Fat Tony's Podcast
Captivating conversations with amazing experts. Inspired by the works of Nassim Taleb, amongst others. Hosted by Sebastian David Lees.
Fat Tony's Podcast
Costas Papaikonomou - Rethinking Innovation In The Real World
Disruption sounds exciting until it wrecks your margins and burns your runway. With innovation veteran Costas Papaikonomou, we get practical about what actually works: protecting your core with calendar-driven updates, growing into real openings, and saving transformation for when the house is truly on fire. We unpack how to make change feel inevitable by aligning ideas with the line you already have, the retailers you must persuade, and the way buyers really shop.
Costas reframes factories as kitchens, where small, thoughtful tweaks produce a surprising range of new “recipes” that run on day one. We explore pace layering—why fast-moving trends fade, infrastructure moves slowly, culture moves slower, and nature barely moves at all—and how ignoring these layers creates five-years-away fantasies. From S-curve convergence in phones to the folly of biscuit brands building apps, we separate theatre from throughput and show how to launch products that stick.
We also go deep on TRIZ and the Ideal Final Result: four vectors that predict the next right move—more perfect, more instant, more autonomous, cheaper. This lens helps you spot inevitable shifts (think wireless over mechanical) and invest ahead of the curve. Finally, we step into the circular economy thesis: cutting material and energy inputs to reduce pollution while improving cost and performance. As digital growth collides with energy limits, cleaner power, better materials, and smarter manufacturing will define the next decade.
If you’re ready to trade slogans for shipped value, this conversation will reset how you think about innovation. Subscribe, share with a colleague who needs a reality check, and leave a review to tell us which pace layer you’re building for.
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Welcome everyone to another edition of the Pat Tonies podcast. I'm your host, Seb Lees. Our guest today is Kostas Papekenomu. I hope I pronounced that correctly. Kostas has spent the last three decades working in innovation, strategy, and design. He's the co-founder of the Happen Group, a global innovation agency which was later acquired by Essentia. Since then, Kostas has gone on to co-found and is chief investment officer of UNETERRA, an early growth VC impact fund. He describes himself as an innovation veteran, which I think is a lovely way to describe yourself. And also is the author of the Disruption Fallacy, Tail Wag Dog, and the Grumpy Innovation Series. Kostas, welcome to Fat Tony's. I like that. I like that. I once knew a um a Welsh-Russian, and I just think that's a lovely fusion uh you know of uh uh of cultures. So I I'm gonna bounce around a little bit in this interview, and the reason why, one thing I love about you when I've met you, when I've read your books and watched your talks, is you have this really dynamic energy that always leaves me feeling very energized at the end of listening to you speak. So I want to try and bottle that a little bit if I can, and that might involve bouncing around a little bit. But before we do that, just for listeners who uh may not be familiar with you or may not have heard of you, could you just give us a little bit of in an intro to your work, uh, maybe particularly with a slight emphasis on the happen group? Um, because I think that's where a lot of your ideas were formulated. Um so yeah, tell us a little bit about yourself.
Costas:True. Yeah, so a little bit about myself. So let me start with the uh the demographic uh specifics. I'm 52 years old, Dutch citizen, happily married, live in The Hague with two young adult sons. Um indeed uh the Happen Group period, which was uh well over 10 years, 12 years actually, before we say between founding and selling the business, happens to be between two major crises. We set it up in the financial crisis and then sold the business just before the corona crisis. Um was in a was Yeah, it was perfect timing in hindsight. At the time, we had many reasons to uh to decide to sell the business. Um, but it was an innovation agency specifically focused on, I guess, the products you would see in the supermarket and uh and say pharmacy or drugstore shelves. Uh so very mass market oriented, very mature categories that are basically products that have existed for 50 years, 100 years in some cases. And what we were pretty good at um was to figure out, okay, I mean, if you're looking at toothpaste or laundry detergents or cough syrups, those kinds of products, how do you spot what is a still a latent need, could be called, or like a frustration that exists, which is which is, I guess, relevant enough that if you manage to solve it, people will actually switch into your product instead. Uh, because it's it's not like you're launching into a vacuum. You're always launching stuff which is going to compete with someone else, and you need to convince your target audience to come across and try your product instead. And the um we were really good at that, but then we, I guess the real trick was to then come up with a solution which made sense for the type of business that our customers were. So if you are uh in the toothpaste industry, you're not going to launch some kind of mechanical device to clean teeth. You need another toothpaste to battle whatever competing toothpastes are doing. So that that sort of having two pretty distinct functions work hand in hand, being, let's say, the uh what is typically marketing and market research teams on the client side work off or sing off the same hymn sheet is probably the uh the English expression, with what the RD and a particular production side of the business could deliver. Uh, that's where we excelled. And it was uh, I mean, it was a pretty amazing uh period of my life, really, professional life. Um, because we we sold the business to Accenture. We were about something like 60, 65 people probably at the time. And um yeah, the I think we we managed to genuinely raise innovation success rates, which is what we set out to do at the beginning. So that's a long answer to your question, but uh yeah, that's uh that's the world I've always operated in.
Sebastian:It's fantastic. I always love, I think the most interesting people, I said this in a previous episode, are these people who are almost have slightly different chapters of slightly different careers through your life. And I know you've stayed in the same domain for your career, but you know, you've worn the hat of uh engineer or industrial designer, then you've gone into innovation consultant or innovation strategist. Now you've moved into uh the VC world, which we're gonna talk a little bit about later. Um, but I want to start with your book. So, or one of your books, should I say, but my my favorite, the disruption fallacy. So at the beginning of your book, you uh you argue that um companies should be focusing less on transformational innovation and more on um I think you call non-disruptive innovation. And you mentioned, I think throughout the book, kind of three categories of of innovation. And I've noted them down here innovate to protect, innovate to grow, and innovate to transform. Can you go a little bit more into those three categories and explain to listeners a little bit about what the difference between those is?
Costas:Yeah, so what they have in common is they're all business objectives. This is not about innovating because you had a bright idea under the shower or while driving to work. What it says is innovation is a business tool which needs to service the business in a particular way. And you can decide that up front. That's the interesting thing. You can decide up front what is the kind of innovation we need, which is basically updating our portfolio of products. And again, it could be anything from lawnmowers to aftershaves to shower gels. But what do we see in the market that's happening, which tells us how do we need to update our portfolio? Um, and not only can you say that up front, but for the vast majority in these, let's say, mature markets, and almost everyone operates in a mature market. There's almost no one busy developing a brand spanking new one. Um one thing you know for sure is if you don't do anything, your computer competition will. And this is where the innovate to protect comes in. And this is being brutal, uh brutally tactical around what's the kind of new news I need to bring to market just to make sure I keep the customers I have. Um and customers, and if you think about supermarket products, um even just defining what a customer is if you are selling stain removers, is actually less precise than you might think it is. Because of course everyone thinks, oh, yeah, that's these end users who sit at home and they're doing their laundry and they're adding stain remover for to remove stains and they you want to keep them happy. But actually, you could make a case that for that kind of innovation, it's not even consumer focused. It's focused on the retailers who sit in between, who need some new news to take to their shoppers. So it's a different dynamic. So, how do you give them something interesting to say that they will indeed make a few percent more in their shopping basket, because that's the the mechanic they use, off a particular aisle? Um what is a little bit frustrated, or what was sometimes frustrating is the when you look at people working inside these big multinationals, managing brands, managing uh uh their portfolios, of course, they themselves are career focused and they want to have something spectacular to talk about. That usually is not uh updating a claim strategy or saying, I have a new recipe, even though that's what the product they're working on very often needs. Innovate to grow is exactly that, which means you're looking for ways to create products or to update your products or to do something through which your portfolio will start being sold to people who are now not buying your product. And of course, you could make a whole sort of uh debate around is that actually not the same as protecting because you're just stealing share from someone else? Well, to some degree, but in reality, what it involves is really looking out maybe to another geography, or if it's or maybe you're seeing if your brand can actually sell a new type of product in another category. And so if you are now in cakes, can you move to biscuits? I mean, that's like that sounds like a subtle difference, but that's a big deal if you're inside a large organization, because you probably need to build a whole new set of relationships through sales to make sure that you're and because whatever then you launch is going to come at the expense of taking someone else off shelf. So that's a like really, really intense. Um, and then the third type, innovate to transform, which of course is always where people think you need to start. So we need something disruptive, we need something that's going to be absolutely radical. Um, but you really don't need that if your own market isn't broken. I mean, you can go out and disrupt someone else's industry. I mean, very welcome to do that, which every now and then happens, not anywhere near enough, I would say. Uh, but to transform your business is usually when you're in a complete crisis. Um, and then all rules go overboard. And this is also something you can really, again, we we work from like let's say an agency standpoint. When someone comes in and says, I need a disruption, then well, you need to make them aware that you're probably not going to be sure if you will even have a job yourself at the end of that process, given you're looking for something dramatic. And yeah, if you if you would want a rule of thumb, sort of what is the split across these, let's say, types of uh innovation in any healthy business with a decent, let's say, innovation strategy, you would say probably up to like 70% is just protecting what you have. And then maybe 20, 25% is uh growing and looking for ways to grow. And whereas protecting is something you could do calendar-driven, looking for growth, you actually need an opportunity. You need to be clear to yourself, where do I see the gap? And then you would spend just a few percent on transformational initiatives, which is just making sure you're a little bit aware of what's on the horizon and sort of keeping yourself sharp to not just being trumpled by someone you hadn't even realized was working on your case. Um, it's the sort of uh be at the table, not on the menu type um uh type thinking. So yeah, that's um, but again, uh all serves the business. It's it's these are business objectives and not just uh oh, let's go change stuff for the heck of it. Because you don't need to. Um maybe the big difference across all of them is you always change, and this is again again across all three levels, you change as little as you can, which is counterintuitive because the more you change, the harder it's gonna be. Um it's very simple in the end, but you you don't need to change much to uh to make a difference. Sorry, it's a long answer to your question, Seb. I hope that's okay. It's uh it's fine.
Sebastian:I love long answers. Um, so what I really find interesting at the beginning of that, you mentioned um I talked about mature markets, and because you know most most businesses, most large businesses operate in a mature market. What I find interesting is since about 2005 or so, um has tech and the kind of tech philosophy of innovation has kind of come to consume all markets and all worlds. Um mature markets has almost become a dirty word. It's it's like we have to constantly be emulating um this kind of tech philosophy of constantly innovating for innovation's sake, which I know you you argue against um in your book. And as a software developer myself, it's been really weird to see this kind of cargo cultism almost spread. Um, you know, lots of stuff that was born out of software development, the lingo, the terminology being adopted by managers in completely different spheres. And I think in a way, I mean we talked about cargo cultism, and there's almost, I think, a kind of semi, semi-subconscious role-playing, I think Nassim Talev says, uh, uh, at stake here a little bit. How do you think we can pull back from that or convince stakeholders, convince C-suites, convince managers, but you know, no, that isn't. Have you have you found that challenging with your role at Happen Group to convince them that you know the the iterative way is the way we should be going?
Costas:Yeah, and it's a it's it's it's yes, uh, it's always a challenge. And it, if anything, it was a challenge of uh well, it's still a challenge now in VC. I I am literally on the other side, and I have to convince investors that listen, you don't need to change a lot to be successful. All you need to do is understand what's the actual constraint that you need to work within. Um, and uh I like how you frame that the language from let's say tech and by and tech, by the way, is also a funny word, because we're actually it's not tech, it's digital. I mean, technology, a factory line is is from my point of view, much more art tech than uh a few bits and bytes. Um, I think the the language and the the ways of working uh that are being adopted from the tech world or digital world are if you could make a case they're mostly counterproductive. Um I remember a period around 2015 um where not only um I mean, actually every single customer of ours, and you're talking to you're talking about like the big multinationals, they were setting up incubators who, and an incubator inside, let's say, an in a multinational who's mainly known for making cleaning products. What does that look like? You get basically the CEO himself or herself, but mostly himself, to get involved with like 25, 26-year-olds who are being given the same problems the experienced people in their business also couldn't solve. And again, these are not new problems, these are problems that have existed for 50 years because they're mature categories. And they give them 100 grand, which of course is a 1% of what such innovations typically cost uh to bring through successfully. And then you hope that something good will come out. And um, and they they literally, there were so many who took that to like the crazy extremes of trying to copy what was happening in digital along the lines of, yeah, and then we're going to uh instead of doing market research or or or test launches, we're going to actually we're going to create a fake Kickstarter and see if we can sell products before it exists, and that will tell us how interesting. I'm just thinking, you have absolutely not understood how you're, or you're just ignoring, blindly, willfully ignoring how the category works that you are in. And if you had rather worked in digital uh because it seems the rewards are higher and it's more exciting, well then go work in digital instead of trying to transplant some of what you see in a space that simply doesn't accept it, because the PL, some of these businesses run, uh, where effectively the margins are, like I said, they're like negligible, will not accept a model where you indeed uh overinvest like uh as if you're open AI, uh hoping that the returns will come sometime in the future. Yeah, also I mean the whole valuation of a young business in let's say digital is all about how much money it can raise. It has nothing to do with the amount of revenue it generates. Whereas, of course, if you're a stock-listed multinational consumer goods company, um there's maybe a little bit of uh how much interest there is in the stock, but it's mainly the numbers every quarter that drive your value. So work accordingly. So I'm meandering a little bit around the uh a very direct answer, but I think um it's just uh it's been it's just been shocking how willfully uh sort of ignorant people are willing to be to force something they think will work into something they know just it's just it's these are not compatible in these domains. These are not compatible. Um also the uh sorry, it brings back awful memories of even like biscuit brands, like literally just we're talking biscuits, like that's bottom shelf, low margin, uh just uh fodder. We need to create a digital ecosystem around our biscuit brand, and people are gonna and we're gonna have them download an app for the experience. I'm just thinking, and the amount of money wasted on this stuff style kind of nonsense is just it's mind-boggling, mind-boggling. Um yeah, it's uh it's just and everyone will just jump on the bandwagon. No one dares to say it's a lot of emperor having no clothes, I think, is the uh the metaphor. Just no one dares to speak up. Yeah. Yeah, and the ones who who do have sort of a simple uh system of okay, every year we get a few things out just to keep everyone happy, and then every two or three years we launch something big, and then if we do it right, that will actually pay. Because I mean it's it's it's a it's like a little machine if you do it right. If you invest heavily on a new factory line because you have a dramatically new, fantastic new product, then you know for the next 10 years you're just going to do variations of that product on the same line, which is a fantastic way to make sure everything gets paid, everyone makes money. And you know, don't install new factory lines for on a whim every time you think you you have a small tweak. So it's if you if you can manage that, there's um there's just no way you can lose almost. Um, because the obstacle is always the asset. If if whether you're a small business or a big business, everyone's frustrated by the factory. Either it's too big or they don't have one, uh, but no one seems to understand how you can use it to your benefit, which I also touch upon on the book, by the way, which is if you look at your factory as a kitchen, you've almost won the war already. Um, because just like you can do different types of Indian meals, Chinese meals, French cuisine in one and the same kitchen, you can do a lot with one and the same factory if you if you respect it. Yeah.
Sebastian:It's um I think that's in the second half of the book. Really, really it's a fantastic book, by the way. I haven't really gone into this, but um, you know, myself, I read it, and several friends have all commented privately on on how fantastic it is. Um the the yeah, the the innovation for innovation's sake, um, I think there's a quote from your book where this is co-related to what we just talked about. And the quote uh is um innovation is often outsourced, I'm I'm paraphrasing here, uh often outsourced to a single person or team within an organization as if it's HR or marketing or something. And once you you you go into that dynamic and it's kind of ring-fenced and protected, you I think you are going to you've already failed because you lose ground with reality, you lose, you know, lose ground with what's happening on the factory, or even if you don't have a physical factory, you know, the factory floor of your business, and you you know, you're gonna you're gonna lose lose grip of reality and go off into uh all of this spiral eccentricity of crazy ideas.
Costas:Yeah, a um maybe a metaphor, also I guess linking to some of Alep's work, which I guess is sort of the the linking pin on even how you and I met, is uh anti-fragility. And if you look at an organization, a business, and it could be any business really, but I guess for like in my domain, these are consumer products businesses, um, the world around them, just like the world around us, is changing all the time, whether you like it or not. And uh, we used to have fun inside the agency because March was always a three-year planning period, and you just know every customer who creates a three-year plan is just rewriting the plan that was already useless two months in the from last year, uh, because the world just changes too fast, even if you are in, let's say, uh cough syrups or something which you would think is a stale category. Um, and anti-fragility is, you could say, the prime function of an innovation role, I guess, in the business. And it's not something indeed that is isolated to a small group of people, but everyone in the business needs to be continuously thinking, okay, I know the world is going to change. How do I make that good for me, given it's pretty certainly going to be very bad for many others? Because none of these big businesses are used to, or at least enjoy um being in the moment. Uh, even though they work quarter by quarter, you would think they're super short-term focused. No, not for from an innovation and RD point of view, they'd rather have nothing change. Um, so they can basically predict whatever to put into the reports uh long in advance. But if innovation is almost like that anti-fragility uh cover around the organization, sort of absorbing the new things that are coming in, whether it's a big trend, a small trend, something that no one had expected, and just seeing if they can almost like transplant that from the, I guess, the innovation sort of domain or or creative domain. Ooh, something new, we need to change something, and then convert that into something which becomes part of the operational element of the organization, where you can where you've managed it in a way that it's become part of the products you create and it's it fulfills whatever that change asked from the organization in a in a um in a truthful way, not like in a quick and dirty patch up way. Um and yeah, that's uh again, businesses that are always doing well is probably because they are always making small changes. Because that also means you never need to do the big dramatic change, because you never really get into deep trouble. Um and you have enough sort of going around with with uh, let's say, creative, uh, and maybe that's another thing here. If you have a if you are running your organization, let's say like a Six Sigma lean machine, and you're just always on the operational excellence uh uh path, then you will attract people into your business who just love optimizing. And uh you're just on one single track, which is making your own products cheaper, which in practice making them worse. Um, and no one with a creative attitude or a bit of a gung-ho, let's try something else for once attitude, which you need in any organization, they simply won't want to work for you. They see because they they will always say be disappointed. So it's the actually one of the very first articles I ever wrote uh when I was, I guess, coming into this domain was about the evil twin of operational excellence, which is systemic inertia. You just you just completely lose the ability to do anything besides what you've done before. Um it's quite um it's quite a thing to see happen in a business. I've actually recently seen it in a uh a client which I won't name. Um I did a uh a project, a bit of a consult, basically sort of a I won't say boardroom consulting was a little more closer to the ground, uh, but a productivity question. And uh what I guess what I found was, also to the surprise of my lead client in this piece, is that a whole organization had forgotten what productivity means. They had just considered it only as how do I make as much as possible, as cheap as possible. Whereas if you look at a factory, you can probably imagine if that's the only thing you're doing and the market is actually changing, you're not being productive at all. You're being the opposite of productive because you need to do a lot of rework, you get a lot of uh reject literally from your customers, etc. So productivity itself even has a innovation goal, which is how do I change my factory setup so variation is welcome rather than the opposite of what I want. Very different mindset. Um anyway, sorry, meandering all over the place here, as I said, but I you you gave me license to you gave me a license.
Sebastian:You have full license to be as random as you want here. We like we like a certain amount of randomness here. There are a few things I want to pick up. So a good analogy that I like is this difference between the um the the captain of a container ship that will horizon scan and make short course corrections versus a speedboat but will rapidly uh go. And I always think when talking about anti-fragility and related concepts, I always always have that in my mind. And you're talking about the factory as a kitchen in relation to anti-fragility. And correct me if I'm wrong, but I think in your book as well, towards that that part of it, you talk about how sometimes there's this over-emphasis on these kind of class A products within companies, which are the innovative, you know, really good ones, but you know, you are good, yes, it's great, but the competitors will always catch up with you. You have you know a limited shelf life to take advantage of that, and to be truly anti-fragile, you want to be using your factory to produce products across a whole range from the you know, the class A, innovative, right down to kind of the more generic stuff, and just be able to absorb it. And another concept that I love um it you talk about S-curves, but you talk about them in a way I've never come across before. Because when I think about S-curves, and if uh listeners are familiar, again, closely related to anti-fragility, and I think Talib himself argues that uh anti-fragility is dependent on S-curves where they're resistant to a certain point and then they will snap and break. So a good thing is you know, human muscle growth might be the they can in to a certain level of of um uh damage, they will regenerate stronger, but if you push them too hard, they they will break. And what I love is you talk about it in a slightly different way and you link it to innovation. And you uh the the great example that I love because I live through it is you talked about the experimentation of mobile phones in the early days when it came through. And you think there's this F-cove originally where we're trying to find almost this platonic form of what a mobile phone should be. So we go through go through this kind of rapid, crazy iterative phase. And I remember I remember a mobile phone that was like a lipstick that you like opened up and it had a ton, and I remember ones that were like circular and had a circular keypad. It was crazy, but it was really fun. And then obviously, of course, um the smartphone came and we land on this um um rectangular thing. Um, what's interesting is I think we're seeing a little bit of that again. Now we're jumping to the next S curve. So to backtrack slightly, so we go through this S curve of progress, and then we kind of find the platonic form and level out, and then the next innovative leap comes across and that becomes irrelevant and we start again. And I think we're seeing it slightly with foldable phones now, or we're gonna see it with foldable phones over the next couple of years. I think we've seen it with cars. People often complain why do all cars look the same now, and they kind of converged a little bit. Um, but I love it because I've never heard S-curves used in this way before. And I think it um links closely to a mutual friend of ours, Gerald Ashley, who in his book Two Speed World, um, talks about how innovation iterates slowly. There's two speeds to the world, which I think is closely related to pace layering, which we'll talk about later. But um, you know, you have the gradual evolution, and he talks about um clipper ships and transport ships, and how they and the cutty sark, I think in particular, how they got faster and faster and more efficient, and then suddenly steamships come along, and that's kind of the end of one S-curve and the beginning of another, and that's the two speeds to the world. And I just think the use of S-curves in Rutwa is brilliant and very innovative, and I think it's a great model to use to describe them. Um, I want to let's talk about pace layering, and and I'd love for you to explain this again in a bit more detail. You gave a talk at the uh Fab Time News Oxford meetup a few months back, and I think my favorite slide was the pace layering slide. So we are please tell the listeners a little bit about more about this.
Costas:Yeah. Oh man, pace layering is that's one of those things I wish I'd known 15 years before I know I learned of it. Uh gives so much help in understanding how some things are difficult and some things are hard. So, what is pace layering about? Um uh given I'm allowed to meander a little bit, let me give you the the the the backstory, which is uh Stuart Brand, uh an engineer, uh he's now in his 80s, I think, uh, in the 19 uh early 1990s, with a group of people um decided to um to take on the challenge of building a clock that could run for 10,000 years. Um, it's a wonderful book called The Clock of the Long Now, where he describes uh sort of that process. And um the the beginning, of course, you think about this is probably a technical problem of some kind. And how do you create this? This is going to be really technically hard. And of course, if you have a group of smart engineers together, you'd realize this is this is not technically an issue at all. This is just easy. The problem is you're instead of having like a clock that is like uh just splicing up a human life in tiny bits, this is a clock that's made up of many human lives in its sort of length of its uh so you get into all kinds of what they call deep time problems. Um and they start the whole book is basically an individuation into time and how there is are things like fast time and slow time, how things evolve at very different paces. So, which you can take into account is just to make sure that if you if you need, for example, markings on your clock that you need to be sure of, that if your clock just disappears under a, I don't know, sand dune for 2,000 years and is then dug up 3,000 years later, and people look at it, what kind of markings do you use to have any chance of them understanding what they're actually looking at and being able to tell what time it is? So there's fascinating elements there. Now, what is pace layering? Pace layering is in it's it's in the book as one of the many, many big uh insights it gives. It just shows in a simple way how the fabric of society. You could say, is basically made up of a number of layers of organization, which if you're familiar with the Lindy concept, that's what it connects to very, very strongly. So if I just go through the layers from uh let's say fast to slow, and by fast I mean evolves quickly, changes a lot, the top layer is basically the layer I've operated in for many years, which is new products, new services, fashion, the flavor of the day. It's stuff where you just know it's like fleeting. Um, and you have to acknowledge it is fleeting. So if you have a new flavor you're taking to market, for example, in a uh in a particular food product, don't expect it to last 20 years. That's just not gonna happen. You're gonna have to update it next year and then the year after. This is also how people switch from Christmas to Easter, uh, say, as a uh context for creating new products. So that's a very fleeting layer. Underneath it sits what is called the let's say the layer of commerce, how you exchange value, how you pay for things. Um, and this is this is much deeper embedded, you could say. You can already feel it is in how society works. So um it was really funny seeing, for example, during the corona period how there were all kinds of expectations this would change forever. Yeah. So, for example, yeah, you're you're gonna order your laundry detergent online and you're gonna never do it again by just walking into a store and buying it there. And I was just thinking, people have been buying laundry detergent for 100 years in stores. I don't think they're gonna change just overnight because they can't right now walk into the store. So what you see is actually changes there are much more, much more difficult to get to stick. But what it also tells you, if you have a radical new product in that top layer, for God's sake, make sure that it's on purchase or on sale the same way its direct competitor is. Below that sits um the layer of infrastructure, which is literally the factories, the roads, everything you need as a uh technical, usually technical platforms for anything of the above to work, which is of course even more obvious. Um if the and we see this in the VC world, this in our VC fund, this is the topic we try to raise to the surface all the time, which is because our fund focuses on circular economy and let's say more sustainable materials in particular. But the number of businesses or startups and scale-ups working on like seaweed-based, micellum-based, all these weird materials in the top layer, expecting to, for example, make packaging from it. And I then have to explain, listen, there's like probably a trillion dollars worth of packaging machines out there who are aimed at like things that look a bit like paper, plastic, or metal. If your material doesn't run on one of those machines, you just can forget it. There's just no way it's ever going to scale. If anything, if it can run on those machines, you're going to scale like crazy because infrastructure doesn't change quick. Now, maybe to go a little faster through the others, below that sits the layer of governance, which is anything from regulation through to religion. And below that comes more even more interesting, culture, which for me was also always the stick to hit plant-based innovation with. I mean, do you think an Italian mama is going to make her meatball recipe that's been handed through the generations with some kind of pea protein-based ball of protein? No, of course not. And you have to acknowledge that. And of course, all these businesses are now failing. And I've literally been sort of whacking that uh since day one. Um, and then below that even sits nature, which is even slower. So where culture changes over the course of generations, which is way too long for the typical sort of marketing managers patients, nature is even slower. And when you look across those layers and you start asking yourself, okay, what are ways to, I guess, to break them and to get them to work in your favor? Um, I think what you very quickly realize is if you turn it around, is thinking, I can make it, I can I just use the the natural pace they have and stay out of trouble that way, even if it might not sound obvious, it's still probably the right thing to do. Um, food innovation, by the way, is the hardest in my experience because it goes through all layers. It is usually a natural, naturally based product with its culture associated, etc. And I think the Lindy principle is interesting because it kind of shows how even if things come in at the top layer, if they stick around long enough, they become part of culture. Um and that's why they stick around. Um so yeah, the I think the the pace layering is just it gives you such tremendous insight on what is likely to stick and what is likely to fail, because it's picking its fights either on too many levels or on the wrong level, or just ignoring the fact that there is a level below that's not going to cooperate. Um and uh it's uh it's just a wonderful piece of of of knowledge to have. As obvious as it is, once you have it presented to you, um yeah, it's uh you can also see it.
Sebastian:Since since I've learned about it, since I learned about it, I've been seeing it everywhere and I've been applying it. And again, just to pick up on two or three things from what you just said, the clock up along now. I think that Jeff Bezos might have been involved in my correct me wrong.
Costas:Yes, Jeff, he uh he he he funded the uh the project and uh I think because they they I don't think they built the whole thing at scale. There's a I built a few small ones uh because I think the the real thing is supposed to be like built into a mountain somewhere because the mountain operates at slow time. 10,000 years is nothing for a mountain. Um so that's probably where it's safe.
Sebastian:Yeah. The the it's interesting. Uh literally three or four days ago, I was talking to a colleague, not about the clock of Long Now, but a very similar related concept, and he was telling me about a project involving um nuclear waste. And the idea is how do we build a warning sign that in three to five thousand years could still communicate that this is dangerous? Do not and we don't know what civilization is going to look like, we don't know what language is gonna look like. How do we communicate danger across what you'll take about the lower layers of there uh across you know 10,000 year timescales? And while you were explaining that, I was also reminded of something I saw um uh modern artist, can't remember the name, I apologize, but they built this gearing mechanism, and you you know, you turn the handle or it was attached to an electric winch, but you know, the the first gear was turning rapidly, and each lever of the is only about you know half a meter wide, but by the time you got down to the 10th layer, the cog turned once every billion years, and it's just wonderful. And one thing I hadn't considered before mentioned about food eventually becomes cooler, it can start at the top layer, and I'd not thought before about this crossing of layers. I always thought of them as impermeable, but that's really interesting because you're right. Like if something's sticky, if something's lindy enough, it will be promoted to the next layer, for want of a better word. And uh until eventually, you know, it can even be promoted. I think food, I'm trying to think of an example, food could even be promoted to the evolutionary layer, and um, maybe lactose intolerance here, where originally all humans were lactose intolerance because we only had dairy during childhood, but over evolutionary scales, the majority of people have learned to tolerate dairy purely because it was introduced at the food top layer. Um, lovely, wonderful. Um, so um let's talk about I'm gonna talk about one or two more concepts from your book because I love there's so much high value from you, and these concepts I want to introduce the listeners to as many of them as possible in the time we've got. So um you talk about ideal final result as a kind of shortcut. So could you uh and and I love the um analogy you give of the the I think there's a monkey with a lawnmower, and you talked about the lawnmower earlier, but yeah, exactly.
Costas:Shall I just give that example? Yeah. Yeah, so maybe to um there because uh the ideal final result is connected to um uh a body of knowledge called TRIS, uh, which is also through which the S curves, by the way, um it's maybe it's again, it's a little sidestep. Um I'm going to do a brass generalization of uh technology history. Um and uh mention a gentleman called Darryl Mann, who first introduced me to the concept of TRIS uh over 20 years ago. Still good friends with him. Spoke to him yesterday, actually. Um so TRIS TRIZ is an old Soviet system. And it was uh it originates in the uh in the 40s, late 30s and 40s, um, when it was developed. And what uh this group of Russian, typical sort of Russian technologists did is they looked at patents across the globe. Um, and what they distinguished was uh what are patents that are actually protecting a genuine genuine leap in in in or an advance in technology, and which ones are like, I don't know, the uh raincoats for dogs or inflatable umbrellas that sort of don't protect anything meaningful. Um I think they were actually the first to identify the principle of an S-curve, is that there's a lot of movement, a lot of patenting around nonsense in the early stages. But then by the time you get to the top, a genuine leap made there, that's sort of what they are the valuable patents. So what they saw was sequences of S-curves being true mainly in technology. But what they also saw was you could kind of you could not only just predict what the next step was going to be, but you could also deconstruct the type of problem they were solving into a very limited set of solutions. I mean, this is a topic for a whole other book, but you can almost take any problem, any technical problem uh you can imagine. Um, and actually Darrell has also taken that into like social context, et cetera. But once you understand how to describe the problem, you can just literally look up the solution. So a very simple example of that from the pure engineering world is if you want something that is both very strong and very light, then the cliche approach is there's some kind of compromise. We'll make it a little bit strong and a little bit light. If you uh on the other hand, look the use of the Triz principles, you can then see uh there are a number of solutions, four or five, which will always work. It's like doing things like uh hollow cores, it's the things like doing composites, it'll push you into the right direction immediately. It's fascinating. I truly believe that's why the Russians were so far ahead and got to Sputnik first uh and did these crazy engineering marvels in the 50s where you're just imagining how is this even possible? Like the ekrano planes and all these crazy, crazy devices. Um uh anyway, so that that body of knowledge still exists, but it's very niche nowadays. And um, how do I how do we get to ideal final result? Is basically ideal result, final result happens when you stack say S curves into infinity and ask yourself, where is this eventually going to land? And again, a lot of hard thinking by these people, realizing that if you again break down evolution of products, because if you look back across 100 years of patents, you see a lot of patterns. You see that if, for example, if a smooth surface is like the most super important for the function that you give to your device, and you need smooth surfaces. Again, common sense would say, well, the smoother the better. No, it's what they show is actually the if you put like a little bit of a dent in the surface, that's usually the step to a more ideal solution. And you think, how could that be possible? Well, just even think about like the surface of your desk that you're sitting at now. If that were super flat, it would be scratched in no time. On the other hand, if it has this tiny little microscopic dimple in it, it actually doesn't scratch. And then a level higher is it like putting like an active ingredient in the little dimples, and you think, well, what kind of sense makes that? Well, if you look at window panes, which of course the the most modern windows have a so-called lotus effect. They're not flat, they have like a little dent, and then they also have something like a wax layer sort of in the so basically they become self-cleaning, and you realize, okay, so this is how things evolve. Now, all the way at the tail end of that sits ideal final result, and then that get then gets super simple. Um, it is like the best kept secret for any innovation agency that knows it is how can you predict what your customer is going to have as an update that is worth pursuing, which is um there's four principles. And I've tried to disprove this for ever since I heard of it and can't. Um so the the first principle is that whatever the benefit is your product is delivering, it will do that more perfectly. And this is usually where almost every innovation team sort of gets on completely sort of blinded by that's the only thing they're gonna work on. If you're working on a cleaning product, how do we make it clean even better? Um, if you're working um on a on a cough syrup, how do we make it remove the itch even better? Sort of those very, very monomanic sort of focus on that. But there's three more. Uh there's how do you make something more instant in delivering its benefit? Uh so it's it's there when you want it and it's not there when it's when you don't want it. Um the third one is how to make it more autonomous, so it doesn't need fuel or information or anything from the user to provide the right benefit. And then the fourth one is it becomes free or very, very cheap. Um and uh we talked about uh the digitization uh sort of uh world or coming into the say typical categories, where genuine transformation has happened is very often where a physical solution has turned into a digital one because they actually resolved all four directions in one go. Google Maps is my favorite example, uh, because it it literally is a better, petri at getting you where you want to be. It does it instantly, it does it autonomously, and it does it for nothing. Um and the if you have that mindset of understanding there's a this array, these typically these four dimensions along which you can innovate. Again, if you look at the through the lens of a company, you also realize shit, there's actually different functions. This is not just RD, because doing instant solutions, that's usually something related to logistics or distribution. Um, if I do autonomous, my god, I now get the IT team involved uh to actually maybe take orders before they're even given and things like that. Free means you need to work through the whole supply chain rather than just trying to come up with the next fancy idea. Lawnmowers is the example I use in the book, which is because it's almost no one has worked in the lawnmower industry, even though actually a friend of mine who I had spoken to for a while, he called me after uh he got the book and said, I'm gonna start a new job in the lawnmower business. Um, let's talk about this. Uh, but it's it's a funny one because you can just predict what the next thing's gonna be. And the so if it's more perfect, it's about okay, how do I create even nicer, flatter lawns, maybe a laser guidance system, maybe ceramic blades that never go dull. If it's about autonomous or even the command, let's say combining it uh with instant, it's probably a robotics uh thing that sort of starts mowing when the grass is a certain height. Maybe free comes through putting solar panels on. Uh anyway, you can go endlessly, but then you also realize a little bit like the Google Maps example, is just like uh people want holes, not drills, people want a nice lawn, not lawn mowers. So the real revolution will come from crop genetics and things like that, where you basically your grass self-cuts. The word self is a very interesting sort of word to put in uh in any innovation project. How do you get it to self, whatever? Um, sorry, that's a very long answer to your question, Seb, but it's a fascinating thing. And it's very much something we use in the in the fund also, because when you get like a hundred uh startups thrown your way around showing how they can, for example, uh be smarter at charging cars, um, and you realize they're all doing some kind of mechanical solution to get like a plug inserted into the car, you realize, well, that's just nowhere near ideal enough. So even if it's the hottest thing now, in a couple of years, they'll be trumped by something which is wireless, because that's more ideal. So it also keeps you alert that there are, even if it doesn't point you to what is the right solution, you will have a sense of how ideal are we now, which is an important thing to keep in mind when looking for businesses to invest in. Because the the more ideal thing is your greatest enemy, even if it doesn't exist yet. Um, it's it's going to be around the corner. Fascinating.
Sebastian:Absolutely fascinating. Uh the you know, you talk about hundreds of startups, and we we will move on to the VC fund shortly, but I I'm struck again by the the the pace layering example, and I think you do mention in your book one of the biggest problems you see when you see a startup come with an idea or a solution is they don't quite understand the levels they're targeting. So they might be you know talking at level one, which is perfectly doable, and maybe level two, but then they've also got a bit of level five in. And it's you know, you're you're you're gonna run out of cash long before you can you can move the move the dial on that. And I think you know, you talk about food a little bit more, and I think you talk about um food startups that wanted to you know introduce the concept to the West of eating insects as they're you know, and you know, it's just and you see this is one of those news stories, like use insects to solve um you know the food production problem. It's one of those news stories you see come up every four or five years or so, um, since certainly since you know the 1980s. And again, our mutual friend Joel Ashley calls this uh the five year, the perpetually five-year-away headlines. And there are lots of categories of these which are always five years away but never seem to come. And flying cars is is the absolute greatest example of this, which um, you know, we're probably never gonna happen. They're called helicopters, yes. So, you know, and I think this links in a little bit to a piece of advice through, you know, don't replace what works with what looks nice, which I think tech is absolutely the fatalism in tech towards doing this is absolutely endemic and it's spread like a virus. Um, so the very, very last concept I will bring up before we move on then is is towards the end of a book as well. I think it's actually mentioned in the foreword, but then it isn't um brought up towards the end of a book, but this concept of the asset out approach.
Costas:Yeah, it was uh probably one of the uh because we had a couple of unique things we did in the agency in the happen group, and this was one of them. So super hard to sell. Um, but it is so what is the asset? The asset is the factory. That is usually what was the uh the thing in question. And uh, how do you use that to decide what to do next? And uh this goes right against the uh the grain or uh uh or like against what usually the people who are responsible for innovation want to hear inside a business because they usually have a marketing background, and then you can say, well, okay, so we're gonna decide what to do based on what your factory can make. Okay, then you're usually out the door like immediately because they just cannot conceptualize that that could be anything good. Um, whereas, of course, uh after a couple of years, they realize, well, unless I acknowledge what the factory can make, my innovation project will fail. That's a but uh this is also one of the handicaps you could say, which has only gotten worse over the past say decade, is that it typically innovation has gone down inside the organization. So it's richly managed by juniors nowadays, who probably have never even been in one of their own factories. So they have no concept of how things are made, so they just react to what they see in the outside world and they say, well, we want one of these because the competition can do it too. So asset out innovation is um it is indeed respecting the factory line, um, as in, well, whatever we're gonna make, it's probably gonna run on the lines that are now underutilized, because that's where we can basically quickly make new revenues, new money, new volume, new everything. Um, and the way we we we did this, and actually every now and then still do this, uh, because it's such a still again contrarian way of working on innovation projects, is just taking that approach of okay, what if I consider this a kitchen? And then the fascinating thing with a factory line, if you've ever been to a factory, whether it's food products or or cleaning products or anything um uh that is almost anything that you find on your supermarket shelf, is there's usually about 10 to 12 steps between raw ingredients coming in in the warehouse and the finished packaged product at the tail end. And each of those 12 steps does something to the product. Um again, this is it sounds obvious, but it's quite hard for people to believe. Like if I take uh I have a tennis ball in my hand here, like every physical element I can touch, see, smell on here is it's come into existence somewhere on a factory line. It's there on purpose. It's not coincidence. Now, each and every one of those 12 steps I can individually change. I can get like uh maybe one step I can run a little hotter or colder or faster or slower, or I can put a new ingredient in there, I can replace something. That will therefore automatically have an effect on what the, let's say, physical output of that line is going to be. And of course, some things are simply undoable because they would jam the line, but many things are possible. And we start this deconstructing it that way, and you realize for every product step, there's been maybe five or ten different features I can create there. Suddenly I have 50 features to play with. And the way this methodology, as we developed it over the years, works is doing exactly that. So it's taking a very agnostic sort of standpoint, and this is what made it palatable for innovation teams who just don't want to be told by a factory what they can do. You basically translate the factory line almost like in a palette of, we call them building blocks. Uh, or if you if you would look at it with a metaphor of a painter, these are all the colors you can use. You've been painting products only with blue and green, but hey, look, with a few tweaks, we can make all these other colors as well. Um, and the creation of a new product idea then becomes, I would dare say, almost as simple as understanding what the gap in the market is, what the consumer need is, whatever the you could say the uh the that topic was that you've discovered needing a new product. And then you see, can I assemble that with the features that I now understand my factory line can make, which are beyond, of course, what I knew before, because I thought it could only do one thing very efficiently. And now I see, oh, it's actually indeed uh 40, 50 uh different things it can do very efficiently, or maybe even 100. And time and again, because we I mean, I've personally been involved somewhere, probably I don't know, between 60 and 70 of such products, uh projects over the years, including in things like powdered beverages or water, where you think, how on earth can I do anything different on that line? Well, even there, even there, you can do something like I remember one in uh actually powdered beverages uh in South America, which is like the cheapest of the cheapest crap beverage in a very crap market, in a sense, because these are all very, very low uh bottom of the pyramid stuff. Realize then if you have a powder beverage to copy an orange juice just so that people have the think they have orange juice on the table, even though they could never afford 10 oranges to squeeze into uh into a jug of orange juice, in that powder you can add bits to make it give a sense that it actually has uh a little of sort of the um the orangey bits uh in there. So it's not like a smoothie, the texture. And then you realize, well, actually, if I put even a more little more thickener in, and maybe a little bit of powdered milk or things like that, all of a sudden it starts turning into a smoothie. And then you realize that even with that very basic sort of one lint mixer say technology, you can create features that are dramatic for the end consumer. That's again, that's what this process allows you to do. And I would, okay, if I make a very, very bold statement, but I I I would take that on anyone who wants to fight it, is because you're staying within the reality of what your production environment can do, the wackiness of the products you're trying to take to market is also dampened and therefore has a higher chance of succeeding because you're just staying within the realms of of what will be not just feasible from a technical point of view, but also, I guess, commercially from a buyer's point of view. You're not going two big steps in one go. So again, if you are if you have people uh in the business who who can who can play with the manufacturing environment, almost like a musical instrument that way, and really understand how it works and really understand how you can modify it, tune it, tweak it, then there's just there's just no way you can fail. That's the thing. It is um but you have to sing off the same hymn sheet. You have to understand, like any small business will, that factory is your asset, not a ugly thing barrier to success that sits on another continent from where you are, where you don't want to want to work with them. Um that is asset out innovation.
Sebastian:Yeah, it's uh I think we're falling prey to the the kind of forgetting. You said it earlier, but you know, tech, people instantly think digital, and they forget that tech, technology, factory, production, infrastructure. And we fall prey to this digitalization of everything now. Everything has to be, you know, zero cost, uh, you know, digital, replicable, and you can just deploy. But really, what powers the world, what really still powers the world, despite what we popular believe is infrastructure, factories, it's there. Infrastructure.
Costas:Industrialization, which is the European drama right now, is the industrialization has just fallen so far behind where it should be, it's very hard to rebuild because the um it's like centuries-old knowledge. I mean, the UK got this close to closing its last steel plant. Um the Netherlands is now very close too. I mean, if you cannot make your own steel anymore, my point of view, you're not a real country anymore. Um, you're just some kind of uh dependent, uh yeah, not serious country because steel is at the foundation of everything.
Sebastian:It's you know, this the shift to services based. Yeah, it it's you know, I get it, but at the same time, you do need I think steel is a great example because you can't call yourself an influential country of powerful if you cannot produce around steel. It's absolutely ludicrous, and it's one of those things that's so obvious that politicians don't get it. You know, these ideas are so obvious that somehow they're missed, and um, yeah, it just absolutely bonkers. So we've got about um 10 minutes left. I want to talk about UNITERRA. So this is kind of the latest chapter of your career. You've gone into uh it is a VC fund, but I think the way it describes itself, maybe a more granular way, is it's um circular circular economy investment, circular economy solutions to uh tackle climate change and regenerate biodiversity, I think is the tagline. Now, why why did you focus in on that subset in particular?
Costas:Because it's um it's it is closest to where I guess we as founders believe you can get some really necessary wins. And um because what it comes down to is becoming less pollutant. Um the the language of the industry, of course, is indeed biodiversity, climate change, big metrics, and you can very quickly get into a big debate on how dramatic is it, how non-dramatic is it. But if you bring it right down to let's pollute less, let's put less crap in the environment, whether it's in the air or in the ground or in the sea, um, you very quickly, from a, let's say, ethical point of view, get to some pretty like age-old truths, which is just be nice to your direct environment. Um, there is a brutally commercial side to it as well, which is and actually connected to many of the things we've spoken about before, which is if you can create a product which uses less energy to produce and less material to produce, which usually means there's less left after you've used it, then not only are you great for the planet, because you're basically just doing less of the stuff you don't want, the ugly stuff, but if you can keep the price point the same, you have a great commercial offer as well. And I think what we bring to the table here, which is sort of the when you look under the bonnet for any sort of the investors who are actually interested in going down this route with us, is it um it just made you you basically need a higher level, it's a genuine progress in the kinds of materials and products you're going to be investing in. Because all these big companies I've worked with, you could say we built a whole agency on the fact that they could never get their marketing and their and their RD production people to just work together on the same thing. They're very good at making better products more expensive and cheaper products worse. And what we're saying, there is a huge future for products that are both, let's say, cheaper or at least more commercially interesting and better. Um, and uh funnily enough, or no surprises, I should say, small businesses, I wouldn't say startups, because we do get in at a later stage, Series A, sort of early growth, is where we're interested, because then there's some revenue to proof us proof of concept. Uh, but they can crack that. So what we look for typically are it's probably mostly B2B solutions, even though we have a fantastic uh B2C product in the portfolio already. But we look for businesses who've understood where there is something really ugly happening in these industrial processes and there is an abundance of ugly shit happening, which you really don't want to have too much of, whether you are um, let's say, tied up to the uh UN sustainability goals or whether you're at COP 30. I mean, that that's not even relevant because there's some really polluting, ugly stuff happening in industry. And if you can show there is a Solution through a new material or a new process or a new catalyst that reduces that harmfulness while at the same time increasing performance, then of course that is a good thing to do. And the um, I mean, I I I love sort of being very um sort of dualist on this because I'm I'm as much a tree hugger as I am a tree hugger basher. Um, but there is a lot of commercial sense in doing this. Um, because no, this is not about degrowth. This is about the past 20, 30 years of being very lazy from the point of product development. There's always been development has always happened with this perception of abundance, infinite resources, infinite um uh, let's say, markets. And uh and I know there are some very influential people, even in my own uh say Twitter circle, who will say, well, that's the only way. Well, I think you should indeed have your energy uh say grid uh uh under control as a country. But if you look, for example, if you but if you look like culturally, which sits deeper than infrastructure in the uh the pace layering system, and you look, for example, at a country like Japan, who are very careful with their resources, because they're an island in a much more careful way than the UK as an island has ever been, then you actually see just being very conscious and cautious with the resources you have and squeezing the absolute last out of them before you start using, you could say, fresh uh and and virgin materials, then actually that might be a really good thing. There's probably a laffer curve hidden in there somewhere of um, yeah, uh and uh and I think this is a transition period which will take at least a generation, maybe two generations, before this really becomes embedded again. What I do hope is, and this is a hope, I have no way of uh making that more than just a hope, is if you look at um uh well, you could say how the whole industrial sort of base of Europe and the US has basically been uh exported to China. It is basically 90s technology which is being exported to China. When we sort of get the pace back up on just being a little more local and less levels, a little less depending on global supply chains, when we start getting our act in order again, I think there is a whole new sort of uh wave of opportunity from that uh uh point of view for more um energy conscious, waste conscious industrial, say, development. Um because also it's the only way this is going to be remaining interesting even for the younger generation. One of the big problems these old industrial giants have is no one wants to work for them. Um they're just so ugly and dirty and and backwards. So, but it's a slow process. And it and again, uh to make you may make the link back to your uh point on digital, everything in digital seems to be fast, but this world is slow, super slow, and it has to be slow because it's infinitely more complicated. If you took it, look at any product around you, like I had the uh the tennis ball in my hand just a moment ago, between me holding or being able to buy this tennis ball in a s in a shop and everything that came before, there's probably 200 different suppliers in here um doing something, but that takes so much time. Um, and it has to be a self-sort of organizing system that has to evolve. But uh it can be done. It can be done.
Sebastian:Yeah, I think it goes back to another concept, this concept of ergodicity, where yes, things in digital are fast because the cost of failure is very low. And this this concept of ergodicity of um, you know, you you can only win if you stay in the game. If you're eradicated from the game, you can't continue to bet. And when you're dealing with the physical world, manufacturing physical products, that the cost, you know, the approach you applicate, I think, bakes in ergodicity from the ground up because you're saying, look at the little changes you can make. Whereas, but conversely, if you want to do something new, if you want to do you know, new sector paradigm shift, shift, shift, shift the the pendulum back towards a new kind of form of industrial revolution in Europe and the West. That that's that's that's not something you know that you can fail fast at. There's this horrible fail fast and break things that came from Facebook, which I've I've always hated.
Costas:Even Oh god, and and it's not even a good idea, yeah, it's not even a good idea for Facebook.
Sebastian:No, it's not even as a software developer, I've always hated it. But um what I find really interesting from my point of view uh is I'm really excited about the potential for what you're talking about, linking in the the possibilities of um I know it gets an ugly word, people don't like it, but you know, genetic engineering, genetic multifacting, the the the boom in bio, and what might come in to allow industrialization to become more almost like microfactories or micro foundries to a certain extent, but also yeah, to just see absolute huge exponential gains in terms of waste. You know, talking about things like you know, like self-healing clothes, if a tear, taking, you know, inspiration from um, you know, and being able to last longer, or you know, cleaning products, things like that, things that can last longer, self-clean. I think there's gonna be loads of stuff like this coming up in the next 30, 40, 50 years. It's gonna be super, super fascinating. And I think tech will plateau out, you know. Sorry, we're not they use it with tech, digital will plateau out. You know, we we've we've gone through that S curve. And I do think we're due but a swing back towards a more physical world, and I think we're gonna see it.
Costas:Yeah, my hope, uh maybe one last point on the my hope, the uh the the because the digital demand its demand for electricity in particular its demand for energy is maybe a better way of saying it, is so beyond what the planet can uh currently just and by the planet, I don't mean some kind of fluffy uh gay uh sort of uh philosophical, this is literally our in our energy grids. Uh, but I do hope that will accelerate the things that have been dormant for way too long, which is development of nuclear. Uh, we've seen just recently in China, they finally got a thorium reactor to work. These literally, you could say the the better for planet uh narrative has actually stopped those critical developments from more efficient and cleaner energy point of view. Um, and I think that I that's what I hope is enough. People will understand, yeah, it's all you can all you can maybe find a unicorn in AI, but you'll have a pretty guaranteed revenue if you just focus on energy. Uh, because everyone's going to need it, both those who fail and succeed. Uh, that will see some within our lifetime still. Um I'm a little older than you are, but uh, I hope I'll see that sort of coming back so that at least the next generation can really enjoy it.
Sebastian:Um power science. Uh I think. Yeah, it's if it's a fast and easy win. I think that's another thing. I I you know, I don't want to go off on another tangent. I would love to spend another hour on this, but you know, the brain drain that the tech sector has created the digital sector has created, because you know, people going after these easy wins, quick valuations, you know, spin out another another app or another um um software as a service, you know, get a billion dollars before 30, a lot of the potential has been squandered that one might have gone into hard sciences. And what's interesting, I was talking to Emmanuel Derman a few episodes back who uh was uh started off in physics, uh, but ended up in Wall Street, had a very successful career in Wall Street. And I said, Well, how did you go from physics to Wall Street? I said, Well, at that time, the Cold War was coming to an end, and you saw massive, there'd been huge funding in the High Sciences because of a Cold War race. And you suddenly found a lot of PhDs with no job opportunities in traditional sectors. So a lot of them migrated to Wall Street and uh, you know, start applying it, and then the quant industry kind of came from that to a degree. Well, chicken and egg, you know, but the quant industry was was was perpetuated by that.
Costas:And it takes generations. This is a pendulum that goes way slower than people want to do, just we. Um, and that's just the way it is. Um, yeah, nothing to do about it. Fascinating.
Sebastian:Absolutely brilliant. We we're gonna have to wrap up now. We've hit our time limit. No, thank you. It's been wonderful. I think um minute for minute, um, in terms of pure ideas and things to go away in Google and learn more about. This has probably got more packed into it than any episode we've done. So thank you so much for all your brilliant ideas. Before we wrap up, anything you want to give a shout out to or mention? Um, we will publish links to all your books, of course, and and website and things like that. But uh any anything else coming up you want to mention?
Costas:Uh nothing specific, but maybe the the the the most unloved um innovation methodology or creativity methodology still out there is TRIZ. Have a look. T-R-I-Z. Uh it's a rabbit hole of weirdness, uh, but it will I that's one which also I hope will just become more popular again, uh like it once was in the 80s. Um amazing.
Sebastian:Maybe the uh pendulum will swing back to TRIS. Uh Costas, thank you so much. This has been fantastic. Thank you. Thank you. Thank you.