Magic Tricks

We founders often act like petty magicians. What we do at our jobs rarely works out well. But when it does, it looks like magic. And when we watch other startups, we believe they’ve got pixie dust because we want to believe we’ve got it too. All of us have seen Uber and Airbnb succeed, so the community keeps churning out Ubers for X and Airbnbs for Y. No wonder our mental models fail us. Cargo cults fail their believers, too.

In my own work, I try to develop methods that rely on context instead. Yes, scratching your own itch is fine, but sometimes valuable opportunities lie in unknown or underappreciated markets. This is why a few years ago I chose real estate before it got trendy again and despite my limited experience in the area I worked hard to catch up. And yes, growth is good, and it’s the most important metric in emerging markets where the first-mover advantage is still available, but if you’re mistaken and your tech isn’t really transformative, the method may not be very effective.

I’m just as tired of folks who say that explosive growth is always good, as of folks who say that linear growth is intrinsically better. If some strategies work statistically better in context A, and others perform great in context B, your job is to figure which is which, regardless of what the conventional wisdom is telling you. Do that and maybe you’ll stack enough small multipliers in your favor to overcome the dreadful 60% failure rate all entrepreneurs must sooner or later come to terms with.