The Fun Factor

What's really driving the new economy -- and confounding the grand pooh-bahs of the old one -- is that individuals are having a huge impact. And an awful lot of fun.

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New Economy

The drivers of the new economy are not the usual suspects

Alan Greenspan has never met Dave Bell. If he had, he might think twice about clamping down on the economy by repeatedly raising interest rates. (Greenspan may be changing his tune anyway. In a June speech, and for the first time, he acknowledged that some recent economic gains, specifically in worker productivity, seemed permanent and appeared to be "largely driven by irreversible advances in technology and its application.")

Meanwhile, as Uncle Alan continues to pull the master levers from inside the marbled preserve of the Federal Reserve, Bell is hard at work in the bowels of this new economy, building his company. Nothing unusual about that, except that Bell is a senior at Nashua High School, in Nashua, N.H.

Four years ago, when he was 14, Bell started a game-development company, now called Chasma Inc., which has grown into an online network created by teens for teens ( www.chasma.net). It features the stuff that his peers really care about -- computer games, music, sports, entertainment, and the news, all created and interpreted from a teen perspective. At last count, Bell had 35 employees, most of them in Nashua but some scattered around the country and wired to the company. He was in the midst of raising $1.2 million and had leased 14,000 square feet of office space.

The only adults in sight are on Bell's board. "He has this incredible network of human resources on the high school level," says one board member, Todd Feinburg, managing director of 1590 Broadcasting Corp., which owns WSMN Radio, in Nashua. "This kind of work is no big deal to them. And it's easy for kids this young to come up with ideas."

Bell echoes that thought, saying, "This isn't a company but a revolution. A lot of kids have skills, but no one will give them a chance. We're giving them a chance to make a difference."

Feinburg believes that "these kids who have grown up with keyboards glued to their hands represent an untapped resource." And that "represents a shift of who's in control of the economy." The information economy, he believes, is far more "democratic" than anything that has come before it, suddenly offering 18-year-olds meaningful access. "All you need is brainpower and processing power -- and that's incredibly cheap. The talent is right here in the schools."

Bell got his first infusion of capital -- a little under $100,000 -- from the Breakfast Club, a local group of angels. "We invested because he's a young kid," says the Breakfast Club's Dick Morley. "We are in this for the adventure." Morley says his group hasn't really asked that much about the product or the technology. "We don't really care about that," he says.

What struck Morley were two things. First, when he initially corresponded with Bell through E-mail, he thought he was dealing with a 35-year-old. He was impressed by how Bell discussed such issues as value versus cost and that he mentioned an exit plan, which showed that he was mindful of providing a return on his investors' money. "I thought to myself, 'This kid really understands,' " Morley says. He comments that young people today not only know a lot about computers but also are financially savvy.

Morley, who recently cowrote The Technology Machine: How Manufacturing Will Work in the Year 2020 (Free Press, 1999), invested in Bell for a vital second reason -- "cultural bandwidth."

As technology advances it outstrips society's ability to adapt. And some cultures resist change more than others -- they have narrower bandwidths. Morley cites France and Japan, which he says often have xenophobic, knee-jerk reactions to external advances. Cultures with more bandwidth, according to Morley, are South Korea, Taiwan, Hong Kong, and the United States. He says that, historically, cultures with fewer physical resources, such as the Dutch and English in colonial times, postwar Japan, and New England, Silicon Valley, and Seattle today, have more bandwidth and are thus more receptive to new ideas, change, and progress.

And that brings Morley, who has funded about 70 companies, back to Bell. After all, he reasons, teenagers constantly experiment with fashion, music, and even identity -- what other group has more bandwidth? And in Morley's view, that makes a smart kid like Bell perfectly suited to today's economy. "This kid is fast," Morley says. "He's one of those small, smart, furry animals that likes dinosaur eggs."

In my travels I'm often asked which is the most interesting company I have written about. If interesting translates as fun, then certainly one of the most engaging stories I worked on was a 1992 piece on Southwest Airlines that featured its irrepressible cofounder and CEO, Herb Kelleher. I recently went back and looked at that story. Here is how it began:

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