Black Swans
Hosted by Charles "Hipbone" Cameron (May 2007)
Nassim Nicholas Taleb just published The Black Swan: The Impact of the Highly Improbable. It is one of those books -- like Gladwell's Tipping Point or Surowiecki's The Wisdom of Crowds -- that adds a new and often counterintuitive idea into the general mind-soup.
In Taleb's case, the new and counterintuitive idea is that it's not what we know which might help us navigate the future, but what we don't.
To focus this approach on our concerns here as social entrepreneurs: one strong implication of the book is that the next extraordinarily successful venture – in our field as in the wider economic sphere – will be one that doesn't look all that obvious at first glance.
So how will we – as individuals, as funders, as a movement, recognize it?
Here's Taleb on entrepreneurship:
competitors, and the more successful the entrepreneur who implements the idea. The same applies to the shoe and book businesses or any kind of entrepreneurship.
Put like that, it seems fairly obvious – though it's not the way we usually look at things, not the way we "work".
I'd like to explore the implications of that paragraph with the social entrepreneurial community. I think there's a great conversation to be had here, because Taleb's pitch for the "idea not easily conceived of" needs to be balanced, or perhaps followed, by the idea of the "second-mover advantage".
The thing is, we know how to be second movers – all we have to do is watch and learn. But here are my questions:
• How do we recognize a positive black swan opportunity?
• How do we convey its benefit to others, since it's non-obvious by definition?
• How can venture and foundation folk nurture black swans?
• How can we ride them?
Join Charles "Hipbone" Cameron in the conversation.
Re: [Patrick] Sounds like The Blue Ocean Strategy
Hi Patrick
I very much agree, but I also think there's a really tricky high wire to be navigated, a balance to be reached. The problem is that second-movers do often have an edge. But if the swan-like first movers never get off the ground, there won't ever be a second mover!
See the two quotes I've juxtaposed at http://tinyurl.com/27rrzb .
Interdisciplinary
It seems like throughout time almost, all the greatest ideas have been through accident or unintended consequences. You name it--fire, x-rays, lightbulbs (I think I have my history right...) were all the act of right-place right-time scenarios. In this year's January TIME magazine, there was a short essay on how the lack of organization (on a desk let's say) can be a good thing as it fosters the once seemingly unassociable topics/ideas/products together that leads to the next best thing.
- I would say that the current "new markets" in academia come from the interdisciplanary studies-- bio+technology, astro+biology, quantum+computing. To recognize the "black swan" one needs to enable the seemingly disparate associations of "black" with "swan" to come together. This is where the venture and foundation folk can nuture these new markets
- by providing the necessary tools to create connections and networks where once they were not even thought to be (social+entrepreneurship anyone?) The benefit will be seen by the strengths each discipline/innovation lend to one another and the "whole greater than the sum of its parts" vibe the two will inherently supply (those that don't, shouldn't be in the first place). From there, it is the maintenance of those open connections along with the support of each discipline and the whole-strength they output that will enable the black swan to be ridden.
But I'm a Cognitive Science major, so I just love interlinking things in the first place ;-) (mmm..neurons...)
Notes
So after that mind-dump: 1-I'll revise my drafts next time...sorry for some English errors 2-The bold was unintended 3-Here's a SocialEdge article with Book link on the essay I was talking about (I bet it was a book review too) http://www.socialedge.org/discussions/business-building/play-around-procrastinate-make-a-mess/
Re [Evan] Notes
Thanks, Evan.
- As you'll see below, I run into the same problems with sudden bolding of parts of ym text. IMO we need the ability to edit our posts, at least for the first 30 mins after posting them
- that way, when weird typographic effects occur, we could see what the problemw as and fix it.
That used to be possible... perhaps it can be again?
Not Invented Here
Hi Charles and Patrick.
I attended a seminar last week where Bob Herbold, former Exec at Microsoft, told of how successful businesses fail, because they are Seduced by Success. The become smug. They stop innovating. They don't pay attention to competition and changing market factors. His book shows several examples.
I think this is relevant to this discussion because, unless investors, leaders, or anyone else who is needed to support an idea, learn to look beyond their comfort zone, or to build "what if" into their problem solving mentality, it will remain extremely difficult to recognize the black swan and nurture it to reality.
I feel like a Black Swan several times every day as I invite people to give consideration to the ideas I share via the Tutor/Mentor Connection. A few months ago I talked about creating a blog exchange, connecting people and ideas with each other. At http://tutormentor.blogspot.com/2007/05/volunteers-tutormentor-leaders-donors.html you can view some of the blogs that have contributed to this project so far. If either of you write blogs, I hope you'll write about this and add your weight to this blog exchange.
I've begun to create graphics to illustrate my ideas. At http://tutormentor.blogspot.com/2007/05/creating-networks-of-purpose.html you can see one that illustrates the key role of a network builder.
I encourage you to view this and write about it here, or in your own blogs.
Re: [Dan] Not Invented Here
You write,
:: I feel like a Black Swan several times every day.
That really hit me, Dan. I feel that way too, in fact I think it may be close to a job requirement for some sorts of intervention.
:: I think this is relevant to this discussion because, :: unless investors, leaders, or anyone else who is :: needed to support an idea, learn to look beyond :: their comfort zone, or to build "what if" into their :: problem solving mentality, it will remain extremely :: difficult to recognize the black swan and nurture it :: to reality.
- I couldn't agree more
- and one of the problems here is that it's fairly easy to set up an "outside my comfort zone" (or "out of the box") zone that is so timid, so close to the comfort zone (or box) that one can comfortably go "outside" -- and feel one has been creative, thought differently etc, just like Einstein -- without really gaining a new vantage point at all.
How can we create and schedule trainings for "black swan" and "visionary vision" recognition by those who could have the greatest impact if they "got" it?
How can we....
That is a "what if..." question. If I could post images here, I would, because they do more than words to create shared understanding. However, I can't, so I invite you to visit http://tutormentor.blogspot.com and in the tag section, click "map". You'll see several blogs that I've illustrated with graphics.
Each of them focused on the question of how we create and schedule training, by asking the question that should be asked prior to that, which is "how do we find the people who already have a self interest in what we're talking about, and how do we motivate them to go to spaces where they can learn about what we're talking about?"
Find people who are interested is not too difficult. Just search Google. To find people interested in topics related to tutor/mentor, search the links of the http://www.tutormentorconnection.org site. Every link is there because I feel it relates to the knowledge we need to know in order to be more effective at helping kids born in poverty be starting jobs/careers by age 25.
Getting the attention of these people is the challenge. I can email someone, which I do dozens of times a day, but most of these introductions are ignored. Spammers have added to this challenge by the way they clutter the Internet. However, I'm too small a fish to be attracting whales, or sharks. Until I get other people to issue the invitation, I'll not be getting the involvement of all of these people that I'm trying to connect.
The solution to this is just what we're doing now. We're networking. We're using someone else's space to draw attention to our ideas, and our web sites. I invited you and Patrick to talk about my blog on your blog because that's an active way to reach the people we're trying to reach. If others write about your blog on their blog, we create a chain reaction that can reach around the world. If we do this strategically four or more times a year, then we retain the involvement of some of these people, and add new people.
We already have forums for training "black swans" and as we reach more people, others will come forward with better learning technology, and facilitation skills, to help these people understand what the issues are, and what actions they can take to have a greater impact than they do right now, on issues that are important to them.
The key is that in this process we teach and motivate "what if..." habits, that are supported by time spent learning how other people in the world are already solving problems. This is the key to innovation. If we just sit here and talk about what we know, we'll be limited by what we know. If we point to libraries where what lots of other people know about a topic, then we expand the innovation base for all of us. If we look at this from a "what if..." mentality, such as "what if I tried this? Would it improve my own impact?"
If the question is yes, or even maybe, I think we've began to help the black swans.
Social networks
Getting the attention of these people is the challenge. I can email someone, which I do dozens of times a day, but most of these introductions are ignored. Spammers have added to this challenge by the way they clutter the Internet. However, I'm too small a fish to be attracting whales, or sharks. Until I get other people to issue the invitation, I'll not be getting the involvement of all of these people that I'm trying to connect.
Whales and sharks are out there whether you choose to see them or not, maybe they're also a food source. IBM is investigating the opportunities in social networks and micro-economics in Africa... this week. Who knows how long that will go on. It's a little frustrating to see the brain-storming beamers who would like to supply Africa with managers. But I did like the thought that they need a protected ID to do business, RFID to track resource, and social networks that lead to better communication among remote groups. My favorite was the sheer lack of knowledge we have about Africa, how little we know of each country, it's history, culture and current delima. I am concerned that people who best understand the sustainablity of an area have a big voice.
I don't have time to read "The Black Swan", but after I tried reading the fairy dust of 'The World is Flat'; I'm satistfied that picking up on generalities is often good enough to comment on generalities. I view the growth of civilization as a decision between dead children or orphans. Orphans are the product of war, and children die first in a famine. We need to take care that we are growing adults, learning their history, and understanding what is sustainable in their culture. Otherwise we are only growing child labor. There is no magic that will randomly fix a problem, only the reality that when you're not looking everyone dies. Something will replace devastation and we may call that success.
How do we understand sustainable growth, sustainable labor, sustainable skill and protecting divserse people? While we may not be able to protect the future, I believe we do have the tools to be better listeners and recognize when we are making progress or doing harm.
Re: [Dan] Not Invented Here
- I'm sorry
- once again, there are graphic effects in my post above that I didn't intend and don't have the ability to correct.
- The para punctuated by :: ever few words was meant to be indented I use :: as a marker for quotes the same way people in email often use > - but this software doesn't seem to recognize my line breaks, so I wind up with a para that no longer looks indented, but has these weird :: scattered through the text. And the bit where a line is in bold, followed by an indented para
- if I knew how to do that, it might be useful, but at the moment it always happens when i least want it to.
My apologies.
Re: [Dan] Not Invented Here
and it happened again...
Kiva: Spawn of a few Black Swans?
I look to kiva.org as an example of this... microlending had been around for a while, but the internet technologies (easy Web site construction, open source/free software, cell phones as internet access devices, and paypal) that made possible the micro-scale microlending that Kiva's facilitating were black swans, in that they made possible a reconceptualizing and reinvention of an existing market/service to create a potentially huge new social-entrepreneurship opportunity.
I suppose one way to generate these is: look for a technology that's already proven to be disruptive, and then look for things that it could distrupt. Then get out there and start the creative disruption. (Just don't cause too much pain in the meantime.)
Black Swan Dive
You might need to lend me a little slack on this one, since I haven't read the book. Still, I was drawn by all of your interesting contributions to the concept of black swan. Evan's interlinking principle led me to think of the all-new, uber-creative, black swan dive. The black swan dive is black, a hiccup amongst white plumage, it is swan, of grace and a long slender neck, and it is dive, as it manifests above water and sends ripples in all directions by its piercing entry.
Principally I want to ground this metaphor to the questions that this discussion has had in respect to investors, innovators, and associates of an idea. I intuitively believe the black swan dive takes place between air - the manifestation of an idea - and water - the collective consciousness of a marketplace. The surface of the water that swallows the swan does so in the same respect that common sense will swallow the once counterintuitive. All black swans are gracefully integrated into our intuition (the duh factor) but unanimously started off as nutty business plans.
Thus, the black swan dive (v. process of the nonsensical becoming common sense) is initiated by the innovator who either finds an investor as nutty as him/her or tricks the investor into investing in something else.
Speaking my language
As one working on a project i'm convinced is a Black Swan opportunity, it is interesting this is the first discussion i stumbled upon. I am going to go out on a limb and respond even though i have not yet read the book mentioned.
How do we recognize a positive black swan opportunity? My feeling is that you will sense it, even if you don't completely grasp what it is, you will feel the power/intensity of its potential. From a more logic perspective, with inquiry and exploration the benefits will not be difficult to see and it will stand out because it will present an opportunity to do what has not been done with what already exist (at least to start).
How do we convey its benefit to others, since it's non-obvious by definition?
The enterprise will be based on previous work and is distinguished by how it proposes to advance that body of knowledge. For example, my work has grown from my research into community mental health and then expressive therapy and then inclusive economic development. I didn't invent them and their benefits have been well documented. However, what i have done is combine them in a way that is unique because i am operating with an artistic framework to create solutions that work for responsible innovative businesses, ecosystems, individuals and communities.
Although i have not mastered this what i am learning is that conveying the benefits begins with understanding which benefits are of interest to the person being addressed....and hopefully that will be someone as interested in the social implications as the commercial potential.
How can venture and foundation folk nurture black swans?
Keep in mind that my comments are not about self promotion but part of my genuine quest to take my project to the next level and advance my own understanding of how to do this. One goal of my work is to create the infrastructure to support other social enterprises that leverage the value of the humanities and the talent of individuals to effect positive changes. That said....
What is needed is support for research such as mine to develop case studies and models for new interdisciplinary approaches. One of the challenges of doing something first, is that in the beginning most said it can't be done by the person who set out to do it, and then because the vision is too big...but what is the payoff in playing small by limiting our vision? As i have persisted in my undertaking a growing group of supporters has joined me and helped to advance Cultural Fusion, but what we have not been able to attract yet are sponsors or funding. (And yes, we have been doing grant proposals for over a year now)
Who do folks like me go to with projects that are bit more complex and long term than doing a simple human services program? Unlike most projects i have consulted on, this one addresses an approach to sustainability that not only stands to benefit my project but many many community projects.
How can we ride them?
First, understand what it means to do something new...to be the first. It comes with great risk and even greater opportunities. Instead of closing doors and saying no, let's explore how to minimize risks and become part of developing new models...let's expand the world's vision of what is possible. Select the ones that nurture sustainable growth and address a need you have or are concerned with addressing. Pay attention to projects that are inclusive and invite increased participation on mutually agreed upon terms.
I offer as an example my project.... Cultural Fusion operates on many levels although it is first and foremost part of an art series and art movement, "art as philosophy". Next it is a CRM (customer relationship management) strategy for businesses and NPOs, social enterprise, and community renewal solution. I am combining FOSS, ICT (information communication technology), new media, digital art, painting, prints, publication, performance, installation art, music, CRM strategy and meaningful marketing principles, community mental health -expressive therapy, community renewal, economic development including permaculture and sustainable agribusiness, biology, Attention and Love(Passion) using a framework i call "SoulFood Tradition" to invite others to help me explore art with purpose through a series of interactive art projects. My interest in quantum computing also played a major role in developing this work and my intention is that it will lead me back to that line of inquiry with more insights to advance those ideas as well.
If anyone has suggestions or comments please feel free to contact me.
the non-obvious
That old rascal Mao Tse Tung once said, "In every political situation there is one and only one principal contradiction. All other contradictions are secondary and derived from the principal contradiction."
I think finding the non-obvious in any social situation is the result of a certain kind of social contemplation that qietly reviews all the parameters, without any economic agenda, merely a restless curiosity.
Many of the problems taken on by social entrepreneurs are directly derived from the socioeconomic status structure of society and the focus of attention is on the poorest. What about looking at the beliefs and values of elites and the middle classes that keep the poor in place? See life steadily; see it whole. Maybe creativity can unleash much larger social forces than the few paltry millions of the social entrepreneurs.








Sounds like The Blue Ocean Strategy
Good find Charles. The Blue Ocean Strategy I reviewed last year says about the same thing - look for a new way to create a new market and you will have it to yourself. The question is, how many of us are crative enough and courageous enough to do that. Oddly,(and in keeping with the thesis of the book) the first movers are often the most unobvios people we know nothing about - Ted Turner in the 70's, the pair that crated YouTube, etc. There is no predicting creativity!