Will a boom follow Covid-19? A century ago the 1920s saw creative energies explode after the tragedies of the Spanish Flu and World War I. In big cities such as New York, London, Shanghai, Sydney and Tokyo, economic growth was palpable. New technologies such as cars and radios became common. So did a risk-on optimism. I think the 2020s will similarly roar. Here are four reasons (with caveats at the end):
1. Accelerated digital productivity
Back in 2017, Diane Greene, then the Google Cloud CEO, told a Forbes audience that the rate of digital technology progress was accelerating rapidly. She guessed a rate “two to three times faster” than Moore’s Law. Of course, digital technology progress by itself does not guarantee productivity. New business and organizational models are always needed to harness that progress.
Covid-19 did that for us; the pandemic forced rapid business change. Microsoft CEO Satya Nadella has said that five years of digital transformation had taken place in six months. Covid-19 forced companies to become smarter, faster, nimbler. The alternative was failure. No company can revert to slower, dumber and stuck. From a business perspective, the 2020s will be the Agile Decade.
2. Scalable AI
There’s now a convergence of digital technologies—cheap cloud computing, ubiquitous mobile computing (billions of sensors and phones) and faster communications such as 5G—simultaneously reaching maturity. Enter AI—the 2020s will be the decade of enterprise AI.
One more step is needed. Previously, deploying AI always meant hard, labor-intensive, expensive work. But what if AI was easy to deploy and use? What if anyone who can use a spreadsheet could also predict supply chain risks in India or maintenance costs for an Indonesian trucking fleet? That is happening. To adopt Apple’s famous 1980s slogan “a computer for the rest of us,” AI for the rest of us will shape the 2020s.
3. Capital surplus
The world is awash in capital, making it historically easy for entrepreneurs to get funds for innovative startups. While there’s plenty of hype around cryptocurrencies, meme stocks and SPACs, make no mistake. Global capital knows well that digital technology acceleration and AI are game-changers. These will disrupt business models and markets, and power enormous fortunes.
4. Physical world revolutions
Digital technologies, as noted by Greene, are evolving fast. But in the physical realm, progress is always slower—limited by physics and other forces. Yet here, too, progress is accelerating. Drone cameras raise agricultural yields. Autonomous trucks don’t need to take rest breaks. Gene sequencing plus AI will create personalized medical treatments.
Take German startup Lilium. It proposes to bring air travel to the masses with an electric-powered aircraft that can take off vertically yet fly like a plane. Using composite materials and AI, it is designed for autonomous piloting, though a real pilot will be used for now. Unlike most aviation startups, Lilium has has plenty of capital. It represents the post-Covid-19 spirit.
The Roaring 1920s had not one, but two awful stock crashes and depressions. The one many people forget occurred in 1921; it almost derailed the decade. Also prosperity was very uneven in the 1920s. Cities boomed. Rural areas much less. Don’t expect the 2020s to be all good news. But it will be thrilling.