2468 FBF: Kevin Maney - Newsweek, Play Bigger, How Pirates, Dreamers, and Innovators Create and Dominate Markets

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Welcome real estate investors and financially aware people from around the world. This is your host, Jason Hartman. And this is episode number 689, 689 on that slide toward episode number And of course, we have way more episodes than this if you're listening to the other podcasts, the Longevity and Biohacking Show, the Holistic Survival Show, the Jetsetter Travel Show, any of our other shows. We have so many, I can't even mention them to you, but over 3,000 episodes out there. So be sure to take advantage of those and check them all out. Why should you be listening to anyone else or anything else? We've got all the content you need right here. Check out hartmanmedia.com for all of those shows, or just type Jason Hartman in your favorite podcast platform and you'll see them. Today, our guest will be Kevin Maney. He is a columnist for Newsweek. He's the author of Play Bigger: How Pirates, Dreamers, and Innovators Create and Dominate Markets. And you know, this is interesting because we've talked many times over the years, over the many years we've been together here on the show. We've talked many times about the concentration of wealth, the diminishing middle class, how the rich are getting richer, and the scalability of certain types of businesses nowadays. This is good and bad, like so many things in life, and it can be problematic. And there are many stories nowadays. One I, I just want to share with you here in a moment about Rent inflation and how the standard of living for many, very unfortunately, is declining. Mostly in the U.S., I think that is the case more so than in other countries because other countries, they're in such bad shape. So many of them, not all of them obviously, but many of them, they're in such bad shape that people are rising up into the middle classes. You take China, you take India, you take many other countries like those around the world, and For many people, there's nowhere to go but up, thankfully. I mean, my God, it's, you know, they've had a rough time of it for virtually for their entire history. Many countries really missed the Industrial Revolution, and many are missing now the Information Revolution. And, you know, I've asked myself after reading this fantastic book many, many years ago by Alvin Toffler, who I would love to get on the show, You know I am a big fan of futurists, and I love to try and figure out where we are going. What is the future? What does the future hold? For many years, I was a member of the World Future Society. I'm constantly reading up on futurists and trying to understand what they're predicting. And this fantastic book by Alvin Toffler years ago called Power Shift talked about the 3 forms of power. The first, most basic form was the ability to inflict violence, the ability to inflict harm on another. As crude and evil and awful as that sounds, we see people still, many religious radicals, we see them still playing by that level of power. Right? Let's hurt our fellow human. Let's, let's take a bomb. Yeah, you don't need a gun, folks. You don't need a gun. Get a frickin clue. You do not need a gun. There are an endless number of ways to harm people, and you can do many of them without guns. In fact, in Europe, where they've got very strict gun laws, obviously, there are many stories of stabbings. And you don't see a lot of these reported in the Lamestream media, or the mainstream media as it's known. I call it the lamestream media. They're just not reported because of political correctness. But yeah, there's many ways to harm our fellow humans, which is just unfortunate. So that was really the first form of power that Alvin Toffler talked about in Power Shift, the ability to inflict violence. And that's a really low-grade form of power. The next form, and this became particularly big as we approached the Industrial Revolution and throughout the Industrial Revolution, is still valid today of course, but not as powerful as it once was. And that is the power of capital, the power of money. With money you can throw your weight around, so to speak. You can exert power by paying people, by buying them off. Heck, you can buy off judges, you can buy off, uh, politicians. Obviously that's no surprise to any of us. Look at the Obama administration, how corrupt they are, right? And really, you could look back at the Bush administration, I'm sure you could say the same thing. I just don't happen to have any great examples of it. You know, Bush, as much as Bush was hated He really didn't have a bunch of scandals. Clinton had tons of scandals, and those Clintons, they're just— I mean, Hillary Clinton, the criminal otherwise known as Hillary Clinton, my God. No matter what side of the political aisle you're on, you just have to admit Hillary has a huge problem with the truth. She has like no relationship with the truth. Hillary, right? It's mind-boggling. But you look at, you know, here Obama, the fan of the little guy, right? He, of course, you know, Michelle is talking about how we gotta have better food and so forth, and that was one of her big missions as First Lady. But yet, what is it? The head of the Obama administration's Agriculture Department was the former head of Monsanto. Now Monsanto, by any standards, Right. Is, you know, any objective standards, is, is not a good company that does not really want to do good things for the food supply with their genetic engineering of seeds and bullying farmers out of business with capital, the ability to throw around capital and to hire lawyers and lobbyists and PR firms and other various scumbags. To exert their power. And, and, you know, I'm, I'm referring to Roundup, I'm referring to GMO. And this is not the GMO your father and grandfather knew about. This is a new kind of GMO, okay, that is, uh, that is scary, but it's yet unproven as to what the real effects are. I've done many shows on it on my Holistic Survival Show, and some of those, I think, uh, on the Longevity Show possibly As well. Welcome to this week's edition of Flashback Friday, your opportunity to get some good review by listening to episodes from the past that Jason has handpicked to help you today in the present and propel you into the future.

Enjoy.

And so, you know, that's just a big question mark. Honestly, to be fair, we don't know. I think that's where I come down on the GMO thing, but it's certainly pretty scary, the Frankenfood stuff, to be sure. So the ability to use capital for power, that was the second form of power, higher grade than violence. Now the third form and the highest form, and still today the highest form, and this makes me wonder what is next? As a futurist myself and a hack economist, well, I'll give myself the moniker economist, But you may say hack economist, fine, whatever. I'm always trying to figure out what's next, and it is not easy. So if information is the highest grade form of power, which I believe that is true, as Alvin Toffler postulated, what is after information? See, with violence, you eventually destroy the thing you're trying to control, so that doesn't work very well. We've all seen these— Disgusting, slow, torturous deaths to get information out of people. We've all heard about this stuff, right? And, you know, it's been featured in many movies and such. And then with capital, even the, even the thickest, fattest wallet runs out of money at some point. Or by giving all that money to the party or entity we're trying to control or exert control over, we eventually make it lose its significance because at some point everybody just kind of has enough money and it's like they don't care as much about money, right? When you have a certain amount. And then there's information. Now that same piece of information can be used by multiple parties at the same time. And if you take information from me and you use it, it doesn't lessen my ability to use it.

No.

Not necessarily. It could if it's a secret, and say it was a real estate deal, for example, and you overheard me talking about a real estate deal. I was maybe in a restaurant at the next table from you, and you are a real estate investor, and you jumped on that deal and snagged it out from under me. Well, there, you know, information has value only to one party. But many times information creates more information and more knowledge, and it raises the entire tide. You know, a rising tide raises all the boats, raises all the ships, right? So interesting stuff here about the various forms of power. But what do you think is the next higher-grade form of power? Any thoughts on that? I'd love to hear from you. Send me a Voxer, jhart88 on Voxer. Love to hear from you. Maybe we'll feature it on the show. I know, folks, a lot of those Voxer messages you've sent me I haven't gotten around to featuring. You know, we'll get around to it at some point. I got a nice review the other day. Thank you so much. This is by B. Spear from somewhere in the United States of America. Jason is a game changer, period. Spelled out period and then a period after the period word. And this was on iTunes. After listening To years of Jason's shows, inflation-induced debt destruction has become part of my vocabulary. This raving 5-star review is clearly overdue. I sincerely appreciate your weekly insight. Weekly? Well, apparently you must be missing some of the episodes, Mr. or Mrs. Spear, because we publish 3 times a week, every Monday, Wednesday, and Friday. So hopefully You'll like me 3 times as much now because you've got all those extra episodes. Folks, be sure you're subscribing to the podcast because if you're not an actual subscriber, you're missing episodes. So click that subscribe button, make it official. It's free, so the price is right. You know, we're not trying to take any of your capital, right? So make sure you're a subscriber. I sincerely appreciate your 3 times a week insight. I'm just going to correct that for you, Jason. And I have implemented much of your investing philosophy in creating my own wealth. Thank you for the help. Hey, thank you for the review. I very much appreciate that. We so much appreciate your reviews, folks. So please go to whatever podcast platform you're using and write us a review. It'll just take you a moment. We really, really would appreciate it. So talking about the Standard of living issue. Now, over the years, I have been asked this issue so many times about rent inflation. Okay, so let's just talk about this for a moment before we get to our guest. Here's the deal. Look at this like 2 ladders, if you will. It's the best way I can think of to illustrate this. Okay, there's 2 ladders side by side, and they're leaning against a wall. Right? And so these 2 ladders represent the socioeconomic ladder. How much money, how much wealth does a party have, right? And on one part of it, you see a certain house, right? And we'll call this house, we'll say this house is a 1,500-square-foot rental house. Actually, that's pretty nice. Yeah. We'll go with 1,500. It's a round number. Okay. Well, it's not really a round number technically. By the way, I've been geeking out on some great documentaries. Tangent alert again, but some great documentaries on Netflix you gotta watch. This one on algorithms was awesome. The one on maths, math with an S, that was like a four-part documentary series. That was phenomenal. You know, if someone had shown me that documentary in 7th grade, I would have been so much more interested in algebra and trigonometry and geometry and all of that stuff. It just wasn't that interesting to me because I didn't think it really applied to my life. But when you see the history of math and how it changed the world, I mean, it was fascinating. I mean, I remember studying Euclid and stuff stuff like that, but not like this. That documentary just make it came come alive. If you have kids who are you know school age kids like junior high, high school kids, have them watch that. It's fantastic documentary series. Really good maths. Math with an S. It sounds weird. It's hard to say. Yesterday I was watching this other fantastic one. It's called How We Got to Now. How We Got to Now. And you know it's PBS, so it's got the left. Spin, of course, like all that PBS stuff does. They certainly do some good stuff, right? I just think they shouldn't be funded by the taxpayers. That's all. I mean, look, you can't hear the dogs that don't bark. If PBS was not there, if NPR wasn't there, the market would expand to fill the void. And all of that great programming, probably a lot less biased, than PBS and NPR, okay, would be provided by the marketplace, by the free market. Look at— if something— if the free market won't support something, it pretty much probably shouldn't exist unless it's infrastructure. Now, the free market won't necessarily support a lot of the infrastructure stuff that governments provide. And hey, that's why we need government, right? I'll have some government. It's okay. I don't dislike it I just think it's way too large. Okay, where were we? Rent inflation, 2 ladders side by side. We got the 1,500 square foot rental house— we're off the tangent, just in case you didn't notice. So we've got the 1,500 square foot rental house that represents a rung on the ladder, and say that rung is in the middle of the ladder, right? And now we've got the tenant who is renting that house. And let's say that house, the value of it is $120,000 and they're paying $1,200 a month. This sounds like pretty much any property you can find at jasonhartman.com. There's a commercial. jasonhartman.com/properties. You go there, you can find lots of properties like this. Well, not as many as you used to find because inventory is very low, but we've got some of them, I'm sure. So check it out. Jason Hartman dot com. Boy, you shameless self-promoter, you!

Ha!

Tell ya. Okay. Anyway, one rung on the ladder is that 1,500 square foot, $1,200 a month house, and there's a certain tenant profile, an avatar of a tenant that rents that house today. And as rent inflation occurs and pay does not keep up with rent inflation because rent inflation has been very significant. Significant over the past few years, as, mind you, I predicted it would be, and I am still predicting it will continue to be for over the next 10 years. Now, there may be little spots in there where it doesn't happen much, but the demographics coming at the next 10 years of rental housing are nothing short of phenomenal. Okay? So that said, we've talked about Gen Y. Now we got to start talking about Generation Z soon, folks. So if you're bored with my talk of Gen Y, hold on to your hats. Does anybody wear hats anymore? You know, those fedoras are kind of coming back in style. I think I got to get one of those. It'll hide my receding hairline. Obama told me there wasn't a recession, but then I look in the mirror and I swear to you, there is a recession going on.

Okay, tangent.

See what happens when a podcast host who's actually not funny at all attempts humor. Oh, it's dangerous. It's a catastrophe. Yeah. Anyway, moving on here. So you got that avatar tenant, 1,500 square foot, $1,200 a month house. And as things change, say the picture, the financial picture gets worse for them. You talk to them 5 years from now. They haven't been smart about their life, or they've just been a victim of circumstance. As inflation that's baked into the cake, probably we don't know for sure. It sets in, or robotics take over the workforce. They become unemployed. Whatever happens is going to happen. We've got all of these trends going on at the same time. It's obviously very difficult to predict. So that happens, then that person still. People rent something, but they move down the ladder. Well, actually, maybe the better way to put it is the ladder moves on them. So you talk to them 5 years from now and they're still renting, and they say to you, you know, we used to rent a 1,500-square-foot house in a nice neighborhood in a better school district, and now we live in a 1,000-square-foot house and it's not as nice a neighborhood. And the school district's not as good, but it costs us the same percentage of our income that we used to have to spend before for our housing needs. And that's what happens. It's not that people don't rent anything. It's that they just simply get less for their money. And this, my friends, is what we call inflation. But nobody really understands it or notices it properly. They just kind of wonder. They think back and think about how their life used to be, and they look at how it is today and they think, wow, what happened? Well, I guess maybe they should have been paying attention. They should have figured out ways. They should have listened to the show and figured out ways to beat these economic maladies, right? Stagflation, inflation, deflation. Those are the 3 basics. They will continue to impact everybody in the population. And you see how unfair, really, this time in history is. With this very low interest rate environment, it helps the rich get richer, and what ultimately happens is the poor get poorer. And that is happening. So, you know, we started off with this conversation about the concentration of wealth, and then you look at people out there like Bernie Sanders, and, you know, you hear his His rhetoric and, and, you know, he's, he's not wrong. His solution is just wrong. His solution won't work in a million years. He lives in fantasy land. But he does identify the problems pretty well. And Bernie, I thank you for that because it's good that people are paying attention to these problems. The way you suggest we solve them is frankly childish. Bernie, You live in fantasy land. Hillary, you're a criminal. Trump, you're strange. I mean, who do we get to vote for? Well, we had a couple libertarian candidates on the show. We had Austin Peterson on the show. Who else did we have? We've had a whole bunch of presidential candidates on the show, haven't we? Gary Johnson was on the show, another libertarian candidate. Of course, we had Ben Carson before. So anyway, that's the The size of it. Look at— I am rambling again. I think we better just get on with our guest here, Kevin Maney. Visit JasonHartman.com, check out the properties, the products. We don't have any events coming up right now. Of course, HartmanEducation.com for some of our fantastic new educational programs. We've built a whole online learning portal for you there. Be sure you check out HartmanEducation.com. I think you'll really like it. There's some free videos there as well. Just make sure you check that out. Okay, so let's get to our guest. It's my pleasure to welcome Kevin Maney to the show. He is Newsweek's tech columnist, author of the new book Play Bigger: How Pirates, Dreamers, and Innovators Create and Dominate Markets. He's also author of the best-selling books Making the World Work Better: The Ideas That Shaped a Century and a Company, referring to IBM, and And co-author of The 2-Second Advantage: How We Succeed by Anticipating the Future Just Enough. Kevin, welcome. How are you?

I'm good, Jason. Thanks.

Good. It's good to have you on the show. So as we look around the landscape nowadays, so many people are, are talking about tech companies and these miraculous changes and how they're improving quality of life massively, these high valuations. You profile a lot of this stuff in Play Bigger, and investors certainly have to be concerned about it, but it's just interesting in general for all of society. Give us an overview of what's going on out there.

Sure. Well, the book that we did is essentially a study of what we call category kings. Category kings are these companies that create and define and then dominate something that's just an entirely new category of business. And you see them all the time. I mean, you could— you think— I mean, Uber is a good example of that. Uber is a company that— before Uber, this thing that Uber does just didn't exist. We just stood out by the side of the road and waved our hand in the air and hoped a taxi would come by. Um, and, and so it created something entirely new and, and really gave definition to it, and then, and then has really dominated that space. Um, Amazon did that when it launched its bookstore ages ago. Xerox did that when it created the copier. And these companies are the special companies that tend to really change our lives and have an enduring business over time. And that's an interesting lens to start looking at things in this moment of time when we've had— there was a big focus in technology in 2015 on these so-called unicorns, all these companies that got to a billion-dollar valuation, many of which seemed to be doing really stupid stuff or were the third company to do something in a particular space. And it was just runaway investment money. And people were right to start to get concerned because if you have a high valuation of a company that is not going to be a category king, it's a really bad investment. And that company is going to go— kersploot at some point in time. But if you have a high valuation of a company that is going to be a category king over a long period of time, whatever that valuation is today, I guarantee you that it's a bargain. Because these are the companies that are going to be around in 10 or 20 years and really change the way we do things. So, we use data to sort out what a category king looks like, who they are, start to define them. And then we studied their particular traits to try to say, you know, what does a category king look like? And more importantly, if you're an entrepreneur starting a company, how do you become one? Um, and so that's, that's essentially what the book is about. And it's— we think it's really important in this particular point in time when there's, you know, so much sort of hype around technology.

Well, okay, so tell us who, who those category kings are nowadays.

Certainly, one of the criteria is that it's creating something that just didn't exist before. But then there's also another thing that tends to happen is that these companies don't just build a product and just hope that we all find it. This sort of old thought in technology about just if you build it, they will come really doesn't work. And so, these really great category kings set out on a mission to essentially change the way we think, change the way we perceive the world and how we do things. And the company that does that in a particular space tends to take 75%, 80% of the economics of that particular space over time and leaves everybody else in the dust. So, you know, companies that are popping up, you know, these days, um, you know, if you look at something like a GoPro, for instance, I mean, GoPro created something, these video cameras for, you know, this, you know, sort of active type of person. It just didn't exist before. And they defined it in a way that we understood what this product was supposed to be, how it was supposed to fit into our lives.

Right.

And in a way that by now, we essentially associate that kind of thing with that company and we don't think of anybody else. If you think of that kind of, I want a camera that I can strap to my head while I go surfing, you're not thinking of a Sony product or—

Yeah. Well, it's the generic, right? It's calling it a Kleenex, a Coke, that kind of thing, right? the point it gets to Googling something. Unfortunately, as much as I sort of love to hate Google because I'm concerned about the invasion of privacy and so forth, but that's, that's when it becomes just a generic term, right?

Well, I mean, it's more than that though. It's, um, it, it actually just— it, you know, this, this essentially the space becomes the company and the company becomes the space. And, um, and so if you look at like today, like, you know, A hot new company is Slack. And I don't know if you use that, Jason, in your work.

I don't use it, but a lot of my friends do and they love it.

And this again, this is a company that right now is doing exactly that. It's created something that we didn't have before and has completely associated its company name with that thing, that sort of online collaboration thing. And nobody else is going to be able to break that. It's just the way it works. And, you know, once a category gets established, it's almost impossible to change people's minds and make them believe that something else is better than that.

OK. Well, what else should we know? I mean, when people talk about unicorns, I mean, is that a valid interpretation or not? And maybe explain what is a unicorn?

Well, OK. So there's been a fascination with So, unicorn is a private company that gets valued by private investors at more than $1 billion. And by the way, go back 10 years, and we didn't even have any visibility into the value of private companies. I mean, this is fairly new because of data and databases that have been created by a handful of different entities. But in the past couple of years, so much money has flowed into venture capital. A lot of stupid money has flowed into venture capital. And so, there's been a whole— they're called unicorns because it used to be really rare to see a technology company surface that actually had a billion-dollar valuation while it was still private before it went public. And suddenly, in 2015, there was an explosion of them. There was 100 20-something or more unicorns that popped up. And so, it got people saying that there's a bubble going on, and this was just all going to collapse, and all these unicorns were going to get crushed and go away, which is the wrong perspective. First of all, pointing out a company as being a hit because it's got a particular number attached to it is a very narrow way of thinking about what companies are good or what companies are bad. So, a better lens is essentially saying, is this the first company into a space? Is it really defining that space? And is it really changing the way we think about the way we do things in our life? And if it is, It's a potential category king. It's a company you want to be involved with. And whether you're looking for a place to work or whether you're looking for a place to invest and wait for that IPO to come out— and if it's not, it's probably not going to be a valid company for very long. Maybe it'll sell the technology to Google or Facebook or somebody like that and make some money, and the founders will go off and party on a boat for 3 years or something. But it's not going to be a lasting company. One of the things that we also say about these category kings, there's 3 aspects of building a company that we are saying are critical. 2 of them have been around for a while and pretty well recognized. When a company first is born, it's usually focusing on product design. It's usually born because somebody understands that there's a product that they want to build and so they focus on just building that product, probably a few guys in somebody's basement or something. Then companies tend to move towards— they get a product and they start to create a company around it. So then they're really kind of thinking about what we would call company design and that is like what kind of company we're going to make, what kind of people we're going to hire, what's the culture going to be like. And most entrepreneurs get that far and essentially stop. And one of the things we discovered about these category kings is they take one more step and they also look at what is the space, what is the market we're going to be going into, and how do we actually design that? How do we actually convince people to think differently? How do we actually create an ecosystem around our company that helps developers and fans and people who are going to help us to sell this company? And we call this category design. We call it designing the space around the company. And the great category kings, over and over again, we've seen design the product, the company, and the category Relatively at the same time, they do all of these things, and that's what actually gets them over the hump to be able to be an enduring, lasting kind of entity.

Can you give us an example of that? I mean, designing the category, I think Uber and Airbnb would be great examples of that, right? We really should mention Lyft. I think it's unfair. Uber is sort of a bully company. As much as I love that they opened up a new category and use them all the time, I don't know. They throw their weight around an awful lot. I try to support their competitor too, Lyft, L-Y-F-T.

No, actually, let's talk about Uber in that context because you raise a really—

I don't mind that they're doing it against the taxi companies, but I think that they do it in a lot of other ways that aren't so—

No, Jason, actually, you raise a really interesting point about Uber, which fits exactly into what we're talking about here. Uber came along and these 2 guys saw a particular possibility of a product to design. So, they started with product design. They did this. And they created this company with a certain attitude, which you just started to describe a little bit, which has often been pretty much of a bully kind of attitude. Okay. So, they designed this company and then they did a really great job.

Yeah.

They did a really great job of defining this space, designing the category, making us understand what Uber was supposed to be about, how to use it, and now it's become something we all are familiar with and we know. So they actually built—

So go into my grievances with Uber though.

Yeah, no. So here's what I would say about— so as I said, the great enduring category kings Design a great product, design a great company, and design a great category. All 3 of those things. What we would say about Uber is that it has a problem with company design. It designed a great product. It designed a great category. But the company design seems to be faulty because drivers are not— liking working for Uber. You know, people like you are, as a customer, are feeling this sense about Uber. And if you don't have all of those 3 pieces, if all those 3 pieces aren't excellent and working together, the company eventually is going to fail in some way. And if Uber doesn't fix its company design, it's going to have a serious problem.

Interesting. Fair. I think too. I will just— I'll make a crazy prediction on this show. I have no evidence. I just want to tell everybody I have no evidence here, just a lot of hearsay, but I hear it all the time. I just think there will someday, and maybe there's one going on already that I don't know about, be some big class action lawsuit against Uber over the surge pricing issue, which in concept I completely agree with. Okay, I think it's a great idea. To have surge pricing. But every driver, driver I talk to says that they go to the surge area and it disappears. But yet every customer I talk to says they're paying surge pricing all the time. And I just, I just have this eerie feeling— I could be totally wrong, I apologize Uber if I am, I mean I love you in a lot of ways, but I don't know, you know, I got some issues too— that they're charging the customers the surge and not giving it to the drivers. I don't know.

Well, I mean, you might be right. And again, this is a company design problem, um, and, uh, and, and it, it can, it can turn into a problem for, um, you know, for a potential category king if that doesn't work. Look, you know, you know, since we're talking about investments, uh, let me, um, add something else here. So, um, one of the things that we discovered as we went through all this data about Category kings is that— now, one, the job of a category king, or a category king that does this job well, essentially, as I said, was changes our mind, changes our brains, the way we, you know, we, we think about how we do things. Um, and we also, we also— so we kind of realized that this is what the great category kings were doing. And then looking at the data, and we also found that, um, that almost all of the— and this actually does go back to Uber for a second— for, um, almost all of the great category kings, um, go public, they have their IPO somewhere between being 6 years old and 10 years old. And if you— the companies that go public before 6 years old tend to often have falling values over time. Companies that go public after 10 years old tend to just stagnate for a long time in total value of the company. We're starting to try to match this up, like ask, why is this? And what else does it match to? And it finally occurred to us that it seems to take somewhere between 6 and 10 years to truly change the minds of a mass market and to get all of us to sort of like have a change in behavior. And so, the point in time when companies go public is when that sort of change in behavior has really caught hold. And So, if you look at companies that go public before, they probably haven't really gotten to that point yet. And companies that go public after have probably never really defined a great category because they've just sort of been sitting there doing their thing for a long time, but it really never really caught on. Now, Uber was founded in 2009. So, at this point in time, it's, um, you know, right in its sweet spot of when it should be going public. And if, um, you know, if it— it's, you know, if it waits until it's, you know, 2019 and beyond before it goes public, you can— you can bet there's probably something wrong there. And it's not really— maybe that company design problem has really stalled it out.

And well, you know what's interesting? I, I mean, there was— there's a company that everybody thought was going to take over the world not too many years ago, and that was Groupon. And that just cratered. I mean, it's still around, of course, but a lot of missteps. It just didn't work out. And the company design issue that you mentioned is really telling because at first the merchants loved it, right? They thought, look at all these new customers they're sending me. But then none of the customers stuck. There just wasn't much stickiness. Basically, it had the effect of just reducing prices and pricing power for merchants. How many Groupon massage offers do you need? I mean, everybody becomes disloyal and they go to the new deal of the day.

Well, yeah.

It's interesting to see Groupon, LivingSocial, all of the daily deal sites in that category that just, I don't know, that just never really worked out, although it was the hottest thing for a while. I, I mean, that's my perception at least.

Well, let me, let me, let me put it like a slightly like our lens on that. Groupon was founded in 2008 and it went public in 2011, 3 years later. Um, and so, I mean, so Groupon, if you want to just sort of just take strictly from like the, you know, the evidence that we put together, you would say Groupon just never developed that category or didn't develop it to a point where it stuck. It rushed to an IPO, probably because it recognized that the category it was in was not going to stick around for very long. If that's the case, in a way, it swindled investors. It led them to believe that it had something that was going to be great over the long term. When it probably— it may have known that it had tapped into a short-term phenomenon. Why else would you go public 3 years after being founded? So that's a great example of if you see that happening— I mean, basically, there's no way I would buy the stock of a company that went public that quickly because One of the things that we would say is that there's just no way that it has actually developed a category that's changed the way we're thinking in a way that's going to stick around.

Okay, good. Good stuff. Well, hey, just, you know, can I ask you one other question just on your other book? I want to switch gears for just a moment. So The 2-Second Advantage: How We Succeed by Anticipating the Future Just Enough.

Give us the Well, the book was about the intersection of computer science and brain science. And one of the things that brain science has taught computer science is that our brains are prediction machines. We're constantly predicting what's just about to happen and acting on it. That's basically the way we survive. get through the day. And in fact, if you look at what really talented people do in that thing that they're very talented at is that they can make better predictions a little farther ahead than anybody else. It's almost the definition of talent. And so, the book was about how computer scientists are taking those kinds of learnings and trying to build in an ability for computers to take in data and instead of just crunching and analyzing data, use data to start to predict what's about to happen and act on those things autonomously. And that book came out in 2011. And a lot of the things that you're starting to see happen today, some of the things with autonomous cars or IBM's Watson computer, are manifestations of that work that was going on then.

Yeah.

Interesting. It really is an amazing time to be alive, isn't it?

It is. And you know, I'll tell you, um, what's coming in the next 10 years is going to make what's happened so far— I mean, when you look at things that are going on with artificial intelligence and 3D printing and virtual reality and all these technologies and nanotechnology, biotechnology, it's mind-boggling.

I, you know, tell me if you, you think I'm right, Kevin. I have been I've been saying for years that we are truly at an inflection point where we are about to see, or we're already in it, the hockey stick, the famous hockey stick on a graph, right? Where it's just mind-boggling. Now, granted, like I always say, maybe this is what people thought when they invented the steam engine and the light bulb and all of these things in the past, but it just really feels like there, there's this kind of coalescing right now of all these different technologies in a networked world where we have frictionless commerce, frictionless, near-perfect pricing of goods and services. It's not perfect by any means, but it's more perfect than it's ever been.

Yeah.

And I always like to say geography is less meaningful than it's ever been in human history. A lot of amazing things.

No, no, it's absolutely true. And, you know, 2007 was— boy, it was an inflection point. 2007 is when the iPhone came out and really, you know, the iPhone, cloud computing, social networks, all those things around that time sort of gelled and created essentially the world we've lived in for the last 9 years. And so, all of those things were game changers enough. But again, as we were just saying, I mean, these other things that are starting to emerge, the artificial intelligence and nanotechnology, 3D printing, all these things on top of that platform that we've already established is just going to completely reinvent Yeah, it really is.

It really is. Give out your website. Tell people where they can find out more about you.

Sure. Well, the easiest one is just kevinmaney.com. That's my personal website.

Good stuff. All right, Kevin Maney, thank you for joining us.

Um, you're welcome, Jason, and thank you for having me on.

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If you want to be able to sit back and collect checks every month just like a banker, Jason's Creating Wealth Encyclopedia series is for you. This show is produced by the This show is copyrighted by the Hartman Media Company, all rights reserved. For distribution or publication rights and media interviews, please visit www.hartmanmedia.com or email media@hartmanmedia.com. Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate, or business professional for individualized advice. Opinions of guests are their own, and the host is acting on behalf of HartmanMedia.com exclusively.