Sean Higgins is the founder and CEO of BetterYou, a product that “nudges” you to make better decisions and work toward your goals. He is also an entrepreneur in residence at Techstars, a partner at Router Ventures, and previously founded VidGrid.

Top 3 Takeaways

1. In schools across all grades, the presence of phones has changed everything from student focus to bullying and has magnified some existing issues, but also presents an opportunity to learn and behave more effectively.
2. For businesses, managing employee wellbeing must now include digital wellness. This also presents both opportunities like more insight into personal health and challenges like invasion of privacy.
3. Smartphone-based tools for managing digital wellness and tech addiction are mostly aimed at monitoring or gating app usage, but there is an opportunity around incentivizing use of and healthy engagement in good content.

Show Notes

• [0:40] What does tech addiction mean for schools and for businesses.
• [2:50] Does the fact that kids are getting phones earlier make bullying worse?
• [4:15] Teachers and counselors have a hard time dealing with tech addiction and the impact of students having phones.
• [6:12] Do incentives for keeping students off their phones work?
• [10:09] Most tech addiction apps on the market are for monitoring or gating use rather than encouraging beneficial use.
• [10:45] What Sean has learned about working with education from building BetterYou.
• [12:50] Where does the responsibility for student success with respect to tech addiction fall?
• [14:50] How business differs from education when it comes to device usage management.
• [21:32] Companies will tie in personal health and happiness with overall health of the organization.
• [22:02] What is the right incentive structure to encourage digital health within companies?
• [23:35] Does a company tracking its employees’ habits for their benefit infringe on privacy?
• [26:30] Trust will be one of the most important elements for brands in the digital wellness space.

Selected Links

• BetterYou
• Jonathan Haidt book
• Part 2 with Sean Higgins
• Part 1 with Sean Higgins

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Dr. Kevin Luhman is a professor of astronomy and astrophysics at Pennsylvania State University and a renowned astronomer for having discovered both the third closest stellar system, now called Luhman 16, and the coldest brown dwarf star ever found, which too will soon bear his name.

Top 3 Takeaways

1. Astronomy addresses the most fundamental questions of humanity such as the origins of life, the origin of Earth, the fate of life on Earth and whether or not we are alone in the universe.
2. Sending humans to Mars won’t be as easy as Elon Musk makes it out to be. Elon is aiming for a 2024 arrival while NASA is expecting around 2034. There are many challenges, most notably deadly cosmic rays, that need to be solved before humans can safely travel to and spend time on the Red Planet.
3. Earth is an oasis of life in the universe. Astronomy can help us appreciate the odds of a place like Earth existing and can provide a unique perspective on the importance of protecting it.

Show Notes

• [0:58] Defining astronomy.
• [1:30] The early influences that led Dr. Luhman to dedicate his life to the study of the universe.
• [3:25] Why should the average person care about astronomy?
• [3:55] Practical examples of how astronomy is used in our everyday lives.
• [5:31] The past, present and future of satellites.
• [8:26] Dr. Luhman describes the events that transpired to now have a stellar system bear his name.
• [10:02] The status of NASA.
• [11:40] What astronomers talk about after work.
• [12:20] When are humans going back to the Moon?
• [14:32] The challenges of sending humans to Mars.
• [18:50] Is Elon Musk’s 2024 target of sending humans to Mars realistic?
• [20:02] Dr. Luhman’s thoughts on SpaceX.
• [20:43] One question Dr. Luhman would ask Elon Musk.
• [20:57] Fun rapid-fire questions to conclude

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary

TheLlamaSir is a content creator on YouTube and Twitch. He has over 1.1M subscribers on YouTube and his videos have been viewed over 100M times. TheLlamaSir primarily creates gameplay and guide videos for Fortnite, but has also created content for Rocket League, Call of Duty, and Minecraft.

Top 3 Takeaways

1. The Llama Sir’s audience is split between those that are interested in the content due to the game, or due to The Llama Sir himself. It’s difficult for content creators to get a strong sense of audience turnover when they switch games, as they typically lose viewers who aren’t interested in the new game but pick viewers up at the same time.
2. As glamorous as content creation seems, it’s hard to get a break. For YouTube content creators, there are always projects in the pipeline to get out to an audience. For live content creators, taking time off reduces income. There are also examples of losing subscribers after taking a break.
3. Being a good content creator on any platform is a skill that takes time to develop.

Show Notes

• [1:44] TheLlamaSir talks about his content creation and his movement into Twitch live-streaming.
• [2:35] TheLlamaSir shares how he started creating content on YouTube.
• [3:38] The moment when he knew he had a big opportunity in content creation, after hitting 100K subscribers.
• [4:52] TheLlamaSir talks about his audience and whether they stick around for the content due to the game or his delivery.
• [5:58] Fortnite felt special from the beginning, similar to Halo and Call of Duty, some of TheLlamaSir’s favorite games from his past.
• [7:30] Balancing games that you what to play with what you think your audience wants to see.
• [8:08] The hidden challenges of being a content creator.
• [9:58] TheLlamaSir creates and edits all of his own content.
• [12:19] TheLlamaSir’s motivations to continue to create content.
• [12:58] The idea generation process, and how Fortnite makes new content ideas easier to come up with.
• [14:50] The future of content creation.

Selected Links

• Fortnite Week 2 Challenges Guide
• TheLlamaSir – YouTube
• TheLlamaSir – Twitch
• TheLlamaSir – Twitter

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Sean Higgins is the founder and CEO of BetterYou, a product that “nudges” you to make better decisions and work toward your goals. He is also an entrepreneur in residence at Techstars, a partner at Router Ventures, and previously founded VidGrid.

Top 3 Takeaways

1. Many products and services employ techniques that play on our behavioral psychology to keep us engaged. Sean and Doug identify many of those techniques and propose tactics and hacks to limit tech addiction and take back your time.
2. Stopping cues, or signals that the user should stop and asses whether they want to continue engaging in their current activity, could be a way to limit tech usage without going against company incentives.
3. Time is the most valuable commodity to us humans, and BetterYou helps users make sure they are spending time on the things that are most important to them.

Show Notes

• [1:25] Sean explains how he sees companies leveraging behavior hacks to keep us addicted to their products.
• [4:15] Doug says just having a phone on your person is an opportunity for content developers to take advantage of your downtime or boredom.
• [7:14] Sean introduced the concept of stopping cues – signals that you should take a moment to think if what you’re doing is actually what you want to be engaging in.
• [8:20] Netflix’s third-biggest competitor is sleep.
• [9:45] Doug explains the current self and future self dynamic.
• [14:45] Could services introduce a “break” product that generates revenue and promotes digital health?
• [18:20] Why emotions like anger are a form of addiction and how news apps prey on them.
• [26:35] Other “counter-hacks” you can use to limit the effects of tech addiction.
• [36:30] Does using tech less make us less likely to upgrade our devices and threaten companies like Apple?
• [37:50] Time is the most valuable commodity for human beings. How does BetterYou help people allocate that time to what they think is most important?

Selected Links

• BetterYou
• Skinner box conditioning.html">study (intermittent variable rewards)
• Bottomless soup bowl study
• Goodphone.co

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Sean Higgins is the founder and CEO of BetterYou, a product that “nudges” you to make better decisions and work toward your goals. He is also an entrepreneur in residence at Techstars, a partner at Router Ventures, and previously founded VidGrid.

Top 3 Takeaways

1. In 2017, 90% of discretionary time was spent on a screen vs. 37% in 2007.
2. Many common products employ more behavioral engineering that we realize. This means they play to our innate desires and tendencies to drive engagement and keep us on the platform as long as possible.
3. BetterYou allows a user to input their goals, and it works in the background to keep you on track. BetterYou analyzes the data exhaust from using your device find areas where you are being inconsistent with what you said were important to you.

Show Notes

• [0:45] How Sean thinks about the problem of tech addiction.
• [2:40] Why 2007 and the launch of the iPhone was the tipping point for tech addiction.
• [4:17] Actions you can take to limit your use of tech.
• [6:45] Sean explains behavioral design built into apps that want to drive engagement.
• [9:23] The efforts of Apple and Google to bolster awareness of device usage.
• [11:14] Sean explains what it’s like to use BetterYou.
• [15:48] The power of incentives and reinforcement in changing your tech behavior.
• [17:23] Do we stand a chance against data0driven companies that know how to capture our attention so well?
• [18:57] Where can we learn more about the problem of tech addiction and potential solutions?

Selected Links

• BetterYou
• Irresistible by Adam Alter
• Tristan Harris blog
• Hilarie Cash’s reStart Clinic

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

We pride ourselves on contrarian curiosity. When that curiosity leads us to new conclusions, we change our minds. As part of that exploration, the areas that we find most interesting evolve over time. What was once frontier eventually becomes commonplace. We’re committed to updating our investment thesis as necessary through a living manifesto derived from our ongoing research process.

A little over a year and a half ago, we launched Loup Ventures and published our Manifesto outlining our vision of the future — a world more automated by AI and robotics and more experiential through VR and AR.

Since then, some things have changed, and some things have stayed the same. One thing has even changed and stayed the same: we’re bigger believers than ever in the emerging wave of innovation around automation and experience.

It’s no longer a question that the world is becoming more automated. We’re already seeing automation influence how we work, shop, and move. The efficiency we expect in those categories has also rubbed off on how we communicate with one another — we expect more meaning in less time.

As automation frees time for leisure, we’re finding new ways to create and play. Of course, all experience ultimately happens in the brain, and we’re seeing technology that interacts directly with the brain to change how we experience the world.

Our original vision to invest across AI, robotics, VR, and AR has evolved: We invest in frontier tech companies automating the world and building new ways to experience it.

• The Future of Work: We still think that 70% of jobs will be disrupted by automation long term, but it may take longer than we originally imagined.
• The Future of Retail: 1) Online commerce will slowly rise from ~10% today, closer to 55% long term; 2) Automated retail represents nearly a $50B opportunity; 3) We’re also bullish on empathic retail – uniquely human, personalized shopping experiences.
• The Future of Transportation: By 2040, we expect that over 90% of all vehicles sold will be “Highly” and “Fully” autonomous systems, classified as Level 4 and 5 automation, respectively.
• The Future of Communication: We spend 69% of our waking hours consuming information, so products that allow people to consume more meaningful information in less time will win.
• The Future of Play: In an automated world, we will be afforded more time for leisure and play. In our view, the interactive nature of gaming will heavily influence the future of play.
• The Future of the Brain: Neurotech allows us to manipulate the brain’s signals, enabling us to directly influence intelligence and experience – augmenting human capability.

The Future of Work

In our first manifesto, we talked about the potential for 70% of jobs to be disrupted by automation long term. We still think that will be the case, but it may take longer than we originally imagined. We also have a brighter view on the creation of new jobs uniquely suited for humans. Net-net, while labor will certainly be disrupted by automation, jobs will exist for humans in the long-term future. As such, we see four core opportunities in the future of work: human-in-the-loop, human-as-AI, pure AI, and pure human.

For at least the next decade, there will exist a gap between what enterprise customers want AI to do and what AI can viably do. To that end, we embrace the reality that humans, in many ways, are robots. We’re all full of habits (programs), biases (programs), and skills (programs). Humans will serve as the most efficient “AI” while we develop and train purely machine-driven forms. This is where the first two future of work opportunities exist.

1. The human-in-the-loop opportunity enables humans to be augmented by machines to perform tasks more efficiently. For human-in-the-loop, machines may be able to perform the majority of a task but need humans to finish it or take over in complex situations. An example is a call center that uses AI to handle basic requests, but turns over difficult situations to a human, or an autonomous vehicle that turns over control to a human, either in the vehicle or remotely, to navigate challenging environments.
2. The human-as-AI opportunity creates a rigid set of instructions or processes for humans to follow as if they were a machine. There are certain tasks that are just more easily and efficiently done by humans. At least for now. For things like calendar management there are personal and business nuances that must be understood to do the task well, events that aren’t on one calendar or another, people that should be ignored or deflected, control over how events are grouped, preferred meeting locations, etc. For a machine to understand the all the nuances of scheduling is difficult. It’s not impossible, it’s just more practical today to have a human do it if you want it done well. Another example is a human using augmented reality to get instructions from a machine to perform a specific task. Both of these opportunities are most likely to impact entry level workers.
3. The pure AI opportunity is automation as we all think about it — robots handling a task completely. Robots are especially well suited to perform repetitive tasks, both physical and digital, because they don’t need breaks and can work faster and with more precision than humans. Manufacturing, agriculture, and industrial applications are all beginning to use fully autonomous robots that monitor inventory levels, pick produce, and move vehicles. See more of our work on robotics for details.

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Source: Loup Ventures

As the pure AI category slowly replaces jobs created by the first two opportunities, the aforementioned 70% job disruption will become a reality. While some observers fear this disruption as permanent, we see a different future where both blue- and white-collar skilled jobs disappear while new jobs emerge.

Pure human jobs will be driven by uniquely human capabilities: creativity, community, and empathy. These are the long-term future of human work because they are outputs that only a human can authentically deliver. Creative pursuit of the arts will become more valuable as work and play merge. Communities can only be led by human beings. Empathic, human-led customer service will be a true differentiator for businesses that are otherwise automated. If we do it right, we should be able to create a world where robots perform tasks for which they are optimally suited, and humans will do the same. The future of work is bright, not bleak; especially for humans.

The Future of Retail

We see the future of retail in three buckets: online commerce, automated retail, and empathic retail.

1. Online Commerce still makes up only ~10% of total commerce excluding gas and groceries. We estimate that number could eventually reach 55%. As crazy as it may seem, we’re still in the early innings of online commerce. 63% of Americans live within 20 miles an Amazon fulfillment center or Whole Foods store, according to data from Piper Jaffray. Amazon’s network is impressive, but not good enough. Tighten the range to 5 miles and the addressable customer base drops to just 12% of Americans. Same day delivery isn’t solved yet. It’s why we still see $35 minimums and $5 on-demand delivery fees. There remains an opportunity for online retailers to broaden the distribution network and improve their same day delivery solutions. In our view, more efficient same day delivery will drive the next step change in online commerce growing as a percentage of wallet share. The biggest challenge for online retailers is, unsurprisingly, figuring out how to compete with Amazon. Offerings built around proprietary brands and products seem to have the best chance, and we’re likely to see a continued emergence of these types of brands that try to own a large niche.

1. Automated Retail took a big step forward with Amazon’s Amazon Go store. While Amazon may have created a great experience with Go, the technology is expensive and impractical to apply to retail formats larger than a convenience store; however, anywhere retailers compete primarily on price, automation must be the future. Reducing employee overhead will enable lower prices for consumers and, if the technology is applied correctly, a better experience. In 2016 there were 3.5 million cashiers in the U.S., according to the Department of Labor, with an average salary of $13,574 (Data USA). That represents a nearly $50 billion opportunity in cashier-less retail. Of those 3.5 million cashiers, 323,000 are convenience store or gas station employees, 9% of the cashier workforce. We expect c-stores to be the first category to undergo the dramatic shift to automated retail.

1. Empathic retail ties directly to the core human traits that represent the future of work. Of the three future of retail categories, empathic retail is the most nascent and also the most open for innovation. For offline retailers that wish to compete on a basis other than price, their premium will be driven by the experience they provide shoppers.

Humans, not robots, are likely to deliver the greatest differentiated experience. There’s a quality of connection when your favorite retail locations know who you are and what you like that’s hard to replicate. We think great customer service delivered by humans will become the most valuable differentiator in an empathic retail space and be augmented by AI and robotics, but not replaced by them.

The Future of Transportation

We see a future where humans not only won’t have to drive but won’t be allowed to drive. Admittedly, we’re still several decades from achieving that future, but autonomous transportation feels, in many ways, like a foregone conclusion. Billions of dollars have been invested in autonomous driving platforms and we’re beginning to see early solutions come to market like Tesla’s Autopilot (level 2 enhanced ADAS) and Waymo (level 4), but it will likely take billions of dollars more before we reach a fully autonomous transport future. See our Auto Outlook 2040 for details.

Vehicle-Penetration.png" alt="Autonomous-Vehicle-Penetration" width="698" height="446">

Source: Loup Ventures

Despite the amount of investment and attention on autonomous vehicles, our infrastructure is well behind our vehicles. Smarter energy grids, EV charging, roads, and maintenance will all be core components of our autonomous future. Governments seem to be interested in investing in these technologies but will be slow to act. Companies that find ways to limit upfront costs to cities and push the majority of monetization to private players in the transit ecosystem are most likely to thrive.

Experience will be a major derivative benefit from the move to autonomous transit in several ways. First, since humans will be free from the task of driving, they will have more time to engage in communicating with others, creative work pursuits, or other play. We’ll also recoup lost time spent in traffic. Second, the many dangers of the road, namely distracted driving, will be eliminated. Third, vehicle ownership will transform, which may free dollars up for other discretionary spending. Fourth, urban and suburban centers will change. Vehicles, whether corporately or personally owned, will stay maximally utilized by fleets. Parking should be a thing of the past, which will allow streets to be lined by trees and pedestrians. And people on scooters. And delivery robots.

The Future of Communication

Meaning divided by time. That is our simple fundamental thesis on how the future of communication will evolve. Products that allow people to consume more meaningful information in less time will win. Products that allow us to reduce holistic noise and allow us to tell more engaging stories will win.

Information is plentiful. We spend more time with information than ever before, from more sources than ever before, including social media and professional content. Thus, content has to be extremely compelling to break through in our busy lives. The richer, more creative, and more compelling the content (relevance is an everlasting imperative as well), the more we will want to consume it. See our piece on the future of information consumption for details.

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Source: Loup Ventures

Much of the innovation over the past decade has happened for asynchronous communication tools from Twitter to Instagram to Snapchat; platforms where real-time engagement isn’t necessary or expected. Synchronous communication tools have, by comparison, languished. While we have multiple video conferencing tools like FaceTime, Hangouts, Skype, and Zoom for synchronous communication, they haven’t transformed the way we interact on the same order as the aforementioned asynchronous tools. There’s still an opportunity for a step-function improvement in synchronous communication that will shift users toward live and real time.

This doesn’t mean we’re done innovating in asynchronous communication either. Tools for both mechanisms will continue to evolve by leveraging product features like time restrictions, non-fungible content enhancements, combining multiple content formats, and, of course, augmented reality. All of these mechanisms enhance meaning/time, which enhances our experience as consumers.

The Future of Play

Humans love competition and entertainment. That’s why we watch sports. That’s why we love games. With more time available for leisure in an automated world, we will be afforded more time to engage in play.

As we’ve already witnessed with the rise of eSports, the future of play will not be beholden to traditional sports. Gaming will be the basis for much of the evolution of play. Like traditional sports, games are accessible to all, but mastered by few, and anywhere there is a skill to be mastered, there is beauty. We watch in awe as Ninja plays Fortnite just as we watch Lebron play basketball.

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Source: Loup Ventures

The interactive nature of gaming will influence the future of play. ‘Live’ and ‘sports’ have always gone well together. We want to see greatness as it happens, not in a replay, to gain the social credit of “being there.” Live streaming combines the excitement of being there with a unique ability to engage with fans in ways not possible in traditional sports. We see this combination as the blueprint for new sports and other forms of play to amass large fan bases.

While gaming will be a large component of the future of play, passion activities like music, art, and other forms of human creativity will also enrich and entertain us. Platforms will emerge to not only encourage, but also financially reward participants as play becomes work. See more of our work on gaming for details.

The Future of the Brain – Neurotech

The human brain is the basis for both intelligence and experience. Neurotech allows us to understand, and even manipulate, the brain’s signals, allowing us to directly influence intelligence and experience. Our focus on neurotech could be considered the future of the future of experience, since it will have a profound impact on how we engage with the world through both clinical and consumer applications.

On the clinical side — typically invasive/implantable medical devices — our growing ability to simulate sensory experience and stimulate motor function can solve previously unsolvable problems. We have, for example, already witnessed groundbreaking work to restore motion in paralyzed patients. The next frontier is sensory information: we’ve heard about efforts to restore high-resolution vision to patients with retinal degeneration. A growing number of devices on the market treat pain through neurostimulation rather than pharmaceuticals.

On the consumer side — exclusively noninvasive devices today — we can control things like video games and cars with our minds. We can learn new skills more quickly through specialized neurofeedback devices. And we’ve only just begun.

In the longer-term future, neurotech could truly augment what it means for us to be “human.” Ideas exist for memory augmentation and brain preservation. We expect eventually we’ll find a way to simulate consciousness on a computer. While these probably require decades or more of technological and societal advancements, they illustrate a simple reality that drives our neurotech thesis: The brain is the key to all things in life, and to life itself. See more of our work on neurotech for details.

Conclusion

In our original manifesto, we outlined a future of vast automation and limitless, life-like experience; a future that would make Arthur C. Clarke proud. We still believe in that future and the path is slightly clearer than before. Some fear our vision for the future because progress always brings new challenges, but our future is bright. Human desire drives innovation, adaptation, and survival.

We called it utopia; however, utopia, like many things in life, is relative. Utopia today raises expectations such that it isn’t utopia tomorrow. We may only approach utopia every now and then, but it’s always the journey that makes the destination worth it. Loup Ventures is excited to pioneer that journey.

By Doug Clinton with Gene Munster and Andrew Murphy

Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.

Brave early adopters are the hallmark of an innovation set to create immense human value. In this story, the innovation is cutting-edge technology for interfacing with the nervous system, and the brave early adopter is Ian Burkhart.

Ian, a young man in his mid-twenties, suffered a C5 spinal cord injury (SCI) during a diving accident in 2010. The result was bilateral paralysis below his elbows. With an admirably positive attitude and a wonderfully helpful community, Ian was able to make modifications to his life and still live with a sense of meaning.

One of the primary factors motivating Ian forward through the years of rehabilitation was the strong hope that, at some point in his lifetime, there would be biomedical advances capable of giving him back use of his hands.

As it happened, such a possibility crossed his path.

images-1.medium.com/max/1600/1*-c9ar_IT-WWPLr6zfaAU9Q.jpeg">Image: https://ianburkhart.com

In 2014, Ian was presented with an incredible but uphill opportunity led by Dr. Chad Bouton of Battelle (he’s now with the Feinstein Institute): a team of researchers was looking for a patient to test out a system for restoring movement to the hands of a paralyzed patient. The catch was that it required brain surgery and extensive training.

There are 5.4 million Americans living with some form of paralysis, and Ian is acutely aware of the challenges they face. But optimism is one of his defining characteristics: given the chance to pioneer a technology that could bring massive human value, he was willing to make a sacrifice. And so, in 2014, Ian risked his life by undergoing electable brain surgery, implanting a manmade electrode array into the left motor cortex of his brain.

Over the four years since the operation, and hundreds of hours of tedious and extremely difficult training, Ian has collaborated closely with a team of researchers to improve the brain-machine interface system. Ian can now use the technology, which acts as a “bypass” to his damaged spinal cord, to play Guitar Hero using his right hand.

images-1.medium.com/max/1200/1*KkgRm_B6plwD9atg3N8OTw.jpeg">Image: PBS

The body has two information pathways, the vascular system and the nervous system. The typical conception of physiological medical care is that treatments should leverage the body’s vascular system, as in the case of pharmaceuticals; Ian’s system, in contrast, is based on the principle that medical care can be given by interacting with the nervous system. The names of the fields that embody this innovative approach are bioelectronic medicine (BEM) and brain-machine interfaces (BMI).

Brain-machine interfaces are technological systems that read from and/or write to the brain. Bioelectronic medicine systems are technological systems that read from or write to the nerves in your body (the peripheral nervous system). Both of these types of neural interfaces can provide therapeutic value through the insight to target medical interventions at the nervous system rather than just the bloodstream.

At Loup Ventures, we invest in domains of frontier technology that offer strong investment opportunities built on delivering unique human value-add. Bioelectronic medicine and brain-machine interfaces check both boxes with bold strokes. We’re here to explain these technologies and why you should care about them.

Starting with a story

Ian Burkhart was originally approved by the FDA to participate in a year-long trial using a Utah Array electrode implanted in his left motor cortex. When fully hooked up in the laboratory, the signals recorded from the Utah Array, a type of intracortical multielectrode array, are decoded by a neural decoding algorithm and used to control 130 surface electrodes wrapped around his right forearm (which he can’t move on his own). When current is run through the surface electrodes, it causes muscles in Ian’s forearm to contract in particular ways, ultimately controlling his hand movement. In other words, the researchers aim to understand what Ian’s neural activity looks like when he’s thinking about moving his hand. With this understanding, they can use his neural activity to decipher when he wants to move his hand. Then, knowing that he wants to move his hand, a computer program controls his muscles via the electrodes so he can actually move his hand. In essence, they skip right over the spinal cord injury responsible for his paralysis.

images-1.medium.com/max/1200/1*_98Q7AgpJbsDhMLum38_8Q.png">Image: biomedicalcomputationreview.org

Ian and his team of researchers have been so successful that the FDA has extended the experiment multiple times; he’s now in his fourth year of participation.

Loup Ventures recently had the pleasure to talk with Ian about his experience and his outlook. Here’s some of what we learned (listen to one of our conversations with him on our Neurotech Podcast here):

• Each day he uses the system, Ian has to retrain the algorithms that decode his neural activity. This is because the specific neural activation representing his thoughts changes frequently due to neural plasticity. When Ian first started with the BMI system, he would leave training sessions mentally exhausted. Over the years, however, it’s become much easier; training isn’t something he has to pay much attention to, now. This has implications for future BEM/BMI technologies: it will be critical to minimize training time and repetition and to make the necessary training as pleasant as possible for the user.
• Ian has spent time learning about the neural decoding algorithms themselves to the extent that he understands the different parameters the research engineers can tune. Now, when Ian is trying to make the BMI perform as well as it can, he can suggest that the researchers adjust specific parameters. This is similar, in a sense, to adjusting the speed of your mouse cursor on your computer screen. In general, this insight from Ian suggests that BEM/BMI systems ought to be designed like any piece of software, where there’s a symbiosis between the user and the machine. The better the user can intuit how the machine will understand him/herself (and vice versa), the more effective the system will be. Ian is very insistent that in order for mass adoption, the technology must be user-friendly; just because its value proposition (i.e. returned movement) is so large doesn’t mean that normal human-centric design considerations can be thrown out the door.
• Even though Ian is very excited about the progress he’s making with the research system in a laboratory setting, he can’t take the system out of the lab yet—partly due to regulation and partly due to the unwieldiness of the technology.
• Even amongst spinal cord injury patients, Ian sees resistance to the adoption of brain-machine interfaces. This paper has great data about which types of interfaces paralysis patients would be comfortable with, given specific types of benefits they can receive. For example, as compared to typing, controlling a cursor, and moving a robotic arm, patients were overwhelmingly most interested in using neural interfaces to control the movement of their own limbs.
• Ian emphasized to us over and over again that brain-machine interfaces and bioelectronic medicine systems must be designed to provide as much value to the user as possible; this bears repetition since most systems are currently in the hands of research scientists and research engineers, not user experience designers.
• We’re discussing a technology that plugs directly into a human brain; this conversation would be woefully incomplete without discussing ethics. Ian pushed this point, since he clearly sees the potential for good in neurotechnology, but acknowledges there’s also potential for bad. One example we think is particularly relevant given current conversation about software platforms is user privacy. User privacy takes on a whole new meaning when the data isn’t just behavioral (like clicking on an ad), but neural. Through the talks he’s given and the other SCI patients he’s spoken with, Ian recognizes that there will be big pushback on technologies that interface with the nervous system, and we think the pushback can be healthy if addressed constructively. With current screen-based interfaces, there have clearly been both positives and negatives. In general, as technology becomes more directly able to “extract” information from, and “input” information into us, the privacy and digital wellbeing stakes get higher. Any foray into the therapeutic benefits of BMI/BEM—whether as an interested onlooker, an investor, a researcher, or a company—would be ill-advised without strong considerations for, and safeguards to protect, the ethical implications of the BMI/BEM product.

In general, we take inspiration from Ian’s conviction about the positive value of nervous system-based interventions, and we take direction from his emphasis on the necessity for BMI/BEM engineers to focus on the practical value of their products. In speaking about his work to improve his own system for movement restoration so that other patients can use it, he says, “I see my involvement with the study as a job that I have to succeed in.” He sees no other choice; the upside is just too large to ignore.

The general bioelectronic medicine approach

Now that we’ve discussed bioelectronic medicine and brain-machine interfaces from the perspective of a real user, we’ll describe these related domains and their benefits to conclude this introductory article. Although the fields of bioelectronic medicine and brain-machine interfaces speak to different use-cases (bioelectronic medicine involves the peripheral nervous system and treats or diagnoses disease in the body; brain-machine interfaces involve the central nervous system and address sensory deficits and cognitive/affective disorders), we’re going to discuss both under the header of “bioelectronic medicine” for the sake of brevity and comprehensibility.

At its highest level, bioelectronic medicine simply uses electronics to interface with the body where previously, chemicals/drugs would have been used. There are three basic components to any BEM system: a body, a device (either inside or outside of the human body), and a computer. In plain English, there are two general ways to use a BEM system:

1. A device is used to record electrical or chemical signals from the body, and a computer interprets those signals in order to understand the state of the body or a specific system within it.
2. A device is used to stimulate electrical (or other) signals within the body in order to have a desired therapeutic or enhancing outcome, and a computer controls the stimulation.

Some examples of BEM systems include: brain-machine interfaces for restoring movement to paralyzed patients, as in the case of Ian Burkhart; the-argus-ii-prosthesis-system-pf-en.html">retinal prostheses to return vision to the blind; stimulating the vagus nerve to treat rheumatoid arthritis; and recording electrical signals from the vagus nerve to understand the state of the body’s inflammatory response.

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The latter two use-cases exemplify an aspect of bioelectronic medicine that differs from central nervous system-focused brain-machine interfaces: bioelectronic medicine leverages reflexes. In this sense of the word “reflex,” we refer to the idea that the brain both keeps track of and controls organ function using peripheral nerves. This keeping track and controlling is a reflex to preserve homeostasis.

Regulatory and cost advantage

Aside from providing novel treatments and diagnostic opportunities that have yet to be achieved with pharmaceuticals, bioelectronic medicine products offer significant advantages over pharmaceuticals in terms of the FDA regulatory process. All medical devices and drugs are subject to regulation by the FDA. However, it takes between 30–50 months for a medical device (BEM devices classify as medical devices) to get through the FDA, as compared with 144 months for a drug to get through the FDA. A direct correlate of this is that BEM device development is significantly less expensive than pharmaceutical development: BEM devices cost ~$100M for high-risk devices, whereas drug development can require the-real-costs-of-developing-a-new-drug.html">on the order of ~$1B (although the exact cost is uncertain and fluctuates).

Frontiers

There are several frontiers of bioelectronic medicine: technological, scientific, and social/political. Technologically, devices to record and stimulate the nervous system need to be able to record and stimulate at smaller spatial scales and to operate wirelessly (without a wire running from the implanted device, out of the skin, and to a power source). Additionally, neural recordings will be fused with sensors under development that focus on biological signals such as the activity within individual cells. In terms of basic science, researchers need a better understanding and more detailed atlas of the peripheral nervous system and are additionally working to characterize other nervous system reflexes within the body (“reflex” in the sense we described above). Finally, on the social/political front: although public forum discussion of BEM and BMIs is rather small right now, it’s likely that conversation picks up over the next ~5 years as ambitious interface companies like Neuralink, Kernel, and Paradromics hopefully bring progress to bear; almost certainly, the public conversation will focus on privacy and ethics.

Market size: understanding the prospects

To understand the massive market for therapeutic devices that interface with the nervous system, we’ll list six example opportunities and their respective market sizes:

• Spinal Cord Injury – 280,000 patients in the US as of 2016, with a $2.3B global market as of 2017.
• Alzheimer’s Disease – 5.7M patients in the US, with a $1.7B market in North America as of 2017.
• Amyotrophic Lateral Sclerosis – 30K patients in the US, $16M market in the US as of 2018.
• Stroke – 795,000 strokes per year in the US (144,000 deaths per year caused by strokes); $6.5B market in the US as of 2016.
• Rheumatoid Arthritis – 1.5M patients in the US; $11.5B market in the US as of 2016.
• Mental Health/Substance Abuse – 43.8M adults in the US experience mental illness annually; based on data through 2013, the US mental health and substance abuse services industry was expected to produce $53.2B in revenues in 2017.

Expanding beyond these specific use-cases, any new class of treatment and diagnostic methodology like bioelectronic medicine is likely to have effects that trickle down and impact a large portion of the $3.3 trillion dollar US healthcare industry.

In Conclusion

In this piece, we’ve introduced the concept of bioelectronic medicine and brain-machine interfaces: providing therapeutic value to patients by interfacing with their nervous system instead of their bloodstream. We see huge opportunity in this space, driven by novel interfaces to the nervous system and new disease treatment paradigms. As we saw with Ian Burkhart, bioelectronic medicine and brain-machine interfaces are domains with enormous value to add, but whose development will be intricate and require careful ethical considerations. Stay tuned as we dive in-depth to understand the science, technology, and business of bioelectronic medicine.

Special thanks to Ian Burkhart for sharing with us his story and insights. Through the Ian Burkhart Foundation, he works to improve the lives of individuals with spinal cord injuries.

Disclaimer: We actively write about the themes in which we invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

• CNBC reported on Friday that Amazon is building a health and wellness team inside its Alexa division to work on making Alexa a better tool for healthcare.
• Amazon, Berkshire Hathaway, and JP Morgan recently announced plans for a joint healthcare company focused on reducing costs and improving care for their combined 1.2m employees.
• The $3.3T U.S. healthcare industry is notoriously slow to innovate.
• We think Amazon will change healthcare on three fronts: 1) Logistics: Help reshape the $453B Pharmacy Benefit Management industry; 2) AI: Alexa will help both patients and providers with everything from in-home care to allowing providers more time with patients instead of paperwork; 3) Cloud: AWS will continue to allow Amazon to partner with the world’s leading patient data networks.

Dr. Alexa

Today’s news around Amazon’s new Alexa healthcare team got us thinking about Amazon’s prospects for breaking into healthcare.  Companies across the entire healthcare industry are quickly discovering that AI will be used in everything from operations to enhancing quality of life for patients. Imagine the safety, information, connectivity, and entertainment that an Alexa near every hospital bed could offer patients.

Amazon’s Medical History

Amazon’s first foray into healthcare came with a 2014 deal with Cardinal Health leveraging Amazon’s e-commerce capabilities to sell medical supplies to hospitals and clinics. Amazon announced another major move into healthcare when they, JPMorgan Chase, and Berkshire Hathaway outlined plans to start a company that would provide and manage healthcare for the three companies’ combined 1.2m employees, focusing particularly on reducing costs. Separately, Amazon announced that they have put their plans to become a pharmaceutical wholesaler on hold (for now). The company found it difficult to bring major hospitals on board due to their reluctance to deviate from the purchasing process they’ve grown used to. 

Amazon’s Next Moves

We believe Amazon will have a major impact on the $3.3T U.S. healthcare industry by leveraging three core competencies: Logistics, AI, and cloud infrastructure to transform delivery of care, population health management, and healthcare software services.

1. Logistics: Logistical expertise will most directly impact the highly concentrated Pharmacy Benefit Management (PBM) sector. Rising drug prices and rising drug demand has driven considerable backlash recently among American consumers. We feel this could be a golden ticket for disruption to a cost-conscious, logistics expert like Amazon.
2. AI: Alexa’s artificial intelligence could significantly reduce the amount of busywork for doctors and accelerate the adoption of in-home telehealth. From checklists to note taking to logging patient symptoms, Alexa could streamline many healthcare operational functions by eliminating menial tasks and allowing providers to spend more time with patients. In the home, patient rooms, and at senior living facilities, Alexa could do everything from reminding patients to take their medicine, to helping manage care for diabetics, to helping patients notify staff if they’ve fallen.
3. Cloud: Amazon’s $5.4B AWS business is poised to provide incumbent electronic health record systems with the storage, analytics, and population health management tools needed to provide a full stack of services around patient data. Evidence of this came as Cerner, one of the world’s largest health technology companies, partnered with AWS to utilize the platform’s data analytics strengths to provide more real-time care coordination amongst providers. Cerner also looks forward to leveraging Amazon’s AI to take a more proactive approach to cross-sector population health and wellness, and we anticipate they will be one of many healthcare firms in the future using AWS in similar capacities.

Whole Foods + Healthcare

The acquisition of Whole Foods gives Amazon another unique product and product delivery method, although we can’t call it a core competency yet. Food as medicine will be an important part of healthcare’s future and, as a leading grocer, Amazon is well-positioned here. Whole Foods locations also provide Amazon with the physical presence, and the brand recognition in health and wellness, to potentially address the need for more convenient healthcare clinics.

Bottom line

Amazon’s aspiration to be “Earth’s most customer-centric company” provides it with seemingly unlimited growth potential (and uncanny ability to find success in new markets). While they may be king when it comes to e-commerce, their entry into the healthcare market will likely prove to be one of their toughest tests to date. They face an extremely complex and concentrated industry and the regulatory quagmire that comes with it. Amazon has its work cut out in convincing the healthcare system that it belongs at the table, but it’s made sensible first steps and we’ve learned not to bet against them.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

Ready Player One showcased both the promise and the pitfalls of our technological future. A virtual world that enables your wildest dreams, on demand, on top of a real world that rots in decay because the virtual one is so much better. All great sci-fi achieves this balance — a healthy observation about what can go right and how right can evolve to wrong.

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The core insight of science fiction is that all technologies live on a spectrum of good and evil, useful and harmful, and our perception of their place on that spectrum vacillates over time. It’s a truth that we’ve long known innately but are now being forcefully reminded of in our real world. In just the past couple months, we’ve dealt with major Facebook data privacy issues, multiple self-driving car accidents, and increasing discussion about smartphone addiction. These technologies that were largely accepted, if not embraced, have turned on us. Perhaps it’s more correct to say we turned on them.

All technologies live on a spectrum of good and evil, useful and harmful.

So, what is it that turns technology from good to evil in our eyes? It seems to happen for one of two reasons.

First, in the early adoption phases of any technology, the majority tends to have a healthy skepticism laced with fear. It’s the reason why most people don’t adopt new technology, only innovators. When a new technology has early failings, the skeptical, fearful majority find reason to double down. They feel validation and their skepticism grows, allowing them to make a case for why some new technology is more evil than good; why it should never exist. This creates an even higher hurdle for a new technology to move into the early adoption phase. Autonomous vehicles seem to be living through a mild version of this scenario now. In fact, the discussion about the perils of AI in general also fits here.

Second, in the later stages of adoption when a majority of people use a given technology, consumers tend to view the technology with a dose of fear laced with resignation that can easily flip to anger. When people believe that too much power is consolidated in any endeavor, technology included, there lurks a possibility of revolt. That possibility turns to reality when power is perceived to be abused and anger takes over. Evil is perceived to outweigh good, and people question whether they want to continue to engage in using the technology. Facebook is living through anger-driven revolt now. You could argue that the firearm debate also fits in this category.

If a technology avoids the anger phase for a long enough period, it can move into a stable acceptance of the good and the bad. An example might be the car, which enables large scale movement of humanity and suburbanization, even though over a million people die every year in car accidents and gasoline-powered cars pollute the environment. The Internet fits here too, even if the smartphone as an extension of the Internet does not yet. Apple is doing all it can to demonstrate its respect of the power it wields in bringing highly addictive Internet services to everyone, all the time.

Just as Viktor Frankl observed that, “No group consists entirely of decent or indecent people,” no technology is purely decent or indecent; none is purely good or bad, which are human judgements anyway. The lesson from Ready Player One as well as our situation today is that we should always be willing to accept good with evil as it comes to technology. We should think about what all technologies will mean to humans first, not how exciting the technology is or how much money it could make or some other measure about what the technology could do. Our guiding light should be to ask, “How sure can we be that this technology will improve human life?” If we can’t get comfortable with that answer, we should be prepared to revolt. If we can get comfortable with it, we should be prepared to accept.

Disclaimer: We actively write about the themes in which we invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

• Epic Games’ Fortnite has exploded in popularity over the past few months for four reasons.
• 1. It’s accessible to all (free to play, compared to similar games that cost $60, and easy to play, different than most complicated console games).
• 2. It’s fun (Battle royale style).
• 3. It’s high-quality (frequent gameplay, weapon, and skins updates).
• 4. No pay-to-play advantage (keeps level playing field. Most games make money selling play advantage).
• We believe these four factors will result in Fortnite being a top 5 game for the next several years.

Fortnite 101

Fortnite is a battle royale game, where 100 players parachute onto an island with the goal of being the last one standing at the end. A “storm” serves as a boundary that closes in at set intervals, shrinking the playable area and forcing players closer and closer together. Players begin with no equipment and must scavenge around the island looking for weapons and supplies to give them an advantage over the opposition. Fornite has screamed to the top of gaming titles recently and is the number 1 most viewed title on Twitch as of this writing.

Easily accessible to all

Fortnite is an extremely accessible game in a number of ways. For one, it’s free, making it easy to convince friends and family to try it out versus console games that usually run about $60. This is a major reason for its fast ascension to cultural phenomenon. When gamers see their friends playing a game or want to try a new one, they often must consider if it’s worth the investment. With Fortnite, users are able to play the online multiplayer without any upfront cost.

Another facet of its accessibility is the graphics and visuals. The aesthetic of Fortnite is cartoony and a little silly, which makes it much easier for parents to get on-board and expands the audience of the game to a younger demographic. There is no gore, no dead bodies lying around and the weapons feel less like instruments of destruction and more like they’re made by NERF or SuperSoaker. PlayerUnknown’s Battlegrounds (PUBG), the first major battle royale title, has a much grittier, more realistic aesthetic that is targeted to an older audience. Fortnite looks and feels like it’s directed at kids, but has enough complexity and a high enough skill ceiling that it keeps older, more competitive players interested as well. It’s an example of the old adage, “easy to learn, difficult to master.”

Furthermore, it’s playable across platforms. It is available on PS4, Xbox One, PC, and iPhone, with Android support coming soon. Fortnite also supports cross-platform play, so players on the PC can play with their friends or family who play on Xbox (though PS4 and Xbox players can’t play together, Sony is blocking the option). This is the first time that this has been possible for any video game and could prove to be a major milestone for online gaming.

It’s fun, battle royale’s rise

Battle royale games are a relatively new phenomenon. One of the keys to Fortnite’s meteoric rise is that this genre is inherently fun. The longer the game lasts – and the closer you get to victory – the higher the stakes and the higher the stress. The exhilaration of being one of the few remaining players is a significant factor in the game and the genre’s popularity. Ultimately winning a game, emerging as the lone victor out of a hundred other players is an incredible feeling not found in other game modes. While Fornite was not the first game to embrace this format it was one of the earliest and brought its own unique spin by allowing in-game building of walls, ramps, and roofs. The building mechanic adds another layer to the game for players, giving them the ability to quickly reach previously inaccessible locations and create cover or an escape route under fire.

High-quality game

Fortnite’s battle royale format and accessibility would be non-factors if it weren’t for the fact that Fortnite is a high-quality product. The game is still in early access (i.e. it’s not a finished game), so there are some kinks here and there, but the Epic team is committed to the product and is visibly working hard to make sure the game is running smoothly and keeps players engaged. They have continued to add new weapons, equipment, locations, and other features to the game free of charge so one can continue to play and get the full experience without paying a cent. Fortnite brings in revenue is by selling cosmetics for players to personalize their in-game character, and a 10-week ‘Battle Pass’, essentially a subscription that gives players more challenges to complete and cosmetics to unlock during that period. The game looks good, feels good, and is free. It’s not a tough sell to get people to try, and once they do they are hooked. Below is an example of two of the latest in-game character skins that can be purchased.

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No pay-to-play advantage

While it’s hard to say how much the approach to in-game purchases contributes to Fortnite’s success, it is starkly different from how some major publishers approach in-game purchases. Electronic Arts has been successful with in-game purchases, especially with their FIFA games, but also faced vows-to-never-offer-paid-loot-boxes-in-its-controversial-star-wars-battlefront-ii-game.html">notable backlash from the way the in-game purchases for Star Wars: Battlefront II were setup. EA allowed players to spend money to unlock items that grant a competitive advantage over those who elect not to spend extra. Fornite takes a different approach, offering its 10-week Battle Pass and limited-time character skins, items, and emotes, which are completely cosmetic and provide no competitive advantage. Some of these items are only available for purchase in a 24-hour window before they disappear from the store, driving users to get the items they like while they can. Despite the game being released for free, and in-game purchases providing no competitive advantage, Fornite earned $126M in revenue in the month of February alone. Since then, Epic Games has launched Fornite Mobile, which has reportedly reached $1.8M in revenue per day. Needless to say, their unique in-game purchase strategy seems to be working.

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Disclaimer: We actively write about the themes in which we invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.