As the startup societies movement has matured a few core tenets have emerged to explain the value of creating startup societies to the broader world. The concept of competitive governance is one of those tenets. In a nutshell, the theory of competitive governance advocates for a world where governments compete for citizens in a similar fashion that companies compete for customers.
This governance-as-a-service market would then incentivized governments to innovate more solutions to their citizens’ problems. In 2011, Patri Friedman explained that “...a startup sector for government means more competition, more new ideas, [which] means things will eventually improve in the current large providers (existing countries).”
Describing government as a dated industry ripe for disruption is useful for catalyzing ideas for innovative alternatives. However, framing startup societies as rivals to existing countries does not direct the next iteration of experiments to the most pragmatic path forward and can alienate the industries most important allies: existing countries.
Surveying the industry as a whole indicates that a market of collaborative startup societies will be the main driver of growth. Framing opportunities this way opens up new possibilities to develop solutions to difficult problems around the world. While there are many examples that demonstrate this point, the Rawabi project is a particularly inspiring case to explore.
Joe McKinney spoke with the founder of Rawabi earlier this year on the SSF podcast which you can find here. As a quick recap, Bashar Masri began building Rawabi in the West Bank nine years ago. He envisions a city that strengthened the Palestine nation by providing a modern city for a Palestinian middle-class and technology hub. For Bashar, the construction of Rawabi is in the end really about the construction of a new modern state of Palestine.
In his conversation with Joe, Bashar explains how he sees Rawabi contributing to Palestine -
“In order to have a strong state you have to have different pillars: good governance, excellent human civil rights, and of course a strong economy and high standards of living. Rawabi is focusing on that [last] part as the main issue, but of course by building a new city you need to focus on many aspects of life that we would like to have in a new modern state, like a secular state, like a democratic state.”
Rawabi isn’t under any new government jurisdiction, but Bashar is introducing political experiments at the city and neighborhood level with democratically elected municipality council members and HOA representatives. “That’s practicing democracy at the grass roots” he says. In addition to introducing new ideas of governance to Rawabi, Bashar also hopes to make Rawabi the technology center of Palestine, a project that largely depends on creating synergy between the economies of Israel and Palestine.
Palestine has an unemployment rate of 31%, many of whom are graduates with degrees in IT and computer science. Israel, on the other hand, has a shortage of mid-level technology workers. Bashar intends to capitalize on this by making Rawabi a tech center where both parties meet each other’s needs.
“I think it’s very important to change the formula...I am a believer that our destiny is together. We are here to stay, and they are here to stay. We have had many years of animosities...We need to move on and make the best out of it to build our nation...There is nothing wrong with turning the animosity into a win-win situation moving forward.”
If Rawabi does become a tech hub for both Israeli companies and Palestinian workers, commerical cooperation could lead to progress in other areas. Yale professor Ian Shapiro also believes business connections can act as a catalyst for political progress in the West Bank. He points to examples of conflict resolution in Ireland, South Africa, and Columbia that were made possible in part by an economy that set the stage for collaboration in commercial industries. Shapiro explains that “Once people can perceive a different set of economic possibilities, these incredibly ossified conflicts can start to be seen in a different way. People will see possibilities that they would never have dreamed of before.” You can read more about the case he developed for his Yale students here.
Bashar’s motivation is the exact opposite of competitive. Bashar Masri and Ian Shapiro envision Rawabi as an innovative trailblazer that is using new infrastructure as a way of creating space to experiment with new ideas in order to strengthen the Palestine nation. Both men also believe this will be done by supporting the economy of Israel as well.
This is a very different approach to progress than what is described under the competitive governance framework. To revisit the commercial industry analogy, if Palestine is Uber, Rawabi seems to act more like Uber Eats than Lyft. Rawabi could also be framed as a B2B company that is in some ways servicing governments rather than competing with them. The point is that Rawabi demonstrates that there is a wide range of opportunities outside the framework of competing with governments.
A clear pattern emerges when surveying other startup societies around the world that shows Rawabi’s collaborative relationship with existing states is not unique. In a Forbes article by Wade Shepard that describes new city projects around the world, each project described is being planned and developed by and for the power of states (Rawabi is the exception in that it is privately developed). Dubai and Shenzhen are also notable examples of startup societies with symbiotic relationships to a host state. The seasteading project in French Polynesia was also highly focused on supporting their host country - just watch Joe Quirk boast about projections of generating $7 million in tax revenue for the French Polynesinan government in this video.
According to Robert Entman, frames “select some aspects of a perceived reality and make them more salient in a communicating text, in such a way as to promote a particular problem definition, causal interpretation, moral evaluation, and/or treatment recommendation for the item described." Frames are tools for understanding by focusing attention on specific aspects of a concept. This implies that looking at a concept through various frames enhances the ability to understand the various aspects of that concept.
Competitive governance is unlikely to be the primary frame that the next iteration of startup societies fit in. Based on industry trends, startup societies are more likely to gain traction by framing their projects as collaborative projects to be built in conjunction with states. With this in mind, industry thought leaders and entrepreneurs should develop frames that acknowledge this reality. Doing so would not only reveal more opportunities to build startup societies, it would also encourage governments to support projects.
Recent events off the coast of Thailand are healthy reminder of how governments react to competition, real or perceived. In this CNN article, Colonel Kataporn Kumthieng, chief of Phuket’s Immigration office said this about Chad Elwartowski and his partner Nadia Supranee:
"By claiming they own a floating house and using social media tried to sell this kind of house, also they claimed that their house is not under any country's sovereignty, which is not true. And this could cause other people to misunderstand and it is threatening our national security,"
The point is governments take competition very seriously. Perhaps the Ocean Builders project would have gained more traction if had been viewed by the Thai government through different frame. Future projects of a similar nature should consider this.
Optimizing for the Next Generation of Startup Societies
Rawabi is an inspiring example of a startup society that is working on an innovative solution to an issue that has not made any progress for decades. Many more similar opportunities await. Industry thought leaders have advanced ideas on how startup societies have a unique ability to address global issues such as poverty, refugees, and global warming. An important next step to support entrepreneurs is fleshing out and marketing more frameworks for how and why startup societies should be developed.
Even with a market of competitive governments as the ultimate goal, new frames are an important step towards igniting the next generation of MVPs. In an interview last year Patri Friedman confirmed that the Seasteading Institute’s goal is still “...to scale up towards the dream to floating Hong Kong in the high seas.” Collaborating with French Polynesia was simply the most pragmatic path to creating meaningful progress.
Industry thought leaders can accelerate the evolution of startup societies by promoting new frames that optimize for guiding the next generation of entrepreneurs towards solving problems in conjunction with states. Entrepreneurs can then frame their vision to politicians as non-threatening projects. And as these projects experiment across the globe, the startup society industry will grow and evolve with a deeper understanding of what more ambitious projects will require.