🌍 S3T Aug 23 - Love it or hate it $ change is coming

Welcome to S3T, the essential newsletter, podcast, and learning platform for change leaders.

S3T shares 21st century leadership skills set in the context of emerging tech and the evolving economy. This is an unusual combination of skills, not usually taught together, but critical for the global and local challenges we face today. 

Every week in the S3T newsletter and podcast we review the top developments and insights you need to stay ahead of the curve, build your ethics & leadership skills, and drive intentional beneficial innovation.

🎧 Listen to this episode on the S3T Podcast - Be sure to follow the S3T podcast so you never miss a show!

Highlights from this edition of S3T:

• 🌍 Calls for reform in global financial architecture are growing due to the unsustainable current system.
• 📊 BlackRock tracks the evolving future of finance as a key "mega force."
• 🏦 New digital currencies could transform the financial landscape, challenging traditional debt-based systems.
• 🧑‍🎓 College closures are increasing as more people question the value of higher education and student loans.
• 💼 Startup world is facing a "capital crunch" with a surge in bankruptcies and failures.
• 💰 Saudi Arabia is shifting investment interests away from the US, raising questions about the petro-dollar agreement.
• 🚀 Change leadership training is ideal for those looking to make a difference in their careers, especially if they feel something needs changing in their community or industry.

Understanding the evolving financial architecture of the world's economy

A rising chorus of voices - from different sectors of global finance - are either calling for, or anticipating significant change in the world's financial architecture. There is a strong sense that the clock is running out on the current architecture, which appears to be on an unsustainable course.

The messaging about change is coming from disparate sources that don't usually align on much:

• The evolving future of finance is one of the five "mega forces" that Black Rock tracks.
• Brookings provides this summary of the different calls for reform of the world's financial architecture.
• Carnegie Endowment with another look at GFAR (Global Financial Architecture Reform)
• This Levy Economics Institute deeper dive (PDF) looks at the evolving world economy through the lens of the lopsided impacts and costs to emerging economies.
• Dialogue Earth from a climate change and climate finance perspective - climate finance refers to the specific arrangements for coping with the impacts of climate change.

The Fault Line

New digital currencies and cryptocurrencies are cash-based rather than debt-based as noted this week by Russell Castagnaro of Bufficorn Ventures. This is an important point - and marks the reason why these new capabilities have the potential to transform the financial landscape: they can provide more stable, transparent and cost efficient alternative to traditional debt based finance instruments, which function like a giant apparatus of IOUs.

Some will love this and some will hate it: the inherent IOU structure of the world's current financial architecture creates opportunities for the entrenched players to enrich themselves while locking other players into marginalized debt-plagued status. Anything that threatens the self-enrichment status quo is going to catch the attention and ire of the incumbents.

Startling rise in college closures

College closures are way up as more and more question the value of college. The price is more than the return in wages. Only 22% believe school loans are worth it.

Even tech services are leaning into the trend with alternative education and upskilling advice like this example for talent managers.

Macro Finance: Hangover, Extinction, Crunch whatever you call it, it happened

Back in Jan 2023, I shared an outlook on the "capital crunch" as the era of easy money began to close. Around the same time Tom Loverro's predicted a "mass extinction event" coming to the startup world:

While some tried to downplay the issue (Guardian: "No startups are not facing a mass extinction event"), the last 18 months have been tough (see this Dec 2023 eulogy) and new emerging data shows the devastating results:

• Startup bankruptcies were 7x higher in Q1 2024
• Startup failures surged 60% in the past year

FT also covered the issue from the perspective of the "hangover" from the boom years.

The capital crunch is continuing with the Saudis now refocusing their investment interests closer to home - after a previous reputation as a source for easy money.
Saudis are trying to increase their non-US partnerships in today's multi-polar world. While rumors of an "expired petro-dollar agreement" are likely overblown, Saudi Arabia definitely seems to be drifting away from the US and the dollar.

The next generation of online advertising: Perplexity takes the leap.

Perplexity - one of the more popular Gen AI chat agents known for research friendly functionality - says it plans to start running ads in Q4, hoping to catch the AI search wave. tecChatPDF has been running ads for some time now. Across the US, most companies now cite AI as a risk.

Blockchain unicorn for Intellectual Property protection

Story, a blockchain startup raised 80M with a 2.25B valuation based on a strategy to empower IP creators and holders prove their ownership, and protect from IP theft. This kind of solution also appears to be one of the best options for distinguishing content from a known creator vs content from a non-human creator, or malicious actor wishing to conceal the true source of an instance of content.

Politics & Tech

As the Democratic National Convention unfolds this week, political campaigns are steering clear of AI solutions reports the NYT. That hasn't stopped some of the - ok one of the - candidates from using AI generated deep fakes.

Organizations intent on diversifying tech are struggling amid Silicon Valley's rightward shift, and DEI-bashing fad.

AI & Nature

The Earth Species Project is using AI to better understand non-human communication - hoping to translate animal sounds and movements into language we can understand.

Change Leadership: How do I know that Change Leadership Learning Track is right for me?

S3T is all about equipping people for the change leadership era, by helping people learn the change leadership skillset.

I see three types of people benefitting from the change leadership skillset:

1. People just starting their careers, looking for ways to differentiate themselves and have an impact.
2. People established in their careers but seeing unfortunate things in their companies or industries that they’d like to change. They don't want to perpetuate the status quo, and are trying to understand how they can drive change in their regulated industry.
3. People fully dedicated to change leadership - they are very clear about the change that is needed - and they want to continue sharpening their effectiveness and learn with a likeminded community of change leaders.

That said, I also see people who are hesitant and unsure. If that's you, then what I want to share here today is just for you:

If you are feeling hesitant about signing up for change leadership training, here is why that’s perfectly normal and why you can take your time to see what’s right for you.

Maybe you're thinking, "Why should I take on something new when I'm already juggling so much just to keep up with my current responsibilities?" That's a completely valid concern.

But let me ask you this: Have you ever had that feeling that there should be more to your work than just completing tasks day in and day out? Do you ever see things in your job—whether it's a flawed process, a product issue, or even something bigger within your company—that just don't sit right with you? If you find yourself wishing you could make a difference, that’s a sign that you’re ready for this journey.

Change leadership isn’t about having all the answers from the start; it's about learning to see those opportunities for improvement and knowing how to rally others around those changes. If you're already noticing things that you wish were different, that’s the first step. It shows that you’re ready to grow into a leader who can help make those changes happen.

However, if you’re at a place where you’re content with how things are and don’t feel the need to take on more responsibility, that’s okay too. This training might not be the right fit for you right now. But keep in mind that someday you might start seeing things that you'd like to change—and when that time comes, this training could be exactly what you need.

Remember, it’s not about being ready from the get-go; it’s about being willing to start the journey when you feel that pull to make a difference. And if you’re feeling that now, you’re more ready than you think.

If you're ready to start, you can start now, by signing up for S3T Full Access, which gives you access to all of the learning resources on the S3T Platform, including the Change Leadership Learning Series, which takes you on a step by step journey from defining and understanding Change Leadership, developing skills and applying them successfully to the challenging situations you and your team face.

Opinions expressed are those of the individuals and do not reflect the official positions of companies or organizations those individuals may be affiliated with. Not financial, investment or legal advice. Authors or guests may hold assets discussed.