Nothing is ever as risky as you think it is(unschooled.org)
unschooled.org
Nothing is ever as risky as you think it is
http://www.unschooled.org/2011/03/what-sam-altman-taught-me-about-risk/
6 comments
Asking a woman out. Giving a lightning talk at a conference. Shutting down a website to drastically change direction. Launching a product most people will call a "toy" or "feature."
You're right that there are objective downsides to startups (e.g., time sunk into something that doesn't pan out), but the lower bound is known and, to me at least, not that bad. Working on a startup that fails isn't like shorting stocks (which has a theoretically unlimited downside). In fact, I'd argue the worst case is many times better than working two years at Microsoft or Google, at least in terms of personal growth and development.
You're right that there are objective downsides to startups (e.g., time sunk into something that doesn't pan out), but the lower bound is known and, to me at least, not that bad. Working on a startup that fails isn't like shorting stocks (which has a theoretically unlimited downside). In fact, I'd argue the worst case is many times better than working two years at Microsoft or Google, at least in terms of personal growth and development.
I founded a startup that failed and then worked for Google for 2 years (and counting...). I'd say they were about equal in terms of personal growth and development, but taught me very different things. Failing at a startup taught me a lot about myself, what I really value and want to do, what my tolerance for ambiguity and stress and risk is, and so on. Working for Google taught me a lot about the world, what other people value and want to do, user expectations and how they'll never be satisfied, plus a whole bunch of technical skills. Hopefully, combining them together means the next startup will succeed. :-)
It doesn't have to be an either/or. There's plenty of time to both fail at a startup and work a couple years at Google.
It doesn't have to be an either/or. There's plenty of time to both fail at a startup and work a couple years at Google.
The market is a very complicated, dynamic system, and the best you can do is run experiments to try and figure out how some small part of it works. It's only a waste of time if you construct poor experiments: otherwise, failure just gives you some more information about the system. With this new information, you can go and try something more likely to be successful.
A related trick is to keep the scope of your experiments small so you can feed that information back into the development of future experiments very quickly. (cf. Col. John Boyd's "Patterns of Conflict")
A related trick is to keep the scope of your experiments small so you can feed that information back into the development of future experiments very quickly. (cf. Col. John Boyd's "Patterns of Conflict")
I don't agree with your view of productivity. You seem short term focused.
Spent 2 years as an online poker player, you learn that your short term productivity is an illusion. What is most important is a type of effort that produces long term gains. With that perspective you become better at prioritizing and understanding what both you and those around you (customers, investors) want. So the only way to be "unproductive" is to not follow through thoroughly on what you are doing now.
But you need to be smart enough to get out when the long term is, as we say in poker, -EV (http://en.wikipedia.org/wiki/Expected_value)
Spent 2 years as an online poker player, you learn that your short term productivity is an illusion. What is most important is a type of effort that produces long term gains. With that perspective you become better at prioritizing and understanding what both you and those around you (customers, investors) want. So the only way to be "unproductive" is to not follow through thoroughly on what you are doing now.
But you need to be smart enough to get out when the long term is, as we say in poker, -EV (http://en.wikipedia.org/wiki/Expected_value)
You just didn't get the overall idea of the post.
Talking to a woman at the supermarket has the inherent "risk" of being ridiculed, while having the obvious objective upside that it might get you laid - or at least makes you a more confident person. In the same way (now regarding business), pouring time and money into a startup has the inherent risk of said startup going under (and losing some past time and/or money), while the obvious objective upside that if the company makes it big, you're a billionaire. Hell even if it doesn't you've earned experience you can apply in your future endeavors, and you didn't have to listen to 7am lectures at the local college for four years to get to not learn even a tenth of what you learn failing at building a startup.
Talking to a woman at the supermarket has the inherent "risk" of being ridiculed, while having the obvious objective upside that it might get you laid - or at least makes you a more confident person. In the same way (now regarding business), pouring time and money into a startup has the inherent risk of said startup going under (and losing some past time and/or money), while the obvious objective upside that if the company makes it big, you're a billionaire. Hell even if it doesn't you've earned experience you can apply in your future endeavors, and you didn't have to listen to 7am lectures at the local college for four years to get to not learn even a tenth of what you learn failing at building a startup.
What about doing drugs, having an affair with your secretary or trading in "hedged" derivatives that could only lose money if the entire housing market faced a downturn?
The point is not that there are no risky things but that many things we perceive as risky aren't objectively so. The things you list are all indeed objectively risky.
Losing your own money is in the same category as having people laugh at you. It feels awful, and indirectly it can reduce your chances of survival, but it doesn't actually harm you physically like a head injury.
What about doing drugs?
Also (for many drugs) not as risky as most people think.
Also (for many drugs) not as risky as most people think.
have you factored in your (assuming you're in the US) rather brutal judicial system?
Depends on the people. I've heard the same drug referred to as both "deadly in 100% of cases" and "actually beneficial to long-term health". The actual science says it's detrimental to long-term health, but only modestly.
Did you read the article? Your comment seems based on the headline, not the content.
Well, the headline is sensationalistic and utterly wrong, so maybe it deserves criticism.
The first two activities are pretty safe, and the third activity is safe as long as most of your assets are protected in bankruptcy (and/or you are a shell corporation with a tiny amount of capital relative to the capital base it is drawn from).
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there may in fact be correlation between doing those things and being successful. and it is possible that both are caused by lowered perceptions of risk. I think I read at some point that people who commit suicide but survived were more statistically successful and one possible cause was their lowered perception of risk (but can't currently find source)
This is terrible advice. There are almost always unexpected unknowns.
There's a human (irrational) bias to be risk averse, but that doesn't mean it's always safer than we think. We also have selection bias as a counterpoint. There are plenty of similar posts with the opposing view based on the later bias, too.
Instead, let's try to be more rational and understand probability:
Probability Theory: The Logic of Science http://bayes.wustl.edu/etj/prob/book.pdf (draft)
http://www.amazon.com/Probability-Theory-Logic-Science-Vol/d...
There's a human (irrational) bias to be risk averse, but that doesn't mean it's always safer than we think. We also have selection bias as a counterpoint. There are plenty of similar posts with the opposing view based on the later bias, too.
Instead, let's try to be more rational and understand probability:
Probability Theory: The Logic of Science http://bayes.wustl.edu/etj/prob/book.pdf (draft)
http://www.amazon.com/Probability-Theory-Logic-Science-Vol/d...
good short article
he's totally right in how he contrasts asking someone out vs riding a motorcycle without helmet. and yes, starting a company has little physical downside (if crafted with reasonable caution, by doing things like minimizing expenses early until business model proven, etc) but a huge potential physical upside (great wealth and freedom).
he's totally right in how he contrasts asking someone out vs riding a motorcycle without helmet. and yes, starting a company has little physical downside (if crafted with reasonable caution, by doing things like minimizing expenses early until business model proven, etc) but a huge potential physical upside (great wealth and freedom).
Sounds like something from lesswrong.com
There is a phrase I have used often: "Nothing is as good, or as bad, as it first appears."
Similarly, "Nothing is as risky, or as safe, as it first seems."
Also, I disagree with his dismissal of subjective risk. If taking a particular action feels bad to you, then it feels bad. A better course than trying to deny that would be to learn to accept your feelings but to go on in spite of them. Feelings are much easier to change over the longer term, usually by short term acceptance - your unconscious will eventually realize that the feelings are overblown (if they are) and you will come to react less strongly with repetition, over time.
Similarly, "Nothing is as risky, or as safe, as it first seems."
Also, I disagree with his dismissal of subjective risk. If taking a particular action feels bad to you, then it feels bad. A better course than trying to deny that would be to learn to accept your feelings but to go on in spite of them. Feelings are much easier to change over the longer term, usually by short term acceptance - your unconscious will eventually realize that the feelings are overblown (if they are) and you will come to react less strongly with repetition, over time.
Regarding risk perception, I've always liked this quote from the book 'Adventures of a Dead Sea Smuggler' by Henry de Moinford:
"There was no use worrying about the possible difficulties to come, they always loom very large and terrible in the distance, but when one arrives at the foot of a wall there is always some foothold that enables one to climb it."
"There was no use worrying about the possible difficulties to come, they always loom very large and terrible in the distance, but when one arrives at the foot of a wall there is always some foothold that enables one to climb it."
Also: A lot of what makes it hard to be a founder is not the shame of failure, but knowledge of lost time. If my company goes under, I'm not as disappointed in my lack of success as I'm disappointed in time not spent more productively elsewhere. There's a subtle distinction there.