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Seven Ways to Spot the Next Big Thing

Thirty years ago, when John Naisbitt was writing Megatrends, his prescient vision of America’s future, he used a simple yet powerful tool to spot new ideas that were bubbling in the zeitgeist: the newspaper. He didn’t just read it, though. He took out a ruler and measured it. The more column inches a particular topic earned over time, the more likely it represented an emerging trend.

“The collective news hole,” Naisbitt wrote, “becomes a mechanical representation of society sorting out its priorities” — and he used that mechanism to predict the information society, globalism, decentralization, and the rise of networks. As clever as Naisbitt’s method was, it would never work today. There’s an infinite amount of ink and pixels spilled on most any topic.

These days, spotting the future requires a different set of tools. That’s why at Wired, where we constantly endeavor to pinpoint the inventions and trends that will define the future, we have developed our own set of rules. They allow us to size up ideas and separate the truly world-changing from the merely interesting. After 20 years of watching how technology creates a bold and better tomorrow, we have seen some common themes emerge, patterns that have fostered the most profound innovations of our age.

This may sound like a paradox. Surely technology always promises something radically new, wholly unexpected, and unlike anything anybody has seen before. But in fact even when a product or service breaks new ground, it’s usually following a familiar trajectory. After all, the factors governing thermodynamics, economics, and human interaction don’t change that much. And they provide an intellectual platform that has allowed technology to succeed on a massive scale, to organize, to accelerate, to connect.

So how do we spot the future — and how might you? The seven rules that follow are not a bad place to start. They are the principles that underlie many of our contemporary innovations. Odds are that any story in our pages, any idea we deem potentially transformative, any trend we think has legs, draws on one or more of these core principles. They have played a major part in creating the world we see today. And they’ll be the forces behind the world we’ll be living in tomorrow.

1. Look for Cross-Pollinators

1. Look for cross-pollinators.

It’s no secret that the best ideas — the ones with the most impact and longevity — are transferable; an innovation in one industry can be exported to transform another. But even more resonant are those ideas that are cross-disciplinary not just in their application but in their origin.

Man with wings
Mike Timo | Photographer's Choice | Getty Images
Man with wings

This notion goes way back. When the mathematician John von Neumann applied mathematics to human strategy, he created game theory — and when he crossed physics and engineering, he helped hatch both the Manhattan Project and computer science. His contemporary Buckminster Fuller drew freely from engineering, economics, and biology to tackle problems in transportation, architecture, and urban design.

Sometimes the cross-pollination is potent enough to create entirely new disciplines. This is what happened when Daniel Kahneman and Amos Tversky started to fuse psychology and economics in the 1970s. They were trying to understand why people didn’t behave rationally, despite the assumption by economists that they would do so. It was a question that economists had failed to answer for decades, but by cross-breeding economics with their own training as psychologists, Kahneman and Tversky were able to shed light on what motivates people. The field they created —behavioral economics — is still growing today, informing everything from US economic policy to the produce displays at Whole Foods .

More recently, the commonalities between biology and digital technology — code is code, after all — have inspired a new generation to reach across specialties and create a range of new cross-bred disciplines: bioinformatics, computational genomics, synthetic biology, systems biology. All these fields view biology as a technology that can be manipulated and industrialized. As Rob Carlson, founder of Biodesic and a pioneer in this arena, puts it, “The technology we use to manipulate biological systems is now experiencing the same rapid improvement that has produced today’s computers, cars, and airplanes.” These similarities and common toolsets can accelerate the pace of innovation.

The same goes for old industries, as well. The vitality we see in today’s car industry resulted from the recognition that auto manufacturing isn’t a singular industry siloed in Detroit. In the past decade, car companies have gone from occasionally dispatching ambassadors to Silicon Valley to opening lab space there—and eagerly incorporating ideas from information technology and robotics into their products. When Ford CEO Alan Mulally talks about cars as the “all-time mobile application,” he’s not speaking figuratively — he’s trying to reframe the identity of his company and the industry. That’s testimony to a wave of cross-pollination that will blur the line between personal electronics and automobiles.

The point here is that by drawing on threads from several areas, interdisciplinary pioneers can weave together a stronger, more robust notion that exceeds the bounds of any one field. (One caveat: Real cross-pollination is literal, not metaphorical. Be wary of flimflam futurists who spin analogies and draw equivalences without actually identifying common structures and complementary systems).

2: Surf the exponentials.

2. Surf the exponentials.

Some trends are so constant, they verge on cliché. Just mentioning Moore’s law can cause eyes to roll, but that overfamiliarity doesn’t make Gordon Moore’s 1965 insight — that chips will steadily, exponentially get smaller, cheaper, faster — any less remarkable.

Fitbit
Source: fitbit.com
Fitbit

Not only has it been the engine of the information age, it has also given us good reason to believe in our capacity to invent our future, not just submit to it. After all, Moore’s law doesn’t know which silicon innovation will take us to the next level. It just says that if the previous 50 years are any indication, something will come along. And so far, it always has.

Moore’s law has been joined by — and has itself propelled — exponential progress in other technologies: in networks, sensors, and data storage (the first iPod, in 2001, offered 5 gigabytes for $399, while today’s “classic” model offers 160 gigs for $249, a 51-fold improvement). Each of these cyclically improving technologies creates the opportunity to “surf exponentials,” in the words of synthetic biologist Drew Endy — to catch the wave of smaller, cheaper, and faster and to channel that steady improvement into business plans and research agendas.

This was the great insight that inspired YouTube, when cofounder Jawed Karim realized (while reading Wired, it so happens) that broadband was becoming so cheap and ubiquitous that it was on the verge of disrupting how people watched videos. And it’s what Dropbox did with digital storage. As the cost of disc space was dropping at an exponential rate, Dropbox provided a service capitalizing on that phenomenon, offering to store people’s data in the cloud, gratis. In 2007 the two free gigabytes the company offered were really worth something. These days 2 gigs is a pittance, but it remains enough of a lure that people are still signing up in droves—some fraction of whom then upgrade to the paid service and more storage.

And it’s what allowed Fitbit to outdo Nike+. As accelerometers dropped in cost and size, Fitbit could use them to measure not just jogging, but any activity where movement matters, from walking to sleep. For all its marketing muscle, Nike didn’t recognize that accelerometers were the dynamo of a personal health revolution. The new FuelBand shows that the company has now caught on, but Fitbit recognized the bigger trend first.

Exponentials, it turns out, are everywhere. Just choose one, look where it leads, and take a ride.

3. Favor the liberators

3. Favor the liberators.

Liberation comes in two flavors. First are those who recognize an artificial scarcity and move to eliminate it by creating access to goods. See the MP3 revolutionaries who untethered music from the CD, or the BitTorrent anti-tyrannists who created real video-on-demand.

Source: Apple

Sometimes, of course, the revolution takes longer than expected. Back in 1993, George Gilder pointed out in these pages that the cost of bandwidth was plummeting so fast as to be imminently free. Gilder’s vision has been proven correct, paving the way for Netflix and Hulu. And yet telcos are today—still!—trying to throttle bandwidth. But this is just biding time on the scaffold. In the words of investor Fred Wilson, “scarcity is a sh**** business model.”

The second flavor of liberation takes a more subtle approach to turning scarcity into plenty. These liberators use the advent of powerful software to put fallow infrastructure to work. Think of how Netflix piggybacked on a national distribution infrastructure by having the US Postal Service carry its red envelopes. Or how the founders of Airbnb recognized our homes as a massive stock of underutilized beds, ready to be put into the lodging market. Or how Uber turns idling drivers into on-call icons on a Google map, blipping their way to you in mere minutes.

Reid Hoffman, the philosopher-investor, describes these companies as bringing liquidity to locked-up assets. He means this in the financial sense of “liquidity,” the ability to turn capital into currency, but it also works in a more evocative sense. These companies turn static into flow, bringing motion where there was obstruction.

What’s it like to live in the future? Ask an Uber driver — these guys are electrons pulsing through a real-life network, and they’re delighted by it. So should we all be.

4. Give points for audacity.

4. Give points for audacity.

When “big hairy audacious goal” entered the lexicon in 1994 (courtesy of Built to Last, the management tome by James Collins and Jerry Porras), it applied to ambitious executives eager to set high targets for annual revenue growth and increased market share. Yawn. But the term — shortened to BHAG — also coincided with the birth of the web, when innovators began to posit a whole new sort of audacity: to make every book, in every language, available in less than a minute; to organize all the world’s information; or to make financial transactions frictionless and transparent.

Audacity is easily written off as naïveté, as overshooting your resources or talents. And that’s a danger. Plenty of would-be Napoleons have called for revolutions that never found an army. But you can’t make the future without imagining what it might look like.

Too much of the technology world is trying to build clever solutions to picayune problems. Better parking apps or restaurant finders might appeal to venture capitalists looking for a niche, but they are not ideas that seed revolutions. Instead, take a lesson from Tesla Motors , which had the pluck to spend $42 million of its precious capital to buy a factory roughly the size of the Pentagon, stock it with state-of-the-art robots, and begin making wholly viable electric cars. Or look to Square, which has pronounced the cash register a counter-cluttering vestige of the 19th century and created an alternative that will not only make buying things easier but will deliver retailers from their sclerotic relationship with credit card companies.

These times especially call for more than mere incrementalism. Let’s demand that our leaders get in over their heads, that they remain a little bit naive about what they’re getting into. As venture capitalist Peter Thiel told wired two years ago, “Am I right and early, or am I just wrong? You always have to wonder.” This kind of willingness to take a chance and be early is what keeps the world moving.

5. Bank on openness.

5. Bank on openness.

In 1997 Wired’s founding executive editor, Kevin Kelly, wrote a story called “New Rules for the New Economy” (it was in many ways the inspiration for this very piece). His focus was on networks, the “thickening web” that was forging connections of catalytic power.

Twitter
Twitter

Many of his radical rules have become commonalities today, but two of them are just coming into their own: Connected individuals with shared interests and goals, he argued, create “virtuous circles” that can produce remarkable returns for any company that serves their needs. And organizations that “let go at the top” — forsaking proprietary claims and avoiding hierarchy —will be agile, flexible, and poised to leap from opportunity to opportunity, sacrificing short-term payoffs for long-term prosperity. Since Kelly wrote his piece, these forces have flourished. Back then open source software was a programming kibbutz, good for creating a hippy-dippy operating system but nothing that could rival the work of Oracle or Microsoft . Today open source is the default choice for corporations from IBM to Google . Even Microsoft is on board, evangelizing Hadoop and Python and opening the Xbox Kinect controller so it can be a platform for artists and roboticists. Supported by coder clubhouses like SourceForge and GitHub, collaborative circles can emerge with stunning spontaneity, responding elastically to any programming need.

More tellingly, in many organizations openness itself has become a philosophical necessity, the catalyst that turns one employee’s lark into a billion-dollar business. Companies from Lego to Twitter have created a product and then called on its users to chart its course, allowing virtuous circles to multiply and flourish. Time after time, the open option has prevailed, as Zipcar has gained on Hertz and users have upvoted Reddit over Digg.

The best example may be nearly invisible, even to a dedicated user of the Internet: blogging platforms. Less than a decade ago there were a multitude of services competing for the emerging legion of bloggers: Movable Type, TypePad, Blogger, WordPress. Today, only the last two remain relevant, and of these, the small, scrappy WordPress is the champ. WordPress prevailed for several reasons. For one, it was free and fantastically easy to install, allowing an aspiring blogger (or blogging company) to get off the ground in hours. Users who wanted a more robust design or additional features could turn to a community of fellow users who had created tools to meet their own needs. And that community didn’t just use WordPress — many made money on it by selling their designs and plug-ins. Their investment of time and resources emboldened others, and soon the WordPress community was stronger than any top-down business model forged inside the walls of their competition.

Sure, there are Apples and Facebooks that thrive under the old rules of walled gardens and monocultures. But even they try to tap into openness (albeit on their own terms) by luring developers to the App Store and the Open Graph. And for all the closed-world success of these companies, the world at large is moving the other way: toward transparency, collaboration, and bottom-up innovation. True openness requires trust, and that’s not available as a plug-in. When transparency is just a marketing slogan, people can see right through it.

6. Demand deep design.

6. Demand deep design.

Too often in technology, design is applied like a veneer after the hard work is done. That approach ignores how essential design is in our lives. Our lives are beset by clutter, not just of physical goods but of ideas and options and instructions — and design, at its best, lets us prioritize. Think of a supremely honed technology: the book. It elegantly organizes information, delivering it in a compact form, easily scanned asynchronously or in one sitting. The ebook is a worthy attempt to reverse-engineer these qualities — a process that has taken decades and chewed up millions in capital. But still, despite the ingenuity and functionality of the Kindle and the Nook, they don’t entirely capture the charms of the original technology. Good design is hard.

Amazon’s Kindle Fire
Amazon’s Kindle Fire

Indeed, good design is much, much harder than it looks. When Target redesigned its prescription pill bottle in 2005, the improvement was instantly recognizable — an easy-to-read label that plainly explains what the pill is and when to take it. It was a why-didn’t-I-think-of-it innovation that begged to be replicated elsewhere. But judging by the profusion of products and labels that continue to baffle consumers, it has been largely ignored. Same with Apple : The company’s design imperative is forever cited as intrinsic to its success, but Apple still stands curiously alone as a company where engineers integrate design into the bones of its products.

Thankfully, we are on the verge of a golden age of design, where the necessary tools and skills — once such limited resources — are becoming automated and available to all of us. This timing is critical. “Too much information” has become the chorus of complaint from all quarters, and the cure is not more design but deeper design, design that filters complexity into accessible units of comprehension and utility. Forget Apple’s overpraised hardware aesthetic; its greatest contribution to industrial design was to recognize that nobody reads user’s manuals. So it pretty much eliminated them. You can build as many stunning features into a product as you like; without a design that makes them easy to use, they may as well be Easter eggs.

No company has managed this better than Facebook, which outstripped MySpace because it offered constraint over chaos and rigor over randomness. Facebook has tweaked its interface half a dozen times over the years, but it has never lost the essential functionality that users expect. Indeed, its redesigns have been consistently purposeful.

Each time, the company’s goal has been to nudge users to share a little more information, to connect a little more deeply. And so every change has offered tools for users to better manage their information, making it easier to share, organize, and access the detritus of our lives. Privacy concerns aside, Facebook has helped people bring design into their lives as never before, letting us curate our friends, categorize our family photos, and bring (at least the appearance of) continuity to our personal histories. Services like Pinterest only make this more explicit. They promise to let us organize our interests and inspirations into a clear, elegant form. They turn us into designers and our daily experience into a lifelong project of curation. This is deep design commoditized — the expertise of IDEO without the pricey consulting contract. And done right, it is irresistible.

7. Spend time with time wasters.

7. Spend time with time wasters.

The classic business plan imposes efficiency on an inefficient market. Where there is waste, there is opportunity. Dispatch the engineers, route around the problem, and boom —opportunity seized.

That’s a great way to make money, but it’s not necessarily a way to find the future. A better signal, perhaps, is to look at where people — individuals — are being consciously, deliberately, enthusiastically inefficient. In other words, where are they spending their precious time doing something that they don’t have to do? Where are they fiddling with tools, coining new lingo, swapping new techniques? That’s where culture is created. The classic example, of course, is the Homebrew Computer Club — the group of Silicon Valley hobbyists who traded circuits and advice in the 1970s, long before the actual utility of personal computers was evident. Out of this hacker collective grew the first portable PC and, most famously, Apple itself.

This same phenomenon — people playing — has spurred various industries, from videogames (thank you, game modders) to the social web (thank you, oversharers). Today, inspired dissipation is everywhere. The maker movement is merging bits with atoms, combining new tools (3-D printing) with old ones (soldering irons). The DIY bio crowd is using off-the-shelf techniques and bargain-basement lab equipment, along with a dose of PhD know-how, to put biology into garage lab experiments. And the Quantified Self movement is no longer just Bay Area self-tracking geeks. It has exploded into a worldwide phenomenon, as millions of people turn their daily lives into measurable experiments.

The phenomenon of hackathons, meanwhile, converts free time into a development platform. Hackathons harness the natural enthusiasm of code junkies, aim it at a target, and create a partylike competition atmosphere to make innovation fun. (And increasingly hackathons are drawing folks other than coders.) No doubt there will be more such eruptions of excitement, as the tools become easier, cheaper, and more available.

These rules don’t create the future, and they don’t guarantee success for those who use them. But they do give us a glimpse around the corner, a way to recognize that in this idea or that person, there might be something big.

Tomas Goetz is the Executive Editor of WIRED where he oversees everything from story conception to cover packages for the magazine. He is also the author of The Decision Tree: A Manifesto for Personal Health.

Follow Thomas Goetz on Twitter: @tgoetz