Letâs talk unicorns. No, not the mythical horse-like creature with one horn that was used as a symbol for Jesus Christ in medieval times, and depending on who you ask, poops rainbows (thanks, Squatty Potty). The unicorns Iâm referring to are those privately owned startups valued at a billion dollars or more that are currently taking over the world. As recently as 2015 there were only eighty-two such companies; as of 2018 there were more than 295.1 Fast forward just a year, and by April of 2019 there were 326, with a collective worth of almost $1.1 trillion.2 Many of those were household names, such as 23andMe, Stripe, and SpaceX, along with Uber and Pinterest, which have since gone public. Others you may never have heard of, like the real estate broker Lianjia, the Bitcoin mining application company Bitmain Technologies, or the ByteDance Internet and AI technology company, all three of which happen to be Chinese firms.3
Unicorns are here because of the Fourth Industrial Revolution, which is transforming the way we live, work, and learn, unlike any changes seen before. As a modern society, weâve come a long way since Britainâs technological advancements in the mid-eighteenth century that led to the First Industrial Revolution, a time that may seem very quaint in comparison to today. Within a hundred years, the world would experience the start of the Second Industrial Revolution, the birth of the assembly line and mass production, not to mention the widespread use of electricity. The Third Industrial Revolution, which seems like just yesterday to many, was another leap forward, with digital manufacturing, automated production, and global Internet connectivity. Organizations had to keep up with technological progress to stay relevant. Those who particularly understood the changes around them were able to shape the world that we live in today.
We have now entered the Fourth Industrial Revolution and are experiencing change at an unprecedented pace, level, and intensity. From augmented reality to genomics, our society is becoming infused with new technologies embedded not just within our homes and workplaces, but even our bodies. We are rapidly blurring the physical and the digital, transforming the way we live and, in some sense, what it even means to be human. This transformation is just in its infancy, as business models will continue to be disrupted and access to technology will increase, along with the ability to develop, launch, and scale new products and services in an ever-shorter time span.
From the cotton spun by the British in the 1760s to the digitization of the twenty-first century, continuous innovation has been necessary for the unicorns of their day to emerge, spearhead change, and prosper. As human societies move forward, so do their businesses. Change always creates opportunities. Thereâs no telling exactly where this hyper speed of exponential change will lead us, but if we donât act now, weâll miss out on the greatest opportunities of our lifetime.
Innovation is urgent, time sensitive, and always present. Itâs how weâve adapted to change and succeeded over the past two and a half centuries, and long before. As with every era behind us, there are new business, social, and economic issues that must be tackled in the Fourth Industrial Revolution, and just as the challenges and opportunities of the past had to be met, so do those of today. If you want your organization to survive, remain competitive, and prosper, then you canât wait to start taking action. Otherwise, youâll be forgotten, passed up by the next in line, or blindsided by disruption, because todayâs unicorns could be gone tomorrow. In short, innovation never sleeps, and we canât sleep on it.
Still, despite the obvious need, many organizations lack a clear focus when it comes to innovation or fail to align their efforts with market realities. They âkind ofâ know that they âmust innovate,â yet they are not sure âwhereâ and âwhy.â Sadly, leadership is missing the big picture as well; most executives donât even know where their innovation priorities should lie, and by some accounts only 14 percent of executives feel âhighly confidentâ that their organizations are prepared for the changes taking place in the Fourth Industrial Revolution.4 Many of us simply donât know what to do.
So where do we begin?
Donât Join the Dying Breeds
Youâre probably thinking that, as a rule, âdonât join the dying breedsâ is pretty much self-evident. Who would want to be a casualty of the Fourth Industrial Revolution, and wouldnât most leaders do all they could to avoid such a fate? Itâs a good point, but the truth is it doesnât always play out that way in reality, no matter our best intentions. Let me give you a simple example: We all know that exercise is key to living longerâno one would deny that. Yet the US weight-loss industry is currently valued at $72 billion and growing.5 If we actually followed the advice of our doctors and exercised diligently, we wouldnât be spending so much on meal replacement programs, pills, and the latest, greatest diets. The US is one of the most educated nations on earth,6 but this hasnât protected it from an obesity epidemic.7 Despite knowledge about the benefits of exercise, and an overall desire to live longer, nearly 40 percent of Americans are obese.8 Even though we know better, we canât seem to help ourselves; many companies that have receded into oblivion are no different. Maybe they made the effort, maybe they didnât, but one thing is for sureâthey have gone extinct, some along with their entire industries, even when they, too, âknew better.â
The ever-growing list of recent former industry pioneers that have quickly disappeared in this new era is well-known and well-trodden: AOL, BlackBerry, Kodak, Myspace, Motorola, Nokia, Polaroid, Sears, Toys âRâ Us, Xerox, Blockbusterâit continues on and on. You can still visit the last remaining Blockbuster in the world, in Bend, Oregon, which has become a popular tourist attraction, but thatâs it for what was once the worldâs largest video rental chain.9 This fate could have been avoided had the companyâs focus been on innovation, allowing leaders to see what was happening right in front of them and what was to come. In 2008, Jim Keyes, the CEO of Blockbuster at the time, told the Motley Fool, âNeither RedBox nor Netflix are even on the radar screen in terms of competition.â10 Of course, Keyes is not alone.
Many years ago, a recruiter asked me to consider interviewing for a small Palo Alto startup called Facebook. I laughed it off. The concept of social media already existed, and Myspaceâa popular social media network at the time that once surpassed Google as the most visited website in the United Statesâseemed to be doing incredibly well and meeting all its customersâ needs. Frigginâ Myspace! When the platform ended up losing most, if not all, of the music that its users uploaded in the twelve years between 2003 and 2015 (which amounted to 53 million songs from 14.2 million artists), it was almost like nothing happened.11 That was because by 2015, Myspace had fallen so far into obscurity, no one seemed to notice the loss of so much un-backed-up dataâthis was the company that I thought would make startups like Facebook completely hopeless.
Shortsightedness stifles our ability to stay relevant and contributes to a mindset that lulls us into believing that as long as everything is generally fine now, itâll be fine in the near, or distant, ...
