Welcome to the Future

My name is Christopher Lyrhem and I’m the new Chief Future Officer at Sircular, a Swedish company whose mission it is to empower investors with AI.

The title of this newly created research letter represents our flagship research product, that will be openly distributed and explore how disruptive innovations could transform our global society in profound ways.

The purpose of Welcome to the Future will be to give investors, and other curious people from all walks of life, spicy distillations of future scenarios that could transpire in the next few years or decades. It’s also an early inception of our upcoming and unique streaming research product, called The Future.

After more than 16 years within the field of research, in various positions such as equity research, portfolio management, and future & strategy analyst – I felt that I was ready for a new chapter in my career. A different type of chapter where the long-term mission is to build a new type of animal in the research and investment marketplace.

Sircular is a young company developing original AI-based solutions for venture capital investors, but with the end-game mission of serving all types of investors.

Firstly, by providing investors with their very own Copilot, that analyses and structure their investment opportunities, Sircular is currently nearing scalable product-market fit.

Secondly and in development, is the Second Brain, a sophisticated knowledge graph- and AI-based solution allowing for anyone to “duplicate” their brains and effectively become the Mother brain of the investment firm.

And thirdly, Sircular will also develop another complementary product – The Future. This product will give investors access to thousands of future scenarios, for all industries and their subsegments, to subscribe and customize their research output. Investors will choose their focus areas and get exactly the research output they want, tailored for their preference. One could call such product a “Netflix for research” and one of the first streaming services in this space.

In this newsletter, we will explore many of the future scenarios that The Future will provide.

So, again, welcome to the future.

Now, let’s briefly go through some of the future scenarios that I for one believe could materialize going forward.

Autonomous mobility is currently going exponential

First up is the scenario of autonomous vehicles going exponential in the near future and completely redrawing the mobility landscape. After having almost an unhealthy obsession in following what’s happening in the personal car space for the better part of the past decade, and how industries usually transform when new radical disruptive innovation come online, it is abundantly clear to me that autonomous mobility (self-driving in other words) – holds the potential of flipping most of the past truths (for this heavily conservative industry) on their very heads.

Over the past 10 years, we’ve witnessed a handful of technology companies (such as Waymo, Tesla, and Zoox) driving a massive investment wave into making the car autonomous, and the current state of this technology is that it is now a factual reality – not a future scenario. We now have actual commercial autonomous mobility services in both the US and in China – delivering hundreds of thousands of passengers every single week.

Tesla is the heavy gorilla in the AV space (with AV standing for autonomous vehicles), not only in the EV space. It is a vertically integrated manufacturing/technology company that have sold millions of cars that soon will be able to be upgraded to be autonomous. The story of Tesla has mostly been about a novel company creating novel factories, that makes novel cars with a novel electric engine. But the future story, and the large majority of the market cap of the company – is autonomy. Be so sure.

So, what happens when the car can drive itself? A lot will happen. I believe that the economic and cultural effects could be bigger than the shift from horses to the car more than a 100 years ago. Now, you might think I’m crazy by believing this but do consider that the shift from horses to cars didn’t really change the business model or distribution of the primary transport mode for people. Yes, it was muscles instead of a internal combustion engine and a completely different product. Of course. However, you still had to purchase it, store it somewhere, give it fuel, insure it, take good care of it, and so on.

With autonomous mobility, people that do not wish to own a car won’t be forced to do so anymore. It’ll be a choice for every single individual, and according to several consumer surveys out there – a meaningful share of consumers (more than half potentially) could opt to not own a car in the future. People will simply subscribe to autonomous mobility services and “stream” the product utility, instead of having to own it and deal with the messiness of owning it.

And if cars are subscribed to in 10-15 years from now, to let’s say 20% of all miles driven, there will be massive repercussions for the industry as a whole – all the way from the makers of the car to the maintenance of it. We might not need as many parking spaces as today, or dealerships, or insurance companies, or other types of middlemen currently present in the marketplace.

Autonomy is massively underestimated

What autonomy also could unleash is an economically sound sharing economy. Because when a car can automatically match someone who wants to sell something physical, with another someone who wants to buy this something, and perform a mobility service much cheaper and faster than when a human driver performs it – it creates a network of “next mile” mobility nodes.

Any car, anywhere, at any time, will be able to be part of a fully functioning sharing economy – that could be an order of magnitude bigger than today. Currently, the sharing economy is a miniscule part of the commerce landscape – but with autonomous mobility, the sharing economy will go viral.

If you haven’t seen autonomous vehicles ride around a city yet, I suggest you either go to California or onto Youtube and search for Waymo, Tesla, or Zoox – and I bet you’ll get as mesmerized as I do (check out the video below).

Autonomous mobility is a massively underestimated topic and prospective market, because when the car can drive itself, it means that anyone will have the opportunity to buy a car (or multiple) and effectively become a mobility provider by renting it out when not riding in it.

Anybody could become a mobility provider and as such, the car will go from being an undisputable product consumable, into a revenue-generating asset. Now, this will surely require the car to be made with longer-lasting lifespans and likely a high dose of renewability – but I’ll bet my money that this will be a globally scaled reality.

Retail stores on wheels

And furthermore, if private individuals can become mobility providers of both people and physical products, it also means that retailers will be able to do so as well. Imagine 7-Elevens, Apple stores, or H&M-stores, all becoming mobile retail stores on wheels. Instead of people going to the store (which comprise 70-80% of overall commerce), the store will come to us.

Now, when I entered the field of research some 16 years ago, a lot of conservative investors and people in general, were quite reluctant to believe in a future where e-commerce platforms would take the physical retail store landscape by storm. They believed that people (probably focusing on themselves more than on objective surveys of thousands of consumers) will always like to physically see and feel a product in their hands before they purchase an item. This was a flawed thesis and strategy, that unfortunately many physical store owners, and franchisers, had in common.

My thesis for the future is that the way we consume physical products will once again go through a substantial disruption – similar to how e-commerce disrupted our consumption lives and adjacent value chains.

For one, we won’t go to the store to buy groceries and daily products, or even discretionary items like clothes or electronics – because the stores will come to us. We’ll summon an autonomous store to the corner of our street, and we’ll be able to enter this mobile store and check out the products within. In isolation (meaning a person entering a store and checking out products), this is really nothing particularly special. But the logistics of it is extremely special.

Now, remember I said that autonomous mobility is a massively underestimated topic and prospective market? What I mean with this statement is that both the global interest and marketplace value of light-weight vehicles in general, could enter a substantial boom-phase in the next 20 years. This is due to several reasons.

Firstly, the car will get democratized as it becomes a much cheaper service than the reality today, which will unlock a billion people (or more) to enter cars on a daily basis. This is a structural growth potential, in other words.

And then secondly, the car will unlock a sharing economy on a global scale for the first time in history – which in turn could ignite a new economic incentive to support a shift from linearity to circularity in general (but more on that later).

And thirdly, autonomous mobility could morph single-utility vehicles into being multi-utility vehicles. With this I mean that vehicle in general, could become the stores of the future. This will make vehicles much more valuable than they are today.

Now, autonomous vehicles changing the game of mobility is far from the only incredibly interesting and explosive future scenario out there. But it’s one of the most consequential and one that could lead to both massive investment opportunities and risks. Autonomy will redraw the marketplace completely and potentially decimate traditional value chain market actors, and even recalibrate the way we make, move, and consume physical products.

General-purpose robots to disrupt manufacturing

Another intriguing future scenario is that of general-purpose robots coming into our buildings and streets and performing most (or all) of the tasks that humans do today. I’m talking about humanoid robots, and other shapes, that will take care of the mundane stuff in our lives while we focus on the exceptional things instead.

There are now more than 30 serious manufacturers of humanoid robots globally that are developing improved functionality in warp speeds. Figure, Boston Dynamics, Tesla, and Unitree Robotics, are some of these.

Quite soon, these general-purpose robots will enter our homes, stores, and factories – and potentially disrupt hundreds of traditional product categories. Because when a humanoid robot seamlessly can switch limbs and do whatever you want it to do, why buy physical products that only can perform a utility in one single product category? It’ll make much more sense to buy a robot that will take care of all the “jobs to be done” in your home, store, or factory.

Imagine robot switching limbs and being able to vacuum, mow the lawn, cut cables, sort components, and even paint your walls. Such general-purpose product could potentially disrupt a lot of things. Especially as new manufacturing startups only would have to produce the endpoint of a physical application, without needing to make the engine that powers it. A humanoid robot could become sort of like an iPhone, a platform, for application manufacturing companies.

Furthermore, when general-purpose robots are fully autonomous able to do many of the tasks humans can today – it could potentially break the cost-arbitrage that low-wage countries have on high-wage countries.

And when autonomous vehicles enable the sharing economy, and a shift from ownership to usership in the physical world (meaning subscribing to cars and other products, instead of owning them) – it will make a lot more economic sense to build new factories close to the point of consumption. Close to the end-users. This is called reshoring manufacturing. Reshoring back to where factories once were, after 50-70 years of continuing offshoring.

In my view, autonomous vehicles, general-purpose robots, and soon a plethora of renewable materials – will enable usership as the most suitable manufacturing business model. And when usership becomes the go-to business model, the incentive is to design products so that the last longer, and that they are able to be remade to the original version of itself.

Today, the incentive is to spin as many products as possible, in the least amount of time, and also make them so that they won’t last forever. Preferably as short as possible so that customers come back more often.

This incentive governs the global manufacturing world and is a foundational reason for continually increasing levels of carbon emissions. People are driven by incentives and will not change as long as a linear manufacturing incentive prevails. But with autonomous vehicles, general-purpose robots, and (AI-generated) renewable materials – we have the chance to replace the current linear economic incentive with a circular incentive instead.

Conclusions

So, ultimately, what I’m saying here is that the embedding of AI into our physical society holds the potential of changing the core manufacturing incentive that governs our global economy. In my view, AI is a massive topic for reshoring and circularity, which goes hand in hand because we need factories to be close to its’ customers, in order to enable circularity.

Now, let’s land this first version of Welcome to the Future, which by the way will not be a newsletter, others do that better. Instead, it’ll be a relatively long-form thought-provoking research letter that every week will dissect one or more long-term future scenarios, for a wide array of sectors. It’ll explore potential impacts from these scenarios, with prospective investments in mind, and even highlight relevant startup companies.

So, if you’re intrigued by our mission with this research letter, do not forget to subscribe here on LinkedIn, and on Spotify where you can listen to it.

Thank you for your attention.

Welcome to the Future.

All the best,

Christopher Lyrhem

Chief Future Officer at Sircular