To Fail Seven Times, Plus or Minus Two
A decision framework emphasizing investment in people capable of multiple career pivots, prioritizing optionality and open-ended payoffs over rigid business plans, and adopting a barbell strategy to manage risk.
THE IDEA
To Fail Seven Times, Plus or Minus Two
Let me stop to issue rules based on the chapter so far. (i) Look for optionality; in fact, rank things according to optionality, (ii) preferably with open-ended, not closed-ended, payoffs; (iii) Do not invest in business plans but in people, so look for someone capable of changing six or seven times over his career, or more (an idea that is part of the modus operandi of the venture capitalist Marc Andreessen); one gets immunity from the backfit narratives of the business plan by investing in people. It is simply more robust to do so; (iv) Make sure you are barbelled, whatever that means in your business.
When to use it
Evaluating startup founders for venture capital funding.
Designing a personal career strategy that balances stability with exploratory side projects.
Restructuring a company's R&D portfolio to include both safe bets and high-risk, high-reward experiments.
Choosing between a fixed business plan and an agile, adaptive strategy in a volatile market.
FROM THEORY TO EVERYDAY LIFE
In practice
Venture Capital Decision
A venture capitalist compares Startup A, which has a detailed 5-year plan, with Startup B, whose founder has changed fields several times. The framework directs attention to adaptability and available options. Neither a detailed plan nor career pivots alone establishes which startup is the better investment.
Personal Career Planning
A career barbell could pair a dependable income source with limited experiments in consulting, teaching, or a side project. The protected base matters: several uncertain jobs do not automatically provide downside protection. The experiments offer upside only if their costs remain manageable.
A MOMENT TO REFLECT
Put it to work.
How can you assess a person's capacity for multiple career pivots when interviewing for a leadership role?
What is the optionality in your current investment portfolio, and how can you shift towards open-ended payoffs?
Identify a situation where you followed a rigid plan and later regretted not having a barbell approach. What would you do differently?
CONTINUE THE CONVERSATION
Source texts
- Antifragile (Nassim Nicholas Taleb)