten would have sex with a robot, according to a pool by YouGov. If you are amazed by this number, you would be shocked by the real data.
Let’s consider similar surveys. About 15% of the population admit to watching porn on the Web, but the internet providers reveals a more realistic 70%. About 9% of the population admit that they would have sex with a robot. Do the math and you can forecast the real market for the Sexbots, as they call the sexual robots.
In just five years, this may become a very disturbing phenomenon, or a great business. On second thought, it will probably be both.
Would you like more examples? An Illinois startup in this “market” raised 622% of their target funds on Indiegogo, the popular crowdfunding platform. I’m not going to describe their product in detail, because I want to save this book from censorship. The name of their campaign—AutoBlow2—is probably enough to understand what the product is about.
In a 67 pages white paper on “Robots and the future of jobs”, released by the prestigious Pew Research Center, the experts split into two factions for and against robots in the work force. While they were not able to decide on the impact of robots on jobs, almost all of them agree on one point: by 2025 “robotic sex partners will be commonplace.”
The Future Is Already Here; It’s Just Not Evenly Distributed
William Gibson used to say, “The future is already here; it’s just not evenly distributed.” Let’s have a look to what’s already here in this industry.
Japan is definitely the market leader. We are not talking about a couple of obscure research centers. Well known Japanese mega corporations like Toshiba are investing billions of yen to develop the perfect robotic sexual partner. Not long ago, at the Consumer Electronics Show in Las Vegas, they have released an Automata, an android with human resemblance. “Her” name is Chihira Aico.
To be fair to Toshiba, Aico isn’t designed to be a sexual toy, but a perfect housekeeper and employee. On the other hand, this may be one of the best lines of defence in the modern history of PR. “This is not about sex; this is just a housemaid and secretary at your complete disposal.” I can already see a very long queue of male consumers waiting for Aico to go mass market.
At the moment, Aico smiles to the crowd and can perform minor interactions. But it doesn’t take much thought to guess what other features may be available in future releases.
Kokoro, a division of Sanrio which specializes in robotics, has an entire line of robots that looks like human beings, the Actroid-DER Series. This is not a temporary vogue destined to disappear. In 2006, it was already possible to rent a DER for 5 days for 400,000 yen ($3,500 at the time). Each year, the models come to be slightly more humanlike.
Although these androids are built to provide many different services, the fact that they all are designed as females may look suspicious. There is a female android to train dentists (the Simroid Series), and a female android to work as a receptionist (the Asuna Series).
Even China developed a competitor a few years back, of course female—Dion—designed to be the perfect companion for you on Karaoke nights.
The Web reveals such an appetite for sexual content that it’s easy to imagine a similar growth for sexual robots.
This isn’t the only possible future though. A few months ago I was brainstorming with a startup about possible use of their technology, and robots was one of our bullet points.
“Customers will not be interested in having sex with robots,” said one of the engineers “it will be cheaper to have sex in virtual reality.”
Well, this is . . . reassuring, right?
In the meantime, I’ve registered Botsder.com, ‘Tinder for robots’. I am very curious to watch the reaction of the venture capitals.
INVESTORS & INFLUENCERS
RESEARCHER AT HEC PARIS AND ENTREPRENEUR IN CHINA
The more you know, the more you dare.
[—HEC UNIVERSITY PARIS
Guo Bai is the author of “China’s Development: Capitalism and Empire”, an intriguing book on China’s past, present and future. She’s a researcher in Paris and an entrepreneur in China, working to develop the Chinese Kickstarter for equity. I’m not going to write a long introduction because you can find all the information in the interview.
With 70% of the world’s megacities being located in Asia by 2025, and with the majority being in China, this could be one of the most interesting interviews in the entire book.
[_Good morning Guo, and welcome. Or I should say good evening, since you are probably in China, right? _]
Yes, I’m in China right now.
Would you like to introduce yourself to the readers?
Okay. My name is Guo Bai. I’m Chinese, and I’m a researcher at HEC Paris (A/N one of the most prestigious business schools in Europe). I’m a firm believer that, in the future, the boundary of organizations and industries is going to blur. That means that with digital technology and the importance of big data rising, the way people work together will be changed.
So right now I’m working on understanding the organizational form and structure, and how people coordinate their work and actions for complex projects such as smart cities, and that’s what I’m doing right now. Before that, I have mainly been a macro-economist and I’ve been working on the book: China’s Development: Capitalism and Empire, which tries to explain the real logic of China’s reforms.
And what are you doing in China, besides your research?
Actually I’m working on two things at the same time. On one hand, there’s my research, so I’m checking massive projects in China, trying to visit their sites and talk with their managers to try to understand how they were managed.
Secondly I’m also working as an entrepreneur. I’m working on a platform to do equity crowdfunding for projects that are more related to creative design and art and promote a more innovative, creative and beautiful lifestyle.
It’s kind of like Kickstarter but not completely, because Kickstarter focuses more on the product side of things. And us, we’ll be more focused on the startups themselves so it’s more on the equity instead of the product.
May I say “the Chinese Seedrs for lifestyle startups?
Right. We have a very specific focus. Like, instead of rushing to show everyone early technologies and digital stuff, we want to really focus on how we use these things to change our lives. And also, we want to spread this idea of crowdfunding to help people who are interested in other aspects of life such as art, design, food, and drink. And also, we do not only focus on Beijing and Shanghai and those very large metropolitan cities, but we spread this idea to local cities such as the second, third, or fourth tier cities in China.
Equity crowdfunding based on communities could work very well. I’ve done quite a few crowdfunding projects myself—both reward and equity based—and having a community is probably the most powerful tool for a campaign.
So I guess, if you only accept projects that are going to improve their local communities, on one hand they can launch faster, because they are local, and on the other hand the entrepreneur may be already well known and trusted. This definitely helps.
That’s exactly what I’m trying to do because nowadays equity crowdfunding is a very hot topic in China. Very hot business, but mostly people are still doing what traditional VC funds were doing. They were focused on very specific industries and they’re looking for really high-return projects in the short term. But I think it’s a very powerful tool, as you just mentioned, to really mobilize communities. And that’s the beauty of the Internet and that’s the beauty of crowdfunding, and we want to realize that aspect of it.
Indeed targeting a single community is probably under estimated by entrepreneurs. When I work with someone on a crowdfunding project, they all want to be published in the Financial Times or TechCrunch, and sometimes they don’t realize that an article on the home page of TechCrunch stays there probably only for a couple of minutes because there are so many other articles. While an article on an average sized blog in their product’s niche could generate many more sales and loyal supporters.
Yeah, bingo. Great minds think alike then. I totally share your view. Eventually if this platform really attracts a lot of attention it could make the front page of the Financial Times, but that’s not our purpose. Our purpose is really to mobilize the local communities and to really, not only attract people’s attention, but to do things that really can help people’s lives. Directly. That’s exactly why our platform is very different from other platforms.
[_This focus on people is the reason why I call our area “future cities” and not “smart cities”. I’m interested in anything that can improve our lives in the future, not just buildings and infrastructure. In other words, if we focus on the cities, we may end up with buildings full of gadgets and still have a poor quality of life. _]
On the contrary, if we focus on people, quality of life comes first. Sometimes we don’t need expensive technology to improve those lives, maybe we just need to use existing technology in another way.
In China, we have a similar trend. We have already hundreds of programs actively applied to the Ministry of Housing. I guess there are around 300 of them already. And there are, I guess, thousands of unofficial ones but also carrying the name “smart cities”.
But most projects are mainly related to infrastructure and not enough of them are paying attention to the human side of things.
Also many of these projects want to achieve ground-breaking changes, and it requires a long period of time. But really, sometimes integrating what we already have under the same umbrella is already very helpful and it may provide faster results.
[_I would like to talk about your book and what’s happening in China. Together with Michael Aglietta you wrote a book called “China’s Development: Capitalism and Empire”. _]
[_Besides the questionable high price chosen by publisher, this book is a must read. Cities and megacities are moving East, in particular to China and India. So understanding what works and what doesn’t work in China, is a key to understanding our future even in the West. The book is not just about cities, but about every aspect of your country. _]
What is the hottest topic right now in China?
Okay. Well, the book actually has three parts and only the third part deals with the future. But I think the three parts are closely related to each other. You can see that the first part of the book really deals with China’s history. The reason we go so far back into the past is because we believe that China has a very specific state formation process.
We are a country that has been united for thousands of years, relatively without foreign invasion. So the whole country, both its political logic and people’s mentalities, is quite inward-looking. We have long realized the importance of administration and we really want to keep the country united, and offer access to the basics to the whole population.
And that leads to the real logic of Chinese reform, which is really not a result of any kind of doctrine, such as a planning economy or Marxism or the Soviet model. But a process of adjustments to keep this country united and keep providing the people with some basic welfare – that also is the basis actually for the political legitimacy of the regime.
With this kind of very specific state formation process and history, we have a country that is very rich in community culture. I should say, the country has been, for thousands of years, self-organized at a local level. So all these communities, actually they carry a lot of the functions that used to be carried outside China by other institutions such as the state or companies.
That, nowadays, is very interesting because if we talk about smart cities and smart neighborhoods, they are based on a new form of community that encourages a lot of civic participation from everyone. Such kind of participation actually has a very long history in China, and it’s very popular and strong.
So this book is not particularly a book about cities, but about China’s reform logic and what is going to happen in China in a macroeconomic and a politico-economic sense. But it is related to cities in this way. Chinese people are very used to self-organization, are very used to a community way of thinking, and are very used to, and are good at, a community lifestyle.
So our Chines culture is not only very beneficial and interesting for developing local communities, but also for developing a new form of political regime that is a new type of democracy which is more participative, more based on a civic society, instead of a representative way of choosing who is going to have the final political power.
So this, I think, is something that directly relates my book to the idea of cities, especially smart cities.
So your idea is that, if you add technology to Chinese culture, that is already open to self-organization, then this technology may be way more effective there than outside China. In other words, the impact of tech could grow exponentially if implanted in the right culture.
If your idea is proven correct I see an important consequence. China will become the global beta tester for smart cities. Tech will be tested in China and then exported to the world, inverting the actual trend where tech is developed in Silicon Valley and in the West and then exported to Asia.
Right. I totally agree with you and that’s exactly what I’ve been observing. In fact, I just spent last several months in Boston and in other cities in the United States, and we can already observe China’s role.
Of course, nowadays, you (A/N the West) still have a lot of good ideas, good concepts, good technology. But if you’re talking about the application of these technologies, we can see that execution in China is nothing less remarkable than anywhere else in this world. For instance apps like WeChat or WeBlog are remarkable.
They have already, I won’t say replaced, but really have significantly challenged the traditional way of doing media, advertising, how people self-organize; all these aspects. So I totally agree with you. This cultural heritage and modern technology, the combination of these two will transform this country completely and will make China a leader in future centuries. I’m not saying in a general sense, but more in the application of these products, and also in the way of organization.
I see a glimpse of the Chinese optimist here. I’ve been working with China since 1996, and you have always been incredible optimistic about your future even when China was not yet recognized as an important player by the West. I remember backpacking China for a couple of months in 2000, and many of my colleagues were asking “If you are interested in business, why you don’t go the United States or Germany?”
So at the time, many in the West didn’t think of China as a major player in the international community, but all my friends in Hong Kong, Shanghai, Beijing had no doubt about the upcoming importance of their country.
And this trend is so clear nowadays. I’m not going to use the term “superpower” because this has too many geopolitical connotations, but I’m really seeing this country jump forward, that’s for sure. We are not just going to be followers or learners anymore. There are going to be aspects in all areas in which we are going to be the innovators, or the pioneers instead of just the followers trying to catch up.
So Guo, you are a researcher but also an entrepreneur. If you had 10 million to invest in a startup, and it cannot be your startup, what area of future cities tech would you pick?
I would still pick business concerning smart neighborhoods. By smart neighborhood, I mean how to change the relationship among people. For example, ideas related to a shared economy would be interesting.
Nowadays in China, you have very interesting apps for hiring a cook; whether a professional or not, who will come to your family and help you cook, either for yourself or for a group of friends. I feel these kinds of applications really change the relationship among people, really change the scope of the people you have contact with.
And they also change the way you socialize, network and the way you live. So I think these kinds of things, related directly with the management of the neighborhood directly with human relationships, would be the project that would be interested in the most.
I like this answer for a specific reason. Smart cities tech can be very slow. Dealing with bureaucracy can be a very long sales process. So if you develop a new transport system or a new energy system that is revolutionary, it can take years before it’s implemented and you change the life of the citizens.
[_On the contrary, if you start providing a service at a neighborhood level, at the bottom, the execution could be very fast. There is no bureaucracy at the bottom. _]
Exactly. And also, providing services at the bottom is not only economically viable but also I feel it can put pressure directly on the top, for instance on the mayor, to change other systems.
Because when peoples’ way of life is already changing, then they demand different means of transportation, buildings, and energy. And that’s actually a very good place to dig into the issue and force the government, force the officials, to re-think about what they are doing. And then help them and force them to also change the way they manage energy, transportation and other aspects of urban life.
[_Also these apps, because they focus on a Chinese neighborhood, they can be tailored to a specific lifestyle. I’ll give you an example. There is a sort of Uber in China that empowers the customer to call a taxi. _]
[_Nothing special about that but what I found amusing with this app, was that when someone else has booked a taxi, you can offer a tip and “steal” the driver from another customer. Basically if you are in a rush or it’s raining, you could outbid another customer. _]
Such a feature is never going to work well with customers in the United States, I think, but it could work very well in Mumbai or in Rome.
I have another anecdote about Uber in China, which is very funny. Also somewhat of a Chinese characteristic is that they think Uber is a direct competitor of social media platforms like Facebook or WeChat, because it’s actually an excellent way for people to meet each other.
So a lot of the Uber drivers I have met in China spend only a few hours driving, because it’s not their real job. Their primary goal is to meet new people and make more friends, or even potentially girlfriends or boyfriends. I found this idea very, very funny and very Chinese. It also shows how people are very used to this idea of socializing, meeting people: community.
You definitely know this; you’ve been to China so many times and have known China for such a long time. If you go to China’s parks you can see all these old people. They have self-organized these singing groups, dancing groups, whatever. All these are signs of that demonstrate how this country loves self-organization. And with technology, it just brings it to another level.
I found this story about Uber as a dating app so fascinating that I want to know more. So what you mean is that, some people in China who already have a job and make the same amount of money of a Uber driver, or a bit more, at some point in the day, they stop their full time job, to go out and be a Uber driver so they can meet new people and maybe the love of their life.
Indeed. For example, there is one Uber driver I met. He’s the client relationship manager of a big company, and he needs to get out of the office often to meet their clients. Between these meetings he has some free time. So instead of sitting in the office, he prefers to use this time to drive around, and meet more people. And that’s why he became an Uber driver.
I’m not sure if other people are sacrificing their time, but are more like using the gaps of the time they have to get out and to be more human-oriented instead of sitting in the office and handling the paperwork. And that’s what I observed.
So we have to tell Uber that they can become a dating app in China.
It already is [laugh].
Do you know how many Uber drivers found their girlfriend or wife driving people around?
I don’t know the statistics on that, but there are many rumors and people are talking about how huge a threat Uber actually is to dating websites [laugh].
When I interview someone about Future Cities I often ask if they think that technology will improve or reduce the gap between poorer and richer countries. You have already replied to this question. China is not a poor country but because the size of its territory and population, it’s hard to provide a high quality of life to everybody. Based on your information, tech is reducing the gap between China and the West.
Well, I guess it’s very difficult to give a general answer saying that the gap is for sure going to enlarge or to shrink. Because it really depends on whether the country, for instance a developing country such as China, has the proper infrastructure and institutional background that allows this catching up. But that’s just a general comment.
I do believe that tech can be expensive, but what tech really does nowadays is to bring expensive things down to a more affordable price. So there’s definitely a chance. I can’t guarantee that it will, for sure, shrink the gap between the developed and developing countries, but there is a chance. There is also the chance it will achieve that. And that’s exactly what we have learned in China – we are catching up. Inequalities among different localities are also shrinking, thanks to these technologies.
What I see is that, with those technologies, information spreads much faster than ever. I’ll give a very concrete example. Let’s take education, for example. It’s not just about whether you have a good teacher or not. It’s not just about educational resources. Sometimes it’s about information. We all know that good universities have scholarships to help poor families, poor kids. But so many poor families and poor kids do not even know that those scholarships exist. And with technology, they can capture this information much easier.
Also they can go on free courses online and have a better chance of self-education. So all these are really, I think, are very positive improvements and I can see that they are going to be tools to help close the gap between the poor and the rich. And that’s my comment.
And one of those tools is going to be your crowdfunding platform.
I hope so.
What suggestions would you give to someone that wants to do something with China, not necessarily business? Especially someone who is not a top manager.
Well, in my mind, I think they don’t need to do anything special. What I mean is, it’s that China is not this purist country anymore. So basically they just need to be really good at what they are doing and bring this expertise to China.
Buy a plane ticket, do not hesitate, do not heed all the stories they have heard about in China in their own country. Buy a plane ticket to come, learn the language, and then just deal with this world and their business as normal, in the same way they would, or should, do in their own country. And that’s how you should do business with China nowadays.
In the ’80s or ’90s it was different. If you came at that time, you would see a country that was completely lagging behind. You brought to China whatever advanced product or service you had in your country, you traded, and then you were successful.
That age has already passed. So really they have to understand this and really try to build up their own expertise. Try to think about what they can really offer to this market, and then learn the language, be friends with the locals, with the Chinese. And that’s the way they should do it.
[_Would you suggest a specific place to start? Because your options are not limited anymore to a few cities like Shanghai or Hong Kong. _]
There are many cities that come to mind. I would suggest cities in the center of China such as Wuhan, or in Sichuan province like Chengdu, or anywhere actually. It depends on their Chinese level of course, but if they really want to learn the language and learn the culture then they should consider those cities that are more towards the interior of China instead of Beijing and Shanghai where they tend to hang out with their friends from the same country.
Really they should take a backpack, like you did several years ago, and travel the country. They should just look and listen and experience and feel by themselves, and then they would decide because China is so broad and so diverse. I guess everyone has different tastes. So taste it and then decide.
Indeed something that foreigners don’t realize until they go to China is that the north of China is more northerly than Denmark, and the south of China is more southerly to Dubai.
So they tend to think of China as a country like others, but it’s almost a subcontinent in a way. And the cuisine so different, and the people can be very different, although they all have a something important in common. So I agree with you, for someone that wants to do something in China it would be extremely helpful, and enjoyable, to spend a few months traveling around and then eventually picking a place that they like, or a place where they meet people that they like.
In my case, I was extremely, extremely well-treated in Nanjing (A/N the old capital and a university city). Although I didn’t plan to stay there for a long time because there are probably cities that are more suitable in which to do business.
But there is more in Nanjing than business. It’s funny because I have a friend who has just opened a very good French restaurant in Nanjing. The business has been hugely successful, and I just visited Nanjing last week and it was fantastic to see. People there are still very nice. And the city, as you said, maybe does not have too many special features but altogether is very agreeable; a very lovely city to live in.
Actually my train reached Nanjing late in the evening, I had no hotel booked, there were no smartphones at the time, but I was invited to sleep in an apartment belonging to the military college by students I met in the street.
And also what you have just mentioned, to be invited by strangers you met on the street to their home, it actually could happen everywhere in China. Because Chinese people are quite curious and they are very natural with close human relationships.
That’s for example, the reason for the dating feature of Uber in China, and also why we think community, and especially smart communities apps, have very good potential in China. It’s because of this natural closeness with human relationships, I believe.
And what you have just described, I also have experienced with my foreign friends in China in different areas actually. There was one in Beijing, one in Sichuan; they all had very interesting experiences.
People who have just met you and are so happy to meet you and invite you to their family, remain friends, keeping contact for years after. This is just another piece of evidence that shows that China is a country with very long traditions of community and Guanxi in a general sense.
It’s probably easier in a university city like Nanjing and in big cities because so many of the students speak an okay level of English, with some being very fluent. While when you backpack the interior of China, people can still be very friendly but it’s difficult to communicate because at least at the time, it was very hard to find English speakers.
Do you want to add something to close this little chat, or we call it a day?
Well, maybe a general message. I’m really a firm believer that all this technology, Internet, big data, these things are not just for business. And these things are not just technology. They are going to change profoundly the way we organize our activities, the way people relate to each other, and they are going to significantly change what we can do as a group, as a race altogether. We’re in this work for this work. So, well, fasten your seatbelt.
1. China’s Development: Capitalism and Empire
by Michel Aglietta and Guo Bai
2. HEC Paris – Business School
One Drone in Every Home
[_Progress is impossible without change, and those who cannot change their minds cannot change anything. _]
—GEORGE BERNARD SHAW
One day a drone with Artificial Intelligence will look back and thanks Jeff Bezos for promoting the civil role of its drone peer. Every other news bulletin is about war.
Claire Danes is the Drone Queen in the TV series Homeland, Ethan Hawke is a war drone pilot in the movie Good Kill, and the news is all about drones and the war on terrorism.
Bezos and his idea of delivering Amazon goods by civil drones put them in a different spotlight. A startup could be involved in drone market even if they don’t want to compete with the big military providers, no matter whether it is for moral reasons or just business.
The US Consumer Electronics Association estimates a $1 billion market in drones by 2018, an exponential growth from the $130 million this year, with the prevision of 425,000 units sold in 2015.
These numbers are still nothing compared to the estimates made by the Association for Unmanned Vehicle Systems International (between you and me, that means Association for Drones. Toqueville would be so proud.) AUVSI projects an international market of $82.1 billion between direct sales (i.e. drones) and indirect revenue (patents, jobs, etc.) with the creation of more than 100,000 high-paying new jobs.
These are ‘just’ estimates at the moment, but nobody can the consumer drone market is growing fast, so fast that the US Federal Aviation Administration is working to reduce their limits, and US Congress has ordered a regulatory framework for the testing and licensing of commercial drones (the 2012 FAA Reauthorization Act).
Where Is the Money Going?
This is the question that we ask every time a new market booms: “Where is the money going?” Before you launch a startup or a new line of products in your company, you want to be sure that the market is big enough, and not just afflicted by momentary hype.
In the drone market there is definitively space for the private and leisure industry.
At the time of writing you can buy a flying drone for just $78 dollars on Amazon; the Parrot Minidrone Rolling Spider. It’s a toy, but it can fly for real and take aerial shots and video from the sky with the embedded vertical mini-camera. Just make sure you have a look at criminal law if you want to use it in a “peculiar way”.
Timothy Reuter, CEO of a startup called AirDroids, pledged $35,000 on Kickstarter to build a drone equipped with a GoPro camera. He ended up raising almost $1 million in 60 days (2,655% of his initial target).
Let’s Talk About Sex (Again)
Drones are used to shoot porn too. I know that many of you would love to see a link to this movie for the love of ‘tech’. Sorry, I can’t if I want to save this book from censorship. You can, however, Google “Drone Boning Movie” and see what’s going on.
Another booming use of the consumer drone will be in the police forces. The Grand Forks sheriff’s department in North Dakota was the first to publish videos of their use of Qube, a drone built specifically for the police forces by AeroVironment, a company that has developed a their expertise with the military.
Deputy sheriff Alan Frazier of Grand Forks stresses how drones are not an extravagant expense; on the contrary they help save money. According to Frazier’s statement a human-manned helicopter costs around $12 million a year while a drone costs his department just around $10,000.
Biggest Market (I Bet You Didn’t Expect That)
Despite all these activities, private customers, police, and city councils (i.e. firefighters) combined can’t top the amount spent by agriculture, the biggest market of the civil drone industry.
It may sound surprising that we are talking about agricultural application in a book about cities, but it’s not. In fact, the agricultural use of drones is going to push the growth of the cities even further.
On one hand, more programmers and engineers who want to develop drones will move to the cities to access the networking opportunities with investors and the pool of human talent.
On the other hand, more “farmers”—if we can still call them that—will move to the cities to access the lifestyle and networking opportunities, and run their farm comfortably from their apartment.
With the rise of the drone economy, farmers and soldiers don’t need to be on a farm or in a war zone to conduct their business anymore. It’s not yet clear if this is a good or bad thing, but it seems to be an unstoppable phenomenon.
The Real Deal
The real issue will not be if the use of drones is growing or not (it’s growing already), but one of privacy and security. During the Urban Shield Conference, HaloDrop—a company in the drone business—reported to be developing software capable of filming a face from 300 meters away, and passing the images to the police’s face recognition databases.
For good or for ill, the drone technology is already out there. “One computer in every home” was Bill Gates’ dream and the reality has greatly improved people’s lives. “One 3D printer in every home” is also going to revolutionize our cities for the better. “One drone in every home” could be somewhat alarming, especially if the drone is not yours.
1. US Consumer Electronics Association
2. AUVSI – Association for Unmanned Vehicle Systems International
3. FAA – Federal Aviation Administration
4. US Concress 2012 FAA Reauthorization Act
5. Parrot Minidrone Rolling Spider on Amazon
6. The Pocket Drone on Kickstarter
7. Urban Shield conference
INVESTORS & INFLUENCERS
Hon. Jerry MacArthur Hultin
FORMER U.S. UNDERSECRETARY OF THE NAVY AND PRESIDENT EMERITUS OF THE POLYTECHNIC INSTITUTE OF NEW YORK UNIVERSITY
The traditional university is no longer sufficient. The 21st century university is both a classroom and a birthplace of new ventures, and the head of the university should know both basic research funders and venture capitalists.
—HON. JERRY MACARTHUR HULTIN
An introduction to Jerry MacArthur Hultin could take an entire chapter by itself. Thus this is going to be a very condensed biography.
Jerry Hultin served in the Navy, seeing action in the Vietnam War. Upon leaving the Navy, he went back to university receiving a J.D. from Yale Law School. During the following 25 years he served in a multitude of areas, including law, technology, defense, health care and the environment.
He was nominated Under Secretary of the Navy in 1997 by the then President of the United States, Bill Clinton. When he left office in 2000, Jerry returned to university—this time as a professor and administrator, eventually becoming president of the Polytechnic Institute of New York University.
Today he focuses part of his inexhaustible energy on the subject of Future Cities and globalization.
The readers have been briefed about your career in the introduction, however these are cold hard facts. If you don’t mind, I would like to start with a personal question.
You have a J.D. from Yale Law School, and you could have made more money as a lawyer. Why did you choose to dedicate your energy to the subject of Future Cities instead?
With 7 billion people in cities by 2050, cities are best place to combine what people need with new technology—cities are the world’s future. This means during the next 30 years, nearly 3 billion more people will become residents of cities.
Never again on this earth will we build so many new or expanded cities for so many people. Once built, we will never do it again. There is no “do-over!”
So well-built, we can have a century of good life for the citizens of the world. A world we would all like to live in.
Done poorly, we have pollution, congestion, and stagnation—a life of misery for nearly 7 billion people. Not a nice world.
So rather than pursue wealth, we decided to seek impact.
Like a good friend says, success is easy, but impact is hard. We’ve are committed to having impact, even if it’s hard.
You served as Under Secretary of the Navy during Bill Clinton’s presidency. The Navy’s budget at the time was over $100 billion. Entities with such big budgets are always very slow to innovate, and are often afraid of innovation.
Do you think that the quality of our future cities will be determined at government level or by startups developing new technology?
Technology and bright ideas are most frequently the source of transformational innovation. But in the end, you also need to change the culture of government and large organizations—the question is will such transformation come from inside of government—will government have it imposed from the outside.
Often it takes a major, catastrophic event—like the sinking of battleships at Pearl Harbor and the rise of air craft carriers in World War II—to get big organizations to change.
So I see it as a two way street—startups and innovation drive change, but those inside should press for an innovative culture that practices open innovation.
[_You were the 15th President of the Polytechnic Institute of New York University (where you still serve as President Emeritus). Besides your academic success, I am particularly interested in the economic results of the business incubators of the Institute: over $250 million in economic activity. _]
I received my education in different countries, including the USA, Italy and Belgium. Sometimes universities dislike generating business. They tend to think that the role of a university is academic teaching. Adding money to the equation could cause to somehow lose their soul.
How do you see this relationship between business and teaching? And what suggestions would you offer the president of a tech university?
The traditional university—which evolved to exceptionally high quality in Europe—is no longer sufficient. Basic research is still essential, but the market place needs solutions. Today’s young people are eager to learn how to make a better world—so universities should provide them the skills and resources to do this. In the 21st century university, this means an incubator is both a classroom and a birthplace of new ventures, and the head of the university should know both basic research funders and venture capitalists. Universities can do both at once.
If a university president doubts this, he or she should read Pasteur’s Quadrant by Daniel Stokes.
At New York University, we teach people to be innovators, inventors, and entrepreneurs—in engineering and science and also in the social sciences and liberal arts.
This change in what a university does is fundamental to whether China, India, Latin America—and Europe—will build knowledge economies or depend on the United States as the sole source of new technologies and solutions.
[_You are the cofounder of Global Futures Group an international firm that provides consulting and investment services to maximize the role of the “smart city”. Your customers are government, civic, business leaders and non-profit organizations. _]
I don’t think that many governments and business leaders would have appointed a consultant in these matters 10 or 20 years ago. They would have maybe appointed an architect or an urban planner, not a smart city expert.
Do you see a change in the perception of this issue at government level? And what do you think these kinds of customers will require in the near future?
Yes, what has changed is not just urban planning, but new technology has become a driver of new solutions and designs. The physical grid of a city is still important, but the information grid is equally important.
To be a smart city means more than building infrastructure—it means creating learning or feedback systems that use sensors, communications, data, computing, analytics and citizen input to design urban eco-systems that are agile, responsive, and flexible in delivering what people need.
Tech could be expensive. Do you see the gap between cities in rich countries and poor countries growing in the future?
If you gold-plate the solutions with expensive technology, we risk creating a rich / poor divide. But many solutions are not that expensive, indeed may reduce the cost of operation and provide far better benefits and savings.
As our technology for smart cities shifts from hardware to software, costs are reduced substantially. The cloud, ubiquitous sensors, and mobile phones create a way of organizing and delivering services that is less expensive, more ubiquitous, and extremely flexible in the outcome it produces. The smart phone is a good example: the physical network and features of the phone are essential, but the big spike in value comes from the software that turns the phone into a unique, revolutionary source of value for every user.
For example, if you use software (data, analysts, call centers) with ambulances and emergency medical series, as they have in India, you not only reduce cost, you move people to hospitals more quickly and you improve healthcare delivery. For instance, in India this system reduced infant deaths in ambulances by a factor of 5.
Going back to tech, if you had $10 million to invest in startups in future cities, what areas would you pick? What technologies do you think will be in high demand over the coming years?
Transportation and mobility, buildings and energy, healthcare, and education. But don’t overlook some smaller, but high potential opportunities in tourism, governance, security, and citizen input
Fortunately, more and more investors—like social impact investors and clean-tech investors—who are focused on a triple-bottom line of social, environmental and financial returns.
Last but not least, what advice would you give to a young man/woman who wants to open a tech startup in the area of future cities?
Start local and solve a problem or provide a service that benefits citizens in their city. Invent an approach that significantly reframes the way services are delivered. Take advantage of local data, citizens, and other entrepreneurs.
Then, think lean! Read a good book on entrepreneurship like The Startup Owner’s Manual by Steve Blank and Bob Dorf or Disciplined Entrepreneurship by Bill Aulet at MIT.
Is there anything else you would like to share?
I challenge mayors and urban leaders around the world to stand up and seek innovative new ways of meeting the needs and desires of their citizens. If they do, within a decade their cities—and the world—will be a better place.
1. Global Futures Group
2. Polytechnic Institute of New York University
3. The Startup Owner’s Manual
By Steve Blank and Bob Dorf
4. Disciplined Entrepreneurship: 24 Steps to a Succesful Start
By Bill Aulet
5. Pasteur’s Quadrant
by Daniel Stokes
Where Can I Buy My Knight Rider? Insights Into Driverless Cars
[_Being realistic is the most common and travelled road to mediocrity. Why you want to be realistic? _]
Driverless cars are not yet on the market, but four US States have already passed a dedicated legislation to allow their use. Someone non politically correct could point out that it took 30 years for just one State to recognize same sex marriage. From 1970 when the first couple went to a Minnesota Court and lost the case, to 2000 when Governor Howard Dean made Vermont the first state in the U.S. to give full marriage rights to same-sex couples.
Cars and marriage have nothing in common, so I am not going down this path. I will just point out that the driverless car industry is currently valued at 2.4 billion US dollars and a 2015 report by Lux Research estimates that the market will grow 50 times in just 15 years, with a valuation of $102 billion by 2030. These numbers may have influenced the politicians’ decisions more than their love for innovation and technology.
Being Unsexy Is Attractive
The most famous player in the driverless car industry is of course Google. The idea of jumping into a car, playing with your smartphone for the entire trip, and leaving the car to park itself, is so attractive to the media that news about Google Cars comes out every week.
There is another market less sexy but potentially as big and strategic: trucks. Just this year, the first driverless truck hit the road in Nevada. The first company to get the approval of Governor Brian Sandoval is Daimler, which own Mercedes-Benz, among other companies.
Trucks are not as glamorous as cars, but they are still critical for the economy. After all, you can move around a city without a car thanks to public transport, but you can’t move goods without trucks. In fact trains can move from station to station, but not to an the end point.
Martin Ford in his book Rise of the Robots writes about driverless trucks, “the staggering destructive potential of these vehicles probably means that someone is going to remain in the driver’s seat for the foreseeable future”. In other words, humans are going to become backup for robots. Now that’s interesting.
Keep Your Enemies Closer
Moving back to cars, Google has unexpected allies in Uber and the other apps providing driver services. Uber keeps 20% of the fee as a lead generation, and gives 80% to the drivers. It’s easy to imagine that Uber will benefit greatly from moving their fleet to driverless cars. On the other hand, because of the worldwide presence of Uber, they could be Google’s best customer, spreading Google Cars worldwide.
This mutual interest has not being missed by the executives of the two companies. In 2013 Google Venture—the venture capital of Google—invested 258 million into Uber, with the probable return of having Uber purchase Google Cars.
Uber’s smartphone apps for drivers and passengers are based on Google Maps, giving Google inside access to the transportation patterns of their ally. So Uber was obviously not happy when at the beginning of this year rumors suggested that Google was developing their own taxi app. A Bloomberg title at the time stated “Google and Uber are going to War”. The crisis has cooled down since then, but in the meantime Uber is apparently building a team to develop their own maps. Not only that, but Uber is launching their own research center to develop driverless cars in partnership with Carnegie Mellon University, one of the top campuses in the world for robotics research.
The two companies are not really enemies, nor allies. Silicon Valley has historical examples whereby potential competitors helped each other; the most famous case being the investment of Microsoft in Apple when the latter company was going to risk bankruptcy.
Jonathan Zittrain, law professor and co-founder of the Berkman Center for Internet & Society at Harvard University said “It’s a good example of co-petition”.
There is another quote that I found even more appropriate, from Lord Palmerston, Foreign Minister of the British Empire in the distant 1840’s “We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow.”
An Unstoppable Force
Part of my job is to try to anticipate innovations to help investors and big companies in their decision. When it comes to driverless cars, there are many elements that make their growth in the market unstoppable.
1. Saving Lives
The first element supporting driverless cars is of course the potential number of lives saved. A typical statistic states that approximately 90 percent of deaths on the road are caused by human error. Remove the human, and you’ll remove the error. The phrase has a worrying double meaning, especially visible for whoever follows sci-fiction, but the truth behind it can’t be questioned.
2. Humans Don’t Want the Job
The new generation is less excited about owing a car and driving than generations before them. But the real point is not connected to cars, but to business trucks. The American Trucking Association estimates a shortage of 240,000 drivers by 2022. Humans don’t want to drive a truck for long journeys, especially knowing that new speed limits could force the truck to maintain a low velocity (in the USA it is usually 64 mph) thus reducing the number of trips and therefore the drivers’ profits.
3. Companies Want Profit
Sadly this is the stronger element of the three in favour of a future of driverless cars. Companies want profits, and machines are cheaper than humans. No matter if a company owns trucks or, like Uber, runs private driver services, they can save enormously without a driver.
4. The Court System
Ironically the court system that is trying to protect the rights of the drivers is only accelerating the extinction of the entire category. This year the Californian Labor Commission ruled that Uber drivers are employees, while the company sustains that they are independent contractors and the app is a simple marketplace to put customers and drivers in contact. In this specific case, the Labor Commission ordered the company to reimburse the drivers for costs incurred while driving for Uber. These are minor costs, but the ruling may set a precedent for the responsibility of the company in every aspect, including insurance and health assistance.
At the moment, Uber point out that the Commission’s decision is an exception, and they can count on favourable rulings in 5 States. But, if you match this risk with the consideration that the driver keeps 80% of the fee and split the remaining 20% with Uber, it’s easy to imagine that Uber, Lyft and similar companies are potential investors in, and customers of, driverless technology.
In the short run, this ruling is going to create some extra difficulties for Uber. In the long run, the ruling is simply going to speed up the acquisition from Uber and its competitors of a fleet of driverless cars. The Commission is killing the very same job belonging to drivers that they want to protect. It doesn’t mean that they are wrong; it just means that sometimes there are unstoppable forces. Driverless cars are one of them.
When Can I Buy One?
Since the success of the hit TV show Knight Rider, the public has been crying out for a car that can drive itself. This is finally happening. There are slightly conflicting estimates regarding the exact year when driverless cars will be on the market, but all the experts agree on one point: they will be available “soon”.
DMVcom reports that “Google is confident that it will be able to launch a self-driving car by 2025, and Nissan is even more optimistic, saying that it will bring an autonomous car to the market by 2020.”
Quoting Cisco technology trend watchers, in 5 years it will cost us more to drive our cars than to let them drive us.
No matter the exact time, it’s quite probable that the generation attending high school today could be the last generation to apply for a driving licence.
1. Uber Technologies Inc. Vs Barbara Berwick
Labor Commission Appeal
2. Rise of the Robots: Technology and the Threat of a Jobless Future
By Martin Ford
INVESTORS & INFLUENCERS
Eric van der Kleij
LEVEL 39 / COGNICITY
[_What’s their game? Their game is mostly about the data. _]
—ERIC VAN DER KLEIJ
“I am at the center of the center” said Salim, brother of the leading character in the movie Slumdog Millionaire. Salim and Eric van der Kleij have nothing in common, but I think about Eric every time I hear this quote. To understand why, let’s go back a few years.
In 2010 the United Kingdom was trying to create their answer to Silicon Valley. They launched an entity called Tech City in one of the oldest areas of London, and Eric was appointed CEO. The majority of my friends in Silicon Valley branded this idea as a crazy European idea and a project destined to fail. A healthy startup community can not grow in an old area in an equally old city—they said—and it can not be connected to the government.
Well, the majority was wrong. In just a few years London has become one of the hottest centers in the international startup community, and Eric was at the center of this center.
After a couple of years, Eric left Tech City to co-found Level 39, a startup accelerator specializing in Fintech and Future Cities tech. Guess what? For the majority this was a project destined to fail. First of all, accelerators perform better in an area with a strong startup community, but Level39 is based in Canary Wharf, far away from the traditional startup district of Shoreditch. Secondly Level39 is designed to please both bankers wearing ties and coders wearing hoodies, and the common rule says that you fail if you try to please everyone.
So when I was invited by Eric to join the project as one of the initial 39 members, the general consensus was that Level39 had no future. Of course I accepted. I like challenges, and I love to prove the majority wrong.
Well, the majority was proven wrong (again). In just two years Level39 and Canary Wharf have become two hot spots on the international map. Level39 is the biggest accelerator in Europe in the area of Fintech—financial technology—and Fintech is one of the hottest markets for startups. We are “at the center of the center” and it feels very good.
The leadership of Fintech isn’t just another crazy European idea. Check out the interview with Adeo Ressi, founder of the Founder Institute and a legend in Silicon Valley, and you’ll see what I mean.
This year, Eric and his business partner, Claire Cockerton, launched a Smart Cities program for the Canary Wharf Group: Cognicity. This interview is particularly short because of this program, as we are in the closing week between startup pitches and introductions to the investors. And yet this is reassuring. If Eric has decided to invest so much energy into the subject of Future Cities, you can bet that it’s going to become the hottest topic in town.
So Eric, you are the CEO of both Cognicity, a Smart City accelerator program, and Level39, an accelerator/incubator specializing in Fintech and Future City Tech. You have access to both startups and big companies. What’s the most important trend you see in smart cities?
One of the most important trends in recent times has been the move by huge technology companies, such as Google and Intel, either expanding their activities or entering this space. For example, Intel, through their substantial support of the Cognicity Smart City Programme, and Google entering the “urbanisation” sector through their recently announced Sidewalk Labs initiative.
The most important thing to remember about these players is that they do not come with very much built environment experience. So what’s their game? Their game is mostly about the data.
If you think about what an amazing business Google made from just helping us find out what we want to know about, can you imagine what kind of businesses they will enable by knowing about what we all do, where we do it, and for how long, not just for a few seconds as we type into a browser but all the time?
And with players like Intel focusing on the Internet of Thing (IoT) and Internet of Everything in the built environment, we start to see a whole new world of sustainability and consumer convenience, within which the many-faceted concepts of smart cities exist.
The other big trend is, of course, the secure access and ethical custodianship and use of all this new data. It’s going to need a whole new set of security, interoperability methods and adoption of new standards, such as the UK’s Hypercat standard. So I think standards will also play an even more important part of these emerging trends.
If you had $10 million to invest in startups in the smart cities space, what areas would you pick?
IoT security, community cohesion and engagement solutions, also healthcare or mobility in cities. We know we really are facing such a rapid rise in the growth and density of cities, it will become even more important to facilitate a “rediscovery” of community to allow hugely dense communities to coexist less anonymously, in a way that they care about each other and help support, problem solve and trade together.
These are the kinds of solutions that help prevent civil unrest and actually can create powerful micro-economies within the densest urban environments, by curating interdependent microeconomics. Interestingly, none of this is new. This is in fact original “village” and “market square” theory, but now curated by technology and mobiles within a densely populated environment. Imagine any city region that could convene a self-reliant, collaborative and peaceful community by sponsoring a technology-assisted solution to curate such a phenomenon. Priceless!
[_Technology can be expensive. Do you see the gap between cities in rich countries and poor countries growing in the future? _]
I have always held the belief that technology-led innovation that becomes popular and scales within affluent countries must help commoditise costs and simplify user experience, making it much more accessible to developing countries.
Fantastic examples already exist, such as the outstandingly simple but highly economically important mPesa in Africa. I do, however, think we need more entrepreneurs to enter this sector of what we like to call “leapfrog” technologies that can often operate without traditional infrastructure, but often need just a little more connectivity or infostructure.
Also related to this topic, it is encouraging to see the bigger technology players investing in more ubiquitous and accessible connectivity such as Google’s satellite project, which will start to level the playing field, and frankly if they can do this where traditional industries have yet to succeed, then they deserve both the credit and to share in the data of emerging businesses that blossom from this kind of upgrade.
1. Cognicity – Smart City accelerator program
2. Tech City UK
3. Level39 – The Biggest Fintech and Future Cities accelerator in Europe
4. Hypercat – A consortium and standard driving secure and interoperable Internet of Things (IoT) for Industry
Future Cities Investors and Accelerators
If you don’t think about the future, you cannot have one.
Investors and accelerators come and go too, so I keep an updated list here:
If you know of any organization that is not on the list, please add it to the comments on the page above. I truly appreciate your help (and the readers too).
P.S. — This list includes organizations providing grants. Technically they are not ‘investors’ but if you reading this list, you are looking for money for your projects, not for technicalities. Right?
(In alphabetical order)
Strong IoT focus
San Francisco Bay Area, California (USA)
Alpha Lab Gear
Strong IoT focus
Pittsburgh, Pennsylvania (USA)
Angel.co Real Estate Angel Investors
You can use Angel.co to find investors who have already invested in real estate tech (and repeat the search for IoT and other areas)
BGI / MIT Portugal
Smart Cities is one of their areas of specialization
Strong IoT focus
Catapult – Future Cities
Not a traditional accelerator but an organization focused on supporting tech and startups in future cities
Catapult – Transport Systems
A sister organization of Future Cities Catapult
Milton Keynes (UK)
IoT accelerator by Intel, Cisco and Deutsche Telecom
Digital Accelerator by Allianz
IoT, Connected Home, Fintech and other areas
Focussed to a specific area of London, the Royal Borough of Greenwich
Ecci Smart Accelerator
One of their areas is Smart City Services
A directory of acceleration programs and funds. If you are into startups, you probably already know this website
€80 million funding equity free
Global Cities Initiative by JP Morgan
Strong IoT focus
Infinity by NEST
Biggest accelerator in Fintech and Future Cities tech in Europe
Microsoft Ventures is a startup accelerator for any area of business; however Microsoft is investing big resources into smart cities projects. Microsoft CityNext provides grants and support in this area.
Europe’s first property focussed accelerator
Strong IoT focus
New York (USA)
Smart City Accelerator
Europe, different locations
Speed Up Europe
Europe, different locations
Startup Bootcamp Berlin
Specializing into Smart Transportation and Energy
Startup Bootcamp Smart City & Living
Amsterdam (The Netherlands)
This uber famous accelerator has an entire branch dedicated to mobility and smart cities
Detroit, Michigan (USA)
A non-profit accelerator specializing ‘in people data and the future of city’ (plus they are based in one of my preferred cities, Vancouver)
Valluri Technology Accelerators
A Final Note
Smart Cities, Internet of Things, Big Data and every other areas connected to future cities are very hot right now. If you run a startup in this market, you can apply to (almost) every venture capital and angel syndicate in your region. The interview with Simon Menashy of MMC Ventures includes great tips to win these investors. Godspeed my friend, if your company is building something new, I sincerely cheering for you!
[For the want of a nail the shoe was lost,
For the want of a shoe the horse was lost,
For the want of a horse the rider was lost,
For the want of a rider the battle was lost,
For the want of a battle the kingdom was lost,
And all for the want of a horseshoe-nail.]
– BENJAMIN FRANKLIN
In Foundation, a novel by Isac Asimov, Hari Seldon leads the psychohistorians, a group of renegades who have developed a “branch of mathematics that deals with the reactions of human conglomerates to fixed social and economic stimuli.”
In Dune by Frank Herbert, the Bene Gesserit direct humanity along a path of insight and stability through a series of small social interventions.
The novel In the Country of the Blind by Michael Flynn points out how history can be influenced through minimal but well calculated actions.
These are sci-fi novels, but their stories are based on a true and powerful concept: you can influence history without having huge resources. You just need to look for the horseshoe nails; small events capable of generating a snowball effect. This is the message in the poem of Benjamin Franklin, one of the finest inventors and diplomats of all time.
The opposite is also true; we can waste huge resources without having any effective result. In Foundation and Dune the respective empires are powerless to change their future precisely because they focus only on their superior resources. They play hard, not smart.
For the same reason, I’m skeptical when a politician or a corporation says that we can’t change the world around us because we don’t have huge resources to invest.
The most dangerous phrase in any language is “we have always done it this way”.
In the next 10 years we’ll see big corporations disappear as the empires in those books. New small startups will emerge to take up leadership. This is already happening. The life expectancy of a company in the Fortune 500 was around 75 years in the last century. Today, it’s less than 15 years and that lifespan is declining all the time.
By 2030 nearly 70% of the world’s population will be residents of a city, so these cities will be the main battleground between companies. It will not be a battle between evil corporations and good startups, but between innovation and stagnation. Some big corporations will be good, some small startups will be bad, and vice versa.
Add to the mix the rise of Artificial Intelligence, the Internet of Everything, robots, sexbots, drones, smart grids, driverless cars and 3D printers and you can tell that the world is destined to be a very interesting place.
STEFANO L. TRESCA
San Francisco, USA
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Smart cities, drones, 3D printing, A.I., driverless cars, Internet of Things and other innovations that used to be sci-fi just a few years ago. ‘Future Cities Overview’ is a stand alone book of a larger collection titled ‘Future Cities’. Your Neighborhood Will Never Be the Same By 2030 nearly 70% of the world’s population will be residents of a city. That means 3 billion more people will be living in cities in the next 30 years. Our generation is destined to witness an incredible number of new cities and new buildings built to host our new neighbours. Once these cities are built, they won’t be built again. And they won’t be changed easily either. As in the tale of Alice in Wonderland, to get the right answers, you first have to find the right questions. I don’t have all the answers—nobody does—but I’ve collected many interesting tools along the road. These tools may help you and me to understand current and future trends in tech and culture. It’s a small competitive advantage, but in the coming days it may be essential. Enjoy the insights and the interviews. If you don’t agree, feel free to contact me. I welcome any challenge. This isn’t a one-way conversation, after all. This is a global game. – STEFANO L. TRESCA Table of Contents • Welcome • Would You Like to Share Your Story? • The Secret Life of an Uber Driver • Minerva Tantoco (New York City CTO) • Sex and Robots: Do Humans Dream of Electric Mates? • Guo Bai (China) • One Drone in Every Home • Hon. Jerry MacArthur Hultin • Where Can I Buy My Knight Rider? Insights on Driverless Cars • Eric van der Kleij (Level39 / Cognicity) • Future Cities Accelerators and Institutions • Horseshoe Nails • One More Thing