The New Yorker ran an essay by Tad Friend describing the growing effect of entrepreneurial boot camp Y Combinator on the prevailing ethos of Silicon Valley and the funding practices of venture capitalists. The piece profiled Sam Altman, the successor to Y Combinator’s founder and its guiding spirit, Paul Graham.
If Graham’s name sounds familiar, it’s because he was co-founder of Viaweb in 1995, by general report the first application service provider (and, by his own description, the first software-as-a-service company). Viaweb was later bought by Yahoo for $49M – no doubt incentivizing Graham to a life of both invention and venture investing. A computer scientist, he also wrote the first Bayesian spam filter, for which we can all be grateful.
Two decades later, Graham is a leading light in the Silicon Valley ecosystem who has driven major advances in our innovative technology-driven economy. He’s an essayist in his own right and a widely applauded thinker with respect to innovation and venture capital. Not coincidentally, he’s a champion of thoughtful design. In addition to earning his BA at Cornell and his MBA at Harvard, he studied painting at the Rhode Island School of Design and at the Accademia di Belle Arti in Florence.
As Graham’s successor, Altman also has serious chops, including acting as co-founder with Elon Musk of OpenAI, the nonprofit focused on ensuring that artificial intelligence doesn’t grow so strong that it threatens humanity’s existence.
Friend’s article on Altman is a fascinating read – well worth the quarter-hour it takes to get through. As I read it, it struck me how professionalized and formulaic the practice of fostering young businesses has become in Silicon Valley. Maybe one size doesn’t t all in the world of so-called “seed capital,” but it does appear from reading Friend’s essay that the Y Combinator model – which has helped startups worth some $80B – is a process that works, that young companies strive to get into, and that produces the occasional unicorn.
I also found myself being reminded of the importance of the principles of design thinking not only for startups, but also for established companies seeking to innovate and even revolutionize their own businesses. Innovation today is very much about a pursuit of excellence – even perfection – that can never be realized.
Does the Y Combinator process always work? I’m sure not. But it surely reminds us of the fragility of any innovation. “Excellence” is a word describing something that has reached its zenith. “Perfection” signifies something that cannot be improved. In the technology realm, achieving excellence and realizing perfection are no longer enough. Today, reaching an objective and then standing still is a failure. The moment a company considers its product or service to be fully realized is the moment it sits
back – and the process of exploring new designs, applications, and alternatives for meeting the needs of customers ends. That’s not success. It’s how innovation falls into irrelevance.
It takes vigilance and energy to overcome the presumption that in achieving excellence, one’s work is done.
Designing For Success? We’re Not Done Yet.
Waterfall to agile. Dialoguing to ethnographic research. Real-time design to prototyping and testing. Lean start, fast fail. Even as the phrase “design thinking” has become widely known and is so in vogue and relevant now, it’s useful to be reminded why it works. We’re at the point where we can look beyond the phrase to what it signifies. Design thinking is a process of fostering human innovation. It’s human-based, and it’s generative of ideas. It’s iterative and cumulative. And it’s never over.
That’s why design thinking is critical. Our conception of what is excellent today can be eclipsed in a heartbeat because of what technology enables. Simply put, the bar for realizing perfection will keep getting raised because the barriers to entry are so low. Technology is not only progressively more powerful and less expensive, but it is also a great leveler: All innovation builds on previous breakthroughs, and the process is blindingly fast.
That’s not all. The de-capitalization of technology, its economic democratization, and its globalization are allowing for new forms of innovation that help us to anticipate, express, react to, and even shape cultural nuances that matter. What does that mean? It means changing behaviors and new paradigms, and it means new expectations on
the part of consumers.
Take instant messaging services. These days, we don’t pick up a telephone in the hopes that a friend or colleague will answer, or plan to leave a message if they don’t. Instead, we send a quick text message to learn if they have time to talk. Not only has communication technology evolved, but human beings have also moved beyond preexisting technologies. A member of the millennial generation considers it almost an affront to receive a phone call while they’re working without first checking on their availability (I’ve seen them roll their eyes).
It’s not that technology has evolved. It’s that human behavior has evolved because of technology. The concept of excellence in communications has changed – and
will continue to change. The bar keeps moving. Up.
Technology, Yes. But Also Context.
This doesn’t mean achieving excellence is unattainable. It does mean companies can never stop striving. Companies like Apple and Tesla are the poster children for everything that has worked well in the last decade in technology; but you can bet they are not only looking for the Next Big Thing (like everyone), but are maniacally focused on continual improvements to their products, services, and cloud-based “infotainment” ecosystem. It’s not about technology, it’s about how people interact with their products, services, and brand experiences, and what they enable us to do.
Similarly, take the directional application which allows drivers to guide others to the best route through their devices. Use it to drive in any large metropolitan area today, and you can easily come to appreciate an app that is constantly checking all the traffic. Where the choke points are, where the potholes and accidents are. (And, yes, even cops with a speed gun.) It’s real-time data that tells you the best way to go.
Waze defines excellence by how it can remove friction in a situation where there’s a lot of it: real, physical, sticky friction that slows us down, frustrates us, wears us out, and makes us late. But in actuality, Waze creates moments of delight. By removing friction, it makes us feel superhuman. The app sits at the intersection of technology capability, data-gathering, processing power, and social interaction. Together, these create contextualized information to meet real human needs.
The Challenge? Which Waze Forward.
That is how best to present the challenge to today’s companies, both large and small. The challenge of constant innovation – a pursuit of excellence, even perfection – is how brands create magic, but the work is never complete. There’s always another step based on how humans interact with technology and design.
That’s why ongoing efforts to develop technologies like wearables and virtual reality are evolving so rapidly: As new ideas emerge, they have to be proven to work in the realm
of real human use. Studies are showing that the rate of adoption for wearables, for example, is very high; but the abandonment rate is extremely high as well, with most adopters dropping the technology in 60 to 90 days.
That’s human behavior, demonstrating the success of their interactions with technology by voting with their feet, as it were. So, the work is never finished. And that’s why the cycle continues, because brands strive to achieve excellence and strain for perfection. Perhaps they should never be convinced they’ve gotten there at all.