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Silicon Valley trends from an outsider's perspective

Silicon Valley represents a glimpse into the future of our civilisation, writes Dean Gerber.

Over the last four years I’ve travelled often to the San Francisco Bay Area (Silicon Valley) for meetings with technology businesses as large as Facebook and Netflix as well as the smallest start-ups. I’ve gained somewhat of an outsider’s perspective into local life through both work and down time spent with local friends, clients and talkative Uber drivers.

Having spent hundreds of hours driving up and down the famous Highway 101 between meetings, I have always found the Bay area to be unimpressive. One expects to see clear evidence of the trillions of dollars spent on start-ups and earned by tech conglomerates – skyscrapers, expensive sports cars and mansions on every street. I mean after all, Facebook alone created thousands of dollar millionaires when it listed a few years back. Instead, there are 2-5 storey buildings spread out against a drought stricken backdrop of dreary yellow. Everything seems toned down – from the cars that the locals drive to the houses they live in to their business dress code.

The Silicon Valley lifestyle may not be appealing to the average materialistic South African. However, I can say without any hesitation that this area represents a glimpse into the future of our civilisation. I thought that it might be interesting to point out a few trends that I’ve noticed. These are not necessarily tech trends, nor are they all new trends. I am only trying to illustrate the extent to which they are controlling everyday life in Silicon Valley, as opposed to the novelty nature that some of them may still have in South Africa.

Non-religious churches

Surveys have found that the largest religious affiliation in the San Francisco area is “no affiliation”, with more than a third of the polled population not affiliating with any religion. It’s therefore not so surprising that I’ve noticed many non-religious churches popping up all over the place.

These are places of gathering where non-religious people can involve themselves in spirituality, community, meditation, outreach etc. These concepts are still an important part of what it means to be human. Just because one might not believe in God, does not mean that they do not want to be a part of something bigger than themselves; feel connected to anything spiritually or that they do not want to partake in outreach and community activities normally reserved for church-goers.These are often the things that attract people to religion and church, sometimes more so than their belief in God.

Drones

In the last six months, I have met with around five or six different drone companies. All of these businesses design and manufacture drones for different uses – anything from farming, to measuring mining stock piles to filming adventure sport etc. Drones are becoming widely available to consumers as well and are sold in most gadget stores. The plethora of uses for a drone makes this industry a very exciting one to watch, with companies like Amazon even developing drones that will eventually be able to deliver packages to your house.

Lyft Carpool - The Sharing Economy

South Africans have recently taken to the idea of ridesharing through the Uber app. The ability to push a button on your phone and have a driver arrive to pick you up wherever you are has excited us immensely. In cities around the world, including in SA, people are giving up their cars and embracing this new concept.

But this idea has evolved even further. In many cities, Uber and Lyft (Uber’s main competitor) offer pooled rideshare options that allow you to share a ride with another passenger going in the same direction, at a significantly discounted price. As an example, an Uber Pool from the San Francisco airport into downtown San Francisco now costs in the region of $20 as opposed to the $35-$40 that one would normally pay for an Uber X (which is already significantly cheaper than the price of a taxi).

Now comes the part that, in my opinion, is going to change the world. Lyft has recently launched Lyft Carpool in the Bay area (Uber are planning to release a similar concept soon). Carpool allows people who are not professional rideshare drivers to pick up fellow commuters on their route to work and earn money for doing so. For example, you drive the same route to work every day. Another person who lives in your area or on your way to work is also going in the same direction and requests a Lyft Carpool from their phone. The app will pair the two of you and allow you to make up to $400 per month without going too far out of your way. Drivers will then also be able to use the carpool lane (reserved for cars with two or more people). One can only surmise that the ability of this and similar apps to reduce traffic, carbon emissions and the cost of living will be vastly important to the future of society and the planet.

Get Around and Zip Car - the sharing economy

Zip Car and Get Around are car sharing businesses that work on a similar model: Cars are parked in parking spaces all around a particular city, ready to be rented by the app user. All of the cars are fitted with a device that allows the car renter to open the car using either a magnetic access card or the app. Cars can be rented on an hourly basis or on a daily basis and parked back where they were found.

The major difference between the two businesses is that Zipcar owns and maintains their own cars while Get Around rents out other people’s cars. If, for example, you own a car that is only used 50% of the time, you can have the car fitted with a Get Around access device and rent it out to people in your neighbourhood, making money from your car that would usually sit idle. Of course, these apps may not be as viable in a country with significant crime rates like South Africa.

These two services work hand in hand with Lyft and Uber. When you want to go somewhere within the city, you use the rideshare apps; but when you want to drive somewhere further, you use Zip Car or Get Around to rent a car and drive yourself.

The on-demand economy

Much like ordering an Uber at the push of a button on our cell phone, similar apps and websites are taking over from traditional models of providing services and selling goods. This is a general trend in the US and Europe that is yet to become significant in the South African marketplace (aside for home delivery of online purchases). In Silicon Valley, on-demand businesses are on another level all-together. It’s important to point out that these apps are not only revolutionary for the consumer, but also for the workforce, who are able to work as much as they choose and with flexible hours.

Here are some good examples:

Uber eats/Postmates/Sprig: Food delivery at the push of a button.

Eazeup.com and Meadow.com: Medical Marijuana delivered to your door in 20 minutes or less.

Shyp.com: Have an item picked up from your door, packaged and delivered at the push of a button.

Task Rabbit: Outsource everyday tasks and chores.

Heal: On-demand Doctors’ visits to your house.

Electric cars

The first thing I always notice when driving into an office park in the Bay area is the charging stations filled with electric and hybrid vehicles. Fully electric Tesla’s are as common place as luxury German brands are in SA. But what struck me in particular is that almost every brand of car, from Volkswagen to Fiat to Honda, produces a hybrid vehicle. I’d always known about the Toyota Prius, however, the fact that all of the other vehicle brands had at some point recognised the need to enter the hybrid market went a long way toward convincing me that the electric car revolution is far closer than I had thought.

What cemented the idea for me was the pre-launch of the Tesla Model 3 fully electric car a few months ago. Although still relatively expensive with a starting price of $35 000, this is the first car of its kind that will be affordable to the mass-market.  Significantly, Tesla have pre-sold over 370 000 Model 3’s. Now, here’s the kicker: up until December 2015, only 410 000 plug-in electric cars had ever been sold in the US (including hybrid vehicles). You might also find it interesting to know that South Africa was a last minute addition to the list of countries for which Model 3 pre-orders are being accepted. If you think, like many people I speak to, that electric cars are still 10 or 20 years away, then you’re still living under a rock. Almost every car manufacturer has plans to release fully electric vehicles, if they haven’t already done so.

Supporting responsible businesses

In general, people in the Bay area are disproportionately concerned with the business and social behaviour of the businesses with which they spend their money. I would say that in this particularly liberal society, this is partly to do with altruistic reasons. However, it is also clearly because people assume that businesses that treat their employees, suppliers and environment in the right way, are also more likely to produce better and healthier products for the consumer. Of course, being a responsible company is often more expensive and onerous, but enlightened consumers are usually willing to pay the price.

Obviously, this is a concept that applies worldwide and is practised in South Africa as well. But it is interesting to see the extent to which such issues have gained importance in advanced economies and cities like San Francisco. Woolworths is a great example of a local business that has created immense trust among its customers and suppliers alike.

This concept obviously also extends to being a responsible employer and to understanding the things that are important to the modern employee. We’ve all seen or heard about some the common practises at the likes of Facebook and Google. Well, such practises are applied in most of the businesses that I have visited, including: casual dress code; bringing dogs to work; paid admin days; free food; paying to freeze eggs of female employees who want to concentrate on their careers etc.

Lastly, I have also found it interesting how Bay area businesses small and large typically award share options to almost all employees – including lower level employees. Insignificant as these holdings may be, they certainly make everyone feel vested in the success of the business. A few months ago, I saw Julius Malema speak at a business lunch. He spoke eloquently on the point of including the workforce in the upside and ownership of businesses in South Africa. I felt that this is certainly a method that might allow us to uplift our country and economy.

* Dean Gerber is a CA(SA) who works for VAT IT Pty Ltd. He can be contacted at gerberarticles@gmail.com. Previous articles available at gerberdean.wordpress.com

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