A decade's worth of learning in a year
It was a hot afternoon in January last year when I received a WhatsApp from Jack Zhang of Airwallex: "there's a virus emerging in Wuhan."
Jack told me it was highly likely that we were on the cusp of a global pandemic.
All of us would have similar stories about when we first heard about COVID-19. During those first few weeks, reactions ranged from panic to outright dismissal of the threat. But by late February, it was apparent that the equivalent of a freight train was bearing down on us, without a driver behind the controls.
It was difficult to imagine, but Jack's warning was all too prescient, and the last year has been dominated by the single biggest global event since World War Two.
The impact of COVID-19 has been awful. To date, over 3.3 million people have died and over 160 million people have had the virus. Millions of people have lost their jobs or their business or had their career derailed. It has taken a terrible toll that has frequently been arbitrary in its impact: not everyone has been impacted and some have seen their fortunes improve.
Over a year has passed since the onset of the pandemic and it felt like a good opportunity to reflect on what I have learnt over the past year.
We are innovative at our core
The past year has reinforced how creative and resilient individuals and societies can be. Crises are an enormous catalyst for innovation. We have seen our cities embrace outdoor living, retailers and restaurants move their businesses online, Governments adopt best practice in testing and tracing, and startups identify opportunities that have arisen because of COVID-19.
There are hundreds of millions of heroes in this story who have displayed extraordinary leadership and sacrifice in the service of others. None more so than the founders of BioNTech, Dr. Ugur Sahin and Dr. Ozlem Tureci. Doctors Sahin and Tureci are the Turkish-German couple who developed a COVID vaccine in partnership with Pfizer. In January last year, Dr Sahin read an article on COVID in The Lancet and immediately recognised the risk of a global pandemic. Overnight, BioNTech changed course from developing immunotherapies to treat cancer to developing a COVID vaccine. Decisiveness, clarity of thought, genius, hard work and vision were all required in equal measure to achieve this extraordinary outcome. The example of BioNTech is a high profile and incredibly impactful example of the remarkable ingenuity displayed by so many people around the world over the past year.
Of course, there are many contrary and more gloomy examples where people or companies were unable or unwilling to innovate. In times of rapid change, the bifurcation of outcomes is incredibly severe and not every development has been positive.
Technology, meet everything
An overriding theme of the past year has been the extraordinary acceleration of technology trends that started in the mid-1990s with the emergence of the internet and the digitisation of everything.
In the startup world, we see the emergence of a generation of new companies that are responding to the acceleration of technology adoption.
There are a range of areas where COVID has created a renewed impetus for innovation including ecommerce, remote learning, online healthcare delivery, cybersecurity and in the workplace.
Hopin is enabling companies to operate virtual events and conferences, Roam Research, Airtable and Notion are all enabling knowledge workers to increase productivity and collaboration. BetterUp provides a personalised coaching platform for employees and Mirror delivers a different type of coaching, positioning itself as a nearly invisible and personalised home gym solution.
In our own portfolio, companies such as Canva, Fiverr, Dr Anywhere, Neuron and HealthMatch have all seen a significant increase in demand for their products as they meet critical business and consumer needs that have become even more important in the context of COVID. These companies were all founded pre-COVID, but they have seen their growth accelerate dramatically.
We recently invested in Retrain.ai – a startup founded to help organisations develop and reskill their employees in an employment market that is undergoing dramatic change as a result of AI and automation. Retrain.ai was founded after the onset of the pandemic and is an excellent example of the type of post-COVID business that will emerge over the next few years.
The reimagining of everything
We believe that the next few years will usher in the highest calibre of startups globally since the Internet Era of 1994-1999.
- The catalysts for this innovation will be:
- the dramatic behaviour change that we have seen in the past year,
- the explosion of new opportunities and problems to be solved,
- an increase in the supply of talent available for startups,
- an increased acceptance of the need for change in society,
- the availability of capital to finance these opportunities
In essence, we are reimagining everything.
As an example, consider the University of Bologna, the world's oldest university, with a history dating back nearly 1000 years. In the second week of March last year, the University moved all of its classes online – arguably making a bigger shift in its teaching mode in one week than it had made in the preceding 900+ years.
While I don't believe that the future of education is a fully remote model, neither will it be doing the same thing that we have done for millennia.
In education, as in every other aspect of our society, there is an incredible opportunity to reimagine how things might work in a post-pandemic world.
In the March-May period when the level of uncertainty, and hence fear, was at its greatest, I was reminded how outstanding leadership changes outcomes.
This was a period of extremely difficult decision-making. Our portfolio founders and leadership teams needed to keep their company alive, their teams engaged and their families safe. So many of our portfolio company leaders, proved themselves to be exceptional; they were calm, empathetic, resilient and honest. They didn't pretend they knew all the answers, and they didn't shirk their responsibilities as leaders of their organisations.
Navigating rapidly changing and uncertain environments is a true test of leadership, and in this context, many people shone.
All leaders intuitively understood that their colleagues were highly stressed and genuinely scared; they were worried about their elderly parents, they were worried about their jobs and they were worried about their children's education. Empathy and constant communication were the hallmarks of great leaders during this period.
We all know how much leadership matters, but it is in a crisis where you really see which leaders stand out. I was inspired by the leadership I saw from so many people, and their leadership made a big difference to outcomes.
First principle thinking
Prior to COVID I had experienced three crises.
- I started my career as a lawyer during the recession of 1991/92
- I experienced the dot com crash of 2000 when SEEK was an emerging startup
- I worked through the GFC of 2007/8 when SEEK was a listed company operating in many parts of the world.
I had assumed that prior experience would be very useful in navigating the impact of COVID and understanding the potential consequences.
As it turns out, that prior experience was not particularly useful. In some ways, it may have even been harmful as it gave me false confidence in my ability to understand the likely implications of COVID. Every crisis is different, and a global pandemic that in turn creates an economic crisis is unique. As it turns out, a data set of three previous crises is a very small data set.
In a unique situation such as the past year, first principle thinking is a critical attribute. So many of the events of the past year have been obvious in hindsight, but they were anything but obvious in March 2020. The acceleration of technology trends that have been underway for 25 years, the avoidance of economic collapse resulting from stimulatory measures by Government's and central banks, and our communities' resilience during and after prolonged lockdowns all look unsurprising when looking through a rear-view mirror.
When we make decisions or assess situations, it is common to look at similar or analogous events in the past. This is generally a useful decision-making heuristic. However, when dealing with unique situations, you need the mental clarity and discipline to avoid exaggerating the resonance of these past experiences. In situations such as assessing the impact of COVID you need to break down the problem into its most basic elements and craft solutions through a process of intellectual curiosity and original thinking.
The power of rethinking
A related lesson for me is the importance of agility and being flexible in our thinking. I recently finished Adam Grant's wonderful book Think Again. Grant talks about the power of Rethinking and how it is such a critical attribute for so many successful people. That ability to challenge yourself and rethink your assumptions is incredibly powerful. For most of us, realising we are wrong about something can be quite challenging. Instead, we should welcome the opportunity to learn something new.
Over the past year, the need to think differently and be open to new ideas has been incredibly important. A great illustration of this openness and agility was displayed by Melbourne chef and restaurateur Shane Delia. Like so many other restaurants around the world, Shane's restaurants were all shut down in April. Shane responded to the situation differently to most and within six weeks he had built and launched Providoor, which is a platform for home delivery of restaurant meals that immediately attracted 50 of the best restaurants in Melbourne to his platform.
We weren't ready for a pandemic
It became apparent that very few countries in the world were well prepared for a pandemic. The best-prepared societies were those that had experienced recent epidemics such as SARS and Swine flu. The easiest lessons in the world are where you learn from the experiences of others - all countries in the world could have learned from previous epidemics, but most failed to do so.
The fact that we weren't ready for a pandemic raises the question of what other low probability, catastrophic impact events have we failed to prepare for? As we assess the core requirements of a modern functioning society, how well are we prepared for events that cause major disruption to those aspects of our society?
The question every Government should be asking is how much they have done to mitigate risks in food security, drinking water, electricity, the internet and fuel for transportation. The incentives for governments and our societies are weighted against making the necessary investments in these areas.
The lack of nuanced debate on topics such as food security, cybersecurity and risks to our electricity grid should alarm us. If we are not discussing these topics now, it is doubtful we will address them post-pandemic. Similarly, all companies should be asking themselves how well prepared they are for events that may be one in a century event, but which would threaten their existence if they were to occur.
The future of remote work
We learnt very quickly that knowledge workers could work very effectively remotely.
To some extent, the relatively seamless transition to remote work was as much a matter of the reality exceeding the low expectations of March 2020, as it was a reflection of the enormous progress over the past 20 years. New innovations in high-speed internet, the migration of applications to the cloud and a range of productivity tools enabled hundreds of millions of people to work effectively from home.
One of the great learnings is how much people value flexibility in their work lives. Employers are increasingly recognising that they can offer flexible arrangements to their team members without sacrificing outcomes.
There will be enormous complexity post-pandemic as companies grapple with the ideal mode long-term. There is no "right" answer to this question and every company will have to tread their own path. Every alternative, from high to low flexibility, involves some degree of trade-off. The key question for all companies is: what's the optimum solution that both maximises productivity and helps organisations attract and retain the most talented people?
Of all the unresolved questions, the future of the office and remote work is the one that has the highest level of uncertainty attached to it and we will continue to see thinking evolve on this topic for decades to come.
We are all in this together
At a time of increased division within and between societies, COVID was a powerful reminder of our common interests and shared humanity.
The pandemic may have started in Wuhan but in a globalised world, it spread rapidly and far too quickly for Governments to prevent its emergence in their countries. The pandemic is a reminder that most of the big problems in the world today are global, not local in their nature and require global solutions and multilateral cooperation.
The incredible speed of response to COVID and the amazing ingenuity of people in all parts of the world should inspire us to address the really big problems of society including climate change and rising inequality.
The past year has been the most intense period of learning that I can remember in my life, and no doubt it has been the same for most people. It has forced all of us to be creative and adaptable.
I hope we are all able to take those new attributes into the new normal that is emerging.
Stay safe everyone.
This article is part of our weekly content series All Signal. It's where my colleagues and I share our best mental models, resources and thoughts on technology. It's good reading and lands every Monday. You can sign up here.