The $350 Million Social Experiment
I had the opportunity to spend last week in Las Vegas, visiting the Downtown Project. Wow.
Tony Hsieh, founder and CEO of Zappos, had headquartered the company in Henderson, NV, because of convenience with logistics, and an ability to set up the world class customer service center they have built. Inspired, I have to assume, out of an effort to create a community in Las Vegas that supports Zappos, Tony decided that his next project would be the “city-as-a-startup”, so he created the Downtown Project.
The Downtown Project is a $350 million investment in the downtown Las Vegas area: 200M in real estate, 50M in tech, 50M in education, arts, culture, and 50M in small business development. Many people assume downtown Las Vegas means Caesar’s Palace and the Bellagio, but the Strip actually was an unincorporated piece of land outside of the city of Las Vegas, a small desert town in Nevada. That small desert town, with an urban density of ~15 people per square mile, is rife with deserted lots, high crime-rates, and the among nation’s worst-performing education systems. The Downtown Project hopes to revitalize the region, measuring its success with a new metric: “Return on Community”.
As Andy White of the Vegas Tech Fund described it, return on community is counterintuitive to most perspectives on investment. While we tend to think of a commercial interest making stakeholders happy, they assume their stakeholders are happy, and operate from there. Under those conditions, commercial interest is a likely upside, but not the only one. And the only stakeholders that are drawn to this model are the ones who align with their value set, and will help them with their goal. It draws on lessons from the Zappos Culture story, where they focus on the values first, and trust that the upside will be a natural byproduct of the right values. It works well with a service-oriented e-commerce business, so why not with a city, right? Well, we’ll see.
TechCocktail, the organization that hosted me during my stay, has brought a fascinating group of thinkers and dreamers from across the spectra into the fold, and the Speaker Series, where I was very pleased to share some thoughts, was an audience of life-long Las Vegans: true community members, working on problems from their city, for their city. Tony Hsieh reminds me of Elon Musk in a way. They both have what I describe as Howard Hughesian ambition: they see a problem, no matter how big, and say why not? When met with “that’s impossible” they become more insistent, and they are pioneering models that others have no choice but to follow. And actually “returning community” might be the only thing that’s as difficult and worthy a goal as putting a man on the moon. Hats off.
On Science Fiction as Future Innovation.
I’ve always been a fan of Minority Report. The technology felt accessible but futuristic. It planted itself into my imagination, and that of many of my peers. When Spielberg wanted to create a cinematic but realistic 2054, he assembled a group of technology experts and futurists to help him design the interfaces on Minority Report. What came out of it were iconic images, indelible in my subconscious: self-driving cars, touchscreens, gesture-controlled devices, personalized, cookie (or retina)- driven advertising. And wow! We have all those things now!
As this article points out, we were misled. All of those concepts were more like 10-15 years out than 50-60 years out. And by aiming low, it actually ended up framing our expectations of future innovation incorrectly. Science fiction frames future innovation. Nathan Shedroff gave a great talk last year at Creative Mornings at Chronicle Books in San Francisco about how the kids who loved sci-fi books and movies when they were young ended up becoming the technology nerds whose imaginations were framed in the context of Philip K. Dick, Orson Scott Card, and Isaac Asimov and Star Trek. While imperfect, the course of future imagination in art and culture has a profound impact on what interfaces technology pioneers end up creating. Technology creators all, on some level, expect to one day remark, “we’re living in the movies.” It’s romantic, really.
But are we doomed to a future of Pictures Under Glass? Bret Victor excoriates us for our conventional wisdom around interaction design in this brilliant article, describing all touchscreen interfaces as “pictures under glass.” We have hands with opposable thumbs, and we use depth perception, weight assessment, gravity, balance, and the sense of touch to manipulate our environments in extraordinary ways. Why don’t we do the same with computing, rather than these 2-dimensional and ultimately limiting interfaces?
I wonder if the word “interface” is the problem, in and of itself. In “The Best Interface Is No Interface”, Golden Krishna describes cars, fridges, thermostats, tables, and lights that are programmed to act on our behalf, and with us seamlessly, through computers, but without UI. In the late 1980s, Mark Weiser proposed “ubiquitous computing”, well before the personal computer was even truly ubiquitous. By 1998, The “Internet of Things” had appeared in articles, and at the most recent CES, it seemed as though every other presentation was about putting brains into all sorts of devices, ideally without a need for a screen. So there’s progress. But if you look at the headlines about the tablet race and listen to the trends about mobile device adoption, it’s clear that the the focus is on touchscreen devices, and innovation in interaction design may be stuck, at least for a while. Perhaps the Minority Report trap will be harder to shake than I had hoped.
The Apple Store: Haute Matériel
Today I had the opportunity to go to the Apple Store in Palo Alto while waiting for a meeting. Given that I bought my last few Apple devices either online or from friends, I haven’t actually been in an Apple store in a while. It was kind of an eye-opening experience.
They have a half-dozen sections of non-Apple products, including cases from Incase, Speck and others, some branded by Marc Jacobs and Kate Spade; handbags by Marc Jacobs, Michael Kors; Harman Kardon headphones, Jawbone speakers, other tablet-type devices that are apparently meant to go along with desktops; smart keyboards and stands; and a shelf for fitness and wellness devices, thermostats, LED lamps. I was struck by two observations while browsing the myriad items:
1. Apple is more than a technology brand. It is a luxury brand, who seems to be working on a luxury empire not so dissimilar from LVMH. The Stanford Apple Store is directly next to Tory Burch. While you can also buy an iPhone at Walmart, it still costs hundreds of dollars. And for their retail experience, it is clear: nerdy glamour is real. Amanda Peyton is right. I wonder if they intend to acquire any of these companies, or just built a moat around their brand by offering luxury retail distribution for device makers. The iPad and iPhone are still their bread and butter, after all.
2. On that note, I also read that Apple accounts for 20% of all consumer technology revenue*, followed by Samsung, HP, Sony, and Dell. The big three** — phones, tablets, and computers — dominate the consumer technology landscape, and based on the growth trends, it looks to soon become the big two. I have to suppose that other technology outside of mobile devices will rise into the categories where computers and TV’s once were: will that be thermostats? Lamps? Wristbands? Watches? If Apple thinks that’s true, then I wonder why they are selling others’ products, instead of building them themselves.
These things aren’t new, it’s just surprising and exciting to me how quickly this luxury technology space is growing. I’m increasingly leaning into brand-name technology, not only for functionality, but as a form of cultural expression. We all will, soon. I wonder if haute matériel — haute couture for technology — will move consumer electronics purchasing power permanently away from the 18-35 male. Some suggest it already has. For the better, if you ask me. If the technology community has to acknowledge that it’s building the future for women, then one hopes it will do better to embrace and celebrate more women as the builders. Well, I wasn’t expecting my train of thought to go this way, but heck: not mad at it.
**TV’s are toast.
On Venture Financing: Not All Seed Capital Is Created Equal.
Many people think of seed funding just as “before Series A” — somewhere in between “back-of-the-napkin” and “company-with-employees-and-monthly-revenue”. And, technically, they are right. Under $2M, a company tends to raise debt, a Series Seed, or perhaps a Series AA. But in the context of seed, there is wide variation in both the size of the round, and the type of seed investors which an entrepreneur can choose. The nuance between these is important, so I’ll describe my understanding of it below.
Friends and Family—
When people in the startup community refer to “cobbling together money from your friends and family” they are referring to this category. It is usually between $10,000 and $100,000 for the whole round. Not everyone has access to this amount of money (or credit). Anyone who claims that anyone can do a start-up, or that it’s a meritocracy, likely has access to rich family and friends. It’s sad, but it’s still true.
The people in this category are not necessarily professional investors, nor are they always accredited. They may not understand that startups are extremely high-risk, or that they take a long time.
The angel is a professional investor in your industry, and so understands more detailed nuances of the transaction than, say, your uncle. She may double as an advisor, and in fact the best angels bring more than capital. And she may not be someone you’ve known your whole life, but only professionally. She comes in very early, does a fair amount of diligence, and often likes to come in with a bigger, more substantial partner. Some angel investors can write big checks, but most angels write checks between $10,000 and $250,000, not unlike friends and family. These investors are very helpful advisors early in the business, and as you grow, are often your biggest fan and loudest advocate.
Dedicated Seed Fund (Small Seed)—
Once a professional investor in technology has been at it for a while, she may decide to either raise or join an institutional fund. This happens more often than not, because if your main career function is making investment decisions with your money, why not make it with other people’s money, too? The smallest type of institution is a dedicated seed fund, usually representing pooled capital in a Limited Partnership. At this stage, A firm may decide to invest a relatively small amount of capital, but build a portfolio, offering a thin set of services relevant across that portfolio. Those firms who take this strategy tend to invest between $50,000 and $350,000 in companies. Some of these may ask for equity, so that they can negotiate pro rata and other investor’s rights. In asking for equity, they may offer more in the way of services. The smaller ones may just hope to find dealflow early, or invest in friends and former colleagues who are likelier to provide them with friendly economic terms. Another class of firms at this stage provide a robust suite of services; their resources extend far beyond capital and advisory. Depending on the dynamics, these firms invest only a small amount for a relatively large stake, justified by the fact that they accelerate a business substantially over a short, concentrated period. Many incubators and accelerators follow this model.
Micro VC (Big Seed)—
After a certain size, the hurdle rate rises such that a firm has to make bigger investments in each company it supports, so that they can deploy their capital more quickly, and especially so that they can get bigger allocations in the investments. The range of investment in this category is between $250,000 and $2,000,000. These firms often purport to offer even more services than a small seed fund, though still less than an accelerator. In some cases, they aim for 20% of a business, which what a lifecycle venture fund might aim for in a Series A investment and beyond. Based on their allocation, these firms sometimes take a board seat, and may maintain pro rata through a company’s early funding rounds.
“Opportunity Fund” Seed—
Two factors drive this category of investment. First, big funds are getting increasingly competitive, with the value concentrating in a power law distribution, and the few winners vastly outperforming the majority of funds. Second, realizing that start-up companies are able to approach escape velocity earlier and earlier, many big lifecycle funds now invest in start-ups at the seed level, as well. These funds will invest $100,000 to $1.5M in a start-up company, often as a convertible note, as a way of starting the relationship with the entrepreneurs early, and maximizing the opportunity for choosing the right companies to invest in at the life-cycle stage, where these funds will invest $10,000,000 to $25,000,000 over the life of a fund. These investments are very small for a big firm, so they usually devote substantially fewer resources to each investment than they would for their traditional, bigger deals.
Why these nuances matter:
Not all seed firms will work well with each other. You may already be wise to the fact that big funds with seed investment may be bad signaling (though that is unclear to me) in case they don’t lead your Series A. But it’s worth noting that many Micro-VCs can’t work together on a deal if you’re raising below a certain amount. When you put together your syndicate, it’s worth considering how the needs of each firm line up with the size of your round. Of course, start with the amount of money you you’ll need (more than you think), but keep in mind that as you hone in on your wishlist of advisors and supporters, that they are operating under their own constraints. Try to understand those constraints early.
First of all, know what your peers are working with. More experienced investors have developed an instinct for who they tend to fit with in syndicates, structurally, versus not. But when you’ve raised a new fund, or have just raised a second fund that moves you from one category to a next, be mindful about which category you fall in. Start with your needs, but measure those needs against your strengths. Do you know a ton of angels, who can fill out syndicates that you lead? Or are you looking for other seed-focused institutions to join you in rounds? How can you optimize these channels, not just for your venture economics, but for the benefit of entrepreneurs you want to support?
Online Education’s Cheating Problem
Biometric keystroke analysis interprets the rhythm and styling of a user’s typing to identify who the user is. Coursera, the Palo Alto-based online education company, has begun offering this technology, coupled with photo verification, as an authentication tool for its users. This will enable the company to offer course certifications for sale through partner institutions. Earlier this month, a few journalists covered this release. They pointed to this as early signs of Coursera’s business model, which has to this point been a free service. Harvard, Princeton, Stanford, and other top flight institutions who offer free classes on Coursera are noticeably absent from this pilot, a detail not lost on those who have described the launch. But this commentary misunderstands the significance of Coursera’s new product feature. If you ask me, online education is still being held back. And the number one problem is cheating.
The reason online education of the modern ilk — the MOOCs and the sexy collaborative businesses — have yet to take off is because they still lack accreditation of the robust, government-certified, culturally approved form that a B.A. or B.S. affords. This accreditation has driven applicants to traditional and vocational schools in record numbers, has created a number of extremely profitable online businesses whose value is debatable, and has left the United States sitting on $1 trillion of student debt. A future where education is lifelong, part-and-parcel, a mix between vocational training and learning out of interest, and delivered dynamically from a mobile device, a web service, and in person, relies on accreditation moving across the services. Startups like Degreed look to solve this problem by offering a credit that reflects the dynamic set of educational experiences available today. But how do you prove who is sitting behind a computer while submitting a block of code, or writing an essay, or completing a calculus derivation for an economics problem?
Of course, cheating is not a new phenomenon, nor is it restricted to online education. Every higher learning institute in the country has some version of an Honor Code and an anti-cheating policy. Plagiarism is a capital offense, in school language. But we all acknowledge, if reluctantly, that there’s a fair amount of cheating that happens anyway, and that the best defense against it is to impose cultural taboos, which have developed over 1000 years. These taboos don’t exist in the same way online, and are in many ways the opposite. The most celebrated developers, designers, and engineers copy, remix, and edit from across the internet throughout their days. And the best online students are doing the same. In a study conducted at Ohio State University, 72% of students reported cheating on one of the tests administered online during an Introduction to Psychology class. The concept of an individual’s ability to recall and create in a vacuum — which I question as the best form of testing, anyway — is not relevant to an internet era of work. We are constantly retweeting, attributing, sharing, and collaborating. But as long as testing is an individual sport, certification needs to be, too. And the masses care about certification.
Funding channels move upstream.
Speaking to an office full of YCombinator founders this week, I was struck by how they described what they imagine to be the future of YCombinator. As they noted about the most recent graduating class, many of the top performers in the class had months of recurring revenue, with double digit month over month growth and significant traction. YCombinator is getting more and more mature, and companies are graduating from the three month program with traction, customers, and revenue. This is largely because, according to the founders I spoke with, applicants are getting stronger and stronger. Lately, companies are incorporating, building their alpha, and even beta, and then applying to YCombinator.
By this argument, the rising valuations of YC companies on Demo Day have less to do with the improving brand of YC and cult of PG, or with the mentorship within the program (which I hear has been diluted with size) but instead speaks to the fact that companies are applying to the incubator later in their cycles. 15 years ago, venture capital fundraising was once a matter of relationships and a PowerPoint presentation, but has since moved way upstream. Startup costs dropped, thanks to cloud computing and Moore’s law; today, by the time you’re raising venture capital, your product likely has at least tens, if not hundreds of thousands of users, sustained growth, and revenue.
This created a gap in the funding ecosystem which brought on what seems like a glut of angel investors, seed investors, and super seed investors. It also brought YCombinator. But that seems to be changing. This funding ecosystem once provided people with “just an idea” a place to get mentorship, infrastructure, and a chance to grow before the big show. In the case of YCombinator, it seems like they’ve moved upstream, too. By the time you’re applying to YC, your product is much further along today than it was when YC first interviewed the likes of Loopt and Reddit. Yes, pg pioneered the accelerator model to respond to the gap, but may be creating a new gap in his wake. I wonder if there will be another generation of programs fitting in the space YCombinator leaves behind.
What is a “scalable” product?
I want to re-define it. Chris Dixon points to this post, which defines “scaling” as:
dealing efficiently with events that occur with a predictable frequency.
This refers to the type of scale that is described in freshman economics classes. It unpacks the law of large numbers, and has important implications for the way computer scientists design systems. By that definition, a scalable business is one that can be organized in such a way that when its purpose is repeated with increasing frequency and scale, things don’t break.
Paul Graham defines a startup as:
a company designed to grow fast.
By this definition, the question of whether or not a company is scalable makes a lot of sense. It refers to a product’s natural capacity to get a lot of users very quickly. The successful start-up is the one that can make something lots of people want, and reach and serve all of those people. And “scalability” is the litmus test for that success.
But “can get to a lot of people” is the wrong litmus. Facebook, for example, makes something lots of people want, and it reaches and serves all of those people. And it got there without its core technology breaking. It is scalable, and it is “at scale’. But the Facebook experience is broken for me. It broke somewhere in between the Dunbar number (150 friends) and my current number (3,000 friends). I wanted a way to keep in touch with people I love, and to share things that are important to me with those people. But “at scale”, Facebook actually stops working. Flooding the system did not break the technology, but it broke the experience.
Scalable should be defined in different terms, then. If a startup is “Scalable”, as I see it, the optimal user experience is the “at scale” experience. Well-designed cities are scalable. When they achieve maximum density, the services rendered work great - you can walk and bike to places, you can interact with a diverse set of people, and have a wide range of activities available to you. Your immediate radius becomes a hub of intellectual and creative capacity. A dense city optimizes the experience. A dense Facebook, however, breaks the experience. Scalable, in this sense, not only means that the system can grow fast without breaking, but that a system will work well, and even better, once it’s grown.
Marketplaces tend to be more naturally scalable, by this definition. At scale, the buyers and the sellers both get happier as there are more of the other, and there is a virtuous cycle that drives growth at liquidity. Getting to scale requires delicate knob-twisting of supply and demand AND user momentum. It’s a labor of love, and it requires a clear and constant feedback loop between the product designers and the users. Entrepreneurs and investors both tend to focus much more on the momentum aspect of scalability: can it GROW. This makes sense, but is incomplete. To create lasting businesses, equal attention must be paid to the question of what happens if it grows?
Why The World Bank Really Sucks. (IMF, too.)
I enjoyed this Foreign Policy Magazine piece offering a contrarian perspective on Africa’s growth over the last 10 decades. It describes TIME magazine and The Economist’s cover story articles about Africa’s precipitous rise. As author Rick Rowden says of these magazines,
They looked to Africa’s recent high GDP growth rates, rising per capita incomes, and the explosive growth of mobile phones and mobile phone banking as evidence that Africa is “developing.” Rich countries figured out long ago, if economies are not moving out of dead-end activities that only provide diminishing returns over time (primary agriculture and extractive activites such as mining, logging, and fisheries) and into activities that provide increasing returns over time (manufacturing and services), then you can’t really say they are developing.
Indeed, simple free-trade isn’t sufficient criteria for real, sustained growth. Mining and agriculture alone will slow down, once you’ve reached peak levels of your natural resources. Industrialization, which is the sustainable and effective way to become a rich country, requires protectionism, speculative investment (from governments AND from private investors, as Bill Janeway eloquently describes in this fantastic book), and especially creating a knowledge worker class who can produce competitive advanced goods to sell in an export economy and as price-protected services to their population.
Now, imagine if the entire continent of Africa were to invest in huge domestic stimuli the way China has, and use currency protections and price-fixing to artificially manufacture the ideal high-growth conditions that would fast-track the continent to industrialization. The global iron, diamond, oil, gold industries would be thrown into the type of chaos that we saw with the OPEC crisis of 1973. Ghana, Angola, Chad, Botswana, Nigeria, and DRC would suddenly be globally influential because of their control of their own spigots of valuable resources**. Their education systems, manufacturing industries, and entreprneurial communities would explode. But, of course, the World Bank would never allow such.
The World Bank, after all, is the very same organization that was constituted to rebuild Europe after World War II. A Europe that was, mind you, made up of England, France, but also their two dozen African colonies. While the organization’s mission, goals, and processes have evolved, it is still an organization whose function is to keep the global economy stable, and is overwhelmingly funded by the United States and other rich western countries. Under these circumstances, the global economy is stable if developing countries don’t grow too fast (inflation), or take on debt that they might not be able to repay (sound familiar?). These developing countries are strictly discouraged from expensive national stimulus programs, no matter what their domestic needs are. In so many cases, their ministers of finance are educated in the US, the UK, or France, and have done a stint of their formative years at the World Bank. The World Bank gives low-interest (and sometimes zero-interest) loans to developing countries, ostensibly to raise them up. But really, it just keeps them down. And it’s unfair.
**The counterargument that political stability or open democracy, is the far bigger obstacle facing Africa’s permanent rise is interesting, but I think tangential. The Middle East is an interesting case-study there.
I can’t deal today.
Within 10 minutes of stepping onto the streets of SOMA, a young bearded man who couldn’t have been older than 35 started trailing me, screaming “you black fuck! Turn around. I’m talking to you, dirty nigger.” I turned to face him, and said, “I’d prefer you say that to my face, like a man,” at which point he did say it to my face like a man. If there wasn’t a security guard at the corner, I don’t even know. And then I walk into a coffee shop, where a dozen comfortably dressed white people are politely, quietly sipping their coffee, talking about valuations and haircuts. Of course, the other black man in there was old, bearded, and very homeless. He zeroed in on me, bee-lined it over, and began to tug at my jacket insistently. I took off my headphones, and he was asking aggressively, insistently, noisily, for some money. I asked him to step outside, and gave him a few bucks. I asked him to be polite, and not bother people inside stores, because that’s how people get arrested. I walked back in to a disapproving half-shake from the barista, a room of studiously avoiding gazes, and hip-hop quietly playing over the sound system. And, of course, when I sit down with my espresso and pull out my Karma* to hop online, two people recognize me from tech, and we proceed to geek out over sharing mobile data, and how much better all this exciting collaboration software will make the world.
*Where we are an investor.
Working on the right problems.
I loved this New York Times article about the “busy” problem.
If you live in America in the 21st century you’ve probably had to listen to a lot of people tell you how busy they are. It’s become the default response when you ask anyone how they’re doing: “Busy!” “So busy.” “Crazy busy.” It is, pretty obviously, a boast disguised as a complaint. And the stock response is a kind of congratulation: “That’s a good problem to have,” or “Better than the opposite”
As I step into the New Year, I’m eager to be mindful of its conclusions, and to draw a few of my own. I was crazy busy last year, especially in the second half of the year. I was working on a few problems that were personally interesting to me, and meeting with start-up companies constantly. I had pitch meetings, casual meetings, phone appointments, to-do lists way too long, and was always doing five things at once. I got enough done, but there were a lot of hanging chads, and it was frustrating.
In designing software, developers will tell you that one of the most important and fundamental truths of programming is to design a program that gets from A to B most efficiently. Knowing when to use a stack, push, or pop method for a list of items is the difference between having to unload/reload the list each time in a loop and just getting the object you need right when you need it. Understanding the power of recursion instead of a regular iterative loop can save you memory, complication, and (crucially) lines of code. Efficiency is elegance.
Developers will also tell you that they need blocks of time to write code, and that it’s not always, or necessarily, 9-5. They know to abhor useless meetings, and they instinctively put a high premium on the power of concentration. We should apply that instinct to everything that we do. Back in the days of One Block Off the Grid and Virgance, our Chairman Steve used to speak a lot about how the hard part of work was knowing which problem to work on. Too often we’re working hard, but not on the right problems. Goodbye to all that. I hope to do less this year, because I want to do more. I have separated my work and personal email, taken email entirely off my phone, and will try and spend at least a half day, if not a full day, a week off the internet entirely to focus on writing, reading, and creative thinking. I’m working on much fewer projects (more on that later), and staying patient and purposeful with my work.
The times in my life when I’ve committed to single-tasking are the ones when I’ve been the most productive, the healthiest, and the most in-tune with my goals. Single-tasking requires the space for reflection, so that we can arrange our priorities and our skills against the insane amount of information we take in every day. So I’ll be taking more time this year. Join me!
As the year draws to a close, it’s time for resolutions and reflections. Mine has to do with service. These questions about service have been hanging over me a lot this year, and I would like to share some of my explorations on this forum.**
What does it mean to serve?
“To help those in need.”
That sounds good, right? It seems to encompass volunteering and economic development and political activism, all usually associated with service. But if I’m a relatively poor young person helping a rich old man with his taxes, is that service? What if I’m a depressed and lonely person volunteering at a soup kitchen, serving a close, loving, homeless family? Which of us is in need, there? Who is doing the serving, and who is being served? In obvious ways, we are all in need. So is service then all thoughtful interactions between two people? That feels too big, too easy.
Some of my more morally attentive friends define service in terms of motivations. They find themselves discomfited when community service is only done for college applications; when community members publicly tithe to keep up with the Joneses; when peers visit South Asian orphanages to make themselves feel good (and look good on Instagram); when colleagues ask for charity:water donations for their birthday, to increase their Twitter following. According to the logic, if volunteering and development and activism make me feel good about myself, primarily, there is surely some twisted lack of regard for those in need. They suggest that service should have a certain motivational characteristic - one of proper altruism - for it to be the ‘right’ kind of service. Assuming altruism is possible, is selfless motivation the only circumstance for service? Is wanting to feel good about myself on Christmas the wrong reason to spend it at a soup kitchen?
The etymology of the word “serve” comes from the Latin servus, which means ‘slave’. A slave is someone who works for no pay, or nothing in return. So perhaps the altruism - expecting nothing in return - is indeed the ‘right’ kind of service. But that feels too hard.
Why do we serve?
Thomas Aquinas, the famous Christian theologian, says we serve (do charity) as a way to spiritual happiness. It is one of the virtues, and it is an act of friendship not between the giver and the recipient, but between the giver and God. Jesus says, after all, that to “love thy neighbor” is, along with “love God”, the greatest of the commandments. The third pillar of Islam, zakat, proclaims mandatory almsgiving, or charity, and is well-documented in the Koran, and other hadith law. Maimonides, the famous medieval Torah scholar, describes tzedakah as a necessary religious obligation for faithful Jews. Buddhism and Hinduism affirm almsgiving as a way of practicing virtue. As an act of faith, service seems necessarily self-directed. But there’s a problem here. After all, the most morally attentive of us intuitively dismiss selfishly-motivated service. So surely the purpose isn’t just to make oneself better.
Some of the wonkier among my friends and colleagues judge service according to the market. According to them, the sum of transaction-based actions we can take (where I give something in exchange for receiving something equivalent) insufficiently meets the complex and evolving demands of society. In other words: markets are inherently imperfect. Service is what makes up the difference. Service brings us to social equilibrium. This argument works from a few political angles. On the activist left: that’s why we need government and NGO’s. We must pay taxes and support non-profit to help those who can’t help themselves. On the religious right: government-edited markets are imperfect. Give people back their money; encourage them to fill the gaps through local churches (mosques, synagogues, temples, etc). But it’s still massively wide-scope. Paul Ryan and Barack Obama might both agree here, but on none of the implementation.
(I wonder what libertarians think.)
What makes for effective service?
On implementation, how do we measure service?
Consequentialists measure it with math: how many wells built, how many shoes donated, how many dollars loaned (and repaid), how much world food redistributed. This is supremely hard. First, macroeconomics is impossibly abtruse. Unified theory about how to improve people’s lives at scale is like string theory. It must exist, but god knows how we’ll find it. I’ve heard eloquent arguments about TOMS shoes fucking up local economies by overwhelming the supply and pricing out local shoemakers. I’ve heard elegant concerns about the World Bank holding back emerging market development, because the stipulations around low-income loans preclude debt-fueled stimulus in recipient countries. Stiglitz and Sachs can’t both be right, but they both are, in layman’s discourse.
Second, the math is so complex. If I spend an hour at a soup kitchen feeding the homeless, am I making the world better? Would that hour not have been better spent working for affordable housing legislation, so that thousands of homeless could have homes, rather than hundreds of homeless having one meal?
“Bang for you buck” service gets confusing quick.
Others just choose one metric of human achievement, and are zealots in tracking it. If I choose “life expectancy”, then surely I’m winning, right? And what about GDP per capita? It’s a fact that the world is getting healthier, so the world is getting better, right? People who think this way can rationalize pretty much any economic action as a public good. I’m not one of these people.
And if I’m not a consequentialist, then is Aquinas right? Is service most effective when it makes us all holy? I’m into that, in theory. But in practice, humility seems harder to grasp when I’m only trying to ready myself for Heaven. Is service most effective when we are all just helpful with no expectation of reward? That sounds pretty good, but pretty damn idealistic.
So what am I?
Gosh, I dunno. It’s complicated: I am at any moment all of these things. But, I admit, I am too often none of these things. My resolution is the same as it was last year, and probably will be next year: to serve more.
What about you?
**Martha Muña, Alex Magnin, Tania Mitchell, Tom Dougherty, Robert Reich, Will Kymlicka, Immanuel Kant, and John Stuart Mill all deserve thanks for keeping this top of mind for me this year.