There’s a lot of confusion about technology. It dominates our lives because it holds increasing prominence in society, but most people don’t really know what technology is.

Investors are confused as well. They have a habit of talking about technology in terms of particular products or markets or uses, so that the big picture is lost.

Technology is a transformation. People build things in order to transform their environment. This has been going on for millennia. Ancient peoples built “mills” to convert wheat into flour by a process of grinding. It was a single, repetitive, everyday transformation that was essential for survival.

It’s very telling that the idea of a mill as something that transforms things has passed down to modern times.

Charles Babbage, the Nineteenth Century inventor-entrepreneur who came up with one of the earliest computers, the “Analytical Engine,” called his machine for combining numbers via arithmetical operations “the mill.” Babbage designed his mill to transform one set of numbers into another via addition, subtraction, multiplication and division.