The stories of disruptive tech startups that have rocketed from a standing start to global domination and multi-billion dollar valuations are now legion. We're all familiar with the fact that YouTube went from a credit-card funded start-up to a $1.4bn sale to Google in no time or that Uber grew from an idea to a $51bn valuation in about five minutes.
Whether or not we know the details (18 months and five years, respectively) these stories of global tech disruption hardly surprise us anymore. It's part of what Salim Ismael, former head of innovation at Yahoo and a key part of the team running Singularity University, describes as the “accelerating metabolism of the economy”.
This boost to the global metabolism is being driven by scientific and technological advances which in turn are being harnessed by the founders of what Ismael has dubbed Exponential Organisations (ExOs). To qualify as an ExO a company has to be able to grow at lightning speed, but also has to have an impact way beyond its size.
In his 2014 book Exponential Organizations: Why new organizations are ten times better, faster, and cheaper than yours (and what to do about it) Ismael described it like this: “An ExO is one whose impact (or output) is disproportionately large – at least 10x larger – compared to its peers, because if the use of new organisational techniques that leverage accelerating technologies.”
He points to the fact that underlying this turbo-charged tech sector is the fact that Moores Law, a term initially coined by Intel co-founder Gordon Moore to describe how microprocessor power doubled every two years, now applies as a general law across all technology. As this general Law of Accelerating Returns (LOAR) occurs in almost every sector, it's not surprising that disruptive ExOs are also emerging to disrupt all sectors of the economy.
But there is a second part to being an ExO. And in some respects it more impressive and significant than the underlying tech acceleration. To have a genuine and lasting impact, true ExOs have something beyond just the speed at which they scale. They also need to have what Ismael has dubbed "Massive transformational purpose" (MTP) . In other words, they need to be thinking of the impact they can and will have and the positive transformation on society they can bring about. It is way more than a mission statement and has to have more depth than a marketing slogan.
Examples of well known MTPs include Google's stated aim of "organising all the world's information", while Patagonia's MTP is being "in business to save our home planet”. It is refreshing and heartening to think that, at a time when we are not short of systemic challenges to the established world order, the incredible power of technology can be combined with the dedication, innovation and creativity of the founder community to effect genuine and lasting social change.
Whether it is harnessing AI and big data, health tech and biohacking, climate friendly computing or a combination of all these and more, its clear that by putting transformational purpose at the heart of these future global giants, they will be able to achieve more than just multi-billion dollar valuations. It's great that there has been such widespread recognition that there is more to an ExO than just achieving a mega valuation in lightning quick time. Here's hoping the folks writing the cheques are paying attention.