10xDNA – Mindset for a thriving Future E-Book

Frank Thelen

• Herausgeber: Frank Thelen
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2020

Seitenzahl: 288

Beschreibung

Digitalization was just the beginning, the biggest revolution for mankind starts now Flying cars, autonomous driving, 3D-printed houses and lab-grown meat - what sounds like a science fiction movie, is already a reality. We are on the verge of a new age. Building upon digitalization, technologies like artificial intelligence, 5G, robotics, quantum computing and synthetic biology will bring profound changes to the world we know today. The impact on our everyday lives and our economy will be immense. The Internet-Era alone created companies worth over 7 trillion dollars - but only the US and China reaped the benefits. The upcoming era of exponential progress offers many new opportunities. Europe needs a mindset shift, a unique 10xDNA to take advantage of these prospects. 10xDNA will inform and inspire those who wish to understand how our world will change in the next decade. Instead of fearing the unknown, we should embrace the opportunities to build a strong, fair and diverse Europe. Are you ready to unleash your 10xFuture?

Leseprobe

THIS BOOK IS DEDICATED TO THE 10x THINKERS. THE VISIONARIES AND MOVERS & SHAKERS WHO VIGOROUSLY DRIVE INNOVATION AND TECHNOLOGICAL PROGRESS THROUGHOUT EUROPE.

Frank Thelen is a European serial entrepreneur, technology investor, TV personality and best-selling author, who since 1994 has served as founding chief executive of several companies that utilized new technologies to deliver unique and outstanding products and services. As the founder and CEO of Freigeist Capital, Frank focuses on unleashing European Tech founders with his experience, network and capital. His own products have improved the lives of 100+ million customers in 60+ countries around the world. In 2018 Frank published his autobiography, Startup-DNA, which became one of the most succesful non-fiction books of the year. He was the first investor in companies like Lilium Aviation, Xentral, Wunderlist, Air Up, Ankerkraut and YFood.

Markus Schorn has been dealing with the fundamental effects of technological progress on Western society in general and business enterprises in particular throughout his career. His activities and accomplishments center around the interactions and interrelationships between the worlds of technology and business. Markus has successfully guided the market launch of a number of groundbreaking innovations, using a broad range of business models for both enterprises and consumer segments. Thanks to these achievements, he has become a highly regarded adviser for corporate decision-makers, and a mentor for German startups.

Table of Contents

Foreword

How the Moon Landing started the 10x Revolution

The US vs. China: Silicon Valley vs. The Chinese Dream

10x — The Background

The 10x Technology Kit

Artificial Intelligence

Robots & Automation

Blockchain & DLT

5G, Edge Computing & IoT

3D Printing

Synthetic Biology & CRISPR-cas

Energy

Era 3.0: Quantum Computing, Nuclear Fusion, Brain Appstore, Singularity

Mobility: Autonomous Driving, Flying Cars, Hyperloops

Food: Labgrown Meat, Hacking Yeast, Vertical Farming

Healthcare: Eliminating Diseases, Stopping the Aging Process

Humanity 2.0: Augmented Intelligence, Cyborgs, Biohacking

Walk the Talk: The 10x Startups in Freigeist’s Portfolio

The 10x Mindset: Courage, Dread, Bold Moves

The 10x Methods: Serendipity, FPT, The Medici Effect

Brilliant Minds

Acknowledgments

Foreword

While writing my first book Startup-DNA, I initially became aware of the era of exponential progress we’re entering. Not only one, but several disruptive technologies will soon bring profound changes to our personal lives as well as all industries. My first book was a rags-to-riches tale of how I went from being a drop-out at school and a down and out failure in the business world to becoming a leading startup entrepreneur and seed-capital investor. My initial aim in writing about new technologies was solely to describe how they work and cite a few compelling illustrative examples. But then one day I realized that if my observations in the book were accurate, they could potentially have far-reaching effects: notably European technology companies being reduced to the status of mere data suppliers for the US and China.

When Startup-DNA was published in late 2018, it was already clear to all attentive that Europe had long since become at best a second-rate player when it came to the internet and cloud computing. In contrast to the US and China with their countless IT mega-corporations, in my own country, Germany, no IT company of any importance had emerged since the founding of SAP back in 1972. And yet, no one seemed to be too concerned about it when I wrote that this was only the beginning of a highly significant trend. For as it turns out, the next wave of new technologies, which are part of my 10x Technology Kit, are bound to take on even greater importance. Even nowadays, the vast majority of our industry leaders and politicians are acutely unaware of disruptive technologies' immense power and exponential progress. The figures speak for themselves. In January 2020, Tesla’s market capitalization amounted to $100 billion and, for the first time, exceeded that of Germany’s leading automaker. Only a month later, the gap was so large that the combined market capitalization of VW and BMW was lower than that of Tesla. In September 2020, the market cap of Tesla reached $400 billion. Thus, not only had Germany’s IT sector missed the boat when it came to utilizing advanced technologies such as the internet, cloud computing and smartphones – but also, for the first time, the country’s flagship industry’s leading position was being taken over by an “upstart” disruptive player.

As a German who loves his country, and cheers for the European Union, I strongly feel that the world needs at least three great powerful voices to come up with fair and equitable solutions for the tremendous challenges humankind is facing today. If the world continues to be a place where the discourse on fighting climate change and regulatory measures for artificial intelligence are left solely to two great powers – the US and China – I fear that the responses to these existential matters will often be shortsighted. We need a strong and united Europe to have a say in these critical discussions and rulings. But Europe runs a serious risk of relinquishing this status within the next decade.

I have decided to do what is possible, within my limited power, to change this situation. My venture capital firm Freigeist only invests in Startups, which have the potential to support Europe in regaining and maintaining its position as a major economic force – every Startup must tackle a major challenge and work on a scalable and meaningful solution. My aim and passion in life is to contribute to the development of an urgently needed thriving European Technology Ecosystem.

In this book, we discuss the methods, the mindset and underlying technologies of the generation 10x. We wrote this book for readers who want to understand these new and disruptive technologies. We want to show how you can make the most out of these opportunities in your private and professional life. We want to encourage founders, decision-makers, politicians, teachers and everybody who wants to contribute, ensuring that Europe remains a strong voice when global issues of utmost importance are discussed.

How the Moon Landing started the 10x Revolution

On July 20, 1969, Neil Armstrong became the first person to set foot on the moon – and the moving, immortal words he uttered at that incredible moment have echoed around the world and down through the years: “That’s one small step for a man, one giant leap for mankind.” But what most people don’t know is that taking this “small step” involved years of extensive R&D – and ultimately gave birth to a new paradigm: 10x.

During the 1950s and 1960s, the US and USSR were engaged in a bitterly contested space race, in which the Soviets had been the leading player for quite a while. With the launch of their Sputnik satellite in 1957, the Russians became the first to put a man-made object into orbit. And in that same year, they put the first living creature, a dog named Laika, into orbit in a space capsule. Four years later, Yuri Gagarin became the first human being to orbit the earth.

On May 25, 1961, President John F. Kennedy, fearing that the US were going to lose the space race, announced before a special joint session of Congress the dramatic and ambitious goal of sending an American safely to the Moon before the end of the decade.

At the time, this moonshot, as it came to be called, seemed like wishful thinking, an impossible dream, more than anything else. And still today, some people believe that the moon landing never actually happened. It’s hard to imagine how NASA’s employees must have felt when President Kennedy assigned them this Herculean task. Just imagine for a moment, how you might react if the head of your organization asked you to take on what at first glance seemed like an insurmountable challenge. Would you immediately give him a laundry list of reasons why there was no way you or anyone else could ever hope to succeed? Or would you accept the challenge and do everything in your power to find a solution?

Well, as is well known, NASA adopted the latter approach – although the chances of succeeding seemed extremely dim at first. The rockets NASA had at its disposal weren’t nearly powerful enough to carry a command module containing three astronauts, plus a lunar module and sufficient fuel and supplies to make the trip to the Moon and back. At the time, German-born rocket specialist Dr. Wernher von Braun observed that for a moonshot to be successful, the rockets needed would have to be ten times (10x) more powerful than those currently available. In other words, Dr. von Braun felt that the moonshot was a “mission impossible.” But President Kennedy was determined to succeed – and expressed his unshakable faith in the moonshot in his now famous 1962 Moon speech, in which he stated, in ringing tones, “We choose to go to the Moon. We choose to go to the Moon in this decade and do the other things, not because they are easy, but because they are hard.”

And so, NASA set about using all the resources at its disposal to make Kennedy’s dream of a moonshot a reality. When the project was in full swing, more than 400,000 R&D specialists and other engineers, as well as mathematicians, were giving their all in the interest of coming up with revolutionary new solutions. The US plowed around 2.5% of its GDP into R&D for these new technologies – $25 billion annually, the equivalent of quadruple that amount in today’s dollars. This massive investment of financial and human resources not only paved the way for the moon landing, but also gave rise to completely new industries. The offshoots and ramifications of the solutions that the many brilliant minds who made the moonshot possible came up with are still affecting us today; for example, MIT Draper Laboratory director Margaret Hamilton developed the on-board flight software for the Apollo program. She coined the term software engineering and developed new approaches for system architecture and end-to-end testing. Today, software development entails not only creation of the relevant applications, but also of the attendant code – which undergoes a massive number of pre-release test scenarios and checks, to ensure that the software runs smoothly and is glitch-free.

Robert Noyce of Fairchild Semiconductor and Jack Kilby of Texas Instruments developed integrated circuits (microchips) for the Apollo project. Without these components, it would not have been possible to control and monitor the various Apollo rocket systems and navigate the Apollo space capsules. Kilby and two other scientists were awarded the Nobel Prize in Physics for this work. Robert Noyce and Gordon Moore founded a company called Integrated Electronics, or Intel for short, in what later became known as Silicon Valley. Today virtually every electronic device, from vacuum cleaners to headphones, depends for its operability on one or more microchips.

The Apollo project created a biotope, it was the cradle for engineers, entrepreneurs and scientists who sincerely believed that almost any goal was achievable. And it is precisely this mindset that can pave the way for groundbreaking discoveries.

R&D stands for Research and Development. There are R&D departments in most companies which are dedicated to focus their time and energy on future strategies and new product developments.

End-to-End Testing ensures a smooth flow of an application from start to finish. The purpose of end-to-end testing is to simulate the real user scenario and to verify the function of the system under test and its individual components.

The US vs. CHINA

10xDNA and Silicon Valley

The Apollo project was the first genuine 10x project. Many of the brilliant men and women who participated in the project went on to start their own companies and commercialized the technologies they’d developed. But more importantly, these technological pioneers collectively gave birth to a new mindset: think bigger - Moonshots are possible!

These individuals eventually made their homes in cities that fell within the catchment area of Stanford University, such as Mountain View, Palo Alto and Cupertino – and brought their 10xDNA along with them. The family tree of many major companies such as Google, Cisco and Nvidia is directly linked to the founders of Fairchild Semiconductor and thus to the Apollo project.

Robert Noyce became a father figure and mentor for the young Steve Jobs, whom he gave valuable support during Apple’s startup phase.

Other Fairchild alumni founded venture capital firms such as Kleiner Perkins and Sequoia, which to this day are leading startup financiers. Kleiner Perkins was among the earliest investors in Google, Amazon and Spotify, while Sequoia invested in startups such as PayPal, YouTube and WhatsApp. The seed capital they provided played a major part in the success of companies whose products and services are used today by millions of people around the world.

An ethos developed that fostered – and richly rewarded – thinking as far as possible outside the box, along with a mindset that was relentlessly in search of the next great leap forward, and that never settled for minor optimizations. Today, 10x is a permanent fixture in the culture of many Silicon Valley companies. Whereas most CEOs are content with 2-3% optimization per year, Silicon Valley leading lights such as Google founder Larry Page are not. For Page, 10x has become a watchword, a mantra, an ironclad tenet for the conduct of his organization’s affairs – and even a 10% improvement is tantamount to mere coasting and resting on one’s laurels. As Page sees it, the only way to outdo the competition by a factor of 10 – and achieve real progress – is to think exponentially and break new ground. A prime example of 10x in action can be found in the 2004 market launch of Gmail. Google’s “exponential” innovation was to offer Gmail users 1 gigabyte of free email storage space – 250 times more than its competitor, Yahoo. However, the catch was that, due to data storage costs amounting to around $4 per gigabyte back then, and with 100 million envisaged users, Google stood to lose a sizeable chunk of change. No sane financial controller of a conventional corporation would have ever green-lit such a folly, fearing to lose his job. But imbued as it was with the 10x ethos, the Gmail team put on their 10x “think ahead/think optimistically” caps – which enabled them to foresee that technological progress in data storage capacity would greatly reduce the attendant costs. As it turned out, they were right.

I think it’s important to reason from first principles rather than by analogy. The normal way we conduct our lives is we reason by analogy. [With analogy] we are doing this because it’s like something else that was done, or it is like what other people are doing. [With first principles] you boil things down to the most fundamental truths…and then reason up from there.

Elon Musk

Gmail’s user base expanded exponentially, while simultaneously data storage costs declined precipitously, to a few cents per gigabyte. As a result, Gmail became an enormous cash cow, with today over 1.5 billion users.

Another key proponent of the 10x paradigm is Elon Musk, whose preferred method for coming up with radical new solutions is called first-principles thinking. First, Musk breaks down major challenges into their constituent elements. Then, he and his teams set about rethinking these various elements from the ground up, using new technical methods. Instead of focusing on how something has been done so far, Musk asks himself the following question: What is technically feasible, given the current state of advancement in the fields of physics and chemistry, and the laws governing these disciplines?

For example, in 2002 Musk founded SpaceX, whose avowed purpose, according to the company’s website, is to “revolutionize space technology, with the ultimate goal of enabling people to live on other planets.” To achieve this goal, SpaceX is developing reusable rockets, which will radically reduce the price of space travel.

First Principles Thinking describes a method of thinking in which a problem is broken down to its fundamentals. Based on these fundamentals alone, the best approach is sought. You must deliberately ignore methods and procedures that have been used up to now and focus on new approaches or technologies that should be technically, physically or chemically possible.

It’s often easier to make something 10 times better than it is to make it 10 percent better.

Astro Teller, Google X

Musk’s initial plan – to buy and recondition decommissioned Russian space program rockets – went awry; but instead of giving up, he broke space-travel rockets down into their principal constituent elements – namely aerodynamics, thermodynamics and engines. Armed with this schema, Musk’s team came up with a way to build rockets using inexpensive off-the-shelf components.

This approach enabled SpaceX to reduce the per-payload-kilogram cost of firing up a rocket from $18,500 to less than $3,000.

10x and Google X

Alphabet (formerly Google) took the 10x paradigm to unprecedented heights. Alphabet adopted a revolutionary new approach that set the company apart from its competitors, which were busily establishing R&D teams in the hope of driving innovation for their core businesses. X (aka the Moonshot Factory) is a division of Google whose mission is to generate moonshot-based businesses for Alphabet by developing radical new technologies aimed at solving some of the world’s hardest problems – and launch startups that have the potential to become even larger than Google itself.

At X, moonshot projects are tackled using a set procedure. First, a problem is identified that affects hundreds of millions of people. Then, a team of creatives, scientists and inventors brainstorms possible solutions to the problem, however far-fetched they may seem. If current research or recent technological breakthroughs even remotely suggest that the solutions the team comes up with could potentially be implemented within the next ten years, a moonshot team forms and gets down to work.

Only a fraction of the around 100 solutions vetted by X each year make it to this stage. As odd as this approach may seem at first glance, it is in fact the only reliable path to the development of 10x innovations; for this method enables 10xers to gain the perspective on existing solutions and processes necessary to think outside the box. This strategy has proven its worth on a number of occasions.

Waymo for example, began in 2009 as the Google Self-Driving Car Project. The German-born Stanford Professor of Computer Science Sebastian Thrun led the mission to develop the sensors, software and algorithms needed to make self-driving cars a reality. In 2018, Waymo One, the world’s first self-driving ride-hailing service, went into operation in Phoenix, Arizona, and similar services are in the works for other locations. A technology that is still being perceived as science fiction in some countries has long since become a reality in the US.

Apart from developing the software needed in order for driverless cars to be safely operable, the other challenge faced by the Waymo team was to find a way to keep the cost of the requisite hardware low enough to be affordable for ordinary passenger cars. Waymo met this challenge with great aplomb, in that it reduced the hardware costs by 90%, from an initial price tag of $150,000 per vehicle. Many of these solutions were inspired by technologies that had been developed, but then shelved by European companies, for the simple reason that these companies were too risk-averse to invest heavily in risky 10x projects. Today Waymo is one of the best-known projects of Google X and has received over 3 Billion Dollars in external funding.

10x Blueprint of Alphabet X

A Number of Google X Projects are already in operation worldwide

Project Foghorn

Project Foghorn creates clean fuel from seawater. The method developed by the Project Foghorn team – extracting carbon dioxide from seawater and producing hydrogen via electrolysis using renewable energy sources – worked, but the project was discontinued. In order to be a viable alternative to conventional fuels, the fuel needed to be cost-competitive with gasoline, a goal that proved to be unattainable – plus it was clear that fossil fuels were not going to be phased out anytime soon.

Project Loon

X describes Loon as “a network of balloons traveling on the edge of space, delivering connectivity to people in unserved and underserved communities around the world.” Loon’s balloons provide a wireless network. They use high winds and automatically adjust their altitude to maintain their position over the relevant catchment area. Loon is much cheaper than e.g. building a 4G or 5G Network on the ground. Potentially this could bring Internet at an OK speed to today's unconnected areas.

Project Wing

Project Wing has built a small, lightweight autonomous aircraft that delivers small packages– including food, medicine, and household items– directly to homes in minutes. Created in 2012, Wing has conducted more than 100,000+ flights across three continents. They believe drone delivery will improve the way our cities operate by reducing road congestion and creating new economic opportunities for local businesses.

Project Malta

The main drawback of wind and solar power is that they’re not always available during peak periods of electricity demand – and when wind and solar farms produce more energy than the grid needs, the energy goes to waste. To meet this challenge, Malta, which received seed capital from Bill Gates and Jeff Bezos, enables power from renewable energy sources to be stored as heat inside large tanks of high temperature molten salt and as cold in large tanks of chilled liquid. Kraftblock (a Freigeist Startup) has, in our view, come up with an even better solution that’s based on nanotechnology. But no matter whose solution proves to be most efficient, the fact remains that the world desperately needs new large-scale energy storage solutions.

Project Makani

Wind turbines tethered to kites generate considerably more energy than rotor blades, as winds are stronger and more prevalent at high altitudes. The Makani energy kite was an aerodynamic wing tethered to a ground station. A great 10x concept and several European startups have sprung up in this sector, all of which are members of a trade organization known as Airborne Wind Europe (airbornewindeurope.org). Their solutions appear to be more promising than the Makani energy kite that was discontinued.

Project Verily

Established in 2015 as a subsidiary of Alphabet, Verily focuses on new technological solutions for the life sciences and healthcare sectors. To this end, Verily is developing contact lenses with an integrated glucose tracking capability for diabetics, and self-balancing cutlery for Parkinson’s patients.

10xDNA and China

In China, too, a visionary project is in the works – fulfilling the Chinese dream of realizing an international moonshot. But unlike the American Apollo program, this dream is free of both menial workers and billionaires. Instead, China dreams of becoming the world’s leading technological superpower by 2049, in time for the 100th anniversary of the founding of the People’s Republic. The goal of phase 1 of the project is to achieve modest prosperity for the entire Chinese population by the year 2021. In phase 2, the hope is that by 2049 China’s leading role in the development and deployment of foreseeing technologies will make China an affluent, strong and harmonious country. Making this vision a reality will hinge on the four O’s:

By 2020, they will have caught up. By 2025, they will be better than us. By 2030, they will dominate the industries of AI.

Eric Schmidt, Google

China’s 13th 5-Year Plan

The country’s ambitious goals shall be achieved via a series of five-year plans. For the current 13th Five-Year Plan (2016-2020), China defined ten industrial sectors in which it wishes to achieve worldwide supremacy. By leading the way through educational and industrial policy, they hope to facilitate major technological breakthroughs for electric vehicles, robotics, energy, IT and artificial intelligence.

The Chinese government understands that these goals cannot be achieved without a massive infusion of private capital. Advances for electric vehicles, mobile payments, artificial intelligence and drones are being driven by entrepreneurship and supported by government subsidies, but with little in the way of government intervention. This approach has enabled companies such as Baidu, Tencent, Alibaba and JD to operate on a level playing field with US champions like Google, Facebook and Amazon. And so, thanks to strategic funding of technological startups, China has now emerged as a force to be reckoned within the global tech industries.

The role of the 10xDNA in China’s striving for economic supremacy

China’s 10xDNA is a mixture of utopian optimism and an openness to new technologies, coupled with the desire to generate considerable revenue through innovation.

That DNA has been greatly strengthened by the implementation of a substantial number of next-generation digital platforms. Chinese citizens can now manage their daily lives – from buying bus tickets to grocery shopping to making restaurant reservations – via the messaging and calling app WeChat. Mobile payment is a common modality that all Chinese companies accept unquestionably. A Chinese citizen can even use their cellphone to purchase cut flowers from a street merchant.

Next-Generation Digital Platforms are digital platforms that emerged after the smartphone revolution. Providers such as WeChat or Alipay direct their services specifically and exclusively to smartphone users.

The ubiquity, depth and granularity of these digital conveniences make it much easier for ambitious entrepreneurs to launch new services such as bike sharing and social commerce, given that Chinese consumers have grown accustomed to using these digital platforms – in contrast to European countries such as Germany, where many consumers remain suspicious of e-commerce.

The ByteDance app TikTok is an impressive example of the type of digital platform referred to above. Developed in China, it is now extremely popular and is currently one of the world’s most widely used apps. TikTok’s download figures appear to have outstripped those of Facebook, Instagram, YouTube and Snapchat, and the company is now testing it as a social commerce app. It became so influential in the US that President Donald Trump forced ByteDance to set up a new entity (TikTok Global) with Oracle and Walmart as planned minority shareholders (as of September 21, 2020). The Chinese twin Douyin is another ByteDance service that is far more elaborate. It provides a telling glimpse of where the e-commerce path taken by TikTok could potentially lead. Douyin’s promotional videos are such a good fit within the platform that users often don’t recognize them as ads. The platform features integrated mini programs such as shopping cart buttons that enable users to make purchases within the Douyin app – plus numerous artificial intelligence-supported product search functions, for example product search features which allow you to find the exact products or outfits from a video, and a face recognition app that allows users to identify people in videos and find other videos they appeared in. Pinduoduo, another Chinese social commerce app, enables factories and growers to sell their goods directly to customers without intermediaries. Customers can share products they find of interest via WeChat, and invite friends and family to participate in their product purchases, resulting in higher quantities and higher discounts. Pinduoduo has reaped substantial benefits from the widespread use of WeChat and its integrated payment options in the Chinese market.

But software companies aren’t the only businesses that are profiting from the ubiquity of digital platforms in China. NIO, the Chinese manufacturer of electric driverless cars, offers one-stop solutions on its website for everything related to its cars. The customer can purchase a car via the NIO app, obtain maintenance or service in any desired location via a simple mouse click, and even order battery-charging vans that serve as a kind of power bank.

These are only a few examples of how innovative entrepreneurs benefit from China’s embrace of all forms of e-commerce. The sky’s pretty much the limit – and thanks to the robust entrepreneurial spirit that prevails in China, the seemingly endless possibilities of e-commerce are being recognized, leveraged and implemented to the hilt. This enthusiasm for everything entrepreneurial is stoked by government programs, incubators, subsidies, venture capital financing, and special zones where government regulations allow startups to operate more freely at first. China’s regions and municipalities also compete amongst each other to continuously create optimal conditions.

The resounding success of these evolutions is strikingly illustrated by the Chinese megalopolis Shenzhen. In 1980, fewer than 60,000 people lived in the sleepy fishing village of Shenzhen in Southeastern China. But a mere 15 years later its population had skyrocketed to 10 million and Shenzhen had become the first of China’s four special economic zones. Thanks to strategic government funding and China’s entrepreneurial spirit, Shenzhen has become a global hub for hardware development, with 40 million inhabitants and over 2 million registered companies.

Around 70% of all smartphones purchased worldwide are manufactured in Shenzhen. Huawei (a leading global provider of information and communications technology infrastructure and smart devices), DJI (one of the world’s leading drone manufacturers) and ZTE (a Chinese multinational telecom company) are all headquartered in Shenzhen – as are BYD, which makes electric cars, Tencent, a multinational conglomerate holding company, and BGI, which specializes in genome sequencing. Countless international venture capital firms, accelerators and incubators have representation in Shenzhen as well. For example, the seed accelerator HAX Accelerator provides virtually complete services for hardware startups; and Shenzhen’s Huaqiangbei district is now the world’s largest electronics market. It is a veritable warren of small shops and stands, most of which sell IT hardware of every description. If Radioshack were a district, it would be Huaqiangbei.

But Shenzhen has one great advantage over Silicon Valley – namely an outstanding supply chain. The extensive manufacturing expertise available in the city, plus its low cost of living, are ideal conditions for emerging companies. For example, startups can have a prototype 3D printed in less than 24 hours – and a project that would require a month of R&D time elsewhere is said to take only a week in Shenzhen.

The confluence of government support, efficiency, speed and an implemented 10xDNA has made Shenzhen the world’s Silicon Valley for hardware. And indeed, the rise of Shenzhen is a 10x story in itself, and the Chinese government would like to see this type of dynamic work its magic in other parts of the country too. China’s digitalized and connected citizens are generating mountains of data. It is estimated that, compared to the average American, the average

Chinese citizen spends 50 times more via mobile payment, orders food via apps ten times more often and generates 300 times more transaction data. In other words, China is generating a vast amount of valuable data. The government wants to leverage this incredible data pool to develop new applications for artificial intelligence and smart cities.

In 2017, the Chinese government laid out plans to become the world leader in artificial intelligence by 2030, and a year later launched a five-year plan to provide 500 teachers and 5000 students with artificial intelligence training. Already in year 1 of the program, 100 instructors and 300 students began their training. The program includes pioneering luminaries among its instructors, such as Kai-Fu Lee, who inaugurated the project in 2018 along with John E. Hopcroft and Geoffrey Hinton. Lee developed the world's first speaker-independent, continuous speech recognition system. John E. Hopcroft received the 1986 Turing Award (jointly with Robert Tarjan) "for fundamental achievements in the design and analysis of algorithms and data structures." Geoffrey Hinton (likewise a Turing laureate) is best known for his work on artificial neural networks.

Apart from its artificial intelligence training institution, the Chinese government has also ordered all of its primary and secondary schools to offer artificial intelligence courses. What's more, Chinese companies and universities have been mandated to develop teaching materials – high-quality, freely accessible online courses will be created and numerous academic departments, research institutions and interdisciplinary research centers will be established. If the Chinese government's plan is successful, artificial intelligence will soon be an integral part of its education system, from kindergarten to graduate school. The Chinese people have also recognized the massive potential of artificial intelligence, which they regard as the future labor market. Some Chinese parents are even making their children learn computer programming while attending kindergarten.

But the Chinese government is doing far more than ramping up its artificial intelligence training efforts; a $2 billion national artificial intelligence think tank featuring an industrial artificial intelligence park that will accommodate

400 artificial intelligence enterprises is currently in the planning stages. And the city of Hangzhou, home to the e-business conglomerate Alibaba, is also planning to build a $1 billion industrial artificial intelligence park, with government financing. Alibaba intends to plow $15 billion into R&D, to which end it plans to open seven new development labs in China, Singapore, Moscow and the US. The R&D programs at these facilities will focus on basic and disruptive technologies – i.e. domains such as artificial intelligence, quantum computing and the Internet of Things.

Peking and Hangzhou are only the tip of the Chinese R&D iceberg. A total of 19 other regions have similar artificial intelligence projects in the pipeline, and have entered into partnerships with companies such as Baidu, Alibaba and Tencent. Additionally, the government has formed a national artificial intelligence task force made up of leading Chinese companies, including Alibaba, Baidu, Huawei, Tencent, iFlytek (a government owned IT company specializing in voice recognition solutions), and SenseTime, which develops artificial intelligence software.

The task force members’ various focus areas are as follows:

Baidu: driverless cars;Alibaba: smart cities and the use of AI for urban areas;Huawei: hardware and software infrastructure;Tencent: computer vision solutions for medical diagnostics;iFlytek: smart audio;SenseTime: smart vision.

Since its inception, more companies, specializing in software and hardware infrastructure, cybersecurity, smart education and smart homes have been added to the task force, numbering ten in total.

What sets China apart from just about every other country in the world is that the government, business, and education sectors, along with Chinese populace, are pulling together to make the 10x leap and make their country the global leader in artificial intelligence. To this end, the Chinese government is implementing plans and projects which, in contrast to many European countries, are actually being realized rather than being elaborately formulated only to be shelved. The government is investing vast amounts of money in businesses, infrastructure and R&D. All of this is being tied in by revamping the country’s education system from top to bottom to ensure that China has a plentiful supply of highly qualified professionals. China has fully grasped the crucial importance of 10x.

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