Innovation, simply defined, is the process that takes new ideas and implements them in a way that creates value. It’s not the same thing as invention, which is an event that occurs at a distinct point in time, often resulting in a single product. Innovation is the extension of invention, the act of bringing things that are invented to market, repeatedly.

The wonder drug for Korean startup growth, domestic hyper-consumerism, is pivotal in the development of the startup market and for this reason deserves a more in-depth analysis than the window dressing it normally receives.

For those new to this concept, Korean hyper-consumerism is the fixation on having the nicest and newest gadgets, clothing, etc. which is driven by the so-called “Keeping Up with the Kims” syndrome — a deeply embedded societal pressure and anxiety to never be outshone by anyone around you. Startups are able to leverage this as it provides a substantial demand function upon which to introduce their product to the market.

This blog will look at the origins of Korean hyper-consumerism and its current manifestation. It will conclude with a brief discussion on the role this currently plays in the startup world and its future potential iterations.

From the Ashes of the Asian Financial Crisis

One could argue that consumerism entered the Korean market back in the early 1980s as the economic policies set by General Park in the 1970s resulted in high levels of economic growth (with a major byproduct being the stronghold Samsung and friends have on the economy today). It was during this time that Korea had its first taste of real money as the economy boomed, people developed savings, and a pseudo-capitalistic economic structure took place (Korea was still in the throes of a military dictatorship which reverberated economically).

However, all of this was wiped out in 1997 with the Asian Financial Crisis. During this time (which you can read about here), Korea went from a strong 5.8% GDP growth rate in 1997 to -5.7% in 1998. The middle class was wiped out nearly overnight, there was a massive diaspora of Koreans moving abroad for work, and the Korean entertainment industry gave up on domestic demanding shifting its aspirations abroad.

Needless to say, things looked very grim.

Yet, through government intervention and partnerships with the IMF, Korea pulled an impressive 10.7% growth rate the following year and it is from here that Korean consumerism arose. It then evolved into hyper-consumerism with its growth continuing unabated — even during the most recent financial crisis (thanks buildup of foreign exchange reserves!). People were working again with money to spend, the dispersal of credit cards was a strong as ever, and the competition to have the best everything took hold.

While this is good and well, it does not say much. Most first world countries have money to spend and are quite competitive socially. What makes Korea so different?

The answer to this requires a look at what twenty years of growth have created.

The Beast Of Contemporary Korean Hyper-Consumerism

One of the first things you notice walking around Seoul is how everyone appears to wear only the flashiest name-brand clothing. This is because the story you must weave for those around you is one of flawless perfection — imperfection must not exist in society. Why would you wear last season’s clothing when you are surrounded by shopping. From ten-story department stores popping up in every open space in Seoul to even the metro acting as a platform for shopping — there is no escaping consumption.

This pressure does not just apply to personal fashion. Drive around Seoul and you will notice the dearth of used cars and the complete absence of used car dealerships. Similar to fashion, people must only be seen in the newest and nicest vehicles regardless of any financial strain it may place upon them. Keeping up appearances trumps financial soundness. You’d rather been in debt than risk being seen as behind the times.

What is often an overlooked aspect of this hyper-consumeristic drive is the penetration of coffee shops. Nearly one in every two buildings has a coffee shop. In fact,

[t]he number of chain and stand-alone coffee shops in South Korea [has] more than tripled to about 49,600 in 2015 from 12,400 in 2011…

And while Koreans do work some of the longest hours in the OECD, this fact is less functional and more derivative of a desire to consistently consume in every aspect of your life.

Go shopping. Purchase new clothes. Go to a coffee shop. Show off new clothes. Rinse. Repeat.

Another sign of being at the forefront of consumption is how outside society views the country. Is it seen as a bucolic country meant for a relaxing family vacation or one geared towards unbridled shopping?

Korean culture attracts a global audience that wants to consume Korea’s rich historical past but also its next level consumerism.

The workers at the beauty shops in the Myeondong District would not speak four different languages if there was not global demand for what Korea offers. The thing is, global demand does not come to fruition without the infrastructure being developed first via domestic demand. No country has created a consumeristic-driven industry that attracts global shoppers without first having a large local market.

From a financial standpoint, a telltale sign of a society that likes to consume is the dispersion of credit cards and Korea currently has one of the highest number of credit cards per household (“The Republic of Plastic Cards”) in the world. Additionally, its reliance on credit cards is so widespread that the country makes the least amount of payments in cash in the world with only 20% of payments being cash-based. This has resulted in one of the highest global levels of household debt in the world at 152% of disposable household income as of 2013. It does not matter if you cannot afford the newest fashion as long as you can just place it on your credit card and add it to your mounting level of debt.

Lastly, Korea has recently entered a new phase in this hyper-consumeristic rat race. It has evolved from mere competition for the finest clothes into the never-ending quest for aesthetic perfection. Billboards on the street, on the metro, on buses are lined with photos of beautiful women and messages that pronounce that you too can look this flawless if you just get plastic surgery. Why settle for regular eyes when you can have the perfect eyes.

Plastic surgery has exploded and changed from just getting your eyelids fixed or jaw shaved to now include just about any and every possible surgery. This industry has sprung up basically overnight. Much like with shopping, the pervasive nature of plastic surgery now brings in global medical tourist whose sole purpose in coming to Korea is plastic surgery.

The Future, More of the Same

Despite the Korean economy slowing down with the major source of growth, the chaebols, struggling to keep pace on the global market and increasing unemployment, the beast that is hyper-consumerism will not be going anywhere for a long time. It survived the 2008 financial crisis so unless another crippling economic attack a la Asian Financial Crisis occurs, there is some military engagement on the Korean Peninsula, or some Black Swan event, there is not much that can stop this.

While this is awful news for credit card debt and savings in Korea, this is excellent news for startups entering the Korean market. The exponential demand curve that they have learned to grow and love for product development and user growth will remain consistent. However, this will be a double-edged sword as they might fall into the trap of becoming too comfortable in the Korean market and plateau cutting off any chance at globalization. This loop is something Korea must avoid but will continue to fall into its trap as the low hanging fruit is just too temping. Although, for foreign startups, you’d be remiss to not give Korea a try.

About the Author

This submitted article was written by Alex Gershon.

From a managerial perspective, very few ideas are more important than the dynamics of motivation. Understanding what moves employees toward efficiency and fulfillment is at the core of any manager’s responsibilities. Motivation in the workplace is primarily concerned with improving employees’ focus, often through pursuing positive incentives and avoiding negative ones.

Theories of motivation are of course rooted in psychology. An individual must direct their attention toward a task, generate the necessary effort to achieve that task, and persist in working toward it despite potential distractions. Various theories have attempted to identify the factors that contribute to effective employee motivation, most of which are easily divided into four broad categories:

• Needs-oriented theories
• Cognition-oriented theories
• Behavior-oriented theories
• Job-oriented theories

Needs-Oriented Theories

At its most basic, motivation can be defined as the fulfillment of various human needs. These needs can encompass a range of human desires, from basic, tangible needs of survival to complex, emotional needs surrounding an individual’s psychological well-being.

Hierarchy of Needs

The most well-known example of a needs-oriented theory of motivation is Maslow’s Hierarchy of Needs. Maslow postulated that needs should be fulfilled in a particular scaffolded order, with food, water, and shelter in the bottom, most fundamental two tiers and intangible needs such as fulfillment, self-esteem, and a sense of belonging in the upper three tiers. While this framework makes a certain amount of logical sense, critics have noted that there have been minimal data that suggest employees strive to satisfy needs in the workplace in accordance with this hierarchical framework. But the fundamental idea behind Maslow’s model is that individuals have various tangible and intangible desires that can be leveraged in the use of motivational incentives.

Maslow’s Hierarchy of Needs: Maslow’s Hierarchy of Needs postulates that need must be fulfilled in a hierarchical order, from basic needs such as food and water to more intangible needs such as self-esteem and a sense of belonging.

Need for Achievement Theory

Atkinson and McClelland proposed the Need for Achievement Theory, which highlights three particular needs in the context of the workplace: achievement, authority, and affiliation. Atkinson and McClelland hypothesized that every individual has a need for all three of these intangible segments of fulfillment but that most individuals lean more toward one of the three. For example, a salesman with a quota to fulfill would be best paired with an achievement-oriented manager, as such a goal-oriented approach toward, for example, a specific number of sales would be highly motivating.

Cognition-Oriented Theories

Cognition-oriented theories generally revolve around expectations and deriving equitable compensation for a given effort or outcome. There are two main cognition-oriented theories: equity theory and expectancy theory.

Equity Theory

Equity Theory is based on the basic concept of exchange. It values the culmination of employee experience, skills, and performance against their respective compensation and advancement opportunities.

Expectancy Theory

Expectancy Theory is similarly derived, but it states this relationship through an equation: Motivation = Expectation (Σ Instrumentality × Valence ). Instrumentality simply refers to the belief that a level of performance will result in a level of outcome; valence refers to the value of that outcome.

Essentially, Expectation Theory and Equity Theory demonstrate the value of rewarding an employee’s investment of time and effort with appropriate compensation.

Behavior-Oriented Theories

The underlying concept of behavioral approaches to motivation is rooted in theories of “conditioning,” particularly the work of psychologist B.F. Skinner. Behaviorism stipulates that an employer should promote positive behavior and deter negative behavior, generally through a basic rewards system. Variable compensation, as found in many sales jobs, is a prime example of this concept. When an employee makes a sale, the employer provides a certain portion of income to the employee that executed that sale. This positive reinforcement serves as a behavior modifier, motivating the employee to repeat this behavior and make more sales.

Job-Oriented Theories

Job-oriented theories adhere to the view that employees are motivated to complete tasks effectively because of an innate desire to be fulfilled or to contribute and that compensation and other forms of incentives are less important to them.

Two-Factor Theory

Frederick Herzberg’s Two-Factor Theory is the most well known of the job-oriented theories, despite the fact that it has not been supported by empirical evidence. Herzberg states that salary, benefits, status, and other tangible benefits for employees can only reduce dissatisfaction and that intangibles—such as autonomy, natural interest, recognition, and the responsibility of the work itself—are the true basis of motivation.

Work Engagement Theory

Other theories, such as Work Engagement Theory, similarly propose that intellectually fulfilling and emotionally immersive work is the foundation of a motivated workforce.

Clearly, our understanding of workplace motivation could benefit from further research and empirical analysis. But the variety of theories also highlights the fact that people can be motivated by different things in different circumstances. Effective organizational management requires an understanding of these theories as well as of their possible limitations.

About the Author

This article is produced by Boundless.com. See more.

In Capital in the Twenty-First Century Thomas Piketty among other things traced the history of the distribution of income between those whose income is derived from capital and those whose income is derived from other sources, notably labour, and forecast that in the absence of shocks such as world war or economic depression this distribution was likely to become more and more unequal in the future.

Unless all individuals derive their income from capital and labour in equal proportions, which in practice is never the case, this implies that the distribution of income between individuals too will become more and more unequal. This in turn implies that the distribution of wealth between individuals will become more and more unequal, unless those whose income is derived from capital as opposed to other sources save a lower proportion of it, which is hardly ever the case.

Such evidence as is available, and there is a lot more than there was even as short a time ago as ten years, suggests that in most countries the distribution of wealth between individuals became more and more unequal between the eighteenth century and 1913 and less and less unequal between 1913 and the 1970s, and that it has become more and more unequal between the 1970s and the present time.

The distribution of wealth between individuals is everywhere much more unequal than the distribution of income, with a Gini coefficient in the countries for which it has been calculated currently averaging about 0.65. Is such a high and currently increasing inequality in the distribution of wealth sustainable?

It is commonly believed that there is a positive correlation between inequality and economic growth, a belief exemplified in the title of Arthur Okun’s book Equality and Efficiency: The Big Trade-Off. The basis of this belief is the view that a greater degree of inequality provides a greater incentive for those responsible for economic growth to exert themselves.

Since it is conceivable that people are more interested in their absolute income and wealth than in their relative income and wealth, it could be argued that they will accept increasing inequality provided that economic growth is fast enough for their absolute income and wealth to grow.

However, the belief that at there is a positive correlation between inequality and economic growth is misguided. There are both theoretical and empirical reasons for rejecting it.  

It is true that here are a number of theoretical reasons for thinking that more inequality promotes economic growth. For example, where there is relatively great inequality large set-up costs will be easier to meet, the savings of the rich will provide more funds for investment, and the poor will lack the resources, such as education, needed to disrupt economic activity effectively, even if they wished to do so.

However, there are also a number of theoretical reasons for thinking that more inequality hampers economic growth. For example, credit market imperfections particularly affecting the poor will reduce their ability to contribute to economic growth, remedial transfer payments and the associated tax finance will distort economic decisions, as will lobbying activities by the rich to prevent such redistribution, and socio-political unrest will reduce productivity.

There is no a priori reason to believe that either one of these sets of influences dominates the other.

Quite a number of empirical studies have sought to determine whether or not there is a correlation between inequality and economic growth. Most of these studies have come to the conclusion that the answer depends on circumstances, such as whether the country is rich, middle-income or poor, or within a country, whether the question relates to high income people or to low income people. On balance, the empirical evidence suggests that if anything the correlation between inequality and economic growth is negative.

So a capitalist economy is not faced with the dilemma that it must choose between inequality and low economic growth.

However, perceived inequality in the distribution of income and wealth may have been one of the reasons why in 2016 so many in two countries voted for radical political change, the British voting for ‘Brexit’ and the Americans voting for Donald Trump as President.

And if the distribution of income and wealth between individuals becomes more and more unequal in the future, as Piketty’s analysis indirectly implies, the survival of capitalism is called into question.

About the Author

This article was produced by Edward Elgar Publishing‘s blog which is filled with debate, news, updates and views from their authors and their readership. see more.

With a healthy dose of curiosity and openness, four healthcare VCs shared a deeper level of what life as a VC is really like. I moderated this interesting panel — including Dr. Juan Cueva (Applied Ventures), Liz Rockett (Kaiser Permanente Ventures), Tom Egan (Optum Ventures), and Yizhen Dong (11.2 Capital) — in front of an audience of 30 Berkeley students. Some attendees asked burning questions about their dream job, while others enjoyed a crash course on the world of venture capital. I myself left with lessons that built upon what I learned in my past role in healthcare VC at OCA Ventures. It was my pleasure to moderate such an interesting and talented panel, and I wanted to share this six-section summary with those who may be interested. Enjoy!

1. What they liked about their jobs…

They learn about cool things. Inherently VCs invest in disruptive technologies with significant growth potential. Much of their week is spent learning and staying curious about cutting-edge technologies that are applied to various critical healthcare problems.

They meet smart, down to earth founders. VCs regularly meet highly-accomplished and highly-competent founders. These founders are not only very bright, but they are also down to earth. They do not have a chip on their shoulder and take the time to explain deeply technical concepts in a non-threatening way.

2. What they were unpleasantly surprised with about their jobs…

They can feel like a lone wolf. VCs eat what they kill, and they face both external and internal competition. VCs compete with folks externally, those outside their firm, and internally, for their fund’s limited time and resources. While colleagues, LPs, and advisors are willing to help, it is typically after their personal to-do lists are complete. An exception, however, is the relationship between a junior VC and a senior VC.

They spend a lot of time negotiating. Being a VC is all about deal making — before, during, and after an investment is made. So naturally, VCs must negotiate to get the most favorable outcomes. This, however, can be taxing and potentially even distracting from other important parts of the job.

They deal with failure often. Various reports exist on the mortality rate of startups, and for that matter, VC firms themselves. However, VCs believe very strongly in the upside potential of their portfolio companies; their dedication is sometimes even compared to that of a parent-child relationship! When the weather is stormy and the startup they invested in is not doing well — which can often be the case — coping is a challenge.

3. What they do to manage very ambitious ideas…

They build in dissenting views. The benefit of being a lone wolf is that there is a higher burden of proof to make decisions. This forces VCs to not make bets on phony science, teams, and business models. Beyond leveraging formal and informal expert opinions, one VC calls on a “red team” to provide an unbiased opposing view.

They keep an open mind. Like a (in)famous person said, “Healthcare is complicated.” So, while some ideas may be overly-ambitious, others may just work with effective execution. VCs oftentimes miss big opportunities by being too skeptical, so keeping an open mind can allow them to see signal in what appears to be noise.

They rely on storytelling to bring others along. Stories, more than data, can build emotional connection; therefore, VCs use stories to get buy in for ideas that on the surface seem audacious. A good story can be the difference between a moonshot’s success and failure.

4. How they do well and good…

They use their independence to invest in what they are passionate about.Another benefit of being a lone wolf is that VCs can focus their personal investment theses on what matters to them. Social impact can be an important part of the business, and VCs are free to invest in companies whose mission they are passionate about, so long as it makes sense financially.

5. What they do to be informed…

They read. VCs read a lot. Simple. Whether it is popular news, niche news, opinion pieces, or research — much of their time is spent reading.

They listen to others and build a band of supporters. VCs build both formal and informal expert networks that they can call on to find and vet deals and to help their portfolio companies. They attend many events and spend time with founders. Active listening and pattern recognition are critical skills.

6. How corporate venture capitalists (CVCs) operate…

They all are different. All CVCs look different — from LP structure to connectedness with their parent company. Some have evergreen funds that replenish each year, while others need to fundraise internally on a recurring basis, and others appeal for funding off the balance sheet for each deal. Some get investment from outside the business, while others have only one LP — the parent company. Some are only operationally and commercially connected by name, while others are specifically set up for portfolio companies to sell into the parent company.

About the Author

This article was written by Harry Goldberg, of Beyond HealthTech and BioTech startups and VC. Harry spends his time as a Berkeley MBA/MPH and a WEF Global Shaper.

Investments in the Internet of Things are an important element of the fourth industrial revolution. The real fuel of future economy will be data resources. Information collected by many smart objects will change the landscape both in the financial industry and in the whole industry.

When we interact with objects connected to the network, and these items have the ability to communicate in real time, we deal with the IoT. In this networked structure, there is a space for humans, although some people defines IoT as a network of relations only between machines. The Internet of Things alongside Blockchain, artificial intelligence is one of the most frequently changed concepts in the context of the 4th industrial revolution.

IoT in numbers:

· 10–15 trillion — by 2030, this is how much the contribution of the IoT to global GDP will be. For comparison, more or less the current GDP of one of the world’s largest economies (China) (source: General Electric);

· 75 percent cars manufactured by 2020 will be connected to the IoT network (source: Business Insider);

· 62 billion dollars — this is how much global consumer spending related to the Internet of Things in 2018 (source: IDC).

According to the IDC research company, the global investments in this segment are expected to reach 772.5 billion dollars. According to the same company, the number of smart devices connected to the network in 2020 will be 4 times higher than the estimated value for the Earth population for this period.

The number of objects will reach over 30 billion (in 2020). The dynamic development of new, innovative technologies and the huge amount of data provided via the IoT will have an impact on the financial sector.

The fuel of the Internet of Things

We can compare Internet of Things to the infrastructure that is used to collect and distribute huge data sets. Without big data, there would be no IoT and vice versa. These two areas are the foundation of industry 4.0. Over a dozen of billion objects connected to the network generate a lot of information requiring structured analysis. IDC estimates that spending on analytics of IoT data will grow by an average of 30 percent on an annual basis. Companies still have a problem with the effective use of these resources. Problems are reflected in the conclusion from the Gartner report — the company is claiming a failure of almost 60 percent projects related to big data.

Although most initiatives seeks to monetize data sets will not bring the expected results, the development of the Internet of Things and the increase of big data global resources is inevitable. E.g. Los Angeles used traffic monitoring sensors to automate the management of traffic lights. Traffic jams have decreased by over 16 percent in this way. One of the IoT projects with the greatest momentum is the Korean smart city Songdo, which is a hundreds of hectares of intelligent city designed and built from scratch. In this city, for example, an intelligent water management system was used and even sensors in car registrations that would turn off the main beam if they did not detect other vehicles involved in the traffic.

How the Internet of Things can affect the credit, insurance and loans market?

According to the IDC report, expenditures on the IoT will grow the fastest in the area of household appliances (52 percent), vehicles (48 percent) and smart buildings (34 percent). These areas are at first glance not related to the credit sector. Deloitte analysts draw scenarios in which data collected by smartphones, refrigerators, smart watches, and televisions can be used, for example, by loan companies to analyze creditworthiness. Already, the analysis of our activity in social media helps in the processing of loan applications. Social scoring is not a common method, but with the development of IoT, the data can be so accurate that this assessment model will become the backbone of a reliable verification of a potential borrower. Especially if he or she does not have a credit history yet, and his

The IoT can also improve the optimization of internal processes in companies. Sensors will help to analyze the mutual relations between employees and the conditions in offices that are conductive to greater efficiency.

The insurance sector can also benefit from the implementation of intelligent cars equipped with sensors that monitor drivers’ driving style. At the moment, the data on how a given driver brakes, speeds up or does not exceed the permitted speeds, is collected by applications, so they are not assigned to a specific car.

Smart houses packed with sensors will revolutionize the real estate insurance sector. The companies will be able to use information on the use of the apartment to precisely determine risks to which the property is exposed. They will be able to analyze if a flat is often smoked, which may be a threat to fire. IT is not difficult to imagine also sensors monitoring the gas system at home. If there is any damage, it may affect the increase of the real estate insurance premium.

These are just a few examples about the direction in which the Internet of Things will push financial sector. The dynamic development of IoT may also lead to the implementation of solutions that go beyond the imagination of analysts.

The fourth revolution will leave its mark on the financial industry.

About the Author

This article was written by Dawid Wiktor, Founder, CEO and CTO @ Inspire, Polish Ministry of Digital Affairs and cryptocurrencies investor.

Most employees do not find the time to practice self-reflection. As a consequence, they are unaware about their personality and needs. By asking the right questions, a psychotherapist helps employees understand their minds and guides them towards self-awareness. Frequent self-awareness therapy increases resilience and productivity while also reducing sick days. Both result in a positive return on investment. Bonus: You follow the footsteps of companies like Google and SAP.

2014 was one of the hardest years of my life. End of April that year, I decided to quit my job at the company I had co-founded with four friends. This decision was followed by a six months long debate on the deal that finally resulted in me selling all my shares back to the remaining team. For all of us founders, as well as for our friends and family, this process cost time and nerves, and eventually our friendship. Here’s how I usually tell people what happened: our company was operating in two entirely different markets (Germany and Oman). I believed the better strategy was to first win one of these markets, before launching the international expansion. The rest of the team did not agree with this opinion, so I left. End of story.

Here’s what actually happened: our team was wonderfully complementary with regards to our technical skills. We had a culture of open feedback and were all driven to make our entrepreneurial dream become reality. What was our problem? While we all shared a getting-things-done-mentality, two of us, myself included, were also driven by a need for power. At the time, I clearly lacked the self-awareness to see how our personalities turned discussions from a search for the right answer into a struggle for power.

My story is not an isolated case. Everyday, teams that seemingly operate under perfect conditions break up. On the one hand, this is extremely stressful for the individuals involved. On the other hand, the apparent productivity loss kills effectivity and results in high financial damage. I am certain that these negative effects can either be minimized, or team break-ups might even be averted by self-awareness therapy: self-awareness refers to an individual’s introspective ability to recognize their personality and needs (inner self-awareness) as well as understanding how they relate to others and their perspectives (external self-awareness). Teams risk running into the same trap as my former team if their members lack either component of self-awareness. Yet, while a large body of research emphasizes the importance of a team’s personality composition, often this factor is naively overlooked during the romanticized forming and storming phases of launching a company or project. As a result, founders, as well as managers, neither know how their co-founders’ and employees’ minds function, nor do they understand their own.

Current state of self-awareness

I interviewed founders, employees, workplace health managers, as well as therapists to understand the level of self-awareness in the workplace. Their thoughts translate into three needs:

1. Diagnosis: individuals seek a way to understand their own personality and needs, as well as the minds of their employees and peers
2. Intervention: managers feel overwhelmed with researching and offering the right “therapy” for their teams
3. Evaluation: while the intuitive benefit of therapy is clear to most, they question the numerical return of investment

Many founders and team leads overlook that a professional therapist can make the right diagnosis and recommend an appropriate intervention that will have measurable impact. Let’s discuss these dynamics in detail.

1. Diagnosis: How to understand your team’s personalities?

Organizational psychologist Tasha Eurich found that almost all of us think we are self-aware. In fact, only 10–15% actually are. Naturally, it won’t be easy to find out for yourself if you are one of these rare self-awareness “unicorns”. Some refer to more or less scientific tests to assess their mental state. Others read one self-help book after another, in search of enlightenment. In any case, you will have a hard time cutting through the immense number of psychometric tests and self-assessment manuals without any professional guidance. Ultimately, “you won’t [know and you won’t] change just by reading a book.” And your employees won’t either.

“Your friends, family, and colleagues, they all follow their own agenda.”

Seeking a therapist’s advice instead, is the first step towards collective organizational self-awareness. Not only can therapists assist you in selecting the right psychometric tool, they can also provide a more scientific interpretation of the results. As one management coach put it: “Your friends, family, and colleagues, they all follow their own agenda. They project their own ambitions, goals, fears, and an entire history they share with you into their advice. Only an outsider can provide a truly objective perspective.” Surely, you should always value your peers’ opinion. Still, a therapist will provide a very useful outsider’s view. Apart from seeking a therapist’s advice for yourself, you should also send each employee to therapy. This will provide them with the opportunity to openly — without the fear of being judged — learn about and discuss their needs. Furthermore, it helps employees to seek tasks they excel in and more honestly mention personal motivations behind their arguments.

Self-awareness therapy encourages you to think about the right questions at the right time.

2. Intervention: What is the right therapy?

Maybe your company already offers yoga sessions, weekly massages, or mindfulness meditation for employees. This is great! No doubt, these “relaxation exercises” act as an outlet for the already stressed part of your workforce. Yet, their impact on everyone’s self-awareness, and thus on actually solving apparent issues, is unclear: The Guardian author Steven Poole criticizes that the concept of modern mindfulness interventions is in fact “opposed to deep thinking”. While the purpose of mindfulness meditation is to teach you how to “let thoughts come and go” (Headspace), self-awareness therapy instead encourages you to think about the right questions at the right time. For example: “What are your biggest failures and what commonalities exist between them?” (Taken from Tasha Eurich’s Insight.) In fact, self-awareness therapy is so powerful because it caters to your employees’ desire to better understand their inner state. Reflecting on your personality and behavior helps you understand why something makes you uneasy, and how you might address the negative feeling. This will not only improve your mental wellbeing and sanity. Openly addressing weaknesses will increase your own and your peers’ productivity, as Bridgewater Founder Ray Dalio teaches us in his recent book Principles. Consider self-awareness therapy a preventive health measure with a direct impact on productivity.

Beyond the preventive benefits, a first conversation with a therapist also acts as a unique access to treatment for those affected by distress and mental illnesses. The conversation encourages employees to express issues that they do not dare to discuss with friends or colleagues. This is one of the reasons a researcher from Charité Berlin, Europe’s largest university clinic, recommends therapy for literally everyone: the first session is the most important step towards betterment. Taken from there, the therapist can confidentially funnel the affected to treatment, without them having to fear stigmatization and help the healthy to better understand their personality and behavior.

In summary, providing employees with access to self-awareness therapy will not only result in a more reflected and effective workforce, it will also contribute to the overall health of your teams. This will in turn have a strong impact on your company goals.

3. Evaluation: Which impact can you expect?

As a team of researchers from the London School of Economics (LSE) reports, already the promotion of general well-being in the workplace reduces the hours of presenteeism (being at work while sick) and absenteeism (habitual absence from work). They predicted productivity gains of more than £350,000 (ca. $490,000) for a company with 500 employees. Similarly,meQuilibrium, a provider of resilience trainings, reports yearly returns of more than $1,000 per employee linked to a 16% increase in resilience.

Self-awareness helps identifying management blind spots, accepting personal weaknesses, and motivates improvement.

These numbers are equally impressive for self-awareness trainings: an analysis by recruitment firm Korn Ferry demonstrated that companies led by more self-aware managers show higher rates of return than their competitors with less aware leaders. This ties to the concept of personal evolution that Ray Dalio endorses in Principles: self-awareness helps identifying management blind spots, accepting personal weaknesses, and motivates improvement.

Following these arguments, 77% of US human resource professionals promote Employee Assistance Programs (EAPs) (Wikipedia has a good definition of EAPs). Yet, just like the relaxation exercises referenced above, EAPs often concentrate on curing symptoms such as stress, instead of focusing on the the promotion of self-awareness and thereby the prevention of mental health issues. This is why companies like Google and SAP provide their workforce with a more extensive battery of mindfulness as well as self-awareness programs.

Smaller players, however, are overwhelmed by the immense number of therapists and other providers promising the effects of their various interventions. Many startups raise concerns that they are too tight on budget to afford offering a 24/7 service or hiring a full-time therapist. One workplace health lead I interviewed boils the issue down to its essence: there needs to be a central platform providing quality checks and convenient booking of the right employee therapy.

Drawing from the present academic insights and my own data, I believe that such a platform could not only simplify the booking process. It would further encourage a cross-company understanding for the importance of mental health interventions at the workplace. By assisting firms of any size to find a measurable self-awareness therapy that is tailored to their needs, we can reform workplace interaction and employee mental health.
Sharpist will be the first platform of this kind. If your team’s wellbeing and productivity is something important to you that you want to work on with measurable insights, reach out: sharpist.org.

Thank you to all the Oxford friends and family, who contributed reviewing my thoughts. Also thanks to my former co-founders for providing me with this valuable learning. I wish you all the best of luck on your future journey.

Disclaimer: I understand that the term “therapy” technically refers to the treatment of sickness symptoms. However, I agree with some researchers’ opinion that most preventive treatments are in fact therapeutic.

About the Author

This article was written by Hendrik Schriefer, Experimental Psychologist and Co-Founder of Sharpist. See more.

In Capital in the Twenty-First Century Thomas Piketty among other things traced the history of the distribution of income between those whose income is derived from capital and those whose income is derived from other sources, notably labour, and forecast that in the absence of shocks such as world war or economic depression this distribution was likely to become more and more unequal in the future.

Unless all individuals derive their income from capital and labour in equal proportions, which in practice is never the case, this implies that the distribution of income between individuals too will become more and more unequal. This in turn implies that the distribution of wealth between individuals will become more and more unequal, unless those whose income is derived from capital as opposed to other sources save a lower proportion of it, which is hardly ever the case.

Such evidence as is available, and there is a lot more than there was even as short a time ago as ten years, suggests that in most countries the distribution of wealth between individuals became more and more unequal between the eighteenth century and 1913 and less and less unequal between 1913 and the 1970s, and that it has become more and more unequal between the 1970s and the present time.

The distribution of wealth between individuals is everywhere much more unequal than the distribution of income, with a Gini coefficient in the countries for which it has been calculated currently averaging about 0.65. Is such a high and currently increasing inequality in the distribution of wealth sustainable?

It is commonly believed that there is a positive correlation between inequality and economic growth, a belief exemplified in the title of Arthur Okun’s book Equality and Efficiency: The Big Trade-Off. The basis of this belief is the view that a greater degree of inequality provides a greater incentive for those responsible for economic growth to exert themselves.

Since it is conceivable that people are more interested in their absolute income and wealth than in their relative income and wealth, it could be argued that they will accept increasing inequality provided that economic growth is fast enough for their absolute income and wealth to grow.

However, the belief that at there is a positive correlation between inequality and economic growth is misguided. There are both theoretical and empirical reasons for rejecting it.  

It is true that here are a number of theoretical reasons for thinking that more inequality promotes economic growth. For example, where there is relatively great inequality large set-up costs will be easier to meet, the savings of the rich will provide more funds for investment, and the poor will lack the resources, such as education, needed to disrupt economic activity effectively, even if they wished to do so.

However, there are also a number of theoretical reasons for thinking that more inequality hampers economic growth. For example, credit market imperfections particularly affecting the poor will reduce their ability to contribute to economic growth, remedial transfer payments and the associated tax finance will distort economic decisions, as will lobbying activities by the rich to prevent such redistribution, and socio-political unrest will reduce productivity.

There is no a priori reason to believe that either one of these sets of influences dominates the other.

Quite a number of empirical studies have sought to determine whether or not there is a correlation between inequality and economic growth. Most of these studies have come to the conclusion that the answer depends on circumstances, such as whether the country is rich, middle-income or poor, or within a country, whether the question relates to high income people or to low income people. On balance, the empirical evidence suggests that if anything the correlation between inequality and economic growth is negative.

So a capitalist economy is not faced with the dilemma that it must choose between inequality and low economic growth.

However, perceived inequality in the distribution of income and wealth may have been one of the reasons why in 2016 so many in two countries voted for radical political change, the British voting for ‘Brexit’ and the Americans voting for Donald Trump as President.

And if the distribution of income and wealth between individuals becomes more and more unequal in the future, as Piketty’s analysis indirectly implies, the survival of capitalism is called into question.

About the Author

This article was produced by Edward Elgar Publishing‘s blog which is filled with debate, news, updates and views from their authors and their readership. see more.

With a healthy dose of curiosity and openness, four healthcare VCs shared a deeper level of what life as a VC is really like. I moderated this interesting panel — including Dr. Juan Cueva (Applied Ventures), Liz Rockett (Kaiser Permanente Ventures), Tom Egan (Optum Ventures), and Yizhen Dong (11.2 Capital) — in front of an audience of 30 Berkeley students. Some attendees asked burning questions about their dream job, while others enjoyed a crash course on the world of venture capital. I myself left with lessons that built upon what I learned in my past role in healthcare VC at OCA Ventures. It was my pleasure to moderate such an interesting and talented panel, and I wanted to share this six-section summary with those who may be interested. Enjoy!

1. What they liked about their jobs…

They learn about cool things. Inherently VCs invest in disruptive technologies with significant growth potential. Much of their week is spent learning and staying curious about cutting-edge technologies that are applied to various critical healthcare problems.

They meet smart, down to earth founders. VCs regularly meet highly-accomplished and highly-competent founders. These founders are not only very bright, but they are also down to earth. They do not have a chip on their shoulder and take the time to explain deeply technical concepts in a non-threatening way.

2. What they were unpleasantly surprised with about their jobs…

They can feel like a lone wolf. VCs eat what they kill, and they face both external and internal competition. VCs compete with folks externally, those outside their firm, and internally, for their fund’s limited time and resources. While colleagues, LPs, and advisors are willing to help, it is typically after their personal to-do lists are complete. An exception, however, is the relationship between a junior VC and a senior VC.

They spend a lot of time negotiating. Being a VC is all about deal making — before, during, and after an investment is made. So naturally, VCs must negotiate to get the most favorable outcomes. This, however, can be taxing and potentially even distracting from other important parts of the job.

They deal with failure often. Various reports exist on the mortality rate of startups, and for that matter, VC firms themselves. However, VCs believe very strongly in the upside potential of their portfolio companies; their dedication is sometimes even compared to that of a parent-child relationship! When the weather is stormy and the startup they invested in is not doing well — which can often be the case — coping is a challenge.

3. What they do to manage very ambitious ideas…

They build in dissenting views. The benefit of being a lone wolf is that there is a higher burden of proof to make decisions. This forces VCs to not make bets on phony science, teams, and business models. Beyond leveraging formal and informal expert opinions, one VC calls on a “red team” to provide an unbiased opposing view.

They keep an open mind. Like a (in)famous person said, “Healthcare is complicated.” So, while some ideas may be overly-ambitious, others may just work with effective execution. VCs oftentimes miss big opportunities by being too skeptical, so keeping an open mind can allow them to see signal in what appears to be noise.

They rely on storytelling to bring others along. Stories, more than data, can build emotional connection; therefore, VCs use stories to get buy in for ideas that on the surface seem audacious. A good story can be the difference between a moonshot’s success and failure.

4. How they do well and good…

They use their independence to invest in what they are passionate about.Another benefit of being a lone wolf is that VCs can focus their personal investment theses on what matters to them. Social impact can be an important part of the business, and VCs are free to invest in companies whose mission they are passionate about, so long as it makes sense financially.

5. What they do to be informed…

They read. VCs read a lot. Simple. Whether it is popular news, niche news, opinion pieces, or research — much of their time is spent reading.

They listen to others and build a band of supporters. VCs build both formal and informal expert networks that they can call on to find and vet deals and to help their portfolio companies. They attend many events and spend time with founders. Active listening and pattern recognition are critical skills.

6. How corporate venture capitalists (CVCs) operate…

They all are different. All CVCs look different — from LP structure to connectedness with their parent company. Some have evergreen funds that replenish each year, while others need to fundraise internally on a recurring basis, and others appeal for funding off the balance sheet for each deal. Some get investment from outside the business, while others have only one LP — the parent company. Some are only operationally and commercially connected by name, while others are specifically set up for portfolio companies to sell into the parent company.

About the Author

This article was written by Harry Goldberg, of Beyond HealthTech and BioTech startups and VC. Harry spends his time as a Berkeley MBA/MPH and a WEF Global Shaper.

Investments in the Internet of Things are an important element of the fourth industrial revolution. The real fuel of future economy will be data resources. Information collected by many smart objects will change the landscape both in the financial industry and in the whole industry.

When we interact with objects connected to the network, and these items have the ability to communicate in real time, we deal with the IoT. In this networked structure, there is a space for humans, although some people defines IoT as a network of relations only between machines. The Internet of Things alongside Blockchain, artificial intelligence is one of the most frequently changed concepts in the context of the 4th industrial revolution.

IoT in numbers:

· 10–15 trillion — by 2030, this is how much the contribution of the IoT to global GDP will be. For comparison, more or less the current GDP of one of the world’s largest economies (China) (source: General Electric);

· 75 percent cars manufactured by 2020 will be connected to the IoT network (source: Business Insider);

· 62 billion dollars — this is how much global consumer spending related to the Internet of Things in 2018 (source: IDC).

According to the IDC research company, the global investments in this segment are expected to reach 772.5 billion dollars. According to the same company, the number of smart devices connected to the network in 2020 will be 4 times higher than the estimated value for the Earth population for this period.

The number of objects will reach over 30 billion (in 2020). The dynamic development of new, innovative technologies and the huge amount of data provided via the IoT will have an impact on the financial sector.

The fuel of the Internet of Things

We can compare Internet of Things to the infrastructure that is used to collect and distribute huge data sets. Without big data, there would be no IoT and vice versa. These two areas are the foundation of industry 4.0. Over a dozen of billion objects connected to the network generate a lot of information requiring structured analysis. IDC estimates that spending on analytics of IoT data will grow by an average of 30 percent on an annual basis. Companies still have a problem with the effective use of these resources. Problems are reflected in the conclusion from the Gartner report — the company is claiming a failure of almost 60 percent projects related to big data.

Although most initiatives seeks to monetize data sets will not bring the expected results, the development of the Internet of Things and the increase of big data global resources is inevitable. E.g. Los Angeles used traffic monitoring sensors to automate the management of traffic lights. Traffic jams have decreased by over 16 percent in this way. One of the IoT projects with the greatest momentum is the Korean smart city Songdo, which is a hundreds of hectares of intelligent city designed and built from scratch. In this city, for example, an intelligent water management system was used and even sensors in car registrations that would turn off the main beam if they did not detect other vehicles involved in the traffic.

How the Internet of Things can affect the credit, insurance and loans market?

According to the IDC report, expenditures on the IoT will grow the fastest in the area of household appliances (52 percent), vehicles (48 percent) and smart buildings (34 percent). These areas are at first glance not related to the credit sector. Deloitte analysts draw scenarios in which data collected by smartphones, refrigerators, smart watches, and televisions can be used, for example, by loan companies to analyze creditworthiness. Already, the analysis of our activity in social media helps in the processing of loan applications. Social scoring is not a common method, but with the development of IoT, the data can be so accurate that this assessment model will become the backbone of a reliable verification of a potential borrower. Especially if he or she does not have a credit history yet, and his

The IoT can also improve the optimization of internal processes in companies. Sensors will help to analyze the mutual relations between employees and the conditions in offices that are conductive to greater efficiency.

The insurance sector can also benefit from the implementation of intelligent cars equipped with sensors that monitor drivers’ driving style. At the moment, the data on how a given driver brakes, speeds up or does not exceed the permitted speeds, is collected by applications, so they are not assigned to a specific car.

Smart houses packed with sensors will revolutionize the real estate insurance sector. The companies will be able to use information on the use of the apartment to precisely determine risks to which the property is exposed. They will be able to analyze if a flat is often smoked, which may be a threat to fire. IT is not difficult to imagine also sensors monitoring the gas system at home. If there is any damage, it may affect the increase of the real estate insurance premium.

These are just a few examples about the direction in which the Internet of Things will push financial sector. The dynamic development of IoT may also lead to the implementation of solutions that go beyond the imagination of analysts.

The fourth revolution will leave its mark on the financial industry.

About the Author

This article was written by Dawid Wiktor, Founder, CEO and CTO @ Inspire, Polish Ministry of Digital Affairs and cryptocurrencies investor.

Most employees do not find the time to practice self-reflection. As a consequence, they are unaware about their personality and needs. By asking the right questions, a psychotherapist helps employees understand their minds and guides them towards self-awareness. Frequent self-awareness therapy increases resilience and productivity while also reducing sick days. Both result in a positive return on investment. Bonus: You follow the footsteps of companies like Google and SAP.

2014 was one of the hardest years of my life. End of April that year, I decided to quit my job at the company I had co-founded with four friends. This decision was followed by a six months long debate on the deal that finally resulted in me selling all my shares back to the remaining team. For all of us founders, as well as for our friends and family, this process cost time and nerves, and eventually our friendship. Here’s how I usually tell people what happened: our company was operating in two entirely different markets (Germany and Oman). I believed the better strategy was to first win one of these markets, before launching the international expansion. The rest of the team did not agree with this opinion, so I left. End of story.

Here’s what actually happened: our team was wonderfully complementary with regards to our technical skills. We had a culture of open feedback and were all driven to make our entrepreneurial dream become reality. What was our problem? While we all shared a getting-things-done-mentality, two of us, myself included, were also driven by a need for power. At the time, I clearly lacked the self-awareness to see how our personalities turned discussions from a search for the right answer into a struggle for power.

My story is not an isolated case. Everyday, teams that seemingly operate under perfect conditions break up. On the one hand, this is extremely stressful for the individuals involved. On the other hand, the apparent productivity loss kills effectivity and results in high financial damage. I am certain that these negative effects can either be minimized, or team break-ups might even be averted by self-awareness therapy: self-awareness refers to an individual’s introspective ability to recognize their personality and needs (inner self-awareness) as well as understanding how they relate to others and their perspectives (external self-awareness). Teams risk running into the same trap as my former team if their members lack either component of self-awareness. Yet, while a large body of research emphasizes the importance of a team’s personality composition, often this factor is naively overlooked during the romanticized forming and storming phases of launching a company or project. As a result, founders, as well as managers, neither know how their co-founders’ and employees’ minds function, nor do they understand their own.

Current state of self-awareness

I interviewed founders, employees, workplace health managers, as well as therapists to understand the level of self-awareness in the workplace. Their thoughts translate into three needs:

1. Diagnosis: individuals seek a way to understand their own personality and needs, as well as the minds of their employees and peers
2. Intervention: managers feel overwhelmed with researching and offering the right “therapy” for their teams
3. Evaluation: while the intuitive benefit of therapy is clear to most, they question the numerical return of investment

Many founders and team leads overlook that a professional therapist can make the right diagnosis and recommend an appropriate intervention that will have measurable impact. Let’s discuss these dynamics in detail.

1. Diagnosis: How to understand your team’s personalities?

Organizational psychologist Tasha Eurich found that almost all of us think we are self-aware. In fact, only 10–15% actually are. Naturally, it won’t be easy to find out for yourself if you are one of these rare self-awareness “unicorns”. Some refer to more or less scientific tests to assess their mental state. Others read one self-help book after another, in search of enlightenment. In any case, you will have a hard time cutting through the immense number of psychometric tests and self-assessment manuals without any professional guidance. Ultimately, “you won’t [know and you won’t] change just by reading a book.” And your employees won’t either.

“Your friends, family, and colleagues, they all follow their own agenda.”

Seeking a therapist’s advice instead, is the first step towards collective organizational self-awareness. Not only can therapists assist you in selecting the right psychometric tool, they can also provide a more scientific interpretation of the results. As one management coach put it: “Your friends, family, and colleagues, they all follow their own agenda. They project their own ambitions, goals, fears, and an entire history they share with you into their advice. Only an outsider can provide a truly objective perspective.” Surely, you should always value your peers’ opinion. Still, a therapist will provide a very useful outsider’s view. Apart from seeking a therapist’s advice for yourself, you should also send each employee to therapy. This will provide them with the opportunity to openly — without the fear of being judged — learn about and discuss their needs. Furthermore, it helps employees to seek tasks they excel in and more honestly mention personal motivations behind their arguments.

Self-awareness therapy encourages you to think about the right questions at the right time.

2. Intervention: What is the right therapy?

Maybe your company already offers yoga sessions, weekly massages, or mindfulness meditation for employees. This is great! No doubt, these “relaxation exercises” act as an outlet for the already stressed part of your workforce. Yet, their impact on everyone’s self-awareness, and thus on actually solving apparent issues, is unclear: The Guardian author Steven Poole criticizes that the concept of modern mindfulness interventions is in fact “opposed to deep thinking”. While the purpose of mindfulness meditation is to teach you how to “let thoughts come and go” (Headspace), self-awareness therapy instead encourages you to think about the right questions at the right time. For example: “What are your biggest failures and what commonalities exist between them?” (Taken from Tasha Eurich’s Insight.) In fact, self-awareness therapy is so powerful because it caters to your employees’ desire to better understand their inner state. Reflecting on your personality and behavior helps you understand why something makes you uneasy, and how you might address the negative feeling. This will not only improve your mental wellbeing and sanity. Openly addressing weaknesses will increase your own and your peers’ productivity, as Bridgewater Founder Ray Dalio teaches us in his recent book Principles. Consider self-awareness therapy a preventive health measure with a direct impact on productivity.

Beyond the preventive benefits, a first conversation with a therapist also acts as a unique access to treatment for those affected by distress and mental illnesses. The conversation encourages employees to express issues that they do not dare to discuss with friends or colleagues. This is one of the reasons a researcher from Charité Berlin, Europe’s largest university clinic, recommends therapy for literally everyone: the first session is the most important step towards betterment. Taken from there, the therapist can confidentially funnel the affected to treatment, without them having to fear stigmatization and help the healthy to better understand their personality and behavior.

In summary, providing employees with access to self-awareness therapy will not only result in a more reflected and effective workforce, it will also contribute to the overall health of your teams. This will in turn have a strong impact on your company goals.

3. Evaluation: Which impact can you expect?

As a team of researchers from the London School of Economics (LSE) reports, already the promotion of general well-being in the workplace reduces the hours of presenteeism (being at work while sick) and absenteeism (habitual absence from work). They predicted productivity gains of more than £350,000 (ca. $490,000) for a company with 500 employees. Similarly,meQuilibrium, a provider of resilience trainings, reports yearly returns of more than $1,000 per employee linked to a 16% increase in resilience.

Self-awareness helps identifying management blind spots, accepting personal weaknesses, and motivates improvement.

These numbers are equally impressive for self-awareness trainings: an analysis by recruitment firm Korn Ferry demonstrated that companies led by more self-aware managers show higher rates of return than their competitors with less aware leaders. This ties to the concept of personal evolution that Ray Dalio endorses in Principles: self-awareness helps identifying management blind spots, accepting personal weaknesses, and motivates improvement.

Following these arguments, 77% of US human resource professionals promote Employee Assistance Programs (EAPs) (Wikipedia has a good definition of EAPs). Yet, just like the relaxation exercises referenced above, EAPs often concentrate on curing symptoms such as stress, instead of focusing on the the promotion of self-awareness and thereby the prevention of mental health issues. This is why companies like Google and SAP provide their workforce with a more extensive battery of mindfulness as well as self-awareness programs.

Smaller players, however, are overwhelmed by the immense number of therapists and other providers promising the effects of their various interventions. Many startups raise concerns that they are too tight on budget to afford offering a 24/7 service or hiring a full-time therapist. One workplace health lead I interviewed boils the issue down to its essence: there needs to be a central platform providing quality checks and convenient booking of the right employee therapy.

Drawing from the present academic insights and my own data, I believe that such a platform could not only simplify the booking process. It would further encourage a cross-company understanding for the importance of mental health interventions at the workplace. By assisting firms of any size to find a measurable self-awareness therapy that is tailored to their needs, we can reform workplace interaction and employee mental health.
Sharpist will be the first platform of this kind. If your team’s wellbeing and productivity is something important to you that you want to work on with measurable insights, reach out: sharpist.org.

Thank you to all the Oxford friends and family, who contributed reviewing my thoughts. Also thanks to my former co-founders for providing me with this valuable learning. I wish you all the best of luck on your future journey.

Disclaimer: I understand that the term “therapy” technically refers to the treatment of sickness symptoms. However, I agree with some researchers’ opinion that most preventive treatments are in fact therapeutic.

About the Author

This article was written by Hendrik Schriefer, Experimental Psychologist and Co-Founder of Sharpist. See more.

There’s a fixture at my local pub, let’s call him Joe, who possesses an almost encyclopedic knowledge of the latest and greatest tragedies. Last month’s shooting in the area? Don’t get him started. He’ll tell you the number of shots fired, how many police cruisers arrived on the scene, and that so far there have been no arrests. Did you hear about the most recent terror threat? Yesterday’s awful car crash? Trump’s tweets? Synthetic marijuana?

Joe’s monologues — conversations with him tend to be one-sided — usually just scratch the surface. Listening to him deliver a eulogy for the humanity drowned in his pint feels like sitting in front of misery’s conveyor belt. Pour me another. The world is wretched. We’re truly screwed.

Joe comes from a long line of tragedy gossipers. His ancestors told of many a calamity, and at one point in time you would’ve wanted to pay attention to their every word. Tens of thousands of years ago they would have told you about a nearby lion attack, the threat of intertribal conflict, or an untrustworthy clan member. The information was directly relevant to your wellbeing and survival, and would inform your decision of where to hunt, whether to move or prepare for battle, and who to trust.

Our brains have been hardwired by evolution to pay attention to threats. In its crudest form, the brain analyzes data and determines whether we should fight or flee. In other words, the part of the brain central to the processing of emotions, the amygdala, is constantly on the lookout for anything ominous. In some ways the media has become the extension of the caveman stories of gore and lore, only today, instead of being limited to our direct surroundings, that input is coming at us from every corner of the world.

Thanks to the 24-hour news cycle and social media we’re bombarded with the latest to fear, to be saddened by, or to be angry about. We’re saddled with information that’s disconnected, oversimplified and difficult to act on — and if we cannot act on these emotions, we will find it difficult to be relieved of them.

The impact that media can have on our mental health has been studied and written about, as has why we’re drawn to depressing stories in the first place. A media obsessed with covering negative news can be subtly traumatizing, perhaps cultivating a society that is more fearful, detached, anxious, paranoid, angry, insular and even vengeful. All this at a time when the world is arguably getting better: we are more tolerant, less violent, less unequal, and less poor. For the first time, we have the wherewithal and technological capacity to find solutions to the daunting challenges we face.

The social innovation movement — people working across sectors to solve social, environmental, cultural and economic problems— has grown exponentially around the world in recent years with new university programs, incubators, accelerators, labs, funding pools, tools and practitioners. This growth reflects an unprecedented awareness of the issues and an increasing resolve to solve them. But reports on how these challenges are being tackled, and whether the responses are succeeding or failing, are too often missing from the mainstream media.

Solutions

“The choices we make are determined by the information we are given. These are fundamental to how we shape a better world together,” UN director general Michael Møller recently said when he called for the media to take a more “constructive” and “solutions-focused” approach. “I’d like to see the media engage in solutions-driven journalism which not only reports problems but explores potential solutions to those problems as well.”

Solutions Journalism reports on the responses to social and environmental problems, and empowers people with a more holistic understanding of complex issues and a greater sense of agency. Covering successful as well as failed responses to problems fundamentally shifts the discussion from all that is wrong to what is being done about it.

As the Solutions Journalism Network notes, “it’s just good journalism,” because it represents the whole story: the problems and the responses. Research (like this and this) shows that “solutions stories” (see examples at the end of this piece) are more likely to be shared on social media “partly because they can make listeners feel powerful, less likely to tune out, and less apathetic or cynical about the problem.” As Møller points out, “interestingly, there is growing evidence that it makes a lot of commercial sense as well.”

This isn’t to say that the media shouldn’t cover the world’s problems. Nor should every story be a solutions story. The journalists who work tirelessly to serve as witnesses, to expose corruption, and to confront humanity at its worst are heroes in my book. But our story is about so much more than death, greed and destruction. Our resourcefulness and our ability to collaborate have kept us alive and fueled our progress. We have arrived at a point where, far from having to choose between fight or flight, we can instead opt to empathize, grapple with complexity, and cooperate to solve problems. Why is this part of our story so rarely reflected to us on our screens? It needs to be.

Story

In an age of quick-hit reporting it seems there’s often too little time to invest in a strong narrative. But if journalism aspires to create change rather than titillate, to observe with purpose rather than engage in voyeurism, then storymust be part of designing for impact. Millennials, for one, want to be entertained, even when it comes to news. It’s why VICE has done so well in that demographic with its trademark style of irreverent, host-driven narrative journalism.

But even beyond that particular demographic, it’s why the number one show on CNN, Parts Unknown, features a celebrity chef, Anthony Bourdain (whom Fast Company dubbed “the future of cable news”). What Bourdain excels at is connecting with people at a human level. His ability to challenge cultural assumptions and to let citizens tell their own stories rather than relying on “experts”, results in intimate portraits more revealing of complex realities than the sound bites and sensationalism of many newscasts.

Startups

For years the talk has been about an industry in ruins. From giving content away for free, to dwindling ad revenues, to corporatism, media’s sins are plentiful. But this does not signal the demise of journalism but rather an opportunity for it to reinvent itself. In fact, it may be entering a renaissance.

Some of the best journalism has yet to be experienced — and I say experienced because it may be read but it may also be lived vicariously through virtual reality headsets. More voices will be heard, and people will engage with, and even participate in, the reporting process as never before. Instead of teaching inverted pyramids, J-Schools may become more like labs for experimentation and innovation in factual storytelling. Established media will think more like startups by building, testing, learning, iterating and scaling. Accelerators like next media accelerator and Matter will incubate promising media startups like News Deeply. Journalists will become entrepreneurs, leveraging tools like crowdfunding to launch groundbreaking initiatives with new business models like De Correspondent (check out the work of their Progress Reporter, Rutger Bregman). The public will help fund the journalism they want like Canadaland, and journalism will become more collaborative (as it did when 370 investigative reporters from 76 nations poured through the Panama Papers). Emerging platforms like Blendle (think iTunes or Netflix for journalism) may change how we consume news.

The future of journalism will be decentralized, collaborative, ambitious, compelling, entrepreneurial and constructive. It will better reflect our world: one often bursting at the seams with horror, but also held together by our resilience and resolution. It will move and engage us. It will show to us that we can all be a part of the solution.

I’m exploring the creation of the Solutions Media Accelerator for storytellers and startups at the Centre for Social Innovation. The Accelerator aims to support the success of solutions journalists and promising media startups with workspace, training, mentorship, events and connections, and serve as a lab for the media and the public to envision and experiment with the future of journalism. Email me at barnabe@socialinnovation.ca.

Recent Examples of Solutions Journalism

The Irrationality of Alcoholics Anonymous, Gabrielle Glaser, The Atlantic: Looks at how Finland is tackling alcohol abuse differently and why it’s succeeding. It has been shared over 148,000 times on Facebook.

Walking Together for Health and Spirit, David Bornstein, The New York Times: A story on the growth of GirlTrek’s movement and its impact on the health of black women, inspiring tens of thousands to change their lives and communities by walking.

Power Struggle, Discourse Media: A nine-month collaborative investigation into energy poverty solutions around the world.

How Toronto is learning from Cleveland’s return to prosperity, Sara Mojtehedzadeh, The Toronto Star: A look at how Cleveland managed to come back from economic and social despair.

Chasing Heroin, Marcela Gaviria, PBS Frontline: A searing, two-hour documentary placing America’s heroin crisis in a fresh and provocative light, and exploring what happens when addiction is treated like a public health issue, not a crime.

In School Discipline, Intervention May Work Better than Punishment, Claudia Rowe, The Seattle Times: Examines alternatives to school suspensions. The article and its related events organized by the Times led to Seattle’s school board declaring a moratorium on suspensions.

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About the Author

This article was written by Barnabe Geis, Manager of Impact & Accelerators at the Centre for Social Innovation.

Apple took a major step forward to influence the future of healthcare with the release of an ECG app and irregular heart rhythm notification. With the Apple Watch Series 4, users can take an ECG similar to a single-lead reading. And owners of Apple Watch Series 1 or later (with watch OS 5.1.2) can get notified if an irregular heart rhythm such as atrial fibrillation (AFib) is identified (per the American Heart Association, AFib is present in about one in five strokes.) The new functionality has already been credited with saving one man’s life. The release of the app also comes with a challenge: earning credibility with physicians, who have voiced concerns about people misreading the app’s data. But Apple is up for the challenge — and will succeed. That’s because for years, Apple has built partnerships across the healthcare ecosystem. Those partnerships have provided a proving ground for Apple’s healthcare apps and generated a reservoir of goodwill for one of the world’s most valuable brands.

A Healthcare Strategy

The ECG app, announced at Apple’s September 12 Special Event, support Apple’s strategy to improve healthcare by being the data backbone for patient care. That strategy has three key elements:

• Software for patients and providers to monitor and share data, which is where apps come into play.
• Hardware: the Apple Watch and iPhone to create an ever-present device platform.
• Relationships with healthcare providers such as hospital networks to monitor and share wellness data.

Apple’s penetration of healthcare supports its growth in both wearables and services, two categories that, while small, are contributing more to Apple’s revenue growth based on its fourth-quarter earnings results announced November 1. But with healthcare, CEO Tim Cook has loftier aspirations than generating more revenue. As he told TIME recently, “Apple’s largest contribution to mankind will be in improving people’s health and well-being.”

His focus on wellness care in particular positions Apple well. The PwC’s Health Research Institute (HRI) cites wellness care as one of the top forces shaping the future of healthcare industry, with wellness accounting for $276 billion of the $5 trillion U.S. healthcare ecosystem.

Reaction from Physicians

But to improve health and well-being, Apple needs to have physicians on board. Some have been publicly critical of the ECG app, while others have been supportive. The announcement of heart monitoring features during Apple’s September Special Event almost immediately triggered concerns from physicians who worried that patients would misdiagnose themselves. But the announcement also came with support from the medical community. For example, Christopher Worsham, a critical care physician at Massachusetts General Hospital, and Anupam B. Jena, an internist at Massachusetts General Hospital, wrote in Harvard Business Review, “ . . . doctors shouldn’t be too quick to dismiss the new feature, particularly as it appears amidst growing consumer enthusiasm for wearable devices that measure health behaviors. The Apple Watch has the potential to provide valuable data that benefits the entire health care community.”

Now that the ECG app is live, Apple has experienced both criticism and good PR. On the one hand, an Orange Country cardiologist, Dr. Brian Kolski, has complained about numerous patients contacting him because they thought their Apple Watches were reporting heart problems when in fact nothing was wrong. Dr. Kolski discussed a patient who contacted him in the middle of the night, panicking about a heart reading he’d seen on his Apple Watch.

“He texted me the strip, and it was completely normal,” Dr. Kolski told The Orange County Register. “This was a healthy 45-year-old man who was playing around on his watch and went into a major panic.”

On the other hand, the new features are generating positive news coverage for Apple. TechCrunch and ABC News have already reported the case of Ed Dentel, whose physician told him that the new app likely saved his life by notifying him of an abnormal heart rate. Dr. Sanjay Gupta, CNN’s chief medical correspondent, tested the ECG app and reported it to be “remarkably easy” although he cautioned users to use the app with care.

“The app may also increase visits to the doctor from newly concerned patients,” he wrote. “Still, there has been considerable enthusiasm from the medical community as a whole . . . There is no doubt Apple is counting on doctors to use the data collected by the Apple Watch. The company has made it easy to upload your ECG, along with a description of your symptoms, to your personal doctor directly from the app to facilitate that communication. It’s all part of their big bet on making an impact in health care.”

Strong Relationships in Place

The PR is important, and so is the data that Apple cranks out to substantiate the value and accuracy of the ECG app. But Apple already has something else going for it: a demonstrated ability to forge partnerships with the medical community. The launch of the ECG app is just the latest in a long list of Apple’s accomplishments on the road to become a healthcare player — and those successes have come through partnerships with physicians that I discussed in my recent white paper, Dr. Apple Will See You Now. For example:

• In 2014 Apple, launched HealthKit to give Apple users a central repository to track health and fitness data on their Apple devices. In February 2015, Ochsner Health System in New Orleans launched its “Hypertension Digital Medicine Program,” which relies on HealthKit to help patients measure and share with the provider their own blood pressure and heart rates. Oschner adjusts (in real-time, if needed) patients’ medications and lifestyle counseling based on the findings.
• In 2015, Apple released ResearchKit, an open source software framework designed for medical and health research, intended to help doctors and scientists gather data more frequently and more accurately from participants using iPhone apps. The University of Rochester has used ResearchKit to build an app for the largest Parkinson’s study in history. According to Apple, “the app helps researchers better understand Parkinson’s disease by using the gyroscope and other iPhone features to measure dexterity, balance, gait, and memory.”
• In January 2018, Apple announced that its Health app will make it possible for users to see their medical records right on their iPhones, which would thus empower potentially 90 million Americans who own iPhones. When Apple launched the capability, the company came out of the gate with 39 hospital networks participating. (Apple keeps a running list of participating hospital networks on its website.)

Apple has published more examples of successful physician collaboration. For instance, at Johns Hopkins, physicians provide epilepsy patients with Apple Watches to track their seizures, possible triggers, medications, and side effects. Thanks to a special app developed by Johns Hopkins, the EpiWatch, patients have access to their personal information through a dashboard that also shares data with providers if the patient wants to do so. Patients can also send a message to family members and providers to let them know when the patient is tracking a seizure. Johns Hopkins is collecting this data to eventually understand how to predict seizures before they happen.

Hiring Physicians

Reportedly, Apple’s journey to healthcare prominence also means hiring approximately 50 physicians. CNBC cited the example of hiring hired an orthopedic surgeon, Sharat Kusuma, who leads a team working with medical device maker Zimmer Biomet “to study whether Apple technology can help patients recover from knee and hip replacement surgeries.” In a December 12 article, Christina Farr of CNBC wrote, “The hires could help Apple win over doctors — potentially its harshest critics — as it seeks to develop and integrate health technologies into the Apple Watch, iPad and iPhone.” She added,

Doctors can also help Apple guide the medical community on how to use Apple’s new health technologies and to deflect criticism. As an example, when Apple announced its electrocardiogram sensor to track heart rhythm irregularities, the company put up a website to help answer physicians’ questions. That’s important because there’s a very high bar to win approval among doctors who fear liability and are already overburdened by technology.

And here is where Apple’s established relationships with medical networks will pay off. Apple is not trying to build relationships and credibility from scratch. Apple already possesses goodwill by proving itself through efforts that precede the ECG app (such as those cited above). And Apple’s other ace in the hole is usage among physicians: 75 percent of doctors in the United States own some form of Apple device, according to a study by Manhattan Research.

We all know Steve Jobs was the super power who made Apple synonymous with changing the world. But Tim Cook is building a legacy, too, around healthcare. That’s because Apple is improving healthcare through partnerships, not disruption.

About the Author

This article was written by David Deal, CEO of David J. Deal Consulting. See more.

A business model helps to clarify a company’s main purpose, such as who they’re serving, how they help, and how the company can sustain its operations. A business model is distinctly different from an organization’s strategy, which typically addresses product, pricing, and marketing decisions. A formal business plan, however, may include some of these elements as part of the company’s long-term goals and objectives.

Each business model is unique to a company. There is not an industry-wide business model per se although companies may coalesce around a dominant company’s successful business model and seek to emulate it.

Business models provide a rationale for how a business creates, delivers, and captures value,^[1]and examine how the business operates, its underlying foundations, and the exchange activities and financial flows upon which it can be successful.^[2]

A business model canvas is a tool to map out and plan the different components to a business model. The components vary based on the canvas tool you use, with the most widely used one developed by Osterwalder and Pigneur in the book Business Model Generation, or available online through a series of customizable tools and canvases available for a fee on strategyzer.com.

The Osterwalder and Pigneur canvas blocks include revenue stream, customer segments, value proposition, cost structures, channels, key activities, key partners, key resources, and customer relationships.

Early on, your greatest focus should be on the right side of the canvas because:

• These are in many ways the most critical aspects of starting a new venture (customer segments, value proposition, channels, and revenue streams).
• The most fluid (revenue streams, channels, and value propositions will likely differ for the differing customer segments and as you iterate and pivot throughout the customer discovery process could change).
• It follows a logical temporal order (there’s no need to focus on the costs of building a company if you won’t have customers).

In a follow up to Business Model Generation, the Strategyzer team created a second canvas, the Value Proposition Canvas. Value Proposition Canvas is a new tool that pulls out the customer segment and value proposition blocks of the business model canvas and encourages more in-depth exploration of those blocks to achieve “fit” between the two. The Value Proposition Canvas tool looks at customer pains, gains and jobs-to-be-done on the customer side and painkillers, gain creators, and products and services on the value proposition side.

A revenue model focuses on an organization’s revenue streams, e.g., how a company will make money, whereas a business model also concerns itself with other issues such as who the product is serving, how it is distributed and promoted, and key partnerships used in implementing it. In short, a revenue model is just one component of a business model. A typical business model has multiple elements (nine in the case of the Osterwalder and Pigneur model). A revenue model is primarily focused on how a company will make money.

For traditional legacy media outlets, such as a newspaper, revenue streams typically encompassed advertising and consumer payment either through subscription or alternate payment methods like single-sale purchases.

Hayes and Graybeal (2012) provide an overview of categorizations of online business models from the late 1990s to late 2000s from scholars and industry practitioners, including many online content plays. Revenue models were the most common components found in all forms of business model classifications. Value streams and logistical streams were also equally important in e-commerce models.

Think of a business model canvas as an ideation tool to help brainstorm and flesh out your startup concept. The business model is a more adaptable, flexible tool that can be used to formulate the ideas that would later be fleshed out in a more formal business plan.

A business plan is a formal document, presented to prospective investors, that typically includes elements such as an executive summary, business description, marketing strategy, and competitive analysis. A business plan may also include a business model canvas as supplemental material in an appendix.

You should usually develop a business model before a business plan. But before you get to a business model, first and foremost, you need an idea. There are numerous resources for brainstorming activities and entrepreneurial processes to help develop an idea and flesh it out to be “market-ready.” (see previous chapter on Ideation) Original ideas are sometimes hard to come by.

Early research into competitors helps as a starting point. Who else has had this idea? Has this idea been tried before and failed? That’s not necessarily a dealbreaker. As renowned media economist Robert Picard notes, just because an idea failed at one point in time, under a certain set of circumstances, that doesn’t mean a failed idea can’t be revisited.

Another entrepreneurial startup truism is that no matter how great your idea may be, if no one will use your product, then you’re dead on arrival. So startup ideas need customers to become a business. Thus, the various entrepreneurial processes, whether that is business model canvas tools, lean startup principles and methodologies, or other approaches, focus a great deal on the customer.

The Osterwalder and Pigneur book describes a process of creating a customer empathy map to distill down your ideal target customer. Bring to life an individual, and delve into his or her fears, dreams, aspirations, and what she or he does in the everyday life. After identifying your target customer, you can begin to segment your audience. But start with an individual customer, idealized or actualized, and distill deeply into that customer profile.

The Customer Empathy Map is an idealized portrayal of your fictionalized target customer, the most promising candidate from your customer segments. Give him or her a name and demographic characteristics, such as income, marital status, and so forth, before delving into the pains, gains, thoughts, feelings, and surroundings of this individual you bring to fruition.

This is an approach that has long been used in media and communication fields such as advertising and strategic communication. Advertisers and marketers often create customer personas–fictional, generalized representations of ideal or existing customers–as part of campaign plans, pitches, strategy, and creative concept delivery.

When you peel away the language used to describe business models, the early startup planning stages come down to asking a series of questions. Another popular framework used in entrepreneurial circles when it comes to formulating a business model for a startup concept is that of desirability-feasibility-viability.

This forces the entrepreneur to address broad questions about the startup concept.

Desirability: How desirable is the product? Who will use it and why?

Feasibility: How feasible is this idea? What are the costs to make it? How practical is the concept?

Viability: Will this idea remain viable? How will it make money? How will it be sustained over time?

These questions then begin to connect together to form a narrative about where the startup concept came from, who it serves, why it’s needed, how it will make money, and how it will be sustained in the future.

Strategyzer also has a great “Ad-lib” template that will help you figure out a few potential value propositions. They also offer other resources you can access after signing up for a free account.

BUSINESS MODELS

Although there is not a single definition to the term business model and usage varies widely, in standard business usage a “business model” can denote how costs will be covered as well as how a business creates and delivers value for itself and its customers, including the ways in which products are made and distributed. Academic strategists tend to use the term business model to describe the configuration of resources in response to a particular strategic orientation.

Most people are familiar with Business to Consumer models (also referred to as BTC or B2C). In a Business-to-Consumer model, the business primarily provides services to consumers. Many of the common media content plays are considered B2C. Newspapers, television shows, films, and video games are primarily B2C companies. Many apps that individual users download and then consume content from are B2C. Because media companies are typically providing content that is of value to consumers, they look like a B2C, however, they use the attention of those consumers to sell advertising space to businesses, effectively operating as a B2B. Business to business to consumer (or B2B2C or BtoBtoC) is another prominent e-commerce model, that combines Business to Business and Business to Consumer in a complete product or service transaction.

Nascent startup Shine, which officially launched its inspirational text message service in Spring 2016, is an example of following a classic Business-to-Consumer model. (Full disclosure: I taught one of the founders.) Through automated texts, Shine delivers daily self-help, encouragement and advice to its subscribers via either SMS or Facebook Messenger. Anyone can use the free service, but it is primarily aimed at millennials and about 70 percent of users are female.

On the Brooklyn-based company’s one-year anniversary in April 2017, the Shine team announced that it had obtained half a million users.  Co-founders Marah Lidey and Naomi Hirabayashi raised $2.5 million to further develop Shine in a funding round led by Betaworks and Eniac Ventures, and including Female Founders Fund, Felix Capital, Comcast Venture, BBG Ventures, The New York Times, and Ed Zimmerman.

They want to expand the service to be included on other platforms like Line and WeChat.

The problem Shine tackles is that “self-help is broken” and its value proposition addresses in part what is known as “the confidence gap,” often cited as a barrier that holds women back when it comes to advancing in their careers, raising money, investing, and planning retirement.

Shine has four pillars it is built to address: mental health, confidence, daily happiness, and productivity.

In 2015, Hirayabashi and Lidey began to focus on turning their idea into a reality. The two met at and worked together at DoSomething.org, a youth-oriented global nonprofit organization. They conducted a closed test with 70 individuals before publicly releasing Shine in beta in October 2015. They formally left DoSomething.Org in April 2016 and Shine was born.

While the messaging service is free, the company has experimented with adding revenue streams through additional consumer services. Shinevisor provides advice and guidance from real people who are certified life, career, and school coaches. That service currently runs $15.99 per week billed on a 12-week basis. Shinevisor is an early effort of Shine to add additional services that bring in revenue, as multiple revenue streams are most often needed for a company to succeed.

While Shine, apps and a majority of content plays are primarily B2C, the other predominant business model is that of a Business to Business, also commonly referred to as B2B or BTB. Whereas Shine is a business whose product serves customers, in a Business to Business model, a company primarily serves other businesses, not individual consumers.

MailChimp, an Atlanta-based company, began as a B2B in 2001. More than 15 million people and businesses around the world use MailChimp. MailChimp enables many B2B marketing transactions. A leading marketing automation platform, MailChimp sends more than a billion emails a day. MailChimp’s primary customers were businesses that used the platform to send marketing emails, automated messages, and targeted campaigns to its individual users.

Historically, media companies that provide analytic services have sold that data and analysis to other businesses. Bloomberg’s financial terminals sold to businesses around the world is a classic example of a B2B service.

Küng, Picard & Towse (2008) also note “elements of different business models can be combined [so] in that sense, every business model of a company is unique.” For those reasons, a business model can be a source of competitive advantage, with business model design and product-market strategy serving as complements, not substitutes. Strategy functions like an architect creating a homeowner’s design, while the detailed floor plan based on choices in the design process would constitute a business model design.

When you go to get funding for your startup, having an understanding of your business model will come in handy.

REGULATION

Media are among the handful of industries that face industry-specific policies and regulations that other businesses do not face. The broadcast industry is regulated in the U.S. through the Federal Communication Commission. The print media industry is impacted by certain postal and governmental notice regulations. Banking and pharmaceuticals are other industries that face such industry-specific regulations. Reduced barriers to entry, promotion of trade, promotion of small enterprises, and regulation of consolidation and concentration are among some of the policies and regulations media must face. Media strategy can be influenced by these environmental factors, firm factors, industry factors, and media-specific factors, among others. Some regulation can hinder startups.

That’s why policy is one of the domains of enabling an entrepreneurial ecosystem. Government supports can come in the forms of tax breaks and incentives, regulatory frameworks, venture-friendly legislation, institutional investments, financial support, and policy initiatives.Regulation and policy limitations to the strategic choices available to media companies are two examples of media-specific characteristics.

Regulation can help or hinder incumbents or startups based on policies that are set. For example, regulations pertaining to net neutrality have been debated for years, with many startups of the past decade arguing that without net neutrality they would have faced disadvantages instead of the environment that enabled them to grow and prosper. Many technology startups, for example, banded together in July 2017 to form a protest over FCC proposals to eliminate Obama-era net neutrality rules. Y Combinator, a popular technology startup incubator, was among the backers of the protest, along with companies like Kickstarter, Etsy, GitHub, Amazon, and Reddit.

Government policies can also support entrepreneurship. Some U.S. cities have staff dedicated to innovation and entrepreneurship. New York City for example uses revenue from its film and television projects to fund media entrepreneurship efforts like the NYC Media Lab.

New York City’s media and tech startup scene, so-called “Silicon Alley,” is no longer confined to a small alleyway in NYC’s financial district and is more of a concept than a location. Media companies such as Google and IAC/InterActiveCorp make up part of NYC’s media ecosystem. In 2012, the Center for Urban Future proclaimed that NYC witnessed over 1,000 media startups including Tumblr and Mashable.

During this time, NYC was also witnessing the growth of media cooperative working spaces, accelerators and incubators including New York University’s (NYU) Polytechnic Institute Tandon Future Labs supported by the New York City Economic Development Corporation. During this time Mayor Bloomberg advanced tax breaks and funding opportunities for media startups in NYC as part of his five-borough economic plan.

The NYCEDC, in a public-private partnership, also helped launch the NYC Media Lab in 2010. The primary goal of NYC Media Lab is to connect the media industry during the dot-com revival in NYC and colleges and universities in the area to advance media entrepreneurship. The consortium, which includes Columbia University, New York University, The New School, the City University of New York (CUNY), the IESE Business School, and the Pratt Institute, work under the NYC Media Lab umbrella to generate media research and development and advance media entrepreneurship. The Combine serves as NYC Media Lab’s incubator and its main goal is to position NYC as the media capital of the world by advancing and launching “one-of-a-kind” media and communication technologies. Specifically, the Combine aims at supporting and growing media startups from faculty and students from collaborating universities with a high potential to launch. The Combine is funded by the NYCEDC, the Mayor’s Office of Media and Entertainment, and NYC Media Lab’s corporate members.

Some current projects include an experiment with metadata extraction from book manuscripts for Audible, a market research project for MBA students in New York City on augmented reality products for Hearst Ventures, an augmented reality fellowship in design and engineering through Bloomberg and Lampix, and a virtual reality fellowship for Viacom NEXT.

Many European countries also provide funding for entrepreneurial initiatives. In 2004, the Flemish government established iMinds, a digital research center and business incubator to focus on information and communication technology. The European Union and other European nations routinely fund innovation and entrepreneurial projects.

APPLICABLE TECHNIQUES

Content Models

Revenue streams are a common element of most definitions of business models, particularly ones used to address electronic commerce. Many online news business models, historically, have been similar to traditional business models, as subscription, advertising, and transactional are the most common categories of online business models.

Advertising and subscription still remain the most dominant forms of revenue streams used in most content business models. Content plays involve the creation and dissemination of content, such as news or entertainment, which users will want to receive.

Here’s an example to help you better understand what I mean by a content company. There’s an excellent episode in the first season of Startup, the podcast about creating a startup from Gimlet Media in which the founders, Alex Blumberg and Matthew Lieber, debate whether Gimlet is a content company or a technology company. In the episode, Gimlet Media thus far has gone the route of being a content company. The company produces content—in this case compelling podcasts—that are then distributed on other technology platforms, such as through Apple or Spotify. If Gimlet became a technology company, it would launch a proprietary podcast-playing platform. For comparison’s sake, Spotify provides a platform for streaming audio but does not produce the content—the music, the songs, the podcasts that play on that platform.

See the additional resources included at the end of this chapter for lists of many revenue streams for many digital media, mobile, and e-commerce companies.

Some of the most common forms of revenue streams used in content companies include:

Subscription

When the newspaper industry moved into online content delivery, many companies initially gave its content away online for free. Within the past decade or so, most newspaper companies have offered digital-only subscriptions and bundled online delivery along with the traditional print product. Within the United States, the leading paywall system was developed by PressPlus. Paywalls offer users a certain number of free page visits, before being blocked with subscription, the primary means to gain additional access.

Many digital media companies that offer content, particularly those that offer content that compete with traditional companies such as newspapers, magazines, and broadcasters, have implemented a Paywall approach. A paywall can be hard where the only way to access the content is to pay for it, usually through a subscription, or soft, where the user is given a certain number of free visits or views per month before being asked to subscribe.

Another common subscription model used for content and technology plays is that of a freemiummodel. Under a freemium model, access to basic content is free, but users can choose to subscribe to premium content for a fee that provides improved access (such as an ad-free experience) or additional services. The online music streaming service Spotify is a classic example of a freemium model, with basic access to ad-supported music online available for free, with monthly premium subscriptions for a fee. Dropbox is another commonly used digital startup that relies on a freemium model. The cloud-based file storage service offers free storage up to a certain amount, and charges a monthly fee beyond that.

Membership is another subscription model. Under a membership model, the content can either be free or paid, but users who purchase a membership receive perks and bonus materials, exclusive access to supplemental materials, and so forth. In many instances, these content companies have been focused on a certain content form (technology, politics, sports) rather than general interest publications. Musician fan clubs and sporting teams are classic examples of non-digital content entities that excel at offering memberships. That same model is applied to media companies, typically ones that diversify their offerings through some of the other miscellaneous revenue streams discussed later (such as events and conferences; archival data, etc.).

Classic subscriptions, of course, are the most prevalent. Netflix is probably the most well-known media content company that offers access to its content through monthly subscription options. As previously mentioned, some media companies offer subscription access based on content delivery mechanism (online, mobile delivery/web, all access).

Increasingly, more and more entertainment content is being sold through subscription packages, with over-the-top services independent of cablevision subscriptions being offered for individual channels (HBO, Showtime, ESPN) or in packaged bundles (Sling, Hulu, Amazon Prime, etc.).

Advertising

There are various forms of advertising for content and technology companies, with many forms specific to the delivery mechanism and form of the company. Traditional legacy media companies sell local direct advertising (newspapers, broadcasters), classified advertisements, sponsorships (most common in broadcasting) and are part of national advertising networks, among other forms.

Advertising networks are still prevalent for digital media content and technology companies, alongside selling direct advertising on various platforms. Native advertising, the use and sale of microsites dedicated to paid clients, the use of Google AdSense, and the sale of Outbrain-style links to external sites are common on web-based content and technology plays.

Content and technology companies can sell display advertising, search advertising, video ads, text/SMS advertising, mobile and digital forms of advertising, and location-based advertising among other forms, particularly in the mobile space. Content and technology startups can also develop their own proprietary forms of advertising content based on the system. For example, Twitter developed and sold promoted tweets and sponsored ads in its platform. Sponsorships, particularly used in podcasts, are another form of advertising available for content and technology plays.

Mobile advertising (“in-app ads” and “mobile display” ads) and variations of charging for content are the most prominent ways traditional media have sought to monetize content thus far, but there are many other alternative business models under consideration, including free and paid SMS alerts, social media platform distribution, and free applications.

Sponsored Content

One sometimes controversial revenue stream is brand storytelling, or advertisements that are written in the form of articles in the “voice” of the publication, and displayed alongside regular editorial content. Brand-sponsored content typically falls under the larger umbrella of “native advertising” as the ads appear “native” to the environment in which they’re displayed. Many top traditional journalistic outlets have an entire team or division dedicated to creating sponsored content for brands (e.g. New York Times’ T Brand Studio, HuffPost’s Partner Studio, Washington Post’s WP BrandStudio, Conde Nast’s 23 Stories and Forbes’ BrandVoice).

Transactional/e-Commerce

Content and technology plays often employ various forms of transactional, or e-commerce revenue streams. Some of these allow for an in-between option for users who want access to content, whether that be one-time or more, but don’t want a full subscription option. Let’s explore some of the most common.

Micropayments

Micropayments are small payments, typically $5 or less, for an individual piece of content. Every time you buy an individual song from Apple for download, for instance, you’ve made a micropayment. The iPod popularized the consumption of individual forms of music, chiefly song downloads, disaggregating individual song purchases from complete albums.

Virtual currencies can be a form of micropayment, typically employed within videogames or on online platforms, such as Facebook or Twitch, where users are making individual small purchases for virtual items, such as increased game playing ability, items used within game, or donations to other users.

Newspapers, magazines, and other forms of micropayments for news and digital delivery of content were tried unsuccessfully in the late 1990s and early 2000s, with companies like Flooz, Beenz, CyberCash, Bitpass, Peppercoin and DigiCash just a few examples of failed micropayment companies from its first era.

From about 2010 or so onward, additional efforts at micropayments have had varying success, usually within various regions. Blendle, a Dutch-based online news startup, has probably had the most success at selling access to individual news articles and magazine content, both in Europe and the United States.

Kachingle, CarrotPay, Knack.it, and Ganxy are a few other companies that offered various forms of micropayment platforms for content companies to utilize in recent years.

My colleague Jameson Hayes and I developed theoretical modified micropayment models for news and media content that introduce the ability for users to microearn for sharing content in addition to having to micropay for it but there are no functioning platforms that fully execute that conceptual vision.^[24][25] Many tend to agree that micropayments must be used in tandem with other revenue streams and can’t alone sustain a media operation.

Failure itself is widely embraced by the entrepreneurial community, as the entrepreneurial process encourages and promotes a series of failures along the way that lessons can be learned from (pivots, etc.) Entrepreneurs have even held annual FailCon conferences in which speakers share entrepreneurial failures and lessons learned in cities around the world.

Failure doesn’t mean an idea can’t be revisited.  Micropayments were tried unsuccessfully in the 1990s, but with the advent of Blockchain and Ethereum digital transactions have found more success in recent years.  With the creation of browsers like Brave, some predict micropayments and digital transactions to become more mainstream in the not-too-distant future.  Management and economics scholars have predicted that blockchain has the potential to transform intellectual property and content licensing, access to information and digital goods, and increase the value of curation of digital content.  They envision artists who license music on Apple or Spotify being able to easily track how many times songs are played by consumers, backers on crowdfunding sites obtaining royalties each time a song is played, digital goods priced and delivered using a blockchain for payment, contract enforcement, and authentication.

Some newspapers abandoned early efforts at digital subscriptions and for the better part of two decades the industry norm was free online content. Now, of course, digital content payments have been adapted by many companies. Blockchain enables an easy ability for micropayments to be implemented in a browser where users could pay a single subscription and navigate between different newspapers.

Donations

Some media organizations, such as The Guardian, allow for direct donations from readers. These outlets may make a direct plea on their homepage, or at the beginning or end of articles. Donations are also much more commonly used in nonprofits as outlined in the next chapter, but soliciting donations from users can also be done by for-profit media ventures.

Merchandise

Whether you’re a nascent startup or a more established company, selling merchandise with your company’s brand, name, logo, and slogans can serve as an additional revenue stream in addition to serving marketing purposes. T-shirts, mugs, keychains, and hats are commonly sold merchandise. Google, for example, has a physical store on its main campus that sells all sorts of Google-branded merchandise. Companies can also sell merchandise online.

Some other forms of e-commerce:

Crowdfunding

Crowdfunding, defined as “an open call, essentially through the Internet, for the provision of financial resources either in form of donation or in exchange for some form of reward and/or voting rights in order to support initiatives for specific purposes.” offers a novel way of funding projects.

Crowdfunding involves creators of a project soliciting donations from funders, or backers, of the project, through an online platform that features the project request.

Five basic kinds of crowdfunding models have attained widespread reach: donation-based, pre-purchase-based, reward-based, lending-based, and equity-based. In donation-based crowdfunding, the backers support a particular cause with no expectation of any kind of returns. However, in reward-based crowdfunding, the backers are provided with non-monetary benefits in exchange for their support. Kickstarter and Indiegogo are the most well-known and commonly used rewards-based crowdfunding platforms.

A pre-purchase model is similar to rewards. A backer receives the product the entrepreneur is making, such as a music album. Lending-based crowdfunding platforms offer a loan to small-scale lenders with an expectation for a return on capital investment. For instance, Kiva is the most premier lending crowdfunding platform that operates in 66 countries. Equity-based crowdfunding is that in which the backers receive an equity or stake in the profits of the project they have invested in. The Jumpstart Our Business Startups (JOBS) Act of 2012 allowed equity funding in the U.S. for the first time. Title III of this act allows small-sized business owners and entrepreneurs to retail investment that was previously restricted to select accredited investors and potential investors on various Internet-based crowdfunding platforms.

Crowdfunding gained popularity somewhere in the late 2000s. Since then it has shown unprecedented growth and is particularly common among startup entrepreneurs and investors. Circleup, Equity Net, AngelList, and Wefunder are examples of some popular equity-based crowdfunding sites.

Retail/Marketplace

One revenue stream for media startups could come from a “digital retail mall” or “transactional experiences” like shopping purchases through a digital credit card or online payment system.

Group Buying

Popularized and most well-known by the startup Groupon, this method provides discounted deals en masse to groups of consumers who scoop up the coupon-like savings that can be purchased and used at a later date.

APPLICABLE TECHNIQUES

Technology Plays

Many of the models previously mentioned for content plays (subscription, advertising, and transactional) are also applicable for technology plays, and we’ll discuss some miscellaneous categories beyond the Big Three for both.

One of the considerations for technology plays is the distribution mechanism, whether the product is available online, or mobile, some combination of the two, or neither. If the technology play is an Internet-dependent one, such as an app, then the choices are whether it is accessible through the mobile web (HTML5 is a common tool), or proprietary app stores. If it’s an app, then you must decide whether it will be formatted and available in Apple’s iOS format or Google and Android capability. Many universities and cities hold appathons or hackathons that bring together interdisciplinary teams to work on the creation of an app and/or the business plan and pitch for an app concept over a weekend. These are useful and can help flesh out some of the necessary steps and considerations for startup tech plays. Look for such efforts at your university or city. MediaShift also sponsors a popular hackathon several times a year that brings together students, faculty, and professionals from universities across the country.

If you are creating an app, decisions include whether the download is free or if you charge a one-time download fee. Then, you can consider some of the above-mentioned revenue streams, such as subscription, and mobile advertising.

Some other revenue models commonly employed in technology plays include:

Auction

eBay is probably the most well-known auction site, where users can post items for sale and get bids from other users.

Sharing Economy

Apps and websites that take advantage of the sharing economy have proliferated in recent years. Also referred to as the collaboration economy, this business model is predicated on collaboration, whether that is sharing an apartment or home (as is the case in Airbnb), sharing a ride (Lyft or Uber), or sharing office space (coworking spaces).

Miscellaneous revenue streams for both content and technology plays:

Events/Conferences

Mainstream media outlets like The New York Times excel at organizing live events and conferences as an alternative revenue stream, but startups can also do the same.  Media organizations sponsor live events, such as conferences and banquets, and charge a fee to attend.

Foundation Funding

See resources elsewhere in this textbook for lists of foundation funding sources. Many nascent entrepreneurs and media startups have benefited from foundation funding in the past. The Knight Foundation historically has been a large funder of media entrepreneurial efforts. The Lenfest Institute for Journalism is a new funding source for entrepreneurial journalism efforts. And organizations like the Kauffman Foundation and VentureWell fund entrepreneurial efforts writ large. Grants and competition prizes from foundations focusing on entrepreneurship are worth exploring as a funding source.

Sell Archival Access

Content companies who have created archives of past content can sell access to the archives to users for a fee.

Sell Data and/or Analytic Services

Analytics are usually more of a B2B play, where the business sells access to user data and analytics to other companies. In some instances, companies can sell analytic tools and services to users as well.

Licensing

Commonly used in technology plays, licensing as a revenue stream involves licensing out some form of proprietary technology, such as software or analytics tools, for use by other companies for a fee.

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