I Dream of 3D: Makerbot, IP, and the advance of Technology

There is an oddly fascinating documentary on Netflix about 3D Printers, Print the Legend. The story follows two startups–MakerBot and Formlabs–and three established companies–Stratasys, PrintForm and 3D Systems.

I don’t think we’re heading toward a micro-industrial revolution, a 3D printer in every backyard, but they have many interesting possibilities:

3D printing seems perfect for reasonably small, individually customized items like prosthetics, dentures, hearing aids, and shoe inserts. I can easily imagine a vending machine at the shoe store that takes an impression of your feet and then prints custom inserts while you wait–like the photo booth that prints silly pictures of you and your friends.

But let’s discuss possibilities later–today we’re discussing MakerBot, IP, and learning curve. MakerBot was founded in 2009 by Adam Mayer, Zach Smith, and Bre Pettis. The original MakerBot Printers were quite cute, with a DIY, home-hobbiest feel. (They were, in fact, DIY-kits you assembled yourself.) Later MakerBots, by contrast, look like digital ovens and come pre-assembled–aimed at the “professional consumer” market.

In its early days, MakerBot was a creativity-driven startup cobbling everything together in a warehouse where, as they put it, new employees even had to build their own chair when they arrived.

In those days, MakerBot attracted the sorts of hacker nerds who wanted to work in a startup warehouse, and adhered to hacker ethics: the hardware was open-source.

Open-Source hardware meant you could copy their design and build your own, or you could modify your MakerBot and share your innovations with the broader MakerBot community. With an enthusiastic community working together, it wasn’t long before user-created innovations were incorporated back into the MakerBot’s products.

MakerBot also launched Thingiverse, essentially the MakerBot Open-Source community’s home and database on the web.

As MakerBot moved from startup dream to reality, the culture changed. By mid-2011, they had sold about 3,500 bots. In late 2011, The Foundry Group (venture capitalists) invested $10 million and joined the company’s board. In 2012, Bre Pettis pushed out co-founder Zach Smith, (who wanted to remain true to their founding principles.) A month later, the company moved from its startup garage to a New York apartment office headquarters in the sky.

Bre Pettis fired about 100 people (they only had 125 employees when they moved) and hired far more. These new employees weren’t hacker nerds; they were the kinds of people who wanted to wear suits and work in an office.

A few months later, in a massively controversial move, MakerBot went closed-source.

By June of 2013, they had sold 22,000 printers, and competitor Stratasys Incorporated decided to eliminate them by buying them for $604 million. Good deal for Bre Pettis; shitty for Zach Smith and all of the folks in the MakerBot community whose Open Source hardware ideas eventually made Pettis rich.

In 2016, MakerBot/Stratasys moved their manufacturing plant from New York to China.

Did MakerBot do wrong by transitioning from Open to Closed source? Did they cheat the people who helped them grow, or did they make a wise economic decision?

The growth curve for new startups is initially quite flat:

This is actually the growth curve for yeast, but it’s the same for companies. In their first few years, companies experience little–even negative–growth. Only once they reach a particular size and level of competence do corporations enter a period of rapid growth (until, at maturity, they have captured as much of the market as they reasonably can.)

Much of the difficulty for a new company–especially a company that is building a new product–is informational. Where do I buy parts? Where do I buy 10,000 parts? Where can I hire workers? How do I withhold income taxes from paycheques? Where did I put the receipts for those 10,000 widgets I ordered? What do you mean you threw out all of the steel because it wasn’t good enough?

Solving problems and then routinizing those solutions–as Auerswald would put it, developing code–is critical to early growth. More employees means more knowledge and ideas, but employees cost money, and new companies don’t have a lot of money.

Here’s where Open-Source comes in: by expanding the number of people effectively working on the problem (at least on the hardware end), the open-source community greatly increased MakerBot’s effective company size without increasing costs. Free expertise=faster growth. The community also fostered growth by increasing demand for the bots themselves, as each person who contributed quality printing ideas to the Thingiverse databases increased the realm of ideas other makers and potential makers had to be inspired by.

Once the hardware designs were basically perfected, Open-Source could no longer contribute to hardware innovation, and became a liability, as people could simply download blueprints and make their own bots without paying any money to MakerBot. At this point, as MakerBot entered its rapid growth phase, moved to bigger offices and hired a ton of new employees, it abandoned open-source.

There is a very similar phenomenon in the world of writing, but the ethics are regarded very differently. Many aspiring novelists are members of writer’s clubs, critique groups, or fandoms where they post, share, read, and give feedback on each other’s work. This creative foment and mixing of ideas spurs innovation–as when fan works take on a life of their own nearly independent of the original–and refinement, as when a novel is finally polished and sent out to publishers.

In some cases, very popular writers initially built up followings by publishing in fandoms based around established books or movies before transferring that audience to their own, original works. 50 Shades of Gray, for example, started as Twilight fan-fiction before morphing into its own book.

In other words, in their initial, creative phases, many novels are essentially “open;” this allows the writer to draw on the knowledge and expertise of dozens of other writers. When the novel is good enough to consider publication, it becomes “closed;” a published novel costs money. (It is considered good manners, though, to offer a free copy of the novel a a thank-you gift to anyone who gave significant help along the way.)

This is the same open and closed process as MakerBot pursued, but since it is considered normal and completely expected in writing communities for people to take suggestions, incorporate them into their stories, and then try to pitch the stories to agents, no one looks askance at it. I myself have edited many novels, one of which is now an Actually Published Book by a Real Author. I don’t resent that the book I once read for free and offered feedback for now costs money; I’m just happy on behalf of the author and glad I could help.

By contrast, people were surprised by MakerBot’s pivot, even though it made sound business sense. Surprising people tends to piss them off.

Traditional IP is structured so that copyright/patent protection starts at the time of innovation and eventually runs out; it doesn’t really include an open or semi-open period after which the work becomes closed. In writing this is handled by a convention that so long as the entire novel is not openly posted on the internet or elsewhere, the author can still sell the rights to it. I don’t know how things work over in patents, but given the number of patent infringement lawsuits filed every year, attempting to share designs that you would later like to make closed sounds like a potential nightmare.

Nevertheless, I think something like this Open-Closed process would be beneficial for many new companies, especially as they struggle to grow, learn, and optimize. If it were expected, as in writers’ communities, then the pivot to closed-source wouldn’t be seen as a betrayal, but as a sign of success–a company that had made it big.

Spurring innovation doesn’t just help companies and their owners. We all benefit from better products. Amputees benefit from better, cheaper prosthesis. Sick people benefit from better, cheaper medicines. Poor people benefit from better, cheaper houses.

Just imagine three of these, joined together, located anywhere you want to live…

 

The Activation Energy of Economic Activity

Both Bourgois’s In Search of Respect: Selling Crack in El Bario and Joel Salatin’s Everything I Want to do is Illegal: War Stories from the Local Food Front discuss legal difficulties faced by small-scale entrepreneurs (albeit in very different situations.)

One of the crack dealers in Bourgois’s ethnography has amassed a small fortune (for the ghetto, at least,) and wants to “go honest.” So he uses his money to open a convenience store, but gets shut down by the authorities (state or local, I don’t recall which,) because his bathroom isn’t disabled-accessible. So he went back to selling crack.

Salatin also complains about ADA compliance, particularly in the matter of parking lots (if he pours a few concrete spaces in his yard so customers can park at his farm and buy a few chickens, does he need to make a handicapped spot?) and bathrooms.

Now that I think of it, back at one of my former jobs, we had a changing room that was officially a “supply closet” because it wasn’t large enough to meet ADA standards. (Obviously I was not in charge of this business and had no control over the closet.)

Salatin’s principle complains, though, focused on food-regulation laws–What counts as organic? What is an approved butchering facility? What if you are only butchering five chickens and want to sell them to your neighbors? What, exactly, is “organic”?

The amount of paperwork and legal compliance required to add a few organic potatoes or locally slaughtered chickens to such an operation are enormous.

According to Wikipedia:

In chemistry, activation energy is a term introduced in 1889 by the Swedish scientist Svante Arrhenius to describe the minimum energy which must be available to a chemical system with potential reactants to result in a chemical reaction.[1] Activation energy may also be defined as the minimum energy required to start a chemical reaction.

360px-activation_energy-svgSome chemical reactions basically happen instantly, like if you throw sodium into water (NOTE: Don’t throw sodium into water. It will explode.) Others, like starting a fire in your fireplace, require the input of some amount of energy to get the reaction going. (Typically we supply this energy by hand, by striking matches, rubbing sticks together, or striking flint on steel.)

We can also think of activation energy in economic terms as the inputs necessary to start a business. Beyond the obvious physical requirements–if you want to produce shoes, you will need material for making shoes–we also have legal requirements. You cannot simply bake a bunch of cookies at home, walk outside, and start selling them. There are some serious food safety laws on the subject.

Now to be clear, I value clean water, food, and medicines. I appreciate that my doctors are skilled. I don’t want to end up with brain-damage just because a local entrepreneur decided it was a good idea to dump old batteries into the drinking water, and I understand that disabled people need to pee just as much as everyone else.

But at the same time, we need to make sure we are not putting in so much regulation that small-scale entrepreneurs are effectively shut out of the market, because the costs of compliance either make the economic activity completely unprofitable, or are just too high for someone trying to start a business to bear.

(Large, already-established corporations, by contrast, tend to be less impacted by such regulations both because they hire armies of lobbyists to ensure that regulatory legislation favors them and also because their profits are high enough that they have money to spare for compliance. Still, they, too, are probably impacted in significant ways.)

Corporations and the Litigious Environment that is Destroying America

I’ve been thinking about whether we should quit creating various forms of corporations–like LLCs–for for the past 15 years or so–ever since Bakunin, more or less. But other than the fraud post a few days ago, I think the only other piece I’ve really written on the subject was a short explanation of my opposition to letting corporations have any kind of political rights (eg, donating to campaigns, freedom of speech,) on the grounds that they are non-human organisms (they are meta-human organisms,) and since I am a human and rather speciesist, I don’t want non-humans getting power.

The problem with discussing whether corporations should exist (or in what form, or if they are good or bad,) is that people are prone to status-quo fallacies where they forget that  corporations are just legal fictions and act instead as though they were real, physical objects or forces of nature created by the Will of God, like mountain ranges or entropy.

But a “corporation” is not so much a big building full of people, but a piece of paper in your filing cabinet. Modern corporate structures did not exist throughout most of humanity’s 200,000 year existence, and in fact only came to exist when governments passed laws that created them.

All that takes to change them is a new law. Unlike mountains, they only “exist” because a law (and pieces of paper tucked away in filing cabinets,) says they do. What man has made, man can unmake.

So let’s talk about lawsuits.

America is a litigious society. Extremely litigious. Probably the most litigious in the world. (We also incarcerate a higher % of our people than any other country, though on the bright side, we summarily execute far fewer.)

Sometimes I think Americans are the kinds of people who solve disputes by punching each other, but we’ve gotten it into heads that lawsuits are a kind of punching.

At any rate, fear of litigation and liability are ruining everything. If you don’t believe me, try setting up a roadside stand to sell some extra radishes from your garden or build a bridge over a creek on your own property. You have to pass a background check just to help out on your kid’s school field trip, and children aren’t allowed to ride their bikes in my neighborhood because, “if they got hit by a car, the HOA could get sued.” As farmer Joel Salatin put it, “Everything I Want to do is Illegal.” (All Joel wants to do is grow and sell food, but there are SO MANY REGULATIONS.)

100 years ago, the kind of litigation people are afraid of simply wouldn’t have happened. For example, as Stanford Mag recounts of campus violence around 1910:

Black eyes, bruises, and occasional bouts of unconsciousness didn’t seem to alarm the administration. … Farm life came with a brutish edge. Some freshmen slept in armed groups to ward off hazers, a state of affairs apparently enabled by the administration’s reluctance to meddle. “Persons fit to be in college are fit to look after their own affairs,” Stanford President David Star Jordan said.

Fast forward a century to MIT getting sued by the parents of a student who killed herself:

Elizabeth Shin (February 16, 1980 – April 14, 2000) was a Massachusetts Institute of Technology student who died from burns inflicted by a fire in her dormitory room. Her death led to a lawsuit against MIT and controversy as to whether MIT paid adequate attention to its students’ mental and emotional health, and whether MIT’s suicide rate was abnormally high.

… After the incident, MIT announced an upgrade of its student counseling programs, including more staff members and longer hours. However, the Shins claimed these measures were not enough and filed a $27.65 million lawsuit against MIT, administrators, campus police officers, and its mental health employees. …

On April 3, 2006, MIT announced that the case with the family of Elizabeth Shin had been settled before trial for an undisclosed amount.[7]

Universities, of course, do not want to get sued for millions of dollars and deal with the attendant bad publicity, but these days you can’t say “Boo” on campus without someone thinking it’s the administration’s job to protect the students from emotional distress.

All of this litigation has happened (among other reasons) because corporations are seen (by juries) as cash cows.

Let’s pause a moment to discuss exactly what an LLC is (besides a piece of paper.) What’s the difference between selling your extra radishes as yourself and selling your extra radishes as a corporation? If you are selling as yourself, and one of your radishes makes a customer ill and they sue you, then you can be held personally liable for their sickness and be forced to pay their $10 million medical bill yourself, driving you into bankruptcy and ruin. But if you are selling as a corporation, then your ill customer must sue the corporation. The corporation can be found liable and forced to cover the $10 million bill, but you, the owner, are not liable; your money (the income you’ve made over the years by selling radishes) is safe.

(There are some tax-related differences, as well, but we will skip over those for now.)

There are doubtless many other varieties of corporations, most of which I am not familiar because I am not a specialist in corporate law. The general principle of most, if not all corporations is that they exist independent of the people in them.

This is how Donald Trump’s businesses can have gone bankrupt umpteen times and he can still have billions of dollars.

But precisely because corporations are not people, and the people who own them are protected (supposedly) from harm, people are, I suspect more likely to sue them and juries are to award suits against them.

As a lawyer I spoke with put it, he was glad that his job only involved suing corporations, because “corporations aren’t people, so I’m not hurting anyone.”

Suppose MIT were just a guy named Mit who taught math and physics. If one of his students happened to commit suicide, would anyone sue him on the grounds that he didn’t do enough to stop her?

I doubt it. For starters, Mit wouldn’t even have millions of dollars to sue for.

When people get hurt, juries want to do something to help them. Sick people have bills that must get paid one way or another, after all. Corporations have plenty of money (or so people generally think,) but individuals don’t. A jury would hesitate to drive Mit into poverty, as that would harm him severely, but wouldn’t blink an eye at making MIT pay millions, as this hurts “no one” since MIT is not a person.

You might say that it is kind of like a war between human organisms and corporate organisms–humans try to profit off corporations, and corporations try to profit off humans. (Of course, I tend to favor humanity in this grand struggle.)

The big problem with this system is that even though corporations aren’t people, they are still composed of people. A corporation that does well can employ lots of people and make their lives better, but a corporation that gets sued into the gutter won’t be able to employ anyone at all. The more corporations have to fear getting sued, the more careful they have to be–which results in increased paperwork, record keeping, policies-on-everything, lack of individual discretion, etc., which in turn make corporations intolerable both for the people in them and the people in them.

So what can we do?

The obvious solution of letting corporations get away with anything probably isn’t a good idea, because corporations will eat people if eating people leads to higher profits. (And as a person, I am opposed to the eating of people.)

Under our current system, protection from liability lets owners get away with cheating already–take mining corporations, which are known for extracting the resources from an area, paying their owners handsomely, and then conveniently declaring bankruptcy just before costly environmental cleanup begins. Local communities are left to foot the bill (and deal with the health effects like lead poisoning and cancer.)

The solution, IMO, is individual responsibility wherever possible. Mining companies could not fob off their cleanup costs if the owners were held liable for the costs. A few owners losing everything and ending up penniless would quickly prompt the owners of other mining companies to be very careful about how they construct their waste water ponds.

People need to interact with and be responsible to other people.

 

Now that gay marriage is the law of the land, everyone wants to pretend they were in favor of it from the start

We have always been at war with Eurasia--I mean, supported gay marriage
CONFORM

Thus proving that we have always been at war with Eurasia, pretty much every company you can think of–including the President Himself (who I guess is technically not a company)–has jumped on the Yay Gay Marriage bandwagon.

For the record, I was pro-gay marriage before it was cool; I’m so hip and indie, my best friend was trans back in middle school.

Now a bunch of companies that never gave a shit about gay people are proclaiming how happy they are about the SCOTUS decision.

Of course, companies just want to make money. But there was a time when companies endeavored not to take political stances, not wishing to alienate potential customers. Suddenly seeing all the companies simultaneously adopt the same logo is, well, creepy. Even if I want to bomb the shit out of Eurasia and am happy to see the troops head out, doesn’t mean I want everyone to suddenly start pretending like we’ve always been at war with Eurasia.

Part of what’s going on is that gay marriage has been recast by the left as “not a political issue.” These companies don’t see themselves as taking a political stance, but a moral stance, or a just plain celebratory stance. Of course, it is a political issue.

To be honest, conformity bugs me. When I hear people agreeing with each other, I start trying to figure out why they’re wrong. (It’s probably a bad habit.) I hate being expected to act a certain way just because everyone else is or perform certain emotions just because it’s a holiday or something. (This probably contributes to my dislike of holidays.) Groupthink annoys me; the “tyranny of the status quo” makes me rage against my keyboard.

This level of unanimity in just about anything post V-Day is further evidence of the radical speed of horizontal meme-transmission due to modern mass media like the internet.

It was not so many years ago, you may recall, that states were busy passing anti-gay marriage bills or amendments en mass. Not in the bad old days of the 1950s or 80s, but in 2004-2008.

I remember a friend freaking out about the bans somewhere around 2005. I tried to reassure them that the bans were good news: no one ever put that much effort into trying to ban something that people had no interest in doing. That much effort could only mean the conservatives were terrified of gay marriage triumphing–after all, back in 1950, when gay marriage wasn’t even a thing people were talking about, no one was bothering to try to pass amendments on the subject. “You’ve already won,” I told my friend. They did not believe me, but here’s the win.

Unfortunately, there are dozens–perhaps thousands–of issues I consider higher priority than gay marriage, which directly affects only a small % of the population. I’d rather we stopped Global Warming or cured cancer or helped the homeless, reformed the tax code or balanced the budget or got jobs and wages up for ordinary Americans, streamlined the legal and criminal justice system or even just increased Americans’ understanding of basic science. But most of these are boring things; it’s way more fun to argue about gay marriage or tabloid stars’ sex changes than to try to figure out the best way to run the country.

 

Corporations are Meta-Organisms and so Should not be Allowed in Politics

Corporations should not have the same rights as people because corporations are meta-organisms and I don’t want to get out-competed by them.

The meta-organism is still an organism. The same laws of evolution apply to meta-organisms as to since-celled organisms. You are a meta-organism; you are composed of billions of cells, some of them h Sapiens cells, the majority of them not h Sapiens. Yes, numerically speaking, most of your cells are gut bacteria.

Your individual interests are not the same as your cells’. Your cells are just as well-off taking the CTV route and transforming into sexually-transmitted-cancers and infecting everyone they can as they are hanging out in your big toe, worried about getting sloughed off the next time you walk around barefoot. In a pinch, you’ll sacrifice your whole leg to save the rest of you–sucks for your leg, but good for you.

A beehive is a more obvious meta-organism. You probably already know all about bees, so I will attempt not to bore you by over-explaining. The queen bee lays the only eggs; worker bees, all female, spend their days flying miles back and forth to fetch nectar for the hive until their wings literally fall apart and they die.

The colony survives even if the majority of the workers die, say, in destroying an intruder.

The bee does what it has evolved to do, but I do not find such a fate personally attractive (despite my obvious affection for bees.) I do not want to be a bee; I want to be a person.

Corporations, like bee colonies, are meta-organisms. They are created, they live, they die. They attempt to get legislation passed in their favor. They will, if not controlled by some outside source, literally work their employees to death. Corporations do what is best for the corporation, or else what is best for the Queen Bee (management, CEOs.)

A world where corporations are given the same rights as people is a world where corporations change the political, social, and economic landscape to favor the continued existence of corporations, rather than the human beings who are supposed to benefit from them.