Unlocking Market Potential with Hypernomics: Doug Howarth on Multidimensional Market Analysis and Competitive Advantage

Welcome to Behind the Numbers, hosted by Dave Bookbinder. In this episode, we explore the groundbreaking field of hypernomics with Doug Howarth, CEO of Hypernomics, Inc. and author of Hypernomics: Using Hidden Dimensions to Solve Unseen Problems. Doug introduces the science of hypernomics, explaining how it leverages multidimensional analysis to reveal hidden market structures, constraints, and opportunities across various industries.

Doug breaks down hypernomics as a transformative approach to understanding complex markets. By mapping out market variables like square footage, lot size, and price in the housing market, hypernomics can predict pricing ceilings and optimize decision-making. This methodology extends well beyond commodities, offering insights applicable to everything from real estate to retail.

Throughout the episode, Doug shares practical examples, including choosing a washing machine and designing optimal restaurant seating during the COVID-19 pandemic. These cases illustrate how hypernomics can simplify complex decisions for businesses and even small enterprises, making it a valuable tool for any industry.

Hypernomics isn’t just for large corporations; Doug explains how this powerful tool can help business leaders identify market gaps, anticipate demand, and strategically position new products. Hypernomics, Inc. has developed software to map out competitive spaces and understand the upper limits of demand, allowing businesses to avoid costly mistakes and maximize profitability.

Investors can also gain an edge with hypernomics. Doug shares how their private fund, guided by hypernomic principles, has outperformed the S&P 500—demonstrating the system's effectiveness in stock market investment.

Looking ahead, Doug envisions hypernomics becoming a core discipline in business and economics, with applications across industry, academia, and government. His goal is to see hypernomics adopted widely, revolutionizing how markets are understood and navigated to support smarter decision-making.

To learn more about hypernomics, connect with Doug Howarth on his website at dughowarth.com or visit hypernomics.com. His book is available on Wiley, Barnes & Noble, and Amazon.

About our guest:

Doug Howarth, CEO Hypernomics, Inc. & Author of Hypernomics: Using Hidden Dimensions to Solve Unseen Problems

Doug Howarth unleashed a paradigm shift. He discovered Hypernomics. It alters economics in the same way relativity changed physics, as it uses new frames of reference. It starts with four dimensions and adds time for a fifth. But, there is no upper limit to the dimensions considered. It finds the linked, opposing, self-organizing states of Value and Demand at work against each other at all times - just like the game of tug-of-war. 

At age 14, Doug Howarth sensed the plotting systems created by René Descartes were inadequate for many tasks. Decades later, he made a series of startling discoveries. He found the economy self-organizes in recognizable opposing patterns and devised ways to portray markets in four, five, or any number of dimensions. Doug named this new field Hypernomics. In 2011, he formed a company, Hypernomics, Inc., who show their customers how to take advantage of Hypernomics. 

Hypernomics. Inc. has worked for NASA, United Technologies, Lockheed Martin and Raytheon, among others. Along with two of his Hypernomics colleagues, he was awarded US Patent Number 10,402,838 for Multivariable Regression Analysis, the world's first software designed to deconstruct markets into their 4D structures.

​Doug has written 13 peer-reviewed publications across four continents.  They've been issued by the Institute of Electrical and Electronics Engineers (IEEE), the American Institute of Aeronautics and Astronautics (AIAA), the Society of Automotive Engineers (SAE), and

Episode Transcript

(00:00):
Music.

(00:24):
Hi, everyone, and welcome to Behind the Numbers. My name is Dave Bookbinder,
and this is the show where we dig deeper to understand what really matters most in business.
Today, we're going to have a very interesting, deeper dive into the world of
business with Doug Howarth, who is the CEO of Hypernomics, Inc.
Hey, Doug, welcome to Behind the Numbers. Great to have you here.
Hey, thanks so much for having me. I love your show. Thank you for having me

(00:45):
on it. Thank you. So much to talk about here.
I'm excited for this conversation, but why don't we start by you just introducing
yourself to the audience.
Tell them a little bit about who you are, and then we'll get into all the fun
stuff around hypernomics.
Yeah. Again, my name is Doug Howarth, founder of Hypernomics, Inc.
I worked in aerospace for about 35 years.

(01:07):
And as I left, I came up with this idea of how the market works,
how all markets work in multiple dimensions, And that formed the basis of this
new discipline that we call hypernomics.
And it's especially appropriate to your show because your show is behind the numbers.

(01:27):
This actually shows you what holds the numbers up and what constrains the numbers in a variety of ways.
Yeah, and you're also the author of the book Hypernomics, Using Hidden Dimensions
to Solve Unseen Problems. So that's a great segue for you to maybe define what hypernomics is,
Well, hypernomics takes things that you already

(01:50):
know and then rearranges them into views that lets you see how the market works
that you wouldn't be able to see without it.
So for example, it turns out that in the housing market, for example,
there's certain things that are holding up the prices.
And I think we all know that you pay more for square footage and you pay more

(02:13):
for in-house, you pay more for a lot size that's bigger.
This actually shows you how those relationships work on what we call the value
side and then on the demand side, this works out the limit for the housing prices
that can happen in any certain area.
It works out that this particular methodology Methodology works for every industry

(02:37):
we've seen outside of just the raw commodities such as gold and iron ore.
So it can tell you if you're going to make, say, a business jet,
it can tell you what the limit would be over the course of a number of years
of how many you could sell based on the price.
And it turns out that if you don't understand that data, that you could lose billions of dollars.

(02:57):
And this turns out to be very important for a lot of people.
Yeah, and you shared a, I'll call it a relatable story to help dummy it down
for somebody like myself with regard to a washing machine scenario.
Would it be beneficial to maybe share some of that with the audience to help
them get context around this?
Sure. Yeah, I can start with that. Then I can transition to something that's

(03:20):
even easier. I can go from my wife back down to ants.
So it turns out that the way I came up with this idea was that the wife and
I were going out and we had to buy a new washing machine.
And so we trudged into the local big box store and walked up to a row of washing

(03:41):
machines, and my wife says, you know, I like this machine here.
She says, it's got a bigger drum than we have at home. And I thought,
capacity versus price, that's what you might call a two-dimensional problem.
And then she said to me, you know, you only got one delicate cycle at home.
I want to have more delicate cycles.

(04:01):
And I thought, cycles and capacity versus price. She's up to a 3D problem.
So we liked the one machine that we were looking at. And then we went to the
next machine up the line.
And it had more of everything, including the price. And I asked my wife,
I said, what about this one?
And she says, it's too expensive. We can't afford it.

(04:22):
And I realized in that instant that when we bought that machine,
we were going to take the quantity for that machine being sold for
that year out one unit and then
if you know based on what the world is doing a
whole bunch of people are pushing the number of units out for this view this
particular model and that all the other models would be in the same kind of

(04:43):
plane people buying fewer of the more expensive machines and more of the cheaper
machines so she would add a quantity to the problem so she was looking at The capacity,
cycles, price, and quantity.
That turns out to be a four-dimensional problem.
And that's where the hyper comes in, hypernomics. Hyper means existing in more than three dimensions.

(05:07):
So my wife was solving a four-dimensional problem in her head.
And as I looked around the store, I looked at everybody in all these different
departments, and I realized instantly that everybody was doing this all the
time in every market they were in.
And then after I wrote the book, I happened to be studying.

(05:28):
I got done with a trail run, and I was sitting at the end of a trail.
I was on the asphalt where I parked my car.
I noticed this little reddish-black ant.
And I said to myself, well, you know, Richard Feynman, the Nobel Prize winning
physicist, would study ants. Why can't I for a few minutes?
So I started to watch this little reddish-blank ant. And he starts to make a,

(05:50):
starts to turn in a counterclockwise fashion.
And he keeps going and going. And he finally traces out 360 degrees.
And he's out just a little bit further than he started.
And then he goes and fits and starts again. And he goes around another 360 degrees.
And then another one. And I noticed that when he stops, he's on what are for

(06:11):
him little high spots in the asphalt. He's on the top of a pebble.
And he's looking around. And I realized to myself, this little guy is doing reconnaissance.
And so I raced home and I typed in ant reconnaissance into a search bar.
And it turns out that ants do recon and they look for things in houses,

(06:33):
their little house, where they're going to make a new domicile.
They look for the amount of floor area they can get, the headroom,
because they don't want it to be too high or too low, the cleanliness,
and they want it to be away from the neighbors. They don't want any hostiles.
And so it turned out that this species of ants, which has been around for 140

(06:53):
million years or more, does multidimensional analysis of its market.
And so, by default, it turns out that humans, smarter than ants,
have been doing hypernomics since they've been humans.
Fascinating stuff. And you've also got patents for four-dimensional structures, if I'm not mistaken.

(07:15):
Yeah, we've got this patent here for the first four-dimensional display of hypernomics using software.
The patent office was first griping that we were trying to patent mathematics
and we suggested to them, no, we're patenting the display of mathematics.
So what we do is we have a certain area in which we show the markets in this fashion here.

(07:43):
We show them with a red demand plane over here, red showing the quantities going
this and the price is going this way.
And so these will be the prices and quantities for a bunch of,
in this case, business jets.
Then over here, we show the value of the business jets relative to their value and their price.

(08:07):
So the reason we got the patent is that this display recognizes that the demand is limited.
So red kind of being a stoplight for how much you can have.
And then green being go. No, you can keep adding value to a limit,
the limit being the demand frontiers to come out of this.
And so we finally got a pat based on the math that creates those kind of views

(08:33):
so that you can actually, in the software, you can actually see what you're doing.
And then when you make a solid print out of it, like I did there,
you can actually literally get a feel for your market to figure out where open
spaces in the market lie, where you could put a new product in.
And by interpolation, you could actually discover that you can make something

(08:54):
that nobody else has, but everybody wants.
And that's kind of what we like to, that's our mantra, is make something that
the market wants, doesn't have, and can afford.
Good mantra. Doug, we are getting close to commercial break,
but before we break, why don't you tell the audience how they can connect with
you if they want to learn more about you, and where can they get the book?

(09:14):
Yeah you can go to our go to
the company website which is hypernomics.com that's h-y-p-e-r-n-o-m-i-c-s.com
and you go through a bunch of the little vignettes that we've put up as blogs
they come on from my linkedin post at doug howarth on linkedin linkedin.

(09:38):
And you can write us at info at hypernomics.com or you can go to my personal website,
which is dughhowers.com or you can go off and find my book hypernomics using hidden dimensions,
to solve unseen problems you can find it on the wiley site barnes noble or the

(09:58):
amazon site sounds good you can pretty much get it anywhere is what i heard
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(10:40):
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(11:04):
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(12:35):
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(12:58):
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And welcome back to behind the numbers i'm dave bookbinder and we are talking

(13:20):
with doug howarth who is not only ceo of hypernomics inc he's also the author
of hypernomics using hidden dimensions to solve unseen problems and as a patent
holder for four-dimensional structures in the first segment,
Doug really helped to define how to think about the problems.
But I want to, Doug, take you into the real world of how you're using it currently with your clients.

(13:43):
And I know that you're using it, we'll call it at the upper end with large organizations like NASA.
But this isn't just for that type of sophistication, if you will.
It's also applicable to your local restaurant, for example.
Yeah, yeah. During COVID, out here in California, we were allowed,
you remember this that COVID ramped up in early 2020.

(14:06):
And so out here in California, we were allowed to eat outside during COVID,
And most of the restaurants here, you know, they had pretty nice indoor dining
rooms, but not many of them, excuse me, had very nice patios or patios that were the same size.
So we went to our local favorite hotspot and they had capacity of roughly 100

(14:29):
inside and something on the order of a third of that outside.
And so we would go down to the restaurant. We would find ourselves on Friday
and Saturday night being in these really long lines.
Try to get in to get some food.
And I noticed that they had an arrangement of tables that didn't match with

(14:50):
the party size that came into the restaurant, which is to say,
they had several tables of six and several tables of four and very few tables of two.
And it works out in this particular restaurant that they have more parties of
two than they have parties of four and six.
In fact, if you do the research nationally, you'd find out that nationally,

(15:15):
there's more than twice as many parties of two as there are parties of four going to restaurants.
So I pulled the manager aside. We know her pretty well.
I said, hey, Kayla, you want to make some more money here? She goes,
well, sure, Doug, what do I need to do?
I said, your average party size coming in here is smaller than your average

(15:37):
table size. You need to take out
some of the tables of six and four and replace them with tables of two.
And so she did that. And then two months later, her revenue shot up 25%.
Same floor area, just a different rearrangement of the seating that allowed
to have the more throughput.

(15:59):
And so it's understanding that there's a certain demand curve for seats that
you can discover that used to your benefit to.
Help a local restaurant out. So it was just as simple as that.
It's a very simple idea, but it's not well understood universally.
Yes. And then part of this conversation is to help this become more universally

(16:23):
understood as a concept and as a way to really become a competitive advantage.
So, Doug, I'm going to ask you to talk to the business owners and business leaders
out there who are watching and listening and tell them how they can employ hypernomics
in strategy for a competitive advantage.
Yeah. Again, the software that we've developed allows you to plot where you

(16:48):
and your competitors lie in this competitive space over four dimensions.
And again, it sounds kind of complicated, but it takes things you already know
and then reassembles them into this different view.
So, for example, you know when you're buying an electric car,
for example, you know that you're buying range and horsepower.

(17:12):
So, in the electric car market 2013 here on this green side,
every one of these dots represents where an electric car was relative to its
range on this direction and its horsepower in this direction.
And what software lets you do is create a map that shows you where the open
spaces in the market are, so that the areas in which nobody's competing.

(17:36):
Are areas that are bounded by products that are already selling, but they're open.
In fact, Tesla used this to their advantage to put a whole bunch of new models into this region here.
And then once you understand what the market is looking for relative to its
value, then over on the demand side, you can figure out how the market's going
to react, how many units you could possibly sell.

(17:58):
There's this limit that the market creates for itself.
This is called an upper demand frontier. And by knowing what this outer demand
frontier is, that you can set the upper bound to what it is that you think you might sell.
Now, if you don't understand that there's an upper demand frontier,
you could as Aerion, Aerion was an aerospace company trying to build a supersonic jet.

(18:22):
They tried to exceed the upper demand frontier for their market and they failed.
And so in the process of doing that, the company folded and they lost us between one and $2 billion.
So this is something that everybody can use once you understand the process
of how to use it, because it's reflecting what everybody does in the market over time.

(18:45):
Yeah. And Doug, are investors using this in terms of thinking about how to manipulate,
not manipulate, but invest in the stock market?
Yeah. Yeah. In fact, we created our own fund, thanks for that day and we we
find that the stock market behaves the same way so this is the dow 30.
From uh five years and one week ago this is the dow 30 this is the 30 stocks,

(19:14):
that are make that up so this back back then this was uh.
This was Boeing here. Boeing was doing really well five years ago.
This was before they had all their problems.
Then you have Microsoft and Apple down there.
And over here, these are the features that are holding the stock market up.
In this particular case, the market really likes return on assets,

(19:39):
and they like journeys per share.
And so what we do is we take a bunch of these different features.
Those are only two features of a stock.
We take up to six or seven or eight and then jam them all together other and
find out how the market's reacting.
So stocks that are below this plane may be undervalued or there may be other
features that are involved.

(19:59):
Stocks that are above the plane may be overvalued. So what we do is we try to
find undervalued stocks.
We take several cuts at this and then what we do is we go ahead and buy the
stocks that are undervalued and wait for them have to go up.
And so when we started this fund in February of 2020, we indexed ourselves to

(20:22):
one and we were only buying stocks from the S&P 500 and only going long so that
people could understand it.
By the way, this fund isn't open to the public.
I got to say this, the SEC doesn't come down on us. It's a private fund.
But we went from one to two, which is time to double. We doubled in less than 50 months.
And at the time we doubled, which is just a couple of months ago,

(20:44):
We were doing 1.9 times as well as the S&P 500, only using stocks from that.
And statistically, the chance of that happening, solely to chance,
was less than 1 quadrillion, quadrillion, quadrillion. Wow.
Tell the audience how they can find you, Doug, and where they can grab the book.

(21:07):
Yeah, you can find me personally on my personal website, doughowarth.com.
We have more information over at the company website, which is hypernomics.com.
That's H-Y-P-E-R-N-O-M-I-C-S.com.
You'll find there are several blogs that show you the individual,

(21:28):
the yes that we've created to make it easier for you to understand how this stuff works.
And you can also find my book on hypernomics using hidden dimensions to solve
unseen problems. You can find
it on the Wiley website, Barnes & Noble's website, or the Amazon website.
Thank you for that. So I want to talk to you about the future before we have to wind up here.

(21:52):
Maybe at some point your stock market investing algorithm will be available
to the public and folks will be able to take advantage of that.
But what's the future look like for hypernomics? I think you had mentioned something
to me about perhaps showing up in some universities.
Yeah, we've got some interest from university students.
We actually had before COVID a university seminar on an extension university, a big one here locally.

(22:21):
We want to try to get back in front of universities. universities,
we believe that modern economics is actually a subset of what we call hyper nautics.
It modern economics thinks there's the law of supply and demand and,
you know, it does apply to commodities.
There's a single point equilibrium, which is what the law of supply and demand.

(22:44):
Works out for you and that works out for something like gold or silver or iron ore,
but as we saw with the business jets in the electric cars car iron ore goes into those,
and they have a whole bunch of response they have a whole bunch of products
that are doing just fine there and so you have to use the law of value demand
to describe them so we see hypernomics pushing itself into industry, schools,

(23:12):
government, and making the world a better place five, 10 years out from now.
That's fantastic. I wish you all the best. And hopefully folks in the audience
will remember that they heard about it here first. Wouldn't that be fun?
Doug, unfortunately, we are out of time here, but I can't thank you enough for
joining us today on Behind the Numbers.
Well, Dave, thank you so much for having me on your show. It's a great one,

(23:34):
and I really appreciate being on it. Thank you. It's a pleasure.
Again, we've been talking with Doug Howarth, who's the CEO of Hypernomics and
also author of Hypernomics, Using Hidden Dimensions to Solve Unseen Problems.
Definitely check that out and stay tuned for more on that as we go forward here.
Thank you, Emma, out there somewhere for running the board today.
Great job running the program.

(23:55):
And thank you out there in the audience, wherever you're tuning in from in more
than 100 countries. Really appreciate your support of the program.
My name is Dave Bookbinder, and I'm the one that my clients turn to when they
want to know what their most important assets are worth.
You can always find me on LinkedIn. I'm happy to have a conversation with you.
And that's all we have for today, folks. We'll see you next time on Behind the
Numbers. Take care, everybody.