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    Wednesday, September 2, 2020

    Out of the Crisis #21: Tomas Pueyo on the hammer and the dance, political polarization, and how the pandemic will affect the way we live and work

    In mid-March, as the coronavirus was sweeping through Asia and Europe, Tomas Pueyo published a piece on Medium titled One of a series he wrote after starting to analyze pandemic data in mid-February, the piece was shared by millions in multiple languages. It turned him instantly from an education technology expert--his day job is as VP of Growth at Course Hero--into a leading voice for how to move forward.

    For many people, "The Hammer and the Dance" was their first introduction to the epidemiology of how to defeat a pandemic. It lays out, in clear and concise terms, a two-part strategy: first the hammer to flatten the curve as fast as possible. And then, once that curve is low enough, governments can dance, testing and tracking cases until the virus is eradicated or we develop a working vaccine.

    Had we been able to apply this strategy simultaneously nationwide, the U.S. would be in a very different place than we are today. Instead, as Tomas told me, "every state was forced to behave like a country, but it was not equipped to behave like a country. Many had no idea how to deal with a pandemic. They didn't have experience buying bulk from the government things like masks or ventilators." The effects of that approach are ongoing and will be long-term. "If you can't even control the virus during the hammer period, it is unlikely that you can control it during the dance," he explained. "The benefit of the hammer and the dance is lower, and also the cost is higher."

    Now, six months in, the virus looks different in every part of the country and the world. But one thing holds true everywhere: "Normal will never come back. The world that existed is not coming back."

    Tomas and I talked about how political polarization has affected virus response, the best ways to approach the dance, strategies for countries that can't apply the hammer and the dance method, and why it's not possible to approach other catastrophes, like climate change, in the same way he's analyzed the coronavirus.

    You can listen to our discussion on
    Apple, Google, or wherever you like to get podcasts.


    A full transcript is beneath the show resources below.

    Highlights from the Show:

    • Tomas introduces himself and discusses his quarantine set up and experiences so far (2:22)
    • Readership for "The Hammer and the Dance" (5:10)
    • How Tomas came to write it, and his other writing (7:22)
    • How he decided which data to look at as the virus spread and what it told him (9:56)
    • What Tomas was doing at the time he began his coronavirus research and why he took it public (14:18)
    • His first Medium article, "Why You Must Act Now" (16:44)
    • The argument it made for the seriousness of what was coming (18:18)
    • Understanding which virus management strategy would work (20:00)
    • The early debates about how to handle the coming threat (21:32)
    • Tomas's call to action and how it felt to have it read and shared by millions (22:44)
    • "The Hammer and the Dance" (25:33)
    • How countries who applied the hammer brought the virus under control (29:18)
    • Moving forward into the dance (30:32)
    • The ways to unpack and read the data (32:21)
    • Herd immunity vs. hammer and dance (35:19)
    • Denying that the economy is made up of people (36:51)
    • The importance of incorporating new information with speed (38:20)
    • Avoiding mental pitfalls and confirmation bias (41:31)
    • Tomas talks about what he got wrong (45:29)
    • Key points in how the virus travels and how to say safe (48:43)
    • The politicization of the virus and the advice surrounding it (49:56)
    • Patterns in effective vs. ineffective government management of the virus (50:56)
    • On forcing states to behave like countries (52:40)
    • His assessment of the state of California (54:13)
    • On "Out of Many, One", Tomas's article on political polarization in the US (57:11)
    • What Tomas is working on as he looks at the next phase of the virus (1:03:02)
    • Strategies for countries that can't do the hammer and the dance effectively (1:05:10)
    • What Tomas wants to see both for the world and himself once this pandemic passes (1:09:17)
    • How he thinks the pandemic will affect urban living, education, and work (1:14:32)

    Show-related resources:

    Transcript for Out of the Crisis #21: Tomas Pueyo

    Eric Ries: This is Out of the Crisis. I'm Eric Ries. You remember The Hammer and the Dance? If you're one of 50 million people who read that article, you probably do, but who wrote it? For the past few years, there has been a trend of decreased trust in our public institutions. This shouldn't really come as a surprise. We have been busy chipping away at the foundations of our simple society.

    Getting clear, unbiased reports has been challenging, even for simple problems. So how are we supposed to get information out in the middle of a pandemic? How do we cut through the news in the disinformation campaign? Some of you may remember a series of articles that made the rounds in the early days. The most famous was titled The Hammer and the Dance, and for many people it was their first introduction to the epidemiology of how to defeat a pandemic.

    These articles laid out in clear and concise terms the available strategies that would allow governments to deal with the spread of coronavirus. The article advocated for a hammer at first to flatten the curve as fast as possible. And then, once that curve was low enough, governments could dance, testing and tracking cases until the virus was eradicated or we developed a working vaccine.

    These articles had an outsized impact on the public's understanding of what needed to be done and I think helped speed the adoption of shelter-in-place orders. And even though at least in the United States we never quite made it to the dance, tens of millions of people read them, and it shaped their understanding. It helped them to come to grips with what was happening and hold their leaders accountable for action and inaction.

    So when a fractured world where the media is as politicized as it has ever been, who managed to get this message out? His name is Tomas Pueyo. He was not a famous author. He wasn't a media star. He worked at an education startup here in Silicon Valley. So how did he do what so many others struggled to accomplish? Here's my conversation with Tomas Pueyo.

    Tomas Pueyo: Hi, I'm Tomas Pueyo. I wrote a few articles around the coronavirus that got viewed by over 60 million people, and that pushed me from really not a person very well known in the coronavirus world to appearing on the news and in different newspapers. Before that, my day job is VP of growth at an online education company called Course Hero.

    Eric Ries: Thank you for coming on. Thanks for making time.

    Tomas Pueyo: Thank you.

    Eric Ries: This has been a pretty stressful time for all of us. Let's start with how are you doing. How long have you been in quarantine? You saw this coming, so you must have a pretty extreme quarantine setup. Just tell us about how you're doing. How's your family? How are you hanging in there?

    Tomas Pueyo: Yeah, I started figuring out it was going to happen around the middle of February, and I was waiting for the cases to really start appearing in Silicon Valley. When the first case appeared in Santa Clara, I pushed really hard for my company, for myself to work remotely as much as we could. So even before the shelter-in-place was announced, my company announced remote work.

    And so, by now, we've been out, or we haven't been going out for more than two months. Both my wife and I work full-time. We haven't had the schools for the kids. We haven't had a nanny at home, and we have three kids below four years old, which has been quite trying for us and to juggle two jobs at the same time while also kids without help. And that's especially true since besides my day job, I had then to work on the coronavirus for a couple of months.

    That was around six, seven hours a day. As a result, I didn't sleep for a couple of months, and my wife had to work two times as hard helping at home, but thankfully even with all of that, I'm in a better position than many other people who have suffered during this crisis in terms of people who have lost their jobs, but I can't complain in spite everything.

    Eric Ries: I appreciate you saying that, and we should certainly reserve a moment to say thank you to all of the spouses and supportive partners that have made possible so much of this relief work that we have been talking about in this series of conversations. I'm in the same boat as you, not getting as much sleep as I would like, but cognizant of how much better we have it than so many who are struggling right now.

    Tomas Pueyo: Yeah, absolutely.

    Eric Ries: I had to do the math, and it's dangerous to do the math live, but I had to look up on Wikipedia the number of English-speaking internet users, which is about 1.1 billion.

    Tomas Pueyo: Yeah.

    Eric Ries: So if I'm getting it right, 60 million people is something like 5% of the possible audience of people who are on the internet and speak English.

    Tomas Pueyo: That's funny, so a couple of things. Actually, the article was translated. The articles were translated to over 40 languages each.

    Eric Ries: Oh my goodness.

    Tomas Pueyo: Yeah, I'm counting some of these other languages, and it's not always easy because I control, for example, the Spanish and French versions of the article. And each one of these was seen by more than a million people. Whereas, for example, I don't control the German one, which a newspaper published, but when I check in with them, more than two million people had read it. So really it is not just the English-speaking, but since you're talking about addressable market, I had a thought about it.

    And really the addressable market is not just the people, English-speaking, connected to internet, but rather I would say whoever is willing to spend half an hour reading an article about the coronavirus. I think that addressable market is probably, maybe, in the tens of millions, maybe hundreds but definitely not in the billions. So I think the most interesting aspect of this article is how just mind-blowing that distribution is.

    I was talking with a journalist that told me that, "When I read your very successful article, it gets seen by two million people at most," but having 20 times that is just ridiculous. It's crazy.

    Eric Ries: It's a remarkable thing, and I hope you have taken a few moments to appreciate the scope of it. We've had the chance to work together a little bit in crisis. And when I've been trying to recruit folks to help you with things, I don't have to say anything except for, "You remember that article, The Hammer and the Dance?", and everybody's heard of it. Everyone remembers reading it.

    It was a seminal moment for so many of us, and it's remarkable to me. I think you're right. Among the audience of people who are educated, who are interested in data, willing to read a lengthy and in-depth article about the coronavirus, it has unbelievable mind-share and it was such an important part for a lot of us of crystallizing our understanding of what was to come. Tell us, just walk us through the story of how you came to write that article and how you even had the imagination that you should be the kind of person who should become almost the spokesperson for the crisis response.

    Tomas Pueyo: Yeah, it's funny, because you mention The Hammer and the Dance. It actually was the second piece, but I think that is the testament of the craziness and the blurriness of all these events that have occurred over the last two or three months. So I think it's good to take stock of what has happened. Around the middle of February, I caught from Twitter from people like Paul Graham who had been tweeting about this coronavirus epidemic for some time, I identified the problem and I started looking at a little bit of data and posting it on Facebook.

    Eric Ries: To be clear, you were not a published author or a scientist. This is not your background to be writing these things.

    Tomas Pueyo: I am a public author but about a completely different topic. I have a book about storytelling structure, and I'm also not at all professional at storytelling. It's just one thing that I do that I take complex problems, and I go deep in understanding them and trying to solve them, and then trying to communicate about that problem. So the same thing really happened with the coronavirus.

    I had no idea about the coronavirus. I just started looking at the data and trying to understand, make sense, of what was happening based on the data. And initially that was just on Facebook for my friends, but very, very quickly because the world was not aware of what was going on and all of the data was public, you could make your own decisions, reach your own conclusions based on that data.

    And I think through February, one of the things that was obvious is that that had become a pandemic. By the end of February, the virus was in over 60 countries, and many of them had thousands of cases. And if you remember, Wuhan closed the entire region of actually Hubei when they only had less than 500 cases. So you knew by the end of February that this was a pandemic and that it was going to be catastrophic.

    Eric Ries: Well, you knew. You knew actually. Look, first of all, in these conversations, the number of times that the story begins on Twitter is remarkable. So first of all, what a testament to social media and its power to reach-

    Tomas Pueyo: Huge.

    Eric Ries: But a lot of us were on Twitter in February, and a lot of us were looking at headlines and follow Paul Graham. So you went deeper than the average person. First of all, what was the data you were looking at, and how did you even decide what data was good and what was bad, what was legitimate, what was worthy of analysis? How did you figure that out?

    Tomas Pueyo: Yeah, that's fascinating. One of my jobs in the past was consulting measures and acquisitions. And in that when you do that, within weeks you need to get very, very deep, become an expert in a new discipline without any previous background in it. And you need to look at the data very critically, because the other side of the merger or acquisition is actually trying to frame all the information in a way that is beneficial to that side and against your side.

    So you learn to really look at the data and also in tech, you also know this, it's very, very hard to figure out the truth from the information you get, the signal from the noise. And in fact, The Lean Startup is very much that. It's focused on how to learn as fast as possible with as little cost as possible. I think for me, the first course was Worldometers in that it was a day-to-day report on the cases.

    And one of the first things that you saw is that you had daily cases being exported from Italy, especially from Italy but also from Iran but especially from Italy, to all the corners of the Earth. So you're starting to see that, and you realize one healthcare system or two healthcare systems may be able to respond to a crisis successfully, meaning maybe South Korea and China, but once you have 60 countries that have cases, the odds that at least one of them fails in the containment is huge.

    So that's the first hypothesis there. There's many, many data points there that are imperfect, but you can start triangulating from them. One of the key points was China is lying on this data. Well, if they were lying, they did an amazing job, because if you looked at all the ratios, such as deaths over cases and things like that, all of them were pretty reasonable and consistent.

    If you only have one data point though or one data source, like China, that's not very reliable, but as soon as you start having South Korea and Iran and Italy, now you have four sources from different countries, different organizations. And if you see that these ratios are converging in the same direction, now your confidence is dramatically higher. So really, a lot of what I did was that.

    It was looking around the world, where do we already have the data, comparing these ratios and reaching a conclusion. One of the key examples is the case fatality rate, right? At the beginning, still today but at the beginning even more, people said, "This is like the flu." Okay, let's look at the flu. The case fatality rate, the number of people who died, divided by the people who officially have the flu in the US, we can look that up. It's around 0.13%.

    If you then looked at different areas in the world, at the time in South Korea, it was 0.6%. In safe areas of China that didn't get overwhelmed, it was 0.9%. And in Hubei, it was 5%, right? And you can actually see these numbers converge in different directions, and you can make extrapolations on what is going to be the range. So I think that, by the way, is one of the key, key highlights of that is in order to predict something in a chaotic world, you can't jump straight into models, into theoretical models.

    You can only model something theoretically, if you really deeply understand the mechanism that underpins it, because a model is a simplification. And you don't know what to simplify and how to simplify it, unless you've really understood it, but something like the coronavirus crisis is a very complex one with a lot of different reactions that governments or populations can have. So you can't really jump into models.

    So I really didn't rely a lot on models. I relied mostly on what happened in other countries. What did China do? What did South Korea do? What did Taiwan do? And then, based on that real-life experience, extrapolating what will happen in other countries.

    Eric Ries: Explain a little bit about what you were doing at that time, because you're an amateur sleuth. You're pulling data from public sources. You have a day job here in Silicon Valley at an education technology company. So just talk a little bit about the reality of your life at that time as you were starting to post on Facebook and get a sense of the dawning... You had this dawning realization that this was going to be bad in the US.

    Why did you decide or why did you feel an obligation to do more than just look at the data and share it with friends? What drove you to take this next step and go public, if you will, with the data?

    Tomas Pueyo: Initially, it was again just on Facebook, and that was still going public because my Facebook is open. And the level of reactions that I had to that content is about anything else that I've ever shared. Not every one of my friends, but lots of my friends every day when I posted something engaged in debate, thanked me for the analysis. And so, that kept me going, and that became actually more and more urgent and important as days passed, because on one side the fact that this was a pandemic was becoming more and more obvious.

    And the people in my environment and my group of friends were realizing that, because they were following the data, but people outside of that were not. My family didn't believe me at the beginning. My company was cautious about this. They were not moving forward very quickly towards remote work. And so, I was seeing this reluctance to take this extremely seriously everywhere around us, even in Silicon Valley, right?

    A few companies ordered a work-from-home early on, but most of them didn't and people were waiting for the politicians to take decisions, right? For example, Santa Clara had a community-spread case early in March. If something like that happens, you want to close everything, because it's a community spread. It means that you just don't know what's happening.

    Eric Ries: That's right.

    Tomas Pueyo: But people were not, yeah. And so, I first started focusing on the Bay Area. Okay, at what point should you close your office? I explained it to Washington State, because that was ground zero of the United States at the time until it was New York. And then, what happened is all of that analysis was convincing my friends in Silicon Valley but not outside of it. So a friend of mine said, "Hey, I'm here in Paris. I understand what you're saying. People outside of Silicon Valley don't understand this, and you put together an analysis that is relevant for Paris, too. So I can share with my CEO friends, and they can close their offices."

    And I just took all my analysis and put it in one place, and that was my first Medium article is the Why You Must Act Now article that got 40 million views, but I really didn't think about it. My previous most successful article ever had 250,000 views, so I thought it could get up to that maybe but not that much more than that. The fact that it exploded to 40 million was completely a huge surprise.

    The goal of that article was to wake up a lot of people and to have so many people around the world really realize this is a big deal. The problem is once people realized that, they didn't know exactly what to do about it. And one of the first things that different countries were thinking is, "Hey, maybe we should just let this thing run, this herd immunity concept, this mitigation idea of maybe-"

    Eric Ries: It feels like a lifetime ago, late February, early March, as least for me. And I think it's easy for us to lose sight of the fact that these prescriptions were very controversial, and the public was very confused in those early days of the pandemic. So walk us through the argument and what the data was showing at the time of that first article.

    Tomas Pueyo: Yeah, and I love what you say around the mindset that people had, right? The mindset that most people had was, "We've seen this in the past. It happened with SARS. It happened with MERS. It happened with the swine flu. It happened with the avian flu. It happened so many times, and then nothing happens. This is the same." And so, people were feeling very safe that this was not going to happen to them.

    They saw it happening in China, but then it stopped. And then, they were seeing it happening in Italy, but it's just Italy. It's not me. So really, people were not realizing that this is going to come to you, too. That's the mindset that people had, and the mindset is that, "Oh, there's not that many people dying. The flu is something that's pretty bad too," and that we shouldn't be concerned.

    And so, I think that's what this first article of Why You Must Act Now really, really achieved at drilling this idea that this is really bad. And if you don't act right now, you're going to have bodies piling up in your country, the way that it was happening in Iran which was digging, the way that it happened in Hubei where the fatality rate was around 5%. So I think at that point, in fact I've started looking into this and you actually can see the mobility in different Western countries dramatically go down after March 10th.

    And it might completely be a coincidence, but that's right around the time when people really realize, "Oh my God, this is bad." Now the fact that it's bad doesn't mean that we know how to react. At the time, the story that was most well known was the story of China, and China is basically a dictatorship. So the number one argument in Western countries was, "Well, this is bad, but it's not extremely bad. And then, you have China and we're a democracy. So we cannot just contain this."

    Eric Ries: Yeah, and the presumption with whatever China did was bad.

    Tomas Pueyo: Exactly.

    Eric Ries: We're not going to copy what they did.

    Tomas Pueyo: Exactly, exactly. And so, thankfully we have in that corner of the world a few countries that are very strong democracies who did a very good job, and Taiwan is a good example but South Korea is the best, because not only were they able to control the virus, but they were able to actually control a full outbreak without a hammer.

    Eric Ries: Was that clear to you, even at that point, that their strategies were going to be effective? I'm trying to put the chronology together in my own head, and I'm realizing I can hardly remember what happened when.

    Tomas Pueyo: Yeah. So for sure by then, which is March 18th, we knew that South Korea had controlled it. And actually, I'm looking at the data right now in my first article, and we knew it. I just did not call it out very specifically in the analysis. I'm just confirming right now. No, I did, yeah, yeah. So I did.

    Eric Ries: But in that first article, the case was really that Western countries need to take this seriously and take urgent action.

    Tomas Pueyo: Yes.

    Eric Ries: That was the message. I don't know how other people are feeling about this, but it's hard for me even to remember that there was a time when that was controversial and that was a case that needed to be made now that we've gotten used to this pandemic, but before the NBA shut down, before we had those first confirmed cases of community spread, before... I can't remember which it were that tested positive in the early days, it seemed like a problem from over there. And I think we were all in a very severe form of denial about it.

    Tomas Pueyo: Yeah, and I think those small data points that you share are the ones that help us go back in time, right? So for example, I don't know if you remember, but there was a massive debate on whether South by Southwest should happen or not.

    Eric Ries: Right, isn't that wild?

    Tomas Pueyo: Right. And so, so many people were angry about this, and so that's one. And then, the second one was Tom Hanks I think was the first famous person to--

    Eric Ries: Yeah, that's right. That was the celebrity I was thinking of.

    Tomas Pueyo: And just the fact that we thought this was a debate, I think highlights how we're thinking about it, yeah, at the time and how misinformed we were.

    Eric Ries: How did it feel? How did you actually get the news that your article had traveled so widely and had been read by so many millions of people? What was it like being in the eye of that storm?

    Tomas Pueyo: So the first is I pushed the article very, very, very hard and I've never done that in my life. Obviously, I release products at my job. I write articles, but usually I limit myself to making a post maybe on Facebook and that's it. This one was different, because I did realize how misinformed the public was, and I also knew that it was all coming from the right side for me.

    I was not trying to make money out of this, and it was all about the message. So it's the first time in my life that I pushed this to all my networks as hard as I could, and I was also very aggressive on the viral mechanics that I plugged into it. Why You Must Act Now is a call to action. At the end of that article, I use a couple of sentences that say something like, "Sharing this document or this article is one of the few times in your life where you can actually save lives by sharing an article. If you agree with it, you should share it," or something like that.

    That's a very, very strong call to action to put at the end of an article, and I knew that would dramatically increase the virality. The only reason why I added it is because I felt very, very strongly that, indeed, that message needed to be told. In fact, I have not used that again in my latest articles, because I didn't think the message was as urgent and needed to be as widespread, but I was very, very conscious on pushing it.

    Even then, I didn't know it would be so successful. And so, what happened is the day after when I woke up, my phone would be buzzing every three or four seconds with Twitter notifications, with Facebook notifications. And it was literally three or four seconds for two or three days in a row, and then I started receiving messages from friends who were saying, "My father sent this to me. My group of friends from Russia sent this to me. I've received this from three different sources."

    That really creates this image of, wow, this is really going widespread. And then, obviously I have the statistics from Medium.com, which lets you know how many people have viewed your article, and I could see it. Oh, I wake up and it's 10 million people. Three hours later, it's 11 million people. It's all very virtual. It's in the numbers, but that's really, really, really absurdly crazy.

    Eric Ries: Tell us about The Hammer and the Dance.

    Tomas Pueyo: When I published Why You Must Act Now, that was a Tuesday. And by the weekend, a few countries had already started taking measures. The debate after that, that's around the 15th, March 15th was really, "Okay, what should we do? Should we actually close the country, or should we do something different?" And one of the key debates there was led by the UK. The UK had a very strong team of epidemiologists from Imperial College.

    Neil Ferguson is a famous one from them, and one of the main debates was around herd immunity. In fact, I went on TV the Friday around March 13th or something like that with one of these epidemiologists, John Edmunds, and his recommendation was basically, "We should not do anything too aggressive right now. We should wait a little bit, little by little increase our measures."

    And it wasn't clear whether they wanted to just flatten the curve, whether they want to completely contain the virus, whether they were going for herd immunity. It wasn't really clear. And for me, it was crystal clear that if you waited a single day, the crisis would be dramatic. The other thing that I knew that maybe they didn't know is because of my job in product and in marketing, and my experience in storytelling, I have a sense of what you can tell people to influence their behavior.

    And I knew that if you were very, very clear and you told the story well, people would listen and people would stay home, which is not what the team of epidemiologists and clinicians in the UK were thinking. So you had this very dangerous trend of maybe a lot of countries are not going to take the measures that they need to take. And so, I spent the following few days putting all the information together on why I thought you absolutely need to be very aggressive early on.

    It's a deep analysis of what do you do if... What happens if you don't do anything? What happens if you just do enough to mitigate the virus so that your healthcare system doesn't get overburdened, and what happens if you actually go much more aggressive and you really contain this? Then, you crush the virus, and then you start handling the virus after that. By that time, not only did we know what China had done and we knew that China had controlled the virus, but we also knew that South Korea had done it too, and they had done it within three weeks.

    So we knew we had at least two examples of the fact that we can do this, and we can do it also like South Korea, which is a democracy. I think the last thing that people didn't know is just how to think about this. What measures should I take, and how should I think about each one of them? And I think the key additional factor that I added to the conversation is, like nearly all decisions in life, this is a cost-benefit analysis.

    Just look at your measures in terms of cost-benefit. Your benefit is the reduction in the transmission rate. The cost is the economic cost, and just try to optimize these things. Right now, you don't know what you're doing. So just completely lock down the entire country, and now you buy yourself time to figure out what to do properly. What are the optimal cost-benefit measures to start dancing, to start opening up the country, in a way that the virus is not widespread anymore?

    Eric Ries: But what has worked well? What approaches are working and what hasn't?

    Tomas Pueyo: Yeah, it's still early and we don't know all the details, but what we see is a lot of countries apply the hammer and the dance, mostly the hammer first. And now, we're starting to dance, and nearly all of the countries in the Western world that applied a heavy hammer have been able to control the epidemic within a matter of weeks, between seven and 12 weeks.

    Eric Ries: And the hammer is the lockdown, the shelter-in-place-order strategy.

    Tomas Pueyo: That's right, very aggressive, exactly, part of you don't know what's going on. You have a virus that's widespread. You don't know where it is. So you just shut down the country. You make people stay home while the caseload goes down, and you buy yourself time to figure out what to do. So you have countries like Australia, New Zealand, Estonia, Lithuania, Latvia, Iceland, Ireland, Spain, France, Italy, Germany, Norway, Denmark, Finland and many, many more.

    All these are countries that have applied a hammer and really got the caseload to a level where they can start thinking, "Okay, it's time to start reopening the country." And then, many of these countries realized what they needed to do to move forward into the dance, this phase where you don't need these aggressive measures anymore. You can replace them with intelligent and much cheaper measures but still contain the virus.

    For example, instead of locking everybody out, you might be able to identify who is infected and who might be infected, and and you only isolate those people, right? So that's one of the core measures to control the virus. So many countries were able to figure that out and start playing with it, and as a result started opening the economies.

    And you have most of Eastern Europe, for example, that has been able to start reopening the economy without severe outbreaks. Countries like Spain have started opening up again. Many of these countries have ordered masks, for example.

    Eric Ries: As you got into all this data, what's been the most interesting, surprising or shocking? You've unpacked it all.

    Tomas Pueyo: One of the most fascinating debates has been the people that still push for the herd immunity case, and I think it's a very interesting and fascinating conversation to have. It highlights the only country that has really decided to very officially form a strategy that doesn't lock the economy down, that's Sweden. Sweden decided, "You know what? This is not as bad as we think, and we cannot contain this virus. So let's just keep it open and try to limit the number of deaths."

    So that is really a debate that is anchored in data, even if unfortunately Sweden didn't make that data explicit, but really the debate that you're making here is, A, doing a lockdown is not better for the health, because regardless this is going to become endemic anyways and everybody's going to catch this. And, B, it's not as bad as we think and then, C, also locking the economy is very bad for the economy.

    These are three statements that you can look at data to decide whether that's true or not. For example, in the argument of you cannot contain this, well, I think empirically that you can look at countries like China, Taiwan, Vietnam or South Korea who have been able to contain this. So when you're making that statement that you cannot contain this, I think there are examples, empirical examples, where you could if the burden of proof is on your side and Sweden didn't say anything about this.

    The second argument was, "I don't think many people will die from this." And the argument there was the case fatality rate, the number of people who die divided by the official number of cases, is high but the true number of death is going to be low. The infected fatality rate, so the deaths over the truly infected, not just the official cases is going to be very low and is going to be similar to the flu.

    That statement is another one that's based on data. You can go into the detail of the data, if you read whether that's true or not. And you can see for case fatality rate for the official death, you can see that the flu is 15 to 20 worse. And because the flu is such a low-fatality illness, there's no numbers on the infected fatality rate. There's no number on the true number of deaths [crosstalk 00:34:11]-

    Eric Ries: We don't know what to compare it to.

    Tomas Pueyo: Exactly, we don't know who to compare it to, right? So there's two things that you can do there. One of them is let's look at the studies on infected fatality rate as they come in, and the Santa Clara one was a famous one, which was suggesting that the infected fatality rate was very low, 0.1%, that it was very flawed and there was a lot of problems with bias. And the people were assembled and false negatives and things like that.

    So you want to look at all the data from across the world and pick the best examples. And so, for example, one of the best ones is the Diamond Princess cruise, because it's nearly a perfect test. You have 1,500 people locked in one place, and you let these run loose. And what happens? Well, it happens that the lowest threshold there of deaths was around 0.7, 0.8% infected fatality rate, and that was the very lowest possible but you know now you have a lower bound of a fair amount of deaths.

    And that's how you pick a little bit of the data to figure out what's true and what not, and then the same thing happened with the economy. One of the bets there that Sweden is making is doing a lockdown is too bad for the economy. And so, the question you can ask yourself is, okay, how can I look at data in the real world to figure out whether that's true or not? There's not a lot of data about this, but the one data point that we could look at is what happened in the 1918 pandemic and what we saw there.

    Eric Ries: Which has been well-studied in the intervening years.

    Tomas Pueyo: Exactly, and the US has been amazing at studying it. It was a big continent where there was enough different cities that were distant enough that you could isolate the epidemic in each one of these cities, but all of them in the same country so we have proper data about it. And you would assume that the cities that have higher mortality because they had weaker measures are the ones who'd have a better economy one year later.

    Eric Ries: If it was true that lockdowns were harmful to the economy.

    Tomas Pueyo: Exactly, but what you found is the opposite. The cities that were the hardest in the lockdown for the longest period of time were the ones who had a better economy one year later. And so, out of all the data that exists in the world, very little supports one case or the other of herd immunity versus hammer and the dance, but the one data point that we had was that hammer and the dance was actually better, not only for the health but for the economy.

    Eric Ries: Well, and this is the thing that has been hard for me as a bystander, as an observer of all these debates. One of my old Lean Startup sayings is that metrics are people too, and it came up in my conversation with Brian Chesky, too. It's a very common confusion people have when you reduce people to numbers, like in the economy. You have this idea that, well, if we protect the numbers by sacrificing the people, then that will somehow work, forgetting that an economy is made up of people.

    And if the people are dead, that's not actually very good, very healthy for the economy, not least of which as many of the people are educated and will refuse to transact economically, even if you do reopen. So it seems like there's been this mass denial in certain countries, in certain states, driven it seems like by political leadership that somehow we can avoid these hard decisions, and it will somehow work out.

    What's it been like to be on the other side of that? I was going to call it an abyss. I don't even know what to call it. How do you even begin to make the case against such a bad idea?

    Tomas Pueyo: It's funny, because you remind me a lot of the conversation around two decades ago when Daniel Kahneman wrote Thinking, Fast and Slow making people realize that, well, maybe economics is all behavioral economics. And so, if everybody is homo economicus, then you're never going to figure out the truth of the economics. So yes, I agree with you that you need to understand the psychology of humans to really understand what's happening.

    And for me, I think the number one mental pitfall here is the speed of incorporating new information. The same thing happened with the entire crisis. People did not incorporate the new information that was coming, that was telling them, "Hey, this is something serious, and the world is going to change." And I think that's very natural. You know this, because you've shaped products too, where your intuition as a human is going to be very frequently wrong, and you cannot assume that what you think is going to be the right product that you put in the market is going to be what people want.

    In fact, you have to eliminate your preconceived opinions, and you need to listen to the data and incorporate that data in shaping products. That experience that is so humbling about the fact that you know nothing about the world is not an experience that most people have. For most people, they're allowed to have confirmation bias in their daily lives, because the world doesn't change fast enough to prove them wrong.

    They can keep their same stories about how the world works, and that keeps them safe and it takes them a long way. Here, you have a situation where that's not valid, where the world as you knew is gone forever and that is a very hard mental jump for people. Whenever they say, "Reopen the economy," what people mean is, "I want to go back to where we were." That's why they're saying, "We don't want to close the economy."

    What they mean is, "Okay, this thing is going to pass and we're going to suffer, but then then that way we can have back the economy that we had," but that's not true, because now you have this new element that completely changes the world. The world will never go back to normal. And you need to understand, okay, what are the ramifications of this new virus coming? And the key ramification is people are going to be scared as hell to go out.

    Some people will want to do it, but many won't. And those who don't want to go out because they don't want to infect themselves, because they don't want to infect their partner who has diabetes, because they don't want to infect their grandparents who's 90 years old in a residence. These people are not going to go out for months or even years, and that's going to be depressing the economy much more than if you do a short-term aggressive hammer, and you contain the economic downturn to a few weeks. And then, after that, you can open up the economy.

    Eric Ries: I've been really shocked how many people I know educated, wealthy, privileged who have convinced themselves that they're an exception to the rule. So they nominally support the lockdown. They think it's a good idea to act aggressively, but they have to be able to go out and just do this one thing, or there's a party that they want to go to. And they'll find a way to make it social distance and the motivated reasoning that is driving that behavior, I wonder are we seeing that in the data on a societal level? We're not really taking this, even now, as seriously as we need to.

    Tomas Pueyo: I love that one, because that's the typical conversation that you're going to have about others is, other people are always going to have these biases, but I'm a pure person. For me, what that means is I actually watch myself constantly to be sure that I don't fall into these pitfalls. And for me, one of the key ones has been avoiding the human tendency, again for confirmation bias and proving that it was right. So if you go very publicly saying, "The hammer and the dance is the right way to go-"

    Eric Ries: You're committed to that.

    Tomas Pueyo: That's right. And how do you look if suddenly it turns out that it was wrong, and you are the person who caused the trillion-dollar impact on the world economy, right? And so, that is actually a mental pitfall, and I have caught myself trying to do that, looking for data that would confirm my bias. And so, as soon as I did that, I established what are the numbers that would convince me that, indeed, that was the wrong strategy.

    And so, the number that I put myself is on the infection fatality rate, you would want that to be close to the flu, so maybe 0.1%. If only 0.1% of people die, then that's good. The other argument that you could use-

    Eric Ries: And multiple countries, you were looking at if their fatality rate had converged on that number. You would have said, "My hypothesis was falsifiable."

    Tomas Pueyo: Yeah, exactly, exactly, right? And it doesn't mean that the decision was wrong at the time based on available data, but at least this is a factor that says, "My conclusion is now different, because my data is different." That's one. Another one is the ability to isolate old people, and one of the variants of herd immunity, which I think is a very valued one, is let everybody catch this except for old people and people with comorbidities.

    And those people, you're going to isolate for a month or years until we find a treatment and vaccine. The problem that I see with this is, A, in countries like the United States, there's 45% of the population that is either of old age or has a comorbidity like obesity or heart conditions, right? So you can't isolate 45% of the population. Even if your country's healthy, like Sweden, can you actually isolate old people in residences for two or three years?

    And the answer, their belief was, yes, you can, but then more than 50% of the deaths in Sweden have been people in residences. So far, you cannot do this. It's a bit like communism. It sounds really, really cool, great idea, but in practice it's really impossible to isolate so many people for so long, but that would be a falsifiable claim. You could prove that people can be isolated successfully.

    And then, the last one is the economy, right? You can actually prove whether a hammer and the dance or herd immunity strategy are more reasonable, and you can prove that in retrospect, in a year or two when we have all the data. In the meantime, you want to look at all the leading indicators that you can find. And the best one that I think you can find is the markets. The markets predict whether, or try to predict, how the economy's going to fare.

    And what you see is that in Sweden, right now the main index is actually equal or worse than the main index in other Scandinavian countries. So the markets don't believe that Sweden is going to fair economically better than other Scandinavian countries, but these three are data points that actually can end up being different, and as a result prove that my strategy ends up not being the right one. And if that's the case, then you want to shift your conclusion despite your confirmation bias that's going to try to support it.

    Eric Ries: Tell us about something you got wrong.

    Tomas Pueyo: So many things. One of them was a suggestion that the speed of viral mutation was going to or could be very fast. There's a lot of actual early indicators that the virus is mutating, right? It's an RNA virus versus a DNA virus, which tend to mutate very fast. The RNA are faster than DNA, and it's also in the family of influenza viruses. And as we know, influenza mutates fast enough that within one to two years, you catch a new one and you're not immune against it.

    So the hypothesis there was if you go for herd immunity, maybe in a few months or a year or two, it was worth it because you don't catch this again. That was very well-stated as a hypothesis, a fear, but it turns out that the level of mutation is not as fast as we feared. So it is likely if you catch this, you will be immune for some period of time. We still don't know whether it's one year, two years, five years, but at least it looks like it's safer than we feared at the beginning.

    And there's many, many more things like that. I think another one was for masks, right? There's been a lot of conversations around masks. Are They Good, Are They Bad is an amazing paper by Jeremy Howard and all the co-authors.

    Eric Ries
    : It was Zeynep too, co-authored-

    Tomas Pueyo: Yes, that's right.

    Eric Ries: Going to their op-ed and to the paper.

    Tomas Pueyo: Amazing paper looking at a dozen of those other papers, gathering all the evidence around is a homemade mask better than the alternative. So that was a very sturdy article, but then there's always some potential areas where these can be flawed. And one of them can be, well, if the masks are not properly put and as a result, people are not very well protected, but that makes them feel safe and they go out, then maybe that's actually counterproductive.

    And so, there's always these debates, and I think these debates are crucial because it helps us reach better conclusions. I think in the case of masks, just to be clear for your audience, they're absolutely great and we should absolutely be wearing them, especially to protect others because we never know when you're sick. So we need to prevent others from catching this, but these debates keep happening all over the place about all the data points, and it's very important that they do.

    Eric Ries: What's your advice for people who are having trouble wading through all this disinformation so that they know what's safe for them to do, what's right for them to do, for them and their family?

    Tomas Pueyo: Yeah, I think you're actually touching on two very different points. One of them is just an individual person's ability to see through this, and then there's the other issue of political polarization actually that I think we should touch on. On the individual side, the interest in coronavirus has subdued compared to what happened a couple of months ago, and people are tired of reading all this information.

    And the key takeaway is this. The virus spreads mostly when you are in a confined environment with a lot of other people singing, touching and talking to each other for a long period of time. If you avoid all of these factors, you are probably safe. So for example, being at home with your family, that's a confined environment when you speak with a lot of different people, with your family members for a long period of time.

    So that is very highly likely to create infections. A meeting is very bad. You are talking for a long period of time with other people. A music concert is very bad. A choir is very bad. Conversely, if you are walking outdoors with friends and you're talking to the wind, and you're two meters apart, that is not problematic. So understanding these rules of thumb is very important.

    Obviously, also masks and hygiene is a crucial thing. If you only do these things, that is a way that you can protect you, or yourself and your family members and your loved ones. And you don't even need the government to help you there. I think the other topic is on polarization and the fact that in this country, more than in any other country that I've seen, you have a different opinion on what to do about the coronavirus that is based on the party that you're in.

    I don't have a solution, but I think it is very difficult to only rely on people there, because if the leaders consistently share a message, usually people who follow those leaders are going to follow that message, because the herd mentality and the us versus them is such a strong psychological factor that you will listen to whatever your leader says. And so, there, I think we can obviously appeal to people's reason through science, but I also think that for a big chunk of population, this will not be possible, if the leaders are not also brought in.

    Eric Ries: What are the patterns you've noticed in terms of which governments, both nationally and at the state level, have been effective in their response, and which ones have not been?

    Tomas Pueyo: Yeah, one of the things that I love is comparing the US with Europe, because in both cases you have a lower sovereign level and then a high sovereign level, the states and the federal government in the US, and the countries and the European Union in Europe. Interestingly, the default sovereign level in the US is the federal government, whereas in Europe it's the countries.

    And so, usually in every other country in the world, what you see is the higher sovereign level is the one that take ownership of the problem and tries to solve it. And it makes a lot of sense, because in a pandemic like this one where you need to make a lot of decisions really, really fast, you need central coordination. Otherwise, you end up having, for example, what we saw in the US is states fighting against each other, competing against each other, for ventilators and masks and things like that, but you want the high level to make the decisions.

    In the US, that was the federal government, but the federal government relinquished power. In Europe, the default of sovereign level is the countries. So even if it would have been better for the European Union to do it, that was not the default. The countries did it, and that worked because each country was equipped to do it. They had epidemiological centers. They had plans to this.

    Yeah, so that probably worked. Because they're sovereign, they can close the borders with each other. The problem that happened in the United States is that every state was forced to behave like a country, but it was not equipped to behave like a country. Many didn't have equivalence of the CDC. Many had no idea how to deal with a pandemic like this one. They didn't have experience buying bulk from the government things like masks or ventilators, because they're states.

    They're not used to the mental concept that, "Oh, I can close my borders." Even today, many states have been able to do that. Hawaii and Alaska defacto have closed borders. Everybody that comes in needs to have a two-week quarantine, and it's enforced but most other American states haven't done it. Many have a two-week quarantine encouraged, but not enforced. And so, that's a problem, because you have a state, for example, like, I don't know, Idaho which is doing really, really, really well.

    And maybe there's people from Georgia who are traveling to Idaho, and they are seeding the coronavirus in the community. And you definitely don't want to do that, if you've done a good job at controlling the virus. And so, I think the main struggle has been that one in the US. The higher sovereign level has relinquished its power.

    States have been left to fend for themselves, and they don't have the mindset or the experience to do it. So they've had to learn as fast as they could. And given that, I think they've done a reasonable job, not all of them but many.

    Eric Ries: Give us your assessment of how we're doing here in California.

    Tomas Pueyo: Yeah, I think we forget now, but it is incredible how fast politicians were at taking measures. The one that should be called out the most is probably London Breed. She was relatively newly elected, and she took a massive stance of calling the emergency before there was a single case in San Francisco and before any other-

    Eric Ries: We're very grateful to her for that.

    Tomas Pueyo: Yeah, yeah. And before I think most or any big leader in the country did it, and now it looks obvious, but at the time that was a huge political bet that you're making. If it turns out that it's not a big deal, then you don't look like an intelligent leader. So very, very big kudos for her. And then, Gavin Newsom very, very quickly also reacted to this. I think a couple days after I published Why You Must Act Now, the measures were starting to be taken in California.

    There's a couple of interesting things that happened. First, the population was already reducing its mobility before there were official measures. So I think the population there helped. The fact that, for example, in Silicon Valley so many people are informed helped a lot, and we have to remember that this is especially bad in urban areas, right? So the fact that the Bay Area, one of the two or three big urban areas in California, was already staying home before the shelter-in-home order, I think that was good.

    The same thing I think happened in LA. I think with the measures, they were regressive and relatively early, and I think that was good. One of the problems I think is that it was a one-size-fits-all, and I think that's problematic because you have, for example, areas in Central Valley where people depend mostly from the work that they do outdoors and where you have communities without a single case, and they had to follow the same order as the people in big cities like San Francisco where many people can work from home anyways.

    And so, they're not as impacted. So I think that one-size-fits-all was a bit problematic. It's understandable, given that it's very hard to make very intelligent decisions without a lot of data and without a lot of time to think about it, but that was a bit harsh. And I think all in all, the state is making reasonable decisions on how to open, in what order, and more importantly under what conditions, for example, right?

    The cases need to be at X level, and they must be going down and you need enough testing, and that means X numbers of tests, and you also need enough contact tracing. So all these conditions I think are exactly the way you'd want to be ending the epidemic.

    Eric Ries: Do you want to talk a little bit about your political article, the U.S. divided and all that?

    Tomas Pueyo: I'm happy to do that.

    Eric Ries: One of your more recent articles has been about the political polarization in the US and about the need for us, as a country, to pull together. That's a pretty brave topic to address so openly. Not everyone who has been involved in the corona response has been willing to address the politics of the situation. Why did you feel compelled to write that? And recap your argument for those who haven't seen it.

    Tomas Pueyo: Yeah, I think it's interesting. It's actually connected indirectly to the question that I get a lot, which is, "What you did for coronavirus is amazing. Can we do that for climate change?" So I'll talk a little bit about that, and then I'll go back to your question. And my answer to that is no. You cannot do the same thing for climate change. The reason is because there's a few factors that make the coronavirus very unique.

    One is it affects the entire world. That's like the climate change. And two, the consequences are dire like the climate change. In fact, the consequences of climate change are much worse than the ones for coronavirus, but the two factors that make the coronavirus different is one of them, this is light speed. Within days, the entire situation happens. So the urgency is dramatically higher than it's in the decades.

    And then, the last factor is nobody knows about this. There's no stance on this. And so, as a result, everybody is open to learn as much as possible. These four factors, you only have two in climate change, and the other two you don't. Climate change, it's in the decades, and also you have a lot of people who have already found their opinion, and then you have confirmation bias leaking in.

    Many people already have a conclusion, and they're feeding the data to the conclusion. In the U.S., what I saw after the hammer and the dance is that most countries were taking the right decisions, but the U.S. wasn't yet. And we had this key window in March and early-April where nobody, either at the federal level or the state level on the democratic side or the republican side, had a very definitive position about it.

    You already had Republicans on the republican side leaning towards more openness to the economy, and the democratic side more towards the health and lives. That was not a crisp delineation. My goal there was trying to make this a data-driven nonpartisan argument, and the reason why I thought that was not only desirable but more currently achievable is because Republicans actually have the most to lose by this, by the coronavirus.

    The default response of a Republican usually is going to be more freedom, less intervention from the government, but also they default to the economy's really, really important. So one of the things that I wanted to highlight is this is bad for... If you let this go and you don't control it, it's going to be really, really bad for the economy, not only for health but also for the economy.

    So if you really care about the economy, you should control this. The second argument that I wanted to make is one around how self-serving fighting the coronavirus could be. I realized that Republicans had not yet realized how bad the coronavirus could be for their constituents. Republicans are in general older, and they are in general also less healthy than Democrats, not because of who they are but rather the fact they're people in more rural areas and to also be older and also have more comorbidities.

    And so, I wanted to highlight the fact that, well, it's going to be worse for you, Republicans, if you don't control this. You're going to have more people dying, both because they're older and they have comorbidities. And the impact in the elections could actually be dramatic. For example, just straight deaths for Pennsylvania could account for 30% of the gap between Trump and Hillary in 2016, right?

    So 30% of the elect rate that pushed Trump in Pennsylvania, which was a swing state, could die directly from the coronavirus, right? I think that's huge, and then the last thing I would try to do there is just explaining the early polarization to a very reasonable fact, which is the fact that urban areas are both more connected and dance than rural areas. They also tend to be more democratic.

    If you're more urban and more connected, you also will have more coronavirus cases earlier on. We saw that in New York, for example, very connected to Italy and a lot of cases very early on. So there was a correlation, but not a causation between the fact that you will be hit early by the virus and being Democrat. That did not mean that as a rural state you would not be hit, because what we see in all pandemics is that they take a longer time to reach rural areas.

    And when they do, they hit hard. And so, for all of these reasons, the economic reason, the self-serving reason and the fact that this was not as much ideological difference but a more rural-urban difference, I thought we had this narrow window of time where we could write an article to influence politics at the national level in the US. I tried, but I think if I succeeded, it was more at the state level but definitely not in all states and definitely not at the federal level.

    Eric Ries: What's the data showing right now? What are you working on these days to look forward towards the next phase of the pandemic?

    Tomas Pueyo: I'm working on three different things. One of them is finalizing the dance. What are the recommendations for dancing properly? And one example of this is you have many states and many plans that recommend a number of contract-tracers based on the population of the state, right? For example, I need, I don't know, 10 contract-tracers per 100,000 inhabitants, which makes no sense, because if you have two states that have a million inhabitants and one of them has 10,000 cases, and the other one has none, should both of these have the same number of contact-tracers?

    No, and so being clever what are the different metrics that you want to follow and what are the different goals that you should achieve, I think that's the most urgent thing, given that so many states and countries are moving into the dance without being properly prepared. That's the first one. The second one is updating the debate around herd immunity versus hammer and the dance.

    And I think it's a very important one, because we're not in this for a few months. We're in this for maybe years. And so, it's always going to be tempting to say, "We give up and we're just going for the herd immunity." That's in fact what we're seeing in many states in the United States, whether Georgia, for example, or Florida, admit or not.

    Eric Ries: Been really painful to watch.

    Tomas Pueyo: Yeah, it's painful to watch, but that's the de facto strategy that they're following. They are basically saying, "You know what? I didn't control this. I don't want to go through the problem of controlling this, and so I'm just going to open up the states." And the result is going to be bigger outbreaks, bigger maximum number of cases, collapsed healthcare systems, a lot of deaths.

    This is a constant debate, and I think it needs to be updated all the time based on available data. So I'll be looking at that. The last one is the hammer and the dance only is relevant if you can do the hammer, and you can do the dance. It is not the case for many countries. For example, both Peru and India have had a pretty dramatic hammer applied, but in both cases, the number of coronavirus cases has been going up during the hammer.

    So if you can't even control the virus during the hammer period, it is unlikely that you can control it during the dance. And also, not only the benefit of the hammer and the dance is lower, but also the cost is higher, because fewer people can work from home. More people depend on a daily income to eat. And so, you can't assume that what's valid for Western countries is valid also for developing countries.

    And so, I'm looking into what are the right strategies for them. In fact, it is depressing. I talk with people in Kenya, in Peru, in Mexico and in Bangladesh, and it is just so hard. They are in this bind where it sounds like they're forced to go for herd immunity, but they don't want to. In fact, you do need to look at the details, because the details matter. And you look at an example like Kenya, for example.

    Kenya did not brush the curve, but in fact they've been pretty stable at a quite low number of cases, but the economic toll has been very, very heavy, right? So they're wondering, "Okay, did we succeed or did we not, and should we open or should we not?", with interesting facts such as, for example, Kenya has experience with Ebola contact-tracing. And so, they can use that to reduce the epidemic in the dance and moving to the dance faster than Western countries can.

    You also have natural AB tests there where, for example, Rwanda, Burundi have been pretty good at also applying a hammer and having very few cases. Whereas, Tanzania, which is another neighbor of Kenya, did not apply hammer and very few people hear about this, because the official data does not show deaths and cases and all that thing, all that stuff, but anecdotal evidence shows a collapsed healthcare system and people dying on the streets.

    And so, this is an interesting situation where you have a completely different set of data points that you need to process with a completely different cost-benefit for you to know what is the right solution. And the stakes are huge, because here we're talking about Kenya and Tanzania and all these countries, but what about India, 1.2 billion people? If they get it wrong and they go for herd immunity, what happens with 1.2 billion people, coronavirus running wild?

    Is that then containable into only India, or the entire world gets affected? I think these are some of the very hard decisions that we need to make, and it's a bit unfortunate that we are still in a world where there's 200 sovereign countries, and there's only very few overarching organizations that help, because if the World Health Organization, for example, had been better organized, not as politicized and had had more power, there's a world where the coordination across countries could have been substantially better.

    And we could have taken the right measures. For example, if it turns out that the right thing for the entire world is for India to contain the virus, but India cannot afford to contain the virus, there's an argument to be made for Western countries to fund India to contain the virus, but you just cannot even conceive that, because we don't have an organism that is multinational that can have that level of coordination and transfers of wealth.

    And so, I think that is one of the things that I want to see happening and I believe are going to be happening over the next few decades, the same way as in the past, for example, you have the IMF or the World Bank that have emerged as stronger multinational organizations that do influence decisions across the world. There might be a World Health Organization or another type of organization that might emerge for health, for pandemics, for health in general and hopefully for other types of disciplines in the world.

    Eric Ries: What do you hope this is going to mean for you? Do you think when the crisis passes, you're going to go back to the life you had before?

    Tomas Pueyo: I've been very, very, very careful to separate these two things. One of the things that drives me the most in life is to generate love with my friends, with my family, with society in general. And the way to generate love in society is to have as big an impact as possible. And so, thanks to this, I've had more impact than I could ever dream of having. So I'm just pushing that as much as possible, and I've been very careful to keep that very separated from my personal gain, because I did not want to have misaligned incentives.

    If something was right for the world and for the impact, and that was bad for me, I did not want that to influence my decision-making. So I really separated these two things, and I'm pushing as much as possible the message as much as I can. My goal was as I push this, the world is going to catch up, and I will have very little to contribute anymore. And so, I can start thinking of, okay, what does this mean for you, and what can I do about it?

    And so, I think we're right at that phase right now. So right now, I'm thinking, okay, is there something that I can do that aligns with what I want to do in the long term? Thankfully, one of the things that I always wanted to do in the long term was what I've done for the coronavirus, taking big problems, understanding them, breaking them down, finding solutions and communicating about them.

    And so, that's what I'm exploring right now. Can I use what happened with the coronavirus to replicate this? So I have some thoughts. I had a few offers for books, something that's interesting. I work with a group of volunteers that is super, super strong and super energetic, and they want to go into the direction of building a philanthropy to pursue these goals.

    And I'm in general just talking with people like you and with other people who have experience in having a career around content and ideas that they have. So if you or anybody in your audience has ideas on how to push that, I think that's definitely something I want to explore.

    Eric Ries: Where do we go from here? How do we get out of the crisis?

    Tomas Pueyo: The fear that I have when I hear that question is that there's an undertone. There's an underlying question, which is when do we go back to normal, and I know that's not what you mean but that is how many people are going to interpret that question. And so, I think it is very important to state that normal the way you conceive it, which is how people might conceive it, which is going back to how the world was in the past.

    That normal will never come back. The world that existed is not coming back. And so, there's two different terms here. There's the two short-medium terms, and there's the long term. And the divide between them is the discovery of a vaccine or a treatment. Short-medium term is before that, and long term is after that. So in the short to medium short, what's going to happen?

    Each country will be making different decisions on how to handle the coronavirus. Some of them are going to be successful at the hammer and the dance, which means that in a matter of weeks, they will be back in the world where things are relatively like they used to be. They will be able to go out and do most of the activities that they used to, not all of them. For example, business fairs might be very problematic for a long time.

    For example, traveling internationally for tourism might be very problematic for a long amount of time, but broadly if you use a mask, if you use physical distancing, if you're careful and if there's not a lot of cases in the community, we will be able to do most of what we used to. There's going to be outbreaks. For example, there was another outbreak last week in South Korea based on a guy who went to a few clubs one evening.

    France reopened schools a week ago, and 70 of them have already closed out of tens of thousands. So very few, but they've already closed. So that's going to be the new normal, being careful for months, working from home as much as we can, hoping that outbreaks don't happen in your area. And if they do, then potentially having a small local hammer applied. The long term I think is the most interesting one, because the world will change.

    We will all have had a common experience for months, for years, that will have changed our habits. And that's the hardest thing to change for humans, habits, but if the entire world suddenly changes their habits and adapts new habits, that is going to have a long-lasting impact. There is an obvious way where that's going to be true, which is the ability to work from home.

    As you know, companies like Twitter have decided to be full-remote from now on. Companies like Facebook have decided that people are not going to come back until September or some until 2021. More remote work will mean also less business travel, and it will also mean a change in the real estate industry, because suddenly the benefit of living in cities is lower. Whereas, the cost is the same.

    And so, I do think unlike in other crises, there will be an exodus to outside of big cities. I don't think it's going to be dramatic. I don't think 20% of the population's going to leave San Francisco, but it might be enough to actually tilt the real estate industry. And then, there's more industries that are going to be impacted, and it's harder for others to know exactly what it's going to be, but you can explore what it's going to be like.

    And I think for me, one of the ones that is top of mind is universities and colleges. My job at Course Hero is focused on helping students study, especially college level. And universities right now are in a bind, because colleges that have a campus, what they do is quite bad for the spread of the virus. You have a bunch of adults that are co-mingling in parties, in dorms, in classrooms.

    It's different networks mixing with each other and talking a lot. They're touching each other. And so, all of that is really, really bad for the spread of the virus. So campuses are a bit dangerous right now, but there was already a fight between campus schools and online schools happening, online schools growing. You have something like Lambda School, right? Yeah, that's very, very important and a very interesting trend.

    And traditional schools who defend the campus experience is unparalleled. If that's true, then very few people are going to sign up in September, because why would you sign up if you cannot go to college, to campus? If that's false, then it's also bad for campus colleges, because it means that their education is not much better than online education. I think something is going to-

    Eric Ries: Have it both ways.

    Tomas Pueyo: Yes, exactly. And so, I think that's a very, very difficult situation, and we'll be talking with university presidents and educators to figure this one out, but that's what I'm close to. And I'm sure there are dozens of other industries that are going to be like this.

    Eric Ries: Certainly. Tomas, I want to thank you for taking time. I know this has been a incredibly busy whirlwind experience for you, and I don't know how you have time to eat or sleep with the volunteers, the incredible output and the research and just the depth of care that goes into each of the articles that you publish.

    Tomas Pueyo: Thank you, Eric. In fact, I want to say one of the biggest positive surprises of all of this has been actually meeting people like you, where I obviously had heard your name working in Silicon Valley. And so, thanks to this, I've been in contact with people like you. And one of the things I discovered is how careful and how thoughtful and caring you are, and people like you are, in not only everything you do and you say, but also in just making the world a better place.

    And I'm really not saying that for pandering. You really were super supportive early on with me and just reaching out to say, "Hey, how can I help? No strings attached, just how can I help?" And that level of generosity, I had not been frequently exposed to, and it definitely was true for you and for people like you. So thank you for that.

    Eric Ries: Oh, well, thank you for saying so. That's incredibly kind and I want to make it super clear the debt still runs the other way. You've done so much for so much of us. So we're all standing by to help, and I hope that many of the people who are listening to this will take inspiration from your example and get in the fight, think about how they could use their unique skills and background to be of service at this time. If folks want to get involved with what you're doing or get in touch with you, what's the best way?

    Tomas Pueyo: The best is actually both Facebook and Twitter. My Twitter is @tomaspueyo, T-O-M-A-S P-U-E-Y-O. And I tend to listen to both DMs and engagements in my tweets. On Facebook, I have actually a pretty, pretty intense community and I post nearly everything I'm going to publish later on, on Facebook.

    And I found that debate to be more intelligent and thoughtful actually than on Twitter. On Twitter, you get a lot of random people who want to score points. Whereas, in Facebook, because you have this personal relationship, people are much more thoughtful.

    Eric Ries: Awesome. Well, we will put links to both things and to a few of your articles for those who want to learn more and get more involved.

    Tomas Pueyo: Awesome.

    Eric Ries: Thanks so much for your time.

    Tomas Pueyo: Thank you.

    Eric Ries: This has been Out of the Crisis. I'm Eric Ries. Out of the Crisis is produced Ben Ehrlich, edited by Jacob Tender and Sean McGuire. Music composed and performed by Cody Martin. Hosting by Breaker. For more information on the COVID-19 crisis and ways you can help, visit helpwithcovid.com. If you are working on a project related to the pandemic, please reach out to me on Twitter. I'm @E-R-I-C R-I-E-S. Thanks for listening.

    Wednesday, August 26, 2020

    Out of the Crisis #20: the founders of Bitwise on the role of technology in empowering people, spreading benefits to underserved communities, and the creation of OnwardUS

    Jake Soberal and Irma Olguin started Bitwise in 2013 with the idea that the technology industry could be used to fix a city--in their case, Fresno, CA. "Our fundamental thesis is that people of color, women, communities of concentrated poverty, have immense talent to contribute to the technology industry," Jake explained to me. "In addition, those humans, collectively, are the majority of America and they reside disproportionately in non-primary markets. That thesis to us, doesn't feel controversial. It feels really, really obvious."

    In order to do that, they decided three things were crucial: teaching people to code, creating a sense of place around the tech industry, and proving it's possible to build and ship world-class software from places like Fresno. Seven years later, they've trained about 5,000 students and created over 1,000 new technology jobs in Fresno. 200 technology companies have chosen to locate in the city's downtown, occupying 250,000 square feet of space. In other words, they've more than proved their plan can work--so much so that Bitwise now operates in two more cities and plans to keep growing.

    When the pandemic hit, Irma and Jake turned their attention to another problem. They founded Onward, a platform that matches displaced workers--usually, hourly workers--to industries that are hiring rapidly right now. The goal, Irma said, was: "Let's answer the requirements of this moment in helping people survive. And let's do that in a way that feels genuine to us." Onward provides "life essential services: food, shelter, money, childcare, training, and jobs" really running the gamut of what people need to move through the pandemic's impact on employment. The platform is currently in ten states and serving hundreds of thousands of people.

    The three of us spoke about the role of technology in empowering people, spreading its benefits to historically underserved communities, our currently broken employment system and why they believe it can be fixed, and more. As Irma told me, "We don't have to wait for serendipity. We can be deliberate about these things. We can get folks to see their lives differently."

    You can listen to my discussion with Jake and Irma on Apple, Google, or wherever you like to get podcasts.


    A full transcript is beneath the show resources below.


    Highlights from the show:

    • Jake introduces himself  (2:58)
    • Irma introduces herself (3:13)
    • Irma discusses quarantine and finding the equanimity to lead a company right now (3:33)
    • Jake's quarantine and perspective on the pandemic and where we are (5:48)
    • The current situation in Fresno (8:31)
    • Why they chose Fresno as Bitwise's headquarters and Irma's background (10:34)
    • Why she went back to Fresno after college (14:28)
    • The choice of entrepreneurship instead of the corporate ladder (17:31)
    • Jake's background in Fresno (20:46)
    • Irma's first entrepreneurial steps and how Bitwise came to be (22:56)
    • How Irma started a software competition in Fresno and met Jake (26:37)
    • Jake's take on how and why Bitwise came to be (29:26)
    • Why Irma wants to empower others and staying true to that mission (33:51)
    • Bitwise's growth trajectory and where it is right now (35:23)
    • The creation of Onward California (41:03)
    • What OnwardUS does and how it works (45:29)
    • The surprises in building Onward and the disconnection in unemployment services (47:29)
    • Irma gives an example of the kind of person they aim to help (51:54)
    • Their hopes for the future of Onward (53:34)
    • On how present circumstances have revealed a broken system and why Jake is optimistic (55:51)
    • What success looks like (57:54)
    • The importance of universal basic income (UBI) (58:09)
    • Irma's hopes and dreams for what's next (1:00:24)
    • How to ensure we don't waste this opportunity to rebuild something better (1:04:12)
    • How we get out of the crisis (1:06:22)

    Show-related resources:

    Transcript for Out of the Crisis #20: Bitwise

    Eric Ries: This is Out of the Crisis, I'm Eric Ries. We are still reeling from the first order of consequences of the pandemic, but we are also starting to see the second and third order effects, unemployment, hunger, mass bankruptcy, and the inequity and injustice of this crisis. One of these effects that we are just beginning to understand the magnitude of is unemployment. It's becoming clear that there are two types of unemployment rippling through our economy. There's unemployment caused by the lockdown and unemployment caused by the recession caused by the lockdown. The scale of the problem is immense. So what are we going to do?

    To me, it is clear that we need widespread retraining to make sure no one gets left behind in the new world that we are building. Jake Soberal and Irma Olguin are the founders of a company called Bitwise. They have been working on this injustice for a long time. Since 2013, Bitwise has supported people learning new skills in what they call underdog cities like Fresno, Bakersfield and Merced. Bitwise was shaping up to have a great 2020. Their programs teach software programming and IT proficiency to people who have historically been excluded from those fields, and connects their graduates with tech companies around the country. When COVID hit, Jake and Irma jumped into action. They created a program called Onward California in partnership with the State of California and with the support of governor Newsom.

    The program puts displaced workers in contact with resources for essential life services, retraining opportunities and new employment. Their model in California was so successful they eventually created a new organization, Onward US, dedicated to putting American workers displaced by COVID-19 back to work. They are now operating in nine States. Their efforts in this crisis have been admirable, but as Jake and Irma made clear in our conversation, this is not enough, we need a widespread, fully funded WPA scale effort to put Americans back to work. Job retraining, up-skilling, in-sourcing manufacturing, these are necessary components, but they are not enough. What is needed is a commitment that nobody be left behind in the new normal we are collectively trying to build.

    I'm grateful to programs like these that will help get people back to work, but by themselves, they will not solve the inequities of the old system. For that set of challenges we will need to be even more ambitious and determined. We will need to take inspiration from people like Jake and Irma. Here's my conversation with the founders of Bitwise.

    Jake Soberal: Hi, my name is Jake Soberal. I am the co-founder and CEO of Bitwise Industries. We're a technology company headquartered in Fresno, California, and together with the Kapor Center in Oakland have partnered to deliver Onward US, which is an initiative to put thousands of Americans back to work.

    Irma Olguin: My name is Irma Olguin, I'm the co-founder and CEO of Bitwise Industries. A company headquartered in Fresno, California. Grew up here in the Central Valley of California, left for early work and career in college, bounced around North America for a while, returned home to start this company.

    Eric Ries: How are you doing, say a little bit about how you're handling the quarantine and what life has been like since we all started sheltering in place?

    Irma Olguin: For my personality, sheltering in place and staying home and sort of nesting and those types of things, it's actually really natural for me and I don't miss as many things as one might think. And I certainly don't feel the same as folks that are on my team, but I definitely am disturbed by the world around me at the moment. So from a very, very personal micro level, I'm doing great. I'm healthy, I've got everything I need. And I don't mind staying home, on a macro level and just looking at what is happening in the world around us, that is hard to take.

    Eric Ries: I think a lot of us are feeling that way. This is the contrast for many of us, between kind of being safe and cozy and warm at home and consuming this bad news. You read a newspaper or go on social media, the headlines are just apocalyptically dark. How have you managed your own psychology and how have you managed to kind of maintain the equanimity that's needed to lead a company during these times?

    Irma Olguin: I think the good news in this time of rare uncertainty is that the decisions are relatively black and white in terms of what's good for the health of human beings, that of course sort of clashes with what's good for the health of a company. It just so happens that my disposition will always lean toward the health of human beings, it is part of who I am. And so decision making still feels very black and white. I think where things become disturbing or unsettling is when you watch what's happening in different areas of the country with leaders who are making decisions that you wouldn't make, and I think that that becomes hard to watch over and over and over again. Or maybe they're not leaders, right? Maybe we are talking about community servants or folks we previously thought were community servants. And that disappointment, I think that is the biggest lift for me right now is to manage my own disappointment.

    Jake Soberal: So I feel like I'm in a pretty privileged spot. We've got a wonderful home just North of downtown Fresno here and are safe and have room, and the like. That being said, like it's just such a weird time. And so, I think I entered shelter in place believing that, well, I was just going to do my work from home and Sarah, my wife was sort of just going to do what she normally does. I don't think I realized how dramatically her world would be impacted. And then in turn, like things would just shift for our family. Like the absence of school, the absence of activities has, I think just turned up the volume on everything. And as a family, we've had to find new rhythms and figure out how to be sort of the best version of ourselves in this moment. And that's, I think been like, the six weeks or so have been a big adjustment on all fronts, but starting to find something of a rhythm in this really weird time.

    Eric Ries: Can you share just from your perspective where we are in this crisis?

    Jake Soberal: Oh gosh, I think we've barely left the batter's box, particularly as it relates to things like economic recovery, if we can even begin to talk about that as something that has begun. I don't think we have from my vantage point, not a medical perspective at all, but I don't think we have our arms around the health crisis, and I don't think we are talking even honestly about the depth of the economic crisis.

    Eric Ries: It seemed to be my experience talking to folks and seeing our leaders, it just seems like we are in complete denial about the severity of what has happened and the scope of the response that is going to be required to begin the recovery process.

    Jake Soberal: Yeah, I think that's right, realizing that we have a third of Americans that are out of work and the impact that that has in virtually every direction means that we've just got work to do with almost every area of society, whether that is how we think about going back to school, how we think about putting people back to work, the reality that most of us are thinking that we're going to put people back to work in the same or similar jobs when that's not going to be the case. I think that there is just quite a lot to figure out and we are getting ready to launch a podcast next week called Onward On-Air and Jim Fallows, a reporter for the Atlantic was on and one of the things he kept emphasizing is at a leadership level we need to provide empathy, hope and a plan. And I don't think we have anything resembling a plan.

    Eric Ries: So let me get this right. Empathy, hope and a plan.

    Jake Soberal: Yeah.

    Eric Ries: Yeah. Oh my God, that shouldn't be such a high standard to hit and yet here we are.

    Jake Soberal: No, no. And for me, I mean, it's putting words to something that you feel and Jim is just a super wise dude, but it felt right, and it also felt like it exposed a glaring void or vulnerability.

    Eric Ries: Talk a little bit about the situation in Fresno. How are things there?

    Irma Olguin: Fresno has always been this challenging place. We don't live on a coast, we live literally in the middle of the state, the driving industry here and since always has been agriculture. And so in the best of times, if you're responsible for feeding between 20 and 30% of the world's population, that's going to consume your thoughts and consume the economy, and you've got to put people to work to do that specific job. In a pandemic when the food supply chain, and really just like the way that people get food, even if you don't think about their consumption is not just critically important, it's life or death. And so I think that you see lots of protections and lots of effort being put into protecting that food supply chain. But I think it's also exposed places where it is weak and where there's opportunity to make life better for a great number of people.

    That's really sort of off to the side of what we do at Bitwise, which is we're focused on the technology industry or have been focused on the technology industry and providing opportunity to folks who came out of other places, usually from a story of poverty and sort of provide them that upward mobility. And so I think the question for us in this moment is like, how do you marry those two things together? How do we keep providing opportunity, but also really pay attention to where and how people are able to eat and where and how people are getting their jobs. So I think Fresno being that challenging place, oddly enough, has sort of prepared us for this moment, because it's never been easy. There has never been a day in our company's history or even I think in our personal lifetimes, when you think to yourself, man, Fresno is the place to be because this is the lap of luxury.

    Eric Ries: Why'd you choose Fresno, given the challenges of so many things, including running a company compared to some of the other more famous cities in the world?

    Irma Olguin: I think choosing Fresno as home base is--it really like gets to like a very personal question for me, at least. I was through no fault of my own, through no grand plan of my own afforded a number of opportunities to go to school and to do some really neat and interesting work as a computer engineer and then start a bunch of companies and have some success there. And that is very, very solidly not the story of folks who grow up the way that I did and like many of our citizens have. And so for me, this is home. I want to make my home better, but I think even a layer deeper is I want people who have that story to have this outcome as well, or at least for this outcome to be possible. If we can get more young people who grew up in rural California to imagine their lives just a little bit differently, I think we actually do create a better world. And so that's why Fresno, I think we can do that here and it would be hard to make the case somewhere else.

    Leaving Fresno was unexpected for me. It's not what I saw for myself that wasn't part of my life's goals, but going and seeing a completely different culture and sure it's still in the middle of the United States, which there's an argument to be made that it's not that different, but going from Fresno, California, or really more specifically Caruthers, California to Toledo, Ohio, for me for a West coast girl was culturally shocking. And it was really, really noticeable and there was this like layer of discomfort all the time, knowing that you are the only one like you in the area and being sort of faced with that again and again and again. And I think a lot of people experience some version of that, right? Where you're the only woman in a boardroom or you're the only woman in your technology program, your degree program or your training program, or, and on and on.

    I think for me, like I was so used to hearing different languages spoken and for instructions from my mom and grandmother to be half in English and half in Spanish and for dinner to regularly consist of tortillas and beans. Like to go from that, to experiencing none of that, really, almost ever, you notice it, you never really lose your awareness of that. And so you're always trying to consciously or subconsciously figure out like how to work this new system. What does it look like to look like you belong in this different culture and not signal to everybody that you don't have the same background, the same story. But it was also wonderful, while that was challenging and new and in some cases frightening, it was a wonderful experience and I got to do all kinds of things, including study alongside of some of the smartest people I've ever met and learn under some folks who've done wonderful, wonderful work in the technology industry and to experience weather that I would never otherwise experience.

    Like all of these new things, it was a rush. It was the most difficult period of my life bar none. But I think coming out the other side of that, I'm so, so grateful for that experience. I think it has shaped the way that I approach life and work today. And yeah, I'll never let that go.

    Eric Ries: You graduated with a tech degree?

    Irma Olguin: I did. I have a bachelor's in computer science and computer engineering.

    Eric Ries: So talk about what you saw as your choices at that point. You must've felt like there was a world of opportunity in front of you. How did you sort through what you wanted your next step to be?

    Irma Olguin: Planning my next steps has never actually been a strength of mine, it's a little bit more animalistic, I think, than that, whereas I know and respect people who have this grand plan for their lives. And in fact, my co-founder is one of those, right? Jake is absolutely the young man, the six year old boy who knew exactly what he was going to be doing when he was 36. That was never me. I think I'm very much like there's a bone over there that I want and I'm going to go and get it with my teeth. Right? And it's hard to see the next bone and the next bone when you don't really sort of think about it in a long term trajectory sense. And so when I went to school, it was because school had become an option suddenly, it wasn't part of a plan.

    And then when I was leaving school, there were a certain subset of jobs that were then available to me. And then, there was a tragedy in my family and I ended up wanting to come back and be around family and realized that the best version of my career and whatever was going to happen next was going to be nearby them and affecting their specific lives. And when I say family, of course, I mean my biological family, but I also mean my chosen family, my community and the folks that I grew up with. Maybe not by name, but archetypally, that was the family that I wanted to affect. And so those choices, it feels like life has almost made those choices for me. And I feel as though every time a new opportunity is presented, it just makes crystal clear sense in the moment and it feels obvious and right that I do that thing next.

    Eric Ries: When you made the choice to live elsewhere, did you feel like you had to give something up career wise?

    Irma Olguin: Well, when I originally left California, you're giving up all of that community and support for sure. And for someone who grew up around a lot of people that are kind of--you miss your pack. You're a litter of puppies and then suddenly you're not with your litter any longer, so that was hard. And then leaving, going and experiencing the wider world, getting an education, doing computer engineering work in a bunch of different places, there's momentum that's built there, you're gathering connections and your network and experience and job opportunities and et cetera. So sure, to return home was in every way, starting over again from a professional lens. I had no network on the West coast. I had no job prospects on the West coast, I was going back to my litter, but I was not bringing any of that professional help with me. And so yeah, I think I gave away probably what could have been a lifetime of climbing the corporate ladder and traded that instead for entrepreneurship.

    Eric Ries: It's such an interesting example of how privilege operates in our society, where some folks have the opportunities and family and all those conveniences. It's kind of all wrapped up into one and it creates this kind of glide path for them into conventional kinds of career success. And others are forced to make really difficult trade-offs like that. But what I think is so interesting about it is I've gotten to meet many people who have been on that glide path, who climbed the corporate ladder. And of course that many of us who are more of the misfits who have wound up in entrepreneurship, and there's actually a kind of a rich reward that comes with being off the beaten track and away from those centers of power. So you made the choice to go into entrepreneurship, to abandon those kind of professional supports. What was it like?

    Irma Olguin: It felt natural. It was as though I figured out what I should be doing with the experience I was so recently afforded because I think that designing my own life, but also getting to figure out ... getting to determine how I was going to participate in the world, felt natural. Whereas, taking the job at X company, advancing to Y position, attaining Z salary, didn't feel natural. It felt as though I had become part of a machine and couldn't really find myself in it. So entrepreneurship while extraordinarily difficult from the perspective of like what it takes and what it asks of you is its hard to see a different version of my life anymore, because it's so much a part of like who I am to be able to say, we're going to go after this kind of business or this kind of deal, because it has a profound impact on lives. And getting to say that, and not having to sort of triple check that with everybody around you is worth it. It's worth how difficult it can sometimes be.

    And I think too, the transition into entrepreneurship also lends itself to a mindset of like, you've just got to put down things that don't work a lot faster than in any other version of your professional life. And so that, again, that too feels natural. This thing is not working, we're not going to do it anymore. Let's try another thing, that changes the way that you look at success and failure and goals and shapes it into something I think is more attainable for the vast majority of us. So even though, again, this path is difficult from a personal emotional level, from the flexibility it affords a person to try things. And if you can really sort of sit in that mindset, and I think Eric, you know this. You wrote the book on this, literally. If you can do that, if you can put yourself there, you can bring other people with you into that mindset. And I think that there's a great power in that.

    Eric Ries: Yeah, it's an incredible feeling when that team kind of comes together in defense of a common vision. What were you doing before the pandemic? How you came to run a major technology company in Fresno. That's not exactly people's first association they have with Fresno.

    Jake Soberal: Yeah. So I actually grew up here in Fresno. And actually in a suburb just to the north and east of town. Like a lot of kids who grew up here, you begin to think the best and most exciting version of your future exists somewhere else. And that is what guided me, like many others, to pursue school and early career elsewhere. Bouncing around the country, went to school at the University of North Carolina, Chapel Hill. Did law school in Southern California and had no intention of coming back. I did though cherry pick an externship opportunity during law school for the court of appeal here in Fresno, which was a good gig, but candidly I thought the kids from Stanford and Berkeley won't apply.

    So it would be easier to get the good externship in Fresno than it would be in LA. And so I did, and I landed the gig and came back and started digging in. And I shared a number of times that the work was fine. What was the most impactful piece of that summer was the realization that I was deeply drawn to this place. And I felt as though the most impactful best version of my story of myself was here. It was the place where I can do the most good. I didn't know what that would look like. Then came back as a sort of a young intellectual property attorney, working for a wonderful firm here in town. Dug in and not so long after that began representing this upstart five foot nothing Latina founder from Caruthers, which is a rural town to the south and west of Fresno. That of course is Irma Olguin, who is the co-founder of Bitwise.

    We very quickly realized that we had a shared vision for something better and different in Fresno. And I think in each other, found not only that high ambition, but somebody that we believed could pull it off. And began dreaming around what that might look like.

    Eric Ries: What was the first thing you tried? What was your first entrepreneurial steps?

    Irma Olguin: Well, it's not glamorous, but the first I tried as an entrepreneur, it was out of necessity. When I first returned to California, I was, again, without job prospects, without a network. And I lived in rural California. I was not in a city center, and so things like internet and reliable vehicles, all of those things were hard to come by at first. And so my first entrepreneurial experience, returning to California, was cleaning out pantries and garages of other people, and then selling the wares; the crock pots, the guitars, the leather jackets that you find in those places. Selling those things at the flea market on the weekend. And trying to figure out sort of one nickel at a time, one quarter at a time, what your profit margin is going to be for the week. And whether or not you can turn that into lunch, or can you turn that into a tank of gas? And can you turn that tank of gas into an interview?

    It was a journey, but that was my first entrepreneurial experience. Was selling sort of thrift store level things at a flea market.

    Eric Ries: How did that lead ultimately to starting Bitwise?

    Irma Olguin: Gosh, I mean, when you're scrounging and scraping for your tank of gas. The victory that you feel when you realize that you're in a position to not scrape and scrounge for those things any longer, I don't think... I'll never forget what it feels like to not count the change. And to be able to give that feeling to other people or help them find that feeling. That's what Bitwise is about. Sure, we use technology as the tool to make that possible, but ultimately it's about agency. And I can't see myself living my life in a way where my time is not directed in making that possible for other people.

    The path to Bitwise was not a straight line, for sure. It went from selling things at a flea market, to picking up some side jobs, building websites, to sort of accidentally accepting a challenge to start a nonprofit in the coding competition.

    Eric Ries: Well, how did you do that accidentally?

    Irma Olguin: I was earning these contracts, these web development contracts, and then being relatively desperate and new, building out my network. If somebody asks me to connect a printer, I would take that job too. And ended up building this client base and a reputation for doing almost anything that touched electricity. Right? I would pull cables, I would connect networks, I would build websites, I would form teams. It was just all over the map. And I remember what ended up happening was that I was doing that for this... It was an incubator. It was a very small incubator in Fresno. All of those different jobs, connecting printers and what have you. And the CEO of that place, at the time, comes to me one day and he says, "Irma, why are you the only person that I've ever met in Fresno who knows how to do these things?"

    And I remember looking back at him and saying, "Because you don't hang out in the right places. The folks who do these things, they're wearing hoodies and flip flops and they have their heads down in Starbucks for four and five hours at a time, and they're writing code for eBay. You don't know them because that's not your crew." That statement was met with disbelief, and basically he said, "Prove it." And so I did. I set out to prove it. Started a software competition to draw folks out of the wood works, that I knew were doing this work silently, quietly, their own sort of single-person technology industry in the heart of California. And wanted to bring them together in a very public way. And so offered cash prizes and got a bunch of sponsors. And through this competition, it was a raging success.

    And in a single day, something like a 100 or 150 new technologists were exposed to the world that didn't know they were there. And that was cool, that was a cool feeling. And ran that competition for, want to say five years. And it was actually at that competition and the nonprofit that ensued, that was my first touch point with Jake, who is my co-founder. It was a recent transplant back into Fresno. As the story goes, he was looking around for "Who's doing the technology stuff in Fresno?" He kept hearing my name and he reached out one day and said, "I want to sit on your board. I want to sit on the board of this nonprofit." And yeah, can't say that it was smooth sailing from there, but that was the very first interaction where I thought this is an impressive man.

    I disagree with his choice of career. I think being an attorney is maybe not the lifelong sort of goal for this guy, but I'm interested to see where this relationship goes. That led to a fast friendship, honestly. We got into great and wonderful fights together. It was a ride, and here was this person who is at least as smart as I am, if not more, who just wants to disagree with everything that I said, but would actually listen when it turned out that I might be right. And I thought that that was refreshing and different and challenging for me to have to deal with somebody who could be wrong. He ended up becoming my representation for a different company that I started. He was our IP attorney. And again, we were friends through that process. We ended up sharing our frustrations around what was not happening in our city. This really, really challenged place. Like why couldn't we be something else or become something else. In pursuit of that answer, we started Bitwise.

    Jake Soberal: I have so many things to correct.

    Eric Ries: Yeah, Jake.

    Irma Olguin: Oh, I dare you.

    Eric Ries: I was going to ask who wins most of the arguments?

    Jake Soberal: Irma. That's not a good question.

    Irma Olguin: I thought I was going to get through that whole thing unscathed. I couldn't even hear you breathing.

    Jake Soberal: Yeah, where do I begin in correcting the record here? First of all, Irma is a genius. I talk nice. And so the intelligence question is not in play, but I think the most important thing substantively that I think was sort of glossed over there is we tend to... Even as entrepreneurs, fundamentally we're disrupting something, we're trying to do something in a way that it hasn't been done before. We tend to get locked into, "Well, this is the way things work." And what I think you heard in that, like "I accidentally created a software development competition," is actually not quite right. I think that one of Irma's real gifts is that... What was being said there by the CEO she was speaking to, is that, "We can't do technology in Fresno because we don't have the talent." And Irma's response was, "No, no, no. The problem is you don't know how to find the talent. One, and you haven't done anything to create the talent. Two. And we can change that, we can build a system. We can build pipes for that."

    And I think that becomes so profound, in that, Bitwise here is this big company now that is somewhat flashy and making meaningful amounts of money and having big investors and all of these sorts of things. But if you rewind the tape to the day that I was seeking out Irma, what Irma was doing is she had a software company where she said, "Well, I'm going to grow. And so I'm going to also sort of teach a cohort of people around me how to do the things I do." And so she had an Academy. "I need community in order to support those people and the idea that tech could thrive in Fresno." So she started a co-working space. "And then I, of course, need revenue for this." And so, as she described, "Fixed everything that touched electricity."

    Irma had built the ecosystem that is Bitwise in it's sort of beta version just because it was natural to her to fix the whole problem, and not just a piece of it, that made things better for her. And I think that's a really, really big deal. And so much of what we do today at Bitwise was really where... And in my role, I was a very useful microphone to the work that Irma very naturally came to, and happily so. So really what you've just heard is the origin story of the work that today is Bitwise.

    Eric Ries: That is actually a common trait among the very best entrepreneurs. You know, there's certainly people out there who are very self-aggrandizing and think everything they do is brilliant, but a lot of the really great entrepreneurs that I've had the chance to meet, they don't see their work as a big deal because they can't imagine doing anything else. So they can't imagine the world in any other way. And it's actually a common finding in the entrepreneurship literature, that people think of entrepreneurs as risk seeking. But actually, if you genuinely believe in your vision, it doesn't seem risky to you at all. It's the people around you who see it as risky. And so the attribute that is needed is the ability to help them cope with the stress and the anxiety of what they perceive as risk, but in your heart, if you see that Fresno can be a different way, the fact that that vision has not been realized for, I don't know how many decades you want to count it as, but for a very long time, it doesn't really matter.

    And so I really appreciate both of you kind of sharing that prehistory of how this came to be, because I think it's important for people to understand how change actually happens in the world.

    Irma Olguin: That's a really strong point, Eric. I got to say the idea that you really can't see it a different way, and it feels... Not to sound condescending, but in many ways it feels like this is an obvious next step. And we must do this if we're going to change X. I feel convicted by that every single day. Every single day, I feel like we must put this foot in front of the other in this direction, or we are not going to have the effect that we said we could have.

    Eric Ries: What did you want to change with Bitwise?

    Irma Olguin: I wanted folks to feel that same sense of empowerment that I currently feel in my life. And in my life story, I come from a family of field laborers. What I saw for myself was more field labor, right? Or the highest and best getting that job at the Texaco or the ACE Hardware and climbing the ladder to be management, right? Like that is what I saw for myself. And it didn't turn out that way. And when you look in the rear view mirror, the fact that it didn't turn out that way had nothing to do with this master plan that I had laid out for myself.

    And it was really these moments of serendipity that continued to pop up. Certainly, I had to take advantage of those moments of serendipity, but it wasn't... Again, I did not puppet master myself to this place. Instead, I feel like life sort of shoved me at these opportunities. And that feels like a fixable thing. We don't have to wait for serendipity. We can be deliberate about these things. We can get folks to see their lives differently. We can get the training into their hands and provide the reliable vehicle, so that they can arrive at that training. We can help them get that first job. Like all of the things that led me to that moment, where I realized I was no longer counting the change, we can do that on purpose. So that's what we set out to do, and every day we have to ask ourselves, "Are we still doing that? Or are we just getting big?"

    Eric Ries: Tell us a little bit about where Bitwise is today. What's the growth trajectory been like?

    Irma Olguin: I believe the world thinks that we are growing quickly, Jake and I feel as though... If Bitwise lives in dog years, can we do that twice as fast? We are impatient, and in some cases, petulant and would like to do a lot more of the things that we are working on. We'd like to try a lot more things that factually won't work. When we set out to grow this thing, we wanted to build something that Fresno itself was going to be proud of. And then when we realized the impact that all of these moving pieces were having in Fresno, we had to ask ourselves from a moral obligation, "Is it on us to take this to other places that faced similar challenges and see if it works there as well?"

    And so we set out to do that. I think that our lives and the trajectory has been interrupted by this pandemic, but largely we're making that same effort. "Can we change things for the folks among us who are the least advantaged, and help get them into positions where they have that agency in their lives? Onward was born out of that. onwardus.org is the platform we built to help shorten the time of displacement for folks who were being laid off in really great numbers in one industry. While we're watching these announcements on the news that other industries are surge hiring, can we matchmake? Can we put those things together? We wanted to accomplish that but then if you think about how that actually has to happen? A person needs dollars in their hands. Right?

    They need food on the table. They've got to take care of these immediate needs even before they think about a replacement job, at whatever hourly rate or salary they were at before. That became Onward. Life essential services, job matching training resources. What we're doing with Onward, is the same thing that we were doing with the Bitwise ecosystem. It's just taken this format during a pandemic. When the world stops being on fire, do we want to go back to sort of the more, maybe not traditional to everyone but traditional to us, format of we ran in-person classes and we build wonderful buildings and we put those people into jobs, and we have this sort of ecosystem effect where the technology industry is activated in places where you don't expect to find it in the United States. Yeah, we would love to do that, but let's also answer this moment. Let's answer the requirements of this moment in helping people survive.

    And let's do that in a way that feels genuine to us. So while our growth trajectory in the way that we announced to the world we would grow, is probably delayed a couple of months. We haven't stopped growing and executing on our mission during this time, and it's probably important now more than ever that we do that. So I think shooting the moon, we get to do this. The world stops being on fire, we go back to growing and we're across the United States changing lives and helping people get to that moment where they're not counting the change either.

    Jake Soberal: I think there's something so important and strange about where Bitwise is at in its growth trajectory. Our fundamental thesis is that people of color, women, communities of concentrated poverty, have immense talent to contribute to the technology industry, which... Oh, by the way, sort of is the industry of our age. We're creating more opportunity and wealth than any other industry on the planet. In addition, those humans, collectively, are the majority of America and they reside disproportionately in non-primary markets. That thesis to us, doesn't feel controversial. It feels really, really obvious. The strange thing is that Bitwise is in three cities today. And in those three cities, we are the largest actor in the United States that is doing this work that is advancing this thesis. And so the world is beginning to say, "Man, you really did it." And Irma and I are looking at each other, and saying, "That's not even a rational statement." There is so much more work to be done. It's so profoundly obvious that we are neglecting the majority of talent that could be leveraged to grow prosperity on the planet, it just feels like this gigantic disconnect.

    And so while we might be making venture capitalists quite happy in terms of our growth and return profile, et cetera, it doesn't feel as though the world really understands the work from an impact standpoint, or from a size of opportunity standpoint.

    Eric Ries: So I'd like to get some more specifics from you, because I feel like we've been talking about this very conceptually but we're losing the human beings behind the story. So could you tell us about what actually happened behind the scenes that led to Onward California?

    Jake Soberal: So we were, I think, just a couple of days into being fully remote as a team, and our thought process had been that step one was to get our team home and safe, and step two, and there were literally hours in between, was to think about what is our role in meeting this moment, particularly set against the context of Fresno. We're a venture-backed technology company with a bunch of cash, a bunch of really smart people. We've got a degree of privilege and influence, and we felt obligated to put that to work in a moment where there were needs emerging around us.

    And so we tackled a couple of different things. We started a grocery program that ultimately grew to be one of the largest in the state. And then we began to think also about the fact that fundamentally in a non-pandemic setting, Bitwise is about helping folks without opportunity get opportunity. And what we were watching, here in Fresno, were our friends and neighbors by the hundreds lose their jobs, watching individuals literally in the buildings beside us at Bitwise, where we've got four downtown buildings, be laid off in the dozens.

    And it felt as though the world was talking about unemployment as something that was coming, and it felt very present for us. And so we had not long after that a session set aside with Mitch and Freada Kapor of the Kapor Center, who are also investors in Bitwise, Mitch serves on our board. And I think it was a day or two later, we had been wrestling with these things, and then that conversation surfaced them and their hearts were in a very, very similar place.

    And so in that conversation, I think we spent two or three hours together over Zoom, we began to not just say, "Okay, well, this is a big problem. We should do something about it." But to really like get tactical and well, "What could we do about it, and how would that work?"

    And before you know it, we're sitting there with the founder of Lotus 1-2-3, architecting a system for putting America back to work. And it was pretty amazing. And then in their trademark fashion, without more, said, "We'll put up the seed donation to accomplish this, and let's call this person and this person and this person to see if they want to participate."

    And all of a sudden Eric Schmidt is at the table, and MasterCard is at the table, and the folks at McClatchy, and on and on, and now we've got this coalition built. We are connected with the governor of California, who's saying, "Let's deploy this at the state level." It felt like it really gained immediate and fast momentum, but was born out of something that weighed heavily for us, and it weighed heavily for Mitch and Freada, and fortunate to be sitting in a spot in the world where there were enough resources in the room to begin to do something about it.

    I think that what shouldn't be lost in there is that Bitwise's model fundamentally is about how do we raise up folks from a story of poverty, folks from communities of color, women, to be software engineers. And we do that via apprenticeship. So when we're talking about building all of these things, we're not talking about your conventional team that was ultimately responsible for building and deploying Onward. We're talking about folks who had come up in that apprenticeship model, women and people of color in Fresno, and in Oakland, and in Bakersfield. That because of the model that unearthed them, we're in a position to build a software platform in 11 days that will ultimately put tens of thousands of people back to work.

    And that's a pretty profound circle of life, if you will, that was realized in such a short loop.

    Eric Ries: Talk a little bit about what the platform does.

    Jake Soberal: Yeah. OnwardUS is a web-based platform. At its core, it's built on Salesforce and WordPress. And what a user experience is for somebody coming to the website is hopefully it's communicating to you that this is a resource to help you find the things that you need on your way back to work, in addition to getting back to work. So the site takes in a little bit of information about the user, their identity, their preferred industry, their desired earnings, their education, et cetera. All of that is voluntary. But then what it uses that information to do, is dynamically then return the resources that are most relevant to you, the user. You, the job seeker, across three categories. Life essential services, so food, shelter, money, childcare, training, and jobs. And the idea is that one of the things that we do as a society, and it's well-meaning in a moment of crisis, is that we throw information, and lots of it, at the individual who's experiencing trauma.

    And what Onward is endeavoring to do is both aggregate that information, but also organize it for the individual who's living through traumatic unemployment. And so that ability to match the resource to the human, based on the human's unique attributes, is really the fundamental functionality of Onward. And the hope is that Onward is... It's not an endpoint to anything. Onward is not the one hiring the individual, Onward's not the one training the individual. Onward is not the one providing groceries to the individual, but we want Onward to be a beginning point to everything that is necessary for the wide variety of stories and journeys back to work that are going on across our state and country today.

    Eric Ries: Tell us a little bit about what surprised you in building this so far.

    Jake Soberal: I think one of the things that was most surprising with Onward is the number of actors in this space, broadly workforce and systems of unemployment, and the like, and one, how much, really, really good work has been done in thinking about how we serve unemployed people, but two, how disconnected it is from one another.

    And so you have this agency in this state, or this secretary of labor in this state, or this foundation in this other state that is thinking deeply about training, and how we match a person to training, or jobs and how we surface them to a job seeker, and on and on. But so terribly disconnected. And that was I think, somewhat alarming, because we're spending these same resources over and over, essentially 50 times across the country, to solve the same problem.

    And I think that then the thing among that that stands out the most is just how complicated, and just how early days we are in in how match we human beings and people to training, to the training that is going to help them get to the thing that they want. Our system for doing that is really, really bad.

    If somebody wants to get into say a construction job, how do we tell them what to do? Is there a pathway to go and try and get a job with a construction company, because there are construction companies that will hire them? Is it a better pathway to get an apprenticeship with a union, because that's a pathway into a really good paying job? Is there a pathway to go and get a degree in construction management from Fresno State University, because that's a good degree? Is there a pathway instead to go and get a two-year degree that's going to communicate that they have a base level of soft skills that are going to ready them for a wide variety of jobs potentially within the construction industry? All of those are viable paths. We have virtually no ability to help an individual make that decision. We simply leave them to it.

    Irma Olguin: I'm laughing to myself over here because you are so much more muted about your opinion than... We're trash at this, like as a whole, we are bad at this. There doesn't appear to be one working system that is helpful in the way that you could talk about this makes sense to do this at scale.

    Jake Soberal: It's absolutely true. So we drop folks off at the end of high school, if we are able to get them that far, and then we hope to meet them on the other side. That's literally our plan. And that I've given the example of a construction industry, now let's imagine any other industry. Software development. There are as many, if not more pathways. A career as a medical technician, same story.

    Now throw a pandemic on top of that, and I have begun down my pathway and landed a job in the restaurant or food service industry. And now I'm not fresh out of high school, I'm not still living at home. I do not have a safety net. I've got to not only build a track, I don't have the option of going further in the industry I pick, I've got to build a track out of that industry and into a new one. The standard, we'll go to community college and then get your four-year degree, and then maybe get a master's degree, and then do this other thing, is gone. Your life has already spent those days. And so the problem of not being able to chart humans to training is exposed in a really profound and tragic way by the state of things today.

    Irma Olguin: I think if you imagine a, and this is not any particular person, but I'm just building an avatar on my feet here, a 49 year old woman who has been a waitress at a diner for the last 28 years of her life, and maybe has raised a kid or two and they've recently flown the nest. In the pandemic, in this pandemic, she's lost her job. She's not looking for a re-skilling opportunity, she wants another waitress job. She's looking to recuperate lost income one-to-one, or as close to one-to-one as possible.

    And we hear that story, the world at large I think hears that story. And we think, "Ah, let's get her into training so that she can become something else." I think we really need to take a long look at how we are thrusting that viewpoint onto other people, that that's not always what they're looking for, nor is it their life's goal.

    I think the diner waitress at 48 is thinking, "Can I get something to do at roughly the same hourly rate and tip structure for the next four or five, six years of my life, and retire?" And I think that that for me, is a surprising piece in this process of building Onward, and deploying it to all of these different places, is how much we want to inflict that viewpoint onto other people, that they should up-skill or re-skill, or retrain into a better paying job. I would like for us to stop doing that, and instead make it possible for folks to meet their goals where they're at, in the way in which they want to meet them. That feels profoundly important to me.

    Eric Ries: What do you hope for Onward going forward? How do you see it growing?

    Jake Soberal: I think that we see two threads for Onward. The first of them is that we want the tool to continue to reach more people in more places, because we think it has great value in helping them get back to work. And so that is continuing to lean in to the present rollout. But I think that as important, particularly with our entrepreneurial lens on, it's revealing all of these gaps in things that are problems we're really interested in tackling. So for example, this surfaced a conversation with a good friend of ours, Michael Tubbs in Stockton, the Mayor of Stockton, who rolled out a couple of years ago a pilot program in universal basic income. And that's deeply related obviously to the idea of being a displaced worker.

    And so we've been collaborating and in conversation around might we be able to accomplish a software platform that made the work that he's done with UBI in Stockton, and which is fundamentally getting dollars to financially poor people. And that's the challenge. Can we make that plug and play, such that if another mayor or county decides to adopt that, we can have a system ready to help them do so. And that's just one example of about a dozen, where the work of Onward has revealed gaps and problems that we're interested in solving.

    And there's a broad coalition attached to it, where we're now thinking one-to-one conversations with a wide variety of them of, well, how can we do that? And that's really, really exciting, but it exposes a great depth of need.

    Eric Ries: Has building this, I don't even know what to call it, it's a platform, it's like a part tech platform, part social service agency, quasi-public private model for what a 21st century response to a crisis might look like. Has building it made you more optimistic, or less optimistic about our situation?

    Jake Soberal: It has made me less optimistic about the system that is in place. What I think present circumstances are revealing is not just a hard moment, but a broken system. The systems we have set up for putting people back to work, for serving them while they're out of work, for making sure that people get a proper wage in the job that they're in, for any number of different things, are broken. They're not working well. What leaves me though optimistic, are the human beings at work on the problem. And so what I mean by that is you have Joe Barilla, the secretary of labor in Colorado, who is coming at this work in a holistic way, and engaging community partners to think about, openly, about how they make their system better. You have Schmidt Futures that is just pouring out money to solve problems all around them.

    And you have the Kapor Center which is stepping up to the plate in about 100 different directions to do something that matters in a difficult moment. And so the human beings that we're interacting with. Governor Newsom in California, they're the right people, we have the right stuff to solve this problem. So we're optimistic that this is a moment where we can begin thinking differently about how we rebuild these systems, and not just rebuild the same systems that advance the same inequities.

    Eric Ries: Just move them into the cloud, and make them 20% more efficient at producing gravely unequal opportunities and outcomes.

    Jake Soberal: That's exactly right. I'm optimistic that we can make different decisions in this moment that is measured by, I think, a reality that there's a window in time in which we get to make a decision about whether we're going to rebuild the inequities, or build something new and better.

    Eric Ries: So what does success look like? What do you hope will happen if we build a new set of more just and sustainable institutions as part of the new normal, on the other side of this?

    Jake Soberal: Oh gosh, I've got a list.

    Eric Ries: Let's hear it.

    Jake Soberal: I think that cities around the country begin adopting universal basic income.

    Eric Ries: Talk about why that's important to you.

    Jake Soberal: It is because of something that is an often refrain for us. And that is that there is something magical inside of every human being wandering around, we only get to experience that magic if that person feels as though they're secure enough to have food today, water today, a place to sleep today, and those require dollars.

    And so if we can get everybody enough dollars for that base set of things, we get to experience their magic. If we do not, then we do not experience their magic. And we choose over and over again to not give the majority of human beings that opportunity.

    I think that we need to lean in heavily in this moment to apprenticeship models, as a way back to work. Where we are doing something... Irma just put forward the commission around jobs recovery that was convened by Governor Newsom. It said, "We have been lamenting for decades, the need to rebuild the state's digital apparatus. This is the moment to do it, and it should be accomplished by thousands of apprentice software engineers that we're readying for industry when they finish that work." And in the process of doing that, could create tens of thousands of jobs. And you could take that same model and apply it to any number of different industries. I think that we have not thought deeply enough about what a proper minimum wage looks like. And as we put people back to work, why not pay everybody $20 an hour instead of what felt like a radical conversation around 15? And any number of different things in that category that think deeply, not just about how we get people back to work, but about how the work that we put them back into is something that could sustain the quality of life that any one of us would be satisfied in.

    Eric Ries: Irma, what are your hopes and dreams for the new normal?

    Irma Olguin: I'd like to take down some of the expectations. So we have been so ingrained in our culture. This is very pie in the sky, and it's hard to imagine....

    Eric Ries: Well, so is building a major technology company in Fresno not that long?

    Irma Olguin: I'm not without hope, but undoing some of those things that have become part of the fabric and fiber of these barriers to entry that we have stood up in a person's life journey, in some cases, that's college, in some cases, that's the ability to afford a home. There are lots of places... The ability to bank, honestly, let's go all the way to whether or not a person has access to a bank so that they can do normal things like have a legit cell phone, right? Or apply for a credit card, these things that we have stood up over time as barriers to entry in the way of life that I currently enjoy, now, to me, it feels like the moment to tear them all down. Why wouldn't we? They've been broken. The world broke them for us.

    So I think that this is an opportunity to enact a bunch of different things. UBI, or universal basic income, is a really wonderful example of a thing that solves, could potentially solve a lot of those issues at once, if you sort of spider out from it. Where do folks bank if they are... if UBI exists? And what are the requirements for that? That's just one simple example. Look at the school system, right? Nothing about our school system works right now. It was built 100 years ago in a world where, literally, the time in the seat was the most important thing. And now, we're in a position where time and seat does not make sense. Can we rebuild that so that there's a different, important thing that we are watching or set of things that we are watching?

    And if in fact, 50% or more of your schooling is going to take place online, then does it matter which district do you live in, or can this become a system for choosing where you go to school differently, such that you can enjoy the same benefits as the person on maybe the affluent side of talent or in the school district that has a reputation for doing a great job? Now is the time to rebuild those things and to rethink those things. But I think what we are facing is a world that's waiting to go back to normal. We long for that normalcy. Great chunks of that normalcy were trash.

    Eric Ries: How do we make sure that we don't waste this opportunity? One of the recurring themes in conversations that I've been having has been the consequences of past crises, not just past epidemics, but past crises in education or in finance, and the times in history when we have reacted to crisis as an opportunity, and really used the facts of the crisis, the fact that there is tremendous labor and raw materials that are suddenly available, where the economy is no longer putting the pressure on every company, every organization to deliver everyone's 2020 plans. Everyone's 2021 plans are totally blown to hell. So sometimes, we retrench and retreat in the face of fear and despair when those things happen. And occasionally, it becomes an opportunity to lay the foundation of a more equitable, more sustainable future. So what's your view on how we make sure we don't waste this opportunity this time?

    Irma Olguin: I think if we're not going to waste this opportunity, we have to get a lot more creative about what acceptable looks like, looking at things like training programs and what were the gates before to creating a training program that was recognized, being able to tear some of that down and say there are a lot of opportunities right now. It doesn't look like what the world used to look like. That mindset of the thing... the world that this thing was built in doesn't exist anymore is a complete mind shift. So I think in order to not waste this moment, we have to do a lot more letting go, a lot more saying this doesn't work anymore. It didn't work before. Let's not return to a thing that didn't work. Let's get really, really creative about what we think works now.

    And really, I think adopting a lot of what you've been saying for years and years and years, which is we got to try some stuff, we got to do it quickly. We don't need to build out the whole thing to know whether it works. We just got to get to that, that MVP, that version that tells us enough data before we can make a new decision, I think we have to do a lot more of that. And I think that, thanks to your work and the work of others in the technology startup space in particular, that mindset is easy to come by. But I think when we were talking about systems that have been in place for 60, 70, 80, 100 years, those things, it's going to be really, really hard. So I think if we can adopt more of the mindset that we have to try and fail and try and fail until we get to a new MVP, it's going to be really hard to change anything. So, that's how I think we make the most of this moment is encouraging the folks who have power, decision making power, to try new stuff.

    Eric Ries: Where do you think we go from here? How do we get out of the crisis?

    Irma Olguin: I think the most sort of level headed version of this crisis is to accept that its ramifications will be with us for a long time in that folks who were recently laid off, it will take them a while to get back into jobs. We need to accept that school will not look or feel like what we expect school to look like. We have to accept that things like life events, right? Weddings, funerals, those types of things, it's going to look and feel different than before. But I think if we're ever going to get to a place where we recognize something that's normal, we have to give scientists time to do work. I mean, we've never experienced anything like this in our lifetimes, at least, where we're relying on one profession to sort of save the day.

    But I think that this is it. We've got to give them time to come up with the therapies, to figure out whether or not a mask works, to come up with a vaccine that is not harmful. And that profession, we have to buy them time, and that means changing what we do for longer periods of time than we are comfortable giving them. On the other hand, on the other side of the coin, I think that they are working at light speed. We are seeing unprecedented announcements and the time to trial and all of these things that are really, really impressive. Meanwhile, we are at home, making our 17th batch of Rice Krispies treats and wanting to go back to normal where we can see our friends and have coffee together. We've got to buy them time. I think that, that's ultimately how we get out of this thing is if we can all be responsible citizens and give our fellow human beings who are doing the super hard work time to save us.

    Eric Ries: Irma and Jake, I want to thank both of you for coming on and taking time out of what I know is such a busy time. And just, thank you for the work that you do. If we're going to get out of this mess, if we're going to have a better future, it's going to be thanks to entrepreneurs who build those new 21st century institutions. So, thank you.

    Irma Olguin: Appreciate you, Eric. Longtime admirer of your work. Everybody in my industry of course knows who you are, and so it's an honor to have this discussion with you and to be able to just share thoughts.

    Eric Ries: Thanks. That's very kind of you to say.

    Jake Soberal: Thank you so much for having us. Really enjoyed the conversation here, and appreciate the work that you're doing with this podcast.

    Eric Ries: This has been Out of the Crisis, I'm Eric Ries. Out of the Crisis is produced by Ben Ehrlich, edited by Zach McNeese and Sean Maguire, music composed and performed by Cody Martin, posting by Breaker. For more information on ways to get involved, visit helpwithcovid.com. If you or someone you know is leading an effort to make a difference, please tell me about it. I'm at E-R-I-C-R-I-E-S on Twitter. Thanks for listening. Please rate and subscribe wherever you like to listen.

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