happening-hangouts, a player’s perspective

Having engaged a few people regarding these happening-hangouts, I am encouraged to think about how the actual hangout will occur. However, I do not want to fix on the details since I believe this should form from the process of co-creation once we enter into phase 2. At phase 1, we are simple scouting, conducting a feasibility check, checking out the lay of the land, specing the opportunity space. Thus, what follows are ‘visioning’ experiments, imaginary projections of how the experience of ha-ha may feel to prospective players.

encounter film channel

the_encounter

It’s 2020 and there are ha-ha’s on TV, a kind of eco-political reality-TV show. The most powerful is hosted by Jason Silva, where 10,000,000 participants have a couple of hours to decide what to do with $100 million, every week.

Purdesh doesn’t go for that scale of game-show. She thinks it is fake, and what are the chances that your idea will ever end up getting the votes? Nope, she is happy with playing on the net, through various small-scale specialist piped through Youtube channels. This is the real home of ha-ha’s, not TV. She’s particularly interested in film, and she’s party to a longer term sequence of ha-ha’s in the production of a full-length indy feature film. Each week, everything is being decided, from the script up. The direction of the film can be altered from week to week. Like the script of Lost, she’s been told, but that’s ancient history. Because they are rolling it out over a two months, and they are in week 3, there’s a lot to determine. There are other channels which provide more flexibility in terms of changing directors, actors and virtually every parameter of the film production, but the quality suffers in terms of production, actors and so on. This film, working title ‘Encounter’, has been promised TV airtime; one of the facilitators is a si-fi Channel Commissioner, another is a professional producer, and they are joined by the director or writer or main actor.

Purdesh’s contributions have been noted: not only have her votes ended up in the ‘winning’ results, but one of her ideas regarding a character actually won in week 2. She is effectively responsible for a character, a girl called Reyka, and she has been invited to co-write the script as an ‘advisor’. If that character remains, which means further developing the plot, she will remain engaged. She’s written herself into the script.

There are forty-thousand people playing this ‘Encounter’ ha-ha, distributed through three threads, writers, production, and sets (both real and virtual), which is $400,000 a week. Because she is contributing to the script thread, Purdesh has the opportunity to take out some money, but she thinks the experience is worth more, connecting with ‘professionals’, getting her script-writing skills an airing. It’s a start. There are plenty of people who are contributing without taking any money out, so that most of the money goes into getting the best graphics and sets in the sets thread. After all, success for the production depends on it looking good and not just to the 40,000 regular participants. It’s got to have professional standards for a TV airing.

awesomest parties

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It’s 2015 and ha-ha’s are as ubiquitous as kick-starter. There are several sites, but the most popular is happening-hangout.com.

Dirk is plays two ha-ha’s a week. A regular tech-orientated ha-ha hosted by Hermione Way from Techfluff.TV. There’s around 120,000 regulars to the show, and they decide what new prototypes to take to production. Dirk really liked the start-up that came second the previous week, a watch-sized phone, and he’s funded it on the slower kick-starter track. Techfluff ha-ha is one of the most popular fast-track channels. Dirk plugs in to the hangout, votes start-ups he likes on a complementary site, a special instance of the stack-overflow system, and watches Hermione Way and her guests talk about the options. There are usually a few prototypes that rise up initially and these end up escaping from the rest, and the comperes draw Dirk’s attention to those which are lost in the shallows of the long-tail distribution. Several times Dirk has switched throughout the hour when a new item appears.

Dirk particularly enjoys watching how a contender shifts from pure voting to when people commit to making it happen. Teams form as players offer their expertise. Because it is all tracked, reputation is everything. Gone are the days when players would say they would code this bit of the app another design the interface, and then nothing would happen. Big let down. With reputation systems tracking player’s contributions, such gaffs weren’t allowed to happen. Dirk himself had contributed to a few start-ups, producing some short music patches on time, and his reputation stats were building gradually. This made him cautious about offering his skills to the more obvious early winners, contributing his skills to those lower down hoping that they get a final rush. Dirk is currently contributing to several start-ups which didn’t make it to the cut but got enough airing to attract his and other’s attention.

The beautiful thing about these ha-ha’s was that you just didn’t know what was going to arise that night. Techfluff-TV had a policy that once a prototype made the cut, the top three four or five main contenders, they weren’t allowed to be entered again. Others ha-ha’s didn’t have this imposition, and though you had the chance to vote and enable your favourite start-up week-in week-out, it got a little political. Which is why Dirk liked Techfluff. It was light enough and fun enough.

mf_ddp_large

The other ha-ha Dirk participated in was a local one he was heading up himself. He hosted it most weeks and brought in guest facilitators. They had a regular viewing of around 200 players. So they were making weekly decisions for around $2000. It was a local network, mostly his school friends, but there was a mix with friends, students, parents even. They had upgraded a local community centre, put new tablets at the local primary school, but most of the winners involved organising some awesome parties. It was becoming so regular, it was starting to get boring, which is why Dirk was inviting this guy Girvin from the coast on the show this evening. Girvin was a player in a local group in his home town, and he had been funded to come to the big city and drum up interested in a big party, more like a festival.

Dirk didn’t really care where the money went. A lot of the suggestions didn’t involve much money, and he’d roll it over to the following week. He was never very interested in where his $10 went, even though it was all transparent. As a host of his own ha-ha, he realised what a hassle it was to redirect the money to those who needed it to fulfil the chosen activity. It was a head-ache deciding who should get what when the activity was chosen. He’d like to switch to the other mode of money-flow which didn’t centralise with him, where players simply directed their entrance fee directly to those who made a claim for it. But his friends were lazy bastards and they didn’t want the hassle. Looked like other ha-ha’s managed it, and most of them were older. They could deal with the higher level of trust and the responsibility to ensure the money got to the right people. It was just a higher level of granularity of respect, something which Dirk wasn’t interested in himself.

purplebeach happenings

2013, and ha-ha are being trialled for a few weeks. If they don’t hit 1,000 regular players, whether in one ha-ha or across multiple ha-ha on the happening-hangout.com site, the experiment would be over.

Screen Shot 2013-07-31 at 23.25.33

Annamie was asked to host a ha-ha with her network. She put out the invitation to her friends and colleagues. The challenge was simple: $10 and one hour to make a decision about what they could do collectively with $1000. A friend was interested in the process and agreed to guarantee the first show of $1000; regardless of how many people turned up, the amount to be decided about was capped at $1k. No pressure for Annemie. If people didn’t pay their ticket, it didn’t matter, so she felt relieved that she wasn’t ‘selling’ anything to her network.

The people who wanted to take part, booked a ticket, and they were informed when the happening-hangout was going to take place, and their requirement to have a quora.com membership. Most players turned up 5 to 10 minutes early, though the hangout was open 30 mins before it began. Various technical hitches were overcome before Annamie, Stephan and David were engaging on the hangout, and it was broadcast live on air. They would splice the youtube recording with views of the quorum site for viewers who wanted to watch the show afterwards.

During the show itself, the three facilitators were kept on their toes by the various suggestions offered by the players. At first the contributions were rather slow, but Annamie suggested some alternatives and Stephan himself wrote up his idea which got a lot of traction. Half-way through a suggestion triggered off a flurry of activity and the facilitators had a hard time simply reading through the offerings. It was like a chain-reaction, and though it flustered Annamie, David was laughing. It didn’t matter what they thought, since the system would take care of itself.

They had three main contenders towards the end of the hour, and the tables were turned as David pleaded with everyone to vote only for one of them. The true power of the system was that they reached consensus. They could always try another activity the following week. What was important was that they fully realised their power as a collective, aligning to one target. This wasn’t politics. He didn’t want anybody to feel that they were ‘losers’ because they had just been pipped by a few votes. It required self-discipline. The vote swung suddenly in the last minute when Stephan made a startlingly simple observation about one of the activities, how one naturally led to the other.

They money from ticket-sales, $860 was put forward to the next ha-ha which was to be hosted by another facilitator and populated by another network. There was an open invitation to the Purplebeach participants; how many of them would return for the following week’s ha-ha? A decision was made to stick to the ‘gift-it-forwards’ system initiated by Annamie’s friend: ticket-sales paid for the following event, not this one. Thus, it was up to the participants to invite new players in order to increase the amount they would play for in the following week, thus taking the edge off the necessity to invite people for this coming ha-ha. It felt healthier.

provisional mock-up site

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This is what the mock-up looks like. The real one enables participants to host their own ha-ha’s, as demonstrated by the above ‘visioning’ examples. We have a open-hangouts planned for each Monday through August, starting on Monday the 5th at 7pm BST.

the math of p2p economics

Using a relative-value algorithm, SEA (similar to Google Page Rank), social accounting is simply a matter of tracking subjective enumeration. Value is enumerated by each person, and it is not ‘abstracted’ or ‘shared’ or ‘transacted’. Reading this article, for example, you evaluate it as 3 out of 10. This is just one evaluation out of all the evaluations the reader comes up with during a day’s living, whether it is enumerating the contribution of colleagues, foodstuffs, even the weather if they want. Thus, the reader accumulates a ratio of subjective enumerations. By applying the relative-value algorithm, a ‘priority list’ of evaluations is derived — without any external bias. In a pure p2p network, there is no ‘objective’ or ‘externalised’ enumeration, and thus no currency. It really is as simple as this; it worked for google, and made the internet navigable.

how do you go about evaluating?

Let us look more closely at how a person evaluates. In the example above, the reader gives the article a value of 3 out of 10. What are they estimating to have a value of 3?

  • the reader is rating the article
  • the reader is rating the article’s author
  • the reader is rating their reading of the article

These three interpretations derive the quality of economics. In the first, the reader is evaluating a thing, in the second a person, in the third, their own experience. The first interpretation encourages the thinking that all subjective enumerations of the article can be totalled up and an average value derived, much like the totals for eg Amazon seller. The second interpretation is the operating interpretation of ecosquared, which emphasises the importance of a pure p2p evaluation system; things like articles and foodstuffs and so on conform to a resource economy primary based on sharing. The third interpretation essentially tracks gratitude.

All three are valid, and books will be written to share how one goes about evaluating one’s subjective enumeration. After all, some evaluations will lead us to saving this planet from environmental disaster, and other evaluations will continue the degradation. As a pure value-game, it is left up to each and every individual, as it should be for a p2p system.

where does money fit in?

To shift from our current system of an externalised unidimensional accounting system, that is money, to a multi-dimensional social accounting in a pure p2p system, we need to examine the parameters of our current economics. Money has evolved from a basic coupling of number-thing, and yet it is only functional in time, eg using the £10 I received yesterday to pay for something today. Because the basic application of number to social accountancy in money does not contain ‘time’, various ‘add-ons’ have evolved such as interest and compound interest, and with the application of negative number, our current economics is unstable. MTTP, or Money-Time-Trust-Protocol, decouples money-thing and replaces it with money-time, eg £10 is roughly equivalent to an hour. Money thus becomes “well behaved” in a mathematical sense.

Thus, we can invite people to co-create value using the MTTP social contract whether £10 for an hour or £100 for a day or £1000 for a week and so on. It performs the same function as ’employment’: participants have a guaranteed source of income. Notice, there is no bounded entity, no company or government or organisation; MTTP is a purely p2p protocol. The relationships of dyadic p2p contracts constitutes the economic structure of the network. Once the value is produced, and if this attracts money (ie is ‘sold’ using traditional economic parlance), the money attracted is distributed by the ratio of subjective enumeration of each participant member, via the Subjective-Enumeration-Algorithm described above.

the subjective-enumeration-algorithm

The actual algorithm for tracking subjective enumeration looks something like this:

(where V is the value of any person i, d is the “damping factor”, N the total number of people, M the set of people who evaluate person i, the value of Pj at time t)

Check out the math in this document, for both MTTP and SEA.

current p2p foundation engagement

These two protocols/algorithms establish a pure p2p economics, social accountancy with no organisational boundary, no centralised or abstracted authority, and it works for small groups or an entire planet of co-creation. Inherent in this system is the subtlety to educate people to evaluate ‘correctly’ if we wish to engender a sustainable global situation.

Having engaged Tiberius Brastaviceanu of Sensorica, the solutions presented here undercut the level of complexity his community is dealing with. Tiberius is employing a characteristically engineering methodology to the problem of social accounting, attempting to specify all the factors to evaluate an objectively fair % distribution of ‘value exchange’. Who determines the right factors and their evaluations? If there is any ‘externalised’ or ‘authoritative group’, then it is not a pure p2p system and politics rears its ugly head, which is why Sensorica are still struggling with deriving their accounting system that everyone is happy with. Imagine this expanded to the global level. No, the accounting system must be a pure p2p system, as efficient — and perhaps more so — than our current p2p system that is purely based on the unidimensional currency that is money.

experiential iterations and social niches

The word ‘iteration’ has been used to describe the different attempts to put the financial protocols into practice, the fourth of which is the happening-hangout. Let’s reformulate this language.

iterative experiences relative to self

I, David Pinto, have been using the term iteration in relation to my own personal experience. After the first attempt, the birthing of the economic entity in 2012, the team wanted to continue with regular meetings at the Hub. I did not see much future in these, but attended a few. I am not into community building just for the sake of community building. I see this as one of the errors of how we self-organise; before you know it, we are supporting the continuance of social entities that have long-ago surpassed their use-by-date. Most of our social institutions, and indeed cities, suffer from this.

From birthing, I went ahead alone by approaching advertising agencies, and when personal issues intervened later in the year, I delimited my efforts to writing a book, which I have termed the third iteration. As you can tell, this is a personally relative sequence. However, what becomes clear is that different scales of social niche emerge, and it is these that may constitute our collective self-organised strategy.

social niches

The following modes of social experience, or social niches, may help map out the self-organised strategy involved:

  • information: this website, blog, explanatory videos and prezi’s, the book
  • synchronous pairing: tango, textango, MTTP, gems
  • dynamic network alignment: action-cycle, happening-hangouts, SEA

There is a tendency for all initial business engagements to collapse back into an information-exchange. As we know, MTTP departs from the notion of exchange at source and is primarily based on setting up a scalable, synchronous, social experience: money-flow and co-creation first, then evaluation, information etc based on shared experience. MTTP is a financial protocol which embodies the new methodology.

1-s2.0-S000510980900435X-gr10

The new methodology is based on social risk, on play, on not-knowing, on trust. By aligning to a future goal, even if it is as short as an hour or a week, we have something concrete to talk about: to iterate experientially, socially. Otherwise, we fall back into the attractor of what we know, what we can reason, what we think is possible, and so our current system of social paralysis continues.

alone, paired, and collectively

We will go into some detail regarding these three in subsequent posts, suffice to delineate the various scaled ‘projections’ in our ecological economy, as they map to the ‘social niches’ described above, from individual, paired, to small teams:

  • writing fictional narratives (to embody ecosquared financial protocols and their underlying methodology based on giving)
  • engaging the front-line of business (gifting companies, advertising or otherwise, with ‘gems’)
  • opportunistic and receptive meetings (the ‘water-cooler’ effect expanded into all social spheres, to realise social serendipity)
  • birthing the ecosquared entity (attracting a seed fund of around £10k per person in order to play at the ‘organisational’ level)
  • hosting happening-hangouts (monetising social media by actuating the latent potential in our networked relationships)
  • conducting action-cycles (to increase permeability across businesses, government, educational boundaries)

 

explanation-exploration for the proposed happening-hangout

Our current system favours the talker, the entertainer, the wilful person, the persuader, the extrovert and so on. Although we have come a long way, I am fairly convinced the amount of money that flows to those we really value is not high enough.

I have not heard anyone say anything that is outwith the current economic paradigm that isn’t literally about giving things away for free, eg freecycle, various share movements, and all sparked (at least in the last few decades) by programmers sharing code. But the current system can go on quite happily, money laundering its way through the degradation of the natural world, while a bunch of people “buck” the system. It tolerates sharing within the family, for example; it tolerates a certain amount of political and even economic dissension.

An alternative economics, one based on giving — and yet still using money we use nowadays — will produce a different social effect, which may enabling us to be generous, for example, and to value that which we hold dear to us the most: our loved ones, the environment; listeners, contemplators, quiet, loving, careful, open-minded, equanimous people.

designing the happening-hangout

If such an alternative economy exists, the way to prove it, is to test it. That’s the point of the ‘happening hangout’. So, if we set up the happening hangout to reflect us well, and the moneyflow ends up with those we individually and uniquely value; that is, the facilitators get ‘paid’, and more people want to take part. We need to get a result in one hour. I am going to give the experiment a test run of four happening-hangouts, with the end-goal that we have 1,000 people who are wanting to ‘play’ for £10-hour. That means, we are making a collective decision about £10,000 on a weekly basis.

Is this possible? And if so, how?

The question that may come to my mind is, which way does the money go? Does this sound like an odd question to you? It may be, but can we answer it anyway: does the money go outward or inward? Does it go out to the people who are joining it last, or inwards to the people who host, who have done this before?

Traditionally, money goes to the centre, it centralises to kings, governments, banks, companies. Does this suggest that in our alternative economy the money actually goes outwards to the periphery, branching to more and more people, that it becomes diluted…? If this moneyflow was to ever coallesce again, then it would be done by peripheral individuals redirecting the money to those people who they thought deserved it, people they valued. This, actually, is a variation of the Invitational-Protocol.

I am not sure at what stage we are at in the world, whether we can initiate such an IP with the first happening-hangouts. It may be more sensible to think of it as a trust game where participants are inviting the facilitators to play the game, like inviting a referee to steward a football game. Once an activity is decided on, the moneyflow goes to where it has been decided. The fact that it does indicates the trust we have in the facilitators. It is important that all MTTP flows onwards to other people, and the facilitators never take any out for themselves. Their payment must rely on the consequence of the social result of the event.

parameters of experimentation for ha-ha’s

Imagining a state where happening-hangouts are actively springing up with thousands of players, what will distinguish ha-ha’s will be the different flavours of experimentation, whether they are geo-local, what protocols the facilitators use in their engagement, the overal timing of the hangout, and the external apps used like quora, the direction of money-flow, the ‘objective’ of the ha-ha, and so on.

When inviting a bunch of people to a meal, we want to cater for different tastes. My brother had a rule-of-thumb, relying on a few stable dishes he knew how to cook, and add an experimental dish. A level of experimentation is encouraged for every hangout.

If there are enough of us playing these games, we will hone in on few distinct systems that enable different results in the real world. The important thing is that the feedback loop to determine what works is determined not by thinking, but by social impact. In this way, we do no try to ‘isolate parts’, specific people, specific protocols, specific numbers of people. It is very much a ‘wholeness’, and what solutions we evolve are systemic, not at the level of any individual part.

But this is jumping the gun. We definitely need to produce the first set of ha-ha’s that simply work — as good as, if not better than ‘working’ in a company structure.

phase development of ha^2 as interlocking s-curves

phases as interlocking s-curves

Phase zero is coming up with the idea.

Phase one is sharing it, and seeing what people say, who is interested, feedback, gentle awareness. Conversational. This is the stage we are at now. This attracts potential designers, facilitators and contributors, and is on-going in subsequent phases since the entire process is open.

Phase two is inviting the self-selecting team to design the basic DNA of the first ha^2. Who are into open design? Who independently see value in their vision of what the ha-ha could be? What is the basic DNA of the first ha^2? It’s dealing with the mechanics, the software, as well as provisional design of hangout engagement between facilitators, and so on. This will continue as an iterative cycle of evolution in subsequent phases, but we need to have a provisional first game fit for play.

Phase three is the actual embodied experiment. This will require the designers and the facilitators to commit to one or all of the first run of happening-hangouts. Provisionally, it will be a run of four ha-ha’s.  We will need some people who are connected enough within a network that by their invitation, we get plenty of people to trial the system. We can not enter into this phase unless we have all the necessary players.

Phase four, what to do if it works? In order for us to enable this, the first website design must have a provisional plan for growth. That is, for example, the ability for participants to start hosting their own ha-ha’s and allow their networks to crowd-fund them. This may even involve ‘companies’ at some stage using this platform.

time-scale?

The first phase arose over a few weeks, engagement with people like John Kellden, Gregory Esau, Joris Claeys, Bert-Ola Bergstrand. The second was sparked inadvertently a week ago with Michael Maranda which has led to an open, though not particularly well-crafted, invitation. Some incredible engagements with people, like Alex Gagnon, Alexandre Enkerli, Willi Schroll, Anna Blume, Joe BreskinGrizwald Grim, Susan Cox, and Michael Layne Hartsell. As usual, this is piece-meal. Those who happen upon it, who recommend, who are interested. I will give this period a couple of more weeks. I will be calling for phase two mid-July, and the actual trial to start in August. However, this may all slide since it is summer, so that the experiment is conducted in September. We’ll see, depends on whether there are enough open-designers (which reminds me of meta-designer John Wood) who catch the vibe.

stocks and flows

Something intelligible from this article by dymitri:

Joan Robinson frequently recounts that the great Michal Kalecki once exclaimed to her “I have found out what economics is; it is the science of confusing stocks with flows!” The trouble with the flat earth economists, is that they confuse the dynamic flows of production and consumption that make up an economy with static piles of stuff. Robinson further reasoned that “it is this confusion that has kept the Quantity Theory of Money alive until today.”

With ecosquared, we separate money from things, ie a quantisation of things. The closest we get to this is the cumulative relative values from SEA. That is, Gary may be highly valued this month, and so he gets more money flow. In the current ecosquared system, there is no numerical application of subjective value to things. Will this evolve sometime?

A parallel system will evolve to keep track of things, much like books in a library, so we know who has what at any moment, and there will be a relationship between the value we produce for one another and the sharing of things. Can this should be conducted through our personal relationships, simply sharing with one another, like food around a table?

Not sure about the equation in the article. Seems too simple by half. Nor the political biases. The interesting bit remains in separating flow from stock.

flow_stock

This is a classic economists understanding of stock and flow. This diagram indicates that business or economics is the flow of things. So, the number of things that enter the shop through the back door, the inflow, the number of things that leave the front door, the outflow sales, and the stuff that remains on the shop shelves, the stock. This could also apply to the movement of people, and not just in the sense of slavery. Over time, companies are ‘stock’, where the ratio of inflow and outflow of people delineate whether the company is growing or shrinking.

Ecosquared has a slightly different interpretation of flow and stock. Simply, the flow is to do with the application of number to time and people, ie MTTP. The stock is the real world stuff we share. How is the stuff we share regulated? How can we distribute the stuff in our shops without ‘money’ as an intermediary?

At this point in ecosquared, money is attracted to the value participants produce and distributed according to SEA. This money can be used in the traditional way, buying stuff. As the ecosquared entity grows, and entire communities are running with MTTP and SEA, where there is no ‘external’ attractor of money, how do the distribution of goods get divided?

No answer to this yet.

 

subjective enumeration

These green dots represent value created internally. This may mean the building of some prototype, computer or physical, producing some designs or some music, or growing or cooking food, or providing some tools or advice. It is all about experience. This is not about money or things. It is about experience and what people offer in terms of resources.

The evaluations given above are not a substitute currency. They are subjectively enumerated values. This replaces the need for money. They are a record of how valuable people see their engagement with others. There is no absolute evaluation, no “objective” or authorative enumeration anything close to money.

The maths based on this might be interesting, the distribution pattern of a person’s evaluation over time, the mean and so on. It might be possible to see who is producing most value, in the eyes of others. It might even be possible to apply the value algorithm similar to google page rank. Consider the initial starting position:

(where V is the value of any person i at time 0, with N the total number of people)


And the iterative equation which tends to a relative value of any person to any other person in the entity:

(where V is the value of any person i, d is the “damping factor”, N the total number of people, M is the set of people who evaluate person i, the value of pj at time t)


Such an equation might highlight particularly “valuable people”. It might also be used to root out those individuals or cliques who are gaming the system, producing “fake value”, who are in it purely to take advantage of the doubling protocol at the boundary entry.

This kind of equation is something that will be useful for sure, and will evolve over time, as the entity evolves, just as google’s page rank algorithm has. Nevertheless, it is essential to emphasise that the design of the entity has its own values (mine I guess;), and that is for equality. These are merely number games. What happens in the real world is what matters. Whatever equations we produce that play with subjective value is gameable only in the sense that we use the equation for us to highlight those people whose work, effort, insight, we actually value. It is hoped that gaming induces a positive value.

Play around with this simple mock-up of a relative value system on gdocs. Barny ends up making more than his equal share because of the relative values of everyone else.

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Which is why so much effort is being made to design the outer boundary as self-enclosed as possible. If the outer boundary that constitutes scalable invitation, MTTP, has its own sustainable “income”, it means that everyone within the entity has at least the money they brought covered, and if the entity is healthy, then they are guaranteed to double the money they brought. At whatever level of scale, this entry guarantee is a healthy living, individually, in current 2012 prices. It gives those within the entity the best environment for them to produce value, simple, without the need to make it commercially viable, and thus compromising their ideals and ethics and design to “fit” the current organisational situation, the mess of bureaucracy and money-making directives.

 

[See also this description.]

following the money — and leakages!

Although we are employing new financial protocols and shifting from money-production to value co-creation, there may be some value in examining what the current moneyflows are with our tradition system of exchange and taxation. We have a simple algorithm to track subjective enumeration, whereas in the current system our money is distributed in a complex network of exchange including governmental taxation. So, how do we go about tracking where the money goes? Let’s follow the money!

Let us track how money moves based on some simple items:

  • apple (natural things which grow in the uk)
  • banana (natural things which grow somewhere else in the world)
  • wooden toy (made in the uk)
  • electronic gadget (made somewhere else in the world)
  • beer (made and distributed throughout the uk)
  • petrol (imported from outwith the uk)
  • laptop (manufactured and bought from another country)

So, the first six items are bought and sold in this country, whereas the last is bought from a trader outwith the uk.

Some generic questions which may guide us in determining where our money goes:

  • how much goes to the company?
    • how much to the employees?
    • how much for logistics?
    • how much for buildings and shops?
    • how much goes to owners as profit dividend?
  • how much goes on tax?

apple (natural local produce)

A bag of apples from tesco cost anywhere from 21p per apple to 30p.

How is this money distributed? If Tesco gets 21p of my money for an apple, who gets this money? I’d like to think that the check-out person and the shelf-stacker got some, and the people who transported the apple to the shop do too. There may be intermediary markets, but let us consider that tesco has a direct relationship to the farmer — how much do they get for the apple? And in terms of the farming, how much goes to the farmer, and how much to the farm-hands who harvested the apples, and indeed, how much goes to the people who sowed the seed in the first place? Then there’s the tax — what are the tax points? Each employee is taxed, the transportation is taxed, are there any points for VAT? And this apple may benefit from government subsidies, and may even benefit the owners of tesco in terms of “profit”.

We can not get into such extreme detail, but it would be instructional to get as much of a system answer as we can. After all, it would be nice to know how everyone is remunerated in the supply chain from the apple tree to the specific apple going into your mouth. We are particularly interested in seeing how money flows between individuals and organisations and between organisations. We are interested in noticing if there is such a thing as “leakage of moneyflow”, such as we find in water loss between the reservoir and our taps (which incidentally ranges from 10% for efficient cities to 50% in poorer countries or those countries with aging infrastructures).

These questions are beyond our remit here. This is our first iteration. We need ball-park figures. Looking at Tesco’s Annual Report 2011 and 2012), we can gather some simple figures:

  • in 2011, revenue per fulltime equivalent employee in the UK was £200k
  • in 2011, profit per fulltime equivalent employee in the UK was £15k
  • in 2011, (corporate?) tax was £0.9b
  • in 2011, actual fulltime equivalent employee wages and salary globally was £15k

(A passing note: the accounts are static. Wouldn’t it be more useful to have a live, dynamic database, and one could query specifics? For example, I had to calculate the last stat myself based on the numbers in the reports. Accounts should be a searchable and dynamic system — and this is exactly what we will have with an ecological economics system. It is as feasible as the trick that Google has performed, conducting a “live” (or daily at least) search of the internet. We have the opportunity of replacing our out-dated static financial account, with so much static corporate structure, with a dynamic con-current event, and any query is a live instant. We are replacing static complexity of corporate structure with a dynamic p2p complexity.)

A basic way of interpreting the numbers is that out of the network of people who comprise Tesco, say 200,000 fulltime-equivalents in the UK, each person helps generate a revenue of £200k, thus generating the full revenue of £40b for the network in 2011 in the UK. In the current system, salaries range from £15k to £15m for the executives (there are pages of stats on the remuneration of directors and executives and it is not entirely clear what they earn in sum), which derives a financial gearing ration of 1:1000. But there is a problem in how this money is distributed which can be shown through a simple game.

You have a cake, and you give it to two children equally. How do they do it?

The answer is, as you probably know, the person who cuts it is not the person who chooses which slice they get. The chances are, the person who cuts it will then cut it as fairly as they can.

Of course, this reality-experience can get more complicated when we increase the number of participants beyond two, opening up potential politics — but what we are looking at here is a system which encourages fairness. And in terms of Tesco and most companies, the individuals who are deciding on who gets what slice are the individuals who are cutting up the cake — they cut the cake and get first pick of the slices. And even the board of advisors brought in to regulate this process are mostly executives from other companies. We have a kind of “executive aristocracy”. Fairness will never evolve from this set up.

This is not to say that we want a complete equality in the distribution of revenue. After all, some people are making decisions that are resulting in massive gains for the company, deciding on the location of a new store, for example, down to, deciding what items are packed in what shelves. So, it is reasonable for some individuals to be remunerated higher for their efforts, insight, genius even. But wouldn’t it make more sense for this to be evaluated by people, and not by position? I wouldn’t mind knowing that someone attracts £15m because their decision led to all of us benefiting by billions. Such individuals would be the distributed executive.

So, ecological economics enables this. Not only in terms of the choices people make about who they invite (using mttp, the equivalent of a secure income), but also how they evaluate one another’s engagement (using sea, the distribution of profit).

A final observation, the amount of organisational complexity of Tesco is extraordinary. I read once that supermarkets were one of the modern wonders of the world for its sheer complexity. P2p networks based on technology provided by the internet (which is simply an application of Tim Berners-Lee’s http), promises an equivalent complexity and richness without the artificial complexity of proxies such as “companies”. One concern that comes to mind, however, is ownership, or what companies’ term assets. Can such a rich networked complexity occur from individuals “owning” specific trucks or even “isles” of the supermarket in the same way we have gardeners of wikipedia pages? I do not think we are currently capable of this scale of social self-organisation, no matter what the expert pundits say. We need to learn how to trust one another, to be able to engage in consensus dynamics, otherwise any hope of large scale p2p networks will collapse under its own inefficiencies.

bananas and other produce/products

It will not serve us to examine the other produce as we originally set out. We are not in a position to track the chain of supply for any item, apple, banana or computer. Can we even answer what happens to the money for a 21p apple? From the crudest interpretation, the apple represents the revenue of Tesco, which means that 1.5p goes to the checkout person (as a representative of all employees), 1.5p goes to the owner, and the remaining 18p goes… somewhere else? We can say transport, property etc etc, but if we were to examine the costs for this, eg the cost of a new truck, we would simply see that money would be going to the people who made them. Like the question about the world and turtles, the economics world is held up by employees, and it has employees all the way down.

Petrol does remain interesting. Even a cursory look at fuel costs, we can see that the situation is rather extreme. I just paid 135.9p per litre, of which about 49p goes to the fuel importer and 5p to the garage you buy it from, and a massive 82p goes to the government as duty tax as well as the recent addition of VAT of around 23p. Astounding. Terrifying.

A milestone for ecological economics will be to apply the protocols to mapping petrol costs. Although the government is getting an astounding amount of money from drivers, they are in effect subsidising a huge number of businesses by maintaining the road infrastructure. But even then, I don’t think that justifies such a large cut of people’s hard-earned cash.

experiments in virtual communication

I have been playing with different formats to explain what ecological economics is about. Here’s the latest:

You get to hear the speaker, in this case Michael, as well as read my response. It seems to be similar in format to jaxing, where we align as listeners. Something like this exists during live conferences, where people have muted conversation on twitter for example.

Along similar lines, I have been experimenting with capturing live writing, as well as being sensitive to the live reader, for example:

Other experiments have involved producing slideshows, eg:

 

After an interesting conversation with the rather remarkable Tudor Tarlev, I am encouraged to produce explanations for different people. A few slides, a short video. For graduates, fathers, financial experts, and so on.

second iteration of ecosquared

Second iteration has gone relatively well. Though connection to Gerald Walker at Bloomberg Ventures has been lost (and he was the first person I met after 25th April’s birthing), and Robert Bennet at Haringey Adult Education seems to be a little lacklustre, I have had a series of engagements with people which have been rather exciting. Consequently I feel I am getting better at articulating what I am up to across a range of sectors and framing the particular aspects of ecological economics.

 

high quality engagements

The primary vector is in the marketing and advertising industry. Spoke to The Future Factory, who appear to be playing around with similar business methodologies — they broker the relationship between agencies and new clients. They approach new clients to find out more accurately what problems they face, and they then translate this to their agency in order to produce a bespoke campaign. That is, they occupy the boundary between these companies. Dan at the Future Factory couldn’t quite see what ecological economics was, and did not see the benefit of my observation that they should not be attached to particular agencies, but instead broker relationships between clients and agencies, suiting up appropriate parties responsively — that is, strategically occupying the middle ground rather than as an extension of a specific agency. The reason for their current set-up, of course, is that they are paid by the agency thus deriving financial security.

Had two points of contact with Z/Yen, a financial sector think tank and consultancy. Michael Mainelli was generous and warm, and we mostly focussed on his book The Price of Fish which had some remarkable insights around the financial mensuration of environmental responsibility, something they call Long Finance, and many interesting if not awkward questions eg how government should start thinking about deriving tax from internet traffic, ie tax? In the end, I was only able to hint at ecological economics, and I really wanted to pass on Pam’s observation of mttp as a time-machine — what happens to relationships and money at the “top end” of mttp when we are dealing with eg £100m for a millennium — surely this was Long Finance at its finest? But I am not practiced with standard freelance work practices, which essentially boils down to “look out for your own”, and so his offer to keep me in the loop by inviting me to events is nice but does not further things directly. One day I shall be faced with the problem Michael faced with me, which manifests as a reluctance to actually examine new things; this takes time and effort, and essentially, is a complex task if done responsibly.

The conversation with Nick from Z/Yen was totally different, with an argument ensuing towards the end. It came down to a straight confrontation — what do you do when faced with something you do not understand? Dismiss it, or examine it? I said I required people to seriously engage with it, for the first people who do will be ahead of the game. They will be trend-setters, the first in a new field of economics. Nick said he would look at it in August with the potential — should the subjective-enumeration-algorithm stand up — to approach Michael and ask for some investment in terms of time and money to examine the money-time-trust-protocol, and create some kind of proposal, feasible clients for funding, and some specific test cases to establish its use in the real world.

In Edinburgh, I had a second engagement with Ken Dixon from Newhaven, a creative agency, and it went very well. We talked a little about where I was with ecological economics, more specifically about the state of virals, and then offered a specific idea which he liked a lot.  We talked about money and he said he would talk to his partners the following day. If the idea generates significant moneyflow, it shall be the first, and how appropriate since the idea emerged between Harriet and myself when we were considering Amber — the inspiration for ecological economics in the first place! One can’t write this material — it’s got to be lived! But… he has not got back to me over the following week, but I put this down to crap virtual engagement — our real world engagement is strong. I also spoke to a couple of other agencies, one of whom was willing to meet without even an email or site visit; the words that caught him were “shifting from company push to client pull”. Another very interesting, high quality engagement, even though I admit I am only a visitor to their industry and I do not wish to take over a position in their company or compete against them as another creative company. I feel confident I can do this with London ad agencies in September, if there is a need.

Also had a very high quality engagement with Sarah Deas, chairperson of Co-operative Development Scotland. Framing this conversation was quite a trick, and I think we did pretty well. I made it plain that the problem with the entrepreneurial scene is noise, and the tendency for the money to follow the “talkers” and those who can fit the tender-commissioning process best. All that I asked for was that what I presented and who I was had enough quality to justify further engagement, specifically an invitation to meet with others to test the protocols and algorithms. I feel confident about speaking to executives, individuals in positions elevated enough to be able to see the bigger picture. Usually such people can not bring themselves to look at small scale investments and projects, because they are essentially employed to make decisions about the whole organisation, which involves millions of pounds. The scalability of traditional business is built into the hierarchical structure which is static (at least people hold positions for years, and roles often last for decades), which means that sensitivity to present conditions, receptivity and responsivity is sluggish.

Had useful engagements with Dug, a lawyer who is diving into the entrepreneurial world after just conducting an mba, Lynne and her friend’s children who are graduates, and Sofia and Mamading of London Creative Labs — who actually use action cycles in their programme. The potential for graduate “training” in ecological economics, generating revenue as they go along, is high. A good way forwards is to anchor it to some council service, eg Haringey or Lambeth, offer a scalable accreditation system of collaborative entrepreneurialism, employing Mozilla Open Badges technology. The money comes not from the council, but from the companies we produce value for, which results in greater revenue for them. I’ve touched base with Darius of the Spring Project, and we hope to connect at the end of August.

 

five strategic fronts

So, there are five fronts to ecological economics right now. First and foremost is the engagement with the ad and marketing industry by way of selling ideas or “adverts”, the potential methodology of aligning to genuine social viral movements to be mutually beneficial for social artists, companies, and social services, and leading to macropatronage, a real game changer. This hangs on my engagement with Ken, Craig, and any other ad agency guru that can make use of my services. Objective: sell a couple of ideas, see them being implemented, and accumulating value in terms of the agency itself, specifically quality product/service improvement and new revenue generation; this translates as mttp contract of £100-day per week or £1k-week per season.

Second is the grounding of the financial protocols by professionals, especially getting the stamp of approval from Michael with respect to his Long Finance enterprise. This mostly hangs on my engagement with Nick and Michael and their connections. I have also started to connect with Michael from Nesta. Objective: serious examination, feasibility funding, introduction to high level players; this translates as mttp contract of £100-day per week or £1k-week per season.

Third is the graduate program, which involves attracting switched on people to actively pick up the ecological economics business methodology and implementing it directly. That is, a few people coallesce around specific gems, and turn them into revenue in ludicrously short periods of time. This hangs on Lynne, a genuine entrepreneur rather than a book-read or theory-driven one, and London Creative Labs, and perhaps Robert at Harringey, and Darius of the Spring graduate programme. I’ve tentatively named this the “Up-Grad”. Objective: scalable accreditation program implemented in council and at entrepreneurial hubs, attracting graduates and otherwise who are trying to find jobs; this translates as £100-day per week depending on third party investment.

Fourth is executive engagement. It is important I get meetings with individuals with high enough elevation to get the ideas and myself on the radar; as far as I can tell, they are in a position of being able to see the global landscape currently and over the next decade or so. Thinking of chairs of organisations like Nesta, Unltd, Boris the Mayor, Richard Branson, Jamie Oliver, Tesco Head, etc. Objective: initial meeting facilitated by results in the field, followed up by high level action cycle with a final long term objective of seeing sea and mttp implemented by google; this translates as £100-day per week by locating the various ecological economics initiatives in their respective geolocations.

Fifth, is the actual network, which we can call confluence collective, of everyone participating to generate moneyflow. This includes the graduates, unemployed, self-employed, adult-learners, hub-members, and everyone who is starting to adopt mttp and dmp financial protocols as a collective. This means that the tracking of money flow must be sorted out, something a little better than the google docs I have set up so far. Objective:  revenue generation from converting ecosquared gems ploughed into people who can improve the actual logistics of ecological economics; translated as dmp in the order of £100 per week.

 

third iteration

I need to secure moneyflow. From any one of the fronts mentioned above. This is imperative. The value is obvious now, money should start to flow, which means a corresponding increase in implementation so we can make some headway towards some of the more lofty ecological economics mechanisms such as macropatronage — which promises to be a real game changer in social media and business. But we need evidence now.

These current iterations follow from the birthing event on the 25th April 2012, since I am working on ecosquared full time. I can see a third iteration which needs to generate moneyflow and palpable value during september. Whether this works or not, I do intend to write up ecological economics as a book. I had hoped to write up a descriptive account during August but an environment with children is not conducive to considered thinking and contemplative writing. I then wanted to embark upon a more narrative account, a partial fictionalisation of what has happened and projecting the ideas as they may manifest over the next few years.  I am setting myself a year to write this.

And a parting thought. I met Gerald from ball of dirt during the birthing period of ecosquared back in April, and he re-entered my mind recently. I had created a website in 2009 called takingthestand.org which was an attempt to seed the idea of going to eg Maldives and offering our futurist processes — if there is a need for solutions anywhere in the world, it is on islands which are threatened by flooding due to global glacial melt. It is the first time I have revisited the idea, and now equipped with financial protocols, I’d like to see if Gerald can see the potential for this. Anyone fancy a working holiday on the Maldives for a year…?

 

convergent aligned targeting

Think of the unemployed workers during depression who crowded against the gates to the docks and at factories, and being chosen for the day. It’s a bit like that, but more proactive. What if the hub was a space where clients came, engaged over a period of time, and left with the team assembled to achieve a specific objective, traditionally understood as a project? That is, the client leaves with the contract for a first iteration from people who assemble uniquely at that time. That is, there was no company to start with and participants self-organise to converge and align towards a specific target.

Which means we are breaking down the notion of a company. The way to enable this space is to have certain enabling “mechanics” or “articulations” which facilitate the quick alignment of individuals to put forward a proposal, or indeed create a prototype. An action cycle does this (action cycle transform), which is conducted at the boundary of a traditional company. A purely networked version of this is what we are talking about here, with only self-selecting diagonal players crystalising around a single player’s intention. What are the “ligaments”, or “weak attractive forces”, that enable this kind of social manifestation, specifically a client being happy with the team assembled to create the prototype?

  • high degree of opportunistic mindset of participants: open-mindedness
  • contracted to be “open” for 30% of their time, devoting 70% of their time to their own projects
  • open meetings where clients are invited, and they co-create with the available hub members to scope a gem


The objective of the hub is that it is primarily a social space where business is conducted at a deeper level than we are accustomed to in a market. Markets are loud as participants compete to attract attention to themselves, creating a pulling-apart or taking energy. The articulations provided by the members of the hub (financial protocols, social ligaments, physical mechanisms, mindful practices) enable a high-trust framework, where  people pull together, the energy being informed by generosity and giving, evolving a truly collaborative space.