The shape of funding; Early days of Covid-19; Haber Bosch; Robotics & plant consciousness ++ #328

Hi, I’m Azeem Azhar. I convene Exponential View to help us understand how our societies and political economy will change under the force of rapidly accelerating technologies. My book Exponential (or The Exponential Age in the US & Canada) comes out in September. If you enjoy this newsletter, you'll love the book. Pre-order here.

😎 I had a great conversation with Charlotte Hogg, Executive Vice President and CEO of European operations at one of the world's largest payment companies Visa. We discuss network effects, blockchain and demographics as important drivers of the near future of digital payments.

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🧭 This edition is brought to you by Masterworks

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Dept of the near future

The shape of funding

🦄 When Elad Gil talks about unicorn funding, it’s good to listen. In an almost post-pandemic rundown of unicorn market caps, Gil arrives at some important conclusions. America is still the clear front-runner in unicorns followed by China, the EU, and India. Israel, Gil notes, continues to have many unicorns per capita, and Canada has started adding them faster than before. Brazil is the biggest generator of unicorns in Latin America. What stood out in the analysis is that unicorn counting is increasingly moving towards decacorn counting. The concentration of unicorns remains primarily confined to cities regardless of the specific country. If you have been following our Charts of the Week over the last few months, you will have noticed a clear trend in the rise of European unicorns. That’s because the European tech sector doubled in value during the pandemic. It looks like the start of the European mega-deal era. [See Also: How the hedge fund Tiger Global is transforming Silicon Valley; listen also to my discussion with Elad in 2018.]

Cities still drive unicorn creation. Source: Elad Gil

The fugacity of the intangible economy

The exponential economy is an intangible one. More than 80% of the value of the S&P500 is intangible assets, the proportion even higher for tech giants. Macro strategist, Michael Maubossin, posits an interesting idea, that, with my emphasis:

Intangible assets have some characteristics that distinguish them from tangible assets, including greater potential economies of scale and higher risk of obsolescence. The good news is that intangible-intensive companies can grow faster than their tangible counterparts. The bad news is they can also become irrelevant and shrink fast.

That latter warning, which he details in the essay, is an interesting one. It feels too early to talk about how quickly firms built on intangible assets may disappear: Microsoft and Apple haven’t, after all. I wonder whether the nature of network effects sitting on top of a platform, combined with data network effects, creates options for managers to sidestep that irrelevance. Microsoft, after all, missed the Internet and mobile, and is still going strong. Facebook, similarly, has bets in new platforms like virtual reality and online payments. Do those moves suggest a continued relevance? I’d welcome your thoughts in the comments below.  

(For a decent background on intangible assets, read this essay by EV member, Stian Westlake.)

Revisiting the early days of Covid-19

🧬 New research suggests that data from the first Covid-19 wave vastly underestimated the number of pandemic infections in New York. If you look at other hotspots, similar patterns are likely to come to the surface. More concerning is the disappearance of early sequencing data of the virus from shared databases. It’s impossible to know if the claims that Chinese scientists deliberately hid early Covid sequencing data are accurate, but it is clear that obfuscation is taking place. It’s going to be challenging to arrive at sound conclusions over the origins of Covid-19 if the waters are this muddy with misinformation.

Beyond Haber Bosch

🔬 The Haber Bosch process could be the most important inventions in history – since fixing nitrogen gas allowed for the creation of modern fertilisers and the growth in agricultural yields. However, it is a quintessentially industrial age process that requires high temperature and high pressure produced by burning fossil fuels that amount to more carbon emissions. Can we do better? Researchers in Australia have designed a new process that could speed up the production of environmentally friendly ammonia, which is made using renewable energy sources. In an article in Science, an electrochemical route to ammonia could substantially lower the carbon emissions associated with the current thermal Haber Bosch process. [See also: new technologies using microbes and solar power could produce ten times more food than plants with little impact on the environment.]

Controversial ideas about citizens

🗳 The recent intensity of debate and interest in politics belies a more profound decline in political participation and an increasing “degroundedness” in modern notions of citizenship. The pressure of globalised capitalism and the erosion of critical pillars of citizenship like voting or even knowledge of a country’s political history has led the economist Branko Milanovic to ask the rather provocative question: Is citizenship just a rent? The last vestiges of citizenship, in Milanovic’s view, are confined to a stream of income (in the form of benefits) and advantages that “one receives if lucky to have been born or become a citizen of a rich nation.”

One way of testing the thesis could be to change how we vote in liberal democracies. Jason Brennan, a professor of strategy, economics, ethics and public policy at Georgetown University, argues that epistocracy could help countries make better decisions by limited voting access to knowledge. Democracies allow every citizen an equal right to vote, but epistocracies grant this right based on knowledge or competence.

🔋Dept of decarbonisation

CO2 level 418.67 ppm | 3,266 days until we reach the 450ppm threshold

The latest measurement of atmospheric CO2 (as of June 23, 2021): 418.67 ppm; June 25 2020: 415.73 ppm; 25 years ago: 360 ppm; 250 years ago, est: 250 ppm. Share this reminder with your community by forwarding this email or tweeting this.

⛈ In a leaked report from the Intergovernmental Panel on Climate Change (IPCC), scientists warn that climate change is reaching a tipping point sooner than previously assumed. Specifically, the scientists are concerned that global heating is close to triggering “tipping points” in the Earth’s natural systems that will lead to possible “irrevocable disaster” unless decisive action is taken. It’s a damming and frankly scary assessment, but as Professor Katherine Hayhoe reminds us on Twitter, much of the data isn’t new. Events such as “sea-level rise accelerating; drought, heavy rain and extreme heat risks soaring, massive wildfires” have been around for years. What’s different about this report is that the various threads have been brought together and the overall picture is frightening.

Short morsels to appear smart during the next extreme weather event

🕺 Rest of the World published a fascinating look at Factory Tik Tok and the rise of Chinese manufacturing influencers.

🚔 Breathing new life in military innovation, Nato is creating a €1bn fund to create defence startups.  The connection between defence research and technological innovation is a long and storied one, from the chip industry to the Internet, DARPA and, of course, In-Q-Tel, the CIA-backed venture fund.

👩‍💻How will behaviour changes during the pandemic persist after the pandemic ends?

🇯🇵 Speaking of pandemic changes, Japan is another step closer to a 4-day workweek but challenges remain.

🚙 Time to rethink land usage. The United States has eight parking spaces for every car.

🌾 Updates from the Department of Shortages: US manufacturing is ramping up despite shortages of raw material, petrol, and labour.

🤖 The pandemic has been a boon for robotics in e-commerce among giants like Amazon and Alibaba.

⚕️Critical insight into how the Apple Watch is changing healthcare by measuring biomarkers like glucose.

🍎 Quality matters. New research suggests that higher diet quality is connected to decelerated epigenetic ageing.

🍺 Archaeologists at Göbekli Tepe, one of the oldest monuments in human history dating to at least 12,000 years old, have found evidence of advanced grain usage. So much for the Paleo diet?

🐈 Cat ownership has a clear impact on the gut microbiota of owners.

🐙 Octopuses can feel pain. In the eyes of some British lawmakers, this means they need legal protection. (Also in Azeem’s view!)

🌱 How deep is the consciousness of plants? (Deeper than you think).


We’re making progress with our new publishing platform and this means that Friday’s discussion are back! We had a great discussion on electricity pricing and what the new milestones for renewably generated pricing mean. Please check it out.


What you’re up to – notes from EV readers

Jon Leland is leading a global petition for a four day work week with the goal of piloting the week across 20+ companies in 2022.

Abhishek Gupta published an analysis of the current state of affairs and a roadmap for effective carbon-accounting tooling in AI.

Bill Murray and colleagues are running an online summit to explore the power of federated digital twins and cyber-physical infrastructure at a national scale, supported by Royal Academy of Engineering, BEIS, UKRI, Go-Science, Alan Turing Institute, Centre for Digital Built Britain and Robotics Growth Partnership.

To share your projects and updates, fill out your details here. Because of space constraints, we prioritize updates from paying members and startups I have invested in. (You can become the former by subscribing, if you have not already, and the latter by getting an intro to me via a trusted contact.)

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