The transitional year

There is the impetus to look to the 2007-2009 period as a model of the last big set of new directions and effects from a big economic shock. Countless disruptive forces that turned major sectors upside down were born more or less during that time. We all know the off-hand examples – Twitter, Uber, Airbnb, Square, Bitcoin – and can think of many others, in other segments, or with comparable impact, or that sequentially followed the trend or evolved out of the new directions that were set.

There is the impetus to look to that early period and draw a parallel to the present time, anticipating the formation of new products, business models, investment themes, social norms, and so on. Healthcare, retail, travel, real estate, all come to mind, and the anticipation is probably correct. Or at least it’s possible enough to warrant serious attention.

With the benefit of hindsight, the forces that came up in that earlier time seem obvious now, but everything seems that way with hindsight. Though, what seems turns less obvious on scrutiny, and the debates ensue. For instance, it wasn’t only the economic shock that drove some new directions or that shaped the environment for these to take root. There was another big event, the introduction of a new mass market product and its underlying platform: the iPhone and the mobile app store that came with it.

This time around, there isn’t that, at least not yet, and the shock is much more universal, deeper, and with consequences that are therefore even more unknown without the benefit of hindsight. The post-virus environment is a general restart, which is to say, a startup in many ways, where the directional catalyst is not [yet, perhaps] a new technology but the possibility of new social norms, which may in turn have impact on geographical, economic, competitive, and financial risks and opportunities, escalated to the nth degree as a result.

It’s possible that many things will continue as before, it’s possible that many won’t. It’s possible that those that will are those we currently expect, but it’s also possible that those we don’t also will, or won’t. And the degrees of possibility are more evenly distributed than typical because behavior is multifaceted, let alone on a global scale.

The thing to watch, as we analyze and try to estimate the economics of it all, will be the coming months into year-end. At least that will provide some clues as the world transitions from 2019 to 2021, and a sense of reality develops from a sense of possibility.

WSJ