How Good Are You At ‘Pattern Matching’ ?January 30, 2013 3:47 am
The one good thing of watching panel discussions is this: In the middle of a discussion that is progressing on expected lines, someone says something that would be very obvious when you hear it – but it would be an absolute gem if you really think about it. We picked this up from Joe Kraus in a panel discussion – that Venture Capitalists are basically pattern matchers – they have a good datastore in their mind, of what has succeeded in the past, and when they evaluate anything new, they try to look for patterns – good team / product evolves from own need / looks like a play thing – anything that basically matches a successful pattern that they have seen in the past. If there is a match, they invest.
We realized that there are bigger lessons in that statement – pattern matching is a critical skill that needs to be developed and exercised, outside of investing as well – for example, when you try to validate an idea yourself. Or, when you are trying to recruit someone. Or, when you are trying to evaluate a particular technology. Remember, this is not a simple ‘we have experienced this in the past’ thing: we are talking about observing in good detail, specific characteristics / events that set off a pattern match. This is not a ‘we have seen this movie and it does not end well’ thing – but it is close.
PG’s complete set of heuristics (see Startup Ideas) is based on such pattern matching. Pattern matching in fact becomes essential in a setup like YC, but it is not very obvious that this skill is critical for individuals as well. The mind blurs the past: you do remember that the food was good at that diner – but you probably do not remember what was good. And most definitely you have not noticed this pattern, in spite of visiting that particular diner many times, that when tomato soup is ‘not available’, for some reason, the food turned out to be not so good.
Such pattern matching does not come to us naturally. But it is a terrific skill, one that must be developed by paying careful attention to the things that matter to us. If VCs can pattern match to determine which teams / ideas will succeed, maybe we can pattern match to find out which actions will take us closer to success as well.