Do Not Collect Nickels In Front Of Steamrollers

May 25, 2015 10:34 pm

This is from The Black Swan –

“People are often ashamed of losses, so they engage in strategies that produce very little volatility but contain the risk of a large loss—like collecting nickels in front of steamrollers. ”


With tech startups this is an easy trap to fall into when you define your business model. When you evaluate ideas, there is an even bigger chance that you will fall into this trap. Forget the Steamroller – collecting nickels is wrong in the first place.

This gem is from Vinod Khosla: It is a very good idea to place huge bets on projects, as long as the successful scenario is ‘worth it’. The mistake that most VCs and entrepreneurs do, is that they eliminate risk so much, that in the process, they reduce the ‘impact’ of the project. This reduces the consequences of success greatly – in other words, success becomes inconsequential. Not a preferred outcome. Do Not Make Success Inconsequential.

Do Not Collect Nickels. Steamrollers or not, it is a bad idea.

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