In psychology, we talk often about the survivorship bias: the tendency of people to focus on winners, rather than losers, as a way of trying to insure future wins. The prototypical example is airplanes in war (one used in a great recent post on the topic): if you want to figure out how to keep planes from getting shot down, don’t look at where the holes are, look at where the holes aren’t (because you can presume that the planes with holes in those places didn’t make it back alive).
But there is actually a larger trend here than just losses and wins. In my traditional style, I’ll call it a true two-by-two matrix: expectation given resources and outcome. That is, some winners seem to have been always meant to win, like a startup that of experienced people with a solid idea and good funding. When they succeed, we’re not shocked. Ditto the reverse, like people born into poverty who stay in poverty.
The problem with those two groups is that they rarely tell us anything interesting: we look at them, apply our existing knowledge of winners and losers, and our expectations are confirmed. It is the other opposing corners of the matrix that always teach me the most, both with startup teams and individuals.
First, there are “those who lose, despite having everything they need to win.” Occasionally, I’ll see startups who just seem to have it all figured it out: market fit, resources, team. And then I watch them struggle and fail to gain traction and die out. We rarely dissect these losses, as a startup community, often because it is hard to do so: ours is a way in which the bodies quickly disappear as the limbs crawl off in separate directions to do other things. And yet I think these failures are the ones that are most interesting, because rather than confirming what we already know about what makes teams succeed or fail, it hints at new variables that we should take into account, things we may have missed. I think of this group as the falling angels, divine right up to the moment that they crash headfirst into the ground.
And there is, of course, the reverse: “those who win, despite having everything they need to lose.” Here are our rising apes, teams that seem destined to fail so utterly and completely, and then they succeed and leave everyone wondering why they didn’t invest. They too hint at variables as yet unmeasured, despite our fervent desire to right them off as simply luck. Luck is actually how most people explain both groups, because a serious study of them would force us to reevaluate our worldview, which is pretty much the antithesis of what our brain is designed to do. We love the path of least resistance, which is at the heart of the survivorship bias: the winners win because they were always going to win, the losers lose because they were always going to lose, and our desire to confirm that means studying only living winners and dead losers.
Fortunately, we have science, which demands that we draw out the two-by-two’s and investigate all four quadrants. So look around, all you who say you believe in The Method – there are lessons in the fallen angels and all those rising apes.