The Misconception: You Should Focus on the Successful if You Wish to Become Successful.
The Truth: When failure becomes invisible, the difference between failure and success may also become invisible.
(See the picture).
This is a picture tracking bullet holes on Allied planes that encountered Nazi anti-aircraft fire in WW2.
At first, the military wanted to reinforce those areas, because obviously that's where the ground crews observed the most damage on returning planes.
Until mathematician Abraham Wald pointed out that this was the damage on the planes that made it home and the Allies should armor the areas where there are no dots at all, because those are the places where the planes won't survive when hit.
This phenomenon is called survivorship bias.
A logic error where you focus on things that survived when you should really be looking at things that didn't.
Here's some more examples:
Steve Jobs, Bill Gates, and Mark Zuckerberg dropped out of college and became millionaires, so will I.
If I read the biographies of the world’s most successful entrepreneurs, I’ll understand how to be successful.
If I pattern my company after Warby Parker, I’ll be successful.
My product is better than their product, so I’ll succeed.
Sales team X used these email templates to increase close rates by 35%. I’ll use these templates and get the same results.
I’ll calculate ARR based on our current customers.
If I focus on my unhappy customers, I’ll be able to retain them and decrease my churn rate.
Our customers are requesting these features, we should add them to our product/service.
You’re in business to succeed.
You've probably read your fair share of success stories.
So what’s the problem here?
Anyone thinking about becoming an entrepreneur has looked at these mega-millionaires and tried to discern a pattern to their success.
Some invested all their money while others like Mark Zuckerberg, Jack Dorsey, and Travis Kalanick dropped out of college to pursue their dream.
As simple as those options might seem, following those paths ignore the fact that for as many people who did that and succeeded, there are just as many who did that and failed.
It is common for us all to draw comparisons (often frustrated and unhealthy ones) with other apparently more successful individuals and businesses.
If you find yourself in that situation, it’s wise to:
Recognize that what works for one person may not work for another.
Entrepreneurs like Richard Branson deserve respect but their highly quotable anecdotes are seized upon by many entrepreneurs as guaranteed formulas for success.
For every Richard Branson, there are one thousand wannabes who tried to copy him and failed.
Be highly skeptical of individual gurus and books, podcasts or other resources that appear to give you the ‘answer’ or ‘secret formula’ for achieving wealth, success and happiness.
Recognize that luck plays a huge role in success, though the path is always obvious in hindsight.
It is well recognized that successful people often fall foul of the narrative fallacy, overplaying the role that skill had in their success and underplaying the role of luck.
If you spend your life only learning from survivors, buying books about successful people and pouring over the history of companies that shook the planet, your knowledge of the world will be strongly biased and enormously incomplete.
As best I can tell, here is the trick:
When looking for advice, you should look for what not to do, for what is missing, but don’t expect to find it among the quotes and biographical records of people whose signals rose above the noise.
They may have no idea how or if they lucked up.
Survivorship bias was and is my main calibrating tool.