Small Bets: Ice Cream

Happy (belated) Father’s Day to the dads. Father is a biological term but that’s not really what we celebrate. It’s not the number of kids you have but the kind and kindness you show.

How we measure things matters. In academia it’s p-value. A value of p=.05 means that there’s less than a one in twenty chance the observed effect is due to chance. For studies published in journals read by professors that’s good. But not for real life. Instead we’re looking for anything that works.

That’s what Sam Walton did we he started Walmart. As Charlie Munger notes, Walton invented almost nothing we might think of when we think of Walmart. Instead he copied the best from everyone else then stacked, piled, or implemented it himself. Walton once bragged that no one had been in more Kmart stores than he had. One time he was walking down the aisle of Costco taking notes on his ubiquitous notepad when the store manager asked him to leave. That was Sam Walton.

Not all the ideas were good but none were fatal. One time Walton borrowed $1,800 for an ice cream machine and popcorn maker. They grabbed attention and got people into the story. But he wrote: "Every crazy thing we tried hadn't turned out as well as the ice cream machine, of course, but we hadn't made any mistakes we couldn't correct quickly, none so big they threatened the business."

These emails will not be statistically significant in the academic sense. These will be stories. There will be survival bias. There will be irrelevant, apocryphal, and wrong things. That’s okay too, because a change in POV is worth 40IQ.