2. www.exponentialview.co
www.exponentialview.co
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3. www.exponentialview.co
0 125 250 375 500
2007
0 225 450 675 900 1125
2017
Source: Bloomberg, Form 10-K, 2017
The age of technology
5. www.exponentialview.co
The Cycle of Tech Revolutions
1770 1820 1870 1920 1970 2020
INNOVATION
CANAL
MANIA
GREAT
BRITISH LEAP
The Industrial
Revolution
RAILWAY
MANIA
VICTORIAN
BOOM
Age of steam
and railways
GLOBAL
INFRA. BUILD
BELLE
EPOQUE
PROG. ERA
Age of steel and
heavy engineering
THE ROARING
20s
POST-WAR
GLOBAL AGE
Age of oil, autos
and heavy production
DOTCOM
& INTERNET
MANIA
THE
KNOWLEDGE
AGE
The ICT revolution
6. www.exponentialview.co
The economy will continue to switch to
intangibles with broad implications
Sunk cost investments
Highly scalable, winner-take-all plays
Spillovers (which includes copying)
Synergies (partnership approaches, internal culture)
Source: Haskel, Westlake, author analysis
Suggests a “venture capital”, startup building model
7. www.exponentialview.co
Exponential change in technology inputs
59%
50-60%
37%
29%
A technology which
improves at 10%+
every year at a fixed cost
Moore's Law
Kryder's Law
Keck's Law
Hendy's
Law
LiIon battery 19-20%
8. www.exponentialview.co
Positive feedback drove the PC
dividend
CPU
OS
quality
Increased capability
Software
Reduced
performanc
e
Greater
sales
• Major winners (Intel, Microsoft)
• New industries
(PC, peripherals, networking,
software, video games)
• Impact on other industries
(computerisation)
13. www.exponentialview.co
Beyond GPUs to dedicated ML silicon
Source: Nvidia Investor Day Presentation, 2017
Dedicated ML (Google, Graphcore)
(10-1000x improvement on current GPUs
for deep learning promised)
Driven by
massive computer demand
for artificial intelligence
which is the software glue
binding services together
14. www.exponentialview.co
There is a convergence of exponential tech
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
$100M
$10M
$1M
$100K
$1K
COST PER GENOME
Source: National Human Genome Research Institute, 2017
15. www.exponentialview.co
There is a convergence of exponential tech
MARKET VALUE AND SHIPMENTS OF CMOS SENSORS
0
4
8
12
16
0
1.5
3
4.5
6
7.5
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
MarketValue($B)
WorldwideUnitShipment(B)
Source: IC Insights
15%
CAGR
24. www.exponentialview.co
Value is created faster than ever before
0
2
4
5
7
9
11
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Yearsto$1bnvaluation
• Docusign
• Shopify
• Palantir
• Facebook
• Whatsapp
• Spotify
• Twitter
• Evernote
• Dropbox
• Box
• Tumblr
• Mongo DB
• Cloudera
• AppNexus
• Pinterest
• Airbnb
• Uber
• Stripe
• Instagram
• Square • Snapchat
• OculusRift
• Slack
NUMBER OF YEARS TO REACH $1BN VALUATION FROM THE FOUNDING DATE
Source: GartnerSYM, 2016
25. www.exponentialview.co
These feedback loops create non-
linear results that are hard to predict
1 3
6
9
14
18
25
0
7.5
15
22.5
30
2011 2012 2013 2014 2015 2016 2017
$Bn
ALIBABA Singles Day SALES
77%
CAGR
120
66
90
26. The rate of change is increasing
Deployment of new consumer propositions is
happening faster than ever before
Source: Horace Dediu, Personal Correspondence www.exponentialview.co
28. www.exponentialview.co
ML compute meets IOT
illustrative to 2028
17%
CAGR
50%
CAGR
c. 60x
over ten years
c. 5x
300x IOT
compute
Value creation
Apps?
Systems?
Infrastructure?
Business models?
2nd order effects
Power utilisation
Network usage
Data creation
Security?
30. www.exponentialview.co
AI, automation and new business models will
restructure work. How will economies adapt?
Which economies & workforce
can adapt to the changes?
European model?
High trust
High education levels
Strong safety nets
Greater institutional mechanisms
for worker / firm dialogue
US model?
Business-centric
Highly agile, lower friction
Market mechanisms
Automation
Broad automation, leading
to widespread job displacement
Platformisation of work
Increasing use of ‘thick platforms’
to orchestrate ‘free lance work’ vs
traditional jobs
42m
(3x by 2020)
Americans
freelancing
800m
global job
changes by 2030
(McKinsey)
375m
workers needing
to retrain
(McK)
of which