Running a mutual fund and being in the investment world for more than 20 years got me in the habit of looking to the future and observing the changes that were coming, and what they would mean for new opportunities. This was necessary to look at where to place money for the prospect of generating above-average returns. It also appealed to my entrepreneurial side of filling a gap that existed because of the opportunities that I was seeing. I would sometimes go into overload, thinking about all the things that could be done to take advantage of potential opportunities.

Changes in demographics, technology, and political and social trends have a major impact on what happens next and how we proceed to get there. Check out this video that was sent to me by my EO friend, Connor Neill, in Barcelona, Spain, called The New Middle Class Revolution: Facts and Figures.

Here are some of the interesting demographics and stats to note from the video. For instance, you are in the middle class if you earn $10 to $100 a day. The middle class will grow from 1.8 billion people in 2009, to 3.2 billion by 2020, and another 4.9 billion in 2030! Think about how staggering that is for a second. That is 1.4 billion people in a decade moving to middle class, to have a better life, and to have extra money to spend in the process. What are they going to spend it on? I hope they will buy your product or service.

China will become the largest market for automobiles, tourism, and online consumerism. India’s airports estimate 150 million travelers in 2013, and a projected 450 million by 2020. I have been in at least seven of them, and they are all under construction to be massive. The India middle class is projected to be 200 million in 2020, and 475 million in 2030, making up the world’s largest middle class. This type of growth is also happening in Africa and Latin American, so it is going on everywhere, except in extreme, communist-type economies, like that of North Korea.

This is what capitalism does for people – it creates opportunity for exchange, pulling people up from poverty to higher living standards and to better lives! Who does not want that for our fellow human beings? It is sad that there are those that want to stifle this by pushing some sort of socialist equality on people. I have seen what government-run equality means to people in India, and that is the large majority are equally poor and pathetic. Now, with a more capitalist approach, tens of millions are moving to the middle class. I have seen the changes with my own team over there in the past nine years.

Looking at these trends, how are you going to put your business in the path of this growth opportunity of so many millions and billions who will soon have extra money to spend? We all have seen the explosion in mobile. All the mobile apps out there give us ease in our lives, in one way or another. That is what I am doing to put myself in the path – building mobile apps. Think of a billion more people with smart phones in the next decade. Does the prospect of them having your mobile app present a growth opportunity for you?

When we look at the world, a lot of times we miss the aspect of context on how we look at things. This has importance in making business decisions of all sizes and shapes. This can show up a lot with people’s decisions and with how they look at their competitors and strategies.

I was reminded of this on reading Rasmus Arkersen’s recent post of the power of contextual intelligence. I have written about Rasmus before and his work continues to intrigue me. I first met him when he spoke at an EO regional conference in Bangalore, India, a few years ago. I wrote a blog about his work on human potential.

This recent discussion was on how Rasmus asked people which would be better to hire – an Apple or Microsoft sales person. He experienced most people would say Apple, because of all the hype on the products and Steve Jobs. But what if it was all that hype that made it easy for the Apple guy to sell more when the level of sales was not as high as Microsoft, but was due to a much better sales ability? This is the contextual intelligence that Rasmus is talking about when he says to look deeper and below the surface to learn how the numbers are achieved.

Anthony Robbins also talks about this in his discussions around metaprograms. He states that by understanding how people sort things, you can communicate better with them in the right context. According to Robbins, some people sort primarily by feelings or logical thoughts. Most of us know that, but did you know that some people can even sort by food? When their thoughts are focused around food, you may ask them directions, only for them to tell you to go down to the McDonald’s and turn there. Robbins says, “If you ask them about the movies, they will talk about the concessions stand. If you ask them about the wedding, they will discuss the cake.”

I also experienced this in my Investment days in what is called “survivorship bias.” This occurs when you look at performance over, let’s say, a group of mutual funds during an imaginable 20 years, and it looks good at an 8% return. What it doesn’t factor in are the funds that performed badly and were closed down or merged out of existence. If you added this in over that time period, you may have a percent or two lower rate of all those funds.

These all are examples of looking at the full context of a situation and getting a complete understanding of why something is what it is. This is what Rasmus says is contextual intelligence, and when all is fully factored, may help you make better decisions.

What type of decisions do you have ahead that may need a little contextual intelligence?

Mary Meeker recently released her annual overview of internet trends, and I found it to be very insightful. You may remember that I have discussed Mary’s research and opinions on this topic in some of my previous blogs. She pushed forward as a leader in this space with different investment banking firms and is now a partner at one of the most prestigious venture capital firms, Kleiner Perkins.

Meeker’s overview includes more than one-hundred slides, so I have summarized some of what jumped out at me. The general theme is that internet growth is still significant and mobile adoption is still in the early stages. Many of the slides show examples of how this connected world is creating the Re-Imagination of everything.

The Smartphone has penetrated only 953 million users when compared to the 6.1 billion mobile phone subscriptions as shown on slide 11. This is a huge upside. Think about all the new businesses and people considering apps moving forward. Is your business prepared to benefit from this growth?

Next, on slide 10, compare the global penetration between the Android and iPhone shipments. Android has over 250 million compared to over 60 million with the iPhone. This is a four times difference, and it makes you think about for which one you would build an app. Looking at your demographic, area, and global reach will help to determine if you choose to create an app for one or both.

Slide 18 shows India’s usage of the internet on a desktop has decreased over time, and their usage of internet on mobile devices has increased over the period 12/08 to 5/12. Mobile usage has currently surpassed that of desktops, which should be considered for the monetization of sites. Most sites make more money from ads on the desktop than on mobile. This will changes things.

Mary also makes several points about how things are changing in the world with the internet. In 2010, after 305 years, newspaper ad revenue was surpassed by internet (slide 32). The trend lines for the newspaper ad revenue were declining much faster than the internet was sloping up.

From a technology investment perspective, be careful. Look at slide 108. Out of the 1,720 IPOs over the periods 1980 and 2002, only 2% of these companies accounted for 100% of net wealth creation.

Mary states that the “Magnitude of upcoming change will be stunning. We are still in spring training.” She gives a long list of reasons in slide 85. A few key elements include nearly ubiquitous high speed wireless access in developed countries, fearless and connected entrepreneurs, and inexpensive devices and services, including apps.

How are you benefiting from these major trends taking place right before our eyes?

In business we refer to a sandbox as the area in which you play or conduct business. It consists of three things: your geographical boundaries, your products or services, and either your client description if you sell direct or your distribution channel if you sell there.

When determining your sandbox, one area of thought is to make sure that the sandbox you are playing in is capable of getting you to the goals you have created for yourself. Problems could include not having enough customers or not having the right customers in your geographical boundaries. The product or service may have saturated the market you’re in, and the client description could have changed or expanded.

In our situation, we found that to reach our goals we need to add a geographical boundary that is larger and more diverse than our existing one in Knoxville, TN. We have the opportunity to open another office in a market that provides this, and we feel this will open the sandbox for us to get where we want to go.

April Cox, my partner and co-founder of Efficience, will be going to Dubai in the beginning of June to start our new office in that fast growing and dynamic city. April has contacts there from her husband and EO members that we have met over the years, so she will be off and running to network and increase our reach in our new expanded sandbox.

Not only will she be in fast growing market, it is also a modern city adapting to the latest technologies. This will be a plus for us at Efficience because we believe there is a better way to leverage technology and growing in a new environment with other companies that believe this also will be mutually beneficial. It takes four hours by plane to get to our office in India from Dubai, so working with our team there will be more “local” for the companies we connect with as we work together.

We are excited for this expansion and the chance to open the door to new relationships, customers, and product opportunities.

Is your sand box big enough to get you where you want to go?

Think about that!  If you had access to 4 billion customers, how would that impact your marketing, your strategy, your vision, your opportunities, and your profit potential?  Well it’s coming, and I see it happening right before my eyes.

Let me back up for a moment and give you some perspective.  As I write this, I am at my office in Pondicherry, India.  I started Efficience with my partners April and Rich back in 2004 and came to India shortly after to set up the office.  We started with one full time team member and one intern and then quickly added five more.  We have now grown to 40 bright, enthusiastic, hardworking men and women.   

When I started coming to India, none of the team members had cell phones.  Cell service existed here, but the phones were expensive, and most didn’t see the value in having one. This continued for a few years.  Now all our team members, from the lowest to the highest paid, have cell phones.  At this point, eight of them have smartphones, and I see the rest upgrading in a year or so.  I can see this new global customer base growing right before my eyes.

You may remember reading the Software Monster blog I wrote about how new software applications, Software as a Service (SaaS) tools, and apps are eating up the legacy business of a huge number of mainstream industries.  This was based on an article that Marc Andreessen, founder of Netscape, wrote in the Wall Street Journal.  Now, he has another article out that deals with the expansive opportunity that putting a handheld computer or communication tool connected to the entire world is offering by bringing customers to your doorstep.

In a CNet article called Marc Andreessen Predications for 2012, Marc discusses how smartphones are now in the hands of about 2 billion people in the developed world, and in three to five years they will be in the hands of 6 billion.  Can you imagine what to do with 4 BILLION New Customers?  I have been advocating the power of connectivity since the early ‘90s, and this adds an exponential growth factor to that, which compounds the potential.  If you read any futurist thinkers like Ray Kurzweil, it looks like we are much closer to that Singularity moment.  You can check out his book here.

Marc ends the article with how opportunities and growth wrap around smartphones saying, “Local merchants, like local restaurant owners, are going to have a smartphone app they can use to dial up customers on demand. Whether that’s from Groupon or Foursquare — any of these companies can do that. A lot of small business owners are going to start running their businesses from their smartphones.”

Your marketplace is not your backyard anymore; it’s not even your country.  We recently launched a requirements gathering tool called Sluice, and it gets 60% of its sign-ups from outside the US.  I can already envision all kinds of great opportunities with this mobile expansion, and we are moving our company in that direction for the potential it offers.  What are you doing to go after the soon-to-be total of 6 billion new customers?

Pondicherry, India, where he was asking my advice on making decisions. More specifically, he wanted to know how much information he needed to hold out for before making a decision. It occurred to me that many of us struggle with the same question. How long does one wait and continue to collect information before making a decision, without worry that it is wrong?