Yuri van Geest - Co-Author Exponential Organizations

- Dutch Ambassador of SU

- Managing Director of the

Singularity University Summit Europe

- Co-Founder Quantified Self Europe

- Co-Founder Lean Startup Machine NL

Facebook’s internet.org - Internet Access Globally

Others: - Google’s Project Loon

(with Titan Aerospace) - Drones & Balloons

- Virgin Galactic's LauncherOne - Satellites

- SpaceX - Satellites

Quirky & GE: Wink - Smart Home

Other Platforms: - SmartThings - Belkin WeMo - Nest/Google Brillo - Insteon - Staples Connect - Apple HomeKit - IKEA Home Smart

IKEA & IDEO - Smart Kitchen Concept

The Big 3 - Connected Car Platforms

Telefónica Research: by 2020, 90 percent of vehicles will have built in connectivity

Google & Levi’s: Project Jacquard - Smart Fabrics

21 Inc - Machine-to-machine Bitcoin transactions

Largest Bitcoin startup investment to date: $116M by Peter Thiel, Andreessen Horowitz, Khosla Ventures, etc.

Exponential Technologies

3D Printing

$40.000 (2007) $100 (2014)

400x cheaper in 7 years

Exponential Technologies

$500.000 (2008) $22.000 (2013)

23x cheaper in 5 years

Industrial Robots

Exponential Technologies

Biotech (DNA Sequencing)

10,000x cheaper in 7 years

Exponential Technologies

Declining Costs Increasing Capabilities

“The average half life of a business competency has dropped from 30 years in

1984 to 5 years today.”

“89% of the Fortune 500 companies from 1955 are

not on the list today.”

“The average lifespan of an S&P 500 company has

decreased from: 67 years (1920’s) to 15 years (today).”

“In the next 10 years 40% of all S&P 500

companies will disappear from this list”

Market Cap to a Billion

Why are there ExOs?

Linear > Exponential

Scarcity > Abundance

Time to scale the organization

Source: McKinsey 7S model

What are ExOs?

An Exponential Organization (ExO) is one whose impact (or output) is disproportionally large — at least 10x larger — compared to its peers because of the use of new organizational techniques that leverage exponential technologies.

Definition

Software is eating the world, in all sectors In the future every company will become a software company

Mark Andreessen founder of Netscape, renowned Venture Capitalist Andreessen-Horowitz

ExOs: Everything will become digital

• social, mobile & online for front-end functions

• nanotech, robotics, 3D printing, sensors, AI

• crowdsourcing (leveraging the crowd), DIY*, P2P**, crowd companies, AI, Nanofactories

• *Do-It-Yourself: Movement of people who create things without the help of experts or professionals

•**:Peer-to-Peer: a decentralized network leveraging direct interactions between people

Attributes

Linear vs Exponential

Top-down, hierarchical Flat, distributed authority (Holacracy)

Linear vs Exponential

Financial driven, closed (Status Quo)

MTP driven, transparent via dashboards

Linear vs Exponential

Strategy based on extrapolation from past

(5-year plans)

Strategy based on MTP and customer insights

Linear vs Exponential

Linear, sequential thinking

Experimentation and feedback loops

Linear vs Exponential

Process inflexibility and risk intolerance

Flexibility and smart failure celebration

Linear vs Exponential

Innovation from inside, large number of FTEs

Innovation at the edges and from outside sources

Examples of ExOs

ExO Score ExO Score

1 GitHub 76 11 Shapeways 72

2 Airbnb 74 12 Kiva.org 72

3 Uber 73 13 Etsy 72

4 Indiegogo 73 14 Cloudera 71

5 Google 73 15 Waze 71

6 Quirky 72 16 Kickstarter 71

7 Kaggle 72 17 BlaBlaCar 71

8 Pinterest 72 18 Medium 71

9 Reddit 72 19 Valve 70

10 Tumblr 72 20 Wikimedia 70

Best ExOs

See the complete Top 100 at: http://top100.exponentialorgs.com

MTP

Staff on Demand Interfaces

Community & Crowd Dashboards

Algorithms Experimentation

Leveraged Assets Autonomy

Engagement Social

GitHub - GitHub is an open source code and collaboration community with 10 million members, 21 million repositories and market cap of $10B. Key differentiator: technical infrastructure of the internet as organizational design

Best ExOs

MTP

Staff on Demand Interfaces

Community & Crowd Dashboards

Algorithms Experimentation

Leveraged Assets Autonomy

Engagement Social

Xiaomi - Chinese smartphone company, focusing on performance, quality and customer experience. Has a flat organization consisting of 5.000 employees and leverages a Community of 100 million fans for product ideation & iteration.

Best ExOs

Fortune 100 as ExOs ?

Fortune 100 ExO Top 10

Google 72.9 Amazon 66.2 Apple 62.6 International Business Machines (IBM) 61.0 Verizon Communications 58.8 General Electric 56.6 Microsoft 55.9 Cisco Systems, Inc. 55.8 The Walt Disney Company 54.8 Oracle Corporation 54.0

Fortune 100 ExO Lowest Scores

Marathon Petroleum 32.3 Costco Wholesale 32.0 Philip Morris International Inc. 31.6 Hess Corporation 31.3 HCA Holdings, Inc. 31.0 Phillips 66 30.7 Tesoro Corporation 30.0 Valero Energy 29.8 Plains GP Holdings, L.P. 27.5 Energy Transfer Equity, L.P. 26.5 Enterprise Products Partners L.P. 23.0

MTP

Staff on Demand Interfaces

Community & Crowd Dashboards

Algorithms Experimentation

Leveraged Assets Autonomy

Engagement Social

Haier - Chinese appliance maker with 80,000 employees organized in 2005 in 2,000 self-managed units with decision-making authority (Autonomy). Market cap grew from $20B to $60B today in the last 3 years.

Corporate Example

Rent, don’t own assets, people & resources Marginal cost of supply is dropping exponentially for the first time ever (besides marginal costs of demand) >>> double viral loops or network effects

Takeaways

Impact of ExOs

Performance Improvement

Airbnb Traditional Hotels

90x more listings per employee

Performance Improvement

Quirky: 29 days Traditional: 300 days

10x faster product development

Performance Improvement

Local Motors Traditional Car Manufacturers

1000x cheaper & 5-22x faster production

Market Cap improvement (2011 - today)

$20B | 10x $400B | 2,5x $7B | 14x

$46B | 46x $41,2B | 20,5x

$19B | 19,000x +

$2B | 40x

$1B (2013) | 50x

Future Outlook

Future Organizations

• Leverage Blockchain • Distributed Autonomous Organizations (DAOs/DACs) • Algorithmic Corporations • RoboCorps

In 2015: Translations in 12 languages

Yuri van Geest Co-Author Exponential Organizations

+31 6 113 19 290 @vangeest

Yuri.vangeest@singularityu.org

www.exponentialorgs.com