FF Daily #531: The right age for entrepreneurship

November 24, 2021: AR fights VR in the metaverse; How to choose a doctor; Fake news

Founding Fuel

[From Unsplash]

Good morning,

Most mainstream narratives have it that the young and impatient are changing the world. But Philips Delves Broughton presents a counter narrative in How to Think Like an Entrepreneur and asks if we’ve thought about ideas such as competence and the meaning of human capital.  

“Research into the motivations and backgrounds of American entrepreneurs published in 2013 found that the average age at which they started their first companies was forty. Nearly 70% were married at the time, and nearly 60% had at least one child. Not exactly Moritz’s ideal. The discrepancy might be explained by the fact that entrepreneurs and venture capitalists choose each other. VCs take a portfolio approach to investing. They expect nine out of ten of their investments to fail, and to be covered by one gigantic hit… They love the young and the hungry.

“Older entrepreneurs are less willing to be included in a portfolio where the expectations of success are so low. They bring experience and industry know-how and perhaps their own capital. They likely have more to lose than an entrepreneur in his early twenties. Not only do the VCs have less need for them, they have less need for the VCs.

“But rather than thinking about a particular age at which it is best to become an entrepreneur, it is more useful to identify the moment when you have the energy and competence required to start your enterprise in balance.

“Energy is the easy part to measure. As we become older, our capacity to stay up late, to put in long hours, to slug back burnt coffee straight from the pot and pop glucose supplements deep into the night, diminishes…

“Competence is more complicated. There is straightforward technical competence, knowledge of computer programming, for example, which can be acquired by teenagers, who can create an application and sell it for millions. But that is different from building a business. For that, different kinds of competence are required. First, you need credibility to attract investors and employees to your idea. Then, you might need managerial experience to build your organization… The economist Gary Becker applied the term ‘human capital’ to this field, the sum total of our education, training, health and subtler qualities emerging from experience.” 

Interesting, isn’t it?

In this issue

  • AR fights VR in the metaverse
  • How to choose a doctor
  • Fake news

AR fights VR in the metaverse

Wired has an insightful interview with John Hanke, CEO and founder of Niantic Labs, best known for the AR game Pokeman Go. Earlier this year, in August, he published a post—a manifesto—on his company blog titled, “The Metaverse Is a Dystopian Nightmare. Let’s Build a Better Reality.” Metaverse has since become popular especially after Facebook changed its name to Meta, and shared its vision for the future. Wired questioned Hanke on his own vision for the metaverse. Here’s an extract.  

Why do you call the metaverse dystopian?

John Hanke: It takes us away from what fundamentally makes us happy as human beings. We’re biologically evolved to be present in our bodies and to be out in the world. The tech world that we’ve been living in, as exacerbated by Covid, is not healthy. We’ve picked up bad habits—kids spending all day playing Roblox or whatever. And we’re extrapolating that, saying, “Hey, this is great. Let’s do this times 10.” That scares the daylights out of me.

Whereas you want people to actually experience daylight, albeit with a phone in their hands.

I really got into this idea of using digital tech to reinvigorate the idea of a public square, to bring people off the couch and out into an environment they can enjoy. There’s a lot of research that supports the positive psychological impact of walking through a park, walking through a forest—just walking. But now we live in a world where we have all this anxiety, amplified by Covid. There’s a lot of unhappiness. There’s a lot of anger. Some of it comes from not doing what our bodies want us to do—to be active and mobile. In our early experiments, we got a lot of feedback from people who were kind of couch potatoes that the game was causing them to walk more. They were saying, “Wow, this is amazing, I feel so much better. I’m physically better, but mentally I’m way more better. I broke out of my depression or met new people in the community.” We said, “Wow, like, this is good we can do in the world.”

Dig deeper

How to choose a doctor

A thought experiment on how to choose the right doctor by Jan Hendrick Kirchner, a doctoral student in computational neuroscience, got our attention. This is a problem most of us must deal with at some point in our lives. What we liked is that he has designed the experiment such that the outcomes that emerge from the decision making process can be extrapolated to other domains as well where we must deal with experts.  

“You are very rich and you want to make sure that you stay healthy. But you don't have any medical expertise and, therefore, you want to hire a medical professional to help you monitor your health and diagnose diseases. The medical professional is greedy, i.e. they want to charge you as much money as possible, and they do not (per se) care about your health. They only care about your health as far as they can get money from you. How can you design a payment scheme for the medical professional so that you actually get the ideal treatment?

“Over the last few weeks, I've been walking around and bugging people with this question to see what they come up with. Here I want to share some of the things I learned in the process with you, as well as some potential answers. I don't think the question (as presented) is completely well-formed, so the first step to answering it is clarifying the setup and deconfusing the terms. Also, as is typical with thought experiments, I do not have a definitive ‘solution’ and invite you (right now!) to try and come up with something yourself.”

Dig deeper

Fake news

(Via Reddit)

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And if you missed previous editions of this newsletter, they’re all archived here.

Warm regards,

Team Founding Fuel

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Founding Fuel

Founding Fuel aims to create the new playbook of entrepreneurship. Think of us as a hub for entrepreneurs- the go-to place for ideas, insights, practices and wisdom essential to build the enterprise of tomorrow. It is co-founded by veteran journalists Indrajit Gupta and Charles Assisi, along with CS Swaminathan, the former president of Pearson's online learning venture.

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