Why a Company Can’t “Be More Like a Startup”

This article originally appeared in the Harvard Business Review


As more and more companies face disruption from globalization, new technology, and startups that have more capital than the incumbents, the continuing cry from Wall Street investors is, “Why can’t companies be as innovative as startups?”

Here’s one reason why:

Startups can do anything.

Companies can only do what’s legal.

Startups can do anything
One of the unheralded advantages of a startup is what at first glance appears to be its weakness. Initially, a startup has no business model and no market share to defend. Its employees and investors don’t depend on an existing revenue stream. If they select a business model that targets industry incumbents, they don’t have to worry about upsetting existing customers, partners or distribution channels.

Yet those very weaknesses give startups an overwhelming advantage in innovation.  Startups can try any idea and any business model—even those that are on the surface patently illegal.

At times laws and regulations are in place for the health and safety of consumers. But often the legal obstacles confronting startups have been put in place by companies that look to the government and regulators as their first line of defense against new market entrants. (Existing companies also use network effects of monopolies/duopolies, distribution channel kickbacks, etc., to stifle competition.)

In the past, these anti-innovation tools were sufficient to keep new entrants out. But today, investors realize that companies that depend on regulation and artificial market constraints are actually vulnerable. Once presented with an alternative to the status quo, customers who have been locked into rent-seeking companies flock to innovative startups with business models that provide better service, lower prices, etc. Enormous financial returns are available to startups taking on incumbents, regulators and the law. So, startup investors comfortable making a risk capital bet are actively encouraging startups to go after large, static industries that look prime for disruption.

Here are some of the most visible examples.

Uber – current valuation >$70 billion – knew the day they started that their ridesharing service violated the law in most jurisdictions. Carrying passengers for payment, historically considered commercial use, was regulated in most cities.  In addition, some cities put an artificial limit on the number of taxi operators by requiring them to buy medallions and agree to a set of local regulations.  Uber ignored all of these requirements and reinvented local transportation by offering a more convenient service. Today, New York City has 13,587 yellow-taxi medallions and more than 50,000 Uber and Lyft cars.

PayPal – acquired by eBay three years after it was founded for $1.5 billion – started as a money transfer system for buyers and sellers on eBay. Banks protested that PayPal was an unregulated bank; and of course, are regulated by the federal government and states. As PayPal grew, incumbent banks forced it to register in each state. Ironically, once PayPal complied with state regulations by registering as a “money transmitter” on a state-by-state basis, it created a barrier to entry for future new entrants.

Airbnb – current valuation $31 billion – allows people to rent out their homes, rooms or apartments to visitors. Not surprisingly Airbnb violates local housing laws and regulations in many cities.  None of the renters pay hotel or tourist tax.  Every Airbnb rental is a lost night of revenue for hotels that hate it.  The company has more rooms available then any hotel chain.

Tesla – current valuation $50 billion – sells cars directly through its own distribution channel. To protect auto dealerships in the 1920s, direct sales by an automobile manufacturer were made illegal in most states in the U.S.  Because Tesla believed that existing auto dealers would have no incentive to sell electric cars, they created an alternative option for consumers.

Companies can do anything legal
In the 20th century companies worried about increasing their market share, profit margins, return on investment and return on net assets. They tenaciously protected their existing markets from other existing companies that were using the same business model. They very rarely worried about disruption from new firms as the barriers to entry (financial, legal, regulatory) were so high.

Ironically once companies become locked in their entrenched market positions, it became difficult for them to compete by breaking the same laws or untangling their existing channel relationships. In contrast to startups, companies are constrained by local, state and federal laws and regulations.  The risk of breaking laws can result in large penalties and shareholder lawsuits.  The Justice Department and State Attorneys General find large companies attractive targets.

As a consequence, one of the roles of the legal department in large corporations is to protect the company from straying into any legal or regulatory danger. (For example, when Volkswagen discovered their diesel cars couldn’t pass U.S. pollution standards, it faked the tests by programming cars to pass inspections. However, in normal driving these cars put out over 40 times the allowed nitrous oxide pollutants allowed by law.  After it was discovered, legal penalties cost Volkswagen $18 billion and several indicted executives.)

Yet trying to stay within the legal lines companies paint themselves into a corner by creating their own internal barriers to innovation. Instead of innovating, most industries being disrupted turn to litigation.

To compete with Tesla’s direct sales to consumers, GM, Ford, and the rest of the auto industry either have to shut Tesla out of selling directly to consumers or they have to abandon their own dealer networks and sell directly as well. It’s an untenable and unsustainable position as consumers find car salesmen to be one of the least trusted groups. To defend their dealer network, car makers decided to litigate instead of innovating.

Taxi companies needed to start copying Uber’s business model but instead they turned to lobbyists and legislation to convince cities that deregulated ridesharing was a bad idea.

Hotel chains burdened with even a greater capital investment in their physical buildings are doing the same thing.

Corporations using existing business models have people, processes and revenue goals that can’t be changed overnight. These incumbents tend to have short-term goals and incentives (stock price, quarterly earnings, year-end bonuses) and often fail to recognize that more money can be made on new platforms and new distribution channels. In each case litigation versus innovation is seems obvious choice.

What can a company do?
The introduction of new technology has always been disruptive to existing markets, particularly to those who sell through well-established distribution channels and have extensive capital equipment and fixed investments. But today, as disruption happens faster, and is funded at enterprise scale, companies need to figure how to create a portfolio of innovation. They can do so by first identifying technology trends with innovation outposts located in technology centers; second, by investing in early-stage disruptors; third – buying disruptors and keeping their innovation culture and people; while fourth, creating an innovation culture internally that disrupts their own business model before others do.

We Have A Moral Obligation

I was in Boston and was interviewed by The Growth Show about my current thinking about innovation in companies and government agencies.The interviewer was great and managed to get me to summarize several years of learning in one podcast.

It’s worth a listen.

At the end of the interview I got surprised by a great question – “What’s the Problem that Still Haunts You?”  I wasn’t really prepared for the question but gave the best answer I could on the fly.

Part of the answer is the title of this blog post.

Listen to the entire interview here:
Taking the Lean Startup From Silicon Valley to Corporations and the State and Defense Department

Or just parts of the interview:
1:20  Failure and Lessons Learned

Tesla Lost $700 Million Last Year, So Why Is Tesla’s Valuation $60 Billion?

Automobile manufacturers shipped 88 million cars in 2016. Tesla shipped 76,000. Yet Wall Street values Tesla higher than any other U.S. car manufacturer. What explains this more than 1,000 to 1 discrepancy in valuation?

The future.

Too many people compare Tesla to what already exists and that’s a mistake. Tesla is not another car company.

At the turn of the 20th century most people compared existing buggy and carriage manufacturers to the new automobile companies. They were both transportation, and they looked vaguely similar, with the only apparent difference that one was moved by horses attached to the front while the other had an unreliable and very noisy internal combustion engine.

They were different. And one is now only found in museums. Companies with business models built around internal combustion engines disrupted those built around horses.  That’s the likely outcome for every one of today’s automobile manufacturers. Tesla is a new form of transportation disrupting the incumbents.

Here are four reasons why.

Electric cars pollute less, have fewer moving parts, are quieter and faster than existing cars. Today, the technology necessary (affordable batteries with sufficient range) for them to be a viable business have all just come together. Most observers agree that autonomous electric cars will be the dominate form of transportation by mid-century. That’s bad news for existing car companies.

First, car companies have over a century of expertise in designing and building efficient mechanical propulsion systems – internal combustion engines for motive power and transmissions to drive the wheels. If existing car manufacturers want to build electric vehicles, all those design skills and most of the supply chain and manufacturing expertise are useless. And not only useless but they become this legacy of capital equipment and headcount that is now a burden to a company. In a few years, the only thing useful in existing factories building traditional cars will be the walls and roof.

Second, while the automotive industry might be 1000 times larger than Tesla, Tesla may actually have more expertise and dollars committed to the electric car ecosystem than any legacy car company. Tesla’s investment in Lithium/Ion battery factory (the Gigafactory), its electric drive train design and manufacturing output exceed the sum of the entire automotive industry.

Third, the future of transportation is not only electric, it’s autonomous and connected. A lot has been written about self-driving cars and as a reminder, automated driving comes in multiple levels:

  • Level 0: the car gives you warnings but driver maintains control of the car. For example, blind spot warning.
  • Level 1: the driver and the car share control. For example, Adaptive Cruise Control (ACC) where the driver controls steering and the automated system controls speed.
  • Level 2: The automated system takes full control of the vehicle (accelerating, braking, and steering). The driver monitors and intervenes if the automated system fails to respond.
  • Level 3: The driver can text or watch a movie. The vehicle will handle situations that call for an immediate response, like emergency braking. The driver must be prepared to intervene within some limited time, when called upon by the vehicle.
  • Level 4: No driver attention is ever required for safety, i.e. the driver may safely go to sleep or leave the driver’s seat.
  • Level 5: No human intervention is required. For example, a robotic taxi

Each level of autonomy requires an exponential amount of software engineering design and innovation. While cars have had an ever-increasing amount of software content, the next generation of transportation are literally computers on wheels. Much like in electric vehicle drive trains, autonomy and connectivity are not core competencies of existing car companies.

Fourth, large, existing companies are executing a known business model and have built processes, procedures and key performance indicators to measure progress to a known set of goals. But when technology disruption happens (electric drive trains, autonomous vehicles, etc.) changing a business model is extremely difficult. Very few companies manage to make the transition from one business model to another.

And while Tesla might be the first mover in disrupting transportation there is no guarantee they will be the ultimate leader. However, the question shouldn’t be why Tesla has such a high valuation.

The question should be why the existing automobile companies aren’t valued like horse and buggy companies.

Lesson Learned

  • Few market leaders in an industry being disrupted make the transition to the new industry
  • The assets, expertise, and mindset that made them leaders in the past are usually the baggage that prevents them from seeing the future

Hacking for Defense @ Stanford 2017 – Lessons Learned Presentations

We just finished our second Hacking for Defense class at Stanford. Eight teams presented their Lessons Learned presentations.

Hacking for Defense is a battle-tested problem-solving methodology that runs at Silicon Valley speed. It combines the same Lean Startup Methodology used by the National Science Foundation to commercialize science, with the rapid problem sourcing and curation methodology developed on the battlefields in Afghanistan and Iraq by Colonel Pete Newell and the US Army’s Rapid Equipping Force.

Goals for the Hacking for Defense Class
Our primary goal was to teach students entrepreneurship while they engaged in a national public service. Today if college students want to give back to their country they think of Teach for America, the Peace Corps, or Americorps or perhaps the US Digital Service or the GSA’s 18F. Few consider opportunities to make the world safer with the Department of Defense, Intelligence Community or other government agencies.

Our second goal was to teach our sponsors (the innovators inside the Department of Defense (DOD) and Intelligence Community (IC)) that there is a methodology that can help them understand and better respond to rapidly evolving asymmetric threats. That if we could get teams to rapidly discover the real problems in the field using Lean methods, and only then articulate the requirements to solve them, could defense acquisition programs operate at speed and urgency and deliver timely and needed solutions.

Finally, we also wanted to show our sponsors in the Department of Defense and Intelligence community that civilian students can make a meaningful contribution to problem understanding and rapid prototyping of solutions to real-world problems.

The Class
Here’s a brief description of the Lean Methodology our students used:

If you can’t see the video click here

Our mantra to the students was that we wanted them to learn about “Deployment not Demos.” Our observation is that the DOD has more technology demos than they need, but often lack deep problem understanding.  Our goal was to have the students first deeply understand their sponsors problem – before they started building solutions. As you can imagine with a roomful of technologists this was tough. Further we wanted the students to understand all parts of the mission model canvas, not just the beneficiaries and the value proposition. We wanted them to learn what it takes to get their product/service deployed to the field, not give yet another demo to a general. This meant that the minimal viable products the students built were focused on maximizing their learning of what to build, not just building prototypes.

(Our sponsors did remind us, that at times getting a solution deployed meant that someone did have to see a demo!)

The Hacking for Defense class was designed as “fundamental research” to be shared broadly and the results are not subject to restriction for proprietary or national security reasons. In the 10 weeks the students have, Hacking for Defense hardware and software prototypes don’t advance beyond a Technology Readiness Level 4 and remain outside the scope of US export control regulations and restrictions on foreign national participation.


  • Eight teams spoke to over 800 beneficiaries, requirements writers, program managers, warfighters, legal, security, customers, etc.
  • Seven out of the eight teams realized that the problem as given by the sponsor really wasn’t the problem. Their sponsors agreed.
  • Received from a problem sponsor mid-live stream broadcast “we are working funding for this team now.”
  • Over half the student teams have decided to continue working on national security projects after this class.

This is the End
Each of the eight teams presented a 2-minute video to provide context about their problem and then gave an 8-minute presentation of their Lessons Learned over the 10-weeks. Each of their slide presentation follow their customer discovery journey. All the teams used the Mission Model Canvas, Customer Development and Agile Engineering to build Minimal Viable Products, but all of their journeys were unique.

The teams presented in front of several hundred people in person and online.

21st Century Frogman

If you can’t see the video click here


The video of the team presenting is below.  You can see all their slides right below this video.

If you can’t see the video click here


If you can’t see the presentation slides click here



VA Companion

If you can’t see the video click here


The video of the team presenting is below.  You can see all their  slides right below this video

If you can’t see the video click here


If you can’t see the presentation slides click here



Austra Lumina

If you can’t see the video click here


The video of the team presenting is below.  You can see all their  slides right below this video

If you can’t see the video click here


If you can’t see the presentation slides  click here




If you can’t see the video click here


The video of the team presenting is below.  You can see all their slides right below this video

If you can’t see the video click here


If you can’t see the presentation slides click here




If you can’t see the video click here

The video of the team presenting is below.  You can see all their slides right below this video

If you can’t see the video slides click here


If you can’t see the presentation click here




If you can’t see the video click here

The video of the team presenting is below.  You can see all their slides right below this video

If you can’t see the slides click here



If you can’t see the presentation slides click here




If you can’t see the video click here


The video of the team presenting is below.  You can see all their slides right below this video

If you can’t see the slides click here


If you can’t see the presentation slides click here

The Innovation Insurgency Spreads
Hacking for Defense is now offered at eight universities in addition to Stanford – Georgetown,  University of Pittsburgh, Boise State, UC San Diego, James Madison University, University of Southern Mississippi, and later this year University of Southern California and Columbia University. We established Hacking for Defense.org a non-profit, to train educators and to provide a single point of contact for connecting the DOD/IC sponsor problems to these universities.

The Department of Defense has expanded their use of Hacking for Defense to include a classified version, and corporate partners are expanding their efforts to support the course and to create their own internal Hacking for Defense courses.

Another surprise was how applicable the “Hacking for X…” methodology is for other problems. Working with the State Department we offered a Hacking for Diplomacy class at Stanford.

Both the Defense and Diplomacy classes created lots of interest from organizations that have realized that this “Hacking for X…” problem-solving methodology is equally applicable to solving public safety, energy, policy, community and social issues internationally and within our own communities. This fall a series of new “Hacking for X…” classes will address these deserving communities. These include:

If you’re interested in learning how to apply a “Hacking for X…” class in your workplace or school we’ve partnered with the 1776 incubator in Washington DC to offer a 2-day “Hacking for X…” certification course 26-27 July for those interested in learning how. Sign up here.

It Takes a Village
While I authored this blog post, these classes are a team project. The teaching team consisted of:

  • Joe Felter a retired Army Special Forces Colonel with research and teaching appointments at Stanford’s Center for International Security and Cooperation (CISAC), the Hoover Institution, and the dept. of Management Science and Engineering. Joe is the incoming Deputy Assistant Secretary of Defense for South and Southeast Asia.
  • Pete Newell is a retired Army Colonel currently a Senior Visiting Research Fellow at the National Defense University’s Center for Technology and National Security Policy and CEO of BMNT Partners.
  • Steve Weinstein a 30-year veteran of Silicon Valley technology companies and Hollywood media companies.  Steve is CEO of MovieLabs the joint R&D lab of all the major motion picture studios.

Our teaching assistants were all prior students: Issac Matthews our lead TA, and Melisa Tokmak, Jared Dunnmon, and Darren Hau.

We were lucky to get a team of 25 mentors (VC’s and entrepreneurs) who selflessly volunteered their time to help coach the teams. Thanks to the team Lean Startup mentors: Paul Dawes, Tom Bedecarre, Kevin Ray, Craig Seidel, Daniel Bardenstein, Roi Chobadi, Donna Slade, and Rafi Holtzman and other advisors; Lisa Wallace, Peter Higgins, Steve Hong, Robert Medve.

We were privileged to have the support of an extraordinary all volunteer team of professional senior military officers representing all branches of service attending fellowship programs at Stanford’s Hoover Institution, and Center for International Security and Cooperation (CISAC) and Asia Pacific Research Center (APARC) at the Freeman Spogli Institute (FSI). These included: Colonel Lincoln Bonner (US Air Force), Colonel Curtis Burns (US Army), Captain Kurt Clark (US Coast Guard), Lieutenant Colonel Kurt Helphinstine (US Air Force), Colonel Seth Krummrich (US Army)), Commander Leo Leos (US Navy), Lieutenant Colonel Eric Reid (US Marine Corps), Colonel Mike Turley (US Army), and Colonel Dave Zinn US Army.  Additional volunteers from the active duty military providing support to our teams included  Lieutenant Colonel Donny Haseltine (US Marine Corps), Captain Jason Rathje (US Air Force), Major Dave Ahern US Army) and, Major Kevin Mott (US Army).

And finally a special thanks to our course advisor Bill Perry, former Secretary of Defense and Professor Emeritus, and Tom Byers, Professor of Engineering and Faculty Director, STVP.

Dalhousie University Commencement Speech – 2017

Light a path for the better angels

Thank you, Chancellor McLellan, President Florizone, Dean Charlebois, Dr. Hewitt, and Dr. Kilfoil for the invitation to speak today and thank you for the honorary degree.

I’m honored to speak at a university whose motto is: Pray and Work.
It’s pretty close to the one I had as an entrepreneur, which was – Pray it Will Work.

First, my congratulations. Your degree is a big deal. This is your day, not mine.

At worst, a commencement speaker is all that stands between you and lunch. At best, I can give you something to think about as you embark on the next chapter in your life.

What, I wondered, would I have said to a group of graduates living on the edge of a revolution the day writing was invented, or the year after Gutenberg printed the first book, or when radio reached into the homes of millions.  What advice would I have given to those about to enter a world no one had ever experienced?

Whether you like it or not, or know it or not, you’re coming of age at just that extraordinary time in human development.

Let me be honest about my bias.  I love technology. I’ve spent my life at the center of innovation in Silicon Valley –  doing eight startups in 21 years, and the last 15 years in academia teaching others innovation and entrepreneurship. I was present at the creation of the first microprocessors, participated in the PC revolution, built video games, and shipped software on the first Internet browsers. And I’ve watched how, in a blink of an eye, technology went from products used by the very few, to ending up in the pockets of billions, bringing social change and corporate disruption.

But nothing, absolutely nothing, I’ve experienced, will come close to what you’re going to see.

Only a few generations have been granted the role of determining whether a revolution in communication will allow our better angels – or our darker angels – to win. You leave here with incredible opportunity, but also with immense responsibility.

Half the world now owns a smartphone. On an average day, you’ll look at your phone over 200 times. You’ve gone through college interacting with your friends and connecting to the world using Facebook, Instagram, WhatsApp, Snapchat, Twitter, Tinder, Pandora, Pinterest, Uber, YouTube and other apps I don’t even know. Living “phone forward” and connecting to the world through this software seems normal – to you.

You communicate, interact and network with each other in a way that’s unique in the history of our species. Faster, with infinitely more data, in shorter bursts, with more connections to more people and places.

We now know that the way we consume information changes our brains. Whether new forms of communication physically change our gray matter, or just cause us to use different parts of it, is still open to debate. But clearly, our brains process information differently depending on the form of communication we’re engaged in.

Your brains have been rewired to process all this Net-based information. Your brains are dealing with the world in a different way than humans ever have.

That kind of profound shift has occurred only six times in the entire 200,000-year history of Homo Sapiens. And you, here today, are the vanguard of the seventh wave.

Each time this happened, the human race made major leaps forward. Your generation, all of you graduating today, are our unintended science experiment. Have we have given you a gift or a curse?

Let’s look at what happened the six other times our brains were rewired.

If you remember from your anthropology class, modern humans emerged about 200,000 years ago, and with them, spoken language. For the next 195,000 years, we passed information on to one another via stories. You sat by a fire, looked at the stars and listened to a storyteller recount creation myths, hero myths and stories for entertainment, and your imagination was engaged as you filled in the details.

Over thousands of years, these storytellers rewired their own brains into something different from those who were simply listening. Storytellers trained to memorize outrageously long narratives, more than most humans alive today can.

Storytellers had new brains.

After more than 100,000 years of telling stories, something unprecedented happened. A few merchants in the Mideast created writing, at first to keep track of crops.

I think it’s appropriate to remind a university class that some of the oldest written inscriptions were not only about crops, but also the celebration of beer.

With written text, the minds of the readers required a whole new way of processing information. We now had to first learn how to read, and then we had to understand what the words were trying to tell us.

Readers and writers of language had new brains.

The written word also meant that information could now be standardized. Our better angels blossomed.

We could formalize laws, create religious texts, and communicate orders to coordinate activities farther than the spoken word could travel. Written language enabled the creation of large societies and with them, governments.

Our darker angels also found ways to use the written word – to dominate and oppress others.

But in 1440, Gutenberg rocked the world when he invented the printing press.

Until the middle of the 15th century, most people couldn’t read. The mass production of books changed that. Within 50 years, books created an information explosion across Europe – 10’s of thousands of titles, and 10’s of millions of copies of books. Our better angels soared as printed books became the Internet of the Renaissance.

Readers of books now had new brains.

And mass production of printed books fueled a reconfiguration of our society, not just our brains. With the printing press, it only took a couple of months to spread Martin Luther’s 95 Theses over much of northern Europe. The result was the Protestant Reformation, which ushered in a new era of political, intellectual and cultural change.

Our darker angels were frightened by the free and unfettered access to information – and banned books – and burned heretics that challenged church and state dogma.

It took about two centuries from the appearance of the book to the emergence of what we would now call newspapers – mass communication had arrived.

The first weekly newspapers appeared in Italy and Germany, and quickly spread through Europe.

In Canada, the first newspaper ever was right here – the Halifax Gazette.

By the end of the 19th century mass circulation papers had developed the characteristics that your parents would recognize today—headlines, illustrations, entertaining stories – all designed to shortcut critical thinking, and stir passion and emotion to sell newspapers and, of course, advertising.

Now, newspaper readers had a daily or weekly stream of “clickbait” headlines.

Readers of newspapers had new brains.

The next wave was Radio. It gave us instantaneous communication to national audiences.  Advertisers immediately figured out how to turn those engaged audiences into consumers. And some governments learned how to turn radio into a weapon of mass deception.

Radio meant that we could now hear the voices of storytellers again. As our brains were newly engaged, our imaginations were required to translate the spoken words into mental pictures.

Listeners to radio had new brains.

It wasn’t more than 30 years from widespread radio that television came onto the scene. TV was something different than just radio with voices.

Our better angels shined a light into homes and battlefields across the world. It changed for the better how we viewed race, gender and class.

But our darker angels dimmed our imaginations. We could gaze all evening and disengage our brains.

Viewers of television had new – and slightly diminished –  brains.

For decades, the phrase “As seen on TV” sold as many products as it obliterated much critical thinking.

Not only did this work for commercial products, but it also extended to politicians.  A handsome, young, telegenic politician could capture a country.

And that brings us to today.

I don’t have to explain the Internet to you. You live it, you’re immersed in it. But let me take a minute to contrast it with the world I grew up in. I spent my first seventeen years in a city where there were just three major TV channels, three major newspapers, and no Internet. If I wanted to look something up, I had to go to library.  If I wanted to connect with a friend, I used a hardwired phone at a desk at home, or paid for each call by physically putting money into a phone in a booth.  And that was in New York City.  The rest of the world had much, much less.

The Net is like we invented writing, the printing press, radio, TV and the Internet in the same decade.  That’s the world you’re graduating into – immersed in social media, with infinite facts and continuous news.

The seventh wave in communication and brain rewiring has arrived. You think and process things differently from how your parents, grandparents and any other humans who have ever lived.

When each of the other six waves initially arrived, the early adopters were the more agile outliers. But ultimately, governments and companies figured out how to master the new technology and individuals lost, as the power of the state, and power of profit, controlled the new media. The same is true for the Internet.

Today, China, Russia, North Korea and other countries have locked their citizens behind a great firewall. They control what their citizens can see and access. Yet at the same time, Facebook, Google, Twitter and the rest of social media capture more personal information on you than any government security agency — except their goal is to profit from your presence.

So, What Does This Mean For You?
You’ve been in a university where information distribution in your classroom was not a democracy. There were voices of expertise and authority, you had certified data providers called professors. You didn’t vote on whether you believed what you were taught; in fact, you were graded on how well you understood it.

But you’re entering a world where you won’t have such certainty. Let me give you an example of the challenges you are going to face in a 24/7 Internet world on a personal level, as a citizen, and in your career.

You deal in streams of short-form information – 140 characters, pictures and messages that disappear. The question for you is: how will you deal with issues that are more complex than soundbites, and require deep dives?

Every generation has had to deal with “fake news” – deliberate misinformation spread by storytelling, books, newspaper, radio and TV. It had different names in the past — “yellow journalism,” propaganda, misinformation.

But unlike in previous generations, fake news today is like a social disease – you catch it from your “friends.”

And the feeling of validity that comes from hearing something from someone you know makes social media much more powerful than what you see on TV or read in a newspaper.

In your generation, Facebook is one of the leading sources of fake news. And that’s a shame, since Facebook is not a news source, it doesn’t originate news, it’s just a distributor of news – one designed to get you to spend time on their site, click on their ads and gather your personal information.

Today, AP and Bloomberg already have bots that write sports stories and earnings reports. Soon machines will make the news by optimizing stories for clicks. Before long computers will create fake videos – and we won’t be able to tell the difference between what was created by a human and what’s computer generated.

What kind of skills will you need to operate in a world of real and fake manufactured data coming from friends? Will you vote for people who value facts or manufacture them?

Will you let darker angels win as you add fire to the flame, or will you seek out and spread real news?

We’ve become digital junkies.
Information consumption and engagement with social media means these platforms have become your emotional drug dealers. “Likes” and thumbs up and posting on social media are addictive, at times like a chemical dependency. They provide immediate rewards after each interaction. They prey on the “fear of missing out” – of the moment or event. Your sense of identity and your values are now validated by a crowd.

Research shows that talking about your own views generates more emotional rewards than listening to conflicting ones. This becomes a self-reinforcing system as you seek out sources of information and other people that support your world view.  It creates a polarized world.

Addiction is one of our perpetual dark angels. You need a purpose-driven life to survive in a world where social media is monetizing both your emotions and your time spent looking at ads.

Finally, the Net has the power to pull us apart as well as bring us together
Each wave in the last 200,000 years – storytelling, writing, books, newspapers, radio, TV and the Net – started with the optimistic view that if we could communicate faster and more efficiently it would bring out the better angels of our nature. We could be more cohesive, we could be smarter, we could learn new things that would help us make the world a better place. All these things happened, and yet…

At each step forward, our darker angels found a way to use these tools, too.

In spite of that, today the human race is in a better place than in any time in human history. Each advancement in our capabilities to communicate gave us the ability to reject a world dominated by violence and ignorance for a world where knowledge and cooperation drove civilization forward.

Most revolutions are not obvious when they happen. When the first scribe wrote on a tablet, no one said, “This is the day everything changes.”  When the first Bible came off Gutenberg’s press, no one said, “There will be billions of these.”

I do not believe that any of you would exchange places with any other generation.

But the question is whether you’ll tell your children that this decade was the beginning of a new dark age, or whether it was the time of something new and wonderful. When it was the time the Internet and social media allowed us to work faster and more collaboratively. When scientific discoveries and technological breakthroughs were integrated into the fabric of society faster than they had ever been before. And when how businesses operated changed forever.

Now graduates of 2017, as you turn back to your phones, light a path for the better angels. The world is counting on you.

Thank you.

If you can’t see the video click here

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