🔤 be different
|Mike Dariano||Nov 6, 2019|
This week is an alphabetical experiment from a long piece of content.
The most valuable business is one that's different from the now but congruent later. Active investors do this rather than buying index funds. Company founders do this rather than continuing as employees. Pivoting companies do this when they change their strategy.
However, this is hard. It takes the right culture to work because when it doesn't work it means failing unconventionally and that introduces career risk as evidenced by the axiom, 'you don't get fired for buying IBM'. Not being different is fine because we're all not-different in a lot of ways. Not-different means low variance in outcomes. Consistently eat a certain way, work a certain way, and interact in a certain way and you will get a consistent result in each of those areas. That's fine. Unless you want inconsistent results, which cut both ways. As Charles Darwin put it, "I am a firm believer that without speculation there is no good and original observation."
Being different works because there's less competition for the same resource, whether supplies, customers, or employees. Usually different also comes with disgust. Some venture capitalists say that they don't even consider ideas unless they sound weird to someone on their team.
The show Seinfeld was successful for a lot of reasons, but part-of-the-reason was because it was different. Jerry Seinfeld said about the early pitches from writers, "They give us all these sitcom ideas. I tell them we don't want sitcom ideas. I tell them what we don't want to do, but it's hard to explain what we do want."
They wanted something different. On Seinfeld, this worked thanks to a decentralized command. After the show wrapped Jerry said, "this is a model that all networks subsequently ignored and never did again, except for HBO. That's a network that hires people that they like and says that's the end of their job."
But Seinfeld wasn't too different. Derek Thompson writes in Hit Makers about the Most Acceptable Yet Advanced (MAYA) theory that suggests cultural hits are different but not too different. There's a Goldilocks zone.
Investor Howard Marks puts it this way: you have to be different and you have to be right. People who choose a conventional path will get conventional results. People who choose the unconventional path will get unconventional results, both positive and negative.
One way to think about different ideas is like a venture capital fund. Multiple investors say that the worst ideas are like a bell curve and most find it 'meh'. Instead, the best ideas are bi-modal, people love it or hate it and few are in the middle.