If you are here, you have some doubts about my statement on how our consciences can affect reality, suggested by Quantum Physics. Here is the video to intro it if you are unfamiliar:
From my own research, many traditional physicists mocks the concept of consciousness affecting the world of physics. Even the popular Astrophysicist Neil deGrasse Tyson dismisses this concept and makes fun of it. However, many Quantum Physicist now believe in this concept of consciousness affecting the physical world based on the evidence from experiments.
Now, there are two type of doubters – lazy ones and diligent ones. Lazy is not a bad thing, but just means you doubt but you don’t want to spend a lot of time investigating. Diligent ones want to investigate a lot. I’ve made some argument sessions on both:
Here I offer some higher level items, mostly in the form of social proof. This shows the credibility of people who believe in this consciousness concept. This is not “widely accepted” or “proven” in any way, but it is a legitimate theory that accomplishing scientists support.
“When the province of physical theory was extended to encompass microscopic phenomena through the creation of quantum mechanics, the concept of consciousness came to the fore again. It was not possible to formulate the laws of quantum mechanics in a fully consistent way without reference to the consciousness.“
―Eugene Wigner, Nobel Prize Winner and leading Physicist of the Twentieth Century
“Science cannot solve the ultimate mystery of nature. And that is because, in the last analysis, we ourselves are a part of the mystery that we are trying to solve.”
― Max Planck, Also Nobel Prize Winner
“I regard consciousness as fundamental. I regard matter as derivative from consciousness. We cannot get behind consciousness. Everything that we talk about, everything that we regard as existing, postulates consciousness.”
― Also Max Planck
“It turns out that, just as Bohr confidently predicted, it makes no difference whether we delay the measurement or not. As long as we measure the photon’s path before its arrival at a detector is finally registered, we lose all interference. It is as if nature “knows” not just if we are looking, but if we are planning to look.”
“Beginning in the 1980s, the British physicist Roger Penrose suggested that the link might work in the other direction. Whether or not consciousness can affect quantum mechanics, he said, perhaps quantum mechanics is involved in consciousness.”
This is Roger Penrose’s Credentials:
“Penrose is known for his work in mathematical physics, in particular for his contributions to general relativity and cosmology. He has received several prizes and awards, including the 1988 Wolf Prize for physics, which he shared with Stephen Hawking for the Penrose–Hawking singularity theorems”
Adrien Kent has this quote: “We could make some progress on understanding the problem of the evolution of consciousness if we supposed that consciousnesses alters (albeit perhaps very slightly and subtly) quantum probabilities.” BBC adds, “In other words, the mind could genuinely affect the outcomes of measurements.”
Adrien Kent’s credentials are: Professor of Quantum Physics, DAMTP, University of Cambridge
Distinguished Visiting Research Chair at Perimeter Institute for Theoretical Physics in Waterloo, Ontario
Fellow of Wolfson College, Cambridge
Director of Studies in Mathematics at Darwin College, Cambridge
Affiliate at the Institute for Quantum Computing, University of Waterloo, Ontario
Visiting Scholar at Wolfson College, Oxford”
For those who are more serious doubters, here is some backup science to investigate into.
Delayed Choice Quantum Eraser Experiment
The best and most convincing is the Delayed Choice Quantum Eraser Experiment. The video below is the second part of the video posted above (this here is the original), but is a video to make sure to watch.
The 3 min 6s mark is a good place to start. I didn’t fully understand the experiment from a bunch of other videos, but this one I finally understood it in roughly 5 minutes. This explains how the human mind is what determines the results, not the measuring device.
Tom Campbell Workshop
This is a LONG workshop by Thomas W. Campbell explaining the experiments. His conclusion: “There is no objective reality.”
You can probably start at the 44 min mark if you don’t want to watch the whole thing. Below is his bio:
“Campbell has had a long career as a scientist and physicist. He received a B.S. in Physics as well as an M.S. in Physics. His Ph.D. work specialized in Experimental Nuclear Physics with a thesis in low-energy nuclear collisions. Subsequently, he spent the better part of 30 years working within the U.S. missile defense community as a contractor to the Department of Defense. Campbell most recently worked for NASA within the Ares I program (follow-on to the Shuttle) assessing and solving problems of risk and vulnerability to insure mission and crew survivability and success.”
Some people doubt his credibility, but I dug deeper into Thomas Campbell’s background as people said his background isn’t verifiable and he just made it up.
I finally found his credentials on the NASA website: https://ntrs.nasa.gov/search.jsp?R=20090014192
In the PDF that is attached there, it does verify that, “THOMAS W. CAMPBELL is currently consulting in the field of Probabilistic Design Analysis for NASA. He has over 36 years of experience working with the Department of Defense in several fields, including systems engineering; technology development; physics based modeling and simulation; algorithm and software development; intelligence analysis; radars, antenna, and electronic environments analysis; system security engineering; technology transfer, reuse, and insertion; engineering management and program management; and system risk and vulnerability. He received a B.S. in Physics as well as an M.S. in Physics. His Ph.D. work specialized in Experimental Nuclear Physics with a thesis in low-energy nuclear collisions.”
Since his work with NASA is assessing and solving problems of risk and vulnerability to insure the Ares shuttle mission and crew survivability and success, I think there needs to be a lot of precision in his work, as opposed to being an idealistic philosopher.
2. If you want to investigate the actual scientific paper, check out this LONG and dense reading:
Back in 2003, I had an epiphany that changed my life. I had just quit playing Diablo II and I felt a rush of emptiness.
I spent thousands of hours becoming strong in a video game, but once I was done with the game, all that disappears. I’m still at the same place in life.
It was then when I went on a life journey to make games more meaningful towards our real lives.
At the time, I had considered two options:
Option 1: do what was considered “Gamification” (in today’s terminology)
Option 2: do what was considered “Esports” (in today’s terminology)
Both of them were relevant in my quest of making real life better through gaming (and ensure that playing games wasn’t a “waste of time.”).
The Non-Existent Esports Industry
Back then the esports industry didn’t exist, besides some serious matches of Starcraft in South Korea.
It was just more of a vision for me where, if videos games could be like a real sport such as Basketball, then there would be a real economy and ecosystem around it (Managers, Players, Coaches, Media etc.), and playing/studying games all day long suddenly became very productive.
It wasn’t unfathomable (despite sounding crazy to everyone I talked to – they thought I was just creating more excuses to play games). “Real Sports” like Basketball and Football are basically just games that people played for fun. But when enough people enjoyed playing and watching the game, it sets up a whole economy of ticket sales, advertisers, staff, dedicated venues, and cultural change.
It becomes “legit” and is no longer “just a game.”
As you probably know, I ended up choosing the Gamification path. As a result, I became a leading pioneer in the gamification space and am running many of the biggest gamification initiatives in the world (consulting company, the education platform Octalysis Prime, FB community). It worked out quite well for me, and I live every day of my life as a passionate gamer. Even Blizzard has sent their game designers to my workshops to learn about the Octalysis Framework.
But I sometimes can’t help but think about the other choice I didn’t make. If I chose to go down the esports path, I would also become an early pioneer in esports and today I may be running some of the largest esports infrastructure entities in the industry (I’m realistic enough to know that I wouldn’t become a pro-player myself). That would be tremendously fun too.
The two passions meet
Luckily, because of how strong my gamification efforts are doing, I suddenly have the unique opportunity to go down the path I didn’t take.
We have now sponsored a team in the Heroes of the Storm Global Championship (HGC), the premier Heroes of the Storm competitive league from Blizzard Entertainment. Our team “Team Octalysis” (formerly Team Twelve) is currently a Top 3 Team in North America.
Team Octalysis has 5 amazingly hard-working players, a great team manager, a coach/game analyst, and media members – all there to support competitive play at the highest levels, engage the fans, and spread a little bit of Octalysis love.
Team Octalysis is officially competing in the HGC, where eight teams in each of four regions compete every week to qualify for international tournaments and a shot at a world championship.
Every weekend, you can tune in on Twitch.tv or the HGC Website to watch their competitions, support Team Octalysis, and muse over obviously-less-talented teams fight each other.
Tesla, Inc. (NASDAQ-TSLA) is the best “Angel Investment Opportunity”
I’ve often asked myself: why am I a Tesla, Inc. (NASDAQ-TSLA) bull, despite unimpressive financials (to say the least), sky-high valuation, and a seemingly unfocused CEO.
If you look at the financials, things aren’t that great. Tesla in general is still losing lots of money (especially if you don’t count occasional Carbon Credit Tax Credit boosts). It still requires a TON more money to expand and operate. For some reason Elon Musk was already working on Giga Factories 3, 4, and 5, when Giga Factory 1 hasn’t even been completed and required more capital. The whole company’s success weighs on Model 3 and Tesla’s ability to suddenly mass produce cars that not even much larger automakers could do. Finally, growing competition in many other well established car brands are coming into the market and stealing Tesla’s pie.
How does it make sense to invest in this company?
Tesla, Inc. (NASDAQ-TSLA) and the Silicon Valley way
After pondering about this question for a while, I realized that the reason why I like Tesla, is that it is almost the most conservative and strongest type of Angel Investment Deal one can find.
In the past, I have made non-trivial money from Startups, and I know how things work in this world (many Venture Capitalists like to refer their portfolio companies to me for my help). When you look at Tesla, Inc as a public company value stock, it may not be that attractive. However, if you still see Tesla as a growth phase startup that requires capital to grow and can take over an entire industry, this is a huge opportunity. As an Angel Investor myself, I couldn’t give up on this opportunity.
In the startup world, when we invest we mostly look at a few things.
Total Addressable Market Size
I will explain in this post how Tesla fits the perfect pattern for all of the above. However, I first want to address one thing.
Tesla, Inc. (NASDAQ-TSLA) does not lose money on every car sale
Many bears like to throw out the statement that “Tesla loses money on every car it sells.”
This is false.
Tesla makes a margin on every car it sells. However, because it is so aggressively setting up new infrastructure and new R&D, it ends up losing money. Let’s say you run a restaurant and invest $10,000 to put iPads on each table. Then say that each food item costs $1 but you can sell it for $11. After selling 900 of this food item, you would have made $9,000 in gross profits. However, since it does not cover the $10,000 investment towards new technology, you post a net loss of $1,000. This does not mean that you lose money on every food item you sell.
Even though the “Tesla loses money on every car it sells” term sounds fancy and catchy for bears, it is entirely inaccurate. If you are a bear for this very reason, I believe the risk you are taking is based on misinformed decision-making and would recommend reconsidering (of course, other reasons could still justify a bear thesis).
With that out of the way, lets cover the fundamentals of startup investing for Tesla.
The Team behind Tesla, Inc. (NASDAQ-TSLA)
OK, so there are a lot of great talent behind Tesla, but for now I’m only going to cover Elon Musk for somewhat obvious reasons. For research on this, I have actually read his whole biography, so I may know more than the average bear about the entrepreneur behind the company.
In startup investing, we look at whether the entrepreneur has successful past “exits” – meaning they made their investors a lot of money. Entrepreneurs who have big exits are hard to come by, and every angel investor wants to jump on that deal when the opportunity becomes present. Even if an entrepreneur has failed 8 times in the past, as long as they have 1-2 successful exits, they are considered gold and a worthy bet.
Now the thing about Elon Musk is that, Elon Musk has NEVER had a failed venture. We all know about his successful endeavors at Paypal (sold to eBay for $1.5 billion) and SpaceX (being the third entity – behind the U.S. and Russian governments – to launch rockets into space at 10% the cost). Tesla itself of course is a successful example.
Critics might unfairly call Tesla a funding-sucking Ponzi scheme, but even if they believe Tesla is overvalued, it definitely HAS value. Tesla makes cars that people want to buy, and these people are willing to pay $100K for these cars. After the purchase, many say their next cars will be Teslas too.
That’s value. It may or may not be a $50 Billion company, but I’m sure everyone will agree it is at least a $1 Billion company. That means, irrefutably, Elon Musk is a successful entrepreneur with Tesla.
Well, every successful entrepreneur must have many little failures before they turn big right? What a lot of people don’t know is that even Elon Musk’s first venture that most people have never heard about about (Zip2) was also sold to Compaq Computer for $307 Million. If any smart-smirky bear wants to call Elon Musk an incompetent executive, first ask themselves if they or someone they know and respect have created companies worth over $300 Million in the past – multiple times.
Well, actually, Elon Musk does have one failed venture. When he was a boy he wanted to start an arcade company in South Africa. But after getting all the prep work done, the venue required an adult to sign the paperwork, and his parents refused to. Perhaps Elon Musk is over his head in optimism after all.
I strongly believe if there was an opportunity to invest in a startup that is run by Elon Musk, every serious and experienced Angel Investor would rush to become part of that deal.
The Traction behind Tesla, Inc. (NASDAQ-TSLA)
The next thing a startup investor looks at is Traction. Traction blinds all eyes. Even if the investor has no idea why someone would use a nose-picking app, as long as you can tell him that you have 5 million active users every month and its growing by 20% each week, he’ll give you money if he believes that can be sustained.
Now, traction does NOT mean profitability. Traction means growth, demand, and product-market fit. It means that if investors put in more money, it will contribute to the business becoming more successful, as opposed to “figuring out how to get the first customer.” Startup Investors actually don’t care about profits much, because all revenue generated should be put back into growth, R&D, and expansion.
Many Venture Capitalists actually call their portfolio companies that are just making decent profits the “walking dead,” because it makes enough money to sustain forever, but it will never grow fast enough to dominate an industry (and lead to an Exit).
If you look at Tesla (and companies like Amazon – NASDAQ: AMZN), they have traction. The Model S was a big success. People not only buy it, they rave about it. It receives huge (or ewwge) reviews. Model X – while having some operational issues due to complexity in vendors – is also a product that people want and are willing to pay for. Model 3 has over 400,000 people putting in $1000 deposits to say they want the car. I think there is no denying that Tesla has traction.
Now the question is whether Tesla can service that demand. Well, let me just say that startup investors LOVE to jump on deals where the demand is too high but they don’t have enough capital to supply the product. The traction is there, and if money can help deliver value to the demand, money is well invested.
The Market of Tesla, Inc. (NASDAQ-TSLA)
So sometimes you would have a great entrepreneur with great traction, but there isn’t a big market anymore, or perhaps it has been “tapped out.” For instance, you could say Twitter (NYSE: TWTR) has a successfully proven CEO, and great traction. However, you could argue that Twitter has already acquired most of its market, and it is unrealistic for it to get another 50% more users. That puts a limit to the stock. Some people believe that Tesla has already tapped out the Electric Vehicle market, but I think that is extremely far from the truth.
We are only at the beginning the EV Market. More and more people are moving toward hybrids and EVs, not necessarily because they care about the planet, but because they like the cars better. Many people like how fast the cars can accelerate. Many people like how quiet it is. Others like the feeling of never needing to go to a gas station as long as they can charge at home (growing startups like Filld (a former client of mine) are there specifically to address this need by sending gas trucks to fuel your car where it is parked). A great amount of EV buyers and Tesla owners say they will buy the same thing again.
This market is only growing at a rapid pace and not shrinking. Even for those who don’t believe in global warming, we know that smog in a city is undesirable. Beijing and Los Angeles are filled with smog and you could barely see the sunrise. Reduced emissions has many appeals that is seen and felt.
The only two barriers to adopting more EV’s are 1) Pricing and 2) Range Anxiety. People often can’t afford the EV’s that can give them over 300 miles per charge (even in the $30,000 range). There is no doubt in my mind the cost and range of EV’s will dramatically decrease in the future years to come, removing those barriers. When those barriers are being slowly lifted, I believe that we currently are not even at 10% the market capacity for EVs in the future world.
Another thing to remember is that Tesla is also not just a car company. It is an ENERGY company. This is why it is not unfathomable that Tesla can grow to become bigger than Ford or GM. Its addressable market includes the car industry, solar panels industry, and energy industry. Here I point out some opportunities in the solar panels and energy industry.
Tesla, Inc. (NASDAQ-TSLA) will dominate in Solar Energy
The Solar City acquisition was questionable to many people. The valuation of it might be high, and the cash situation isn’t that stellar either. However, it is still a dominating player in the solar industry. If you believe a lot more organizations will use solar panels in the future, then is makes sense to bet on the biggest companies in that space. I don’t think many people are “against” solar energy. The only barrier for people to have it is: 1) integration hassles – too lazy to investigate or roof too small 2) cost to implement.
As we know from Behavioral Science (which happens to be what I’m good at), we often don’t want to make big changes to our behavior until we see our neighbors do the same thing. I believe as more and more people get solar panels, it will only create a ripple effect in driving up demand.
However, the key is that the cost and installation process of solar panels would become a lot easier. As Elon Musk said,
It’s looking quite promising that a solar roof will actually cost less than a normal roof before you even take the value of electricity into account. So the basic proposition would be, ‘Would you like a roof that looks better than a normal roof, last twice as long, cost less and by the way generates electricity?’ Why would you get anything else?
Now, there are comments about the “cheaper cost” is compared to more expensive roofs, and not the asphalt ugly ones. Besides the fact that Tesla is addressing wealthier families anyway as his target market, I believe over time, the cost would still become lower and lower, eventually being affordable for more households. Betting on this is betting on minimum linear advancement of the human race. I’m in on that bet.
Every power outage crisis is an opportunity for Tesla, Inc. (NASDAQ-TSLA)
Beyond the car and solar part of Tesla’s business, another huge potential is its energy and battery business. For this industry, the sky is the limit. You may already know that the State of Hawaii has already deployed 272 Tesla power packs and is expected to save them 1.6 million gallons of diesel fuel annually. South Australia had a total black out, and immediately they pursued the opportunity to work with Tesla on providing 24/7 power no matter what the condition.
Do you know what that means? It means that every time there is a power outage, that becomes an opportunity for Tesla (luckily, these “crisis opportunities” don’t have to cost people lives). The weeks prior to this writing, San Francisco and Fremont both had a power outage, causing the BART public transportation system to stop functioning, as well as the traffic lights of the already-hectic San Francisco streets. People are talking about how the government needs to buy Tesla products to make sure this doesn’t happen again. It would be crazy to not see this as a great line of growing business (especially when the buyers are big pocket governments).
Unfortunately and fortunately, Morgan Stanley analyst Adam Jonas said to investors, “At this time, we ascribe zero value to Tesla shares from this business.” To me. this just means untapped upside potentially not factored into the stock.
Competition expands market for Tesla, Inc. (NASDAQ-TSLA)
Another big critique is that the competition will suddenly burst ahead and steal Tesla’s lunch. Many startups as well as large companies like GM, Audi, and Porsche are all launching long range EV’s that people would want to buy. In the startup world, that is actually not a problem, AS LONG AS the company stays innovative AND the market is expanding fast.
As mentioned above, I believe EV is going to become more and more dominant in the future (you can see that the people that first endorsed online shopping are the ones that are first endorsing EV’s – early adaptors of a new trend). Often when you have a “new” market, it takes a lot of time and investment to “educate the market” and generate demand. When the competitors come in, they will also spend considerable (and even more) amount of effort and advertisement to educate the market.
Those critics who used to say, “EV’s will never be picked up by serious car companies and consumers. Tesla will die,” (this was not that long ago) – suddenly are being shut down. Now they are saying, “See, everyone major car manufacturer are doing EV’s. Tesla will die.”
Consumers who are not sure about the viability and attractiveness of EV’s are suddenly seeing respectable companies telling them that it is okay and even good to get EV’s. I believe since the market is so untapped, having competitors come in only expands the market.
This leads to the 2nd point:
Can Tesla continue to innovate in this growing market? My answer is yes. Many of the serious car companies are trying to chase after what Tesla accomplished 5 years ago. Many of them say they will launch a competitive EV by 2020. By then, Tesla would continue to be 5 years ahead, and the competitors would have more copying work to do.
This is common in the startup world. A Startup does something cool, and is ignored by the big companies. After the startup proves to become a “threat,” big old giant company spends 4 months of executive meetings to decide they want to do something similar. And after 2 years, they launch a product that is about 70% as good as the first product they were trying to copy. The 2 years allows the young startup’s lifespan to DOUBLE, becoming way better than what the giants copied. As a result, many large companies buy small startups just to shut them down.
Tesla continues to invest in innovation. This is why it does not turn a profit. It wants to always be 5 steps ahead when others are playing catchup. Other car companies might get a tremendous amount of sales and become very successful. But would this stop the growing market from buying Tesla cars? I don’t think so. I have seen enough of this same pattern to be willing to bet my money on it.
Tesla, Inc. (NASDAQ-TSLA) will require more fundraising, and true investors are willing to fund it
Another big critique on Tesla’s stock is that they continuously need new rounds of capital raising, diluting the stock. In the startup investment world, people who are extremely worried about dilution due to future rounds are often unseasoned.
The very meaning of raising investment money is that a company can take the money and create more value than the amount received. If a company raises $100 because it can generate $1000 in value after, the $100 is a no-brainer.
The only question is, do people believe that the extra capital raised can contribute to more or less value than the received amount? If the capital raising for Tesla is only to do random unproven things that may or may not result in a return, that could be questionable. However, if we know that Tesla has 400,000 deposits and needs to invest in gigafactories to deliver to the demand, or to continuously stay innovative, it is not crazy to believe that the money invested would result in much higher value growth for the company.
But, what about the dilution? It’s great that Tesla is taking new money and becoming more valuable, but I’m being diluted so it must be bad right?
Well, the key is this:
If Tesla raises a lot more capital and you are diluted by 30%, but Tesla is able to take the capital raised and increase the value of the company by 150%, then suddenly the value of your stock actually went up significantly. In the startup world, we know that if you own 10% of a $9 Million company (so $900K in equity), and suddenly it raised another $1 Million, yes your allocation of the company’s equity is diluted by 11%, but you now own 9% of a $10 Million company, which is still $900K in equity.
The simple breakdown is that, if a $9 Million company raises $1 Million, it’s new value is at the minimum $9 Million + the $1 Million cash raised. If the company has an extra $1 Million in the bank, it of course is at least $1 Million more valuable than before. If you believe the $1 Million raised would generate more than $1 Million in value due to clever investments (by an intelligent leader – see above), then each dilution round is actually a gain for your investment.
Tesla, Inc. (NASDAQ-TSLA) investors are motivated by Epic Meaning & Calling
So I am known for my work in gamification and behavioral design. Among the 8 Core Drives of my creation the Octalysis Framework, there is a motivation driver called Epic Meaning & Calling.
This means that people are taking an action because they feel like they are part of something bigger than themselves. When people are driven by Epic Meaning & Calling, they tend to commit seemingly irrational behaviors, often asking how can they become self-sacrificial to fulfill the bigger vision.
While I am a Tesla Bull, there are times where I increase my ownership if I know the consumer market will push it up more, and I get rid of many shares when I feel that the shorts would suddenly decide to double down. I’ve made quite a decent profit (mid to high double-digits) from that. However, often times when I feel like Tesla is stretched too high and is going to have a strong correction based on some one-off bad news, I’m often surprised that the stock doesn’t drop as much as I thought it would.
That is because Tesla investors are driven by Epic Meaning & Calling. Often times, it doesn’t matter what happens, or what the numbers say, there are Tesla investors (myself not included) who would still own the stock and even double down on the dips. People believe in Elon Musk and his mission, whether it is to go to Mars or populate the world with EVs. Because of that, they are not the type of investors that scurry away when bad news hits. This makes me feel very comfortable as I am riding the growth.
No matter what happens to the Tesla stock or the company, there is a whole army of people passionate about the cause to back it and keep the stock high. If Tesla ever gets to the point where they may risk bankruptcy due to their aggressive expansion plans, there will still be people waiting to fund it. And as mentioned above, raising new money and being diluted is a good thing I happily experience as long as I still believe the executive team remains competent.
Conclusion: Tesla, Inc. (NASDAQ-TSLA) is still NTT a startup investment
Now given the arguments above, Tesla is still not a real startup investment. Even though it has significantly less risk, it also has much lower upside (we won’t be seeing 50x returns in five years). Also, it is definitely a lot riskier than a regular value stock play. I would not recommend people to bet their life savings on Tesla.
There is still probability where Tesla never fulfills its super ambitious mission and ends up dying (even Elon Musk admits that). But to those who have some extra money and are thinking about investing in startups, I would say that Tesla is one of the best bets out there. In addition, Tesla also has a lot more liquidity than real startup investments as you can enter and exit at will as a public company…for now.
At the end of the day, I find Tesla, Inc. (NASDAQ-TSLA) a great hybrid investment that is less risky than investing in actual startups, but has a tremendous amount of upside compared to most public stocks. The public investors that have no idea/experience investing in startups do not understand how startup investing works, and therefore creates an opportunity for the rest of us who do.
My Gamification TEDx speech in Switzerland reach 100K!
A few years ago, I went to Lausanne Switzerland to do a TEDx speech on my framework Octalysis Gamification. It was my first time visiting Europe, and it was a huge blast.
It was a pretty difficult speech to do, since originally this talk was a 5-hour workshop, and I had to shrink it to a 17 minute talk. Not only that, I had to include a bunch of videos and fun things to share to make it dynamic. Of course, a TEDx talk is more like a brochure instead of a manual. The goal of a brochure is to get people to want to learn more. Therefore, a lot of the deeper knowledge, including Level II and Level III Octalysis couldn’t be covered, but I had to make it fun.
Little known fact – I said the first sentence incorrectly, and for the first minute I was simply trying to recover from that. Usually I just intuitively do my talks with my slides, but TEDx asked me to memorize my lines and rehearse with them a few times. I was all ready to go, but then when I was onstage, the lighting was MUCH stronger than I expected. It threw me off and I uttered the sentence wrong. It was supposed to be, “Imagine a world where WORK is obsolete – where LABOR is a thing of a past.” I said, “Imagine a world where LABOR is…” and then I felt sad. It took me 1-2 minutes to pick myself back up again and be on my flow again. I always wonder if the talk would have been more successful if I maintained strong energy from the very beginning. Of course, we would never know.
Successes in Gamification after the Gamification TEDx Talk
Since then, I published my book Actionable Gamification, and have won two Gamification Guru of the Year awards by the Gamification World Congress. Many fans, book readers, and clients have contacted me after watching that talk. I am grateful how much this talk has contributed to my accomplishments today.
Thank you TEDx, thank you Lausanne, and thank you Switzerland.
Now that we have covered the different implementation methods for gamification, we will explore the various applications of gamification in several industries.
In general, the majority of my clients represent four fields that I consistently see innovating time and time again, indicating a tremendous amount of application and growth in these sectors:
1) Product Gamification
Product Gamification is about making a product, online or offline, more engaging, fun, and inspirational through game design. Most companies struggle to create products that customers fall in love with, continue using, and passionately share with their friends. Some of these products have great “functional” purposes, but don’t focus on the motivation and Core Drives of their users.
In a previous era, consumers didn’t have adequate information and were accustomed to slow gratification. Along with immense barriers for starting new companies, it was not as detrimental for a company to simply assume that customers would use their products – provided that they were marketed correctly. However, people today are spoiled with instant gratification through the Internet, with immersive empowerment and real-time feedback through games, and the constant connection to their social network. Your users, customers, and employees are becoming less tolerant of badly designed products that do not take into account their motivations, especially when they have a variety of competitive alternatives they can choose from.
Status Quo Sloth of Startup Adoption
Many corporations and startups excitedly tell me, “Our product is great! Users can do this; users can do that; and they can even do these things!” And my response to them has been, “Yes, you are telling me all the things your users *can* do. But you have not explained to me *why* the user would do it.”
That’s the problem with a majority of company products – great technology and functionalities, but no traction. People don’t have a reason to go out of their way to use the product. Sometimes, a startup founder tells me, “Hey, Yu-kai, there’s no reason why people wouldn’t use our product. We save them money, we save them time, and we make their lives better.” On lucky days, customers themselves would even say, “Yeah, there’s no reason why I wouldn’t use your product. It saves me money, it saves me time, and it makes my life better. I’ll definitely sign-up sometime tomorrow.”
For those who have run startups or launched products before, you know the crucial part of the entire phrase is the ending. When people say they will do it “tomorrow,” more often than not it means “never.” This is because at this point they are motivated by Core Drive 8: Loss & Avoidance, and specifically by something I call Status Quo Sloth (Game Technique #85) – they are avoiding a change in their habits and behavior.
Remember how we talked about how Gamification is actually Human-Focused Design learned from decades, even centuries of game design experience? When you are launching a new product, its motivational standing is very similar to a game. No one has to play a game. You have to do your taxes; you have to go to work; and you really should go to the gym. But you never have to play a game, and let’s be honest, oftentimes you shouldn’t.
Because games have invested an amazing amount of creativity, innovation, and resources into figuring out how to get people to want to spend more time on them, there are definitely many great lessons you can learn from games for your own products. The key here is to make a product so exciting that customers become obsessed with using your product and are compelled to share how exciting their experiences were to their friends.