For a technology to be “exponential,” the power and/or speed doubles each year, and/or the cost drops by half.
As humans, we tend to overestimate what can be achieved in the short term but vastly underestimate what can be achieved in the long term. Humans are not equipped to process exponential growth. Our intuition is to use our assessment of how much change we’ve seen in the past to predict how much change we’ll see going forward. We tend to assume a constant rate of change (thinking linearly rather than exponentially). Thinking exponentially, though, is key to discovering potential new opportunities and building innovative solutions.
The Law of Accelerating Returns and Moore’s Law are both central concepts to understanding exponential growth.
We help entrepreneurs and startups that take moonshots. Here’s what we mean by that:
Some companies focus on improving existing solutions. Incremental changes can lead to a10% improvement, but in this case, no one is challenging commonly-held assumptions or applying new tools to create a totally new solution. Those that aim to make something10 timesbetter end up challenging the status quo, and typically end up taking a completely new path. This type of innovation requires bold, courageous thinking.