March 05 2008 / by Marisa Vitols
Category: Technology Year: 2008 Rating: 12
Hedge fund manager and self-described ‘natural optimist’, Melanie Swan is basically a super-human. When she isn’t frequenting future salons, lecturing about financial trends and emerging technologies or advising one tech start-up or another, Swan somehow squeezes in enough time to manage her hedge-fund and blog on topics ranging from tranhumanism, to market trends to virtual worlds.
Melanie’s rock-solid financial foundation, which includes degrees from Georgetown and the prestigious Wharton School, has translated into success at the start-up level (she was founder of GroupPurchase) and a subsequent rise through the ranks of iPass in Silicon Valley, JP Morgan in New York, Fidelity in Boston and Arthur Andersen in LA. Presently, she is the principal of MS Futures Group in Silicon Valley, holding the titles of hedge fund manager and futurist.
An active member of the Silicon Valley futurist community, Melanie is also a Lifeboat Foundation board member, sits on the Acceleration Studies Foundation Advisory Board and is a co-moderator of the Philadelphia and Boulder Future Salons.
Melanie was kind enough to share many of her tried and tested insights with us yesterday in this MemeBox interview. What follows is a condensed version of Melanie’s thoughts about the intersection between futurism and the corporate world, as well as her investment and life philosophy.
MV: What do you do and how is that related to the future?
MS: My goal is to stimulate the widest possible development and deployment of innovative technology. Historically, technology has been the one phenomenon that has demonstrated continuous positive impact on humanity, ever since the first flint. The benefits of technology are continuing to accelerate as the world becomes more democratized, expressed at higher levels of Maslow’s Hierarchy and networked globally for peak collaboration.
I also participate in creating and sponsoring innovative technology development and tools and mechanisms to facilitate its generation and adoption. Some of my current projects are Virtual Worlds Data Visualization, Open Access Futures Journals, and the Future of Technology: What might be the next internet?.
MV: How does your background as a futurist come into play when managing a hedge fund and running your own consultancy?
MS: Being a futurist means…
...having a toolkit of both quantitative and qualitative skills to analyze historical, present and future trends both near-term and long-term. Analyzing the implications of trends, patterns and other information applies to nearly any complex phenomenon, including the stock market, technological innovation and adoption, the political economy and many areas of science. The stock market is an interesting math and social behavioral problem to which a variety of quantitative and qualitative methods can be tested and applied.
Many industries and occupations are becoming increasingly complex. The Flynn Effect notes that average I.Q. scores have been rising in each generation, about three points per decade, perhaps due in part to the requirement to think more abstractly about the world. Not just futurists, but everyone can benefit from tools for working with the implications of trends, patterns and increasing volumes of information. In my futurist consulting and research work, I focus on sharing general knowledge and perspective and working with clients to apply it to specific contexts. The part I enjoy the most is seeing people get excited about new technologies and engage in developing and implementing them.
MV: When advising others, what makes you confident and accurate in your guidance? How certain can one ever be about the future?
MS: The only way to be sure about the future is to expect the unexpected. The story of history is a chain of discontinuities, for example the plane, the car, the radio, wars, nuclear weapons, satellites, computers, the Internet and globalization. Discontinuity is nearly impossible to predict but the possibility for rapid transition time and doubling capacity can be assessed. Cascading technology advances in related fields can also be evaluated, for example, disk drive and battery advances made MP3 players possible; natural language understanding could quickly trigger a large segment of artificial intelligence applications.
MV: Do you see financial markets evolving to be more effective in the coming years? If so, how?
MS: There are three main factors directing the evolution of financial markets in the next decade: first, the growth of BRIC (Brazil, Russia, India and China) which is akin to the arrival of the Asian Tigers (Hong Kong, Taiwan, Singapore and South Korea) on the world economy in the 1980s, second, the increasing global interconnectedness of economies and third, the demand for natural resources (energy, water, food). These or other factors are not likely to change the efficiency dynamics of financial markets. Imbalances, bubbles, corrections and cycles will persist. The global interconnectedness of economies makes reverberations instantaneous but can also stimulate quicker recovery.
The biggest future evolution in financial markets could be the increasing presence of non-monetary currencies to reflect the new-value attribution models triggered by the radical shift to free information in the economy.
MV: Why should people consider the possibility of a singularity?
MS: Biotechnology, nanotechnology, and artificial general intelligence are perhaps the three technologies that could have the largest potential impact. Other possible technologies that could have substantial influence include fabbing, synthetic biology, Metaverse technologies, robotics, quantum computing, intelligence augmentation, personalized medicine, affordable space launch and anti-aging therapies.
People should be expecting revolutionary levels of change in their lives and orient themselves to learning about and understanding new technologies and their capabilities and detriments. Technical literacy is increasingly necessary to fully engage with and participate in the society of today and the future.
MV: Peter Thiel recently said that the likelihood of a singularity means there’s great potential for compound growth ahead of us. How would a singularity affect your investment decisions?
MS: The coming technology revolutions which could have an Internet-level impact have opportunities for compound and even geometric financial returns right now. Some examples are cleantech, personal genomics, anti-aging therapies, 3d data manipulation tools and narrow artificial intelligence as a more efficient version of outsourcing. There are many opportunities for entrepreneurs, corporations and public and private investors.
Technology is evolving faster than financial markets. Information is increasingly free. This is causing well-established economic paradigms to expand to reflect this shift. Free access to information pushes the bottleneck higher up the scale to a less entropic, higher resolution value point. What is now valuable is what is being done with the information. Non-monetary currencies for attributing value initially started with reputation. Now they are becoming more rigorous in their assessment of value and are being used for exchange. Some of the new market mechanisms include attention economies, open money (related event: unMoney Convergence), time banks, social capital markets (related event: Social Capital Markets prediction markets. Evolving to a multi-currency culture could ease a potential future transition to a post-scarcity economy (PSE) as traditional money would be only one recognized store of value.
MV: Given your interest in transhumanism, could you describe your vision of human evolution over the next few decades? How do you think it will all play out?
MS: The long-term evolution of humans could be quite dramatic, even more dramatic than the developments triggered by transhuman technologies. At some point, it is likely that all biological processes will become understood and manageable. Human source-code will be edited. Radical longevity (immortality), together with a potential post-scarcity economy (PSE) triggered by technology revolutions from biotechnology, nanotechnology and artificial intelligence, etc. and the potential replacement of humans by robots for love and sex will make it possible for an automatic wholesale redesign of society which has been primarily organized around reproductive fitness for 500,000 years.
The computer and the brain are the two main contenders for the future of intelligence and will probably overlap and enhance each other in the interim. Ultimately intelligence should be substrate agnostic, it could perform equally well in a variety of digital and physically embodied environments, for example as a miniature probe on Enceladus in a low-gravity body-plan optimum for Mars, as a virtual world avatar, in a computer or in a human or animal embodiment on Earth, using the same ease with which humans change car, bus and skateboard vehicles today.
MV: What makes you optimistic and/or pessimistic about the future?
MS: I am excited about the many technologies under current development which could impact not only short-term challenges but also have tremendous future extensibility, enough to start putting a Kardashev Type I society (where all potential power on the planet is harnessed) within reach. Some of these technologies include: bioremediation (industry conference) biofuel and synthetic biology, molecular nanotechnology, particle accelerator technology, alternative energy and nuclear waste storage, management and eventually decomposition technology.