In modern times, the Gordian Knot has become associated with last week’s blog post theme – namely an epic challenge stimulus which calls for heroic, forceful action. We celebrate the blade that splits asunder and he who wields the blade but we don’t examine the other elements of the legend – the oracles, the signs, and the knot.
On Thursday, my office hosted several would-be Alexanders. Like millions who have been lured to the sirens of “entrepreneurship” and “angel” or “venture” investing I was dealing with several people who were confident that they had devised the solution for things ranging from data encryption to energy to metals to specialized magnetic motors. Joining the chorus in our present lottery-odds Greek tragedy, they sang of solutions to great problems, the promise of riches from their respective technical blades. And, in a style befitting Shakespeare’s rendering of Greek tragedies, many were morose when confronted with the fact that their illusion of uniqueness and creativity was a function of insufficient knowledge of interconnectedness – not invention. Like the innovator heroes of our times, their focus was on the sword and its master – not on the oracle, the signs or the knot. By shifting their focus from the sword to the knot, we actually began a process of a collaborative destiny – kudos to some courageous souls that day.
We are presented with numerous challenges in our time. How do we power our world without toxifying our air and seas? How do we extract minerals without depleting and toxifying water and displacing communities? How do we finance creativity when it has no tangible artifact to have and to hold? How do we determine stewardship of shared resources in the commons? How do we enable endeavors without becoming slaves to reserve-based money? We are, in a word, vexed. In a fifty year economic experiment, we allowed subsidized models of entrepreneurship to be promoted as the keys to wealth creation but we failed to tell the truth about these models. Modern entrepreneurship cannot exist without preferential procurement from governments (the fuel that created the U.S. private equity funding base); preferential tax policy which incentivizes wealth to be placed “at risk” for unlimited upside benefit; subsidized, socialized research (bear in mind that taxpayers fund over 70% of the world’s basic research – not private industry); and an established merger and acquisition market – the fate of most venture backed companies. If any of these conditions are not fully present, incumbent models don’t work.
Market and greed sirens on the rocks engage in a macabre dance which includes “innovators” and “capital”. Buoyed by half-truths and the lure of disproportionate wealth for the few, tens of thousands are devastated when the myths are exposed but, unwilling to expose the fraud to which they succumbed, sit quietly while others follow the same path to disappointment and poverty of spirit (and checkbook). We are, as it was in Phyrgia, a people without the metaphoric leader or king.
However, an ox cart driven by a peasant is on the path. And if we can re-examine the Gordian Knot, we just may be able to create a different narrative.
First, the oracle. The last two years have demonstrated quite clearly that our current model doesn’t work. Evidenced by the recent small business economic development boondoggle promoted by the White House and Congress and its equally ill-conceived cousins in Europe, credit is NOT the problem – Customers (or the lack thereof) is. In our love affair with our projection of “free markets”, we choked off the engine of economic development which is revenue from buyers – even when the purchases represent preferential customer selection. Oh, now some of you free trade wonks out there will howl about how the market should be devoid of these contrivances and manipulations. However, your academic and “think tank” perches from which you criticize were funded by titans of industry who became thus by way of effective monopolies or subsidized markets. So get over your myopic amnesia and get real. We need value to be exchanged between customers and sellers – not indebtedness to tax-subsidized banking interests. And we know that collaboration (whether its called open innovation, crowd-sourcing, or partnership) models are evidencing greater value than the cold-war isolation from innovation enclosure models of the industrial past. In a world where proprietary price controls once gained their efficacy by managing scarcity, we now are in a world where collaborative efficiency in development, production, distribution, and reuse will be the fuel of profitable endeavors.
Second, the signs. The ox cart, the eagle, and the thunderstorm are intriguing and overlooked elements in the Gordian Knot legend. However we ignore them at our wisdom’s peril. The ox cart can be seen as a metaphor for trade and exchange across distances. The eagle can be seen as the collaboration and confirmation of nature. And the thunderstorm can be seen as a metaphor for the natural energy that comes from nature’s dynamism. In modern, Occidental minds, omens are seen as superstitious. However in communities who have a better understanding of nature, signs are appreciated as markers of time, signals for change, and motivators for community adaptation. Many times, they are rather detached from a religious, superstitious or “belief” impulse. Community and culture simply know that when one thing happens, it calls for a change in action. Which of our greatest perceived challenges could not be solved from a renewed appreciation for looking at all the signals, not just the ones that get broadcast from the avatars on CNN, MSNBC, FOX, and Bloomberg? Why has humanity been given the opportunity to have several >7.0 magnitude earthquakes in a single calendar year? Is it to jeopardize our survival or is it an opportunity to learn? Why aren’t we studying why the 7.0 in Papua New Guinea involved no loss of life while the one in Haiti killed thousands? Why aren’t we letting the lessons be learned? And floods, desertification, energy shocks – all can be used as opportunities to learn and change behavior. None of this is possible if we see ourselves as “victims” looking for “hero saviors”.
Finally, the knot. What is notable about the knot is that it was tied as a symbol of gratitude and it was fashioned from living fiber. Quite possibly, the reason why Alexander couldn’t determine the beginning or end is because life had knit the two together. Any horticulturalist can tell you that certain plants and plant material actually seamlessly heal leaving their injury or graft undetectable. But what’s there to learn from the knot? Well, quite simply, it was constructed of multiple, living fibers. And here’s the key. We need to see innovation, capital, enterprise, trade and sustainability as an integrated ecosystem – not in isolation. Small business doesn’t NEED credit. Investors don’t NEED deal flow. To the contrary, we can take the artifacts of our isolation over the past 50 years and weave them into a network across which value can be exchanged by interconnected, inter-dependent efficiencies rather than scarcity based isolation. This means that every person who ever had an idea and wanted to take it to scale but failed, should be invited into a Gordian Trust. Every angel investor who ever put money into a deal (usually backing the person as much or more than the artifact) should be invited to place their deals into the Trust. And every researcher who was certain that just one more spin of creativity would have yielded a result should be invited to place their ideas into the Trust. Then, by explicitly interconnecting the seemingly disparate threads, an ecosystem could be built. This ecosystem would, from our analysis at M•CAM, have a present market value in monetary terms in excess of two trillion dollars based on what we know is in the public domain, sitting unused. And rather than ownership, every steward member of the Trust could participate as a common member of the trust dividing proceeds however they saw fit. Ironically, this would yield a structure that no blade could drive asunder and we just may solve – at long last – the real message in the myth. Maybe a knot, tied in homage to unanticipated success, has its finest destiny as a knot.
The ox cart is coming with an eagle flying in advance of the towering clouds…. FLASH!