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The Big 4 Face Congress

The United States Congress has labelled Apple, Amazon, Google, and Facebook as monopolies officially for the record. In a statement at the hearing it was said that “some need to be broken, and all need to be regulated”. As big tech gets even bigger, governments around the world seek to regulate them in some way. We just saw congress, in a widely publicized event, ask some really hard questions to the tech leaders in a bipartisan way, even during these increasingly polarized times! 

Dr. Seth Benzell
Speaking with Dr. Seth Benzell, a digital economist from MIT, we learned about how we should look at the issues that have come up from Big Tech and the drastic imbalance of wealth that they have created. Seth has spent a lot of time thinking of ways to keep Facebook accountable and make sure that the gains being made out of our data are shared across users rather than just the Zuck at top. He takes us through some of the options of how to even start thinking about regulating these companies, like taxes and transfers. 

Why Inequality Matters

Inequality should be important to everyone because of the following beliefs.

1. Ultra wealthy individuals have a diminishing marginal utility from their wealth (remember money doesn’t buy you happiness, but instead freedom and access to things most will never experience)
2. The utility for society goes up overall when someone gets access to food more than Bezos getting a 5th yacht (more for the common good)
3. We should think of the economy as a pie and split it in a equitable way 

These points bring up the question, Can we slice the pie in a more equitable way and how do we do that exactly?

Seth states that “The way we all win is by making the pie bigger… with more equal pay in a more equitable way.”

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In our most recent episode, Things Have Changed had the opportunity to speak and learn from Dr. Seth Benzell, Digital Economist, Assistant Professor at Chapman, Fellow at MIT Initiative on the Digital Economy and the Stanford Digital Economy Lab, and a huge Sci Fi Fantasy aficionado. Automation has been a reoccurring theme in corporations quest to improve their bottom line and stay competitive. Seth is at the forefront of understanding Digital Automation and its implications on employment, growth, and inequality.

In ongoing research, he studies the effect of application programming interfaces and ‘firm inversion’ at the firm and macroeconomic level. He has worked on multiple studies of tax reform in computable general equilibrium models and has briefed legislative assistants at the U.S. Capitol.

Paradox of Robotic Productivity

Seth’s research has found that an increase in robotic productivity will temporarily raise output, but, by lowering the demand for labor, can lower wages and consumption in the long run. It’s difficult to look at how robots will help future workers because while outputs are increased with similar inputs, workers aren’t compensated equally while those that own the robots are getting the biggest piece of the pie. If the market response to robotic innovations does not lead to a positive result, then there may be a need for government intervention with redistributive policies of the state.

Labor share of GDP Decreasing

One way to look at how automation has increased productivity relative to wages is to look at labor share of national income. In the early 1980’s the labor market made up 65% of the national GDP. Today it’s a mere 50% with an enormous boom of wealth from Superstar tech companies and investor capital. It’s projected that 20 Million manufacturing jobs will be obsolete by 2030. This disruption in the labor market is not new and has been going through different iterations from the Industrial Revolution to the development of computer processors.

The Rise of Superstar Companies 

Superstar companies are 10% of businesses that create 80% of economic value. You can already guess who these are… Amazon, Apple, Microsoft, Facebook, Google, and many more. Nearly all of these Superstar companies benefit from some form of automation that allows them to create maximum production with minimal labor forces. Due to heavy reliance on automation, Superstar Companies have been able to maximize profit for investors, and pay less to the labor market for it. This has created issues with local economies that lose tax income and economic activity of consumers.

Should Digital Businesses be Taxed?

While automation is designed to solve problems and create greater efficiencies for companies, it comes at the cost of inequality in wages, a decrease in tax income for governments, and higher barriers to entry for new entrants. A proposed solution that’s being explored is France’s plan to tax Digital companies revenue at 3%. The argument is that the tax proposals have the potential to shift billions of dollars from tech companies to local economies. This standard tax rate for digital companies attempts to capture the profits of tech companies benefiting from the savings that automation gives them while cutting the needed labor force down.

• Seth's Twitter
• Robots coming for your paycheck
• Seth's Working Paper
• France's 3% Tax

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Co-working has clearly shaken up the commercial real estate market. Offices across the world have been greatly influenced by the autonomy and flexibility that a co-working space offers.

The ability to shape your office to match your specific needs, be it optimizing performance and/or collaboration, can be counted as one of the main driver behind companies opting into these agreements & ditching traditional offices.

Today we speak with Shesh Paplikar, CEO and Founder of BHIVE Workspace, one of India's largest co-working spaces founded in Bangalore, India. Shesh is shaking up the Indian workspace environment with solutions to deep rooted challenges that have existed within the traditional office market for decades.

By focusing on reliability of power, connection, and superior service, Shesh is raising the bar of what is expected from Indian workspace locations. 

In this episode on Things Have Changed Podcast, Shesh breaks down the triggers that led to his move from leading at Bloomberg R&D in Manhattan to starting his own company in Bangalore. We understand the dynamics & pricing structures within commercial real estate as well as the hurdles of operating a co-working space in a global pandemic. 

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Spotify had to find a way to create a true differentiator to Apple Music & increase margins. 

Spotify doesn’t have the luxury of selling iPhones at a high markup to fall back on so it still loses money. Streaming music isn’t cheap given the need to pay labels, artists and publishers based on consumption. 

What's the solution then?

Well... Podcasts!

Spotify has acquired four podcasting companies in the past 12 months! 

• Spotify paid $340M to acquire content studio Gimlet and hosting platform Anchor
• Podcast content studio Parcast for an estimated $100M. 
• Ringer for $200M

But this did not quench their ambitions. They wanted the biggest fish in the pond, the Joe Rogan Experience.

A staggering $100 million fee was needed to bring the entire JRE library exclusively to Spotify. Joe Rogan is probably like, "Jaime pull up my account balance"

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Things Have Changed Podcast uses a platform called Squadcast to record our podcast conversations. Prior to using Squadcast, the team used another service that did not allow visual interactions, which caused a strain on our conversations. We did not realize how important it was to see our guests until we joined Squadcast. The quality of the conversations got so much better!

The Bootstrap King

Things Have Changed Podcast sat down with Zach Moreno, the Founder of Squadcast and the first recipient of our  "BOOTSTRAPPER" award. Zach has spent his life solving problems with his knowledge of being a full-stack web developer. He used web developing to empower businesses that he worked with. Through doing projects for other companies, he built up his expertise and finally built Squadcast with his long time friend, Rock Felder.

Progressive Recording

Squadcast's goal is to amplify collaboration. The technology behind Squadcast is even more fascinating: it is called Progressive Recording, and it means that Squadcast is constantly uploading that audio data to the cloud as you are recording in real time. For podcast recording, this is vital. As more of the world goes into the internet to communicate, bandwidth might be an increasing cause for concern. Squadcast aims to bridge that gap.

Building Communities

The most fascinating thing about the story of Squadcast is that it was built like Zach had lead his life. He built it is as a community of passionate artists, innovators and entrepreneurs. On the advisory board, there are some podcast giants like Jordan Harbinger, a 13-year podcast veteran; Pat Flyn, creator of Smart Passive Income; Espree Devora, host and creator of the show, Women in Tech; and many more podcasting entrepreneurs.

As you can see already, the team is filled with the leaders in the industry. Squadcast also has a robust feedback loop. If you go through their blog, you will notice that customers have given feedback that has turned into a feature or stories of people who have contributed to the growth of Squadcast.

Check out our conversation with Zach on how he built Squadcast! 

Some helpful links:

• Squadcast Website (If you make podcasts, you should probably sign up today)
• Zach Moreno LinkedIn
• Podcasting Industry

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Although the political landscape has largely leaned towards more positive sentiment towards cannabis, it is still very expensive and risky to do business in the industry largely because of compliance burdens like tracking the entire operation from seed-to-sale. 

• Cannabis companies often spend 1/3rd of their time on compliance-related issues. 

There are licenses required to do different parts of the process like growing, manufacturing, selling. What’s worse is, they cannot participate in the financial markets because banks will ultimately get fined for doing business with them. 

Regulation 280E and Significant Growth Constraint

The cannabis industry has been set up to fail. Although it’s getting more mainstream, there are still significant choke points that prevent businesses from thriving like Regulation 280E, a piece of legislation that punishes banks for doing business with any company that deals with a schedule I or II drug (Cannabis is still a Schedule I drug federally). Some large cannabis companies receive their transactions in cash only and have a difficult time getting capital to scale businesses. Furthermore, individual states have different regulations and amounts of license, which makes it much more difficult to participate.

Capital comes to Cannabis

As the industry grows and becomes legal in more states, there is a new interest in investment. In 2018, there was a $13Bn investment into the legal marijuana industry up from $3.4Bn in 2017. When capital starts flowing into the industry, the entrepreneurs start finding ways to solve more problems! 

We talked to Stacey Hronowski, an entrepreneur that is trying to get rid of the compliance burden by creating an enterprise resource planning (ERP) tool called Canix to handle just that. 

Since everything from growing the product to selling it needs to be tracked, Canix has found a way to make it easier for businesses to collect their data, use their data, and strive with it. As I was pointing towards the gold mine of data in the podcast, Stacey kept emphasizing the importance of understanding what the customers needs are with the data that they collect.

Canix doesn't only become an ERP for compliance purposes but also a place to figure out how to become successful in the industry. The current suite has all sorts of functionality like live inventory tracking, METRC integration (The regulation stuff), chart of accounts management (the accounting stuff), RFID harvesting, and clone data. Yeah.. if you aren't very familliar with the industry, Stacey can help explain that to you! 

Sit back, light it up, and absorb a little more than THC and CBD. Actually, just a lot of THC. 

Consume that. 

A dose of Things Have Changed (THC).. That's us.

Some Helpful Links:
1. More Information on Canix
2. Cannabis Software
3. How METRC fits in

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In March 2019, over 4.4 million blogs were published around the globe every single day. With only so many writers, it’s becoming difficult to create stories from the amount of data we have today. 

Przemek Chojecki, Founder and CEO of Contentyze, aims to fix the inefficiencies in  journalism with a content generation platform built to disrupt how journalism and content marketing works through Artificial Intelligence.

Contentyze

Contentyze’s goal isn’t to replace journalists, but rather assist them in their writing, helping them to focus on the creative side of things while improving their writing craft. Though Contentyze is in the early stages of development, it has already conducted over 1000 interviews of executives in a very short time period. A streamlined content generator at scale.

Artificial Intelligence Trailblazer and Forbes 30 under 30

Przemek’s background is extensive and has taken him to new frontiers that haven't been explored. Born in Warsaw, Poland Przemek has always been curious about mathematics and research. Completing his mathematics PhD in Paris, Przemek became a Research Fellow at Oxford University. Having a passion for writing Przemek authored 3 novels with topics ranging from his learnings about AI, traveling the world, and even philosophical conversations on the meaning of life. 

A former Forbes 30 under 30, Przemek has been recognized for his work in AI and constant curiosity to find answers and meaning in our ever changing world. Join us to learn about Przemek’s extensive research background, Contentyze’s mission, and how AI is changing journalism today. 

P.S. this was not written by a bot

Helpful links:

• AI Future of Journalism
• Przemek's Medium
• Przemek's Personal Website (Data Science helpful info!)

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Smoking kills a person every 5 seconds!

Seventy-four percent of Americans who smoke say they would like to give it up per a recent study. Although quitting can be a challenge, there are a number of methods that have been proven to help, including nicotine gum.

Using nicotine gum decreased the odds of lapsing by 55% compared with using placebo, in a recent well cited publication in PubMed. The science behind harm reduction products in comparison to smoking seems to hold true, and COVID has provided a wake-up call, as smokers turn to alternatives in record numbers.

Lucy was founded by John & David, founders of Soylent, who were dissatisfied with the traditional nicotine options, “nicotine replacement therapies,” or NRTs available and decided there had to be a better way. The goal was to decouple nicotine from the tobacco plant, with its smoke and tar, thereby allowing smokers to still enjoy mood and performance benefits while minimizing negative health effects and the risk of dependence.

In Part 2 of our conversation with John Coogan, he dives into his new company Lucy's goal to be the viable Nicotine alternative needed to encourage people to move away from legacy tobacco products.

Listen to Part 1 of John Coogan's conversation with Things Have Changed where we dive into the origins of Soylent and building it into a cult brand!

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John Coogan, Rob Rhinehart, Matt Cauble, and David Renteln sought the perfect balance between nutrition and convenience.

Soylent was created from a need to find a simple, nutritious food source & created a formula consisting of 100% of the daily value of necessary vitamins, minerals, and macronutrients obtained from normal meals.

In 2013 Soylent raised $3M, the most ever seen for a food product on a crowdfunding campaign & quickly grew into a cult following in schools and colleges all across America.

In the Part 1 of @johncoogan conversation with THC, we cover Soylent’s early days, the incredible community & virility it garnered, and the D2C model with demand so high it took Shopify servers down!

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There is a price for pollution, and companies are heavily involved in pricing carbon to meet environmental regulations. Today, a cap-and-trade system exists, where the government sets an overall ceiling on emissions from key industries.

The idea here is that instead of using regulations to force companies to curb their emissions, polluters can be made to pay for every ton of CO₂ they emit, providing them with an incentive to lower emissions on their own.

Companies, however, in order to meet these strict caps, look to buy credits. This has resulted in a secondary market of buying and selling these precious carbon credits between companies.

For example, automakers such as GM & Fiat paid Tesla a record $354 Million Last Quarter! Imagine giving millions to your biggest competitor & a disruptor in your industry to meet environmental regulations. This high cost has forced many businesses to formulate strategies and products that are less carbon intensive.

We ask Maria Fujihara, Founder & CEO of SINAI Technologies, a Y-Combinator backed company that aims to help companies price carbon more effectively! The first step to combating climate change for businesses is for them to understand their contributions to it & SINAI are leading the efforts on carbon finance.

Links:
Carbon Pricing Dashboard

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