Airline Start-Ups – an Unreasonable Risk?

Two (good) articles today about the riskiness of starting up an airline and the comments they got shared with, triggered some controversial thoughts with me.

The Articles + Comments

Airline Cash BurnOAG summarized on the Evolution of airlines since 2019 (just before the Pandemic) to today. While their findings are very interesting, there is a tone in the summary and a resulting summarization by Tim (someone I generally value) that I happen to disagree with. OAG’s John Grant wrote:

“Airline start-ups are incredibly difficult, cash rapidly disappears and securing the necessary operating licences frequently takes longer than expected and that’s even before sourcing aircraft, securing slots, avoiding the competition, and building all the necessary reservations systems and back-office support functions.”

And Tim shared the full post with a comment: “OAG is a great data resource for large scale review and schedule activity. This data really doe strike a chord. Airlines are a very risky business. This is very illustrative.”

The other one was an analysis by McKinsey, checking on the aviation value chain’s recovery shared by Patrick, which he introduced with these words: “McKinsey & Company has done an interesting analysis of the aviation value chain. For each subsector, they’ve calculated the “economic profit”, meaning (return on invested capital – weighted average cost of capital) x invested capital. In other words, are firms in that sector creating or destroying value? Their conclusion: only fuel suppliers and freight forwarders created value last year, and airports and airlines lost a lot!”

The Economist’s (My) Response

Mass Market - No ProfitAs an economist by original education and having experience with Startups and Business Angels, I do happen to believe in a sound “business case”. As an airliner, I learned with American to focus on the business case. Like to reconsider twice before approving any waiver on fare rules or trying to upsell to the more expensive (i.e. more flexible) air fare. But I also learned the value of a renowned brand (AA) and service. Or to treat your colleagues as your most valuable customers – they help you sell each and every day. And can ruin a customer relation as quickly.

In “global fares training”, I learned the cost of a flight transfer, something that I never forgot; thanks Ruth King (our fares trainer), I will never forget you.

At Northwest Airlines, I learned that airlines and their managers just sold “cheap”. With full flights in summer season, the airline generated losses on the transatlantic flights. A lesson I’ve seen later over and again. Most sales staff had neither information, nor idea about the “yield” they had to generate to fly profitable. Northwest focused on a minimum yield (revenue per seat-mile) half of that of American. Then sold at that yield as the standard “special fare” and making group offers or “reseller-rebates” below that rate aplenty. As I summarized 2019 on my article about why airlines keep failing, “know your cost”.

Yes, talking about Why Do Airlines Keep Failing. It’s the same response I have on the above two mentioned articles. And many like them. At ASRA 2008, I emphasized brand faces. But I also told those brand faces – the airline sales managers – that they are not there to sell the cheapest price. Anyone can do that, the Internet lives of that. A real sales manager understands that they have to sell the high-end tickets.

Live story, also happened today. Qatar Airways passengers (mother and three kindergarden-aged kids) arrived with >18 hour delay in Düsseldorf. German Rail (clerk) sold tickets to the customer to pick up the passengers that are neither change- nor refundable. So they had to buy completely new (expensive) tickets. A good clerk of this company renowned for it’s unpunctual trains (<60%) would have mentioned the possibility of a flight delay and sold the slightly more expensive tickets that allow for a change. Or at least the optional insurance.

So thinking back to my experiences with Northwest and other such airlines, it’s my questioning about KPIs as well. If my KPI is load and not revenue, I must expect to loose money. It remains beyond me, why airlines offer connecting flight at what a rough calculation on Ryanair or easyJet CASK/CASM (cost per available seat km/mile) proves as below cost, even without the “stop en-route” (landing fees, complexity, etc.). Those are managers who had a nap, when their tutors talked about sound economical calculation? And I keep questioning, why airlines publish loads without revenue per seat. To date, we have hundreds, if not thousands of flights every day, that fly full but loose money. All this is confirmed by the above mentioned and many other such articles.

The Fairy-Tale of Loss Making Airlines

Heresy. Aviation ain't profitable - and the world is FLATTo claim “aviation” is a loss making business is true and can’t be further from the truth.

Yes, many airlines are loss making. And it fits the common reasons I elaborated before. And yes, you can make airlines very profitable, if you have a management that thinks just a bit outside the box and applies economic rules to their modus operandi (mode of operation). But this also goes in line with route development and other areas. If you don’t have your numbers under control and focus on the ones that are “good to sell to shareholders”, you’ll fail.

Like with any company, with any startup, in and outside the aviation sphere, we must constantly have an understanding of our cost. And of the competition. What is it our customer wants? There is a psychological price. If you missed that in your economics studies, make your Internet-search for it now. If you have sales teams, train them to upsell the seats. Sell the higher yield fares. Not at a discount, but at a value!

Natural Leader LemmingsThis is one reason, I do not believe we can make Kolibri ever happen by taking over an already failing or failed airline. Wrong structures, wrong thinking in place. I learned this lesson with Air Berlin. The force of inertia was simply too strong. There are some airline that make revenue, but even their managers I find often blindly “follow the worms” (a Pink Floyd referral, yes, the picture is lemmings).

(That’s) The Way Airlines Operate

But unfortunately, all investors we talk to, always think inside their boxes. Can’t tell how many talks I had to radically change our approach and take A320 and do like everyone else does. Ain’t that contrary to the concept of Unique Selling Propositions?

And has ever a “disruptive investment” (another investor buzz word) been developed out of the box using the same thinking? The same values (I’m the cheapest)?

The others are usually starting to tell you that you have to start with smaller amount of money. Sure way to burn your money is a cheap business plan. As OAG writes “getting to size is so important”. You can’t produce a low cost in small numbers. For us, the ideal mix is seven aircraft, where the “administrative overhead cost” becomes manageable. i.e. You have the same cost if you maintain one – or seven aircraft. The same reservations office (just less staff and calls), only little less marketing. You must outsource your operations (at cost) to share the necessary organization with other small airlines. Etc., etc.

Source firewalkeraussies.comTo date, I am still working with consulting companies reviewing airline business plans. Aside the usual failure issues, size is a recurring issue. Another being the lack of fallback in case of flight disruptions, may they be caused by technical issues, weather or other events. Their focus on cheap “human resources” and missing team building results in friction and internal competition that further weakens their product offering.

But even taking that into account, we believe the business and financial plans we developed are sound. And profitable from the outset. With a focus on services and a military-style responsibility “for ours” (no “HR” in that company), a “service-focused concept”. Everyone to pull on the same side of the rope. Yes, not starting with a dead corpse, trying to revive, adds some bureaucratic hurdles. But it allows you to think outside the box and instead of following the worms (or other airlines), to do things “right”.

So ever since I entered into the business, I learned at American Airlines under Bob Crandall how to do things right. And learned over and again that the same mistakes are made by short-sighted, narrow-minded managers. And I know all the reasoning used to distract and divert off the incompetence to operate an economically sound business. Usually, I account this as “no faith in your brand”. That then goes along with topics I mentioned before, like brand dissolution (airlines are often academic example), missing USPs, etc. – Cobalt CEO told me about their USP shortly before their demise “We are Cypriotic”. Seriously? When I started, Lufthansa was the brand. Lufthanseat was the employee. All employees of American Airlines knew “Proud to be AAmerican”. Then came the button counters. And mighty AAmerican was taken over by their once-small rival U.S. Airways. Another box of memories.

So yes, airlines are often a loss making business. With bureaucrats leading them into disaster. Sometimes fast, often times a veeeery long death. Air Berlin and Alitalia are very good examples. “Too big to fail”? Simply “prestigious”? And there are “the others”. Airlines that have an idea about what they are doing. That know their niche(s). That know their cost and marketing. That value their brand. That build a reputation. Until button counters (aka. bureaucrats) take over.

I hope that someone of my hundreds if not thousands of readers (hard to believe, that’s what my server stats claim I’d have) knows some investor with the guts to understand that profitable aviation and sustainable aviation can be the same thing. That the stories those consultancies and their statistics and reports tell have two sides to the coin. And that we get a chance to proof, that climate neutral flying is no heresy, but the future of flight.

Food for Thought – Jürgen

The Panacea Distraction

The #panaceadistraction - While searching for the panacea, non-decision-makers keep running their business as usual.The #panaceadistraction disqualifies many #impactinvestments as greenwashing. A look at realpolitik in impactinvesting.

The Trigger: Lubomila’s COP21 statement

"Our Obsession with technology will slow down the green transition.” [Lubomila Jordanova]Having been reminded again of Lubomila Jordanova‘s statement for the U.N. Climate Change Conference 2021, it bugs me, how little has changed in those past two years. Working with climate activists up to United Nations levels, I find a lot of what we call #academicthinking, more about Science Fiction than about taking what we have to the market. A #panaceadistraction if I’ve ever seen one.

And while #buzzwords used by investors are #disruptiveinvestments, #sustainableinvestments and the like, a big part of the #panaceadistraction is their focus on (classic) “boxes” to invest in. Can’t tell, how many times in the past decades I have heard, that our ideas wouldn’t fit the box. #thinkoutsidethebox and #thinkbeyond.

The Sustainability Lie: Stay inside Your Box

Illustration by Hans-Jürgen Marhenke (loaded directly from and linked to the Heise.de website)

The direct “impact” is that #impactinvestments are mostly #greenwashing on #lifecycleassessment and #circulareconomy – very often blindsiding the #energydemand, using the cheap excuses of “we purchase #greenenergy or #climatecertificates … I was recently told that the industry creatively sells multiple times the amounts of “green” energy we create. I can imagine that. Aside of my #railshame-article, cleaning the green color of the mighty German #greenrail. Just another reference to the Sustainability-Energy Dilemma.

ASRA 2008 brainnodes vs. internet equals AIOr #artificialintelligence (just like space) – being a big dream (some consider it a threat). A big investment interest! Whereas most if not all of AI I’ve seen fits the statement that most AI is IA: More (or often less) Intelligent Algorithms. Yes Athena, Minerva and Mike Holmes, I’m waiting (wondering who understands that reference on the fly)…

So how #sustainable is #impactinvesting really? And which #impactinvestors in reality are part of the mighty #greenwashingindustry? Or do they focus a bit too much on the #panaceadistraction instead?

A Look Back: Pioneering and Disrupting

As a kid, I saw those pioneering constructions on those triangle-shaped hang-gliders, today both bureaucracy and investors wouldn’t invest a penny. But they lead to paragliders, a huge industry today.

Back in 1995, the big four in aviation technology (Amadeus, Galileo, Sabre and Worldspan) actively and with might opposed the development of booking flights on web-basis. How “disruptive” was that “stupid” idea? And yes, I made it happen, together and funded by a visionary Louis Arnitz (RIP). And yeah, that was the time Bill Gates disqualified the Internet, promoting his Microsoft Network.

Hydrogen powered Wing in GroundIn 2008, I developed another “disruptive” idea of a hydrogen-powered WIG, to promote the need to think sustainable on a global aviation conference. While it made it through viability study into serious negotiations by a tropical government and a major green fund, it fell victim to Lehman, but I still think it should have been developed. Though since #synfuel came up (2019ish), my bets are on that technology, I even applied it to our plans for Kolibri, closing the huge black hole where before our ideas of #biofuels were more or less a band aid on a searing wound. Aside that I prefer we grow food on the fields and not biofuel-rape. And why is it rape has such a bad double-meaning?

Though I’m a caller in the dark it seems, at least when talking with mighty investors – they fall back to their boxes and disqualify “aviation” as “not something we invest in”, without even a second look. #talkthetalk, focusing on the #panaceadistraction instead.

Think Positive: The Solutions are There!

There is so much #disruptivetech out there with a business case (aka #impactinvestment), beyond that I integrated into the plans I have for Kolibri, lacking the funding support, lacking the vision of those self-proclaimed #impactinvestors. And a lot of #talkthetalk again. i.e. #energybuffer technologies, alternative energy sources such as #tidalenergy – why only offshore-wind? Though nothing we do, nothing comes without a toll. Remember the #butterflyeffect and the Sustainability-Energy Dilemma.

As a direct result, we have an exploding #sdgfundinggap for sustainability and climate developments. It’s not the first and not the last time, U.N. Secretary General Antonio Gutérres called and calls this #fartoolittlefartoolate.

Butterfly Effect, e-Mobility Lie and the Panacea Distraction

e-mobility Life Cycle Assessment Greenwashing Volkswagen AGWhile my readers and followers know that I question #windpower and emobility for #greenwashing and short-term thinking, I also promote the fact that we need the change. We must act. Today.

And while e-Mobility ain’t the panacea, politicians and media tries to make you believe, hydrogen and synfuels ain’t as impossible as they frequently claim either. It’s ambitious to turn our world away from cheap, endless “green” energy and the believe of endless resources. Earth Overshoot Day is bad enough, this year August 2nd. Looking at the country level I feel even more devastated (Germany was May 4th)

Country Overshoot Days 2023
Country Overshoot Days 2023

The Fairy Tale of Zero-Carbon

Basic physics: Movement requires energy. Anything we do requires energy. Travel from A to B, even when using a sail boat (as Greta Thunberg did to cross the Atlantic) requires Energy. And resources. As an economist, I know that anything comes at a price.

So there is no #zerocarbon. If we achieve #carbonneutral, we do very good! If we can reduce our abuse of our natural resources – beyond carbon – we do good. Our target must be to move Earth Overshoot Day to December 31st or later. Next year, in two years. Not even Kolibri will be 100% resource neutral. But if we can turn it 90-100% circular, if our energy consumption is renewable, we will have a major impact to Earth Overshoot Day.

Why Fossils are Problematic

Don't Choose ExtinctionFossils conserve climate gases. While Venus consists of very similar chemical setup, the climate gases on the planet are uncontained. In turn, temperatures there are above 400°C. If someone tells you, we can keep using conserved energy like fossils or the latest ideas using deep-sea manganese nodules, this is climate gases we add to a heavily saturated Earth atmosphere. This is, why yes, I believe we must end fossil consumption (incl. excessive use of plastics) as quickly as we can. Or reduce it to an absolute minimum. Yes, plastics have advantages, but mostly can be replaced by more sustainable solutions. And keep in mind, plastics are used and globally applied by the mighty, rich industry nations. Who’s richness being a result from securing and using cheap fossil energy.

So mostly, this is about fighting the people who rely on cheap energy for their business models. Do I hear “digital” somewhere? 😂

So true #greeninvesting must focus on energy conservation and intelligent use of the energies we have. Personal, fossil, “renewable”. And yes, I put “renewable” into quotes… Just: #dontchooseextinction!

Holistic Approach and All-In

Offshore Windpark (Husum)Another issue that keeps coming up in my discussions is that we must stop competing on sustainable solutions. This is a major, not even just an industry or generational challenge. It’s a global one. So let’s stop competing and start joining forces! Back to my example of offshore wind farms and tidal energy turbines. Why not using them side-by-side in the same sea region we anyway impact by building those humongous wind farm structures? Why not using old Oil Rigs to apply tidal energy turbines, clean them, make them an artificial island structure for sea life (also arial one)?

Live Cycle Assessment and Earth Overshoot Day

Circular EconomyWhat I learned in my discussions with “green” activists up to government and U.N. levels, is that there is a lot of #wishfulthinking out there. A lot of #cognitivedissonance, reasoning to oneself that the bad-doing ain’t “that bad” or even good. And a #greenwashingindustry that uses that to protect their status quo. Not just at “all cost”, but in fact at the cost of our living and breathing environment!

To identify Greenwashing quickly, I mentioned to look at energy bill. United Nations urges to look at the #lifecycleanalysis and an end to end #circulareconomy. We must stop #raisinpicking to fake green, but what is our impact to the planet. Then we talk about #realimpactinvestment. And not at another #panaceadistraction

Food for Thought!
Comments welcome

Sustainability – Ideas for Discussion

Going Beyond Greenwashing

The United Nations Sustainable Development Goals

This is not about Kolibri, but some thoughts and assessments about sustainability and greenwashing. And some ideas on why all the statistics show that the situation worsens. From Earth Overshoot Day to Energy Consumption to rising CO2 levels.

Working on Kolibri and benchmarking our cost against easyJet and others, we found our cost too high. One of the typical reasons for the airline one-day-flies, as I call them. Flying one or two seasons before they are pushed out or swallowed by the big shark. Looking for ways to cut cost, and as we thought about a sustainable operation, the extended way of the U.N. Sustainability Development Goals, we developed the business cases for truly sustainable aviation. Focused on fair income for the employees (that we refuse to call “human resources”), housing, food, transport and ground mobility, health… Yes, completely outside the box, but all contributing to the profitability.

Worshiping the Golden CalfWhile we now suffer from decades of management misconception that everything must be subordinate to (quick) financial profit and that profits justify the means, we now start to recognize that “sustainability” must be a “shareholder’s value”, as long as “long-term success” (viability). My friends and audience do know I questioned the pure financially focused “shareholder value” for the past 25 years at minimum. And as an economist by “original” profession, I question all those dreamworld models that burn money in the next big hype.

That said, aside our idea on Green SynFuel for aviation, as we though outside the box, what are other ideas I recommend investing in. Admittedly, ideas we plan to reinvest on our own journey to establish what shall become a truly carbon-neutral airline within ten years.

Circular Economy

Circular EconomyOne of the abused topics is Circular Economy, which Wikipedia defines as “a model of production and consumption, which involves reusing, repairing, […] refurbishing and recycling existing materials and products as long as possible.” While I find Wikipedia already distracting from the core of the case, the image they show is quite on the point. Whatever you use, must come from sustainable sources, and after being used must return into a state it can be reused for the same product.

Looking at plastics, 95% of the recycling in reality is downcycling! Or export. Or local landfills. Or incineration. Or – and quite a lot – ending up polluting the oceans and landscapes. But downcycling ain’t circular but add to disposal and pollution!

e-mobility Life Cycle Assessment Greenwashing Volkswagen AGIn a discussion group on Circular Economy and the Agenda 2030 organized by U.N., the focus was directed to the LifeCycle Assessment (LCA). In which i.e. Volkswagen came to rather devastating results for their ID3. The life-cycle of one of their ID3 electric “Golf” is not substantially better than the Diesel, worse if you consider the German grid-energy mix and not the more favorable (beautified) European one. It’s considered a direct consequence when United Nations Secretary General António Guterres ahead of COP26 blames: “Far too little, far too late“.

Vertical Farming

Indoor Vertical FarmingGiven the current droughts and considering circular economy, thinking about greenhouses filling entire regions in Spain, I think we will need to invest into vertical farming. Given a “closed system” to improve the water usage. Reduce use of chemical fertilizers, herbicides and pesticides. Discussing with a startup recently, I was surprised on the efforts on seed sequence. Not for the plant or the soil, but to make sure the bees they use at all times find sufficient nectar.

They are experimenting with water conservation and are able to provide a quality way better than “bio”. And it’s not just salad, but potatoes, tomatoes, cucumbers, broccoli, corn, you name it, they grow it. And they are testing apples, grapes, and other vegetables too. And they are using moving trays, from seedling at one end, to harvesting on the other.

The few remains they can’t reuse go into high quality compost for the plants that still require soil – there is no downcycling, it’s just that they use pure nutrients without soil wherever they can.

Desalination – Hydrogen – SynFuel … i.e. in the UAE

Last year, there was an article by the World Economic Forum about the UAE strategy on “extended” Hydrogen, reflecting about 1:1 on my, since 2008 frequently shared opinion that hydrogen is a natural successor to fossils in the expanded tropical belt. I strongly recommend reading!

Hydrogen powered Wing in GroundGiven our work in 2008 on the hydrogen-powered WIG, a “wing-in-ground”, an “airplane” that uses the “ground-effect” for smaller wing-size and improved performance, we were told the idea would be perfect for the tropical belt. As those WIGs “fly” in five to ten meters above ground, water is perfect for them. But even more important, the use of seawater allows to develop a salination. The sweetwater can to a large extend be used for the population. Naturally, before desalination the seawater is being cleaned. Then the salt from the desalination process is used to increase the salination levels of more seawater. That salinated seawater is then used for the electrolysis.

Operating in the “extended tropical belt” and seaside, the availability of wind and water for the “green” process is very safe.

World Climate Zones

Sure, this was a very steep learning curve. It triggered my understanding that carbon-neutral transport is not just imaginable. It’s feasible. And many of those ideas, applied to our ideas for Kolibri made and make it possible for me to develop a plan that makes it possible to use a body like Kolibri to make it fly carbon-neutral within 10 years (even less, given the right support). Saving a mere 2 Gigatons of CO2. Not by then, but by then every year!

The Four Columns for Happy Living

United Nations defined the four columns as the foundation for people to be happy as:

  1. Shelter
  2. Food
  3. Health and
  4. Safety

That naturally includes the families, something often ignored. Or is identified as “salaries”, hiding behind “politics” resulting often in the inability to secure the above columns. And did you know that those are a growing problem even in the so mighty “industrial world”?

Learning From the Military

Noone is left behind
Noone is left behind

Ndrec and I are both having a military background. While Ndrec was a career officer in the Albanian military, I grew up in a U.S. garrison town in Germany with their families.
In the military, while you are there, everything is taken care of. Aside a salary the soldiers can use for surplus luxuries.

Quite similar, in the last centuries, many companies developed housing and even just 35 years ago, I’ve stayed in an American Airlines-owned residence.  All larger airports have own cantinas for the airport employees and “external” airport workers.

Precarious Working Conditions

Most companies pay a “competitive salary”, but increasingly, those competitive salaries do no longer cover the most basic needs of people. That is especially true for families with children. “In 2020, there were 96.5 million people in the EU at risk of poverty or social exclusion, representing 21.9% of the population.” [Source] But while EU highlights progress on SDG1 (no poverty), even for industrial leader Germany reports show a growing poverty with wealth increasingly piling up with the rich 10%, owning currently 56.1% of it, the top 1 % holding about 18% of all wealth, as much as 75% of the population owns. More than 60% “own” less than 5% of the wealth, while 20% are being in debt! And those numbers are growing.

Those numbers are looking even bleaker on a European level!

#Greenwashing and #Raisinpicking

Greenwashing Demon (shutterstock_1170455851)

While the SDG funding gap grows at an alarming speed, poverty rises at alarming levels in Europe, there is an entire industry of greenwashing impact investors out there, using raisin-picking creatively to greenwash their investments. But there are 17 SDGS. And the possibility to do aa life-cycle assessment.

And as referred to before, two simple question disqualifies many, if not most of those “impact investments”: What is the energy bill and where does the energy come from? Is carbon-certificate-trading used to paint the idea green? Investments needing carbon certificates to go green are unsustainable themselves, selling their indulgences by buying what good others do. If you buy into grid energy, use grid-energy shares. Only if you have your own plans for energy source (solar and wind parks, etc.) you can calculate.

Primary Energy Demand vs. CO2

Our growing energy demand causes directly rising CO2-levels. The graph is already a bit older, but the statistics are showing that the short improvements during the global pandemic have already recovered and the rising energy demand in Europe is in line with the CO2-rise.

And do you claim climate action but pay no attention to your staff (and their families) happiness in form of sustainable salaries? Delivery services claim their “riders” deliver “green” using bicycles. Whereas it is commonly known that those very riders usually work in precarious working conditions! Same for Uber and other “investors’ darlings”.

Earth Overshoot Day 1971-2022Earth Overshoot Day

Did you know the Earth Overshoot Day after a very brief respite 2020 fell back again in 2021 and 2022? So what are your plans on using resources?

And did you know that “sand” is a resource in short supply? As is clean drinking water!

There is a frightening map on OvershootDay.org on the countries that use more resources than they have and there individual overshoot days. The U.S. overshot by March 13 already! Germany May 4th. All European countries overshoot in the first half year, so they use more than two Earths resources.

Timeline + Scale

EU climate plansThere are many investments into small-scale change, with a focus on two to three years. That by itself should be an issue of concern for any real impact investor. As for climate change and sustainability that can only be a start. What is the 10 year outlook? What impact will it make by 2050?

What is the impact on which SDGs? The United Nations Sustainable Development Goals! Precarious jobs are clearly a negative impact on the SDG1 and ripple also into the other SDGs. A negative energy balance naturally impacts climate. SDG7 and SDG13 are related, as are all the other SDGs!

Sustainability is a generation challenge! To turn around our abuse of global resources back to a sustainable level. Conserve energy. All that with as little impact as possible to the luxuries of the decision makers? Having grown up in the 70s, that was the time this all started. And my boss on the practical part of my economics studies questioned “price wars”. While there can always be someone cheaper, a good buyer considers the well-being of their supplier. And buying cheap from China comes with a price. His lessons resonate more than ever nowadays!

A Holistic Approach to the SDGS

Employee TrainingOne of the main concerns we are faced with at Kolibri is our approach to sustainability. First of all, why would an airline turn sustainable, it’s heresy, ain’t it? And why would we pay salaries above country average? Maybe, because they are sustainable and secure the people’s motivation and loyalty?

What about our plans for training, kitchens, real estate, residence parks, solar parks, transport? Can’t you shelve those (in the trash)? But we believe that if we right those wrongs, we will have a motivated and loyal work force. And ain’t that funny? All those “investments” are to be profitable too. As that is what we consider real impact investing. Do the right thing. With the right profit. As such, they are part of our 10 year strategy.

Kolibri 10-year outlook

So after 10 years, we don’t only save more than two gigatons CO2, per year that is by then, we will not just be a sustainability lighthouse, we will be not just profitable, but also disruptive. But only, if we get to #walkthetalk. Which means that we do find a real impact investor.

Food for Thought
Comments welcome!

Too Many Chiefs …

… and the Question about System Relevant Jobs

Managers vs. Executives

Today I had a very emotional discussion about the need for new IT, new processes and all that other stuff the consulting industry keeps telling us, we got to have. Consultants, that have a standing relation inside the aviation company, with constant projects to “improve” and streamline the work.

At what cost?

Having addressed Consulting, Outsourcing, Cloud? COTS or tailormade back in August 2020, we meanwhile discussed over and again the issue of “System Relevant Jobs”. Back in my economics studies, 40 years ago, the general manager of my intern company questioned the increasing “management jobs” by academics, reminding, emphasizing that in the end, it is all about products. Even in whole sale (it was a central logistics warehouse) it’d be a question about benefit for seller and buyer, where the warehouse we worked in distributed the goods to the own satellite stores. He warned, that every intermediary becomes a leech and products becoming more expensive, not cheaper, by adding more and more intermediaries into the pool. His assumption was that 50% management surplus would be viable. And I should mention that he warned about dependencies from “rogue countries”, like China. Cheap but at what cost?

Being very pro globalization in general, he did call it hypocrisy to buy cheap in China, knowing that this is simply based on abuse of work force and stealing of patents and other ideas from other countries – back in the days, China did not much invent themselves, they were known copycats. In Germany meanwhile called “precarious jobs”, that don’t provide decent living, the living standards of workers in China at the time were at best questionable.

System Relevant Jobs

System RelevanceIs your job “system relevant”? If you work in home office, I can tell you the answer is No. If you work in consulting, I can very likely tell you the answer being No. Working in aviation and transport, the answer very likely is No. And if your salary is above average, the answer also very likely is No.

It’s all about leeches. Draining the money out of the really system relevant people, who normally are overworked, but underpaid. Not on the picture are farmers, friends of the family farming, living since I grew up on the brink of bankruptcies over and again. With more and more demands and pay for their products (milk, meat, grain, etc.) being often below the cost of production. Then they get generously state aid, to keep them working on subsistence levels.

The NHS personnel is on strike, the medical situation there in the U.K., also in Germany, being devastating. 24 hour shifts, 3 days “on call” duty?

Logistics drivers, the one delivering all those fancy goods we all buy, paid at minimum wage or just very little above for good feeling? Uber being a gigacorn? Delivery “Heroes”? But the managers in their offices having a “decent salary”? Who’s doing the work and what do we pay them?

U.N. Sustainable Development Goals

The United Nations Sustainable Development Goals

There are 17 SDGs. But all statistics show that all of them are actually still deteriorating. And if companies call themselves “sustainable”, they usually focus on the easy SDGs, most times at the cost of the others. Yes, we invest into climate, we buy CO2-certificates. And buy our growing hunger for power from the grid. Sure we buy “green power”… We upgrade our HR Director to “Chief HR Officer” and call it a board position, but only on paper to look good. We invest in R&D to find solutions how we can become sustainable in the future, while we fight the unions and deny salary increases for our workers. We add the (female) position of Chief Sustainability Officer to express our commitment to the SDGs. Oops, we forgot to give her a budget or empower her responsibilities? Examples aplenty…

We need companies to do the right thing. To embrace sustainability and evolve. It’d give them a competitive edge, a USP. When I was a child, it was common that people worked for “Daimler” (Mercedes-Benz) or “Bosch” all their live. You looked after your stuff from post-school training to retirement – often even beyond. Then they became “Human Resources” to managers who turned “shareholder value” from “what’s good for the company” and “long-term thinking” into “what’s good for my bonus” and “who cares about the time after I’m gone”.

A Question of Respect

My “intern” boss (again) taught me respect for everyone. The guy on the fork-lift, the cleaners, truck drivers and “secretaries” (yeah, we still had those). He taught us to set up the coffee when it was empty and not bother the secretaries. To clean up ourselves to make the cleaners’ jobs easier. To think beyond our petty box as “office workers” and value the hard work of the real workers. Also to question, but then also embrace the value of our work. IF we added value.

And in the pandemic, we should have (but obviously didn’t) learn the other lesson. That it’s not enough to sit at the windows “applauding” the system relevant workers that went above and beyond any perceivable “line of duty”, but to pay them decently. To look after them and keep in mind that they also have families to sustain, vacation wishes that go beyond the balcony on an old residential block they only can afford with added state aid.

Beyond White- and Greenwashing

I recently attended a multi-week project by United Nations Climate Action on Circular Economy. And the need for lifecycle-assessment. But it was also mostly #talkthetalk and academic ideas. And I had several objectives that then led to my image about the panacea distraction.

Aside me wondering, of that lady in the image might be an unpaid intern? Another reflection of the value HR managers and their bosses have about the value of training and labor. Any employer not paying their interns should be put in the pillory. For labor abuse!

Oh yes, and that goes in line with midwifes that quit their jobs as governments don’t reduce but add to the legal strains in the job. Or riders asked to bring their own bikes – and repair, all at minimum wage and abusive “time management”. Or airlines outsourcing their pilots forcing them into bogus self-employment without vacation or sick-leave cover, paid wages below their own pilots. Back in my intern-days, there were “personnel agencies” too. But to hire someone for short-term was always about 50% higher cost than employing someone directly. What went wrong there?

Yes I could go on.

Food for Thought
Comments welcome!

Yes. Comments welcome: Do you agree, disagree, partially, am I right, wrong, do I oversee anything? Have your own examples? What would, could and should we do?

 

Kolibri LinkedIn Posts and Images

Having recently worked out new promotion images to attract investors for Kolibri and shared them on LinkedIn, the halftime for the attention about LinkedIn articles sure is very short. So Mike asked me why I wouldn’t put them in the blog. So here you go. I think you see the development from 14 to 16 October?

14 October: On Kolibri Profitability

Got asked about Kolibri profitability. We intend to start with min. 4 and up to 21 aircraft (higher initial investment = less overhead cost per aircraft, more routes = lower risk). More than 200 a/c year 10.

Roughly serving more than 65 million passengers a year, sustainably employing more than 20,000 people, creating more than 60,000 other jobs in Europe. A #highlyprofitable #billioneurobusiness if you avoid the common mistakes.

THAT is #industrialscale … and needed for a #holisticapproach to the #sustainabledevelopmentgoals (#noraisinpicking) and make #climateneutralflying a profitable reality!

Or as Aradhana Khowala says: Whatever you think. Think BIGGER!

And as I keep saying. If you want to be a #profitableairline manager, #thinkoutsidethebox. Way outside the box. The same if you want to launch a profitable lighthouse airline to fly climate-neutral within a decade.

If you know of #investors seeking to #kickstartfund the next highly profitable, sustainable #industrydisruptor and a #climategigacorn – we’re happy to help! #impactinvesting #impactinvestor #familyoffices #venturecapital #privateequity

15. October: Heresy!

Sit back and sulk. Or help us funding the set up Kolibri, a profitable, large airline to connect Europe climate-neutral within the decade!

Heresy. Aviation ain't profitable - and the world is FLAT

16. October: Kickstart

And all we need is a serious kickstart investment …
#walkthetalk #beyondlipservices #gigacorn #pleaseshare #climateneutralaviaiton #climateactionnow #impactinvestors #familyoffices #venturecapital #privateequity #unsdgs #agenda2030 #returnoninvestment #minimizedrisk #maximizedcrisisresilience #usps #disruptor #industrydisruptor #doingtherightthing

Kolibri 10-year outlook

 

Is it all Greenwashing and Talk-the-Talk?

Go Carbon-Neutral This Decade

Looking at the past two years struggling to find investors for Kolibri, to change aviation and develop the proof-of-concept for carbon-neutral aviation, meeting with impact investors, family office principals, venture capitalists and others, European, Arabic, North American and even Asia resulted in quite some disillusioning.

Two lessons learned.

Lesson 1: It’s All About Energy

Primary Energy Demand vs. CO2If. If we really want to stop global warming, it boils down to reduce our energy demand. On a global level. But the reality is quite opposite.

While the current clash with Russia should be another wake-up call, it just proves that and how far we are from saving energy. From removing our energy footprint. Instead our leaders travel the world buying fracking-gas, crude oil and “natural” gas (from crude) to feed the ongoing hunger. We can’t expand “sustainable energy” fast enough, to reduce, less to replace all the oil, coal and gas we consume for our energy hunger. And building windparks, water-power-plants, solar parks also comes with a toll. One we have no idea yet on how to avoid the negative repercussions to our world. Which I i.e. addressed last year in my question about Wind Parks and the Butterfly Effect and the fixed page on The Sustainability-Energy Dilemma

The United Nations Sustainable Development Goals

If we use more energy to solve any of the famous United Nations Sustainable Development Goals, it’ll be a barrel burst! If we go for electric cars, is that more than putting a band aid on a purulent wound? Are the developments about electric flight or hydrogen aircraft anything more than delaying tactics by our industry to justify their lousy 2%-blending goal? Look at my whitepaper about #greenwashing if you want to find more examples.

emobility-hydrogen-greenwashing

Lesson 2: The Reality Behind Impact Investing

Now my litmus test to distinguish real sustainable investing from #greenwashing is simple: What is the Net Energy Impact? And yes. I’m kind’a sorry… But that includes many, if not most of those fancy “green tech solutions”. They are nothing but another distraction keeping us from the real challenge. And an excuse from governments and investors alike to avoid the real, industrial scale change we truly need!

ESGGreenwashing: Putting Lipsticks on Pigs

Also known as #talkthetalk …

Call for Action

Kolibri UNSDGPart I: To investors: We are slowly running out of money on our plans for Kolibri. We have succeeded due diligences. We have a holistic approach covering the U.N. SDGs. And we plan to reach break-even within one, be profitable in three years. And to benefit from the “new normal” enforced by Corona and the Invasion of the Ukraine. But to do this we need a sizeable launch-funding and our ideas to establish the technology to fly Carbon-neutral is even more expensive. It ain’t cheap to turn an airline carbon-neutral, but it is possible! So there are three steps. Step 1: Launch a profitable new regional airline with competitive cost-levels to stand out in the shark-pond. Step 2. Expand to lower the cost and generate the revenue to fund Step 3: Establish the infrastructure to turn carbon-neutral … and our ideas for a truly sustainable airline – beyond climate.

If it’s not you, we need commitment to help us secure the funding. Less #talkthetalk

Part II: To All: And for you personally? We as a family reduced our energy consumption by 10% last year. Despite all that modern household-tech, home-office and other energy consumers. What’s your saving?

Man in the Mirror [Michael Jackson]

Food for Thought
Help welcome!

The e-Mobility Lie

This weekend German ZDF’s planetⓔ released a documentary about the electric car myth subtitled revolution or barrel burst. In addition, there was an emphatic discussion about hydrogen and mobility on LinkedIn, with very noisy advocates for e-Mobility. So I just wanted to summarize from the documentary some findings that are quite in line with my understanding of the Sustainability-Energy Dilemma and the Road to Climate-Friendly Transportation (beyond flying). And why I consider e-Mobility a lie.

Don’t get me wrong. We need e-Mobility. No better solution for a household with  solar panels on the roof, a battery buffer and a range-demand that allows them to rely on the car. But.

Issue 1: The Batteries

Batterie Raw Materials

National Geographic - Lithium MiningAs you may remember, I keep referring to this article by National Geographic on the devastating cost of Lithium Mining. Lithium being to date the most important component for batteries. And the replacements ain’t any better! In addition, they need some rare minerals, the prices of which are exploding. Guess the “impact” if we replace not just some 100 thousands but millions of cars by electric. We talk about 56 million cars having been produced in 2019 world-wide.

Experts already worriedly question the viability of battery-powered cars and the overly optimistic believe that the battery prices will continue to fall. China is reported to secure world-wide Lithium deposits, European car makers demanding governments to do the same! It just got to public attention recently on the U.S.’s retreat from Afghanistan (source-sample).

Safety

Tesla on FireAnother issue that slowly reaches the public is the issue of batteries catching fire. First major reports were on the Samsung Galaxy 7 catching fire, forcing i.e. an entire airplane evacuation. But searching the Internet, you find also more recent reports aplenty. Also the Boeing 787 experienced a problem with it’s battery catching fire (fortunately on the ground). Attributed by experts to the attempts to miniaturize and push up the battery capacity beyond their “safe margins”. The scientific term used to distract the public attention is Thermal Runaway

Electric Car Fire - CoolingWorse, recently despite their relative low numbers, electric cars are increasingly reported to catch fire. Some at first loading at a standard, approved home loading facility, others while driving. Different from gasoline, a thermal runaway and the resulting battery explosions cause a much higher real danger to the cars passengers. And it does not help to distinguish the fire, but such car must be placed into a water tank for several days to cool down the batteries. And after a fire, such cars usually are beyond any recycling. The picture just one example of the many that can be found on the Internet.

Recycling

eMobility Battery RecyclingIncorrect disposal of Li-ion batteries can have a devastating environmental impact on the environment, sparking the need for recycling (Source). But as the ZDF-report also questions, there is virtually no recycling yet and the recycling comes with a bunch of issues. Like non-standardized components and liability issues, that currently result in a very limited recycling. As mentioned in safety, those liability issues are expected to be quite an issue for anyone attempting recycling. And the missing standards resulting even in different battery packs within the model family of the car makers. Making it even harder to recycle them!

Issue 2: The Energy Consumption

Loading Infrastructure

Full eMobility Loading Stations
Oops. Sorry, all loading stations in use

Again, now today we have the loading stations for electric cars and they are not enough. With the family in “Car City” Braunschweig (Volkswagen), at our owned apartment, there neither are possibilities to load the cars, nor even nearby. Publicly accessible loading stations are usually for 1-2 cars. But what if all cars are electric. You simply got to be kidding, right?

I have personal reports from friends frustrated about their electric car about unavailable loading stations and long waiting times, but there are also many on the web, like this one. Now let’s imagine a parking house that must be equipped with electric vehicle charging stations for all cars? Then imagine, one of those cars catches fire from a thermal runaway…

And here we talk about an industry country like Germany. Now think about less privileged countries…?

Range and Refuel

The three biggest fears of our generationGerman Automotive Club ADAC just recently reported the average range of electric cars being about 350 km (220 miles), up from 250 km (150 miles) five years ago. Thinking about my role as an airline sales manager some years ago, for a road trip, I traveled frequently more than 500 km a day. Then I shall load the car after a half day, sitting around while waiting? Keep in mind, that corporate fleets and rental cars are the main buyers of new cars! And they don’t buy them because they park them most of the time…?

As mentioned before, then we talk about the loading infrastructure i.e. on highway truck stops. Just been stopping at one on one of the busiest German highways. With 8 lanes and 16 loading columns for fossil fuel, and two for electric cars. With two more already waiting in line.

It goes very much in line with the 3 biggest fears of our generation and the Sustainability-Energy Dilemma… Just in case you’re wondering why people still buy (and rent) mostly gasoline-powered cars.

Power Consumption

Power from the Plug GreenwashingThe new Volkswagen ID.4 uses 22.8 kWh per 100 km (Source ADAC). Considering a “typical” average range for a car of 10-15,000 km, we talk about 300 MWh/a. Given 48.2 million cars registered in Germany (German source), we would need about 15 Petawatthours (15,000 TWh/a) one year alone. Any green energy source for that? Germany used 545 TWh/a in 2020… In 2020, about 252 TWh/a were produced from “alternative sources” (aka. green). That would be enough for the power requirement for about 850,000  electric cars…? Reminder, there are 48 million cars roaming German streets.

And sure, all that power comes from the Jack. And sure, it’s all green? Just like German Rail.

The CO2-Saving Lie

Volkswagen ID.3 Life Cycle AssesmentLooking at Volkswagen’s own Life-Cycle Assessment, planetⓔ just compared the CO2 on a single car. And how they used a European basis to lower their CO2 impact, instead of using the German statistics, where the impact is worse than on a normal Diesel. So planetⓔ also understand that in order to reduce CO2 is an energy-challenge, we must reduce the energy consumption, all else is blissful ignorance, cognitive dissonance or simply an outright lie!

The e-Mobility Lie

Change Resistance (shutterstock_210479080 licensed)Like I found on the research for the Sustainability-Energy Dilemma, we must look at the complete picture. Taking a look at some 50 million cars, which is excluding trucks, at 30 tons CO2 on a 15 year life cycle we talk about 2 tons a year per car. Or 100 million tons of CO2 just in Germany. Make your own maths on Europe or the World.

So to make electric cars “sustainable”, green energy is needed. Which takes us back to the Sustainability-Energy Dilemma. And it confirms my opinion that while we must turn aviation climate friendly and start n.o.w.! There are a lot of other areas that all boil back to the Sustainability-Energy Dilemma. Good ideas mentioned by planetⓔ at the end of the report were needs to rethink transportation. The need to reduce the number of cars. Car sharing, better public mass transport systems, etc., etc. And to develop integrated transportation that works for both, the major cities everyone uses as the role model, but also the rural regions.

The Necessity for a Holistic View

outside-inAs I mentioned in my post about Flygskam, we have a very … strange? … view on aviation. As on sustainability. And I hope that journalists like planetⓔ, real impact investors and family office principals interested in real impact start more questioning those views. Stop “airline bashing” as addressed in Flygskam, stop worshipping the golden calf of e-Mobility and understand that we don’t have the luxury to do this or that, but that we need this and that!

Ready Player OneReady Player One? I love SciFi. There’s a lot really good ideas how we could merge individual transportation needs with “public” transportation. But that’s SciFi. We need to take the best ideas and evolve our transportation to sustainable ways in the real world. We must reduce energy. Integrate transport modes. Why does it remind me of the question why the big train stations are not at the airports? The “new” Berlin Airport being a perfectly bad example on this!

Greenwashing Demon (shutterstock_1170455851)
The Greeenwashing-Demon – it’s all about Electricity

But if we don’t solve the Sustainability-Energy Dilemma, if we don’t focus on ways to reduce energy, it’s all lip-services and greenwashing! And if you know investors who are interested to address this on an industrial scale and make real impact while making profit, I have a lot of ideas. Including profitable plans for myself and my industry, turning aviation environmentally friendly. But that’s only my part of the big picture. Though it covers already many complementary ideas we want to realize in other areas.

Food for Thought!
Comments welcome…

Sustainability and Time vs. ESG + Greenwashing

Today, two articles triggered with me, quite in line with my experience about ESG greenwashing and priorities and my impression that thinking about sustainability and the busted Paris agreement! There is no “Planet B”!

What the Others Say

The Tasks at the End of the Road
© Lucas Varela/Financial Times

The first article a LinkedIn-post by Satish Bapat referred to. A Financial Times article (FT*) by Oliver Burkeman considers how we burn up our time, how emptying the e-Mail inbox naturally refills it (from our responses), etc., etc. But how little time we truly have.

The second one was referred to in response to a LinkedIn-post by Harald Walkate on another article from FT Moral Money about the mislabeling of ESG. To which Alan Hayes commented with a link to a Bloomberg Article* about the U.S. SEC challenges companies for abuse of #greenwashing.

That triggered with a discussion at the recent GITA Unconference by Abdelrahman (Abdo) Wahba about the management of all the Marketing Bullshit (BS) we are confronted with (YouTube link). Which includes unfortunately more massive #greenwashing.

GITA Unconference

At the Unconference of the Green Impact Tech Alliance, I spoke about the Bumps on the Road to Sustainabilityspeaker notes, Youtube link and Channel). Summarizing my thoughts about why all those claims for carbon-neutral and energy-transition are bland lies and far from real. More in line with “wag the dog”, distracting from the real problem. An issue just in line with Abdo’s message that most of what we hear is “shit, packed in chocolate cake” and we should believe only half of what we see, half of what we hear. And apply a reality check before we believe all the BS.

If you are into sustainability (beyond aviation) and ESG, I strongly recommend you have a look! And yes, I’d much like to discuss it.

Assuming you know my page addressing The Sustainability-Energy Dilemma, it all boils down to Energy consumption. But while we need to make smarter energy use and reduce the overall energy consumption, this is a challenge I don’t yet see addressed at all. “Digital” will solve the climate challenge? Adding more and more data centers that account already for more than half the electricity in the Frankfurt region will solve the climate challenge? How??

IPCC: We Busted 1.5°, 2° will be Busted 2025

EU climate plansSo IPCC leaked that we busted our fancy climate goals already. As I do not believe that there will be enough change by 2025, looking at the crap our politicians, the industry and impact investors make us believe. Or as I also heard last week: We must stop talk-the-talk and start to walk-the walk!

It goes in line with my images in Bumps on the Road to Sustainability about the fancy idea to place big turbine generators into the Gulf Stream on the coast of Carolina (USA), with reports questioning if the Gulf Stream, so vital for European climate, will make it to Europe by the end of this century. Anyone remembers The Day after Tomorrow? I’m not as much worried about New York under an ice shelf, but what about Northern Europe?

ESG … Believe the Numbers …?

I think this time we got the numbers right ... we just don't know which ones to use.

Countless how often I have heard impact investors disqualifying the ESG goals as 99% #greenwashing. Attempting to establish Kolibri with the commitment to drive true carbon-neutral flying, we sure have all the other SDGs in mind too (there are 17). With mostly quantifiable targets. And beyond (Human Rights as they go beyond SDGs).

But this brings me to those articles about ESGs and green funds and pension funds turning green but investing still large scale in BlackRock (who also has funds for fossils and weapons industry). And to Abdelrahman (Abdo) Wahba’s discussion at GITA I referred to above:

Question The Numbers!

Most of them are just marketing.

Industrial Change

Power from the Plug GreenwashingWhile we see a lot of small investments into “green tech”, most of those don’t qualify for “sustainable investment”, neither “impact investment”. As they add to the energy consumption without much of a plan aside using carbon credits from the real green ones that struggle as they are not on the investor’s radar.

None of the investors – and I’ll be happy to be proven wrong – invests into real climate change and sustainability. The pick the easy-to-achieve raisins. Sustainable needs a holistic view. No raisin picking. Any investment, any business plan not having a document about how they want to address all SDGs, plus diversity, ethnicity, human rights, is #greenwashing.

Go Carbon-Neutral This DecadeTalk- the-Talk or Walk-the-Walk?

Given the example I daily work with: Kolibri. To achieve our goal of carbon-neutral flying, the technology is there. No, it doesn’t need new inventions. Just application of what we have. But the technology is one thing, the energy-conversion from fossil fuels to SynFuel is the real challenge. One we believe can be achieved in 10 years. If we walk-the-walk!

But wait a minute. While I am very sure, this is real impact investing, I was just told by an investor that such long-term does not qualify for ESG! ESG would not be about such future commitments, they require hard goals. Though burning green Synfuel instead more than a billion liters of fossil kerosene in 10 years ain’t a hard goal? Not according to their ESG-#greenwashing-tool…

Long-Term Planning: 2050 and beyond

What about the cargo fleets on the oceans, rivers, in the air and on the road? If ESG doesn’t have a way to set targets and adjust to plans, what is it really good for? Are “data centers” and “digital” part of the solution? Or more part of the problem? Don’t get me wrong, there are good IT projects that will make impact. But most are just more #greenwashing.

IPCC says we busted 1.5°C, also known as the Paris Agreement. We are to bust 2.0°C by 2025. And while aviation accounts for only a fraction of global warming, to change it seems to ambitious for impact investors. And politicians. Better to invest small and manageable and blend out the reality: #cognitivedissonance. Or outright lie.

Norsk e-Fuel a nice example disqualifying the EU’s talks.

Walk-the-Walk or Talk-the-Talk?

Food for Thought!
Comments welcome…

 

Foot Note:
* As FT and Blomberg often requires a subscription to view articles, I have a saved copy of the article on file for friends.

Compulsive Narrative Syndrome – SciFi or Reality?

Reading another, new SciFi (my way to relax my brain) triggered with an idea (not scientifically proven) of the Compulsive Narrative Syndrome. Intriguing. And yes, quite in line with my own “experience”. So is it really “Science Fiction”?

Ain’t that how it works? An assumption, then the scientific proof (or disqualification)? And how much that started in SciFi do we see in action today?

If you like SciFi, maybe you find Joel Shepherd an interesting addition to your books collection. If you read German, the first part of the series is currently on sale (i.e. buecher.de). And no, no profit from such recommendation.

The Concept

Here’s the way the concept is described in the novel:

Shepherd, Joel - 23 Years on Fire introducing the Compulsive Narrative Syndrome.The human brain is trained to look for and identify patterns, but in abstract concepts, fixed and unarguable facts are hard to find. So the brain looks for narratives instead, stories that can tie together various ideas and facts in a way that seems to make sense, to make a pattern. And the human brain, always seeking a pattern as a basic cognitive function, will latch onto a narrative pattern compulsively, and use that pattern as a framework within which to store new information, like a tradesman honing his skill, or someone learning a new language.

That’s why religions tell such great stories, the story makes a pattern within which everything makes sense. A synchronicity of apparent facts. Political ideologies, too. Humans are suckers for a great story because we can’t resist the logical pattern it contains.

When you’re learning a new skill, discarding irrelevant information and organizing the relevant stuff within that framework is good. But in ideologies, it means any information that doesn’t fit the ideological narrative is literally discarded, and won’t be remembered . . . which is why you can argue facts with ideologues and they’ll just ignore you. They’re not just being stubborn, their brains are literally structurally incapable of processing what they perceive as pattern-anomalous data.

That’s why some ideologues get so upset when you offer facts that don’t match their pattern, it’s like you’re assaulting them.

From SciFi to Reality

Most my “novel” ideas ain’t mine. I just try to find practical applications.

The concept of the Hyperlook has long ago been visualized by Roger Leloup.1971 (yes, 40 years ago and as a kid) I became a fan of Roger Leloup, spending my pocket money on comics. And when Hyperloop became a buzz, I couldn’t help it to remember Leloup’s Vinean transport system.

We all know the Star Trek communicator. Ain’t that surprising similar to our today’s smart phones? With Google Translate, we can even talk to it, translating on the fly – and as far as I can tell, even German or English to Albanian works rather well. Not (yet) on previously unknown languages, but I believe we will get there.

ASRA 2008 brainnodes vs. internet equals AIAnd the buzz-topic A.I.? Aside the fact that all A.I. I learn of still is just I.A. – more or mostly less sophisticated Intelligent Algorithms. Back in 2008 I used that image of global nodes next to human brain synapses to question if we’re sure there’s no real A.I. yet. And if we’d recognize if there would be? By now, we talk about highly complex processors behind all of those nodes, the sheer computing power making it more likely by the day that our mighty Internet “wakes up”. Then we talk about i.e. Heinlein and Malcolm Croft or Athena?

And now comes a new, quite intriguing concept of the Compulsive Narrative Syndrome. Just SciFi? Or quite realistic in fact?

And Kolibri?

Go Carbon-Neutral This DecadeI just recently discussed our ideas for sustainable aviation. They are not new either. And more like a logical development from my first ideas about a hydrogen-powered WIG in 2008 as a n example to senior airline managers to think about sustainability. Then making use of current developments and understanding the merits of SynFuel. And thanks to discussions with Sustainable Aero Lab (thanks Mario!) leading to my understanding of the Sustainability-Energy Dilemma. But it’s in line with Ndrec and my believe in “social responsibility” and “sustainability” … beyond climate!

But while yes, our ideas could be “copied”, it took us more than a year and a joined effort incorporating the help of global subject matter experts, to make this a viable business plan. Yes, it can be copied, but with a steep and expensive learning curve. And we found “classic aviation managers” to be mostly blind on real “sustainability”. Having no idea about their Road to Environment-Friendly Flying, not even bothering about Social Responsibility or Sustainability. It’s a reason we plan with a team of open minded subject matter experts and not some famous names, except as advisors. And why we don’t plan taken over an existing airline with their expensive and inflexible and traditional process and thinking heritage.

Industry Scale Impact Investing

Kolibri - disrupt aviationTo make a real change, you need a team of entrepreneurs thinking outside the box. Way outside the box. But with an experience on pioneering work, overcoming the Bumps on the Road to Sustainability, making things happen. Because to change an industry, to change aviation, we also need investors with the might and the interest to support us doing the change.

It’s a sorry fact that mostly we hear lip-services and excuses, those investors sticking to their modus operandi, just adding ESGs for their own little greenwashing projects and playing things “safe” (known), else still focusing on quick financial returns. Invest in a bit *tech, add to the energy-dilemma, but ignore any industrial-scale change? Ain’t that what the Compulsive Narrative Syndrome addresses?

While Impact Investment is about making an impact first, while also making money, we talk about turning industries climate-friendly and socially responsible. While our plans sure secure the (risk-adjusted) ROI, the plans are long-term, bold and the startup investment is to start the journey (launch the airline) but we plan on a realistic decade for our goal of carbon-neutral (climate-friendly) flying. With sustainable and social responsible milestones and investments from the outset.

Cognitive Dissonance and the Compulsive Narrative Syndrome

So is the Compulsive Narrative Syndrome a source for Cognitive Dissonance? In my opinion it’s tightly linked. The Compulsive Narrative Syndrome the source for Cognitive Dissonance?

Food for Thought!
comments welcome…—

So What Is YOUR Impact?

Discussing about the individual impact we make, the topic gains interest. What is your own, personal net-impact to our planet? So I decided to summarize some of the posts and comments I had on the topic on LinkedIn.

In line with previous posts about #lipservices, #cognitivedissonance and #wishfulthinking. And a #realitycheck for others, claiming “sustainability” that they do not deliver upon.

Self-Esteem over Sustainability

Bezos Musk Gates (c) CNBCA clear article on it was today’s post by SEDO-founder Tim Schumacher Search: “People should only be classed as billionaires when they remove a billion tons of CO2 from the atmosphere.” referring to the CNBC article questioning the sustainability investments of Jeff Bezos (Amazon), Elon Musk (Tesla, SpaceX) and Bill Gates (Microsoft founder).

In my comment, I emphasized that we need no ESG, but #sustainabilityaccounting. And much of what I see from these and other investors is showing their response to their conscience, focusing their activities on things they understand, but also things that have an impact to their self-esteem. And there was also this Open Letter to Bill Gates, reflecting on his #cognitivedissonance or #lipservices. I believe it’s simply cognitive dissonance. Keep in mind, these people also live in their social (media) bubble.

Role Models

Image Daily MailYesterday, there was a report about industry leader/face James Hogan, former CEO of Etihad, caught in the act, trying to circumvent the Corona rules in place. It underlined my post two weeks ago, that we have airlines skipping pre-flight corona-testing regime. A disservice to an industry trying very hard to make flying safe! I’m sure he regrets that idea now, not having considered the repercussions of being caught.

#cognitivedissonance: While flying itself may be safe, passengers aren’t! Anyone claiming flying to be “safe” shall better keep in mind that the virus spreads and new variants keep spreading by travelers. Also and a lot pre-tested passengers are infected but not yet positive, they then spread the virus in their destination.

#weareallinthistogether and the only safety I see in the vaccinations. And this ain’t the new measles I compared to early in the pandemic (May ’20), but more like the flu. A vaccination not available to everyone (yet). About which U.N. Secretary General António Guterres warns of #vaccinationalism. Also claiming the climate emergency. A caller in the dark?

The European Sustainability Bank

Then, let me talk about the decision makers at European Investment Bank (EIB). Claiming to be the European Sustainability Bank. In a conference by Geneva Macro Labs, I asked their head of climate office Elina Kamenitzer on her claim that they do green investments: Are there any success stories that proof the impact, the “impact” targets achieved ever since? Well, no. They “have to look into that now.” It’s about time.

Others are faster, but we have a PLANI also reached out to my now ex-point of contact in EIB, about a co-investment into our impact plans. With (a cheap) reference to their Roadmap and the decision there to not finance conventionally fueled aircraft (page 102), he disqualified any investments into aviation. In utter ignorance of what I believe he understood (I did remind him), that we have plans that are not aircraft-funding related. But i.e. development into a synfuel-ecosphere. Our plans cover all of the 17 SDGs, mostly with quantifiable targets that we sure plan to exceed on. If you’re convinced to do the right thing, that comes as a natural.

But that ain’t what the bureaucrats at EIB look at, is it?

So back to the article topic:

What is Your Impact?

Impact InvestingThere is a petition against greenwashing on Change.org I urge you to sign! Discussing on that one, we had several discussions on how to define greenwashing. Whereas family office principals told me ESG would be the role model for greenwashing. A good idea, meanwhile abused. There may be some investors who understand the meaning of it. But not many.

It is the same about claims to be “sustainable”. Another family office principal told me, that out of the 2020 impact investments, only 4% were having clear impact to improve on SDGs. 96% were disqualified as they just claimed without goals and targets but simple claims misreading the causes. Nice if you plan SDG5 Gender Equality on your hiring process, but without clear targets on how to improve. Or if you abuse SDG9 Industry, Innovation and Infrastructure for your “innovative IT project”.

Only Net Impact is Real Impact

We came to the conclusion that real impact is about net impact. And that “impact” is about reduction of the strain we put on the planet. To reduce power consumption by 10% but planning to increase the total power needs by 30% is intentional abuse of the sustainability claim.

There are many good examples out there, beyond what we plan at Kolibri. But we speak a lot with investors that want to cash-in on us before we launched. And investors, investing little money into small projects, more like a philanthropy, but an impact investment. Paying for a clean conscience, paying for their other daily sins. I just told one of the family office principals. We are looking not for those classic investors. We are targeting the family office space, as there are more investors than elsewhere wo take sustainability to heart. Who focus on it. Who are understanding that an impact investment might not be as profitable as i.e. Bitcoin. But it’s the right thing to do. And

Impact Investment ain’t philanthropy. Do good and make money!

So this time, not just Food for Thought, but a clear question:

What is Your Impact?

Feedback welcome…