 Live from San Juan, Puerto Rico. It's theCUBE, covering Blockchain Unbound. Brought to you by Blockchain Industries. Welcome back everyone, this is theCUBE's exclusive coverage in Puerto Rico. I'm John Furrier, the co-host of theCUBE, co-founder of SiliconANGLE Media. In Puerto Rico for Blockchain Unbound, this is a global conference going to the next level in industry migration up and growth in blockchain, decentralized internet, and obviously cryptocurrency changing the world up and down the stack. I have an industry veteran here. My next gasoline is my al-founding CEO of Singularity University and author of the best-selling book, Exponential Organizations. He's seen many waves, friend, known him for years. Haven't seen him in a while, but you look great. You've been changed. The hair hasn't changed a lot. It's still got mine. Hey, great to see you. And bumping into you in Puerto Rico is really compelling because you have a nose for the future. And I've always respected that about you. You have the ability to understand at the root level what's going on, but also pull back and see the big picture. Puerto Rico is the center of the action because the killer app in this is money, right? So money is driving a lot of change, but there's some fundamental infrastructure stack upgrades going on. Blockchain has been highly discussed. Crypto is highly hyped. ICO is scammers out there, but now it's some legit. What's your take? What's your view right now of the current situation? Well, I think what's happening with a place like Puerto Rico is when you get kind of wiped out of the old, you have the chance to leapfrog, right? And when you think about any of our traditional environments laying down blockchain technologies, et cetera, it's really, really hard because you have to get the Supreme Court, the Constitution to approve blockchain-based land titles, and then you build a stack from there from a legal perspective. Here they can basically start from scratch and do it completely from the ground up, which is what's exciting, I think, for everybody here. Yeah, the topster that we've been reporting here is the Puerto Rico rebound. It's rebooting. The hurricane, obviously, I won't say a forcing function, but in general, when you get wiped out, that is certainly an opportunity to rebuild if there's any kind of silver lining in that. And there's a long history of this. Japan got wiped out during the World War II sort of Germany and they rebounded incredibly. We've seen now recently Rwanda. We do a lot of work in Medellin and Columbia, and that's just been one of the worst cities in the world. It's not the most innovative city in the world. And so this is the transition that we're seeing a pattern for. One of the things that I'm really excited about decentralization and blockchain is all the conversations have the same pattern. Efficiency is getting wired into things. So if you see Slack in the system or some inefficiencies, entrepreneurs are filling the void. So the entrepreneurial eye of the tiger goes right to that opportunity to reset, reduce steps, save time and make things easier. Classic value proposition in these new markets. You run a great university, but also author of exponential organizations. So a lot of people are scared. They're like, whoa, hold on, slow down. This is bullshit. We're not going to prove it. And then they have saying, no, this is the future. So you have two competing forces colliding. You have the new guard saying, we got to do this. This is the future. Old guard saying, blocks, roadblocks, blockers. You cover this in your book in a way. So how do you, how do you win? Who wins? How do you create a win-win? Well, you can't create a win-win. What you have to do is leapfrog to the new as fast as possible. The only question is, how quickly can you get to the new? And the problem that you have, as you rightly point out, is when you try disruptive innovation in any large organization or institution, the immune system attacks you. And I saw this in Yahoo! Running Brickhouse. Yahoo! is supposedly a super advanced organization. And yet the minute you try and do something really radical, you spend all your time fighting the mothership. And so I've been focusing a lot of time last few years focused on that particular problem. And we're pretty excited. We believe we've cracked it. How does someone crack that code? If I'm Puerto Rico, obviously the government officials are here at Blockchain Unbound. This is not just a tech conference. It's like a tech conference, investor conference, kind of World Economic Forum rolled into one. Sure. There's some serious players here. What's your advice to them? So what we do, and let me describe what we do in the private sector and what we do in the public sector. Well, a couple of years ago, the global CIO of Procter & Gamble came to me and said, hey, we'd like to work with you, et cetera. And what we typically see is some executive from a big company will come to Singularity. They'll go back to headquarters with their hair on fire, going, oh my God, you know, if they're from BMW, for example, they go back going drones, autonomous cars, Hyperloop, VR, you know, back in Munich, they'll be given a white coat and some medicine and be put in the corner, right? You're too crazy to stand over there. And that's the tension that you're talking about. And then somebody else will come six months later, then they'll do the Silicon Valley tour, then they'll have one of our people go over there. And it takes about three years for the big company to get up to speed, just the C-suite, to get up to speed, forget transmitting that down. So I was talking to this, Linda Clement-Holm, her name is, and she, I said, look, we're about to start this three-year dance. I've been thinking about this, let's shrink it to 10 weeks. So we've designed what we now call an EXO sprint, which is how do you get a leadership culture management thinking of a legacy organization three years ahead in a 10-week process. And the way we do it is we're in an opening workshop that's really shocking off, freaks out all the incumbent management, and then young leaders and future lieutenants of the business do the thinking of what should come next, and they report back. And something about that opening workshop suppresses the immune system, and when the new ideas arrive, they don't attack them in the same way. So we've run that like- It's like a transplant, if you will, the young guns. It's like when you do a kidney transplant, you suppress the immune system, right? It's that same idea. So we've run that like a dozen times. We just finished TD Ameritrade, HP Visa, Black and Decker, et cetera. We're open sourcing it. We're writing a manual on how to do it so that anybody can self-provision that process and run it because every one of the global 5,000 has to go through that process without us. So then we said, okay, could we apply it to the public sector? Where the existing policy is the immune system, right? You try and update transportation and you're fighting the taxis or education, you're fighting the teachers' unions. And we have a 16-week process that we run in cities. We do through a nonprofit called the Fastrack Institute based out of Miami. And we've run it four times in Medellin in Columbia, and we just finished four months with the mayor of Miami on the future of transportation. And we're talking to the officials here about running a similar process here in Puerto Rico. I know they're serious about that because one of the things that they throw money at projects kind of sits on the vine, dies on the vine because there's an accelerated movement right now. I mean, exponential change is here. So I'll give you an example. We're seeing and reporting that this digital nation trend is on fire. Certainly everyone wants digital cities, IOT is out there, but now with the cryptocurrency, the money being the killer app is flowing everywhere, out of Columbia, out of everywhere. Every country is moving money around with crypto. It's easier, faster. So everyone's trying to be the crypto ICO city. Yes. So on Telegram today, France wants to be, Paris wants to be the ICO city. Puerto Rico wants to be, Bahrain, Armenia, Estonia, UK, just trying to deal with Coinbase. What the hell's going on? Well, I mean, how do you rationalize this and what do you see is in a future state here? Well, I think, okay, a couple of thoughts and you're hitting into kind of some of the things I've been thinking about a lot recently. Number one is that when you have a regulatory blockage, it's a huge economic development opportunity for anybody can then leapfrog it, right? Nevada authorized autonomous cars early and now a lot of testing is done there. And so the cities that appreciate it. So you're saying regulatory is an opportunity to have a competitive advantage. Huge. Because look at Zoog in Switzerland. Nobody ever heard of the place. You pass through there on the way to Zermatt, but now it's like a destination that everybody needs to get to because they were earlier, right? And this is the traditional advantage of places like Hong Kong or Dubai or whatever. They're open and they're hungry. And so we're gonna see a lot of that going on. I think there's a bigger trend though, which is that we're seeing more and more action happen at the city level and very, very little happen at the national and global level. The world is moving too fast today for a big country to keep up. It's all gonna happen now in this next century at the city level. And so we work a lot with cities to do this. Or smaller countries. Or small countries. Okay, so what's going on here at Blockchain Unbound for you? Why are you here? What are you doing? What's your story? So I have this kind of sprint that we run in the private sector and public sector and then a community of about 200 consultants. And I have to pay 200 people in 40 countries and it's an unholy mess with holding taxes and concerns around money transfer costs. It's a hassle. It's a nightmare. And so I've been thinking about an internal cryptocurrency just to pay our network. And all of a sudden like three or four public companies have said, hey, we want to buy that thing to have access to your network. And so I've got like all this demand over here. I need to figure out how to design this thing properly. So I've been working some of the folks like Brock and DNA and others to help think through it. But what I'm really excited about here is that there's a, you know, what I love is the spectrum of dress, right? You get the radical Burning Man hippie guy all the way to a three-piece suit. And that diversity is very, very rich and really real creativity comes with it. This feels like the web in 96, 95, right? It's just starting. People know there's something really magical. They don't quite know what to do. Well, what I'm impressed about is there's no real bad vibe from either groups, sets of groups. There's definitely some posturing. I've noticed some things. You know, I'm obviously wearing a jacket so those guys aren't giving me hugs. Like, you know, getting there, giving a Brock a hug. But, you know, I get that. But the thing is, the coexistence is impressive. I'm not seeing any real mudslinging. Again, I didn't like how Brock got handled with John Oliver. I thought that was unacceptable because he's done a lot of good work. I don't know, personally, I've never met him, but I like what he's doing. Yeah, I like his message. Yeah. His keynote here at D10E was awesome. Yeah. Really the right messaging. I thought that's something that I want to get behind and I think everyone should, but he just got trashed. Yeah. But outside of that, it's a welcoming culture. Yeah. If you don't like it, just go somewhere else. They're not going to, they're not giving a lot of people shit for what they do. And it's really accepting on the all sides. Right. Well, here's my take on the whole decentralization thing. We run the world today on a series of very top-down hierarchical structures, the corporation, the military industrial complex, Judeo-Christian religions, et cetera, that are very hierarchical. Designed for managing scarcity. We're moving the world very, very quickly to abundance. We now have an abundance of information. We'll soon have an abundance of energy. We'll soon have an abundance of money, et cetera. And when you do these new structures, you need very decentralized structures. Burning Man, the maker movement, the open source movement, et cetera. And it's a very nurturing, participatory, female type of archetype and we're moving very quickly to that. And what we're seeing in the world today is the tension going from A to B. Yeah. And also when you have that next level, you usually have entrepreneurs and sponsorships, people who sponsor entrepreneurs, the promotion side of it, PR, that starts the industry. Right. And then when it hits that level, it's like, wow, it's going to the next level. Then it gets capital markets come in. When you have new stakeholders coming in now with government officials, this thing is just rocket shipping big time. Yes. And so that's going to change the dynamics, your thoughts and reaction to that dynamic. Completely. For example, when we do these public sprints, we end up with a, usually a decentralized architecture that needs to be built. For example, we're working with the justice system in Columbia and the Supreme Court has asked us to come in and redo the entire justice system, right? Now you think about all the court filings and court dates and briefs and papers, all should be digitized and put on a blockchain type structure because it's all public filing. We have an opportunity either to completely redo that stack and then make that available to the rest of the world. And I think that trend is irreversible for anything that previously had center. I mean, most government services are yes, we're ratifying this and ratifying that and they all disappear. Well, Selim, I want to tap your brain for a second since you're here. Yeah, get it out there because I want to throw a problem at you and a quick real time riff with you. So one of the things I've been thinking about is, obviously look at what cloud computing did. No one saw Amazon web services early except from the insiders like us who saw, okay, it's easy to host them, build a data center, I have no money to start up or whatever. You use AWS EC2 and S3. They were misunderstood. Now it's clear what they're doing, right? But that generated the DevOps movement. So the question for you is, I want to riff with you on is, okay, that created programmable infrastructure. The notion of serverless now is going mainstream, meaning I don't have to talk about the server, I need resource and I just make software, make it happen. That's flipped around the old model where it used to be the network would dictate to the application what they could do. How is that DevOps ethos? Certainly it's driven by open source. Get applied to this cryptocurrency because now you have blockchain cryptocurrency, ICO is kind of an application if you will, capital market. How does that model get flipped? Is there a DevOps model, a blockchain ops model where the decentralized apps are programming the blockchain? Because the plumbing's the moving train right now. You got, you know, hash graphs got traction, you got Ethereum, lightning's just got $2.5 million. I mean, anyone who's technical knows it's a moving train in the plumbing. But the business logic is pretty well defined. I'm like, I want to innovate this process. I'm going to eliminate the efficiency. So this dynamics, does the business model drive the infrastructure? Does the plumbing drive the business model? Your thoughts on this new dynamic and how that plays out? I suspect you and I are in violent agreement here. It's always going to be led by the business model because you need something to drive, to act as the power of pull, to pull the thing along, right? I mean, the real reason for the success of Ethereum right now is all the ICOs and it was a money-driven thing. Today we're going to see these new stacks. Now we're on like level version three of these new types of stacks coming along. And I think they're all looking for a business model. And once we find some new killer apps for this decentralized structure, then you'll really start to see things happen. But the business model is where it's at. So basically, I agree with you. So I think we're on the same page here, but then the advice would be to entrepreneurs, don't fret about the infrastructure. Just nail your business model. And because the switching cost might not be as high as you think. We're in the old days, when we grew up, you made a bad technology decision, you're out of business. So it's kind of flipped around. Yeah, I mean, just hearing about this term atomic swaps where you can just essentially, once you have a tokenized structure, you can just move it to something else pretty quickly. And therefore, all the efforts should be on that. And I think finding the really compelling use cases for this world is going to be fascinating to see. So software-defined money, software-defined business, software-defined society is coming. Yes. Okay, software-defined, that's the world. Celine, thanks for coming on, sharing your awesome expert opinion. Congratulations on your awesome book. How many countries is your book? It's an exponential organization. It's now about a quarter million copies in 15 languages. Required reading in all MBA programs and the C-suite, congratulations. It's like the 10X engineer that Mark Andreessen put out. It's like a whole new paradigm of management. It's happening, digital transformation. I mean, we now have the ability to scale an organization structure as fast as we can scale technology. Blockchain, you know, the nature of the firm was all about having people in one spot so centralized we can manage stuff. Now with Blockchain, you have a decentralized organization. That's your new book. That's right. The decentralized organization. Although, I'm not sure I have another book in me. There's a book out there for somebody. Decentralized organizations leave. Thank you for joining us. I'm theCUBE here. I'm John Furrier, the co-host. Date you coverage of Blockchain Unbound More. Coverage after this short break.