Great question! I am not sure I have the best answer, but experience of course does help.
The premise of my argument here is that early stage luck is about whether the bets you make land, or not. All early stage companies are bets, so having yours pay off includes some element of luck even if you are really good and informed.
If we take a casino analogy: the best bet in the casino is the pass line in craps. The odds of that bet paying off is (I believe) 51% — meaning that over time you have a 2% advantage over the casino. But you will still lose that bet 49% of the time.
In the context of a startup, the odds of your bet being right will wildly vary — but the industry average is that like 80% of startups just totally fail. You can increase your odds of success through a number of things — such as experience as a serial founder, or maybe your unique insight into a specific problem.
There are a lot of ways to ski that cat, but I think the summary is "the more specific expertise/knowledge that informs your bet, the better you can tilt the odds in your favor." And increasing your chance of success from 20% to 30% or 50% is a big deal.
But even then — there is no sure thing in betting, regardless if you bet in a casino, on the stock market, or on a startup.
Nick, luck as timing or luck as alchemy are both great metaphors. Building a successful company is a lot like achieving outlier success – and any way you slice it, it's hard to achieve outlier success without a healthy dose of good luck. In some cultures, moms pray for their kids to be lucky – that ancient wisdom is onto something.
Nick's blog is quickly becoming one of my favorites. I don't typically see such candid reflections from founders. This is the kind of content that builds trust with investors. Not enough people write about how to construct luck. In my findings from sales, it's a sh*tload of at-bats, knowing how to hear someone's "no" and helping them find it quickly, and only going where you're celebrated (not where you're tolerated).
Nick - what do you think drives the early stage luck?
Does luck come around easier as a repeat founder, who has a better network and experience?
Great question! I am not sure I have the best answer, but experience of course does help.
The premise of my argument here is that early stage luck is about whether the bets you make land, or not. All early stage companies are bets, so having yours pay off includes some element of luck even if you are really good and informed.
If we take a casino analogy: the best bet in the casino is the pass line in craps. The odds of that bet paying off is (I believe) 51% — meaning that over time you have a 2% advantage over the casino. But you will still lose that bet 49% of the time.
In the context of a startup, the odds of your bet being right will wildly vary — but the industry average is that like 80% of startups just totally fail. You can increase your odds of success through a number of things — such as experience as a serial founder, or maybe your unique insight into a specific problem.
There are a lot of ways to ski that cat, but I think the summary is "the more specific expertise/knowledge that informs your bet, the better you can tilt the odds in your favor." And increasing your chance of success from 20% to 30% or 50% is a big deal.
But even then — there is no sure thing in betting, regardless if you bet in a casino, on the stock market, or on a startup.
Nick, luck as timing or luck as alchemy are both great metaphors. Building a successful company is a lot like achieving outlier success – and any way you slice it, it's hard to achieve outlier success without a healthy dose of good luck. In some cultures, moms pray for their kids to be lucky – that ancient wisdom is onto something.
Ancient wisdom for the win
Nick's blog is quickly becoming one of my favorites. I don't typically see such candid reflections from founders. This is the kind of content that builds trust with investors. Not enough people write about how to construct luck. In my findings from sales, it's a sh*tload of at-bats, knowing how to hear someone's "no" and helping them find it quickly, and only going where you're celebrated (not where you're tolerated).