Paul and Rich are proud New Yorkers through and through, but sometimes they can’t help but feel jealous that California kicked NYC to the curb when it comes to tech and Silicon Valley. This week, they unpack how that happened and try to figure out what it is about California that sparks innovation. They also speculate what the next technological revolution will look like and discuss whether or not we’re on the cusp of a crypto explosion.
Paul Ford You’re ready to get real? You want to get real? I’ll get real.
Rich Ziade Let’s get real.
PF Let’s go there. Let’s go there. [music ramps up, plays alone, fades out]
PF Well, well, well.
RZ How are you Paul?
PF I’m doing fine. Living my life in and out of the office. Holidays are here.
RZ Alright, enough small talk. I don’t consider myself an envious person.
PF No, no, never seen any of that.
RZ I’m not an envious person. But you know what I am Paul?
PF What are you Richard?
RZ I’m a New Yorker.
PF God, that is true. You are a genuine New Yorker. I think you’re also the kind of New Yorker where like, you might not recognize you as a New Yorker unless you’re a New Yorker. And then you’re like, yeah.
RZ It’s a New Yorker. I’m a New Yorker. And I love New York. And for a very long time, I’ll tell you a weird, weird story. Not a story, just a little factoid from growing up. We were immigrants. We were like 20 of us Lebanese fleeing the war in the late 70s. Ended up in Bay Ridge, Brooklyn and Bay Ridge, Brooklyn for those that don’t know, you can do this on Google Maps, there’s a strip called 86th Street where everybody’s always double park because there’s a lot of shops and there’s Wendy’s and there’s Century 21, which isn’t there anymore, just as intense, like Main Street in the middle of Bay Ridge. And then my family would buy the paper every once in a while and they’d be like it see a headline like, you know, shooting on 86th Street. And they didn’t know there was another 86th street. They thought the 86th Street was–there’s only one 86th street and that’s the one that runs through Bay Ridge, Brooklyn.
PF The world ended in Brooklyn.
RZ You know, Saturday Night Fever actually tells this story about this knucklehead from Bay Ridge, who tries to get into the the social circles of Manhattan where everybody’s reading and listening to Dylan and he’s in Bay Ridge. And it’s another world. It’s not just a river between them, right. And so I am a New Yorker. I knew Brooklyn before it became Brooklyn, lowercase, chiseled into distressed wood.
PF Well, Brooklyn when I first moved to Brooklyn was understood to be like a little bit on the job. But you can really live there if you are a serious New Yorker.
RZ Yeah, it was sketchy. So growing up, I love tech, all throughout, even through college where I didn’t even major. I was a bad math student actually. I was really good at philosophy. My philosophy professor wanted me to major and I was like what am I going to do with that? I can’t sell anything with that. And I went to law school. But throughout I would go home and play with computers. We couldn’t afford an Apple 2 when I was little. It was too expensive. It was 1000s of dollars. It was a lot of money.
PF 1980 dollars.
RZ It’s a lot of money. I could afford an Atari 400. And then I went to my dad and I was loading software with a cassette tape–
PF Computers cost as much as it used car and they sucked.
RZ Bless my immigrant parents. They had no idea what the hell was going on. They didn’t understand what I was buying. It look like a typewriter, right? But I loved, loved, loved technology. And there’s a part of me that’s envious, Paul. I wish the explosion, the explosion of innovation that came out of frankly, California, Palo Alto, Xerox PARC, Hewlett Packard. I couldn’t afford a laser printer for years, Paul, and I was like, wow, look, you can’t see the dots.
PF When you first saw a laser printing, you smelled it, smelled kind of good. It was all burning chemicals. And you were like, one day I’m going to have one of those. And it’s going to be refurbished. And it’s going to come out of a newspaper ad in New Jersey. [Rich laughs]
RZ And I remember just loving tech. And I was like, you know, New York City is just the best place in the world. Everything happens here. It’s a swirl of energy and chaos. Why? Why? Why would it come out of–and I’m going to use a derogatory term–a shitty suburb in Northern California?
RZ Why? I’ve seen the images of well, last thought just that the image of the Wozniaks, Jobs garage, and it’s so non descript and just has no character and I’m thinking to myself, yeah, but you know, there’s Bleecker Street. [Rich laughs]
PF Yeah, okay. I’ve thought about this a lot. First of all, let’s be clear, I love New York City. I live here now. I’ve lived here long enough to–it’s funny. You ask yourself when you move here from somewhere else, like Am I a true New Yorker? And I think you become a true New Yorker when you realize that that isn’t–it’s an utterly irrelevant question. It simply is do you own real estate? [Rich laughs] It’s very easy to figure out New York City. New York City wins everything and has everything. It’s a greedy, self important, annoying place where you also find some of the smartest, most thoughtful people, the most interesting history that you can get in America. Right. So it just stings that the greatest single capital expansion and revolution in America in the last 70 years happened in California, like it just hurts.
RZ Yes, yes.
PF New York City does not understand. New York City is kind of an angry toddler of the city. Like, it’s just like, why didn’t you give it to me? Have you been to Cornell Tech?
RZ I have not been to Cornell Tech. My old agency actually did work for Cornell Tech.
PF It’s okay. It’s easy not to go to Cornell Tech. Cornell Tech is a giant, lovely campus for the study of technology with lots of students. First of all, it’s on the butt end of Roosevelt Island, which is not one of the city’s hotspots, like Bay Ridge is actually Manhattan when it comes to Roosevelt Island.
RZ Okay, let’s explain Roosevelt Island for the rest of the world.
PF First of all, if anyone can explain Roosevelt Island–
RZ I’ll explain it in two sentences. There’s the good paper towels. And then there’s the generic brand that has this supermarket logo on it. And it’s just called–
RZ It’s called Paper Towel.
PF That’s Roosevelt Island.
RZ Grocers pride.
PF Yeah, yeah, that’s Roosevelt Island.
RZ But why? Why didn’t this happen in New York City? Everything happens in New York City, man,
PF There are a lot of theories about this. Okay. So one of the books that actually goes into this is called What the Dormouse Said, which is a quote from a Jefferson Airplane, not Starship, Airplane song. And it’s by John Markoff. And that was about how everybody in the early days of the computer industry was essentially incredibly high and just dropping an enormous amount of LSD. A little more complicated then that.
RZ Factor one. I mean, we were getting high too, except we were doing like, you know, beat poetry.
PF We were and we were doing like quaaludes so that we can have encounters with our maids. I mean, it was a bad scene. [Rich laughs] There’s a lot of reasons. I think there’s a couple reasons, I have gone out to California, and I did the drive between Apple, the old Apple campus before it became a giant–
PF Spaceship. And Xerox PARC. Xerox PARC is wonderful. It just seems to be like a giant basement and there’s like horses nearby. It’s beautiful. California is beautiful. It’s a big part of it. It’s incredibly beautiful. It’s very chill. And the drive between Xerox PARC and Apple is not a long drive. It’s like minutes. It actually turns out that everything’s really close. And the key thing too, I think is that it was a drive. I think that if you’re in the East Coast, you know that money makes the world goes around, and you know how power works. And you know that banks need giant ass computers coming out of IBM to do all their stuff. And then there’s gonna be money and opportunity there. And there is a kind of computer revolution happening and Unix is getting created at Bell Labs and so on so forth. But it’s all in the context of these enormous organizations like IBM and the Bell Telephone System. Bell Telephone System, a million employees, giant unions.
RZ Let’s plot all this on a map. All right. IBM is in Armonk, New York. It’s in upstate New York.
PF A lot of the headquarters were here too. But yes, yes.
RZ Here being New York City. Yeah. Huge building in New York City. Huge presence in New York City. Okay, IBM is here. What’s the deal? I mean, why wouldn’t–Xerox, I don’t know the history of Xerox, like I’m sure their main–
PF Xerox is upstate along with Kodak.
RZ And Kodak! And what the hell? Like Apple shows up out of a garage.
PF This is what happens when you, like literally, they have the money in the power. And they were invested in all the processes that were making more money and power and they were serving those. And they very consciously when they set up the research lab for Xerox, they set it up Palo Alto Research Center at Xerox PARC, they set that up in California. And I think there’s a couple things going on. I think about this a lot, right? Because everybody talks about innovation. Part of it is just raw luck. A huge part of is it just I think you got to go really simple when you look for causes. A huge part of it is just like it just wasn’t here. And I think the third thing, this is my little like joke, but I’m also half serious about it. That five minute drive between or whatever it was, it wasn’t long between PARC and Apple.
RZ But let’s tell people what Xerox PARC is. Xerox PARC is the Palo Alto Research Center.
PF That’s right. And so Xerox had funded this effort to figure out the future of all the stuff, office stuff. Xerox made copiers.
RZ Xerox made copiers, but had so much money and was thinking, well, how are people going to work 50 years from now? And so they opened up essentially a Research Center in California, away from the sales targets that are happening all over Xerox, probably emanating out of New York and emanating out of out of New York City, right, out of the east coast.
PF Close to Stanford where there was computer stuff happening. And look, I mean, Silicon Valley was was moving. You had Ampex, the big tape recording company, and there was defense contractors and there were all these things happening with tubes and with different kinds of technology happening here. So it made sense. Like going out to California, they’re into this out there.
RZ Okay, let’s pull them up. First is you’re saying they were near each other, proximity, geography.
PF The same is also true of MIT. The same is true, like you also had, you know, Bell Labs in–but I think it’s also just California. California was just like–
RZ Explain that.
PF Oh, you’re eating almonds, you’re looking at the sea, go surfing, go hiking.
RZ So it’s an environment that fosters creativity, and out of the box thinking?
PF And they’re high, like everyone is just extremely high, and the wine is good. And the 60s have happened, like everybody’s on the pill, like, it’s a pretty good time. But the key thing for me, the killer, so the drive is important here. This is where you can understand there’s this moment in computing history where–and it gets told a lot of different ways and a lot like it’s sort of like Steve Jobs stole the idea for the interface from Xerox PARC, whatever. There was actually a lot of money exchanging hands, Xerox got Apple stock, all this. But there’s this point where literally, the Apple people went over to Xerox to see what they were doing with this new their system, which was called SmallTalk. It was a computer programming language that ran the whole computer. And it had a whole very expensive rent on these very expensive computers. But it had a windowing system, it organized stuff through the graphical user interface. And it’s like, this was not like entirely their idea. But the thing that we would recognize as a graphical user interface really came out of there, there were other sort of boxes on the screen, it’s built like this, this where the mouse moves around, and there’s, you know, icons, you click. So they had created this, and Apple went over, and they saw it, and they went, wow, okay, and then they went back. And that’s what happened to the Macintosh. So that’s how you get the Mac.
RZ Yeah, this is the future. I mean, it’s been well documented, Steve Jobs went over and lost his mind, essentially,
PF It was just like, okay, we got to do that. That’s what we got to do. And we got to be could fit in a box that doesn’t cost $20,000, or whatever, the Alto or whatever the hell the Xerox machine is. We have to run on 128k.
RZ Okay, I want to share sort of how I’m seeing this. We as Postlight, we are a, you know, young thriving agency, have visited quite a few innovation labs across organizations. And innovation labs are a product of a couple of things. They’re a product of excess money, you have to have extra money to do innovation. And they are also a product of usually a small contingency of advocates, who want to look ahead and want to be in lockstep with change as it’s happening, or create change that happens. But we’ve seen this consistently, Paul Ford, it is grossly neglected. And just to finish this thought, I think what you had in California, more than anything else, is that you are out of the revenue target rat race, you are asked to do things that were weird and surprising. And the typical sort of gravitational pull of business was too far away, such that you got to think about–I mean, look, the graphical user interface, you’re talking about when Apple runs into it. But really, it is a product of this convergence of psychology and sociology and technology. How is that gonna ever materialize inside of–I mean, I love upstate New York, but they are thinking about the next IBM.
PF They’re create the graphical user interface. Ryan Beck is not going to come up with the next GUI. That’s right. Look. So there’s a few things. First of all, there’s a culture of synthesis going on out there. So literally when Alan Kay is at there, booting up the the research lab, Alan Kay’s is very important programmer, thinker philosopher around technology. He said, Go get the Whole Earth Catalog, which was a big book about all the different things that are happening all across the counterculture, and kind of a list of books. He said, go get all those books, right, like, build us a library of all the new innovative thinking out in the world. And I mean, you’re talking beanbag chairs, and you’re talking, so on and so forth. There’s another thing going on in California, which is people drive everywhere. And I think about this a lot. People don’t drive everywhere on the east coast in the same way, but they drive everywhere in California. And when you drive, a few things happen. You have a dashboard that is immediately responsive to the state of the car, and you move the wheel on the car moves. It’s an incredibly reactive, fast system that augments what you are able to do as a human, you go faster. Bicycle does that too. But a bicycle doesn’t have a dashboard doesn’t have those little systems. Everybody’s like high out of their mind. They have all these books. They’re drinking great wine. The sunlight is beautiful.
RZ They don’t have to hit numbers.
PF They don’t have to hit numbers, and they are driving around in relatively reasonably priced devices that get them from point A to point B and are immediately responsive to anything they do. You look at computers of that era, and it’s just like really, really ugly code. Just ugly. You run something overnight and it prints out. Okay. That’s your whole experience of computing. Or maybe there’s like a command line thing going on. But it’s pretty. I mean, like, those are your Apple 2s are showing up in the world, right? And they’re going, yeah, you know, what if it was more like a really cool car, which is where we ended up, right? Because of course, people like reactive systems that you touch and things happen. One of the great features of any product ever in the world is speed. It’s the hardest to maintain. You can maintain almost any feature, but speed. And it’s shocking, because computers get faster. Programs want to slow down.
RZ Okay, so combination of things. You’re out of the rat race, you’re not on a hamster wheel trying to make money.
PF There’s another important part, which is that benign neglect is wonderful if the people are productive and getting stuff done. And they usually kind of know enough to like figure out, you know, we need to make this useful. So at Bell Labs, they made sure that Unix was useful for typesetting patents. And at Xerox PARC, they would occasionally kind of send the signal back and be like, hey, we think we’ve got the future of, you know, automation and workflow here. And we’re going to get your, you can plug this into a publishing system or document preparation. You understand that Xerox, right? I think what’s really tricky is when it starts to succeed, everybody shows up, but the structure isn’t there to migrate the big idea into the larger host organism. So it’s similar to why acquisitions fail. Where big companies buy little companies.
RZ Okay. I mean, let’s share how this movie ends. I mean, Xerox is the funder of all this incredible, just a burst of innovation, and they don’t cash it in!
PF No they did they made their money back, it was just on those terms. It’s only when the in retrospect, when you look back and you’re like, oh, okay, that was–
RZ They licensed the tech.
PF There were $3 trillion to be made, right. But there was actually, they got like, 100 million of value out of their Apple stock or something like that. Like they probably did just fine.
RZ The Xerox they did not carry forward.
PF The could’ve run the world.
RZ Yeah, right. Right.
PF Xerox could have been Microsoft and Apple and IBM combined. Right?
RZ Alright, we’re gonna play a little game, Paul Ford. I like using your whole name. Such a good name. I’m gonna name a company. And I want you to tell me why they failed. And by failed, I mean, made billions instead of trillions in many cases, but I’m going to name the company. IBM. And I’m going to whisper the words OS 2.
PF That’s a fascinating one, IBM never was able to crack consumer marketing–a little bit with Lenovo. In my opinion, there was always just too much money flowing in from extraordinary enterprise, supercomputing, mainframes, and so on. They had a tremendous run with they’re incredibly unattractive and difficult to use personal computers, but they just couldn’t get, they couldn’t crack the consumer.
RZ Yep. Eastman Kodak.
PF That’s a tough one. That became a giant bureaucratic organization. And then just a million competitors showed up in a million ways. And in particular, digital photography.
RZ Okay. If I’m not mistaken, I read an article, I think that a lot of the innovation around digital photography came out of their r&d labs.
PF Yeah, it’s brutal. Like the Kodak story is actually a brutal one. Like, that was, you know, you went there, and you work there for 35 years. And you worked in lenses. Right?
RZ No, but there was, I forgot the guy’s name. He was walking around saying, you guys, you got to take this seriously. Or we’re toast. And they’re like, leave us alone.
PF Oh digital photography? Well, this is the thing, right? And then do you go open up your digital photography lab somewhere. But I don’t think they were in the greatest shape and all that was getting going either.
RZ Alright. Xerox.
PF Xerox, these are still giant organizations, but it wasn’t able to capitalize on the innovation and created and its product became more and more legacy. It moved into categories like giant document archives and stuff. And people still need copiers, right. But it is, nobody thinks of Xerox and thinks that’s the future of the workplace.
RZ As we look ahead, I can’t help but observe how the monoliths that dominate today, are much more efficient at closing up their flank much more aggressively.
PF They know the r&d has to be there. There will never be a moment where Google Drives over to Apple.
RZ Yeah, right.
PF It’s like, hey, what do you guys do to my headphones? Not gonna happen!
RZ Can I make a phone that’s gonna blow Apple out of the water? Is that even conceivable at this point?
PF No. [Rich laughs] It’s not because the category of the phone is actually banana cakes. You need to make cameras and software–
RZ Teams of 1000s.
PF It’s a moat unlike any other. It’s the same kind of like, in terms of competitive moats, it’s like the United States having the Department of Defense and our military. The only way you vanquish a foe of that scale. We saw it with the Soviet Union, we saw a little glimpse of it over the last five years in America, is from inside. It’s very, very difficult to get them from outside. But if you if you do what we did with the Soviet Union, which is just like, you know, essentially false competitive starts and endless, bad paths with lots of political infighting can undo these organizations. But for the most part, their moats are so big. We’re also in a funny spot too where there’s really not that many competitors in the phone space. I mean, there’s a lot, you know, there’s Huawei, and there’s Samsung, and so on. But they’re all using the same parts. They’re all using the same operating systems, like you’re really in a position where you can get in and kind of like, mess around a little bit. But how are you going to get in there?
RZ I don’t know if we’ll ever see a perfect storm like that again, where I think it was, you know, the transistor and the silicon was taken hold and it’s there. It’s just you know what infuriates me. They could go hiking, they could design a user interface and then go hiking that afternoon. And that’s upsetting to me. Because I played stickball on the streets of Brooklyn, Paul. Alright. [Paul laughs]
PF We’re in a funny spot. Because what you’ve got is California is out there. The Bay Area’s out there, Andreessen Horowitz, things like that are trying to make their own stock market. They with Blockchain, which is truly something California loves, they have created their own economy, currency. If you want to know what California is going to be doing over the next 10 years, look at anything where New York City has a competitive edge, and they’ll be trying to clone that using like bad programming. That will be 100%. In fact, they really want to have their own media, right? They want that they want to own the media industry as well, they keep going for that. So they’re not able to do it. We, on the other hand, keep trying to build like centers and incubators in New York City, but it just doesn’t work. Because you don’t have half a million nerds drinking the same cup of coffee talking about the same stupid technology. And if it happens that that stupid technology is the one that can make you a trillion dollars, they’re all just sitting there. They’re all like okay, let’s go.
RZ This is very much driven by, you know, the campus setting versus the office setting.
PF Oh god yeah.
RZ That openness, that ability to like decide to end your day on the lawn, rather then at the cubicle. And it’s that free flow of communication of ideas, whereas New York City wants to optimize fast, right? It’s like, okay, I mean, look, you look at the history in New York, and it’s a glorious thing. It’s like the hatmaker guy who just figured out a way to make the hats 10% faster and was able to make them $1 cheaper.
PF New York City is a constant response to the fact that rent is too high. Like that is everyone in New York City is basically existing in a state of the rent is too high. This is what I wonder about Silicon Valley. It’s incredibly expensive to live there.
RZ It’s not cheap anymore.
PF It’s dominated by a few giants. And that curve, the easy wins are gone, man. There are no easy wins. And it’s not like they didn’t work hard. I mean, when they came up with, you know, Intel is not an easy win. And Apple’s not an easy win. But like, there was a lot of empty territory for consumer products and a few really smart people who saw it. Like how the hell do you fabricate that? I probably have 200 different transistor powered devices floating around my home and office.
RZ There’s a reverence towards the startup, where here there’s a reverence towards the big office tower and the big company, right?
PF Bloomberg is the perfect example. Bloomberg has a skyscraper.
RZ They have a skyscraper and it’s spectacular. And it’s a product of this flare up of Innovation way back when where he saw an opportunity. And he’s been essentially capitalizing on it ever since. But I think in California, you know, the high rise doesn’t impress them. I think innovation does, that sort of fertile soil does.
PF It’s not that hot.
RZ When I lived in San Diego for two years, it was the strangest thing to me because I was coming out in New York City schools and I’m like, why am I walking a quarter mile to my next class? Like this is weird. Because they were all one story, you know, they were campuses.
PF It used to be, you would just go downstairs. Right?
RZ Just go downstairs. Exactly.
PF Here’s the thing. I think we sit here as New Yorkers and go, how come that didn’t happen here? And I think California doesn’t look at us that way. It goes how do they get to keep all the things? They can go to hell. We’re the empire. They would love to destroy us and it’s infuriating that they can’t. Whereas we are just essentially, the jealous King.
RZ I think geography is a funny thing too, right. New York City as a connection to the rest of Europe and the rest of the world is very meaningful as well. It’s just the beating heart of finance, globally, right. I mean, that’s New York City. And it is what it is. I think, look, I think the lesson learned here is both micro and macro. I think the lesson learned here on a micro level is get off your desk, take a walk, work has changed pretty drastically in the last couple of years. On a micro level, change your environment, change who you interact with, change what you’re reading. I’m trying to do that more but I ended up reading about Hitler again.
PF So a couple books for people to see if they’re curious. What the Dormouse Said by John Markoff. There’s a book called Dealers in Lightning which is about Xerox PARC. Alan Kay is spread everywhere, like Quora questions. Go on YouTube look up some Alan Kay. Here’s the thing. I think we keep trying to put the lightning back in the bottle. I think there’s a fantasy that we can get back there. It’s sort of like, it’s like the opposite of World War Two, right? Like just sort of bring it all home. You would never want it the things that led to World War Two to repeat, but you even can’t make that happened. We know what happened. We fight really hard to keep World War Two from happening again, I don’t think you can repeat something historic. And I think everybody’s just like, oh, well, innovation, right, we need to create an environment for more innovation. And I think in history, what you’re looking at is that a set of discoveries showed up around culture and technology equivalent to like, the Manhattan Project, which you don’t have unless there’s a war forcing it to occur. And but in the 20s, you also had a tremendous bloom of physics research, and you know, the Enlightenment in the 1700s. There are these sort of like, very key historical things that occur, that make it possible for those flourishing. But they’re also like, once they’re over, everybody’s always trying to get them back. And time has moved on. Like you just can you conceive of a world, right? Like, conceive of a world where there is no graphical user interface, you’re just playing, you have 100 users who are talking about this thing and interested in it. And it’s very, very expensive to operate, right? Like, what would that look like? It would look like a $300,000 worth of computer, it’d be you and me sitting here with 100 times more bandwidth and a petabyte of storage on our desktops. And what the hell would we do with that?
RZ I want to close this with a controversial question, but you only have a minute to answer it. And you’re not allowed to wrap the answer. You have to actually use full sentences. Ready? You talked about the explosion in the 20s. Around physics research, you talk about the explosion in the 70s, effectively around computing, are we on the cusp of a crypto explosion? Or did it explode already? I can’t tell.
PF Okay, crypto, I actually was writing with a friend about this the other day. I have a really funny filter with this, because you have to put market value aside. Okay, market value is very, very hypothetical. And my big question with crypto is can I make and do things with it easily? What can I do? And when we get a perfect crypto people, there’s often not a lot of follow through because they’re not in the making things. They’re kind of busy gambling. And there are tools that I think are conceptually really interesting, but they’re very, very expensive.
RZ Well, it reminds me about the 70s is tons of invention built upon invention in like such a rapid period of time. Right?
PF Exactly. And it is a mind virus in the same way. It’s like I think this is the future, what can we build with it? But what happens with that is I think what crypto it’s so much of it is more conceptually attractive than using it. Whereas I think with the early tech stuff, it actually was compelling because you could suddenly do word processing with fonts.
RZ It was fun!
PF It was. Remember that first Mac? You ever use the first Mac? My dad dropped me off somewhere when I was 10. It was a computer lab.
RZ You must’ve thought it was magic.
PF He let me use one of the Macs. It just was, you know, it was so little. It was really kind of for kids in a fun way. It was little and you got Mac paint up. Mac Paint was a majestic tool. In fact, Donald Knuth, the great computer scientist got really, I think he ended up advocating for the source code for Mac Paint to go into the computer history museums archives, because it was just such a special thing, all those little dots. So it’s this mind virus and it’s more attractive to think about it than to actually do the grisly work of product development. And I think over 20 or 30 years people are gonna figure it out. I think what’s weird is, you know, it took 30 years for computers to be worth collectively, you know, like a trillion dollars, for it to be the biggest possible industry. Blockchain on the other hand, just decided it would be worth–Blockchain techs are just a trillion dollars. That value never got created underneath.
RZ Right, right. I mean, which is kind of a cyclical sort of argument, because what they’re saying is–
PF We talk about the market cap of Blockchain and the market cap of different Blockchain based currencies, market cap of Bitcoin. So let’s say it’s a trillion dollars and it’s like, what is that multiple of earnings? Right?
RZ Hope. It’s a multiple have hope.
PF Yeah, hope. And I think there’s also an element of people going, you didn’t take care of me to the economy, you don’t care about what I’m interested in. So I’m opting out and I can and to hell with you and that is a very, that’s something humans do.
RZ You’re actually seeing this with, like struggling economies around the world like Venezuela and Lebanon, there’s a lot of conversation right now about using these alternative currencies, because the actual currencies failed them, failed the people.
PF Do I think it finds those niches. I think you’d get really hung up on classical economic questions like, what’s the store of value? And which are, you know, they’re valid. It’s good questions. But when enough people don’t care, and the money starts flying around, who cares? But I’m just sort of like, God, it’s got to be fast. Work on my phone. Like we have defined what consumer products lots of people like to use. And we go back and forth, and back and forth, and back and forth. But it’s like, no one should ever have to sell blockchain technology to me, it should be something that I’m so excited and motivated to use. And then I realize I’m participating in an economy by using it. There’s two elements. I think people who are into this are really into it. And it reminds me that way, they’re kind of like early web folks, and they just can’t believe that we haven’t gotten the memo yet. Rhey don’t care that it sucks because the source of community is so exciting and motivating.
RZ There’s a bit of that here. There’s a bit of that it’s a fervent–
PF It’s a scene.
RZ It’s a scene.
PF What crappy indie rock bands were to you and me. Cryptocurrencies are to people 15, 20 years younger. They’re in the scene. You buy into the scene.
RZ What I struggle with, though, is that for tech, you know, and I saw it all happen. I’ll never forget when I put my first graphics card, like a specialized 3d graphics card into my computer. It was like a miracle. They had to patch the games back then, because they weren’t designed for those graphics cards. And it was just amazing.
PF But boy, you’re walking around inside that little world.
RZ You’re walking around that little world and you know, Quake and Quake 2. And you watched it. So you watched a lot of it blossom. What I don’t see here, and maybe it’s because I don’t see it, is that the blossoming is just greater value. It’s just value. There is no 3d. There is no laser print. There’s no leap from dot matrix, there is no sort of this snowball effect of innovation that just translates into tangible benefit. Instead, it’s like, told you, it’s now $60, not 30.
PF This is an impossible conversation. Because if we’d been talking about the web 25 years ago, I would have been like, we have to check out this website, you know, like superbad.com, that’s a good website, you know, or go look at my blog. Yeah, everybody’s doing really important work. So I think they can say the same thing. The thing is, is like, I don’t care, I just don’t care.
RZ Well, here’s where I do care. When I see an ATM, that’s like Bitcoin, because the hell with it. Then I’m like, okay, wow, that’s crazy. He was spun up something tangible, this person’s gonna be able to buy milk with this money, right? Like, that’s real.
PF That’s a big deal.
RZ I can’t hear the rationalization and the justification to be look at the value now. That’s not enough. That can’t be the end game. You have to reduce friction around transactions, you have to make it easier, like the hard works ahead, right? For a lot of this stuff. And I don’t want this to shift into like a shitting on crypto thing. I think there’s something foundational and powerful there. But yeah, go ahead.
PF I get it. It’s a big fun toy, and it can make you a lot of money. And I can go play and learn. That’s great. Good. Okay. What I see as the next big thing is clearly climate. Like, clearly, they’re in the same space, really. Climate related digital stuff needs infrastructure. It needs incentives, it needs like a culture to grow around it, it needs craft, and it needs product and it doesn’t have a lot of those things. It’s not funded or structured or incentivized.
RZ A big nasty challenge ahead.
PF Blockchain is a self incentivizing platform, right. Like, if I do this, right, and I participate in a certain way, I will have more money. And you know, people will be like, well, you know, it’s not really about the money. It’s about the frickin money. Climate is the opposite. It’s like deincentivizing. Like the more you do, the more you realize you have to kind of shut the economy down. And so there’s a huge amount of work to be done. So, to me, I’m like, okay, what side do I choose? I feel that I have really learned and come to understand the technology industry. I do still love it. I think these tools are incredibly powerful. I will be writing Python code until I die. I will be using emacs until I die. I just, I love it. I love our world. It’s built wonderful relationships for me, what else are we going to do? And I think there’s kind of two paths. One is there’s this huge crisis that the tech industry could get very involved in and it is. I see it getting involved. All sorts of things are happening. And there’s this and then keep trying to put these two together. And to say AI and ML in the mix. Look, if you do this stuff day to day, and what you realize and with all that innovation, all that wonderful stuff stuff way, way back in the day, it’s a glob and grind in and out little by little. When you read the actual history of how they like, you know, installed Ethernet on the different machines and wired them up with they were at Xerox PARC, a guy came around with a screwdriver and wires. There’s all that stuff has to happen for the revolution to happen. We always forget that part.
RZ And it could still happen, right? It could still happen. We’re not saying it’s never going to. It’s just, it’s ahead. Not behind us. Like that’s my point.
PF Exactly. Look, people want the innovation without the guy with the screwdriver. That’s what everybody’s looking for. How do I get there without doing the work,
RZ Paul, you know, where else–you want to know another sort of counter argument to the innovation, the lack of innovation that happens in New York City? It’s a little tiny shop–I would call it an incubation–
PF God, they’re innovative.
RZ You want to incubate your project, your platform? Postlight at Postlight.com.
PF We’ll incubate the hell out of anything.
RZ Let’s not even joke about it. I mean, it’s an amazing group of product thinkers, strategists, designers, engineers.
PF Not too long ago, a very, very big organization came to us and said, We want you to solve a problem that we’ve been trying to solve for years. Can you design this app for us? And over three months, we did. Now it’s walking around at the very highest levels there and they’re excited to build it. So you know, you want to incubate in your large org and you want to spend a little money to just get it done, instead of having people say it can never happen. I will get you that prototype. Just send us an email.
RZ Well said, Paul.
PF What’s the email rich?
RZ Hello@postlight.com. And you can also check out our case studies at Postlight.com. Alright, everyone, have a great week.
PF Okay, bye!
[music ramps up, plays alone, ends]