Video Of The Week: Brad Burnham On Iceland, Economic Development, and Networks

My partner Brad and our colleague Nick have been advising some folks in Iceland on economic development and how the Internet and networks could be the key to giving their economy a big push. They have been doing that for several years now.

Last March Brad went to Iceland and gave a talk to a bunch of policy makers there. It was put up on YouTube recently and I am making it the video of the week this week. In this talk Brad lays out a vision of what the Icelandic economy look like in ten years with the right policy choices. He also explains why he and the rest of USV is interested in that (hint: jurisdictional competition).

#hacking government

Comments (Archived):

  1. WA

    And the hot springs are very nice too. Just saying.

  2. William Mougayar

    “Networks challenge regulators.” That says it all.

  3. Matt A. Myers

    Iceland seems to be very smartly implementing systems to support leading metrics that lead to innovation and growth – economic activity. I have a few friends who have gone there on art-related programs and they have had great experiences.For reference sake at how important these factors are for Iceland, and how quickly they could implement and be agile and pivot towards this innovative thinking — Iceland’s population is 320,000 (2012) with 1/3rd of their population concentrated in a single city, Reykjavik. A lean startup.

    1. jim

      Iceland is the Velvet Underground & Nico of countries. Whereas only 10k bought the first Velvets record but each one went on to start a band, only 300k live in Iceland, but seemingly every one of them is an influential artist of some sort.

  4. LE

    I just watched 22:59 of this.Brad is to smart [1] to be giving a presentation like this (meaning to this audience) without some coaching in the area of sales and selling. That’s what he is doing, right? He’s trying to get people to take action and agree with what he is saying. My “puny brain” found it really disjointed and hard to follow. It’s very clear in Brad’s brain but not in my brain as a viewer. And I fully understand every point he is making. (Many of the examples seem very retro but that’s another story ..)He jumps around and makes decent points and gives many examples, but how he is presenting this is, I’m almost sure, is not the right thing for “a bunch of policy makers” in Iceland. (This is separate by the way from whether he “makes the sale” or not. You can win a game but still play a bad game, right?)Luckily this is definitely something that can be practiced, critiqued and improved upon if the need exists (meaning he plans to do this again) and Brad wants to improve.I really apologize (and considered not saying this at all) as I’m not trying to diss Brad (who I don’t know) but I thought I’d share my thoughts so others might learn. (Which are taken from my knowledge and experience with sales and selling).[1] By “to smart” I don’t mean it in a patronizing way I simply mean that he isn’t on the level to be able to see it from the perspective of the audience that he is giving this talk to.

    1. Richard

      (I too am reluctant to be critical), but I don’t think Brad made the connection between NY requiring airbnb to enforce its safe housing regulations and Icelands electricity costs and facebook penetration? Not sure I see how Iceland penetrates US state sovereignty laws. (I have a few minutes left in the presentation, maybe he ties it all together)

      1. LE

        Not knowing the target audience it’s hard to say exactly how you should have “mock jury” tested this type of speech. (Who should be in the mock audience?)But in a perfect world, assuming it was important, (and if you are flying to Iceland, as opposed to speaking to a local high school, I will assume it’s important) it would have made sense to (in addition to my other suggestions) to test it out on a group of “normals” (mock jury) to see what they thought.Most people though either don’t see the need to do this or don’t want to put in the effort to do this (perhaps because it doesn’t matter). [1] I remember talking to a friend who had a son applying to a really good college. I suggested before going for the interview the son go on interviews at less important colleges to get practice. He scoffed at the idea thinking that his son could could just go in for the most important demarcation point of his life w/o practice and just wow them. What a mistake that was.[1] Or simply don’t have the time. Which is entirely possible that that was the case! (Unlike the kid applying to college who no doubt has the time Brad is busy and wouldn’t necessarily be able to do more than he did even if he wanted to.)

    2. Matt A. Myers

      I found it connected and flowed well. It was giving important pieces as examples to try to paint a picture.

      1. LE

        I think people’s attention spans have to be taken into account. While the people that were there were, in a sense, trapped in the room [1] it didn’t mean that they weren’t able to loose focus and miss the point. Day dreaming.So the question is, how many people would think it’s “connected and flowed well” not whether some people (such as you) might have had that feeling. You are selling to a group and have to hit the “lower” common denominator.[1] This is similar to what we see with movies made today vs. yesterday. The lack of realization that people aren’t necessarily trapped in the theater watching and if you don’t grab their attention in the first few minutes they will simply choose a different netflix to watch. (In the theater you stick it out past the slow start because you really have to or you lose your money that you paid for a ticket). So if you are editing a movie that you know won’t make it in the theaters you might as well do the cut so it grabs people right from the start as opposed to assuming they will stick around and enjoy it after watching a bit.

        1. Matt A. Myers

          Does the quantity of people really matter, or is it more important that the right people who needed or could understand it then understand it and then can help take advantage of that and move things forward?

          1. LE

            The quantity doesn’t matter except that having more people understand the concepts more or less implies that there is a greater probability of someone taking some action.After all it certainly is easier now to learn programming and photography with all the info that is available on the web but obviously even before (when it was much more difficult) people took action and created things.What you are talking about is really “selling to the decision maker” (which is always what you want to do as long as you don’t make the non decision maker (who may have influence) feel left out. But I don’t think that by giving a better, more simplistic, and easily understandable presentation (and getting more people to understand “why” and the “benefit”) you are going to alienate the right people. The key is “I don’t think so” that’s my judgement and opinion (others may differ).By the way this is all somewhat of a “camel by committee” discussion. [1] Since different people have different visions and approaches.[1] It’s hard to get something done if you have people who see things differently and in the end the best thing as Bush would say is to have one person who is the decider given the various input. One of the reasons for sure that some of the biggest wins in business history have been by “the tirant who gets his way” as well as I guess (w/o checking) some of the biggest failures.

          2. Matt A. Myers

            I disagree re: quantity means greater probability of something happening. Quality or understanding of something has far greater reach or implications. If more people understand it but not fully, are they then taking action in the wrong or inefficient direction?I agree with everything else you’re saying.

    3. sigmaalgebra

      Instead of damning Brad’s speech with faint praise,maybe I’ll praise his speech with faint damnation!I can agree in part with what LE is saying.But my take was that Brad’s intention was to givethe Iceland policy makers a broad direction to anattractive area on the horizon and, then, let themdo the rest.When Brad openly and clearly gave his ‘agenda’, his’why I am here’ — I’m a VC trying to make money andwant to ignite a world wide competition for ‘greenerpastures’ — he added credibility and even sincerityto his points.I did notice, maybe like LE, that Brad didn’tcarefully build a ‘pyramid’ with a sharp point atthe top and a specific, ‘compelling’ ‘call toaction’. So, he wasn’t trying to close a sale of,say, a new submarine fiber optic cable from MAE Eastto Iceland to a big Cisco switch at the end. Fine:The cable will come when it is needed from thebusiness growth from the new Iceland policies.In a way, such a presentation has an advantage:Since the presentation and its organization did nothand over the content and a supported ‘call toaction’ like really easy to swallow, blended andstained baby food, the listener had to think alittle, that is, ‘digest’ the content. But only insuch a way can a listener get significantunderstanding of any non-trivial material. Thepeople in the audience who heard the broad,world-shaking, potential but, still, didn’t want tothink were mostly lost to the cause anyway. Forthose who were adult enough actually to digest somesuch content and pursue the action, Brad gave themsome nutritious food. Also, Brad didn’t lose hiscredibility by ending with a climax of a call toaction like some used car salesman or even a ‘softshoe’ salesman.Or, Brad wasn’t really trying to get Iceland to doanything but to understand that Iceland was in aworld competition for new investment and that, thus,Brad’s next talk might be at the Azores, thesouthern tip of Greenland (good by product of thecoveted ‘global warming’ you understand!!), Bermuda,the Faroe Islands, Lichtenstein, etc.! I.e., anarchitecture firm that wants to build sports arenasfor NBA teams doesn’t really have to give speechesto fire up the coaches of individual teams — thosecoaches already fully appreciate the intensecompetition of the NBA.

      1. LE

        like really easy to swallow, blended andstained baby food, the listener had to think alittle, that is, ‘digest’ the content. I love the way you put that. Especially the “stained” baby food.But only in such a way can a listener get significantunderstanding of any non-trivial material. Thepeople in the audience who heard the broad,world-shaking, potential but, still, didn’t want tothink were mostly lost to the cause anyway.Is it really a lost cause though? After all if you are trying to feed a baby you give it something it can digest and that it finds appealing. Not something that is appealing to you and what you can digest. So of course feeding the baby the wrong food is a lost cause which is why you give them gerbers and not olives.I recently went with a relative to a funeral home to help plan a funeral. I suffered for 3.5 hours listening to what I could have done myself in 30 minutes. (The casket pitch and setup is great it comes at the end when everyone is worn down. I always learn from this stuff it’s totally Cialdini) Anyway the FD was selling to the old lady that I was with. Not to me. So suffer I did. Wow that sounds really bad, doesn’t it? Comparing my suffering to her suffering.That said the “selling” part of this to me didn’t require a call to action. It just required that people understand and pay attention and stay awake. Without being in the audience (and even waiting till the end to see if any questions I stopped early as I said) I don’t really know all I need to know with respect to how I am judging.From that angle even Seth Rogen (who spoke to congress the other day) and did have a call to action really failed (from what I’m told I didn’t watch it). (Not to mention he screwed up afterwords making fun of the senator who left the meeting as well). With Rogen the first thought that came to my mind was “why is Alzheimers more important than the 500 other things that need funding” (don’t know the answer but I thought he was immature in not knowing that he couldn’t just show up, say shit, and get action just like that.)

        1. sigmaalgebra

          > Is it really a lost cause though?In this case, I believe so: If a listener didn’treally work to ‘digest’ the content, then theylikely won’t understand the subject well enoughto contribute effectively.It’s a little like learning calculus: I can say, calculusis among the elementary consequences of thecompleteness property of the real numbers, but thatdoesn’t do much good without doing a few hundredexercises and, thus, thinking about, ‘digesting’,the content.

          1. LE

            In this case, I believe so: If a listener didn’treally work to ‘digest’ the content, then theylikely won’t understand the subject well enoughto contribute effectively.In an academic setting you are right.But “in real life” what I have almost always found to be true is that you make it easy for people to give you what you want since by nature most people suffer from all sorts of ills that make them take the easy route.As such I can get compliance from people if I want but also get people to not comply by giving them an “assignment” and making it difficult for them to comply (and there are for sure reasons to do that, stalling a deal is only one of them). [1]Now if you are saying that if someone won’t take the time to digest then they aren’t going to take the time to take action (because that takes effort) then I agree with that.As long as I’m “foaming” along a version of some of this (action, lazy) is what happened at the self storage that has been jacking up the price that I am paying while advertising a lower price on the website.When I called to complain the “clerk” said “oh sure you can get the lower price but you have to move everything to a new unit” (really!). When I complained further they then said “sure you can call our corporate phone number and maybe they will” (so they gave me an “assignment”). Since the last thing I want to do is call a corporate number (phone trees and all) I have avoided doing that and I’m still paying $120 per month for what should be $80 per month. To store things that I probably don’t need. (This is the basis of storage success of course it’s probably taught in business school after “health clubs people don’t show up and that’s good”.)[1] So if I want the insurance adjuster to give me what I want (approve my claim) I give him everything he needs in order to come to the right conclusion. For example a claim from an auto body shop that he can just copy and he doesn’t have to think.And if I need to stall for time in a real estate deal (so I can wait for other offers) then the opposite. I would give them a contract that their attorney is sure to choke on and get back to me with a vast number of changes. I don’t do it directly by saying “I need more time”. No lying is involved. That way they don’t know or have any suspicions.

          2. sigmaalgebra

            We’re in apparently full agreement:> Now if you are saying that if someone won’t take the time to digest then they aren’t going to take the time to take action (because that takes effort) then I agree with that.Yup. For Brad to get a return on his talk, some peoplein Iceland will have to do some hard work and, thus,need good understanding of the issues from ‘digesting’his content. Brad was asking for years of hard workin Iceland on national economic policy of Iceland, not a fast sale.

          3. LE

            Brad was asking for years of hard workin Iceland on national economic policy of Iceland, not a fast sale.So seems like the way to achieve this is to provide the handholding necessary (by way of a consultanting firm/lobbyist etc) that essentially writes the legislation all ready for review “sign right here”. Or at the very least something that is ready to review so that nobody needs to do the work from scratch out of their time or budget.

          4. sigmaalgebra

            Wow! “Hand holding”! “Signright here”! Just call you “TheCloser”!I was guessing that Brad’s intentionswere more along the lines of goodUSV PR, making world-class ‘contacts’, waking up some USpolicy makers, slowing down someUS policy makers eager to regulate/tax the Internet to death,stirring up some internationalcompetition for the most ‘businessfriendly’ spots on the planet, leaving Iceland with some ‘goodvibes’, etc.To paraphrase, “A global Internetpolicy talk in Iceland? That’snot cool. Want to know what’scool? Fly into Iceland and inless than 48 hours invest inan international ‘hub’ with a$10 billion pre-money.”.Let me guess: In high school,you were the nightmare of everyfather in a radius of 200 mileswith a pretty teenage daughter,even for just a first date!Here’s something more subtle,…even sublime, from1:30:00 to 1:36:30.

          5. LE

            Let me guess: In high school,you were the nightmare of everyfather in a radius of 200 mileswith a pretty teenage daughter,even for just a first date!Well not exactly. But there was that one time (as I’ve frequently mentioned) that I talked the neighborhood girl into posing naked for me in the basement (I actually had lights and probably threw up a backdrop as well) and then developed the pictures in my darkroom. I’m guessing that young people can’t really imagine how difficult that was to do at the time.

          6. Amar

            on a completely unrelated note (purely for my curiosity sake): why not use soundcloud embed for this? This was just audio and no video plus you had to call out a time section. Is this a result of YT being on top of the search results?

          7. sigmaalgebra

            > why not use soundcloud embed for this?Sometimes I listen to music via YouTube. I don’t really know what SoundCloud is or does. As I recall, I visited the SoundCloud Web site once and didn’t like it.> a result of YT being on top of the search results?No, not really. “Search results” for music don’t mean much to me since I’ve been a classical music fan back to high school, at one point actually made some progress in violin, and have good familiarity with many composers, pieces, and performers.Currently I like to listen to the operas in Wagner’s ‘The Ring’, that is, ‘Der Ring des Nibelungen’. There are four long operas there with something over 20 hours of music. I’m working my way through all four, slowly.Much of the music is terrific stuff by itself. Still, good versions of the libretti are readily available on-line, and the stories are mostly quite simple, so reading through the libretto for one of the operas is fast, and then the music makes more sense.YouTube has performances of ‘The Ring’ conducted by Solti at Bayreuth; since I have a lot of respect for Solti, I listen. The scores are also available on-line; for the few minutes I mentioned, I intend to look at the score and see a little of how the heck Wagner did that.Currently we are in the early years of exploiting microprocessors and related devices. Maybe in time our exploitation will become amazing, thorough, and polished. Well, Wagner was at the end of the ‘romantic period’ in classical music where composers, back through at least Beethoven, were exploiting a symphony orchestra. Much of Wagner’s exploitation was amazing, sublime, gorgeous, magical, dramatic, and seemingly thorough and polished. In particular now it’s fun to look at the scores and begin to see how the heck Wagner made his exploitation. ‘The Ring’ is one place to look but, of course, there are the other Wagner operas, especially for something quite different ‘Tristan und Isolde’ and for something quite polished ‘Parsifal’.

          8. Amar

            🙂 What an awesome reply. Thanks.

  5. Vineeth Kariappa

    Change intro of USV, “We only invest in Billion dollar ideas.”

  6. jason wright

    “regulatory capture”, the stockholm syndrome of public policy ‘reform’.

  7. jason wright

    if iceland reforms and thrives other jurisdictions will observe and follow. are we saying that cheap geothermal energy is its defensible?Jurisdictional competition -“The dominant opinion is that regulatory competition between jurisdictions creates a “race to the bottom” in standards, due to the decreased ability of any jurisdiction to enforce standards without the cost of driving investment abroad. A small group of advocates say that regulatory competition in fact creates a “race to the top” in standards, due to the ability of different actors to select the most efficient rules by which to be governed.”

  8. Emil Sotirov

    I keep this page in an open tab half a day already… and cannot find a moment to see the video. Same probably true for most AVC regular commenters… explains small number of comments.

  9. David Semeria

    A rare sighting of the lesser-spotted Brad. So why was he spotted in Iceland of all places?Iceland has a population of 300K which is only slightly more than Boise, Idaho. The key difference is that Boise is a city whereas Iceland is a nation. This might explain why policy-driven success in Iceland would generate more global resonance. Or perhaps Brad just likes geysers…

    1. Emil Sotirov

      Brad is the dark intellectual matter at the center of USV.

      1. fredwilson

        Correct. Our secret weapon

        1. David Semeria

          The proposition that a regulator would resist liberalization primarily because it would render the regulator irrelevant is very, very convincing.I think it definitely deserves a blog post, Fred.

  10. Eleanor Haas

    Brilliant, Brad! Yes, regulate adaptively after the fact in exchange for transparency because regulation can then be based on data generated by the networks. Yes, understand that to transition incrementally is the only sensible way to go. Yes, the network economy. But these are very high-level concepts that require thoughtful messaging to win the support they need and deserve.