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New tech needs new models to disrupt | Melissa Clark-Reynolds | Boma NZ | Grow 2019 Agri Summit

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Oh um, Kia ora mai tātou Mihi nui ki a koutou

Ke te Mana Whenua tenei ra um it's really lovely to be here and I think one of the most exciting things is that we don't often manage to get together as a sector and think about what's coming next We're often really deep in it trying to deal with what's around us today and a few years ago I think you heard in that kind of extended bio, I went to Stanford and there's a group of people I know there's a number of my old classmates in the room, where the To Hono program was designed to take New Zealanders up to Stanford and expose us to both the Business School iand the design school and it's entirely aimed at the primary sector and while I was there we did a half-day workshop we thought about the future and I got really excited about it and I'm gonna talk to the person who ran it and said well how do I get to join you and so literally two weeks later I was back on a plane up to Palo Alto and I trained with the Institute for the Future as a foresight practitioner and what's great about that is I'm part now of this international community of people through the Institute for the Future and it's the oldest futurist Institute in the US and I love this quote about the future being already here it's just not evenly distributed If we think about this there will have been a number of things you've heard in the last day and a half will you go cool I wonder if that's going to turn out the way things are and so often what happens as we'll see something we'll see a glimmer of something we won't know if that's the future or if it's going to turn out to be a dead end and of course there are no future facts so when we start to think about the future what we're really doing is we're using our imagination We're thinking about how it might play out and so what I want to get you to think a bit about today is that all of these technologies that turn up, until they've got a commercial model that makes them workable they're just kind of interesting tech and so part of that idea of whether the future is all around us is that we see interesting tech every day and I was talking to some of the guys at the morning tea break I've been playing a blockchain project, an international project between Copenhagen and New Zealand and what we found was that we realized that what we were trying to solve could be done with much simpler technology and so the blockchain thing was kind of interesting because it gave us a way of thinking about it but it didn't necessarily actually solve the job to be done the problem the commercial problem that we actually had and we found a simpler way to do it and so some of you may have seen this photo before

This is a photo, 1913 in New York City What's interesting about it is that 13 years earlier there's a photo that's taken at the same time that I'm going to use in my next session if you come to it, that shows the exact same street on the same day of the year 13 years earlier and the first car was being driven down Fifth Avenue Now I want you to imagine what it was like to be the person who owned the first car in New York okay, can you imagine this? So I recently read a report that was written by the Manhattan planning team and they said that Manhattan would never be built out and the main reason that Manhattan could never be fully built on was that they were not enough horses to move the building materials and we can kind of look back at that and go that's kind of crazy but what happens is that we plan from the sort of place we are today and so when that first guy and it was a guy bought that car and drove it down the street in Manhattan, what's really interesting to me was that he had a stables in his house in Manhattan and he had to send a horse and cart down to the docks to pick up the petrol to put into his car and you could imagine the neighbors just completely mocking him like why waste a really good horse to go down and get gas basically you got to feed the horse to go get it you were gonna feed the horse anyway it could have just taken you where you wanted to go and you could see that, this new technology, the car, it didn't have any infrastructure around itThere were no petrol stations, there were no drivers

There was a massive outcry when the car started to become standardized that horse people, so the stable hands, the people who you know were the horse drivers, that they were all going to lose their jobs and there is a, you know, going back, reading through the newspapers at the time there was a lot of upset around the disruption that the car was going to cause and particularly the social discomfort that the car was going to cause in New York and so I want you to think about that because we think we're in this time of great change and we are but there have also been other times of great change that have happen in the past and often when we look at those times of great change they help us to understand and it's there's, a there's a Maori whakatauki that means "to look back to look forward" and, and if we look back to look forward we can think about what's happened in other times of disruption and the thing that made the car work wasn't the car it was the petrol station And I want you to have a think about that because we think about some of these technologies that we're talking about in this last day and a half, what they need is an infrastructure that they fit around that means that they can become commercialized and so I want you to start thinking about what is the commercial model that will make this work I don't know if you know this but the virtual reality headset was patented before I was born and I'm in my mid-50s and every decade it's been the next big thing and does anyone want to have a guess what beat the virtual reality headset for most of that period? There's a small orange plastic item that I desperately want it for my ninth birthday and it was called the Viewmaster Right? and some of you who are my age or older will know what it was, for the rest of you, it's a small piece of plastic you put these circular things and you could see 3D pictures of Mickey Mouse or you know the Eiffel Tower or whatever it was It was incredibly exciting

It cost them about two bucks to make and the virtual reality headset on the other hand is heavy The early ones had to be suspended from the ceiling because they were so heavy to put on people's heads and people would go virtual reality is coming, it's coming, it's coming and I'm not saying it's not coming but what happened as it got beaten by a two-dollar bit of plastic that retailed for forty bucks and it got beaten by there for 30 years and so when we start to see interesting business models those are the things I want you to kind of pick up on and go that's kind of fascinating So one of the interesting business models I want to talk about here for a second does Beyonce and you probably don't think you're gonna get Beyonce in my talk but if you're in the food sector and you want to reach people even five years ago nobody would have told you that it was worth spending seven hundred thousand to have Beyonce take a photo of your food and put it on the internet and yet she's only the fourth most expensive Instagrammer in the world and so when we think about business models I remeber when I first looked at Instagram and I thought well how are you gonna make money at Instagram? How's it gonna work and what we probably didn't realize and it's taken some time to become apparent is that the people who are really making money out of Instagram are the people like a Beyonce and others who are making money as influencers and so now I can see that there are models that might work for those of us in the agri-food industry and food is the most beautiful thing so it's easily photographable and yet a number of New Zealand food companies that are on Instagram is really small and so for me I'm interested in how do I use Instagram to change the business model for my business Some of you will have heard about vertical farms what I'm finding really interesting about this is that where vertical farms are making money, and 80% of them are not ok, but 20% of the vertical farm industry is making money in the US and the ones that are have a couple of things in common so one of them is that they've found incredibly cheap real estate and that cheap real estate is downtown, cheap real estate and number two what has happened is that the price of solar power is almost at zero and so as the price of solar power plummets you combine very cheap rent in crappy old office buildings with solar power on the roof and your inputs into your business model are almost zero and then you have aquaponics with very cheap water and the ability for, and this is what really made it work is restaurants who own their own vertical farms are the ones who are making money and so what they can do is they can say there's some empty office space 200 meters down the road from my restaurant next week I'd like baby radicchio, can I grow it to order? of course! and I grow that baby radicchio and some basil garnish and some fennel leaves and whatever it is I need, it's cut, it's put in a wheelbarrow it's walked around the corner and that is a completely different business model than the current model of growing lettuces and garnishes here in New Zealand and exporting it to California and so it's not the vertical farm that should be frightening us it's the fact that they've found a business model combination of cheap power, cheap office space, free water, combined with local production to order and so what they can do is bring mass customization along with some very cheap and puts in the infrastructure enables a different business model and we're seeing more and more delivery options and what we're starting to see happen now is all-you-can-eat delivery options so pay ten dollars a month, not Uber Eats , per delivery but ten dollars a month and you can have food delivered as many times as you like and so the other big idea that I want you to think about is three things before I finish up so one is disintermediation which is the number of steps between the producer and the consumer is plummeting right now and the internet enables that and so the more steps you have in the supply chain the more trouble you're in

The next one I want you to think about is that everything is becoming a subscription business model whether it's deliveries, whether it's avocados, whether it's tractors, whether it's your fridge these things are all becoming just subscription models and the final thing that I want you to have a think about is what's called commodification and that is that over time the price of everything drops whether it's power, whether it's food, whatever it is so what are we going to do in New Zealand if the price of food drops to zero? Thanks

Source: Youtube

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