Are Floating Incubators a Precursor to Floating Countries?

by | Dec 9, 2011 | Business Trends

Thomas Frey Futurist Speaker are floating incubators a precursor to floating countries?
Between 1990 and 2005, immigrants created 25% of all the publicly traded companies in the U.S. These included some of our best-known businesses such as Intel, Sun, eBay, Yahoo, and Google. This same group of foreign nationals went on to become the inventors behind 25% of all patents filed in U.S. in 2006.

Ever since the World Trade Center bombing, the U.S. has been tightening the screws on immigration policy. So much so that securing work visas for the thousands of foreign-born engineers and thinkers that U.S. companies desperately need for them to conduct business has become a serious impediment. Many fledgling companies simply can’t afford the effort.

Problems like this are screaming for a solution and a new startup called Blueseed, founded by Max Marty and Dario Mutabdzija, may have a solution.

Blueseed, now funded by PayPal founder Peter Thiel, proposes to create visa-free floating work villages in international waters, with the first to be located within helicopter distance of Silicon Valley.

So will this ingenious plan to circumvent U.S. immigration policy lead to more policy tampering and eventually an erosion of the power of nations? Here are a few possible scenarios that are sure to surprise you.

Illegal Immigrants Vs. Talent-Deprived Businesses

The mismatch between what U.S. colleges and universities are producing and the skills and talent needed by American corporations has been growing rapidly out of balance.

While the rest of the nation has been suffering from high levels of unemployment, companies in the tech sector have been hard pressed to find the talent they need. In 2007 this problem that was reaching a crisis point when Microsoft decided to open a facility in Vancouver, BC to take advantage of the less-onerous Canadian immigration policies. Vancouver was selected because of its drivable close proximity to Microsoft’s headquarters in Redmond, WA.

This facility is expected to grow to over 5,000 employees, comprised mainly of non-American workers, as an overt attempt to circumvent the increasingly restrictive U.S. policy for handing out work visas.

The U.S. is a nation built by immigrants, and it has been the pooling of cultures and combined thinking from people around the world that has made this a great nation. At the same time, immigration doesn’t work well if we simply open the floodgates. So whenever demand exceeds supply, we see natural friction points develop around the edges.

At the same time businesses are clambering for more immigrants, law enforcement officials dealing with the seedy underbelly of the criminal world are wanting tighter restrictions.

It is precisely for this reason that a tightly controlled staging area like Blueseed may prove to be the wisdom-of-Solomon needed to solve this dilemma.

Thomas Frey Futurist Speaker András Gyõrfi winning design for the 2009 Seasteading competition

András Gyõrfi winning design for the 2009 Seasteading competition


Seasteading, an idea first advanced by Ken Neumeyer in his 1981 book “Sailing the Farm,” is the concept of creating permanent homes and communities at sea, called seasteads. These would exist in international waters, outside the 12-mile limits claimed by most nations.

In 2008, Wayne Gramlich and Patri Friedman founded the Seasteading Institute, an organization whose primary focus was to establish autonomous, mobile communities on ocean-based platforms in international waters.

The project picked up steam in 2008 when Peter Thiel invested $500,000 and became a vocal spokesman for the institute, most recently with his essay “The Education of a Libertarian.”

In 2009, the Seasteading Institute hosted a global 3D design competition and received 41 entries with the top award going to Hungarian designer András Gyõrfi. The Seasteading concepts tied to the 3D illustrations were so captivating that major media outlets, such as National Geographic, Archiworld, and Bloomberg Markets heightened people’s attention around the world.

Thomas Frey Futurist Speaker Palm Island off the coast of Dubai

Palm Island off the coast of Dubai

Micronations on Man-Made Islands

In 2007 I began working on a similar project for forming micronations on man-made islands.

At the time, Dubai was receiving considerable attention for their cutting edge island-building technology. The creative approach used to build Palm Island along with plans for four others, Palm Jumeirah, the Palm Jebel Ali, Palm Deira, and The World, became an inspiration to other countries such as Bahrain, Thailand, and the Netherlands where new islands also began springing to life.

Countries in the Middle East have a distinct advantage when it comes to island-building because the Persian Gulf is a far more stable body of water than any of the major oceans.

In November 2008, my keynote at the “Leaders in Dubai Conference” centered on the concept of building islands, and rather than selling them as real estate, to sell them as autonomous countries.

An article on this topic written for The Futurist Magazine in 2009 can be seen here.

Let’s face it. Who doesn’t want to own their own country? If this were an option, I would venture to say that the secret desire to own their own country would rank at the top of most people’s list.

Blueseed founders Max Marty and Dario Mutabdzija both worked on the Seasteading project before branching off onto their own.

Within the next year, they hope to raise a venture capital round that will give them sufficient money to lease or buy a ship large enough to create a working community for around a thousand workers. If they are successful, it will not only open up Silicon Valley to a broader range of entrepreneurs, it will also draw international attention to the barriers American law places in the way of immigrants seeking to start businesses in the United States.

Even though Blueseed’s efforts to overcome the limitations of American immigration law should be applauded, its business model also depends heavily on the goodwill of American immigration officials. A major component of the Blueseed sales pitch is that residents will be able to make regular trips into the Bay area.

While there’s an annual cap on the number of H1-B visas available for American employers to hire skilled immigrant workers, permission to travel to the United States for business or tourism reasons is much easier to get.

Blueseed ferry service to the mainland

Currently they have plans for regular ferry service between the ship and the Bay area. While Blueseed residents would need to do their actual work—such as writing code—on the ship, Marty envisions them making regular trips to Silicon Valley to meet with clients, investors, and business partners.

With the ship only 12 miles offshore, it should be practical to make a day trip to the mainland and return in the evening, although B-1 visas also allow for overnight stays.

Blueseed’s research has uncovered that across America over 7,000 Computer Science Master’s and PhD graduates each year are foreign nationals. With current immigration policies, many of these 7,000 highly talented people will have difficulty continuing to stay in the U.S. and a high percentage will be forced to return home.

Blueseed has also signed up a number of advisors in matters of admiralty law, immigration law, and maritime operations.

Small island, or a new micronation waiting to be formed?

First Steps

According to founder Max Marty, “Blueseed is starting by conducting an environmental impact study. Once completed, we will need to acquire or lease a large ship. Then we’ll need to retrofit it for use as a floating apartment and office complex. We’ll need to hire a crew with a variety of skills—cooks, doctors, psychologists, lawyers, security officers, and many more. We are planning for a crew consisting of 200-300 members in total.”

Internet service will be essential. They’re still researching options, but the tentative plan is for a high-speed fixed wireless connection with a satellite backup.

Next they’ll need to find paying customers. Marty envisions the Blueseed ship as a floating incubator. They’ll charge rent, but also take a small equity stake in each startup that comes on board. He hopes to cultivate a network of investors to help identify promising entrepreneurs.

Most of Blueseed’s income will come from charging rent – $1,200 per month for the smallest rooms to $3,000 for the largest. These are figures similar to what other professionals are paying for an apartment and office in Silicon Valley.

Primary Elements to Consider

Projects like Blueseed always start out with the best of intentions but have a way of becoming marginalized over time by influence and personal interests. For this reason they need to achieve a delicate balance between what’s right for the business, what’s right for the community, and what’s right for their relationship with the host nation.

Below are eight primary elements that ventures such as Blueseed will need to keep in mind as they move further through the planning process:

1. Host Nation Relationship – Even though the operation is located in international waters, the relationship forged with the host nation will be crucial. Never under estimate a country’s ability or willingness to shut down an operation like this on a whim.

2. Symbiotic Benefit – Blueseed is creating a win-win relationship with U.S. based companies. When that type of relationship is achieved, the host nation can become a huge ally.

3. Built-in Economy – Ships are expensive to build and operate. Unless the operation is making a sustainable income or has an extremely wealthy benefactor, the costs will begin to cannibalize the operation into a death spiral.

4. Noble Purpose – Operations need to be based on a cause or purpose that people generally have respect for. A Blueseed-like operation formed for the purpose of tax evasion, slave trade, pirate Internet, or for dealing drugs will be doomed to fail.

5. Neutral Ground – One of the most compelling aspects of having an outpost in international waters is that it can be free of legacy systems and legacy influence. Decisions can be made without bowing to special interests. This, of course, becomes eroded every time a contract is signed, or treaty inked, but it is still a valuable asset that shouldn’t be overlooked.

6. Reduced Legal Environment – Even though the rules of business transcend national boundaries, most businesses will be able to operate with considerably more freedom without having to constantly check some manual for possible code violations.

7. Sufficiently Scaled – Projects like this need to be large enough to house a vibrant economy and at the same time large enough to care for the social welfare of the inhabitants. In general, the larger the operation, the greater the autonomy and less dependent it will be on the host nation.

8. Portability – As with the cruise ship industry, when one market dries up, it will be very easy to move the ship to another port. Floating incubators are easily transportable, so in case the relationship with the host city/country began to sour, they can always move to a new location.

Thomas Frey Futurist Speaker Will your next job offer a clear view of the ocean?
Will your next job offer a clear view of the ocean?

Future Scenarios

With these thoughts in mind, I’ve put together six brief scenarios to help expand your thinking.

Scenario #1 – Large Scale Adoption: Our first scenario would see large-scale adoption of the incubator concept with Blueseed-like vessels parked off the east and west coast of several major U.S. cities, along with others located in the Mediterranean as well as in the oceans by Japan, Korea, China, Britain, and Germany. With the fickle nature of immigration policy, this is unlikely unless operators can prove a serious economic advantage for doing so such as highly talented individuals willing to work for minimal wages or offering otherwise illegal research or service offerings that are highly profitable.

As an incubator, startups will invariably want to take advantage of business opportunities that are outside the bounds of what could be conducted inside most countries. Depending on the severity of the infraction, host countries may or may not decide to look the other way.

Scenario #2 – Experimental Nation State: A floating ship, much like an ungoverned territory is a blank slate that lends itself to experimentation and the testing of new ideas. The operating system for the world today is composed of a series of intertwined, complex legal systems. Some, like trade agreements and treaties, are global in nature while others are specific to an individual country or region. People generally don’t want to live without some form of legal, law-based protection. In a democratic society, however, laws can move much slower than technological know-how and can have a stifling effect on innovation. This is part of the reason large corporations shop the globe for the best regulatory environment in which to conduct their operations and research. An autonomous floating community with no existing structures, or government, becomes a perfect laboratory for experimentation.

Scenario #3 – Staging Area for Work Visas: Many companies will be willing to pay considerable sums to attract the right talent. With the right policy changes, a floating community could serve as work-staging area for people seeking work visas. Perhaps one approach would be for the sponsoring company to post a bond that could be drawn upon to cover all of the costs associated with deportation if that becomes necessary.

Scenario #4 – Floating Embassies: In port cities it may be easier to maintain a secure setting for a foreign embassy, and its diplomatic mission, if it were located offshore. Maintaining ties and relationships inside a volatile community when an uprising may have recently occurred may be a challenge. Moving into a floating embassy may solve some of those problems.

Scenario #5 – International Court on the High Sea: Many companies have issues in dealing with the complexities of the national court systems and may well want to circumvent national courts in favor of international courts for handling disputes. If the right kind of court system were put into place, on the neutral ground of a floating vessel, companies may voluntarily opt to use it as a more efficient system for dispute resolution.

One approach may be to rewrite the rules of deciding verdicts by opening up the decision to the masses. More on this concept here.

Scenario #6 – Global Election Center: One central features of a floating community like this is neutral ground. So the operation behind conducting a global election, one that crosses national boundaries, is an operation best managed from a location with no national ties.

Sometime in the future, global elections will be used as a marketing tool, to expand awareness of certain events and to give the public the feeling of ownership when it comes to a specific selection process. As an example, each of the following could be handled with an initial slate to choose from, with people around the world making the final selection.

  • Location of the Olympics
  • Location of the World Cup
  • Time Magazine “Person of the Year”
  • Selection of the Nobel Peace Prize Winner

Over the coming years we will see a number of variations to the global election theme and you will be asked to weigh-in on a variety of major global topics.

  • Should plastic bags and bottles be banned worldwide?
  • Should research be banned on creating new forms of life, human cloning, or genetically modified organisms?
  • Should there be a global standard for human rights, issues of right and wrong, or other life-related matters.
  • Who owns the Moon or Mars? Who has the right to mine asteroids or mineral deposits found deep within the center of the earth?

To many of us, global elections like these will come across as a nuisance, background noise with very little credibility. But all will be contributing to a larger movement involving global democratic processes.

Living a working at sea …sometime in the future

Final Thoughts

A prospective investor often looks at a new idea and asks the question, “How will this fail?”

An entrepreneur will usually look at it from a vastly different perspective asking the question, “How can I make this succeed?”

In the mind of an entrepreneur, nothing is static or fixed. Everything is changeable, re-workable, and no barrier is too big to overcome.

The idea of large, mainstream corporations using floating ships for scientific or entrepreneurial experimentation may have seemed unrealistic in the past, and surely some of the ideas above — intended as thought pieces and conversation starters — are more likely to come true than others.

But consider that it wasn’t long ago that a small group of English Protestants set out on a much more perilous and unlikely journey. Their aim was simply to establish a new settlement where they might be free to live in accordance with their beliefs and experiment with self-rule. Their journey played a key role in the development of modern democracies. The yearning to live, explore, and pursue liberty has inspired people throughout history to venture out upon the waves.

In the years ahead, we may once again return to the sea to find our true calling.

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