Does the world seem to be moving faster these days? According to Azeem Azhar, that’s because tech is advancing faster than our ability to adapt to it. Azhar recently joined us in an edition of our event series, Pitch Live, to discuss the implications of this widening gap for startup founders. Dig into our key takeaways, and take a look at Azeem’s full presentation in Pitch.
Azeem Azhar is an author, investor, and the founder of Exponential View, a newsletter and podcast dedicated to understanding our future. His new book, which we highly recommend to founders, is called “the Exponential Age" in the US and Canada and "Exponential" elsewhere. In it, Azhar explains that we’re living in an era in which the rate of technological progress is dramatically increasing, and our society and institutions can’t keep up. This “Exponential Gap” can create chaos and disruption, he notes, but the same forces can pave the way for positive change.
In a recent edition of Pitch Live, Azhar previewed insights from his new book, revealed the traits of successful, sustainable businesses that will stay ahead of technology’s disruptive curve, and highlighted founders’ role in helping society keep pace with progress.
Founders provide a bridge to the future
Using the early days of Facebook as a comparison, Azhar noted that newer social media competitors like Bytedance (the company behind TikTok) get to build their products on fast-moving new technologies, which means they can grow at a rate that makes their predecessors’ success look unimpressive by contrast. The proof is in the numbers: Startups are now hitting $1B+ valuations in just a couple of years, which not long ago would have been unthinkable.
So the savviest entrepreneurs recognize tech with the potential to go exponential — which, first and foremost, is about having vision.
“The key task of a founder,” advises Azhar, “is to be a bridge between a technology that isn’t quite ready, and a market that isn’t ready for any number of reasons.” A great founder can connect an emerging technology with a future audience that will use and even depend on it. So as you turn your inspiring idea into a plan to build your business, remember to choose your tech foundations carefully, and with scale in mind.
Timing is everything — not being first to market
According to Azhar, the best moment to adopt new tech is generally when it’s still a bit expensive, knowing that in a few years that technology will be both better and cheaper. But don’t wait too long: Countless startups have gone bust waiting for the sweet spot between novelty and practicality. The trick is to pick the right moment on the “cost curve”.
There is no one-size-fits-all-solution to this problem, so as a founder, you should make practical decisions based on what you can afford to invest in, and the team you can build to work with it. You may not get to be first, but sometimes, it pays to wait for your moment.
“The thing to bear in mind,” Azhar said in a follow-up conversation, “is that declining prices lead to ubiquity, and ubiquity creates complementary products and services. It may be that, as a founder, your place will be to provide one of the complements rather than the tech itself.” This can still be a great, and greatly lucrative, place to be.
Tech isn’t neutral, nor are those who build it
When prominent entrepreneurs find themselves in hot water (or, say, called to testify in front of Congress) they often jump to a familiar defense: They just provide the platforms, and it’s up to the rest of us to decide how to use them.
But tech is not, in fact, neutral: The political, economic, and social values of people who build things will inevitably shape what they choose to build and how. This affects everything from company culture, to how products are used, to the impact those products have on the world. And when things get ugly, they get ugly on a bigger scale than ever before — sending leaders scrambling to do damage control.
Azhar suggests that founders must recognize and account for the inherent bias of their products. That means articulating your own values and building them into your mission from day one. “If the starting point is to disrupt rather than improve... I think it is hard to frame a sense of responsibility,” he says. Not doing so can signal that you lack foresight at best, and at worst, that you truly don’t care.
Founders can help shrink the Exponential Gap
Driven by profit, companies often fail to check themselves, until forced to do so by what Azhar calls “the regulatory value of the norms and customs and habits” of our society and its institutions. But the Exponential Gap is widening: Technological progress, and the companies that run on it, are outpacing our society’s ability to push back.
In this pivotal moment, the tech industry has a big role to play in building a healthy economy and a sustainable society. Founders can carefully choose who they want to do business with, internally and externally. Investors can make values-driven choices about where to put their money. And successful entrepreneurs can use their huge social and political capital to educate the world on where we’re all headed — and how we can be ready.
And of course, it all comes back around to the business. Founders choose the impact they want to make when they choose what to build in the first place. As tech increasingly leads us on a journey into the future, we can chart our course with those choices.
Check out Azeem Azhar’s full presentation below, and join our community to stay up to speed on our next events.