Smartcuts: How Hackers, Innovators, and Icons Accelerate Success
Shane Snow
Introduction: “How Do They Move So Fast?”
Most large businesses stop growing after a few years. Formal education, in many cases, is so slow or out-of-date that venture capitalists pay bright people to skip school and start Internet companies. Conventional wisdom—outside of the technology industry—on innovation and career building has hardly evolved since the 19th century. We’re multiplying our capabilities as a civilization and yet we still accept the notion that important societal progress, like combating inequality and crime—or even innovating in government and medicine—must take generations. Despite leaps in what we can do, most of us still follow comfortable, pre-prescribed paths. We work hard, but hardly question whether we’re working smart. On the other hand, some among us manage to build eBay in the time it takes the rest of us to build a house. Pick your era in history and you’ll find a handful of people—across industries and continents—who buck the norm and do incredible things in implausibly short amounts of time. The common pattern is that, like computer hackers, certain innovators break convention to find better routes to stunning accomplishments. The question is, can finding these better routes be taught?
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Date: June 3, 2016 |
Part I: Shorten
You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose. —D R . S EUSS
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Date: June 4, 2016 |
The players eliminated resistance by breaking the big challenge (acquire something valuable like a TV) into a series of easier, repeatable challenges (make a tiny trade). Researchers call this the psychology of “small wins.” Gamblers, on the other hand, would call it a “parlay,” which the dictionary defines as “a cumulative series of bets in which winnings accruing from each transaction are used as a stake for a further bet.” In Bigger or Better, the parlay never stops. Players don’t wait an arbitrary period of time before moving on to the next trade, and they don’t mind if the result of a trade was only a slightly more desirable object, so long as the game keeps moving
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Date: June 5, 2016 |
A series of wins at small but significant tasks, however, reveals a pattern that may attract allies, deter opponents, and lower resistance to subsequent proposals .” “Once a small win has been accomplished,” Weick continues, “forces are set in motion that favor another small win.” From the outside, this simply seems like a prudent way to climb the ladder: as fast as possible, * and in small bites. While that’s good advice, the key to the bored Mormon students’ success was not just their rapid cycle time. It was the direction they traded: sideways . The players didn’t simply parlay toothpicks for pieces of wood of increasing size; they traded toothpicks for pens and mirrors for old bikes. They didn’t wait around for the owners of a vacant house to show up, so they could ask for a trade, and they didn’t knock on the same door over and over until a “no” became a “yes.” When a door was shut to them, they immediately picked another one. When the ladder became inefficient, they hacked it. And that is what made them successful so quickly. The key to Bigger or Better, in other words, is the “or.”
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Date: June 5, 2016 |
When we look at fast success in business and other fields, we see this cheetah behavior everywhere: One of the fastest-selling and transformative cellular phones in the world—the iPhone—was introduced by a personal computer company, at a time when the phone market was dominated by telecommunications firms. Nintendo began its life printing Japanese playing cards; the company brokered in taxis, instant rice, and hotels before it saw opportunity in the emerging American arcade scene.
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Date: June 7, 2016 |
This is often how “overnight success” happens for entertainers and public figures; they work hard in their field, then switch ladders and level up, to observers’ surprise.
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Date: June 7, 2016 |
Business research shows that this kind of ladder switching generally tends to accelerate a company’s growth. Companies that pivot—that is, switch business models or products—while on the upswing tend to perform much better than those that stay on a single course.
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Date: June 7, 2016 |
All ten of the top ten presidents in C-SPAN’s survey were hackers. Only one, JFK, climbed a semblance of a traditional ladder; he served in both houses of Congress, but was a war hero and author of a Pulitzer Prize–winning book—clearly not the average ladder climber.
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Date: June 7, 2016 |
Each of the men on this list worked hard in his career, learned and proved leadership through diverse experiences, and switched ladders multiple times. They continuously parlayed their current success for something more, and they didn’t give up when they lost elections (which most of them did). The ladder switching made them better at getting elected and better at the job. To be a good president, Wead says, “You’ve got to be able to think on your feet.” Stubbornness and tradition make for poor performance—as we see with Andrew Johnson and other presidents at the bottom of history’s rankings.
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Date: June 7, 2016 |
The fact that our best presidents—and history’s other greatest overachievers—circumvented the system to get to the top speaks to what’s wrong with our conventional wisdom of paying dues and climbing the ladder. Hard work and luck are certainly ingredients of success, but they’re not the entire recipe.
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Date: June 7, 2016 |
W E LIVE IN AN age of nontraditional ladder climbing. Not just in politics, but in business and personal development and education and entertainment and innovation. Traditional paths are not just slow; they’re no longer viable if we want to compete and innovate.
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Date: June 7, 2016 |
That’s great news, because throwing out the dues paradigm leads us toward meritocracy. But to be successful, we need to start thinking more like hackers, acting more like entrepreneurs. We have to work smarter, not just harder.
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Date: June 7, 2016 |
how Sinatra-style credibility and ladder switching—always parlaying for something more—are the foundation for how the most interesting people and companies in the world succeed. It’s not just how presidents get to the top. It’s how CEOs and comedians and racecar drivers hone their skills and make it in the big leagues. It’s how new businesses grow fast, and old businesses grow faster. It’s how entrepreneurs create life-changing products in record time and inventors parlay dreams for bigger dreams.
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Date: June 7, 2016 |
Hacking the ladder is the mind-set they use to get places. The rest of this book is about becoming good enough to deserve it.
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Date: June 7, 2016 |
Mentorship is the secret of many of the highest-profile achievers throughout history. Socrates mentored young Plato, who in turn mentored Aristotle. Aristotle mentored a boy named Alexander, who went on to conquer the known world as Alexander the Great
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Date: June 26, 2016 |
The mentor story is so common because it seems to work—especially when the mentor is not just a teacher, but someone who’s traveled the road herself. “A master can help you accelerate things,”
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Date: June 26, 2016 |
Business research backs this up, too. Analysis shows that entrepreneurs who have mentors end up raising seven times as much capital for their businesses, and experience 3.5 times faster growth than those without mentors. And in fact, of the companies surveyed, few managed to scale a profitable business model without a mentor’s aid.
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Date: June 26, 2016 |
History, it turns out, is full of people who’ve been lucky enough to have amazing mentors and have stumbled anyway. Indeed, equal amounts of research support both assertions: that mentorship works and that it doesn’t.
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Date: June 26, 2016 |
A FTER TRAINING WITH MASTER handover artists, the GOSH team created a life-saving shift at the hospital. The Formula 1 mentorship clearly worked out for them, and probably better than if the doctors had asked handover experts from another hospital for help. But what about the training made it work, especially when so many other mentorship relationships don’t?
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Date: June 26, 2016 |
The statistics showed that businesspeople who were mentored in the workplace tended to achieve slightly more at work, on average, than those who didn’t. Counterintuitively, however, “Informal mentoring,” Underhill found, “produced a larger and more significant effect on career outcomes than formal mentoring.”
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Date: June 26, 2016 |
The mentorship study data conflicted, it turned out, because of the difference between structured mentoring programs, which were less effective, and mentorship that happened organically. In fact, one-on-one mentoring in which an organization formally matched people proved to be nearly as worthless as a person having not been mentored at all. However, when students and mentors came together on their own and formed personal relationships, the mentored did significantly better, as measured by future income, tenure, number of promotions, job satisfaction, work stress, and self-esteem.
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Date: June 26, 2016 |
O UR TYPICAL PARADIGM FOR mentorship is that of a young, enterprising worker sitting across from an elderly executive at an oak desk, engaging in Q&A about how to succeed at specific challenges. On the other hand, a smartcut-savvy mentee approaches things a bit differently. She develops personal relationships with her mentors, asks their advice on other aspects of life, not just the formal challenge at hand. And she cares about her mentors’ lives too.
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Date: June 26, 2016 |
Business owner Charlie Kim, founder of Next Jump and one of my own mentors, calls this vulnerability. It’s the key, he says, to developing a deep and organic relationship that leads to journey-focused mentorship and not just a focus on practice. Both the teacher and the student must be able to open up about their fears, and that builds trust, which in turn accelerates learning.
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Date: June 26, 2016 |
The best mentors help students to realize that the things that really matter are not the big and obvious. The more vulnerability is shown in the relationship, the more critical details become available for a student to pick up on, and assimilate. And, crucially, a mentor with whom we have that kind of relationship will be more likely to tell us “no” when we need it—and we’ll be more likely to listen.
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Date: June 26, 2016 |
How can building deep relationships with master mentors be a smartcut if it hinges on our being lucky enough to know the master? Hip-hop icon Jay-Z gives us a clue in one of his lyrics, “We were kids without fathers . . . so we found our fathers on wax and on the streets and in history. We got to pick and choose the ancestors who would inspire the world we were going to make for ourselves.” In ancient Greece, few people had access to the best mentors. Jay-Z didn’t either, but he had books from which he could get an inkling about what those kinds of mentors were like. With every increase in communication, with every autobiography published, and every YouTube video of a superstar created, we increase our access to the great models in every category. This allows us to at least study the moves that make masters great—which is a start.
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Date: June 27, 2016 |
As we’ve learned, mentorship doesn’t always yield success. But when we look at superlative success stories throughout history, the presence of an in-person mentor (in Jimmy’s case his manager) or a world-class, long-distance mentor (in Jimmy’s case, great comedians whom he copied) with whom the mentee has a deep, vulnerable relationship is almost always manifest. The smartcut is the same:
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Date: June 27, 2016 |
The billion-dollar micro-blogging service Tumblr earned its founder, 26-year-old David Karp, $200 million in 2013, after six years of hard work. But it was in the second year that everything changed; that was when Karp brought in his personal mentor and friend, tech executive John Maloney, to guide him and the Tumblr rocket ship to maturity. This story is a repeat of that of countless other fast-growing companies.
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Date: June 27, 2016 |
Obviously, in some settings, failure can be catastrophic if we don’t do things right the first time (for example, landing on an aircraft carrier or building a nuclear power plant), he says. But with many things, the actual, long-term consequences of failure are negligible. Anyone who’s started a business, gotten a great job, won political office, or invented something did so in the face of risk. Yet our survival instinct is to minimize the likelihood of bad things happening to us. In business, the more socially acceptable it is to fail, the more likely smart people will try crazy things, the geeks argue
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Date: June 28, 2016 |
If you’re not failing you are either very lucky, very good, or not pushing the boundaries enough,” Staats says. Fortunately, as startup culture spreads, and the Facebook generation grows up, the global social stigma around starting a business and failing—and failure in general—has decreased. This destigmatization actually makes failure less risky.
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Date: June 28, 2016 |
It turns out that after you adjust for statistical margin of error, an entrepreneur who’d failed in a previous venture was not likely to do better than someone who’d never run a business in her life. Expecting to be suddenly great at business after running one into the ground is akin to losing the first basketball game you ever played and expecting to win the next game because you lost the first one.
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Date: June 28, 2016 |
According to the study, successful entrepreneurs, on the other hand, are 50 percent more likely to succeed in a second venture. The more you win, the more likely you are to win again
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Date: June 28, 2016 |
It turns out that the surgeons who botched the new procedure tended to do worse in subsequent surgeries. Rather than learning from their mistakes, their success rates continuously declined. On the other hand, when surgeons did well on the new surgery, more successes tended to follow. Just like the startups in the Compass and Harvard studies.
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Date: June 28, 2016 |
It was indeed a paradox. Screwups got worse. When colleagues screwed up, observers got better. When a doctor succeeded, she did better on her subsequent surgeries. When her colleagues did well, it didn’t affect her.
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Date: June 28, 2016 |
Staats concluded that this coping mechanism was itself responsible for the paradox. He and his colleagues called this attribution theory. The theory says that people explain their successes and failures “by attributing them to factors that will allow them to feel as good as possible about themselves.”
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Date: June 28, 2016 |
“When interpreting their own failures,” Staats explains, “individuals tend to make external attributions, pointing to factors that are outside of their direct control, such as luck. As a result, their motivation to exert effort on the same task in the future is reduced.”
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Date: June 28, 2016 |
Even though an individual failure experience may contain valuable knowledge,” Staats says, “without subsequent effort to reflect upon that experience, the potential learning will remain untapped
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Date: June 28, 2016 |
This is a survival mechanism. We externalize our mistakes because we need to live with ourselves afterward. We have no problem assuming responsibility for our successes, though, even if we don’t brag about them. Staats explains, “People tend to attribute their own success to their effort and ability. Since they have control over their own effort and actions, these attributions motivate them to exert effort in subsequent tasks so that they can continue improving and learning.” This made the successful doctors better and better
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Date: June 29, 2016 |
The research showed that experts—people who were masters at a trade—vastly preferred negative feedback to positive. It spurred the most improvement. That was because criticism is generally more actionable than compliments. “You did well” is less helpful in improving your bowling game than “You turned your wrist too much.”
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Date: June 29, 2016 |
Crucially, experts tended to be able to turn off the part of their egos that took legitimate feedback personally when it came to their craft, and they were confident enough to parse helpful feedback from incorrect feedback. Meanwhile novices psyched themselves out. They needed encouragement and feared failure.
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Date: June 29, 2016 |
The tough part about negative feedback is in separating ourselves from the perceived failure and turning our experiences into objective experiments. But when we do that, feedback becomes much more powerful.
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Date: June 29, 2016 |
The Second City teaches its students to take such things in stride, to become scientists who see audience reaction as commentary on the joke, not the jokester. To turn off the part of their brains that says “I fail” when they get negative feedback. And then the school has students continuously parlay up to harder audiences and harsher feedback as they grow more comfortable. This forces them to both toughen up and push creative boundaries. With this process, The Second City transforms failure (something that implies finality) into simply feedback (something that can be used to improve). Hundreds of times a week.
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Date: June 30, 2016 |
The Silicon Valley mantra “fail often” actually has a second part to it. More often than not, Valley startups will say, “fail fast and fail often.” This gets at the principle of rapid feedback. But failing implies a finality, a funeral, an amen.
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Date: June 29, 2016 |
T HE S ECOND C ITY MANAGES to accomplish three things to accelerate its performers’ growth: (1) it gives them rapid feedback; (2) it depersonalizes the feedback; and (3) it lowers the stakes and pressure, so students take risks that force them to improve.
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Date: June 29, 2016 |
Part II: Leverage
if I can put in 5 percent of the effort of somebody getting an A, and I can get a C minus, that’s amazing,” he explains. “It’s certainly good enough, right? [Then] I can take the other 95 percent of the time and invest it in something I really care about.”
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Date: July 1, 2016 |
The overwhelming majority of academic research about calculators indicates that leveraging such tools improves conceptual understanding. By learning the tool (calculator) first, we actually master the discipline (math) faster. This is the point that Dyson was making earlier. Hands-on learning and the use of tools, he says, helps us to want to learn, to get rapid feedback, and to actually grasp math better than memorizing facts from the bottom up.
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Date: July 1, 2016 |
while we may need deep expertise in our industries to become innovators, we actually need only higher-order thinking and the ability to use platforms to do everything else. In a pre–technology era, people with abstract knowledge were highly valued. But in the age of smartphones and Wikipedia, does it matter that you don’t know offhand the name of the second-largest city in Botswana? What’s important today is knowing how to use platforms to retrieve the information we need, whether it’s the capital of Botswana or the result of 124,502 divided by 8. *
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Date: July 1, 2016 |
In an age of platforms, creative problem solving is more valuable than computational skill. To be good citizens, responsible workers and providers, and ethical businesspeople, we need a minimum level of knowledge about the way the world works, who’s in it, and how things fit together. We need to know enough about statistics to call BS on propaganda. We ought to be able to identify a good deal on a dinner menu. But what all this research tells us is that platforms can help us master those basics faster than learning the basics from scratch.
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Date: July 1, 2016 |
It is better to know how to learn than to know
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Date: July 1, 2016 |
You cannot dig a hole in a different place by digging the same hole deeper
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Date: July 1, 2016 |
You can accelerate your training if you know how to train properly, but you still don’t need to be that special. I don’t think I’m that special of a programmer or a businessperson or a race car driver. I just know how to train.
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Date: July 1, 2016 |
His tire advantage had pushed him ahead of equally skilled drivers, and propelled him to the next level. And like Finland’s higher-level educational environment, the advanced racing leagues themselves became platforms that forced him to master the basics—and faster—than he would have at a lower level
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Date: July 1, 2016 |
Effort for the sake of effort is as foolish a tradition as paying dues. How much better is hard work when it’s amplified by a lever? Platforms teach us skills and allow us to focus on being great, rather than reinventing wheels or repeating ourselves. “You can build on top of a lot of things that exist in this world,” David Heinemeier Hansson told me. “Somebody goes in and does that hard, ground level science based work. “And then on top of that,” he smiles, “you build the art.”
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Date: July 1, 2016 |
Luck is often talked about as “being in the right place at the right time.” But like a surfer, some people—and companies—are adept at placing themselves at the right place at the right time. They seek out opportunity rather than wait for it. This chapter is about hacking that proces
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Date: July 3, 2016 |
There are two ways to catch a wave: exhausting hard work—paddling—and pattern recognition—spotting a wave early and casually drifting to the sweet spot. “There are people who make careers based on the fact that they know how to read the ocean better than others,” says Pat O’Connell, ’90s surfing legend and trainer. “It’s just about knowing the ocean. It’s timing
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Date: July 3, 2016 |
In a given domain—be it surfing or accounting or political fund-raising—the familiarity that leads to pattern recognition seems to come with experience and practice. Fencing masters recognize opportunities in opponents’ moves because of the sheer amount of practice time logged into their heads. Leaders and managers who use their gut to make decisions often do so based on decades of experience, archived and filed away in the folds of their cerebrums. “Intuition is the result of nonconscious pattern recognition,” Dane tells me. However, his research shows that, while logging hours of practice helps us see patterns subconsciously, we can often do just as well by deliberately looking for them. In many fields, such pattern hunting and deliberate analysis can yield results just as in the basketball example—high accuracy on the first try. And that’s where, like the dues-paying presidents or overly patient programmers, what we take for granted often gets in the way of our own success. Deliberate pattern spotting can compensate for experience. But we often don’t even give it a sho
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Date: July 5, 2016 |
This explains how so many inexperienced companies and entrepreneurs beat the norm and build businesses that disrupt established players. Through deliberate analysis, the little guy can spot waves better than the big company that relies on experience and instinct once it’s at the top. And a wave can take an amateur farther faster than an expert can swim.
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Date: July 5, 2016 |
when market and technology growth are smooth and steady, the first mover gets the inertia and an advantage. When industry change is choppy, the fast follower—the second mover—gets the benefits of the first mover’s pioneering work and often catches a bigger wave, unencumbered.
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Date: July 6, 2016 |
A casual observer might conclude that Sonny just happened to be in the right place at the right time, two times. That he was just lucky. But that’s not what happened. Sonny actively experimented with trends when they were still early—the Web, social networks, scream-singing, EDM—sticking his toe in different waters until he recognized incoming waves. And it should be noted that he tried some things that didn’t work (a solo career as a rock singer) and was quick to shift strategies.
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Date: July 7, 2016 |
Conventional thinking leads talented and driven people to believe that if they simply work hard, luck will eventually strike. That’s like saying if a surfer treads water in the same spot for long enough, a wave will come; it certainly happens to some people, once in a while, but it’s not the most effective strategy for success. Paradoxically, it’s actually a lazier move
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Date: July 7, 2016 |
There’s a reason some people practice things for twenty years and never become experts; a golfer can put in 30,000 hours of practice and not improve his game if he’s gripping his clubs wrong the whole time. A business can work five times harder and longer than its neighbors and still lose to rivals that read the market better. Just like a pro surfer never wins by staying in one spot. “I think that being able to pick and read good waves is almost more important than surfing well,” Moore tells me. “If you don’t have a good or better platform to perform on than your opponent, you are going to lose.” Her secret, and Sonny’s (and Google’s and 3M’s and General Motors’), isn’t practice—though that certainly helps. It’s going to the beach to watch the waves and getting into the water to experiment. And if you’re in the sweet spot when that superwave does come, Sonny says, “It’s pure energy.”
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Date: July 7, 2016 |
W HICH IS EASIER — MAKING FRIENDS with a thousand people one by one or making friends with someone who already has a thousand friends? Which is faster—going door to door with a message or broadcasting the message to a million homes at once? This is the idea behind what I call superconnecting, the act of making mass connections by tapping into hubs with many spokes. It’s what Castro needed to do if he ever wanted to convert the Cuban people to his cause.
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Date: July 8, 2016 |
That’s the role that mass media has played in our lives for the past two centuries—superconnecting sources of information to relevant audiences all at once and superconnecting businesses to millions of potential customers through advertising. Before newspapers could reach hundreds of thousands of people in a day and before radio and television and Internet publishing could reach millions at once, there were few national- or international-scale businesses. And there certainly weren’t fast-growing startups and consumer brands in the numbers we see today. But once companies could communicate to many, the number of fast-growing and large-scale businesses in the world skyrocketed
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Date: July 8, 2016 |
a disproportionate number of the most successful people in a given industry are extremely generous. From medical students to engineers to salespeople, his studies find givers at the top of the ladder. “Being a giver doesn’t require extraordinary acts of sacrifice,” Grant writes in Give and Take. “It just involves a focus on acting in the interests of others, such as by giving help, providing mentoring, sharing credit, or making connections for others.” Abrams is known, acquaintances tell me, for his kindness and lack of ego, in addition to his penchant for mystery. That’s how he attracts the best people to his staff. And that’s how he’s managed to climb so far so fast. * Staffers with whom I e-mailed and met at the “typewriter shop” were eager to keep Abrams away from me because, according to his reputation, he’d probably spend way too much time helping this shaggy-haired writer out when he ought to be, you know, filming Star Wars
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Date: July 8, 2016 |
Jack Canfield, from chapter 2, similarly superconnected into networks when he released his book, Chicken Soup for the Pet Lover’s Soul . He partnered with a national pet supply retailer to offer a half-price coupon for the book to anyone who bought a 50-pound bag of dog food. The company promoted the deal across the United States. “The principle was partner up with somebody who is already a gorilla, that has huge reach and impact, and create a win-win,” Canfield explains. Eager for a deal, dog owners bought half a million books—and in the process, a lot of dog food. It was one of the fastest book launches of Canfield’s career.
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Date: July 8, 2016 |
Superconnecting is about learning what people need, then talking about ‘how do we create something of value
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Date: July 8, 2016 |
Mystic energy isn’t the secret to the success of Grant’s givers; just as we learn from Mint, when we give and teach, we build up fan bases that become more likely to support us. And that, actually, was the key component of Che and Fidel’s revolution.
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Date: July 8, 2016 |
, Castro’s revolutionary message reached a massive audience through a superconnector—a radio—but the rebels won the people’s hearts because they showed that they sincerely cared. The movement harnessed the power of the superconnector by giving service as a publisher and educator. J. J. Abrams built his career by collaborating with talented, fast-rising, and well-connected people and by making them look great. And Mint grew business via its own broadcast on the Web, tapping superconnected people and then helping the members of those people’s networks through meaningful content. No matter the medium or method, giving is the timeless smartcut for harnessing superconnectors and creating serendipity. What happens post-serendipity—as we’ll learn in the final part of this book—is where things start to get really interesting
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Date: July 8, 2016 |
Part III: Soar
Many entrepreneurs who rode the wave early and bailed out before it crashed in the early aughts suddenly found themselves in an unfamiliar position: having worked 80-hour weeks at Internet startups for the past few years, they now no longer needed to work at all. Ever . For the millionaires, smart financial planning meant a comfortable life and the freedom to pursue new things. For the billionaires, champagne baths every morning and new Lamborghinis every afternoon couldn’t deplete the fathomless amount of cash on hand. “Your entire philosophy of money changes,” writes author Richard Frank in his book, Richistan . “You realize that you can’t possibly spend all of your fortune, or even part of it, in your lifetime, and that your money will probably grow over the years even if you spend lavishly.” There are dotcom entrepreneurs who could live top 1 percent American lifestyles and not run out of cash for 4,000 years. People who Bill Simmons would call “pajama rich,” so rich they can go to a five-star restaurant or sit courtside at the NBA playoffs in their pajamas. They have so much money that they have nothing to prove to anyone. And many of them are totally depressed
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Date: July 8, 2016 |
You’ll remember the anecdote I shared in this book’s introduction about being too short to reach between the Olympic rings at the playground jungle gym. I had to jump to grab the first ring and then swing like a pendulum in order to reach the next ring. To get to the third ring, I had to use the momentum from the previous swing to keep going. If I held on to the previous ring too long, I’d stop and wouldn’t be able to get enough speed to reach the next ring. This is Isaac Newton’s first law of motion at work: objects in motion tend to stay in motion, unless acted on by external forces. Once you start swinging, it’s easier to keep swinging than to slow down.
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Date: July 8, 2016 |
When businesspeople cash out big, says wealth coach Susan Bradley, “Momentum has been building for a while. Then there’s this moment that it’s over, and all the champagne is gone, and there’s this feeling of this drop into an abyss. It’s like the beams of a house have gone away and you have to build from the inside out. That sense is paralyzing. It actually affects our cognitive functioning.” I’m pretty sure that acquiring a billion dollars would solve all my problems. However, studies show that the wealthy—especially those who fall into it through inheritance or the lottery or sale of a business—are often not happier once they’re rich. A meaningful percentage of them believe that their wealth causes more problems than it solves
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Date: July 8, 2016 |
There were certainly multiple factors contributing to these men’s post-moonwalk slump, but the question What do you do after walking on the moon? became a gigantic speed bump. The trouble with moonwalkers and billionaires is when they arrive at the top, their momentum often stops. If they don’t manage to find something to parlay, they turn into the kid on the jungle gym who just hangs from the ring
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Date: July 8, 2016 |
businesses need to help their workers experience lots of tiny wins.
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Date: July 8, 2016 |
To get out of the funk, say Joan DiFuria and Stephen Goldbart, cofounders of the Money, Meaning & Choices Institute, depressed successes simply have to start the Olympic rings over. Some use their money to create new businesses. Others parlay sideways and get into philanthropy. And others simply pick up hobbies that take time to master. Even if the subsequent endeavors are smaller than their previous ones, the depression dissipates as they make progress. They don’t have to do something Bigger or Better to be happy. They just have to keep moving.
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Date: July 8, 2016 |
Happy astronauts catch waves that lead to the moon, and then use the momentum to switch ladders to fulfilling careers on earth. Depression-avoidant entrepreneurs use levers to get massively rich, then parlay the momentum to build more things.
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Date: July 8, 2016 |
two of his companies went out to raise money from new investors. They were in the same general industry and had the exact same economics. Each company received offers from investors around the same time, wherein the investors determined how “valuable” each business was. Below are the basic financials for each company. See if you can guess which got a better deal: COMPANY A • Year 1 revenues $12M, operating at a $2M loss. • Year 2 revenues $20M, operating at breakeven. COMPANY B • Year 1 revenues $6M, operating at a $2M loss. • Year 2 revenues $20M, operating at breakeven. Though they were both operating at breakeven with the same revenues, investors valued Company B at double the price of Company A, simply because Company B had more momentum. Investors see momentum and future success as so highly correlated that they will take bigger bets on companies with fast-growing user bases even if the companies are bleeding money. Momentum, it turns out, can cover a multitude of sins.
| Location: 128 |
Date: July 8, 2016 |
The Oreo tweet case study proves that the perception of momentum is often as good as momentum. I didn’t personally believe it deserved all the attention it got. And yet, here I am, perpetuating the Oreo tweet even further. That’s the power of momentum
| Location: 129 |
Date: July 8, 2016 |
A S WE’VE LEARNED FROM Michelle Phan’s story, the secret to harnessing momentum is to build up potential energy, so that unexpected opportunities can be amplified. On the playground, it’s like building a tower to stand on, so you can start your Olympic ring with more velocity. Phan’s tower was a backlog of quality content. This is how innovators like Sal Khan (who published 1,000 math lessons online before being discovered by Bill Gates, who thrust him into the spotlight and propelled him to build a groundbreaking digital school called Khan Academy), and musicians like Rodriguez (a folk singer whose amazing, but largely unrecognized music work from the 1970s was featured in a 2012 documentary, which then catapulted him to world fame) became “overnight” successes. None of them were overnight successes. But each of their backlogs became reservoirs, ready to become torrents as soon as the dam was removed.
| Location: 132 |
Date: July 9, 2016 |
She hacked the ladder from blogger to YouTube star to makeup spokesperson to cosmetics designer to entrepreneur. The 30-million-view Lady Gaga tutorial was not Phan’s first great video, but it was her inflection point. She had been winding up for a big swing for a long time. “Success is like a lightning bolt,” Phan once declared in an interview with Mashable . “It’ll strike you when you least expect it, and you just have to keep the momentum going
| Location: 133 |
Date: July 9, 2016 |
S OMETIMES BIGGER IS NOT better. Sometimes more of a good thing is too much. Sometimes the smartest next step is a step back. In the case of neonatal incubators, incrementally bigger and more powerful improvements meant, at the very most, incrementally less expensive (though it was usually the opposite). The hacker’s approach to NICU design was to think smaller. In doing so, Chen’s team created something world class. This teaches us something important about breakthrough success: simplification often makes the difference between good and amazing
| Location: 137 |
Date: July 9, 2016 |
Innovation is about doing something differently, rather than creating something from nothing (invention) or doing the same thing better (improvement)
| Location: 137 |
Date: July 9, 2016 |
when he coined the term “disruptive innovation.” Disruptive innovation is when the introduction of a lower-cost product steals market share from existing players, like when e-mail usurped postal mail (how much would you spend a month if every e-mail cost the price of a postage stamp?) or when Craigslist replaced costly classified newspaper ads with free Internet listings. The key feature of disruptively innovative products is cost savings (either time or money). But the key ingredient behind the scenes of every disruptive product is simplification. E-mail is not just cheaper, but simpler than postal mail. USB flash drives were not just less expensive than compact discs, but simpler to use. And cloud storage became even simpler than flash.
| Location: 137 |
Date: July 9, 2016 |
There are a lot of great inventors and improvers in the world. But those who hack world-class success tend to be the ones who can focus relentlessly on a tiny number of things. In other words, to soar, we need to simplify.
| Location: 138 |
Date: July 9, 2016 |
In a wonderful scene in Sir Arthur Conan Doyle’s A Study in Scarlet , detective Sherlock Holmes chides his companion, Dr. Watson, for explaining to him that the earth revolves around the sun, which Holmes previously did not know. “Now that I do know it I shall do my best to forget it,” Holmes declared to the astonished Watson, a lifelong man of science. “But the Solar System!” protested Watson. “What the deuce is it to me?” said Holmes. “You say that we go round the sun. If we went round the moon it would not make a pennyworth of difference to me or to my work.” Holmes was a first-class noticer. The police leveraged him as the highest platform, if you will, in criminal profiling. His legendary powers of observation and deduction earned him the distinction of Britain’s finest criminal investigator. He got to be the best by focusing on what he needed to know, knowing how to figure out what he didn’t know, and forgetting about everything else
| Location: 139 |
Date: July 9, 2016 |
Like Holmes, hackers strip the unnecessary from their lives. They zero in on what matters. Like great writers, innovators have the fortitude to cut the adverbs.
| Location: 139 |
Date: July 9, 2016 |
, experiments that show that making lots of tiny choices depletes one’s subsequent self-control
| Location: 140 |
Date: July 9, 2016 |
. Those who hadn’t just spent time making decisions performed several times better than those who did. Apparently, patience and willpower, even creativity, are exhaustible resources. That’s why so many busy and powerful people practice mind-clearing meditation and stick to rigid daily routines: to minimize distractions and maximize good decision making.
| Location: 140 |
Date: July 9, 2016 |
Constraints like that in Jane Chen’s “Design for Extreme Affordability” challenge are often the forcing functions that lead to breakthrough innovation. No one had thought to create a radically simple incubator because no one had been tasked with making one for people who live on one dollar a day.
| Location: 140 |
Date: July 9, 2016 |
constraints meant Chen’s team had to throw convention out. And they came up with something more creative than if they’d had an unlimited budge
| Location: 141 |
Date: July 9, 2016 |
Here’s a fact: Creativity comes easier within constraints.
| Location: 141 |
Date: July 9, 2016 |
Constraints make the haiku one of the world’s most moving poetic forms. They give us boundaries that direct our focus and allow us to be more creative. This is, coincidentally, why tiny startup companies frequently come up with breakthrough ideas. They start with so few resources that they’re forced to come up with simplifying solutions.
| Location: 141 |
Date: July 9, 2016 |
Geniuses and presidents strip meaningless choices from their day, so they can simplify their lives and think. Inventors and entrepreneurs ask, How could we make this product simpler? The answer transforms good to incredible. Perhaps that’s why Steve Jobs referred to simplicity as “the ultimate sophistication.” Holmes, on the other hand, would simply call it elementary .
| Location: 142 |
Date: July 9, 2016 |
This has to work.
| Location: 148 |
Date: July 9, 2016 |
Musk realized that in order to gain support for his big vision, he would himself have to step into the public spotlight. In other words, he had to get people to believe . So the geek brushed up on speaking skills and started talking big. This-is-the-future-of-mankind big. He did television appearances and magazine interviews. He told the world he was going to die on Mars.
| Location: 148 |
Date: July 9, 2016 |
Creating your own wave and then catching it is as old as ancient Greece: Alexander III rallied the Macedonians with his hyperbolic quest to reach the “ends of the world and the Great Outer Sea,” conquering the entire Persian Empire along the way.
| Location: 149 |
Date: July 9, 2016 |
Of course, such spotlight-snatching only produces real momentum if there’s substance behind it. Gaga’s music was catchy and fresh. Red Bull had spent years publishing a backlog of high-octane sports content (and selling a popular beverage); the attention from Baumgartner’s jump just solidified the company’s reputation in the action-sports world. Alexander earned himself the title “Great” through his ingenious military tactics, without which his quest would have never worked.
| Location: 149 |
Date: July 9, 2016 |
It’s called “10x Thinking.” 10x Thinking is the art of the extremely big swing. To use a baseball analogy: instead of trying to get on base—or even aiming for a home run—it’s trying to hit the ball into the next town. No amount of weight lifting or swing practice will get you there. Such a goal requires you to think radically different.
| Location: 151 |
Date: July 10, 2016 |
“The way of going about trying to make something new or better often tends to polarize into one of two styles,” Teller says. “One is the low-variance, no surprises version of improvement. The production model, if you will. You tend to get ‘10 percent,’ in order of magnitude, kind of improvements.” “In order to get really big improvements, you usually have to start over in one or more ways. You have to break some of the basic assumptions and, of course, you can’t know ahead of time. It’s by definition counterintuitive.” Incremental progress, he says, depends on working harder. More resources, more effort. 10x progress is built on bravery and creativity instead. Working smarter.
| Location: 151 |
Date: July 10, 2016 |
In other words, 10x goals force you to come up with smartcuts. “I joke that this is a moon-shot factory,” Teller says, of Google[x]. “Our belief is that if you can get people to let go of their fear, and to be more intellectually open, intellectually honest, more dispassionate about being creative, trying new things, and then being honest about what the same amount of time, about the same amount of resources, as making the 10-percent
| Location: 152 |
Date: July 10, 2016 |
Elon Musk calls this “getting to first principles.” In the 1800s 10 percent style thinking for faster personal transportation translated into trying to breed stronger horses. First principles would suggest instead thinking about the physics of forward movement, then building up from there, leveraging the latest technology—like the internal combustion engine. Most “innovation” inside industries and companies today focuses on making faster horses, not automobiles. That’s why so many of us fall victim to the innovator’s dilemma, wherein competitors usurp while we think we’re being innovative. First principles force us to let go of paradigms. “You can trade in a ton of effort in exchange for just the right perspective,” Teller says. He uses the analogy of trying to shoot an arrow through an orchard. “You could shoot an awful lot of arrows trying to get all the way through the orchard. But the really, the best thing to do would be to move around until you got the trees lined up. That process of not spending all of your time shooting the arrows, but trying to reframe the problem . . . is really about bravery, about creativity.”
| Location: 152 |
Date: July 10, 2016 |
But wait, are we just building a case for 10x-style swings based on the word of billionaire-funded crazy people? Academic research actually shows that we’re less likely to perform at our peak potential when we’re reaching for low-hanging fruit. That’s in part because there’s more competition at the bottom of the tree than at the top. And competition in large numbers doesn’t just decrease general odds of winning. It creates underperformance.
| Location: 153 |
Date: July 10, 2016 |
In 2009 behavioral psychologists Stephen M. Garcia and Avishalom Tor showed that merely knowing there are more competitors in a competition decreases our performance. Not relative to a group, but in absolute terms. They call this the N-Effect.
| Location: 153 |
Date: July 10, 2016 |
The N-Effect has been confirmed in other settings as well, such as standardized tests like the SAT and ACT. And while it’s more difficult to conduct controlled experiments for it in business, businesspeople will tell you that the presence of one or two serious rivals is incredibly motivating. When the rivals number in the thousands, it’s a different type of game.
| Location: 153 |
Date: July 10, 2016 |
Brands with lofty purposes beyond making profits wildly outperformed the S&P 500. From 2001 to 2011, an investment in the 50 most idealistic brands—the ones opting for the high-hanging purpose and not just low-hanging profits—would have been 400 percent more profitable than shares of an S&P index fund. Why is this? The simple explanation is that human nature makes us surprisingly willing to support big ideals and big swings. That means more customers, more investors, and more word-of-mouth for the dreamers.
| Location: 154 |
Date: July 10, 2016 |
So there’s evidence both in business and academia to support 10x Thinking. But not every big dream gains followers or comes true. Just because you’re righteous doesn’t mean people will support you. You have to motivate them. You have to tell provocative stories.
| Location: 154 |
Date: July 10, 2016 |
“We need a movement,” Kosta says, to make 10x happen. “You need to get a critical mass of people who give a fuck.” Or, as Musk likes to say, “The first step is to establish that something is possible; then work. The countdown clock marched down to T minus 10 seconds. An idling cloud of white
| Location: 155 |
Date: July 10, 2016 |
“For my part,” he said, “I will never give up. And I mean never.” In an instant, the dark mood flipped. The crew went from despair to excitement. From loss to resolve. They cheered, some with tears in their eyes. Musk had turned the failure into feedback. “Elon walked out with a set of [defibrillator] paddles and was like, ‘Don’t die on me yet!’” Singh says. “He galvanized people in their lowest of lows.” “He just simply doesn’t believe in failure,” Cantrell adds. “And that makes this guy special.” It was an easy fix. A launch failure typically took NASA or others six months to figure out what happened, three months to get a new rocket out on the launch pad, and another two or three to get it certified for flight. With it’s vertically integrated factory and startup spirit, SpaceX found the problem and put the next Falcon 1 on the launchpad in five weeks. And on September 28, 2008, it flew perfectly. *
| Location: 156 |
Date: July 10, 2016 |
Funding was no longer going to be a problem. “Generally speaking, if you’re gonna make something ten percent better than the way things currently are, you better be great in sales and marketing, because you’re gonna have to talk people into changing their behavior for a very marginal increase in value,” explains Astro Teller. “If, on the other hand, you make something ten times better for a large number of people—you really produce huge amounts of new value—the money’s gonna come find you. Because it would be hard not to make money if you’re really adding that much value.” This is exactly what’s happened to SpaceX. As the rockets flew into space, so flew satellite orders into Musk’s office. In focusing on the big vision, SpaceX built something with which it would be hard not to make money.
| Location: 157 |
Date: July 10, 2016 |
People are generally willing to support other people’s small dreams with kind words. But we’re willing to invest lives and money into huge dreams. The bigger the potential, the more people are willing to back it. That’s why Musk was able to win over investors at the last moment when Falcon 1 needed one more shot; they saw the enormous potential upside and they believed in his story. Big causes attract big believers, big investors, big capital, big-name advisers, and big talent. They force us to rethink convention and hack the ladder of success. To engage with masters and to leverage waves and platforms and superconnectors. To swing and to simplify, to quickly turn failure into feedback. To become not just bigger, but truly better. And they remind us, once again, that together we can achieve the implausible.
| Location: 158 |
Date: July 10, 2016 |
Epilogue
You can make incremental progress by playing by the rules. To create breakthrough change, you have to break the rules. Let’s break some big ones together.
| Location: 170 |
Date: July 10, 2016 |