Dems and GOP are both rotten at the core

What this election has demonstrated to almost all of us is that the Republican party was rotten at the core.

I'm of the belief that the so-called "elites" of the GOP (some of whom I know) are generally rational, competent, open-minded people.  I know some will disagree with that, but that's my opinion.

So, what I've seen come about in this cycle is a Republican party that was like a piece of fruit that looked ok on the outside, but was full of maggots and rot on the inside.

It's got a nice chunk of anti-immigrant, racist, bigoted, closed-minded people.

That's definitely not something I want to consume and it's why I think Hillary will win.

However, here's my other concern.

The same rot has infected the Democratic party.

It may be one election cycle behind, but it's there, albeit in a different form.

The heavily Socialist economic policy and the BDS/anti-Israel philosophies are expanding at a rapid pace.  It defies my understanding why Israeli flags are burned at the DNC or why Black Lives Matter needs to state its alignment with BDS.

I have the same view of the so-called "elites" of the party (again, some of whom I know) as the GOP, but I fear that we are seeing a growing hatred and intolerance of another kind that the party leadership, like the Republicans, will not be able to control.

Saunas and Travel Experiences

I am a big fan of saunas. I like the intensity of the heat (I prefer dry).

I also like how, by virtue of the fact that you are naked and you’re sweating like crazy, that people are able to talk more freely.

I’ve found that some countries do saunas really well. Some don’t. Finland, Russia, Germany, and Estonia are great at it.

The Finns, by many accounts, are jedi masters of the sauna and, for many years, it was in saunas (co-ed, btw) that many business deals were transacted.

As my friend, Heikki said, “in the sauna, you can’t hide…that’s how you build trust.”

My hotel in Tallinn had a great one and over the course of 3 nights, I was able to meet some Finns, a Latvian, and a Lithuanian.

While their English wasn’t always great (better than my Finnish, Latvian, and Lithuanian though), I asked a few questions and then just listened. 

It is through the people that I most enjoy traveling.  Seeing the sights is nice, but you can do that with Virtual Reality glasses.

Listening to people and ENJOYING listening to people who are outside of your normal course of action.  That’s what makes travel special.

In close spaces at 205 degrees Fahrenheit, you really can concentrate on the words and emotions of the other person.

And a bonus…those who come from strong sauna cultures know sauna etiquette…the primary of which is…when you come into the sauna, you immediately close the door! Don’t stand there like an idiot with the door open. It’s chemistry, the heat goes right out.

The Estonian E-Miracle, Day 2

We headed into Day 2 of the journey through e-Estonia with our heads still reeling at the extent of the innovation and the possibilities.

Selling the Estonian E-Miracle

So, it was perfect that we had a chance to sit down with Indrek Pällo, the Director of Estonian Investment Agency at Enterprise Estonia, and the guy charged with actually taking this “product” and selling all of this globally.

He’s tasked with attracting jobs, direct investment, helping to create export markets, and increasing e-residency.  Like almost any marketer, he faces the challenges of Awareness and Perception.

On the pro side, what Indrek has going for him is a country where doing business is easy, the IT education and training is very strong, English is essentially a 2^nd language, taxes are low, and work ethic is high.

Estonia ranks 13^th among economic freedom, has top credit ratings from the various agencies (we’ll leave out “The Big Short” wisecracks here), 80% internet usage and a per capita GDP of 13, 210 Euros.

They have more startups per capita than any country in Europe and are #2 in the world behind Israel, so innovation is deep in the DNA.

On the con side, what Indrek has going against him is a location challenge (not super central) that is exacerbated by its neighborhood (read: Russia) and a small market/employee base.

And bigger than all that, is an awareness problem globally that Estonia is truly the “real deal” or perhaps, better said, that Estonia is even out there as an option.

Still, all that notwithstanding, Estonia has managed to become a regional center of excellence for offshore work for Swedish, Finnish, and Danish companies. They have no desire to become a low-cost center like India, for example. Not only because of the economics, but because of the scale. 

For example, if a huge company shows up in Estonia and says, “ok, we need to hire 2,000 people,” that’s not necessarily a good thing…initially.  They just don’t have the (talented) bodies. So they either need to attract them (see www.workinestonia.com) or grow them…which takes time, the technical universities of Tallinn and Tartu are leaders in that respect.

Indrek’s team is more likely to say, “let’s start with 40 or so and see if it makes sense.” They are looking for highly-skilled jobs in InfoTech and mechanical engineering, not vast numbers.

 It’s a different mindset.  Think Navy Seals versus a battalion.

When companies think “regional hubs” or “easy to do business,” they might think Singapore, London, Berlin, Dubai. 

With 15 salespeople (essentially) worldwide, Indrek’s job is to change that and he and the team are on their way.

They were responsible for generating over 20% of the total foreign investment in Estonia in 2015.

Still his job won’t be done until Estonia is listed as #1 in “Top Global Places to Do High Value Knowledge Work” (not sure that’s a real index, but you get the gist).

The “Estonian E-Miracle” story needs to be known by far more business leaders than it is right now.

X-Road at the X-Road of the Estonian E-Miracle

We then had a chance to go deep into the heart of what makes the Estonian E-Miracle work. That would be the X-Road system.  Developed at a cost of 50 million euros (compared to the 2 billion that Finland has spent and the 20 billion that the UK has spent—and which aren’t done), it is the core plumbing, if you will, that connects all of the government services with each other in a secure way.

Built by a company called Cybernetica, and led by CEO Oliver Väärtnõu, it “create[s] a secure and standardized environment for interconnection or enabling data exchange between a multitude of different information systems.”

Simply put…it makes Estonia work as smoothly as Estonia works.

The technology is peer-to-peer, which means that there is no central server or data center that is vulnerable to attack.  It works over the public internet, so there’s no private network that needs to be maintained. It is decentralized. 

As Oliver says, “X-road was build to support the democratic process.”

With X-road (or as Cybernetica now sells it to other countries the Unified eXchange Platform), countries (or cities/municipalities) have the ability, as Oliver says, to “create government e-services…or just leave it in the corner or use it as a hammer. Whatever they want.”  But they have the technology to make government really work well and serve as an enabler.

That’s a ridiculously powerful concept and so foreign to most of the world…but it’s the essence of modern Estonia.

And now, Cybernetica is bringing it to the rest of the world, along with their other cutting-edge solutions in border surveillance (they help protect Estonia’s eastern front), maritime radio communications, and visual aids to navigation.

These guys are HARD CORE.  Of their nearly 120 employees, over 80 are involved in R&D and Oliver says that “this is the lifeblood” of the company.

In fact, 20% of the employee base is in a separate business unit that is a non-profit R&D function. That’s how committed they are.

It has been since Soviet times, actually. The institute was founded in the 1960s to do basic research and was actually responsible for many contributions to Soviet technological development.

Through a unique partnerhip with the government after independence in 1991, they were able to continue and then, in 2000, management bought the company from the government.

As we spoke w/Oliver, I felt like we were at the absolute epi-center/ground zero, if you will, of the e-revolution that should impact government entities around the world. (Bonus points if you can zoom in on this picture and figure out what is printed on their walls).

Exploring FinTech

We also dove deeper into the Estonian start-up entrepreneurial scene, having two meetings with FinTechs startups Funderbeam and Fundwise. [FinTech is shorthand for Finance Technology]. These are companies that are either seeking to seriously disrupt the way that banks and financial institutions do their business or significantly improve it.

Mads, the CMO of Funderbeam, is a man possessed by a passionate vision…namely, start-up investing shouldn’t be limited to the rich and connected. It should be democratized and available to anyone who wants to put in a few hundred or thousand dollars. Joined at the end of our meeting by Bjorn, a native Minnesotan, successful Jobbatical placement, and Sprinklr fan who saw my Swarm check-in, I couldn’t help but think that we were getting a sneak peek into the future of a part of finance.

Instead of a few, well-placed and well-connected investors putting tens or hundreds of thousands of dollars using a heavily paper-based process, Funderbeam sees a world of Kickstarter-like projects, but instead of an item or experience, you get shares (sort of) in the company. 

Led by syndicates, you can find a company that looks promising, put your money in (I’m leaving out some details), but you get a “token” that is cryptographically secure and backed on the blockchain, representing your interest.  And the best part?  These tokens can be traded freely. So, unlike most early-stage investments, you don’t have to wait for an exit or spend a lot of time looking for a buyer of your portion of the company.  You float the “tokens” and sell them on an exchange.

Think Nasdaq for any private company.  Not so surprising since their CEO, Kaidi Ruusalep, is a former Nasdaq Tallinn official.

My only issue with Funderbeam? As an US citizen, I can’t participate in it…yet. SEC/IRS laws make it really difficult. Aaargh!

Attacking the challenge, albeit from a slightly different angle is Fundwise. The CEO, Henri is working with the Estonian business registry to simplify the process of crowdfunding private companies. There’s a pretty nice video on their website.

These two teams were a microcosm of the entrepreneurial energy that is sweeping the country.

Is everything perfect?

Of course not.

I failed miserably in my effort to set up a bank account. My mistake was in not registering a business first. Fortunately, the law has changed that in-person visits to the bank will no longer be mandatory and later this year, I should be able to fix that via Skype.

Still…what you have here is a country that is “digital by default,” is committed to innovation, has a need for innovation for both economic and security reasons, and has created, and this is perhaps the most important thing…a culture of innovation.

Overall, we had 9 meetings in the course of two days. It was pretty action packed, but as my friend Jacob said before I left, “there’s value in immersion.” 

And indeed there is.

If you are fascinated by innovation, technology, geo-politics, or having it stay light until 10pm in the summertime….Visit Estonia.

Notes: Click here to see the entire e-Estonia itinerary.

Estonia:You barely spend time being a citizen

I’d been evangelizing Estonia for so long, I almost forgot how impressive the story was for me when I heard it the first few times.

I was reminded, however, when I saw the beauty of the story through the eyes of my parents, my sister, and her boyfriend.  They were en route to St. Petersburg and Lithuania (from whence my paternal grandfather emigrated), but had heard me badger them about Estonia so much that they decided to make a stop and visit the E-Estonia showroom in Tallinn.

Simply put, They. Were. In. Awe.

Our presenter, Indrek Onnik (shout out to the Managing Director, Anna Pipperal and the coordinator Teele Jarvelill) blew us away with a ton of amazing facts, including:

•  Average time to pay taxes....4 minutes. That’s right. 4 minutes
• Gov't expenditures reduced by equivalent of 2% of GDP thanks to all digital signatures
• ·Average time to set up a new business in Estonia: 18 minutes
• ·When it’s time for your license to get renewed, you get an SMS with a  link. You go online…CAN CHANGE YOUR PICTURE IF YOU WANT…and then renew it, in seconds.
• If the police (or anyone) does a search of your personal information..you know about it and, if you are curious about why it happened, you can inquire.
• You can vote online.
• You can pay your taxes online and have your refund within the same week.

The only 3 things you can’t do online? Get married, get divorced, or sell your house. They need you show up in person so that they know you aren’t being coerced.

The land registry is online.

In fact, the country has something called “a Data Embassy,” which is a real-time back up of all the information about the entire country in a secure facility outside of Estonia?

Why?

In case the Russians invade again. Essentially, the whole country is backed up to the cloud. Seriously.

By their estimates, the citizens of Estonia have gotten back 2 whole weeks of time from bureaucratic nonsense that they can devote to more productive things.

As the CEO of Jobbatical, Karoli Hindricks, said: “You barely spend time in being a citizen.”

The Estonian tax authority is the most efficient and effective tax collection service in the entire world.

I could go on and on, but suffice it to say, it’s light years ahead of what the US or, heck any country can actually provide.

Oh…and it’s all mobile-friendly/mobile-enabled.

They have some guiding principles that will run near and dear to the heart of any technologist:

• No legacy systems…technology is refreshed every 13 years, at a maximum
• The country is “digital by default”
• User-friendliness
• Omni-channel
• 24/7
• open standards
• single point of entry
•  “once only”…you don’t give your information to more than one place.

It’s hard to explain to the average American what’s going on here because the paradigm is so radically different to what you are used to.

Just take a look at this page and get a feel for some of the services that Estonia provides digitally in a secure way (you’ll have to take my word for it, but NATO’s cyber defense command is here for a reason).

In some respects, this is the essence of Estonia’s challenge. It’s not a technology challenge. As Andres Kutt, the lead architect for the Information Systems Authority said (video), "we've solved the issues of breaking down silos.” 

Estonia has a marketing challenge.

It’s the single most advanced digital country in the world and not enough people know about it or appreciate the epic achievement that it represents.

Taking e-Estonia to the world

To its credit, the country isn’t resting on its laurels. The e-residency programme which has 12,000 members (of which I am) represents an effort to do a few things.

·       Create a trusted digital identity that can be accepted worldwide. After all, when you become an e-resident, Estonia has certified that you are who you say you are.

·       Make Estonia the preferred based for anyone wishing to do business with low hassle in the EU

·       Generate tax revenue and jobs in Estonia

·       Create a community of pro-Estonia ambassadors with a vested interest in the country’s success…which could be critical in the event of a national defense scenario

So, they are leveraging (or attempting to) all of this infrastructure for economic growth, increased social trust, and national defense.  How’s that for a trifecta?

I was joined on this trip by a friend of mine, Heikki Nakkari, a Finnish national with whom I attended the International University of Japan and hadn’t seen in 20 years. His perspective was invaluable as much of the inspiration for the Estonian e-miracle (as I have just coined it!) came from Finland.

The only thing is…Estonia did it better than the Finns did!

Our next two stops were Jobbatical and Teleport, both companies that represent Estonia’s new view of the world.

You see, Estonia has about 1.3 million people, so when the wall fell and the Soviet Union fell apart, they quickly realized that there was NO way they would be able to prosper as a country without looking outwards. 

So, a borderless world with open trade was the way to go.

Jobbatical and Teleport (founded by Sten Tamkivi, one of the early people at Skype) are both founded on the premise that talent is-and should be-mobile. 

Jobbatical seeks to connect talented people looking for international work experience with companies looking to bring in international talent.  Say, for example, you’re a developer or a marketer who wants to work in SE Asia…not for a few years, but for a year. They’ll connect you.

Meanwhile, Teleport approaches the same issue from a slightly different angle.

They are saying, “ok, you’re a talented developer or marketer or whatever, given the things you care about…other people like you, or parks, or cost of living, where in the world SHOULD you work?”

In a world of inter-connectivity, locations compete for talent and the very idea of a nation-state is up for challenge.

If you think about it, Estonia is preparing for this.

Essentially, they are saying: “how can we scale to have 10 million people invested in our economy without actually having 10 million people living here?” 

It’s genius, if you ask me.

There was a great slide in the e-Residency program presentation by Ott Vatter, the head of Product and Partnerships, showed Estonian e-Residency as an equal to Uber and AirBNB…a corporation that doesn’t have physical inventory but adds incredible value.   

To me, that is spot on.

It’s getting late and I’ve got a full day of more meetings in Estonia tomorrow and there’s SO much more to discuss and pontificate on including:

• ·       The 80-20 rule to software development. In short, they are agile developers who take a lot of “little bets.”
• ·       The tolerance for government-led innovation in Estonia based on a strong track record of performance and delivering
• ·       software as a liability
• ·       government info systems as innovation driver-an extension beyond the traditional two of only land and people
• ·       the potential pitfalls of e-Residency
• ·       Estonia as e-Narnia

Our last meeting was with Erik and Kaspar, the co-founders of the EResNetwork, the premier community for e-Residents worldwide.

These guys are very much the face of Estonian innovation, recognizing that the power of a diverse e-Residency network is going to be a good thing for their country and, possibly, the world.

That positive attitude and optimism was something we encountered time and time again.

You hear about what happens when government is truly an enabler of business and doesn’t get in the way of civil society.

In Estonia, you get to see it firsthand.  It’s pretty impressive.

More to come.