The Ingenesist Project

The Next Economic Paradigm

Tag: future of money

Decentralized Integration of Complex Systems

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On December 8, 2014

In General Information

The recent Panel at The Future of Money and Technology Summit on Fueling the Decentralization Movement ended on a very interesting point: The Integration of Complex Systems.

The last comments from Chris Peel suggested that the iPhone program was more complex than Apollo and that we are a far way off from the ability to decentralize production to the degree that a space program or revolutionary consumer product would require. From my years in aviation, I am keenly aware that the complexities associated with an aircraft program would be extremely difficult and risky to manage with a series of autonomous agents and smart contracts – as we know them today.

Wisdom of Crowds

However, the proposition made by Joel Dietz at Swarm is significant. Swarm proposes to crowd-select, crowd-vet, and crowd-fund start-ups. Several efficiencies are cited:

1. The crowd knows best what is needed in a specific time and domain,

2. The same crowd is also the first user/customer/advocates of the product, and

3. The same crowd is the first to iterate the project.

Such diverse and comprehensive “single source” domain expertise is unlikely to be available from any Venture Capital Firm.  Instead, far too many start-ups are designed specifically for the Venture Capital process effectively inbred with the centralized DNA.  The VC formula is fairly simple, well documented, and contains suitably developed infrastructure. The VC process efficiently removes promising innovations from a decentralized ecosystem, repackages them, and injects them into the 20th century finance model of banks, brokers, and IPOs.

Today, the decentralization movement is portrayed in the media by silos like AirBnB and Uber, who may eventually expand into other markets (such as Amazon did from books), but from a relative monopoly position of acquisitions, scale, and market dominance – which is the antithesis of decentralization.

Fueling The Decentralization Movement

This Panel at Future of Money was selected in a very different manner.  The idea that I was trying to get at is that an ecosystem is like scaffolding being populated with individual applications. At first they are sparse, but soon they expand to depend upon each other. At first, each of the panelists seemed very different and related only by ideology. As the session progressed, we could see the each of the panelists were filling in the gaps between themselves soon appearing like a full stack.

Paige Peterson suggested that Maidsafe’s ideas and technology would solve specific problems in the crypto-space that the blockchain could not. Christian Peel suggested that Swarm and Maidsafe may reduce scale risk with what Ethereum has to offer. Sam Yilmaz at DApps Fund is betting on cryptoequity and a broad spectrum of “work proofs” as a means of holding these DApps together rather than letting them become disassembled by a single minded Venture Capital process. Of course, our interest at The Ingenesist Project is precisely on decentralizing both supply AND demand as a means of articulating intangible assets to society (ref: Coengineers.com and Curiosumé).

What is Cryptoequity?

“Cryptoequity,” as defined by Swarm (from this Source) is an umbrella term that covers various applications of cryptographic ledger offerings.

These can include:

(1) Product presales in which the token serves as a coupon redeemable for a real world good (i.e. the Comic Book sale done via Swarm)

(2) Product sales in which the token is redeemable for some service in a decentralized network (i.e. Storj or Ethereum)

(3) Product sales which serve as a “subscription” or membership to some decentralized network (i.e. Swarm)

(4) Token which serves as a license to use some type of intellectual property, potentially with an attached legal contract (i.e. sales being conducted in the Swarm 5th of November launch)

(5) “Shares” serving as stock equivalent for organizations that have no legal entity (i.e. BitShares)

(6) Shares serving as stock for legal entities (i.e. Overstock/Medici)

Efficiency in Zero Marginal Cost

The relative benefit of many of these is that it solves an interesting problem related to the near zero marginal cost of software distribution; the fixed scarcity of a good or service allows the market to determine the appropriate price point for a product rather than centralized forced scarcity or management selection.

Decentralized Integration of Complex Systems

If we are to ever reach a point where complex systems (such as space travel or consumer products – or even equitable governance, environmental stewardship, and fair wealth distribution)  can ever be achieved in a decentralized manner, we must start with the integration of decentralized applications among themselves in a decentralized way.  We should not exclusively extract and seal critical components off from an ecosystem and run them through the VC gamut – the disruption goes both ways.

 

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Future Of Money Part 2

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On November 27, 2014

In General Information

In 1801, Eli Whitney went before the US Congress with 10 working muskets. He proceeded to disassemble each of them, mix and scramble all the parts, then reassemble 10 muskets – all of them worked.  Prior to that day, most things were custom made by craftsmen using hand tools. Then, in a flash of geological time, the idea of interchangeable parts was released to the world – it would be impossible to put the idea back in its cage. Extraordinary levels of innovation followed as the industrial revolution was born.

In the murky world of crypto-currencies, the financial instruments of tomorrow may not necessarily be assembled like they are today. The new applications of decentralized currency are modeled more like “energy” flows rather than individual units of account. Energy exists in many forms such as electrical energy, chemical energy, thermodynamic energy, kinetic energy, nuclear energy, etc., but the objective is always the same, to move something in the physical world – to create change. The value of crypto-currency is proportional to the magnitude of change it can induce.

Future Of Money Part 2

A generalized theory is emerging to define and specify decentralized applications (DApps). This makes them easier to identify, measure, and replicate. If ignored, these innovations have the potential to be extremely disruptive to the insurance industry. If adapted, they can greatly increase the efficiency, variety, precision, and granularity for insurance products of tomorrow.

Not unlike the dawn of the industrial revolution, there is an extraordinary level of innovation in crypto-currencies since the inception of Bitcoin. The objective of these efforts is to move something in computational space such as flipping a switch, verifying a data set, securing identity, establishing order, establishing ownership, verifying capacity, etc.   This may seem somewhat obscure until you realize that these “energies” can convert and combine in immeasurable combinations to form autonomous logic circuits – i.e. complex contracts.

Since all businesses are based on contracts that act upon some physical space, it is only a matter of time before crypto-contracts jump to the physical space as well. As David Johnson, CEO of DApps Fund (a venture capital firm for decentralized innovation) says; “Everything that can be decentralized will be decentralized”. Eli Whitney was said to have uttered similar sentiments.

The early manifestations of this phenomenon are called Decentralized Application (DApps); these are little computational engines that operate autonomously and whose output is determined by an algorithm. The resulting decisions are binary and final. There are three characteristics that an application must have in order to be classified as a DApps. As you read these conditions, note how different they are from a traditional corporate structure.

  1. The application must be completely open-source, it must operate Autonomously, with no entity controlling the majority of its tokens, and its data and records of operation must be cryptographically stored in a public, decentralized block chain.
  2. The application must generate tokens according to a standard algorithm or set of criteria. These tokens must be necessary for the use of the application and any contribution from users should be rewarded by payment in the application’s tokens.
  3. The application may adapt its protocol in response to proposed improvements and market feedback but all changes must be decided by majority consensus of its users.

Next, there are three classes of Decentralized Applications that align loosely to a familiar computer analogy:

  • A Type I DApp is analogous to a computer operating system such as Windows or the Mac OS X, etc.
  • A Type II DApp is analogous to a general-purpose software program such as Word, Excel, or iPhoto.
  • A Type III DApp is analogous to a specialized software solution like a mail merge, or an expense macro, or a blogging platform.

As such, we can expect that there will be a fewest type I DApps, more type II DApps and even more type III DApps.

The more direct definition of these three classes is as follows: 

  • Type I decentralized applications has its own block chain. Bitcoin is the most famous example of a type I decentralized application but there are others. 
  • Type II decentralized applications use the block chain of a type I decentralized application. Type II decentralized applications are protocols and have tokens that are necessary for their function. 
  • Type III decentralized applications use the protocol of a type II decentralized application. For example: A hypothetical Cloud Protocol that uses a type II DApp to issue ‘cloudcoins’ that can be used to buy cloud computing services would be an example of a type III decentralized application.

Taken together we have most, if not all, of the familiar components of governance and interdependencies without the layers of management that are associated with traditional corporations. As you absorb the analogy and definitions, consider how DApps can be nested, combined, and integrated with other DApps to emulate complex contracts.

One particularly interesting DApp that recently launched is called Counterparty . Counterparty is a Type II DApp that performs one single task extremely well.

Counterparty is a betting platform; or we can put it politely and call it an escrow platform. Two parties may enter into an agreement about the outcome of a future event such as a horse race or football game. Each player puts his or her money into an escrow account that is sealed prior to the race. After the results are registered, the DApp autonomously transfers the money from the combined account to the winner.

Now imagine 500 bettors putting their money into the escrow account prior to the contract event. Upon completion of the event, the money is automatically assigned by algorithm to the winners in pre-assigned proportions. It does not take too much imagination to see this as an insurance product, except without agents, executives, managers, office towers or cute little geckos.

Soon, marathon runners can pool health insurance more towards sprains and falls, and less toward heart disease. Mini-van moms can pool auto insurance for number of passengers rather than miles driven. Professionals can pool E&O insurance by peer review. In fact, any affinity group can accurately price the perils that they are also most capable to manage.  DApps are massively scalable; one application can serve infinite users.

The market size of binary betting (sports, insurance, coin toss, etc.) combined with complex betting (contracts for difference, hedging, options, etc.) is in the trillions of dollars. So while Counterparty has only one use case, the use case is massive.  Now imagine 100,000 DApps operating autonomously, combining and integrating into complex relationships – not unlike building a jigsaw puzzle.

There was once a time when craftsmen guilds were the most powerful organization in the republic. Many of us remember the days when labor was increasingly replaced by machinery. The time may be arriving where machinery can also replace management. The insurance industry must become familiar with this environment and have the wherewithal to reorganize itself, before someone else does it for them.

***

Come Join us At The Future of Money and Technology Summit in San Francisco, December 2, 2014 for my panel discussion on Fueling the Decentralization Movement.

Speakers:

Paige Peterson – Maidsafe

Sam Onat Yilmaz – Dapps Fund

Joel Dietz – Swarm.co

Christian Peel – Ethereum

Moderator: Dan Robles, The Ingenesist Project

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A Practical Guide to The Big Flip

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On October 4, 2013

In General Information

We have an opportunity to propose a panel for one of the most important futurist financial summits in America, if not the World.  The Future Of Money and Technology Summit IV, brings together the brightest minds in financial technology innovation at the beautiful Hotel Kabuki in San Francisco.  This year’s event will be held December 9, 2013

***

Anyone can imagine the worst case scenario for economic collapse.  But we are interested in understanding the best case scenario for the diversification from fiat currency.  TIP loosely envisions a Big Flip; when so-called “intangibles” become the new “tangible”.

The Ingenesist Project is proposing the following panel for FOM&T

A Practical Guide to the Big Flip

The specter of economic calamity is rearing it’s ugly head once again, but for many, the end game came in 2008.  Innovators have spent the last 5 years developing new systems and methods to survive in a collaborative economy.  While community currencies are an excellent representation of material productivity, they are not readily convertible beyond small groups.  On the other hand, innovations such as Bitcoin are readily convertible globally, but are not necessarily backed by material human productivity. What if alternate economic systems used current or future generations of crypto currency to articulate community productivity? Could this combination finally solve the riddle of capitalization in non-fiat money?  Could this combination become the mother of all hedge funds during the Big Flip?  This panel will explore such frameworks for collaborative capitalism in the years to come. 

But We Need Your Help!!!

Please send us ideas about what new innovations have occurred since 2008 in response to the economic crisis – I’d like to mention them in the discussion.

Please send us ideas about what parts are still missing in order for an integrated alternate economy to emerge.

Please send us what innovations – if combined or in some way integrated – would serve a greater good than the sum of their parts.

Looking for fireworks.

There would be four panelists and myself as moderator. While we already have several people in mind, no commitments have been extended, so please also do let us know if you have anyone to suggest for this panel. We are looking for a MOST diverse group specifically targeting as many corners of the ideological spectrum as possible – in just 4 people. 

An amazing summiting experience

I have had the extraordinary opportunity of being invited to speak at FOM&T several times.  As a result, I have met some truly amazing people.  I have seen magnificent careers launched, international speaking opportunities arise, and we have found missing pieces in our own project – all at this magnificent event.  Many of my most trusted tech friends came from this conference. Of course, one relationship leads to another….and that is what is the Bg Flip is really all about.

THANK YOU!!

Please contact me through this site, or Twitter handle @ingenesist

 

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Growth Beats Austerity 100 to 1

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On May 15, 2012

In General Information

Bridge Over Troubled Water - by Cairn

Suppose a team of 10 engineers designs a bridge that spans a body of water connecting two small towns and cutting 1 hour off the alternate route for 14,000 people per day.  Over the 75-year life of that bridge, those 10 engineers are responsible for 380 Million hours of increased productivity.

At 25 dollars per hour per person whose time is saved, 10 engineers create nearly 10 billion dollars of NEW VALUE.  As such, only 100 engineers and a 10 bridges could create the same amount of New Value as Facebook is worth in an IPO.

Now compare the Old Value of the engineers.

Suppose that during the course of those same engineers’ careers, they could each borrow (capitalize) around 1 million dollars in personal debt for cars, homes, credit cards, and family education – debt that they would need in their lifetime.

By the miracles of the fractional reserve system, their 1 million dollars may be multiplied into 10 million dollars of new money available to the financial system for distribution.  As such, those same 100 engineers would be worth approximately 1 billion dollars as economic beings in the Old Value economy.

100:1 Ratio

So in review, 100 engineers are worth 100 billion in New Value versus only 1 Billion dollars in Old Value.  Of course, I purposely picked an example that would make the numbers come out all nice and orderly, but the most important point is that New Value leverages Old Value by several orders of magnitude.

Only two possible outcome of the global debt crisis.

1. The first is for all the countries of the world to get together and lop 3 zeros of the global accounts balance sheet and reboot.  As such; 40 Trillion dollars becomes a quaint and manageable 40 Billion dollars.  If it happens quickly, that’s called hyperinflation.  If it happens slowly, that is called Austerity.

2. The second outcome is currently raging in Europe today with austerity protests toppling governments in France and Greece with the idea of growth vs. austerity.  New candidates are promising to “grow” the economy out of its crisis.  While this may be a bold and populist idea that is sure to spread, nobody knows exactly how it will be implemented without triggering number 1.

The New Value Movement:

By making so called “intangibles” tangible, vast amounts of  New Value can be added to global accounts balances which could stave off wholesale collapse of the financial system.  This will not be without hardship for some people; social priorities must drive Wall Street priorities, not the other way around.

We don’t have a financial crisis, we have a value crisis.  One thing is emerging as a certainty, new value leverages old value by several orders of magnitude  and The Value Game provides the capitalist model to access this astonishing wealth creation  – in case anyone is wondering.

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New Value And The Future Of Money

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On April 25, 2012

In General Information

The 3rd Annual Future of Money and Technology Summit was held in San Francisco on April 23rd, 2012.  This was my 3rd appearance at the Summit and I must say that #3 was one of the most profound experiences that I have had a conference.  FOM&T is possibly one of the most important conferences of its kind.

Lunatic Fringe

Several years ago, many ideas that are now becoming mainstream were fringe topics at best.  At one time, the very idea that intangibles may in fact be immensely tangible, drew razor shards of broken glass from the KM community toward anyone who ventured toward such a claim.  Then, modern events such as Arab Spring and Occupy Wall Street demonstrated a direct challenge to very tangible “guns and money” brought by new ways of organizing communities around intangible assets.

The fringe questions of today become mainstream questions tomorrow

Now, what happens if we turn that concept into a means of producing the things that people really need instead of producing things that people don’t really need? What happens when people interact around a shared asset – either tangible or intangible – will they work to preserve the asset or consume it?  What if an economy arose where the Earth is the shared asset?  What if an economy arose where the individual was a shared asset? what if Both happened?  What would that look like?

A Value Game

The New Value Movement Panel came together around those ideas.  When I set this panel up, I created a value game – each of the people has something to gain from the success of the others on the panel.  This  panel shared an intangible asset in the form of a conversation.

The outcome was movement – a new value movement. Please watch this video and contact me with your thoughts – I am deeply interested in your interpretation of what happened here.
Thank you.

I hope to see you all at the next Future of Money and Technology Summit

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The New Value Movement

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On April 5, 2012

In General Information

It’s time once again for The Future of Money and Technology Summit in San Francisco on April 23, 2012.  Each year this community of visionaries dive deeper into the subject of alternate economics as the public narrative around the subject also increases.  This is truly an important event.  Please register here.

In full disclosure, the producers of FOM&T trusted me to assemble this panel to advance a theme that was initiated at Sibos Innotribe Sessions (Toronto 2011).  I elected to NOT appoint myself moderator – Dr. V is much more experienced in that role.   Instead, I will attempt to speak for the Ingenesist.  The word ingenesist is derived from the Latin word for engineer – an ingenesist is any person who creates real value through their social, creative, and intellectual abilities. For this reason, the panel is titled:

The New Value Movement

Past panels in this segment at FOM&T included discussions about non-quantifyable exchanges and intangible capital.  This panel introduces the New Value Movement where emergent ideas and associated web applications seek to allow non-quantifiable exchanges to become “quantifiable” and Intangible Capital to become “tangible”.

Like the Beatles once sang “Money Can’t Buy Me Love”, New Value refers to those things that cannot necessarily be produced through the allocation of classical factors such as land, labor, and capital. Rather, the next generation of entrepreneurs will allocate resources of social capital, creative capital, and intellectual capital in order to produce the things that society needs.

Innovations such as trust networks, knowledge inventories, social games, and abundance capitalism will become increasingly important and hold great promise for hedging the inevitable constraints on fiat currency.

Dr. Amy Vanderbilt – moderator

Dr. V is the Founder and Chief Strategist at TrendPOV.com, next generation social omni-media that over 600 thousand executives call GPS for your business strategy.  Amy is an award-winning author, show host, executive coach, speaker, board member, and  commentator. She has distinguished herself in academia, private and public industry as well as government. (full bio here)

Patrick Murck

Speaking to the existing legal structures and foundations that would support the storage and exchange of New Value Enterprise is Patrick Murck.  Patrick is a Principal and Founder of Engage Strategy and Engage Legal.  Patrick helps clients innovate, operate and grow their business with a heightened focus on the legal and regulatory issues governing the use of virtual economies, gamification, alternative payment systems, and social loyalty and reward programs. (full bio here)

Joe Johnson

Speaking to the emergence of a new class of business methods is Joe Johnson, CEO and head coder of runaway startup called Connect.me.  Connect.Me is a new reputation and people discovery network creating a consolidated platform for social verification and trust in P2P and freelance economies. In 2011, Connect.Me won the prestigious Privacy Award from the European Identity Conference for its groundbreaking trust framework and business model. (full bio here)

My Role:

In Amy’s world of executives consulting, the ingenesist includes the designer new products.  In Patricks world, the ingenesist may be an innovator from Anytown USA trying to navigate the intricacies of law, money, and finance.  In Joe’s world, the ingenesist is the cloud of specialized skill holders looking for each other to create value together.  I often argue that all value not created directly by Mother Nature, was created by the ingenesist within all of us.

Please join us as Dr. Vanderbilt skillfully weaves the ideas, needs, and predictions of this extraordinary combination of panelists into a unique and more complete view of the great opportunities that await on the horizon of this unprecedented financial revolution.   
***
The Future of Money & Technology Summit brings together the best and brightest thinkers around money, including visionaries, entrepreneurial business people, developers, press, investors, authors, solution providers, service providers, and organizations who work with them at the convergence of cash and commerce. We meet to discuss the evolving money ecosystem in a proactive, conducive to dealmaking environment.
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A Radical Twist on Crowd Computing

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On September 13, 2011

In General Information

Social Flights is a Value Game. The objective is for communities to fill a private jet in both directions in order to achieve the best economics. This may be achieved through creative Game Mechanics where travelers, aircraft operators, tourism and hospitality vendors, and municipalities interact in their mutual best interest to perform a calculation in a radical twist on the concept of Crowd Computing.

But what if communities could organize themselves using their own data? This would introduce a great deal of innovation in order to solve a calculation that is otherwise performed by capital infrastructure such as structures, corporations, government, or in the case of Social Flights, a vast hub airport.

The Value Game is designed to be gamed by entrepreneurs where “True Value” is created through collaboration rather than competition.  

If Social Flights can create a game where people share an airplanes, imagine that the same game can be played with any shared asset from cars, education, health care, food production, and even public infrastructure.  Communities may perform the “calculations of economics” much like how traditional tribes allocate resources.  Enterprise lacking in “socially redeeming value”,  by definition, will fail.

So exactly how powerful are tribes?

As we all seen this year alone in the Internet Age, Social Currency can and does directly challenge dictators, militaries, financial systems, and governments across the globe.  People are performing Crowd Calculations – communities are Crowd Computing.  These ideas and many more will be highlighted by Innotribe at SIBOS 2011

Let me offer an analogy:      

The economy that is denominated by Money, is a system built on 5 pillars that are perform the calculations of finance and economics.  The pillars are integrated to support a financial system. These pillars are: a currency, an accounting system, vetting institutions, entrepreneurs, and consumers.

If any one of these pillars is broken, corrupted, oppressed or otherwise fails, the entire system falters. Enron presented a failure in the accounting profession. The mortgage crisis was the failure of the vetting mechanisms. Corrupt legal systems suppress entrepreneurs. Now the debt crisis is threatening the currency pillar.  The currency crisis will threaten the consumer.

Suppose that these five old economic pillars could be duplicated in a some different way and then integrated to form an alternate system for performing the same calculations.   It is no coincidence that many of the sessions at SIBOS2011/Innotribe correspond to the five pillars of such an economy.

Entrepreneurs: Social Data and Cooperation, Corporate Cultures 

Vetting mechanisms:  Banks for a better world

Accounting system; Big Data

Consumers: Digital Identity

Currency; Future of Money

Imagine this, if the organizations at Innotribe were to integrate to create a new economy that is only slightly more efficient the old system, they may become the mother of all hedge funds. Remember the dictator caught without social currency?  At least half the money in the world will convert, capitalize, and securitize in social currency.  We may not be that far off from that day.

The New Economies Track at SIBOS2011/Innotribe features the people and projects that are at the forefront of “The Big Integration” where the five pillars of a new economic system will integrate themselves to form a new economy to replace the old.  It all starts with entrepreneurs such as those featured at Innotribe 2011 trying to figure out new ways to integrate the five pillars of a new economy.

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New Economies at SIBOS; The Metacurrency Project

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On September 2, 2011

In General Information

The New Economies Panel at SIBOS Innotribe this year in Toronto represents the most important elements of a new economy which many people believe is emerging to replace the old one that continues to crumble around us.

The common message of New Economy movement is the vastly expanded definition for the term “Value’ – far beyond that which can be articulated with money.  Very few organizations hold this idea as explicit to their DNA as The Metacurrency Project.

Few can deny that the Sun delivers all value to our Earth.  The Mass of our Universe provides the rest; Gravity, Motion, and time.  In this context, money is a trivial device that simply articulates the relatively archaic things that humans can manage to conjure and horde from the vast natural resources that are delivered to us for free.

The idea that Energy can exist is many forms cannot be separated from the fact that Value can and must also exist in many forms.  The challenge that we face as a civilization is to build an economy that articulates all Value completely and truthfully.

The Metacurrency Project has become a Worldwide conversation expanding the definition of value and building systems to articulate such value in communities, companies, and society.

I had the opportunity to meet Art Brock at The Future of Money and Technology Summit in San Francisco earlier this year.  Art represents a very important voice in the discussion of new economies at SIBOS/Innotribe on September 19-23 in Toronto.

We look forward to seeing you in Toronto.  If not, then thank you for continued interest and participation in the important subject of New Economies.

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The Future Of Money And Technology; Monetizing Intangible Capital

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On March 30, 2011

In General Information

The following video series was recorded at the Future Of Money and Technology Summit in San Francisco on February 28, 2011. The name of this panel is Monetizing Intangible Capital. The speakers are Mary Adams (moderator), Art Brock, Greg Wendt, and myself. All six parts are posted below (8-10 minutes each) for public distribution, comments, and review.

I found this panel to be extremely interesting and especially valuable since these panelists represents an important cross section of professionals who are actually doing the hard work of designing, testing, developing, and producing specifications for the creation, storage, and exchange of what could represent a large percentage of the value in our global economy.  This discussion is not insignificant by any measure.

Mary Adams opened the panel with a remarkable statistic that 80% of our economy exists in the form of intangibles that do not necessarily show up in the balance sheet of the global economy – which is notably in crisis at this time.   Mary offers a working definition of Intangible Capital as consisting of 3 primary components: Intellectual Capital (the stuff between people’s ears), Relationship Capital (degrees of connectedness to a social network), and Structural Capital (tools, processes, and data).   Then, Mary adds a fourth category called Strategic Capital which includes planning, formulation, and scenario testing.

Mary then brilliantly guides the audience and the panel through 50+ minutes of high quality interaction addressing some of the most pressing issues of our time from the uprising in the Middle East, to Healthcare, Global Warming, Organic Food Production, and even the Internet Kill Switch – all these subjects become interconnected and relevant in this domain.

Art Brock introduces a set of very important ideas about how there is a vast amounts of “Value” that is not, and many never be, adequately articulated by a “monetary” system that exists today.  It is therefore necessary to capture value in a completely different manner involving higher forms of expression which, in turn, introduce a new “value system” that would better represents social priorities and the fair distribution of resources and associated wealth.

Greg Wendt introduces his work related to articulating the planet Earth as the “Meta Economy” under which the financial economy is merely a subset.  When accounted in this manner, humans are spending beyond our planet’s means to replace resources consumed.  As such, we cannot expect to arrive at a “Balanced Budget” by anyone’s definition unless we include a full accounting of Earth’s productivity.

I, myself (representing The Ingenesist project) suggest that there is a small flaw in market economics that can be corrected where the factors of production include a “knowledge inventory” rather that a material inventory of land, parts, and simple labor.  Such a knowledge inventory, if articulated in the correct format, can act as the basis of a social currency that may compete admirably with, if not fully replace, a vulnerable dollar based economy.

I was deeply impressed at how four highly recognized experts can approach a similar problem from four completely different directions and environments yet arrive at fully complementary set conclusions and subsequent solutions.  I encourage the viewer to watch the entire series as this is truly a rare meeting of minds.

Monetizing Intangible Capital Part 1/6

Monetizing Intangible Capital Part 2/6

Monetizing Intangible Capital Part 3/6

Monetizing Intangible Capital Part 4/6

Monetizing Intangible Capital Part 5/6

Monetizing Intangible Capital Part 6/6

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The Value Game Plays The Valley Game

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On February 26, 2011

In General Information

(The following is a draft of the unveiling presentation for The Value Game at The Future of Money and Technology Summit in San Francisco on February 28th 2011)

Hello;

The Ingenesist Project is developing a new class of business methods that convert social value into financial value, and vice versa.  The premise is that when people cooperate to do useful things, they can also create an amazing amount of social value.

Historically, we have seen how each of the great eras of human civilization was derived from the prior era when the tools of that prior era became integrated.  Like when the wheel, wedge, and pulley integrated to become the printing press.  Great social transformation followed.

So it is that integration of tools that we are most interested in.

Today, we can see this drama playing out across the Globe as people integrate the tools that were created over the last 30 years. People are reorganizing and in doing so they are directly challenging the power of financial currency with equally powerful social currency.

So it is inevitable that a conversion factor between social currency and financial currency will arise.  And that, we believe, will mark the next economic era.

So we developed something called The Value Game that we believe will help build the social infrastructure for the creation, storage, and exchange of social value.

The Value Game is a new class of business methods designed to specifically create social value.  The rules of the Value Game are very simple.  The Game Starts and Ends with money but all of the new value created in the game is denominated in Social Currency.

A Value Game is created by assembling 3 or more communities around a single shared asset in such a way that their interaction with each other relative to the asset creates social value.  In this form, social value can then be more readily converted to a financial value.

To demonstrate this, we helped launch a new company called Social Flights.  The objectives of Social Flights are to aggregate a large fleet of Private Turbine powered Aircraft and deploy them to the Social Graph instead of the Hub and Spoke system used by the Commercial Airlines.

The Shared Asset is the jet.  Player 1 is the traveler community.  Player 2 is the community of private aircraft operators. ,  Player 3 is the community of entrepreneurs at the flight destination.  The True Value Calculation compares the true door-to-door cost of using Social Flights versus other alternatives such as commercial airlines.

For example, flying between two smaller cities like Bellingham Washington and Vail, Colorado.  A Commercial flight would take close to 14 hours traveling through two hubs.  A fully utilized private flight would cost about twice as much but can make the flight in 3 hours.  So right off the bat, the True Value Calculation issues a par value between alternatives.  So if your time is worth less than, say, 70 dollars per hour, you are better off taking commercial airlines.  But if your time is worth more than 70 dollars per hour – for whatever reason – then you should take the private flight.

Now, a hotel in Vail may say – wow, here is a group of 10 people staying 5 days. They can divert advertising budget and issue a 100 dollar “discount coupon” to everyone in the group. Now the par value of the private flight is reduced to 60 dollars per hour. Next, Ski slopes, restaurants, bars, and services will deploy Coupons against the airplane lowering the par value toward closer to middle class incomes and certainly well within the business class of a commercial airline.

Things will get really interesting as people start gaming the game. The more demographic information that the traveler provides, the greater the likelihood that more and more vendors will issue them a discount coupon – which they can even resell on Craigslist.

In effect, why would someone let Facebook sell their information when people can sell it their selves?  Why would vendors pay for advertising when they can find the perfect customers directly?  Why would a manufacturer pay a retailer when the community can sell it for them?   Here we see a great deal of financial value can also be articulated in a Value Game.

Theoretically, we could build a Value Game around any shared asset from zip cars, public infrastructure, energy production, education, natural resources, even the totality of human knowledge, etc.

But for now, let me introduce Allen Howell, Chairman of Social Flights who will discuss how this new business method is developing in practice.

Social Flights should be very interesting to many of the people here because it integrates several of the hottest properties in the Valley; Travel, Coupons, Gaming, and Social Media.  Each of these communities have seen astonishing valuations lately so it will be interesting to see what happens when they, in fact, become integrated.

So please welcome Allen and I can take questions while he sets up.

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The Future Of Money And Technology Summit 2011

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On January 26, 2011

In General Information

In my opinion, The Future of Money and Technology Summit is among the most important conferences in America.  FOM&T is not the usual parade of polished celebrities selling books, consulting, or seminars.  Here you’ll find the people who work deep in the caldron of innovation enterprise bringing together some of the most important ideas in the world today.

The Moment is now

The challenges for the future are immense, the technologies unfolding before us are extraordinary, and the people on the front lines are visionaries.  For better or worse, future generations will look back on several key moments that marked the beginning of a new era.

Last year I was deeply humbled by the quantity, quality and razor sharp intellect from the audience and the speaking panels alike.  The panels were great, but the audience was just as awesome.  Every question asked of the panelists was as profound and inspired as the panelists themselves.   One common thread binds this conference like no other that I’ve attended:  we’re all in it together. I consider myself privileged to be a participant in this event.

A Portrait of The Future

For me it seemed like 800 pieces to a huge jigsaw puzzle walking around finding their place in a yet unknown portrait of the future.   Everyone has part of the answer and nobody has all the answers – this makes for an extraordinary collaborative learning environment and likely the best place to peer deep into the future.

I strongly recommend that anyone who engages in this conversation of the ‘future of money and technology’ in their work, research, blog, or start-up must attend this historic event.  This is truly an example that the whole is far greater than the sum of the parts, and there are some great parts!

Fight your reservations with your reservation

The Future of Money and Technology Summit will be held on February 28th 2011 at the beautiful Hotel Kabuki at 1625 Post Street, San Francisco, CA.  More details can be found here.

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The “New Value” Integration Begins

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On January 24, 2011

In General Information

The New Integration begins; Travel, Coupons, Gaming, and Currency

Each stage of humanity’s social evolution did not replace the prior social order; rather, it integrated the tools created during the prior social order. The agrarian economy is going strong and feeding the world. The industrial revolution integrated the tools of the scientific revolution – both still exist.  The knowledge economy integrates the tools of the information age as we speak. The next economic paradigm will result from the integration of tools developed from the technologies of the knowledge economy. So what’s happening out there now?

Travel: Nothing economic can happen until people get together an build something.

Tripit acquired for 120M, DoJ Mulls anti-trust suit for purchase of ITA, Travel sites gang up against ITA Sale, American, Expedia, Orbitz in 3-way dispute, Facebook buys Nextstop,

Coupons: Hey, who exactly is subsidizing all that discount value?

2 y.o. Groupon rejects 6B offer, mulls IPO.  50 top Groupon Copy cats, “Google Offers” Groupon Competitor, Groupon Bachlash builds, Foursquare and Groupon go after “Local Social”

Games: A business as old as money.

Zynga valued at up to 5B. Zynga goes on a buying spree (8 acquisitions in 8 months); Google buying spree in mobile gaming and invests 100M in Zynga,  8B in virtual goods sold worldwide – china leads. Facebook Credits become mandatory for games.

Currency: storage and exchange of social value.

Google buys Social Gold for 75M – social gaming/virtual currency platform. Alternate Currency Movement gains popularity,  Zeitgeist Movement goes on the defensive.  Symbionomics to organize the “new value” conversation. Facebook rolls out new currency. AMEX launches “social currency” with “geolocation”……..

Bringing us back to the beginning: Travel:,  

Unveiling The Catalyst

The Value Game developed by The Ingenesist Project will be unveiled at The Future of Money and Technology Summit on February 28th 2011. We will demonstrate how a high value asset such as an aircraft, zipcar, renewable power, or even public infrastructure can be massively leveraged to create New Social Value.  This represents a new class of business methods designed to integrate the tools of the knowledge economy and produce a closed-loop prototypical innovation economy.

Leveraging fixed assets, socially

The Value Game uses the example of how entrepreneurs can leverage an under utilized asset such as a corporate jet fleet and match routes to the Geographic Social Graph at small airport (Travel) instead of competing with an inefficient Commercial Airline model.  Vendors could join social networks to subsidize airfares with contingency (Coupons) for related products and services. A true value calculator would compare door-to-door social value of private travel with the financial value proposition of commercial airlines.  This comparison creates a conversion factor between social currency and financial (Currency) which monetizes social value.  The resulting interactions between traveler, vendor, and 3rd party entrepreneurs creates an “Intentions Game” in social media where it is in everyone’s best interest to create social value and deploy it to the (Game).

The game starts and ends with money, but all the “New Value” is created inside the game and denominated in social currencies. Entrepreneurs will game the game, the planes will get bigger, the coupons will get stronger, and the social currency will out-perform the financial currency in new value creation.  This business method is now being tested in a live venture. What we learn from this may help catalyze a new and more sustainable economic model called Social Capitalism.

Don’t miss this historic unveiling at The Future of Money and Technology Summit on February 28, 2011

***

(Editors note: The above post is #1 in a series [1], [2], [3], [4], [5] introducing The Value Game to a new class of business methods.  The first real world application is Social Flights; a collaborative production / consumption game being deployed to the market.  If this works, the new business method class will be generalized throughout the economy to catalyze the convertibility of social currency.)

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A Tale As Old As Time

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On November 8, 2010

In General Information

by animeartist67

Nothing grabs people’s attention these days like a discussion about the future of money.  Yet few subjects diverge as wildly. The stakes are high since personal and political fortunes are cast against the ideals of what money is, what it has been, and what it will become.  The temptation to cast the future of money in one’s own image is a tale as old as time and likely the source of most social conflict.

The Future of Time

There are two futures of money being foretold today. One is predicated on the demise of Capitalism and persistent denial that scarcity is a real economic element, despite the obvious scarcity of time in one’s life, for instance. The other future seeks to correct the flaw in Market Capitalism so that one’s scarce time may become more equitably allocated and less easily exploited by others.  Social values such as freedom, liberty, family, community, trust, health and welfare are derived from how one is allowed to prioritizes their own time, not how one is able to prioritizes the time of others.

The United States of Mind

The reason why this distinction is important is that no great economic paradigm of human civilization ever came about as a result of wholesale collapse of the prior economic paradigm. Rather, each new state of human social organization was derived from the prior state through an integration of tools created in that prior state.

It is now time to take account of these tools and figure out how to integrate them correctly.  This is the only way to foresee where we need to go and how we can get there.  The only way to defeat gravity is to understand gravity. The work will be difficult, it will be scientific, it will be intellectually challenging, and it will be inclusive of all living systems – including those that we seek to change. The trick to the future of money business will be to cure the disease without killing the patient.

Unfortunately, we may not have much time

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The Social Value Index

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On November 2, 2010

In General Information

The Big Mac Index is published by The Economist as an informal way of measuring the purchasing power parity (PPP) between two currencies and provides a test of the extent to which market exchange rates result in goods costing the same in different countries.  UBS Wealth Management Research has expanded the idea of the Big Mac index to include the amount of time that an average worker in a given country must work to earn enough to buy a Big Mac.

Time is the true scarcity

Everyone is allotted a certain amount of time before they must leave the game and how they choose to allocate their time defines how they stand in the economy playing out before us.   People may store, exchange, borrow and give their time to others.  People can also steal, exploit, and waste the time of others.  Likewise, the greatest innovations are those that create time and the greatest scourges of our civilization are those that kill time.

Social Value Index

There are many indices that help us to track comparative values. These include the Dow Jones Industrial Average and the S&P 500, etc. People track them over time to help define productivity. Productivity (you and I going to work everyday) is what gives the dollar it’s value, not the other way around. Likewise, the Social Value Index will compare the financial profit (or loss) of a product or service with the social profit (or loss) of that product with respect to time.

Future of Money

The future of money will most likely arise from entrepreneurs influencing the social value index with thousands of new business models rather than the creation of some new independent currency.  The ratio between financial currency and social currency may in fact become that “new currency” standard.  As the dollar loses it’s steam, the social currency will gain steam and the Social Value Index will rise (not unlike like the S&P 500 index since 1945) to reflect a measure of social economic growth; i.e., abundant social factors of production will define productivity instead of scarcity of land, Labor, and Capital.

The trick is to cure the cancer without killing the patient

A new social currency will be born from the slow and steady evaporation of the old debt as the dollar atrophies, rather than the wholesale demise of Capitalism. As such, the Social Currency will become increasingly biased toward social priorities instead of Wall Street priorities and the pesky little flaw in Market Capitalism will correct itself.  This is the primordial soup from which ideals such as the environment, renewable energy, wealth disparity, education, etc., will become highly profitable social enterprise.  This can be achieved quickly and cheaply with existing technology if we index the data correctly; that is, with respect to time.

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To Accelerate Serendipity, The Whuffie Factor

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On May 13, 2010

In General Information

Tara Hunt; Future of Money and Technology Summit 2010

In 1999, Cluetrain Manifesto flipped everything we knew about online behavior on it’s head. The integration of information being published on the Internet reached a tipping point indelibly articulated for all time by Doc Searles: “Markets are Conversations”

The Whuffie

In 2003, Cory Doctorow published Down and Out In The Magic Kingdom where he introduced the concept of Whuffie as a form of reputation currency that accounts for social value in a fictional future society. In Cory’s thesis, people who produce things that represent social value were awarded Whuffie. People who produce anti-social value were punished Whuffie. The twist was that everyone has equal say as to who is awarded Whuffie and who is punished Whuffie. In retrospect, the concept of Whuffie, stands today an important metaphor marking the beginning of the social media revolution.

The Whuffie Factor

In her book The Whuffie Factor (2009), Tara Hunt identifies the facts of a reputation backed exchange among real people, communities, companies, and social interactions – with all their associated human complexities. By the gift of wisdom or intuition, Tara’s choice of the modifier “Factor” is an important distinction. In mathematics, a “Factor” is a multiplier against some other quantity.

Social Capital

In Tara’s book, Whuffie is roughly synonymous with ‘new’ social capital – a hugely complex financial instrument that is currently emerging before the eyes of all practitioners of social media. In 2010, everyone still struggles to articulate social capital with a 1999 vocabulary of new conversations living in old financial markets. There simply is no word for the phenomenon of social media daily manifesting in so many new and valuable ways – it’s just too new.

Yes, Tara has critics, but most I believe are short sighted. The term “Whuffie” is as good a word as any, so deal with it. The term “Factor” is what Tara is really talking about, so lets move on.

Love ’em or Hate ’em, Whuffie is a Derivative.

From Wikipedia: a derivative is any agreement or contract that is not based on a real, or true, exchange ie: There is nothing tangible like money, or a product, that is being exchanged. For example, a person goes to the grocery store, exchanges a currency (money) for a commodity (say, an apple). The exchange is complete when both parties have something tangible.

If the purchaser had called the store and asked for the apple to be held for one hour while the purchaser drives to the store, and the seller agrees, then a derivative has been created. The agreement (derivative) is derived from a proposed exchange (trade money for apple in one hour, not now).

Infinite Possibilities

In short, the current value of the relationship is backed by the past and future value of the many other relationship(s) formed. The twist is that social media has vastly equalized people’s impact on the true value of relationships – this remains consistent with Doctorow’s thesis. Tara takes us a step further where the underlying asset can be generalized as simply “value” where the Whuffie Factor is a derivative against this value. This is consistent with Searles’ thesis.

Social Currency

In my opinion, The Whuffie Factor will become one of the seminal books of its time period. Indeed there are many excellent books in the genre of collecting, building, engaging, storing and exchanging trust, reputation, or influence in Social Media. What sets Tara’s book apart is that, like Doc and Cory, she had the guts to call it something real.

Elevate the conversation or get out of the way

Tara Hunt effectively nails this profound abstraction to the floor so that the rest of us can now walk through to define and articulate the Holy Grail of our generation; a true Social Currency. Bravo Tara, Bravo

To Accelerate Serendipity, that’s the Whuffie Factor.

Photo Source/Credit; Jesse Lara

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Who Is Quantified by Whom?

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On May 3, 2010

In General Information

What is a Non-quantifiable Exchange?

The term “Non-Quantifiable Exchanges” was the title of a panel session that I attended at the recent Future of Money and Technology Summit. In researching the subject, it appears that a “non-quantifiable exchange” is more notable for what it is not rather than what it is. Case in point – after the precursory Google Search, the term and a modern definition does not exist – but the room was full !?!?!

With all of the talk about cloud sourcing economies and romantic notions of emerging organic currencies, it would seems that people could just get along fine without a central mechanism for storage and exchange of value. Instead, each individual would assess the value of the transaction in terms of what it means to him or her. Currency could then take the form of a person’s reputation, productivity and general usefulness for assessing value and helping others to do so in their community (reference)

If it’s not an asset…or a liability, then what is it?

Traditional valuation systems for businesses immediately start tugging at a host of standard assumptions for measuring “performance” – many of which are no longer meaningful. Land, Labor, and capital cannot be deployed to the same efficacy whereas social capital, creative capital, and intellectual capital are being liberated to social media with astonishing results.

Nobody can produce an accurate ROI for social media, however, social media presence is becoming a substantial factor in the valuation of a company.

Likewise, reverse access to personal information about customers on Facebook is both the lifeblood and poison of new engagement marketing. The general public have become “external intangibles” to the business plan – where the heck is that on a balance sheet?

Goldman Sachs claims that those who bought their worst subprime products were sophisticated investors whose obligation it is to understand the quality of the underlying components. Their defense is that the customer failed, not the system of disclosure.…what? How long would Dell last if this had been their response for poor quality?

Cloud Economics or Inversion System?

Vapor is quantified by the balloon that contains it. A cloud is quantified by the weather system that surrounds it. The atmosphere is quantified by the mass of the planet and it’s proximity to a sun, and so on. Therefore, the term “non-quantifiable”, and the word “exchange”, are mutually exclusive. If there is an exchange, there is quantification.

Suppose I was to suggest that value stored in social currency may exceed the value stored by financial currency. The paradigm shift now becomes, who quantifies whom?

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Community Currency; Ithaca Hours

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On November 6, 2009

In General Information

Editor’s note: I found this copyrighted piece from all the way back in 1995.  I find such history enlightening.  As a researcher it allows me to eliminate certain variables such as Social Media, 9/11, TARP, GWB, BHO, Global Warming, and a host of other firebrand influences on public opinion and action.  That said, the clarity is remarkable. Take strong note of the intention of fulfilling social priorities.  Today, as our corporations and government (federal, state, and local) continue to cut social programs in order to service interest on debt, the void on social programs will induce an inevitable condition; Community Conversational Currency.

by Paul Glover

Originally published in IN CONTEXT #41, Summer 1995, Page 30
Copyright (c)1995, 1997 by Context Institute

Many communities are giving up waiting on large corporations or government to invest or provide jobs, and are instead building on their own strengths and resources.

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