Hybridisation of Everything

Throughout the COVID-19 pandemic, the prevailing opinion from the tech community has been that the enforced changes in the way we work, learn and socialise will become permanent.

However, this view overlooks the desire of most of society for face-to-face interaction. One that we're far from addressing with video calls. Zoom fatigue is well understood by most of us after more than a year of working from home, and is an example of the considerable barriers to a 100% online economy.

Instead, we're more likely to experience an earlier-than-expected shift to a hybridised economy. The energy and capital expended by everyone in fighting and adjusting to the pandemic will still have long term effects, but these will be present in the form of hysteresis as we settle on post-pandemic norms.

As a result, many of the bets made by investors on 100% remote work/education/events will likely have to manage their expectations over the next decade.

Future of Work

100% remote working is perfect for an individual contributer, for example a software engineer, where they can capture almost all of the efficiency created by remote work. Similarly a sales development representative will likely have been able to qualify more leads and hit their quotas faster.

When it comes to closing the deal, an account exec will find the opposite. Once it's possible for in-person meetings to resume, they'll find that the increase in efficiency of having more calls is outweighed by the impact of sitting in the same room with a customer.

Employees looking to work their way up the company ladder will also be incentivised to return to the office. With video calls there are no opportunities for chance meetings and the pre- and post-meeting chat that allows you to build rapport with senior management.

Sales and politics, the core drivers of most business activity, will therefore drive a majority return to offices. However, it will be more flexible than in 2019.

Flexible Work

The hysteresis effect on work will be the flexibility that was once a luxury at startups and some corporates, will become the norm.

It's now expected that every white collar job will be flexible, both on location but also hours. Those that reject this will find it hard to compete for talent, even with outsized compensation, as few will be ready to give up the huge benefits that flexibility offer.

This trend should also level the playing field when it comes to making it easier to raise a family [...]

The effects on the infrastructure of work, urban office space for example, is still unclear. It's a fair assumption that many companies may choose to downsize their office space, or move from a centralised model to having satellite offices closer to where their employees live. Startups are already emerging to take advantage of the resulting inefficiencies in the office space market, and existing players are adapting their products.

Portfolio Careers

Once restricted to freelancers and non-executive directors, the concept of a portfolio career has come to prominence with the rise of the passion economy.

From Substack and Shopify to OnlyFans and Circle, there are now numerous software tools that make it simple to monetise without a full-time commitment.

This is an essential evolution of the wider economy as unskilled, full-time work becomes more difficult to obtain. The "side hustle" will become more common for those that fail to upskill, but will also be a choice for many who prefer the flexibility.

The end result of this trend is a hybridisation of skills that is more responsive to the changing needs of economy that blurs the lines between employment and entrepreneurship.

Future of Events

The events industry was obliterated by the pandemic, leading to the stratospheric rise of startups like Hopin, the fastest 🦄 ever, and Clubhouse. It's obvious that we'll return to in-person sporting events and concerts, but less clear what will happen to startup events and conferences.

Although these filled a void, online "business" events typically have the following issues:

• Speakers can speak at many events, quickly making most speaking line-ups equivalent to poorly produced TED talks.
• Engagement is low as many attendees just have the webinars on the background while they work.
• Algorithmic networking/matchmaking isn't worthwhile compared to the serendipity of an in-person conference, many attendees will just leave.

As a result, the size of the online events market is constrained as there will be few events where attendees are willing to pay for this experience. Yes, you can attract more interesting speakers and many more attendees, but one of the core reasons for these events to exist is missing. The end result is there's little need for the event organisers and aggregators will take over.

Once the best speakers realise this, they'll move to directly monetise. Why speak at an event when you can hold a premium talk on Clubhouse and keep 97% of the ticket sales.

Sales

The primary reason for most events and conferences existing, outside of the academic community, is for sales.

The temporary marketplaces created that are focused on a core activity (e.g. selling medical devices or startups looking for investors) are very efficient. For the cost of a conference ticket, flights and hotel a skilled salesperson can make many more warm connections than trolling LinkedIn or sending cold messages on Hopin. Similarly, buyers are able to gain a strong understanding of the offerings in the market in a couple of days.  

Holding the event or conference in an attractive location and having top notch speakers ensure that the event is well attended by buyers, and the latter helps justify the expense of attending in the first place.

Online events are woefully inefficient for this type of activity and although the return will be slower, in-person events will return in some capacity once pandemic restrictions are loosened.

Future of Education

Edtech has been one of the spiciest sectors for VC investment during the pandemic, and with good reason considering many schools and universities have been closed for months at a time.

This has forced teaching to move online, something that the majority of educational instituions weren't prepared for. This was a major tailwind for any edtechs helping deliver lesson plans online, although surprisingly many lessons were just delivered via MS Teams and Zoom.

This has led to soaring valuations of edtech startups as investors have bet on the future of education being online. The biggest successes so far have been around widening access to education, which makes sense in markets such as India (e.g. Byjus), but less so in economies where free access to pre-university education is widespread.

However, this ignores the key role that the social aspect of schools and universities plays in our development. Aside from pure learning, our educational institutions are also key for the social development of children and young adults. The experience of interacting with the rest of the student body online is soulless and online-only cohorts are likely to be less well developed from an EQ standpoint.

Unbundling of Education

The thinking goes that the pandemic has exposed the education sectors version of the allegory of the cave, where teaching can be delivered anywhere and the importance of brand (Oxbridge, Harvard, Stanford et al) is diminished.

In the UK, where universities have been closed since March 2020, the number of international students has increased despite the prospect of a hollow undergraduate experience. We can conclude that these brands are unlikely to be disrupted by platforms for the time being.

However, once we get past undergraduate education the opportunities are much larger.

Upskilling

One area that the pandemic has brought increased focus is the need for workers to be more flexible and those that can rapidly reskill or upgrade their skills are more likely to stay in work as conditions change.

White collar workers have largely been unaffected by the pandemic and asymmetric demand for blue collar workers quickly emerged. Workers in the leisure and entertainment industry were furloughed or laid-off, while supermarkets and eCommerce operators searched desperately for warehouse and delivery staff.

As penetration of digital technologies impact the job market, through efficiency or elimination of jobs, we will increasingly need the ability to rapidly retrain workers to meet demand.

This is where hybrid courses can be incredibly effective, with digital courses combined with practical and on-the-job training enabling advanced economies to up- and reskill their workforces quickly.

School and undergraduate experiences are likely to remain primarily offline due to the huge importance of social education which is largely impossible online—at least for the next few generations.

A Hybrid World

One positive from the pandemic has been the forced evolution in many industries in their approach to technology and the forced cultural experimentation around how we live, learn and work. However, the bets on the extreme of 100% WFH or 100% learn online are likely to be premature.

For the time being, the foundation of human society is based upon face-to-face interaction and removing this has serious effects on our collective mental health and productivity. This may change as more generations that have grown up online mature and the culture of the internet becomes more pervasive in our daily lives.