• February 14, 2017

Access to Innovation: The Value of a Great Idea Done Right

Ideas and talent fueled by speed pave the new road to riches.

Microsoft founder Bill Gates made his first million in 1978 at the age of 23. In 1987, at 32he became the youngest billionaire ever at the time. (Since then, Facebook founder Mark Zuckerberg has blown Gates’ record out of the water, entering the self-made billionaire ranks in 2008 at the age of 23).

But Gates didn’t establish a massively valuable global enterprise and earn personal wealth by amassing capital to produce and distribute things. He didn’t trade in complex manufactured machines, petroleum products, or precious metals. After all, the code-laden floppy disks Microsoft originally distributed were worth only a few pennies each. No, Gates got rich and powerful by producing and selling valuable ideas—thoughts expressed in magnetized iron oxide particles on disks of Mylar film.

From Capital and Things to Ideas and Thoughts

For more than a century and a half, the developed world has lived and thrived in the Industrial Revolution economy. It was founded on a system of exchange, where people traded their time and skills for monetary compensation to produce products or services for a company. Wealth and economic might was built on capital, materials, and labor. It was an economy of materialism.

But we’re entering a golden age—not of industrial or consumer products and services, but of ideas. Every month, we’re seeing advances in artificial intelligence, automation, robotics, apps, and data mining. As these surges of breakthrough innovation sift through the economy and social order over the next couple of decades, the disruptive effects will be stunning.

Today, capital and savings are not the big constraints on economic growth. Complex—once prohibitively expensive—processes, such as marketing, mass communication, data processing and storage, and sophisticated media content, are within reach of almost anyone. A dearth of great ideas is the real constraint on today’s economic vibrancy. And yet turning an idea into a new product or service has never been easier.

Constraints Aside 

Still, in this environment good ideas are not enough. Success depends on turning ideas into value faster than your competition.

Today, the tools that enable disruption—mobility, cloud computing, data analytics, and connected sensors—are affordable and easily accessible. They have given rise to a new class of thought leaders and entrepreneurs. They are revolutionizing entire industries—from Uber and Airbnb in taxi and lodging services to Amazon and Netflix in retail and feature-film and television content. These idea-driven enterprises can only thrive if they can merge vision and ideation prowess with technological agility that’s calibrated to rapidly respond to market opportunities and business threats.

But even good ideas face formidable constraints. The costs of gyroscopes—the critical component in drones—plunged as they were transformed and integrated into smartphones. Yet current FAA regulations keep this innovation from actualizing its latent commercial value. Many recently minted enterprise marvels—Apple, Google, Amazon, Facebook—are built on an amalgam of technologies that are difficult to replicate. Digital companies fuel success by establishing platforms assembled with proprietary algorithms and a broad set of networked users that add even more value.

It’s more ideas and better ideas—not necessarily capital and materials—that will confront and surmount these constraints. Think of ideas as the ore of possibility. Hundreds of idea products are being produced and thousands more are purchased every single day. Those that can turn this ore into value faster will prosper. And they’ll drive the idea economy.

Like this article? Read more on the idea economy and security.