Nov 8, 2020

Modern Gospels

The religions of bitcoin, Tesla, and Peter Thiel

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Who is this for?

  • Founders. Peter Thiel talked about the value in building a "cult" at your startup. What does that mean? And how might you take it further? The secret in creating a truly resistant organization may require building a religion.
  • Investors. Scott Galloway often talks about backing "unregulated monopolies." Another ripe category for investment might be "unrecognized religions." There's a reason Tesla is so difficult to short.
  • Learners. Technology has fundamentally changed how religions are born. Communities coalesce on message boards, spread ideology on social media, and create functional gods. Understanding this phenomenon explains some of the bizarre behavior of tech leaders, and illuminates the strange dynamics of internet culture.

On a duffed wooden pew, I prayed for Jesus.

It was not my idea to begin with, nor the manner in which I would have chosen to spend a Sunday. The year before I had found a sheath of snakeskin in my garden, contributing to the sense that the woods surrounding my house were full of shadowy magic that might disappear if I paid them insufficient attention. I would rather have been there, searching for my next find. But under the guidance of the avuncular white-haired vicar, I summoned the son of god.

“Close your eyes and ask Jesus to enter you. Feel his lightness,” the vicar intoned. At least that’s how I remember it twenty years later.

And so I did, screwing my eyes shut, turning my face toward the stain-glassed windows, hoping for a ray of light to illume my cheeks, to find myself, suddenly, irrevocably sun-shot.

At the time, I would have found almost any indicia significant, a shiver or dizzy-spell, a sudden headache or bout of indigestion; open to epiphany or flatulence. I was young, yes, nine or so, but more importantly, devout. Or at least, keen to be, keen to believe: an assiduous night-time supplicant, a grave child beneath a godly penumbra. My father had passed away when I was six, and in a mad fumble for an organizing principle to explain his absence, I’d adopted a fierce piety that must have confused my gently, moderately Christian family. I prayed each night for the rest of my family to live and that they not abandon me in sleep, driving off into the night and leaving only a skate of tire marks in pale gravel. (They didn’t.) This fear wasn’t grounded in reality — I was, and am, blessed with an unshakably strong, loving nuclear family — as much as a confused, budding mind attempting to sense-make.

I prayed dozens, occasionally hundreds of times during the day, incessantly worried about accidentally peeving the almighty, a fear that stoked the rather ornate obsessive-compulsive disorder I developed at the time (and which I have written about previously). Had I been familiar with them, I would have considered Solomon’s words life-affirming: “The fear of the Lord is the beginning of wisdom.”

But there was another side to me, too. We are, I think, all susceptible to the myths we cultivate about ourselves, relying on them to reassure us that we are who we’re meant to be. The result of my personal lore is that I am prone to thinking, questioning, to healthy distrust. After escaping the strangling noose of an umbilical cord, an Irish nurse held my squirming figure and said, “Oh. This one’s been here before.” That, and my godparents’ card, delivered on the day of my birth, which instructed me to question everything. Lastly, the plaque in my father’s forest green study that took on the spiritual significance after his death:

A Prince who is not himself wise, cannot be well-advised...Good advice depends on the shrewdness of the Prince who seeks it.

These are paltry tokens on which to build a narrative, a theory of being, but they are the keystones on which a certain inherent skepticism was justified.

Which is to say that there were shades to my apparent devotion. And, if I am honest, there was always something slightly calculating, gimlet-eyed about my religious zeal. Beneath whispered prayers, there was always an irritating, stubborn incredulousness that battled with the desire for godly certainty; the same feeling as finding a brassy pound coin under my pillow after I’d lost a tooth and convincing myself my mother hadn’t put it there: but isn’t it nice to believe. I made my Pascalian Wager and hoped for better proof.

(It is at this point, I must say: my words are not meant to offend or discount your beliefs, whatever they may be. This is an account of my mind — replete as it is with opinion and idiosyncrasy. You and I may disagree, and as long as we can hear and listen, we will be both be richer for the encounter.)

And so on that Sunday, hands clutched, nose scrunched in concentration, I tried to find god. I was, I realize now, engaging in the imperative hidden in Voltaire’s maxim, “If God did not exist, it would be necessary to invent him.” God did not appear, and so I sought to invent him, hoping for the feeling that might fuel fabrication.

In the belly of a 16th-century church, this felt like an ancient act, a subtle echo of half a millennia of worship. Today, I think it was a modern one. As the province of traditional religion shrinks, ill-equipped to deal with modern problems, and too slow to adapt, we are all forced into the divine task of origination, of conception. We use technology to congregate, to proselytize, to produce miracles. We make the profane sacred and pen new gospels. And as our old gods die, we invent new ones.

Defining religion

What is religion?

I am tempted to adopt the stance of Supreme Court Justice Potter Stewart when asked to characterize pornography: “I know it when I see it.” Wherever there is ritual and prayer, whenever extraordinary claims are made in vindication of a higher power, we might reasonably see religion.

But that doesn’t leave us with much, and it says nothing of how such movements begin, the purposes they serve. It is easy to see a man prostrate in front of an altar and say, “that’s religion.” But what came before the altar, what is above the altar, and why?

Marx considered religion a soporific intended to preserve class power (“the opium of the masses”), while 19th-century anthropologists like Edward Burnett Tylor and James George Frazer assumed it a blunt attempt to explain natural phenomena. It was only with Émile Durkheim that religion was framed as fundamentally social, endemic to human collectives.

In The Elementary Forms of Religious Life and other work, Durkheim outlines the three traits all religions share: a unified system of beliefs and practices, a moral community, and sacred objects.

The final piece here is particularly significant — while Durkheim says object, he means god, or tenets so axial as to take the place of a god. In Christianity, the sacred objects are god, Jesus Christ, the Virgin Mary, the sign of the cross, along with any number of minor shrouds and stains. Buddhism has Siddhartha (or Gautama), but just as importantly, perhaps more so, are the “Four Noble Truths.”

Durkheim juxtaposes this notion of the “sacred” with that of the “profane.” While the sacred is used to represent the community’s values and possesses a special resonance or energy, the profane is everything outside of that realm, partially that which challenges cherished values. Apostates, noninitiates, and false idols are all profane, but so is a sea of insignificant objects. But the profane is really defined not by what it is, but by what it’s not. It is the not-sacred, a religious negation. One cannot exist without the other; in keeping with the rest of Durkheim’s communal focus, both are fundamentally social, serving to separate a believing in-group from out-group infidels.

Objects are made sacred as part of the same process by which religions are themselves originated. This week, American voters went to the polls — physically or metaphorically — and watched our rendition of democracy in action. For members of each party, this represented a moment of “collective effervescence,” Durkheim’s term for the energy created through ritual and worship. Religions are created and sustained through these events and the groupish transcendence they make. In expressing their assimilation, individuals feel as if they are part of something, a force larger than themselves, which promotes commitment and deepens belief. In an attempt to sustain and emphasize this feeling — which Durkheim called “mana,” using the word favored by the Polynesian people he studied — the community creates the sacred object as a representation.

The result of Durkheim’s thesis, the skeleton, is something like a spiritual flywheel: moments of collective effervescence bestow transcendental mana, sacred objects are designated to sustain that feeling (and profane objects are shunned), and these, in turn, give further reason for moments of collective effervescence. We see the same process play out online, amplified by the ease of connection, social media’s preference for conflict, and technology’s capacity for miracle.

Online effervescence, apostasy, and miracle

On Wednesday, the people of Georgia elected Majorie Taylor Greene to congress. There was little other option: she ran unopposed. A white Republican, Greene is nevertheless among the first of her kind, an elected official in support of QAnon. This conspiracy theory alleges Democrats operate a “Deep State” replete with child-molesting Satanists. Right. Greene described the group, which The Atlantic called “a New American Religion,” as “a once-in-a-lifetime opportunity to take this global cabal of Satan-worshiping pedophiles out.”

There have always been lunatics; the insane, unlettered gibbering of Alex Jones’s Infowars has fouled our screens and airwaves for over two decades. But the internet is a fundamentally different realm than it was even five years ago  — busier, louder, boiling with niches and platforms that support them. While it might once have taken a movement decades to accumulate a swathe of followers, QAnon has managed it in just three. As many as 3 million followed Facebook pages associated with the group before the company took action in October of this year.  

The internet, and platforms designed for socialization and connection, have played a pivotal role. QAnon started on 4chan but relied on Reddit, Twitter, Facebook, and YouTube as part of its rise. After being punted from various platforms, the group slithered to EndChan and 8kun. These are by no means the only options open to new religions: searching for “religion” on gaming platform Roblox manifests a “Church of Satan” game. “Church” produces “The Church of the Pear,” “Meme Church,” “The Church of Baby Yoda,” “The Robloxian Church,” “Church of Finn Wolfhard,” “The Masked Church,” and countless others. Most are probably jokes or trivialities, but there is no reason why the next world religion could not begin as a game. (There is an argument to make about platform-risk, but fringe movements have demonstrated a cockroach-like ability to survive different nuclear fallouts.)

Like message boards, online multiplayer games provide opportunities for collective effervescence, organizing a community around a common goal or ritual, giving mana. Unlike the movements studied by Durkheim, though, the internet enables this experience either on-demand or with much greater frequency. Providing The Church of Baby Yoda had a sufficiently large following, I could engage in worship, in effervescence, whenever I wanted, joining a round of play or a buzzing chatroom. The result is an acceleration of the Durkheim flywheel, with fervor building as interaction increases. A moral community forms, and characters like ‘Q,’ the unknown creator of the QAnon movement, become sacred objects, gods. Their missives, in turn, form the basis for a set of hallowed beliefs.

While the internet writ-large simplifies the creation of these moral communities, solving the first Durkheimian imperative, social media’s particular dynamics are pivotal in distinguishing between the sacred and profane and deepening the divide. In a group of like-minded individuals, discussion tends to lead to greater radicalization: we add new arguments to bolster our existing beliefs, and admire those with the most extreme position in the group. Social media amplifies this predilection to new levels — we have access to much larger like-minded groups. As social capital accrues to those on the extreme, others, in turn, seek to push beyond the norm to win followers. Academics Justin Tosi and Brandon Warmke have referred to this practice as “moral grandstanding.” Combine this with the fact that we react most to posts that induce rage and that influencers may benefit from fomenting polarization, and you have the ideal environment in which to set up the “us” versus “them” dynamic pivotal in creating a new religion. Adherents of Q can afford to make absurd, incendiary remarks on social media (“Angela Merkel is Hitler’s grandaughter”) safe in the knowledge that apostasy helps their cause. As the non-believer pushes back against either sacred objects (“Q is a fraud”) or an established belief (“Angela Merkel is not Hitler’s granddaughter), the believer knows their message will be amplified, and subsequently, celebrated by their moral community. If the rise of internet communities accelerates Durkheim’s flywheel, social media intensifies the process, more starkly delineating between sacred and profane and heightening an adherents connection to the cause.

And what of the miracle?

Durkheim makes no special mention of religion’s most famous acquisition strategy. Water into wine, loaves and fishes — perhaps Durkheim would simply have considered them moments of collective effervescence, transformed into sacred objects in the form of moral stories, rather than something distinct in and of themselves. They are worth mentioning when thinking of how the modern world has altered the ability to create new religions. If a new movement were looking to justify a set of extraordinary beliefs through extraordinary action, there would be no better place to begin than with technology.

A doctored photo, a deep-fake, a voice skin — all can be used to create “miracles” in a matter of speaking, whether it be an AI-generated video showing an incoherent Nancy Pelosi or a clumsily-edited image showing Intelligence Chair Adam Schiff cozying-up to Jeffrey Epstein. These events contravene social expectations and preconceptions so sharply that they function as a modern miracle — extraordinary vindication of a set of beliefs.

There are legitimate technological miracles, too, though we choose to call them invention, innovation, or science. Apple has often been referred to as a “cult.” It makes sense; the Apple of Jobs and the iPod was a purveyor of miracles. What else do you call a machine that put “1,000 songs in your pocket,” while a CD held twelve tracks? It was an abrogation of a perceived natural law no less startling than a statue that begins to weep.

The nineteen years since the iPod’s inauguration have seen a flurry of miracles, a steady wave of wonder, join Jobs’s “feeding the multitude” moment.

New testaments

It is en vogue to classify any moderately popular startup as a “cult” or “religion” without considering what such a suggestion entails. Usually, all that is meant is that said company has an animated fanbase, a high-NPS score, perhaps a vague nod towards community. (Aside: in our “Indie Researcher” panel on Friday, Toby Shorin talked about “doing violence to concepts,” touching on cults.)

Whatever the headlines might say, Peloton is not a cult, let alone a religion. There is no sacred object, no unified set of beliefs, no moral community, no miracle. There is a sense of collective effervescence surely — the adrenalin-pumping classes seem to provoke some feeling of transcendence — but that has not been transfigured into religious belief.

Durkheim would not consider the Apple of Tim Cook a religion either. Jobs was the truly sacred object of the business, the god; without him, there is a lack of division between sacred and profane. Even the most ardent of Apple fans would concede that recent phones, though well-made, fail to possess the same resonance as the first iPod. A belief system remains in place and has, in some respects, been bolstered: Cook’s defense of personal privacy alloyed with Jobs’ minimalism and Ive’s appreciation of human intuition. But there is no collective effervescence now that keynotes have taken on a more prosaic tone, and only miracles of a minor variety.

The most conspicuous modern, technological religion is bitcoin and its surrounding ideology. In almost every respect, it fits Durkheim’s definition. There are several sacred objects, including the bitcoin itself. The fact that the currency has failed as a means of exchange may owe as much to its spiritual importance as its volatility: to spend it is a shibboleth. By doing so, the believer reveals a chink in their devotion and commits the crime of making the sacred profane. Satoshi Nakamoto, the pseudonymous creator of Bitcoin, is a sacred object, too, of course. Like Q, he is aided by his inconspicuousness, avoiding the vulnerability of being a known personality that can be attacked or discredited on specific grounds. The bitcoin movement has a clear belief system (decentralization is treated as a moral issue), clear separation between sacred and profane (bitcoin and fiat), and moments of collective effervescence (bull runs and halving events). Even when thinking about the future of bitcoin, the questions are fundamentally religious. The technological struggle is mostly won; what’s left is a battle for hearts and minds, for believers.

The Church of Tesla fits the mold, too. To long-term holders of the stock, Musk is a bawdy, all-knowing god, working in mysterious ways. They may not always understand his actions, but he is not to be questioned. In addition to being a sacred object himself, Musk is a canny creator of new sacred objects — this week, Tesla released a new tequila, an icon available to believers priced out of a Model 3. Musk is also agile in his use of social media. By courting controversy, he implicitly and explicitly engages in “moral grandstanding” — calling out “pedophile” rescue divers and baiting the SEC. In these cases, Musk positions himself as an ethical authority, drawing lines between sacred and profane. In his skirmishes with the SEC and other authorities, he also stokes an implied worldview, which is, incidentally, the same weltanschauung as Raskolnikov’s at the beginning of Crime and Punishment: great men operate according to their own laws. This, along with a gentler commitment to salvation from climatic extinction, forms the basis for the Muskian Gospel. Believers are given opportunities to celebrate these values at Tesla keynotes, and once again, during exciting, senseless bull runs. Just as with bitcoin, these are both ceremony and miracle, a miracle of capitalism in which an automotive company exceeds the EV/revenue multiple of a SaaS firm. While General Motors trades at 1.16x EV/revenue, and Salesforce trades at 11.88x, Tesla stands 14.44x. For the same reasons mentioned above, true believers are deterred from selling their position, making Tesla incredibly tricky to short, whatever the laws of financial reason. In 2020, a reported $27 billion has been lost, attempting to short the business.  

There are other minor examples, each with its own merits:

  1. Y Combinator has an established belief system (the Talmud of Paul Graham), plenty of sacred objects (Graham, Altman, the eponymous street sign where the founders take a picture; Lourdes in Palo Alto), a community, and some collective effervescence in the form of Demo Days. But there is something lacking or lost, a missing intensity that seems to separate it from other modern religions. Perhaps because it relies on non-believers and neutrals (other VCs), the demarcations between insider and outsider, between sacred and profane, are softer. Moreover, while Graham’s startup writing is embedded into Y Combinator’s identity, its broad applicability and wide acceptance may have freed it from parochial attachments, leaving the accelerator without a particular, ideally controversial wisdom of its own.
  2. Wall Street Bets (WSB), a stock trading community on Reddit, succeeds in manufacturing collective effervescence, using every day of trading as an opportunity to connect and celebrate capitalist values. There is an implied creed here, but it is not sufficiently differentiated from the rest of the Western world. WSB seeks to demarcate itself through tone rather than dogma. The result is a weak moral community and few, if any, sacred objects.
  3. Note-taking app Roam Research has succeeded in creating a moral community (#Roam Cult), is cultivating a sacred object (the messianically-styled Conor White-Sullivan), and possesses a budding dogma (there is a right and wrong way to organize thoughts.) That belief system has benefitted from conflict and apostasy on social media, positioning itself in opposition to the organizational theories of Thiago Forte. In time, Roam’s doctrine may increase in complexity. The community will also need to find ways to interact and bond through shared experiences.
  4. There is a half-constructed Basilica of Thiel, frequented by venture capitalists and startup operatives. While Thiel himself is a god here, divinely absent, the actual sacred object is the value of “contrarianism.” Beyond this notion, there is less of a cohesive belief system, meaning that the moral community defines itself in negation, adopting positioning in response to the perceived mainstream. There appear to be few opportunities to engage in collective effervescence and accrue mana.

In time, these may blossom into full religions or go the way of most spiritual movements, withering into obscurity. But now that we know new religions can be formed, that there is, in theory, a playbook to be followed, what should we do with it?

It is time to pray.

Inventing god

What do we wish to be: worshipper or worshipped? Supplicant or sacred object? Apostate or convert?

Our stance concerning modern religions and this fertile period of theogenesis may depend on how we choose to define the organs of faith. There’s immodesty (profanity, really) in casting religions as sociological phenomena that can, perhaps, be architected for adherents of Old World belief systems. But for those willing to think in such terms, there is wealth to be gained for both investors and founders. Scott Galloway is fond of expressing his preference for investing in “unregulated monopolies” like Facebook, Amazon, and Google. Speculators may find similar success backing — or at least not shorting — unacknowledged religions. Adherents of bitcoin and Tesla have certainly fared well over the years.

There may be risk in associating too closely with these groups, it should be said. WeWork was, in many ways, an irritating incipient religion. Neumann relished his sacred positioning and was forceful in his orchestration of moments of effervescence through the company’s saturnalian summer camp and Friday night frat culture. There was a half-hearted belief-system (“The Power of We”) and the semblance of a moral community. Earlier in my career, I spent a bit of time with the company’s upper-level management. Though not universal, I remember one character in possession of the startling arrogance of the zealot, the certainty of someone who believes they have been particularly elected to hold a hard-earned secret. WeWork’s flaws were of the more prosaic variety: though Neumann gave us the miracle of “community-adjusted EBITDA” and a $47 billion valuation, his godly touch deserted him. Though a distinction between the sacred (WeWork spaces) and profane (normal offices) was drawn, Neumann failed to accumulate a sufficient number of followers to insulate himself from financial law. At its scale, WeWork succeeded as a religion but failed as a business.

The lesson is, perhaps, that faith and logic are unhappy bedfellows. The devotee sneers at the rationalist for his lack of imagination, while the rationalist laughs at the devotee for his flights of fancy. The wise investor will position themselves such that they might hear and listen to both sides.

The founder may have a different incentive. In Zero to One, Peter Thiel describes companies as positioned somewhere on the continuum between a consultancy and a cult. The consultancy is a godless church, populated by mission-less mercenaries. They arrive at a company, position themselves outside the culture, propose changes, and leave. Startups should strive for a different kind of intensity per Thiel:

In the most intense kind of organization, members abandon the outside world and hang out only with other members. We have a word for such organizations: cults. Cultures of total dedication look crazy from the outside. But entrepreneurs should take cultures of extreme dedication seriously.

By cult, Thiel seems to simply mean a tightly-knit culture, aligned behind a singular mission. But there’s no reason to stop there. Though there is the risk of lurching into the territory of reasonless tire-fires like WeWork and Theranos, the shrewd leader will use collective effervescence strategically to build morale and generate sacred objects.

The wisest of those will choose to make an idea their most sacred possession. Not only is opposition to an idea more useful than a person in fanning a social media conflagration and subsequently winning followers and deepening devotion, but it is also more difficult to denounce. Both bitcoin and QAnon have benefitted from having anonymous creators; company CEOs do not have the same luxury but can build equivalent immunity by positioning the locus of devotion outside themselves.

In time, these companies may look less like corporations and more like a church, built not only for short-term profit but long-term wealth and legacy.

Never has nothingness been so complete, so immaculate.

Bent forward in my seat, I waited for divine intervention. But there was nothing, nothing. Not a shiver or tremble or song in my heart or lustrous breath upon the nape of my neck.

Though I did not recognize it at the time, it was the moment I knew god did not exist for me. There was a slow fallout over the years that followed and finally, a happy renunciation. Guilt and expectation were lifted, and the peaceful dissipation of cognitive dissonance, as if a knot had been massaged from my brain.

I do not believe in god, but I believe in religion. I believe in its power, in the social alchemy it can create. And, to an extent, I believe in the words of Voltaire. As the internet and the broader technological revolution change who we are, how we find and build community, where we derive meaning, we may find our old deities lacking. Those able to recognize that need and fill it, may find themselves rewarded with uncommon wealth and power. It is time to invent new gods. We’ve already begun.

The Generalist’s work is provided for informational purposes only and should not be construed as legal, business, investment, or tax advice. You should always do your own research and consult advisors on these subjects. Our work may feature entities in which Generalist Capital, LLC or the author has invested.