The peak district in the UK is a rambler’s paradise. Long walks between ancient villages, with winter mist or summer haze drenched vistas the payoff for steep tracks and winding bridle paths. The history of the communities in that part of the island is evident everywhere. Rough hillocks turn out to be the vestiges of Roman tin mines. Stone crosses set amidst prim, Victorian graveyards are over a thousand years old; memorials from when the area was still the Kingdom of Mercia. Every now and then the traveller may even come across technology that tells a story of how people coped with change, and market disruption. One such place is the village of Eyam in Derbyshire.
Eyam sits in North Derbyshire in the heart of the dales. Today it has a population of around a thousand. Occupied since at least Roman times, Eyam centres on a lovely old church that dates back to the 13th century. The people of Eyam are famous for choosing to remain when the plague struck their village back in 1665. Rather than flee, and infect other communities, they went to their homes, prayed and mostly died. Eyam was one of the few villages to self-quarantine – no one was allowed to cross the boundary around the village, in or out.
The decision to stay was taken as a community and led by the local priest William Mompesson. His act of foresight and community bravery is fairly well known, with a number of books available that tell the story. Busloads of school children arrive on school trips to visit plague history sights. Less known are some of the steps locals in Eyam, and elsewhere took to forestall the spread of the disease.
As you walk up to Eyam you will see at first one, then a series of plague stones that marked the old boundary of the village. The demarcation line between those quarantined, and those on the ‘outside’ during The Black Death. As now trade needed to continue. Atop one of the stones are round indentations carved into the rock. These holes are just the right size to take coins. The holes would be filled with vinegar during times of infection. It was believed vinegar would clean the coins and prevent the disease passing out of the boundary by way of the currency. Coins would be left in the stone, goods left beside it in return. A worthwhile form of money laundering.
In the middle ages, a villages’ typical response to the arrival of the plague was to rush to church. Seeking salvation villages would cram into the pews and pray. Whole families, many of whom already contagious would take communion from the same cup, and shake hands with their fellow parishioners. In Eyam they locked and barred the church. For those with faith in the cleansing power of prayer this must have been powerfully counter-intuitive. Passing that Church today you will come to Cucklett Delph, a grassy depression that served as a natural amphitheatre where services could be held while allowing families to stand and pray at some distance from each other.
Despite these precautions the plague dealt viscously with Eyam. Of the population of 350 at the time only 83 survived. Families of ten or more were left with maybe a single survivor. The disease was cruel and random. William Momessom himself survived, but was for ever after viewed by suspicion as a possible harbinger of disease — a superstitious lot in the seventeenth century, and with no understanding of virology. William had tried his best. So had the people of Eyam. Today their self-sacrifice is taught as a noble and even intelligent response to the infectious challenge they faced.
Today we see investors trying to work out a rational plan amidst the panic and volatility of a new pandemic. Though hopefully nowhere near as cataclysmic as The Black Death, Covid-19 is forecast to severely disrupt global trade and economic growth. In the public markets pundits are picking that ‘Stay-Indoors’ stocks like Netflix (NASDAQ: NFLX) and Peloton (NASDAQ: PTON) will provide investors a lift; while travel and manufacturing stocks are sinking swiftly. In private equity and venture capital we are looking for our boundary stones – what investments and projects could both assist the affected communities, and provide a counter to the coming slump. Let’s take a few examples.
Cluey, an online education provider in Australia, is surely set to have increased traffic to its site. Cluey, uniquely, offers tutors a platform from which they can run classes, with multiple students, with all participants at home and online. While Cluey’s core offering is tutor support for children of all ages, the technology is fit for purpose for a much wider set of use cases. Trials with primary schools in NSW have already occurred. It may not take wholesale closures of schools to encourage parents to keep their little ones safely at home – in many households the attendant’s stress of being left behind on core subjects can be directly alleviated by Cluey’s offering.
Many of the largest service providers still maintain a high ratio of direct contact with the public. Clinics, banks, telcos, and technology channel sales all have large teams on the ground, in retail environments interacting with thousands of real people on a daily basis. Beyond the ethical duty of care invoked by a pandemic, there is the danger of brand erosion, bad publicity and lower activity if your store or brand is noted to be a place where the disease was caught. To test staff daily for signs of a fever, log, record and feedback to a central tracking point is hard for any organisation. Handheld thermometers checking people coming into a store, or staff at the start of a shift need to share that data immediately with a diagnostic team and trigger the appreciate responses immediately. Just barring entry for someone with a fever may not be sufficient – where did they travel from? did they work yesterday at the same place? etc… These test, question and response management systems are largely yet to be built.
One system, already in market, and under demand for the Covid-19 outbreak is from a company called The Clinician. We have discussed The Clinician before, but for note here is that demand for their ZEDOC platform from Israel to NZ is on the up since the outbreak started. When judging investment upside options at the VC level, we look not for crisis initiators (Covid-19 drives initial demand) but long term utility. So, while the producers of toilet paper may see a short term demand spike as most of Australia, stocks up, long term demand for toilet paper will stabilise – no really disruptive change to habit happens. For The Clinician a pandemic may accelerate a long term utility change, new habits – hospitals and large scale employers standardise on remote monitoring of staff health and Zedoc becomes a standard part of the enterprise suite. Sweet.
You cannot use Black Swan events as an investment rationale at the seed level (some insure-tech founders will likely disagree); but you can look across the portfolio and pick projects that may get a lift from it. When the company is small the questions asked at the board or by a lead investor can sometimes jolt the founders from their hyper-focused tactical plans (so useful in times of steady growth) and have them thinking about the advantage of the moment. Repurposing technology on the fly in response to real time demand is what lays beneath all that trendy talk of agility.
When the Black Death finally burned out of the village of Eyam, and over the next two years the whole of Europe, it left behind few people and a desperate need to innovate. Technology had to become less labour-intensive. It had to become high-tech. For good or evil, the plague years gave us crossbows, new medical ideas, guns, clocks, eyeglasses, and a new craving for general knowledge. And so the rainbow at the end of this terrible storm yielded its pot of gold. The last new technology of the ghastly plague years was the printing press. It finally melted what Shakespeare had named the winter of our discontent. It provided access to knowledge. And it started the rebirth of Europe.[1]
[1] Gottfried, R.S., The Black Death: Natural and Human Disaster in Medieval Europe. New York: The Free Press, 1983.