Saturday, July 6, 2013

Why We Need Driverless Cars Now

There's a short answer and a long explanation.  The short answer is this:

Humans are REALLY BAD at driving cars!  They should stop and let machines do it.

Around 1.2 Million humans die every year on this planet as a result of being in or around an automobile.  Allowing humans to take control of high-speed land vehicles is clearly insane. Expecting them to somehow not end up slaughtering each other is criminally naive.

Human drivers are also responsible for the congestion on our urban streets and freeways.  How?  Because they almost never do the thing they should do when they should do it.  Large amounts of road-space-time get wasted and irretrievably lost forever by slack, sloppy driving habits.  Slow-downs and back-ups are almost entirely the cumulative fault of every driver that delays acceleration until it's too late to make any difference, and delays braking until its too late to avoid a complete stop.

Human drivers also make intersections with traffic lights necessary because they are incapable of following any more efficient and intelligent kind of rule, for example ones that do not result in huge delays and backups.

But isn't that just life?  Isn't traffic congestion and people getting murdered in car wrecks just a part of being urban in the Age of the Automobile?  Not necessarily.  I'd like to challenge that assumption and suggest that there is a better way, and one that doesn't necessarily involve massive road widening and overpass construction projects.  Although, those things would definitely help and will eventually be needed.  Might as well start building now 'cause it ain't going to be any cheaper in the future.

And public transportation is never going to replace the car.  The bus or the train doesn't go to all the places people need to go: drop off the kids at a school, swing by a supplier's premises on the way to work, hop over to a meeting before lunch, check in on a vendor in the afternoon, pick up the kids, pick up 150 lbs of groceries (try doing even that ONE thing on the goddamn bus!) and make it home some time that very same MONTH!  No, screw public transportation.  It has its place, and that place is limited.

However, there is a completely different traffic paradigm I'd like you to consider. The genuine possibility of completely driverless automobiles.

What could that mean for the future of urban personal transport?

Zero Accidents
Driving machines would have far greater situational awareness, more information about the cars, obstacles and hazards in its periphery, vastly superior reaction times, zero distractions or emotional impulses, and no difficulty whatsoever following very detailed traffic control instructions.  For example, "proceed at 44.32 mph and merge 7 inches behind the vehicle designated 4F56 and then accelerate within 0.7 sec to 44.34 mph."

Zero Intersections
At least not as we know them, with traffic lights and massive backups in every direction.  Two major thoroughfares that intersect, if the volume is high enough, warrant an overpass with full 4-way cloverleaf interchanges.  Driverless cars can negotiate narrower and tighter merge ramps, therefore future cloverleaf interchanges could be built in less space.  Intersecting medium to light volume thoroughfares can do so using a "roundabout" at which there is never any need to stop at any time.  As long as cars are driving and not humans.

How would this work?  The same way roundabouts are used today by drivers who know the trick.  If there is any visibility (MANDATORY!  Are you reading this, traffic engineers?) then you watch not the other cars but the gaps between them.  Time your approach to hit the gap and slide right through.  Only, this doesn't work when the approaching cars are not leaving an adequate gap between them.  Driverless cars would know better.  By leaving the gap and allowing traffic to shoot through (think of the "figure eight" trick by groups of ice skaters), the result is everyone moves through the roundabout at pace and there is no need to tailgate in the vain hope that that will move things along faster.  There will also be no slowpokes clogging up our streets with their goddamn temerity and incompetence.

No "Residual Slowing"
This refers to the phenomena of an accident on a freeway in the morning resulting in a slowdown with no apparent cause remaining at that location the rest of the day (as long as traffic volume remains above a certain threshold).  It only clears once traffic becomes so light that the backup, actually a form of compressible standing shock-wave, vanishes for lack of cars. Driverless cars would be capable of clearing a backup almost instantly because an entire line of cars miles long would be capable of accelerating as one and quickly resuming normal freeway speed.  Each stupid human driver delays a couple of seconds after the car ahead of them moves off, thus ensuring that the backup will remain on that stretch of road all day long.

-   *   -   *   -

The transition to driverless cars is already happening.  There are cars on the road today that can virtually drive themselves using collision avoidance technology, safe-following-distance mode cruise control, "lane control" technology and sat-nav.

Finally, a critical number of properly-equipped cars on the road creates the opportunity for cars approaching any intersection to form a kind of ad-hoc "traffic control" network in which they collectively decide on the best way for approaching vehicles to negotiate the intersection.  "Distributed Processing And Control" is already a thing in Computer Science.  That means the traffic lights can be simply switched off for good.

The final stage will require, sadly, the outlawing of one of the most pleasurable things I know: Taking the wheel of a car and driving it.

But that would hopefully apply only in urban areas, where driving is actually kind of a pain in the ass to be perfectly honest.   As long as I could leave the city and enjoy a good hard drive on an open road once in a while, I don't think I'd miss city driving.

Monday, July 1, 2013

License to Print Money

There are unprecedented levels of renewable energy feeding into the electricity grids today from wind, solar PV, ocean wave/tidal, and others.  But it's not all good news.

Imagine if you will an electricity network with a solid baseload (24/7) supply such as a large coal plant or a nuclear plant, coupled with a large wind farm nearby.  In a situation where there is a coincidence between low demand and strong supply, for example at night when the wind is blowing,  then something unusual happens.

If the wind farm produces more electricity than is required, the baseload plant may have to shut down.  But shutting down a large plant is really expensive.  It isn't a simple process, it increases wear and maintenance costs, and re-starting it takes hours and sometimes days which can result in critical electricity shortages.  The operators of a baseload plant will do almost anything to avoid an unnecessary shut down - start up cycle.

In fact, they would happily pay people to use more electricity so they won't have to shut down, which would cost them even more.  Basically, in that situation the instantaneous spot price of electricity becomes negative.  Someone will literally PAY you to take it.

How can that be, you ask?  How can perfectly good electricity ever be worth less than zero?  Well, consider the analogy of music.  Most people happily pay for the music that they really enjoy.  But if someone were playing your favorite music loudly outside your house while you were trying to sleep, you'd try to get them to stop, wouldn't you?  Would you go so far as to PAY them to go away and come back at a more appropriate time?

Renewable energy is like that.  Sometimes there's a lot of it around when it isn't needed or wanted.  Sometimes the winds blow at inappropriate times from a power demand point of view.

Imagine though, if you could accommodate the plant operators in their dilemma. Suppose you agreed to take all the excess electricity they had if they paid you, say, 1 cent per kW-h.  Remember, this is a negative price, so the producers of the electricity are paying YOU for providing the service to them of absorbing unwanted electricity to avoid a costly plant shutdown.  So far so good.

Now, a few days later when there's a heat wave and everybody's AC is on full blast, and the power plants are cranked up to eleven producing every watt of power that they can.  And the wind?  What does it do?  It stops.  Dead calm.  Gee, thanks a LOT, renewable energy!

Ah, but you step forward and say, "Remember that surplus electricity I got from you for which you paid me?  Well, here it is back again, but this time the price is YOU pay ME $0.48/kW-h.  This will save your bacon until the weather cools off this evening, so it will be worth it."  And everyone cheers loudly.  Hooray, you.

But is this technically possible?  Can we actually store city-sized quantities of electricity?  The answer is "No, not yet."

People are trying everything imaginable, and even some things that couldn't possibly work.  Batteries?  Too expensive, environmentally questionable, and they wear out too quickly.  Flywheels, compressed air and ultra-capacitors?  These completely different concepts have the same problem: the energy is stored at variable levels of potential, making much of the energy unusable.  These are useful for very short-term storage (a few seconds' worth).

Some of the more promising schemes are liquified air storage, zinc-air mega-batteries, and double-basin continuous tidal hydroelectric, which can easily absorb unused renewable power.

Essentially, whoever figures out how to store massive amounts of electricity in the presence of increasing levels of installed renewable energy capacity will have nothing less than . . .

A license to print money.  That's how valuable it will be.

Wednesday, April 13, 2011

Why Inventors Go Broke and Investors Get Rich

I’ve often said that 997 out of every 1000 inventions never make any money. How do I arrive at that precise figure? I’ve been told by venture capitalists that they listen to some 100 pitches for unfeasible inventions for every one invention that they feel has enough potential to invest in. Further, out of every 10 projects that they put money into, only around 3 of them will succeed on average.That works out to 3 out of every 1000 inventions making money while the rest do not.

Clearly the averages are much worse than this for the individual inventor. There are probably hundreds more inventions every year that the venture capitalists never get a look at. The average inventor might be looking at something like a few chances out of 5,000 or worse. In any case, if an inventor puts all his money into one invention, the chances are not far from 99.7% that he will become 100% broke. So why don’t investors go broke as often? They have this Simple Arithmetic on their side that I’m about to show you, which inventors can also take advantage of.

Suppose an investor is careful and selects inventions that based on his experience will each stand a roughly 3 out of 10 chance of prospering. Suppose then that the investor combines his money with that of a group of investors so that as a group they are able to invest $1M into each of 10 inventions.
Early stage investments are made at a discount rate of a few cents on the dollar or less. For arguments’ sake we’ll assume that 0.10 is the rate of discounting on the value of the invention based on its estimated future value. The investors’ capital therefore stands to be worth 10 times as much in a few years when the inventions gets off the ground, were it not for the high probability of most of them failing. With a portfolio of 10 businesses bought at a discount rate of 0.10, how many of them need to succeed in order for the investors to break even? That’s easy. At least one out of the ten must succeed to cover the losses of the remaining nine. To double their money, two must succeed; to triple requires three successes and so on.

The probability of the first business failing is 70%. The probability of the first AND second ones failing together are 0.7*0.7 = 0.49 or just under 50%. The probability of the first three businesses failing in order is

If we keep going, we find that the probability of all 10 businesses failing is

But if this isn’t what happens, if you follow the logic, then at least one business will have succeeded. And if at least one business succeeds, the investor has broken even. The probability of at least one in ten businesses succeeding, which is the same as saying the odds of NOT having 10 failures, is

This is a very important fact for inventors to take note of.

While an inventor has at least a 99.7% chance of losing his shirt, an investor has a 97% chance of keeping his.

Now for some fun with numbers. What is the probability that exactly one of these hypothetical businesses succeeds while the others fail? One way this could happen is described by the following calculation:

In other words, the first 9 fail and the last one succeeds. The probability of that exact thing happening is 1.21%. Are there other ways to have 9 failures and one success? Yes: you could have the first one succeed and all the subsequent ones fail; the first fail, then a success, and then eight failures in a row, and so on. There are 10 different ways to have exactly 1 success and 9 failures if the order that they come in doesn’t matter.

This is called a “combination” and is calculated in this way:

And in this instance, it is

The probability of having exactly one success is therefore 10 cracks at a 1.21% chance = 12.1%.

In a similar way, there are

ways of having exactly 2 successes and 8 failures in any order. The probability of one of those 45 combinations occurring is

By continuing through all the possibilities, we can make some general groupings. The chances of having 2 or more successes is 85%. Three or more is 61.7%.

The investor who chooses carefully which projects to back and who diversifies over 10 projects at a given time will be almost assured (97%) of not losing any money at all. He stands a pretty good chance (85%) of actually making money, and almost a 2 out of 3 chance (62%) of at least tripling his money. With those kinds of odds, who wouldn’t want to be a venture capitalist!

What can an inventor do to increase his odds of success other than become an investor? Any inventor is well advised to think more like an investor by following these three rules:

1. Evaluate your invention ideas the way an investor would. Be passionate about your inventions, but do not fall in love. The passion isn’t enough: it must also be an outstanding investment opportunity. Determine the commercial potential, estimate the return on investment, make a valuation of the business, and assess the risk. Risk is not just some bad feeling in your gut: it is the probability of something happening multiplied by the cost of it happening. If there is a 70% chance of losing $100,000, the risk is $70,000. If the potential return on investment is 1000% with a 30% chance of ever seeing it, the reward is 0.3*$1,000,000 = $300,000. Is the reward worth the risk? Would you like to play that game once only, or as many times as possible?

2. Share The Risk with others. Don’t hoard it all for yourself. If something is going to cost a lot of money to develop, concentrate first on getting investors on board BEFORE you start spending money on prototypes.

3. Diversify over a number of inventions over time. If you pick your 10 best ideas with real commercial potential, I give you pretty good odds that at least one of them will succeed. But if you blindly devote yourself heart and soul to the first hare-brained idea that pops into your head, you’d be better off taking your money to the dog track.

Thursday, April 7, 2011

Should I Build a Prototype?

Inventors are universally confused about what to do first. One of the most attractive distractions from the real work of innovation is the potential for building a "prototype."

Because inventors are usually the type to enjoy tinkering, or are people who think more clearly while holding a physical object with their hands, or because they simply don't know what else to do, building a prototype becomes a serious temptation. But it is the wrong thing to do!

It is a waste of time and a waste of money.

A big part of the problem is that the word "prototype" is so general as to be devoid of any real useful meaning. It could mean anything from a proof-of principle setup, a proof-of-concept device, an operating principle test rig, a development platform, a performance testing platform, a pre-production model, a market test, a production proof limited run, a first-article production run, or the "version 1.0" release.

When an inventor jumps the gun and rushes out to build a prototype, he usually has no idea which of these he really wants or needs.

The first step to inventing is rarely anything to do with a prototype in any of its forms. The first step is always evaluating the idea and its potential, followed closely by learning all about the customer and his needs and wants. But that is another post for another time.

When the time finally comes to build a prototype, the inventor is advised to take a more practical approach by asking first what he needs it for, what he needs it to be and to do. Dispensing with the word "prototype" and adopting the more specific language I offered above goes a long way towards helping the inventor decide exactly what to do, and the cheapest and fastest way to do it.

Proof of Principle. Is the underlying operating principle of my invention actually correct?

Usually this has already been worked out by someone somewhere, and very likely the result can be found in a high-school science textbook. In many other cases, the information that building such a device might yield can be found in university engineering textbooks, published papers, or by doing a bit of simple analysis using pencil, paper and a 4-function calculator. Unless you're developing ground-breaking technology in a laboratory, you probably don't need to spend money investigating proof-of-principle. Talking to a qualified Innovation Engineer will usually answer all your questions.

Proof of Concept. Can the principle actually be used for my intended purpose?

The information provided by a proof-of-concept article is usually available through less expensive means. "But don't I need at least this in order to attract investors?" When looking for financing, you do not actually need a prototype. If the market research and business plan makes sense to the investor and his engineering advisors give the thumbs-up, you'll get the money. If an investor asks to see a prototype, it's because he is hesitating, he doesn't like the business plan, and isn't going to invest anyway. He's just looking for an excuse to say no.

Test Rig. What specific design parameters will result in the required performance?

This is specific knowledge that is best obtained through a methodical study rather than building "prototypes" all willy-nilly. You must know in advance exactly what the question is, and design a system for answering that specific question. Then you must have the skills for collecting, analyzing, and interpreting data. This is another area where an Innovation Engineer provides invaluable assistance and saves you enormous amounts of time and money that might have been wasted. In a lifetime and with all the money in the universe you can't learn everything you need to know to do it all by yourself.

Performance Test Platform. What can I promise my customers? Can it be improved through minor changes?

This stage is beginning to look more like a complete product, but it contains many more features that your customers will never need or want. These features are included for YOUR benefit. Knowing what to put in is something an Innovation Engineer does. Sensors, adjustable parts, fail-safes, and features that simulate real-world conditions are just some of the elements of a test and development platform.

Pre-Production and Production First-Articles. Will the production processes actually work and result in the desired product?

The production engineering phase is usually much further down the road than many inventors realize. It often comes after a second round of investment and is in itself a specialization that professional production engineers need to help you with. The process is the product, and no one gets it right the first time.

Do not start building a prototype unless you know its exact purpose, you understand exactly what you need to learn from it, and you have the exact skills in place to make it not be a waste of time and money.

More information, advice and resources for inventors is available at:

Monday, March 22, 2010

To Patent or Not to Patent?

Inventors and innovative business owners ask me this all the time. My response is this:

Are you even ready to ask this question?

Far from a dodge, I believe this is the correct process that produces the best, most cost-effective outcome in the long run. Too often the question of whether and how to patent is regarded as the central issue around which the entire project revolves. I believe this is a mistake.

Your Intellectual Property (IP) strategy, once it is formed, may or may not include patents, copyrights, trademarks, registered designs, trade secrets, moving targets and other tactics. The decision to patent is just one little component of an overall IP strategy.

Your IP strategy is in turn just one little component of your complete Business Plan. The Business Plan must summarize and outline how exactly the idea or invention is going to bring money in the door. How much money? From where and from whom? For how long? When you have realistic answers projected for these questions, you are now prepared to think critically about the IP strategy. How does the inventive step actually contribute to the business' income and how critical is it? How long does the novel element of the product need to be protected?

Once these questions have been addressed in your written IP strategy, you can think about how to accomplish those objectives. Consulting with a patent attorney is a good step. Be aware that many are qualified to advise you on whether or not the IP is patentable, but not necessarily on whether or not you should do it. Usually they can advise you on what form the protection will take and whether a given form of protection will meet your known IP objectives. The better you know your own business objectives, the better the patent attorney will be able to help you.

That is why I suggest that you start with a business plan, develop the IP requirements, and only then are you and your patent attorney prepared to answer the original question.

One major misunderstanding of patents was summarized in a question asked by a backyard inventor: "I now have a patent, so when does the government start paying me for it?"

Oooh. Sorry to burst your bubble, mate. A patent is not a golden ticket to wealth. Only a successful new business resembles that vision, and only faintly. Patents are not enforced by governments, but by YOU the patent holder, and your team of lawyers. It will be your responsibility to be on the watch for, to seek out, track down and prosecute any infringers in civil courts. It will also be your responsibility to defend your patent against others who claim it infringes on THEIR patents. These kinds of lawsuits are common, and many are nuisance threats hoping for a quick easy payout from you. But each one costs you money in the form of billable hours every time your attorney takes your phone call or responds to an email.

Is it possible to manage without patents? Yes, I know of instances, and some very successful ones. If the product's innovative step can be concealed, or is actually part of the manufacturing process that someone purchasing the product would never see, then you can simply keep it a secret. It will take competitors a few years to work out how you do it, but by then you're onto something else and improving your process further still.

It is also possible to be first to market and establish a respected brand image. Cheap imitations will crop up, but there will still be a market for higher-margin original products. Consider Swiss watches, for example. A high quality mechanical watch can fetch tens of thousands of dollars, even though a cheap $2 digital watch is actually far more accurate. Establishing such a desirable brand can take decades, however.

Or, why not simply make money on a new product for the 6 - 12 months it takes for cheap copies to show up, then switch to the next innovative product, or offer your customers some new innovative advantage? If a product's total return on investment over the life cycle is not significantly larger than the cost of obtaining and defending a properly-written patent, then it's simply not worth doing. My estimate is that you should initially set aside $200,000 for your patent attorney should you choose to patent.

To patent or not is the wrong question to start from. First ask, "How exactly will this invention make money, and how much?"

Sunday, March 21, 2010

A Nuclear-Powered Argument

On 4 March 2010 the WA Business News published an opinion piece I wrote about the hidden costs of nuclear energy to the taxpayer, and about whether nuclear energy was a good choice for Western Australia.

I received a very rude email from a politician who had taken great offence at my stance on the issue. Among the hidden costs I highlighted was the cost of decommissioning a nuclear plant at the end of its service life. The cheapest way is to simply lock the doors and go away. But even that strategy is expensive, usually to the taxpayer, because SOMEONE has to maintain the site, and SOMEONE ends up owning the property without the possibility of doing anything useful with it for quite some time to come.

Dr. Dennis Jensen, MP, was outraged and reminded me that many old nuclear sites have been rehabilitated over the years. Well, duh! I don't disagree with you, Dennis. There most certainly are many more expensive ways to decommission a nuclear plant besides just locking the doors. The point is that it costs money, and it's a cost usually borne by the unsuspecting taxpayer.

Dennis provided ample data to support his belief that nuclear power is actually quite cheap. The data comes courtesy of the manufacturers of nuclear power plants, so we know they aren't biased or anything.

Cheap for who? For the energy companies, maybe. But not for the taxpayer. The costings based on best-case scenarios do not include the cost of financing, overseeing, administering, providing security, building infrastructure and a host of other functions that governments habitually do in relation to nuclear energy. Interestingly, Dr. Jensen had nothing to say on that subject.

But the real point ignored and sidestepped, in typical politician fashion, is whether nuclear energy is a good fit for Western Australia.

WA is a state of around 2 million people with a land area of about 2.5 million square kilometers. That's about 1.7% of the Earth's land area, with less than 0.03% of the population. Half of that population is centered around Perth, leaving large swaths of the rest of the state virtually uninhabited.

WA does not have a large industrial base, and is by no means a "24-hour economy," since most businesses including large supermarkets must, by some ludicrous outdated law, close by 6 PM nightly. There are many mine sites are spread out around the state, and most do not have access to the integrated electricity network. They often rely on diesel generators.

Nuclear energy is primarily a baseload supplier of electricity. The economics of nuclear energy rely on scaling up. In other words, it's more affordable when you build the biggest power plant that you possibly can. As long as you're going through all the expense of making a nuclear reactor anyway, you may as well make it huge so it can pay down the mortgage faster.

WA's energy consumption consists of mainly peak power with a relatively low baseload requirement. Why, then, should WA consider installing massive baseload electricity generation capacity in the form of massive nuclear generators? Even if it were cheap, it would be a bad idea.

Another essential factor is geography. Nuclear power economics rely on the ability to sell excess electricity on an open energy market at a spot rate. On a large interconnected grid system,there will always be some energy provider somewhere having a problem meeting their own needs and will effectively have to buy electricity for their customers elsewhere.

In WA, there is only one energy retailer. WA doesn't have any close neighbors to whom it can sell electricity. The WA electricity network is tiny by international standards, and is completely stand-alone. It therefore has no capacity to buy or sell electricity, but must use all it can make and make all it can use. Nuclear energy just doesn't make sense for a market like that.

I am neither pro-nuclear nor anti-nuclear. It might be right in some situations, it might not be in others. Some technologies and reactor designs might be safe, others might not be. But the factors that help make nuclear power cheapER are objectively absent in Western Australia. For WA then, nuclear energy would be an expensive and wasteful exercise. Of this, there is little doubt.

Wednesday, January 27, 2010

How to Avoid another Firepower

The backstory here is a complex web of companies known collectively as Firepower which has, for at least the last 10 years, been claiming they have a "fuel pill" technology that decreases a car's fuel consumption, decreases emissions and increases performance. No credible proof of these claims has ever been tabled, while hundreds of investors cluelessly shelled out up to $120 million Australian dollars.

The following is a synopsis of a Guest Column published in the Jan 28, 2010 issue of the WA Business News.

How to Avoid another Firepower

The Firepower story was possibly the first Australian newspaper article I read upon arriving on these shores nine years ago this March. I was deeply annoyed by it then, and continue to be so today.

Hadn’t we learned from the Dot-Com bubble and the Enron disaster that a business based on fiction is simply never a good investment at any price? Aren't such businesses and their claims worthy of harsher scrutiny in the press?

Without individual “sophisticated” investors handing over at least $120 million to fast-talking promoters without any proof that the product actually worked, there never would have been a first Firepower.

Properly-conducted tests that would demonstrate conclusively whether the product worked could easily have been performed, and should have been insisted upon by investors. In one week and for $3000, we could have tested two identical hire cars using two drivers, locking fuel caps, and a properly-designed double-blind experiment. But for investors to realize that this is both necessary and possible, they must possess at least some basic science literacy.

Then, for the work to be carried out, a person is needed who has the right training, experience, and understanding of the basics of commercial research.

When science has a more prominent place in our everyday social discourse, then fewer people are taken in by jargon, wild claims, or fishy statistics. It’s not a matter of being super brainy, either. We can easily agree on what constitutes a fair and conclusive sports contest, but are unaccountably fuzzy on what constitutes a fair and conclusive scientific test. There’s really not that much difference.

Another consequence of greater scientific literacy in the community would have been less media indulgence of Firepower’s claims without proof. Newspapers balk at printing anything even remotely technical-sounding for fear of alienating their readership. Yet in their pages we regularly read quite sophisticated financial, legal and political information that is just as demanding intellectually. If that irrational fear of science were set aside and if editors and reporters were themselves more scientifically literate, then patent rubbish like perpetual motion, cars that run entirely on water, and magic fuel pills (not to mention a whole host of health-related mumbo-jumbo) would not be reported as though it were factual.

When the public reads those sorts of naively credulous articles in print without expert comment or mention of proven facts, the unchallenged claims become endowed with authority and legitimacy that are undeserved. As a result, the public becomes even more confused about the facts of nature, and even more money gets wasted on nonsense.

But who can the media turn to for reliable information? Who can perform the kind of independent testing investors need? In places where more businesses have the foresight to invest in their own internal R&D operations, reporters, managers and investors have closer relationships with experienced research specialists. Engineers and scientists who are especially trained in for-profit commercial research and product development are available to respond to questions with straight, plain-English answers. One such question might have been, “Does this fuel pill thing have Buckley’s chance of actually working?”

Universities and the business community are worlds apart in terms of culture, goals and incentive structures. This means that technology research expertise is not always well integrated into the business and investing community.

Because of this, businesses and investors may remain unfamiliar with ideas which are standard best practice in R&D. An example is the R&D third-party review (see an earlier post). Someone who is neither the customer nor the vendor and who possesses the relevant expertise provides an independent, confidential assessment of R&D plans, progress and results. Where I come from, managers and investors absolutely insist on having these at regular intervals. They do it because in the long run it’s cheaper than not doing it.

Far from being unique, Firepower is only the latest case of money lost on a fictitious product wholly unable to back its claims. In the 1970’s, an investor friend of mine lost a lot of money to a man who claimed his special device could produce unlimited free energy. When I explained to him in detail why that sort of thing doesn’t work in this universe, he said after a few choice words, “Where were you in 1975? You would have saved me $300,000.”

Sadly, this sort of scam will almost certainly happen again. Rather than more laws and greater policing by the State, I suggest that a higher level of science literacy in the community would go a long ways towards protecting the life savings of everyday mums, dads and grandparents. It begins with an earnest investment in science education in schools at all levels, and is helped along by greater acceptance of science and its language in the news media.

If the ultimate outcome of the Firepower saga is that we learn these lessons, then it may have been money well invested, after all.