Tim O’Reilly

Tim O’Reilly (@TimOReilly) joined Jason Calacanis (@Jason) on the TWIST podcast to talk about imitation, the new economy, and ecosystems. The conversation was entertaining and far ranging. Like a city with hidden gems tucked into alleys, this conversation had similar pockets. We won’t get to any of that. There were 3 major themes to this conversation and our table of contents looks like this:

– Imitation and Inspiration.

– New Jobs for a New Economy.

– Ecosystems.

Imitation and Inspiration.

Imitation should not be looked down on, especially when you begin something. In fact, imitation may be mandatory. Stephen King writes:

“Stylistic imitation is one thing, a perfectly honorable way to get started as a writer (and impossible to avoid, really; some sort of imitation marks each new stage of a writer’s development), but one cannot imitate a writer’s approach to a particular genre, no matter how simple what that writer is doing may seem. You can’t aim a book like a cruise missile, in other other words.”

King goes on to say that his own early writings went through phases depending on what he had been reading. Ben Mezrich said that he had an imitation incubation. Not until Mezrich wrote in his own voice, was he successful. Austin Kleon wrote, “the whole point in Steal Like an Artist is that you don’t shut yourself down to influence and try to be wholly original. You actually open up the gates and embrace influence.”

Imitation is like following a path through the woods. It’s how you get your hiking legs. The path is worn and doesn’t require knowing what poison ivy looks like or what a bear sounds like. As you progress, as you learn, and take deeper trips you can forge your own paths. That’s what Calacanis did.

“I copied everything you did coming up,” he tells O’Reilly. “You’re my inspiration for a lot of what I do.”

Of course we’ll branch off. Imitation will inspire us to do new things. Conferences were not new when O’Reilly began. What was new was the way he put things together that people didn’t understand. What do artificial intelligence, algorithms, and Uber have to do with each other? Well, says O’Reilly, that’s what we should figure out.

Thinking forward makes sense. Naval Ravikant said that great inventions are always unrecognized. Kevin Kelly said that things we’ll use in 25 years haven’t even been created yet.

How does this thinking apply to jobs?

New Jobs for a New Economy.

The idea for changing jobs has bubbled up a lot lately. Adam Davidson talked about The Hollywood Model. Taylor Pearson wrote about it in The End of Jobs. Naval Ravikant said he imagined people will someday wake up and swipe left or right for work. Tim O’Reilly has seen this in action. Employees want to work for two months and then vanish for a month, he tells Calacanis. Jason adds this is good because, “people who pick their down hours will be happier.”

This reminds me of the idea that David Heinemeier Hansson shares. Hansson – co founder of Basecamp – says that he always prefers projects that he’s motivated to do. That motivation will make the work that much better and it will (net net) be the better choice. This sort of shift is worth it said Scott Galloway, “millennials are the most talented generation I have ever worked with.”

The new employment landscape is a la carte style situation where employees choose when and how much to work and that their motivation and skills makes up for the time they don’t spend “in the office.”

But there’s more than that. “We have to dignify new kinds of things as work, because people do get self-esteem from work,” O’Reilly says. In the same way we view social media artists (Nicholas Megalis), we should view parents, teachers, and service workers.

If O’Reilly’s micro point is, this is how work will be different (swipe right). Then O’Reilly’s macro point is this; it needs to be fair for everyone. “It’s a good job if you can get it,” goes the axiom but not everyone can get it.

It’s good that people with technical skills are equipped for the new economy. What isn’t good is the situation that less skilled employees face. “People taking bigger and bigger shares of the (financial) pie and that worries me,” O’Reilly says.

In his post, Workers in a World of Continuous Partial Employment, O’Reilly notes that there needs to be a new system for work. Right now companies like, The Gap and McDonald’s, use algorithms to determine when employees are needed, when they aren’t, and when they get close to 29 hours. That mark is important, because it’s when additional benefits like health care kick in and makes workers more expensive.

But the “gig” economy isn’t a perfect solution. It’s great that Uber drivers can supplement their income, but the algorithm their work condition has flaws too. Those workers miss out on the security of workman’s comp and other labor laws. We have two extremes, but the best option O’Reilly suggests, is in the middle.

His solution is a third type of work structure with new rules, regulations, and safety nets. It sits on a stool of technology that already exists. Companies like The Gap and McDonald’s use third party billing software that tracks hours worked. Uber uses software that determines how long someone drives. Combine this data O’Reilly says, to create a picture of how much someone works.

This may sound like a lot of Silicon Valley rose colored lens ideas, and that’s what O’Reilly is working to clarify. “I want to help companies understand that this isn’t just a bunch of crazy companies in Silicon Valley that are doing things they don’t understand.”

It’s starting to seep in. Scott Galloway said that he sees companies like Uber and Instacart creating opportunities for other business to create last mile solutions. In the same way iPad apps can change retail workflows, these on-demand services can change retail offerings.

“Don’t look at Snapchat and see just the naked pictures,” Gary Vaynerchuk says. If you do that you’re missing out. Look at it and think, how can I do this better? “If you don’t like grocery store music,” said Penn Jillette, “then you should create grocery store music.”

There’s an advantage to find areas without competition. “My game is very simple,” says Gary Vaynerchuk, “Where is the attention while the rest of the market doesn’t think it’s there? Use it like crazy, figure it out.”

We’ve seen this idea under other names. Peter Thiel calls it Zero to One. Lewis Howes plays handball because of this. Barry Ritholtz listens for “Ughs.” Michael Mauboussin uses game theory.

O’Reilly’s point is that these new employment options are fresh soil. Something will grow here, and we should prepare for the weeds in addition to sowing the seeds.

He also notes this macro idea makes economic sense (rather than bleeding liberal hocus-pocus). He cites this Nick Hanauer talk on inequality, which is worth the 5 minutes to watch.

There’s also this talk on TED.

Maps of the future are important, O’Reilly says. They can tell us about where we want to go. He wants a place where workers are empowered with knowledge and a safety net. It’s a place where big companies leverage technology in their benefits the same way they apply it to their scheduling. It’s where people are more productive workers because they like when and how they work. It’s an ecosystem.

Ecosystems

“If you mess with the ecosystem, it will come back and bite you.” – Tim O’Reilly.

If the above sounds like a rant, that’s a fault in my notes, but in part because O’Reilly speaks passionately. (And in true imitation fashion, I’m excited too). He sees the employment landscape as a faulty ecosystem. This, is a problem.

At the heart of an ecosystem is complexity theory. When you tug on something it will affect something else. Garrett Hardin writes, “we can never do merely one thing.” In Antifragile Nassim Taleb writes;

“Complex systems are full of interdependencies – hard to detect – and nonlinear responses. ‘Nonlinear’ means that when you double the dose of, say, medication, or when you double the number of employees in a factory, you don’t get twice the initial effect, but rather a lot more or a lot less. Two weekends in Philadelphia are not twice as pleasant as a single one – I’ve tried.”

Even for coffee, 2 cups are fine but 70 will kill you.

The trouble with complexity theory, unlike say, evolutionary theory, is that it’s hard to figure out what matters. Alan Watts explains in The Parable of the Chinese farmer.

This opaqueness doesn’t mean we should dismiss it says Tren Griffin. Even though complexity theory isn’t predictive, it’s still informative.It helps to know what we know and know what we don’t know.

Taleb knows this, “man-made complex systems tend to develop cascades and runaway chains of reactions that decrease, even eliminate, predictability and cause outsized events.”  

If the current economic system behaves like an ecosystem, and if we’ve meddled too much, we can expect “outsized events.”

O’Reilly believes this because he lived it. An early catchphrase at his company was “create more value you take in.” From the start his business was authentic, with $500 and some used furniture. “We sold things to real customers,” O’Reilly says, “and that keeps you honest.” They grew in the ecosystem, not a greenhouse. When they had to adapt, they did.

“We launched our publishing business when we didn’t have enough consulting work,” O’Reilly says. It echoes what Dick Yuengling said about the beer company, only their problem was prohibition. What do you do when the government says you can’t sell what you’ve always sold? You turn lemons into lemonade, or in this case, ice-cream.

Constraints help in an ecosystem. They are little nudges left and right. Like a sprite on your shoulder, do this, don’t go there.

• Stanley McChrystal says that they want to train Army Rangers to “wiggle” within constraints.

• David Levien said the clipped train ride to work help him to write a better novel.
• Amanda Palmer wrote, “limitations can expand rather than shrink the creative flow.”
• Austin Kleon said, “people overestimate what they can get done with huge chunks of time.”
• Kevin Kelly said, “lack of money is often an asset because if forces you to be innovative.”

Constraints, limits, and “not enough” of something are fulcrums for ideas. They are healthy parts of an ecosystem.

They also teach you lessons. O’Reilly said that his company had to sell stock in AOL and Google because they needed the money. They were – in the words of Nassim Taleb – merely robust.

Robustness is one of three levels of fragility that exist in ecosystems.

• There’s fragile where chaos makes you weaker. A table is jostled, a cup falls and breaks. These instances die out of healthy ecosystems.
• There’s robust where chaos makes you neither weaker or stronger. A company sells stock that might be very valuable someday. O’Reilly had an asset, but one he shouldn’t have sold.
• There’s antifragile where chaos makes you stronger. Medusa has one head chopped off and two take her place. Warren Buffett buys low because of chaos. Plants adapt.

Ecosystems change and have to change naturally. They do this when the robust and antifragile survive. A fire burns, a volcano explodes, and tsunami crashes and nature is momentarily setback but ultimately stronger.

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Thanks for reading, I’m @MikeDariano on Twitter if you want to connect. You can also get in touch if you want to work together for book, podcast, or other research.