Sunday Reads #163: Fortune favors the brave (and the restless).
"If you see a fork in the road..."
Hope you had a great week!
This week, let’s talk about luck and success. How do we earn the favor of Lady Fortuna, that fickle and capricious goddess? Is there a way to predictably succeed?
Or to use Naval’s phrasing, is there a way to get rich without getting lucky?
1. Energy in, Fortune Out.
How to get rich (without getting lucky).
Naval Ravikant has a passage in his iconic 2018 essay / tweetstorm, How to get rich:
There’s four kinds of luck.
1. Blind luck.
The first kind of luck you might say is blind luck. Where I just got lucky because something completely out of my control happened. That’s fortune, that’s fate.
2. Luck from hustling.
Then there’s luck that comes through persistence, hard work, hustle, motion. Which is when you’re running around creating lots of opportunities, you’re generating a lot of energy, you’re doing a lot of things, lots of things will get stirred up in the dust.
It’s almost like mixing a petri dish and seeing what combines. Or mixing a bunch of reagents and seeing what combines. You’re generating enough force and hustle and energy that luck will find you...
3. Luck from preparation.
A third way is that you become very good at spotting luck. If you are very skilled in a field, you will notice when a lucky break happens in that field. When other people who aren’t attuned to it won’t notice. So you become sensitive to luck and that’s through skill and knowledge and work.
4. Luck from your unique character.
Then the last kind of luck is the weirdest, hardest kind. But that’s what we want to talk about. Which is where you build a unique character, a unique brand, a unique mindset, where then luck finds you.
For example, let’s say that you’re the best person in the world at deep sea underwater diving. You’re known to take on deep sea underwater dives that nobody else will even attempt to dare.
Then, by sheer luck, somebody finds a sunken treasure ship off the coast. They can’t get it. Well, their luck just became your luck, because they’re going to come to you to get that treasure. You’re going to get paid for it...
You created your own luck. You put yourself in a position to be able to capitalize on that luck. Or to attract that luck when nobody else has created that opportunity for themselves. When we talk about “without getting lucky,” we want to be deterministic, we don’t want to leave it to chance.
These four kinds of luck are actually from an old Marc Andreessen blog post. And he himself quoted author James H. Austin, who summarizes:
Chance I is completely impersonal; you can’t influence it.
Chance II favors those who have a persistent curiosity about many things coupled with an energetic willingness to experiment and explore.
Chance III favors those who have a sufficient background of sound knowledge plus special abilities in observing, remembering, recalling, and quickly forming significant new associations.
Chance IV favors those with distinctive, if not eccentric hobbies, personal lifestyles, and motor behaviors.
It's clear what kind of lucky person they all want you to be. The fourth kind - the deterministic kind where you can't help but get lucky.
But like all great stories, it doesn't give you the crucial piece of info - how do you do that?
How do you become the deep sea diver that everyone comes to when they find hidden treasure?
The answer is: by being the second type of lucky person - the one who makes his / her own luck.
The one who hustles.
Luck, but not an accident.
I loved Shaan Puri's thread about egg-carton entrepreneur Sarah Moore.
Sarah decided that she wanted to buy a business. And she *literally* looked at every single business (400,000 of them) to decide which one to buy.
her "office" was the school library
her "fund" was non-existent as she had no money
her "analysts" were 50+ interns she found on Craigslist
She participated in random research studies to make side $$. She even went blind for a while, from a deodorant study (note to self: Don't spray deodorant into eyes).
She had her 50+ interns look through >400,000 private companies in a year and a half, to find the perfect one.
She reached out to 100 banks to pitch that company. 99 said no, and one finally gave her the loan she needed.
And just like that, she made it happen.
A "break through walls" mindset can help you, well, break walls.
Now, you can say Sarah Moore was lucky. She found the one business that worked. The one diamond among the coals. She found the one bank that was ready to fund her.
Yes, she was lucky. But in no way was it an accident.
She exploited a simple asymmetry.
Before we continue, a quick note:
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Grow your Luck Surface Area.
The asymmetry that Sarah exploited was this:
The amount of effort to evaluate each business might not be small, but it's bounded.
But the upside on finding the right business, is unbounded.
It's simple and logical. But she was the only one who took the premise to its ultimate conclusion.
Increase your "luck surface area" by saying yes to every cheap option that might expose you to luck.
If you see a fork in the road, take both.
If given two almost equal options, pick both.
Actually, don't stop there. Find the secret third option that will produce even more luck.
And... pursue all three options.
As Derek Sivers says (or not): Hell yeah
, or no.
Now, before you close this blog post and run off to do all the things, a word of caution:
Such hustle doesn't work in all aspects of life.
There are some domains where it works, and some where it doesn't.
How do you know which is which?
We spoke of an asymmetry earlier. Does it exist everywhere?
Do you live in a power law world?
Does your sector area of work follow a power law distribution of outcomes?
Is it a winner-take-all (or even "winner take most") domain?
Startups are winner take all.
Books are winner take all
Music (today) is winner take most
In fact, almost anything on the Internet follows a power law distribution.
The central asymmetry (bounded effort → unbounded upside) exists in any and all domains that follow a power law distribution of outcomes.
In such contexts, there's a lot of value in being able to experiment with different alternatives. Fail fast and all that.
In such a world, you can win simply by getting more shots on goal.
I usually don't like sports analogies. But this one (from England's fifth-highest goal-scorer) is apt:
This is also, btw, the central reason why the Lean Startup model works at all.
As I said in The Fat Startup Experiment a couple of years ago (the article where I predicted Quibi's demise):
The first insight about Lean Startup is that it bootstraps leverage from scratch.
There are many types of leverage a startup can have.
Proprietary IP / best-in-class technology
Regulatory capture: Microsoft scaled only because of their hilariously one-sided deal with IBM
The product itself: Instagram has in-built virality. In its early days, Instagram's core use-case was to touch up photos, and post them on Facebook or Twitter. So, by simply using the product, you were marketing it to your friends.
Network effects: Uber
The revolutionary suggestion of the Lean movement was that the process itself could generate leverage.
Create hypothesis → Test → Observe results → Refine hypothesis → Repeat.
That's how Lean Startup works.
Start with a hypothesis: product X solves problem Y for consumer Z. Test it in the most basic way possible, and iterate and refine.
Such a simple process, but generates such strong momentum.
It's like you try to lift yourself by your shoelaces. You wouldn't expect it to work, but magic, it does!
As Ravi Mehta (ex-CPO of Tinder) said during our Twitter Spaces a few months ago, Latency >> Speed:
As a startup, just saying “I’ll move fast” is not enough. It’s hardest to change direction when your car is hurtling down the highway.
Instead, run quick experiments. Learn, iterate, and move to the next one.
Speed is not what’s important. What’s important is frequency. Frequency of feedback.
…The schools that adapted to the lockdown best were the ones that empowered their teachers to try different things. Some teachers tried teaching on Zoom. Some created interactive exercises. Some made students do puzzles.
And when something worked, the entire school was able to double down. While all the other schools were trying to figure out how to get kids to sit put while the teachers droned on on Zoom.
Experiment, always. In a power law world, you need to try different things, and try them fast, to see what sticks.
Coda: An unstoppable force meets an efficient market.
I was having a chat with my friend Pranav a couple of weeks ago, which was the original trigger for this post. One of the things we discussed was "Return on Hustle". Like you have ROI or Return on Investment, there's also a Return on Hustle.
The market may be efficient as a whole, but it isn't efficient all the time. And not all parts of the market are efficient.
A determined person (or company) will find the hole, through sheer force of will.
He who hustles will be rewarded.
Don't expect that you'll know what to do, just by "thinking real hard".
The answer might not be obvious.
It might be obvious, but not to you.
It might be obvious, but still need spelling out.
Throw things against the wall, see what sticks.
Speak to a hundred people, see what comes out.
This was how I struck a partnership that got my app to 250K users in one month (back in 2015), with 2 developers and zero funding. Tried a lot of things, spoke to a lot of people, till we found the one conversation that mattered.
An anecdote I shared back in October 2021 comes to mind:
Something very interesting happened on Twitter this week.
The founder of Flexport, Ryan Petersen, toured the Long Beach port at LA. The same port whose congestion has caused a supply chain crisis across the world.
Lots of intelligent people have thought hard about this problem.
JP Morgan even wrote a detailed research report on the topic (entertainingly titled, Dude, Where’s My Stuff?).
Anyway, so Ryan toured the port, and wrote a Twitter thread making one specific suggestion to resolve the blockage.
And within 8 hours, an executive order was passed by the government to make it happen!
Read his entire thread here.
The meta-lesson is this:
Most markets are not efficient. Not all the time, anyway.
There are often $100 bills lying on the sidewalk.
They might not be visible at first. They might not be visible to everyone. They might not be visible without effort.
But once you know that $100 bill is there, you have a choice. You can theorize for hours as to whether it's fake.
Or you could, ya know, pick it up!
2. Golden Nugget of the week.
I saw this lovely tweet about Pablo Picasso, that is in keeping with today's theme.
Picasso lived to the ripe old age of 92 years. Which is about 33,000 days.
So, even if he started painting when he was a day old and painted till the day he died, he did more than a painting a day. (jokes apart, his first known painting was at age 9).
A lovely reminder that genius is as much (if not more) about quantity as it is about quality.
(You could say the same about hustle vs. brilliance 🤔).
Get more shots on goal.
3. Chart / Comic of the week.
Nuclear Power is indeed that dense!
All of the fuel rods ever used by the commercial nuclear industry since the late 1950s could fit on a single football field stacked about 50 feet high.
This is even more stunning at an individual level. All the energy you'd ever use in your lifetime… would fit in a Coca Cola can.
For reference, the global average carbon emissions per person is 7 tons per year.
4. This blew my mind (and scared the hell out of me) 😨.
When it becomes trivial to create fake news, there will be much more fake news vs. real news.
And when 99% of the content you see is fake, it's best to assume everything is fake.
Fake news is a Distributed Denial of Service (DDOS) attack on the truth.
That’s it for this week. Hope you enjoyed it.
As always, stay safe, healthy and sane, wherever you are.
I’ll see you next week.