Jack Shaw (YC 71), Co-founder of the American Blockchain Council
Mr. Shaw is a strategist, author, and award-winning professional speaker. He is globally recognized for helping executives understand emerging technologies and their strategic implications. Voted one of the top five Technology Futurists in the world, Mr. Shaw has advised more than 30,000 of the world’s top leaders, professionals, and C-level executives from the likes of Mercedes-Benz, Bosch, Coca-Cola, IBM, Oracle, and SAP on ways organizations must adjust and adapt to the ways new-age technologies, including AI, Blockchain, 5G, IoT, and 3D Printing, impact everyday processes.
Mr. Shaw has delivered more than 1,000 keynote discussions and executive forums in 26 countries and every state within the U.S. He is respected as the world’s leading professional speaker on the constant developments in Blockchain and how it impacts businesses, conducting over 60 engagements in 12 countries on this topic. Mr. Shaw graduated from Yale with a degree in Business Administration and has an MBA from Kellogg in Finance and Marketing.
The Politic: Tell me about your background!
Jack Shaw: I’ve always been interested in technology and computers. When I was an undergrad in the late ‘60s/early ‘70s, Yale didn’t have a Computer Science department. They also didn’t have the School of Management. My B.S. from Yale was in Administrative Sciences, or “Business Administration” as its known elsewhere, although that’s no longer offered as an undergraduate degree. Ironically, I signed up for computer courses three times, and quickly dropped them all three times. I was interested in finding out how to use computers and what you could do with them. These courses were in the Engineering Department, and they were deeply technical. They had to do with designing operating systems, which was too far down in the weeds for my interests.
It wasn’t until a bit later that I got involved with computers, more directly at least. I was studying at Northwestern’s Kellogg School of Management, and I took a programming class which I really enjoyed. By coincidence, I took a summer job with Swift Meats. We were trying to set up a very sophisticated cash-management system. Nobody had done that before because interest rates had been so low. People just didn’t pay attention. But suddenly– interest rates had soared.
One of the keys was to use an early form of electronic funds transfer (EFT). It was very cutting-edge technology although very primitive by today’s standards. Since we were able to use EFT, so we were able to design the system in a radically different way that would have been otherwise impossible. Because of that capability, we ended up saving the company hundreds of millions of dollars. They were in the food business very limited margins. So our system doubled the company’s profits, and the stock prices went through the roof.
At this point, I was about 3-4 years out of Yale. I was in my early 20s, and that made a huge impression on me: By leveraging emerging technology, not only for its own sake but to redesign or rethink very important processes in ways that would otherwise be impossible, you can have a strategic impact. That really got my attention. A few years later, in the late ‘70s, I got into the software business at a time when most people thought ‘software’ referred to lady’s sweaters. In 1969, there was a Supreme Court decree that computer companies had to start allowing third parties to create computer software. That was the genesis of the software industry itself, and it was still very primitive back in the late ‘70s. That’s how I got involved, and I moved to Atlanta.
Because I had been working with EFT, I was particularly intrigued by the idea of incorporating EFT and EDI (electronic data interchange) to allow the computer systems of one company to communicate with the systems of a trading partner, so that a customer, for instance, could send a purchase order to a supplier. This was all leading edge in the ‘80s. I got involved in developing national and international standards of EDI, and then I finally went out on my own, writing and speaking on emerging tech.
By the early ‘90s, I’d been hearing about the Internet for a few years. When I finally saw my first demonstration of a graphical web browser in 1994, I realized this was big time– this was really going to hit the ceiling now! I actually had my first website up a few months after that. The point is that I was excited about cutting-edge technologies, and I continued to write, consult, and speak on emerging technologies all throughout the ‘90s.
In the early ‘80s, when we were first looking at using EDI to exchange information between one company’s purchasing system and their supplier’s order management system, accounts-payable system, and so on… We said, “We ought to be able to program those systems so they can process that info automatically, without human intervention required.”
What we realized was that, if everything was within defined parameters, you could in fact do that; but, if there were exceptions, you would need for people to take a look. Then I thought, “Well, wouldn’t it be possible to begin having the computer replicate the way that people look at and manage exceptions?” That’s when I started to dive into AI. Even though it had been talked about for 30 years already at that time, it was far from being ready to use– but I was keeping an eye on it.
How did your work with EFT/EDI lead to an interest in blockchain?
In the late ‘80s to early ‘90s, I was also keeping an eye on whether we could communicate electronically and exchange money electronically. We could do EFT, but that boiled down to the idea that one bank could send credit information to another bank, and the end result of the accounting process was the transfer of value from one account at one bank to another account at another bank. That accomplished the objective, and if there were enough money involved, it might be worthwhile. But it was slow and expensive.
People were looking at ways to represent money electronically. There was an effort called “DigiCash” dating to 1990. But nobody could solve the double-spending problem. Then, in late 2010 or early 2011, I started hearing about “Bitcoin.” First thing I would ask: “Have they solved the double-spend problem?” The answer was, invariably, “I don’t know.” I said, “If they have, let me know.”
Finally, two years later, I was having a chat with a guy who was technically knowledgeable. When he brought up Bitcoin, I asked if Bitcoin had solved the double-spend problem, and he said, “Yeah– that’s one of the things I understand they’ve solved.” I said, “Oh, that’s very interesting!” He said, “I don’t know how it works, but it uses some tech called ‘blockchain.’ That was the first time I had ever heard the word.
I googled blockchain and Bitcoin, and within an hour I had read Satoshi’s paper. I realized this was a biggie and was going to have a huge impact. I began digging in and talking about it alongside other tech like mobile computing, AI, and so forth. That’s how I got involved in blockchain.
How did you go from there to founding the American Blockchain Council?
I understood one of the challenges very well, because it’s always a challenge: The first people who hear about new developments are the techies– the geeks that invent the tech or that find out about it from someone else who did. I’ve got a little bit of geek in myself, and the problem is that they tend to get excited about every new thing that comes down the road, every shiny new object. They often don’t distinguish between the huge life-changing things and the cool new tools that they’d like to have.
Non-technical senior executives hear the same thing several times a year: “There’s this great new thing. We’ve got to do it– we’ve got to do it!” But when it comes to senior executive decision-makers of business, non-profit, government, or political organizations, they won’t buy an idea until they understand its strategic implications. They need enough of an understanding of how the technology works and how they can enable these capabilities. It’s not enough to say, “It’s the greatest thing!”
All to often, the answer to “Why?” is “Oh gosh– they’re asking for a detailed technical explanation of how this works.” But that’s not what they need. To see how the technology can improve their organization, they just need a basic understanding of what the technology does and how it works.
By this time, I had already recognized this communication gap with blockchain. It was the same kind of gap that has existed for virtually every other technology. So, I decided it was time to organize the American Blockchain Council, for the purpose of educating senior level executives on the applications of blockchain.
At this point, we’ve primarily focused on education. We started the Blockchain Executive LinkedIn group to help senior level executives share information about the strategic implications of blockchain. That includes business use cases, and how to develop business plans for incorporating blockchain within your organization. We’re now up to over 4,000 members throughout the world.
In addition, I’ve been traveling around the world for the last couple of years, speaking on the strategic implications of blockchain and how you can combine it with other tech like AI, IoT, 3D printing, 5G, augmented reality, and virtual reality. At the same time, I’ve been informing companies and other organizations on how they can go about developing strategic plans, as well as slowly working on a book on the same topic.
Which tech developments would you compare blockchain to, especially in terms of hype/culture/etc? E.g., SSL, TLS, Hypertext, World Wide Web.
As I look back over my 40-plus years of experience and involvement with emerging technologies, there are several that come to my mind as being really game changing. Notwithstanding the missupposition of my kids and grandchildren… No, I was not around for the invention of the computer nor hieroglyphics; but, I was around for the invention of the first personal computers. That was huge.
AI has been different. It didn’t just appear and achieve wide adoption; AI has been evolving for decades and will continue to evolve for decades to come, although that rate of evolution has been accelerating. But, I would certainly put AI in the category of huge, huge impact. It’s maybe the most important of all of these things, although each of them has key roles to play. The Internet and the World Wide Web have been key in fostering economic and social change, on a broad basis and in real time. That’s been good and bad, unfortunately, but all tech can be used for good and bad.
People in information tech often miss the huge future impact of 3D printing. It’s a profoundly different way of making things than we’ve done for hundreds of thousands of years, ever since the first Neanderthals were sharpening rocks to cut fur into coats. Historically, we’ve done subtractive manufacturing, breaking off what we don’t need. But 3D printing now enables additive manufacturing. It’s going to be increasingly important for us.
Then, augmented virtual reality will be fascinating, too. It was initially used for gaming, but it’s beginning to see usage for machine maintenance, field service, and so on.
These are all tech developments that I compare to blockchain in terms of impact. I think blockchain is on par with the other developments because it enables the distribution of trust and unlocks a virtually unhackable means of data-sharing in a business or social ecosystem.
By enabling us to have immutable records, it allows us to prove the provenance and ownership of products or information, and the tracking of who said what and when. In fact, I think it’s going to be incredibly important because of AI-enabled deep fake technology, which will probably be used for malevolent purposes in the upcoming elections.
Maybe it won’t be in time for the upcoming election, but over time, I think blockchain holds promise for validating when info is legitimately real versus when it’s faked. We’ll be able to tell when information has been distributed for the sake of scamming somebody, or for economic and political gain, as might be the case.
I’m most excited by the prospect of combining these different technologies. For example, we’ll be able to combine blockchain and IoT technology to make sure food or pharmaceuticals have been maintained at the proper temperature throughout their respective supply chains. Another application is combining blockchain and 3D printing in order to verify that 3D printers have valid plans and will only print the number of items that were purchased. Blockchain can also verify the accuracy of source-level information, which is necessary for the use of AI. All kinds of exciting applications come together when you integrate these technologies.
Have you ever seen a technology where the founder’s (e.g., Satoshi Nakamoto’s) mission was so integral to understanding the movement?
Satoshi Nakamoto, whoever he/she/they are, played a critical role in consolidating developments of the previous 30 years. He put together these cryptographic and synchronization technologies in such a way that you could, for the first time, have a digital currency which is viable as both a means of exchange and a store of value. That’s critical.
You can certainly compare Satoshi to other key leaders in tech, going back to John McCarthy, who coined the notion of “artificial intelligence” in the ‘50s. You can compare him/her/they to Vint Cerf and Robert Kahn, who enabled the Internet’s creation by developing the PCP protocol. You can compare them to Timothy Berners Lee, who defined how the World Wide Web could be used, and even though the notion of hypertext publishing had been around since the ‘40s, defined a clear and viable Internet protocol for it.
You can compare him to Jaron Lanier, who was one of the early inventors of augmented and virtual reality. Steve Jobs and Steve Wozniak, too, with the invention of the personal computer. There were individuals who played a critical role in every case.
But, we all stand on the shoulders of giants. And at the risk of sounding less than reverent of Satoshi, there were people writing about the obsolescence of governments because of the Internet. After 25-30 years, we now know that it won’t work that way. The same will be true of cryptocurrency, blockchain, and other emerging technology.
I think blockchain is the real gold behind cryptocurrencies. I do believe that crypto represents an important step forward in terms of representing a new store of value and facilitating a new means of exchange. I think the idea of a non-fiat-based cryptocurrency is good, too.
But if you think about it, that was very common until 150 years ago. Banks all over the world printed their own currencies. They weren’t exclusive to national political governments, although there have been fiat currencies dating back to the Romans, and probably even further than that.
So, I think that, over time, cryptocurrencies will prove themselves equal to cash, checks, credit/debit cards, and EFT as a store of value and a means of exchange. The adoption of crypto will mirror the evolution of those other payment methods over the last 40-50 years, with credit cards emerging in the late ‘60s and still very rare into the ‘80s, with debit cards following.
At this point, everybody pays everything with plastic. That is, if you don’t just tap your phone. So, I think we’ll see cryptocurrencies pull right into those mechanisms and make all kinds of payment processes better and faster.
As important as it is to move money around the world, blockchain really offers the greatest value, for voting, for international trade, and for verification and identification of people, especially in third world countries.
I know there are a lot of libertarians and others who think Bitcoin and cryptocurrencies will completely change the way we govern ourselves around the world, and I would be very pleasantly surprised if those changes come to fruition.
But, I do believe that blockchain, in all of its manifestations and including its service as a facilitator of cryptocurrencies, will bring about a much higher quality of life for people all around the world. And that makes me excited.