When Facebook sneezes, the media catch pneumonia. For some time now the ad-supported online media business has been driven by some simple principles: Advertisers love video; video is hot on Facebook; if you make lots of videos and put them on Facebook, you will make money. But what if this whole equation was based on bad numbers? That seems to be the case, based on the news that Facebook “vastly overestimated” average viewing time for video ads over the past two years (The Wall Street Journal). Naturally, ad buyers are upset, but the rest of us should be, too. Each distortion of the media economy under the influence of Facebook’s dominance means that much less diversity and risk in our informational ecosystem. It’s bad enough that Facebook twiddles the dials on the news feed at will; now we can’t trust its reporting of data. Facebook says the error was innocent, only discovered a month ago, and didn’t affect billing of advertisers. But those now-known-to-be-inflated viewing times certainly cemented Facebook video’s “this is the place to be” appeal. That it took the company two years to come clean only adds to Facebook’s credibility problem.
Yahoo finally tells the world about its gigantic data breach. Speaking of taking two years to come clean: Yahoo’s data breach turns out to be more recent than originally reported — it happened two years ago, in 2014. It’s also way larger than expected: 500 million accounts had their information compromised — that’s as in half a billion (The New York Times). The disclosure has left Yahoo buyer Verizon, which only learned of the data breach two days ago, examining its options. And it has left Yahoo’s customers staring glumly at all their other accounts and wondering what to do about changing their passwords. Yahoo is blaming a “state-sponsored actor” for the hack. (And no, that doesn’t mean an NEA-funded thespian.) Whoever is responsible, the gap between the event and its disclosure does not inspire confidence in the company, its leadership, or its industry.
Carbon accounting passes legal muster. If we’re going to fix the climate, we have to plug it into our numbers — the statistical models and accounting books that drive decision-making in business, government, and ultimately, our lives. The Obama administration has been trying to require its agencies to include the “social cost” of carbon in all their calculations, and opponents have pushed back in the courts. Those challenges got consolidated into one big appeal, and this week, a federal appeals court upheld the White House, maintaining the rules (Bloomberg). That’s good news as we try to imagine retooling the national and global economy so it doesn’t wreck the planet — by, for example, figuring out how to transform coal jobs into solar jobs (Grist). There’ll be plenty of argument about how to price each unit of climate havoc: for 2015, the feds calculate $36 for each ton of carbon emitted. Anything is better than pretending it costs nothing at all.
Old starts to become the new young. Graying boomers at the tail ends of their careers are facing discrimination, many for the first time (Washington Post). That means more bad blood in the inter-generational grudge match between millennials and their elders, and more lost opportunities for companies that snub veteran employees — and lose their expertise. If there’s an upside here, it’s that older workers may gain more empathy for the many other kinds of discrimination so many colleagues face, and embrace diversity wholeheartedly instead of resenting it, as some do. Even if your organization believes (as Mark Zuckerberg once said) that “young people are just smarter,” and isn’t deterred by the legal or moral case against ageism, it may have to get more comfortable with hiring olds: many countries’ workforces are graying rapidly (Bloomberg). When it comes to aging, no one’s exempt.
We set the rules of business’s game. We can change them. As new tech and new ideas restructure our economic world, Tim O’Reilly writes, we shouldn’t just sit back and assume that the “laws of economics” will assure an optimal outcome for all. For example: Uber has designed an amazing new transportation system around the needs of consumers, business, and investors — but by failing to take into account the needs of its drivers, it’s not only making their lives harder, it’s assuring backlash down the road. The Uber world needs, among other things, drivers who can deliver good rides, and it’s not going to get them unless it treats them fairly, as stakeholders. Systems that assume humans are expendable can’t succeed in the long run: that’s a “failed rule.”
Court to FCC: If states block public internet access, you can’t stop them. A federal appeals court has just made it a lot harder for cities trying to promote municipal broadband alternatives to the cable monopolies (Washington Post). The Federal Communications Commission has tried to give these public-sector options a chance, but many states have passed laws to hold them in check, and now the courts say the states, and not the FCC, should call the shots. The ruling is more about arcane principles of federalism than the practical needs of internet users. But that won’t help people still waiting for faster speeds and better service. The FCC can still appeal the decision (Ars Technica).
E-commerce turbo-boost. It’s official — the world’s largest retailer is going to buy e-commerce startup Jet.com for $3 billion (Recode). A move against the Amazon threat, as most media reports argue? Sure — but more importantly, a broader acknowledgment that even the biggest and most efficient company today can’t figure out the future by itself. It’s hard to look around corners when you own the whole street. Walmart rose to its retail dominance by inventing new distribution and pricing systems, but like most industry leaders, it came to face the innovator’s dilemma. Jet offers Walmart some novel algorithmic low-pricing techniques, as well as some startup-speed talent. But history suggests it might take more than an acquisition for Walmart to stay on top. Meanwhile, Jet’s team took only two years to grow to triple-unicorn value by reliably delivering low prices online. (The Walmart-Jet deal is exactly the kind of BigCo-NewCo cross-fertilization that the NewCo Shift Forum event next February is all about.)
Economy stuck in low-grow land. Forget market swings and mega-deals for a second and zoom out to fundamentals: What you see is a new economic normal of low inflation, low unemployment, low interest rates — and low growth. How’d that happen (New York Times)? The gap between long-term U.S. growth of 2 percent (the late 20th-century average) and the 1 percent typical since 2000 explains a lot of today’s news, including the stubborn persistence of inequality and the rise of populist anger. Is our economy “fundamentally broken”? Or did recent generations just experience a one-time boom, and then overestimate how cool new tech would keep it going? Of course, we could be measuring “growth” all wrong (see: GDP). Or we could be in for a rough century. No one’s suggesting a quick fix, but a big spend on infrastructure looks promising to leaders across the political spectrum.
Philanthropic lab funds individuals directly, empowering them to build a better Cincinnati
People’s Liberty will only last five years. After that, its ambitions — creating a stronger, better Cincinnati — will persist only through the actions of the 105 individuals it funded and mentored. It’s kind of an experiment, which is why the company brands itself as a philanthropic lab.
Supported by the Haile U.S. Bank Foundation, People’s Liberty conducts its experiments at the Globe Building, located in the Cincinnati neighborhood Over-the-Rhine. One of its four programs, Globe Grants, gives three people a year keys to its storefront to create an interactive art installation. Another program, Mad Philanthropists, invites nine people a year to join the team at People’s Liberty to work on projects with an eye toward building out their portfolios. The 16 people awarded Project Grants each year receive $10,000 to implement community development projects. Another program, the Haile Fellowship, is kind of a mini-MacArthur. The fellowship provides $100,000 to two individuals with a big idea that could positively affect the community. Brad Copper is working on tiny homes, which he hopes will address affordable housing in the Over-the-Rhine neighborhood. MUSICLi, an online library of music from the Greater Cincinnati, wants to help musicians earn more money via music licensing.
This seed-stage accelerator looks beyond product to help startups differentiate themselves
The Brandery, a seed-stage accelerator, is utilizing Cincinnati’s unique resources to help startups turn minimally viable products into sustainable businesses. What resources are those? Marketing and branding agencies have grown alongside Cincinnati-based Fortune 500 Companies like Procter & Gamble, Macy’s, and Kroger. As the barriers to entry for starting companies decrease, The Brandery believes startups focused on their brands can differentiate themselves and increase their probability of success.
The accelerator accepts 10 companies into its four-month program each year. In return for a 6 percent equity stake, startups receive $50,000, access to mentorship, pro-bono work from branding agencies, and a chance to work with companies like Procter and Gamble. Those resources have helped The Brandery become one of the top accelerators in the nation. The Seed Accelerator Rankings Project lists The Brandery at the Gold tier, just under Platinum where you’ll find 500 Startups and Y Combinator.
Active in 143 Countries, It’s Become the Largest Platform for Young People To Create Social Change
DoSomething.org wants to “make the world suck less.” To do so, it’s created a platform to encourage young people between the ages of 13 and 25 to engage in social action. “Young people want to make a change,” says Michaela Bethune, DoSomething’s head of campaigns. “They’re passionate. They’re frustrated.” DoSomething is tapping into that passion by spearheading campaigns that create change in the world. “Teens for Jeans,” a DoSomething project, collected as many jeans as there are homeless youth in the United States — five million pairs over eight years.
That level of impact is due in large part to the organization’s breadth. DoSomething has 5.3 million members spread across every U.S. zip code. It’s a spirited organization. The company puts transparency front and center on its site under its “Sexy Financials” page, which it uses to tell people what they’re “nailing” and what they’ve “F’d up.” Bethune, who we spoke to for our Spotlight, asked us to warn her if she swore too much. It’s endearing, and indicative of the nonprofit’s passion, which it hopes to continue spreading across the globe.
Culture defines a company — but it also limits it. That’s what Pip Jamieson discovered while working for MTV in Australia. “Everyone we hired were just mates and mates and mates,” Jamieson says. Hiring friends of friends was an easy way to find creative talent, but she felt hiring based on employee recommendations created a homogenous culture that lacked a fresh injection of ideas, skills, and talent.
To solve that problem, she founded The Dots, a UK-based online network where creative professionals can showcase their portfolios. Companies can find talent on the platform, and creatives can find job opportunities from companies like MTV, Spotify, and others. The platform is also building a community. Like LinkedIn, you can add people to your network and even recommend them. The site is also a resource, listing co-working spaces, courses, and networking events. “I really believe that creativity is a force for good,” Jamieson says. “Soon machines are going to drive, code, do our laundry … The last things humans are going to be good for is creativity. So, we help harness that community.”
It wasn’t until after they’d built their clean-burning stove that BioLite co-founders Jonathan Cedar and Alexander Drummond realized it was suited for something other than camping. Many people in India, Uganda, Kenya, and Ghana cook over an open flame. That’s toxic and inefficient. “Four million people are dying every year from smoke inside of their home,” says Cedar. “That should go to zero.” Cedar and Drummond built a stove that uses less than half the fuel and produces 90 percent less toxic emissions than a traditional open fire.
To get their stove to burn wood nearly as clean as gas, the flame needed more oxygen. They employed a thermoelectric generator to convert heat from the fire into electricity. That electricity powered a small fan that pulled in the extra oxygen. The fan didn’t require much power, so the team added an outlet for people to tap into the leftover electricity to charge cellphones or power lights. BioLite believes its stoves can help solve energy poverty. To do so at scale, BioLite employs what it calls parallel innovation. Its camping stoves, solar panels, lighting, and other products generate near-term revenue, which the company reinvests into its emerging markets business to ensure that, over time, it can self-sustain.