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Failure to plan
but am I planning for failure?
Last week I said I would share about my strategy to not plan. So it's ironic that the last 24 hours my wife and I have been stressing out about how we were planning to be on a flight back home for Christmas, but our flight was cancelled due to a big winter storm sweeping Colorado.
It's a great example of how we can do our best to plan, only to have things outside our control force us to adapt.
When I started on this business journey, it felt like every book and blog said to create a business plan.
I dove in and read everything about creating business plans. I spent weeks writing everything I was going to do for my business. I had goals and milestones laid out for the next 5 years. It was my master plan.
I set it aside and reread it a few days later. Reading it after the initial rush faded didn't leave me with the same motivation I had writing it.
It didn’t motivate me. It only filled me with dread. I finished reading it and thought:
“This isn’t going to help me at all.”
The purpose of a business plan comes down to two things: communicating your vision and reducing risk.
By setting a vision, we can get multiple people working towards the same goal. A business plan is an effective tool for getting investors, stakeholders, and employees to understand where you're going and what you hope to achieve.
The downside is that we need to reduce our options. We need to stick to a plan in order for people to trust their leader. The larger the group, the less you can change direction without looking like a leader who doesn't know what they're doing.
Where a plan is a necessity for a company, it can be a disadvantage for a solo founder.
Why? Because one of the few unfair advantages as a solo entrepreneur is my ability to move fast and adapt. Where changing direction even at a moderately sized company can feel like a cruise ship making a U turn, I can stay fast and nimble.
A business plan is also used to reduce risk. But does it really?
Business is inherently risky. Few businesses succeed, even fewer stick around for more than 5 years. So reducing risk is a worthwhile investment.
And that’s where I had the thought:
“What if this isn’t the most effective way to reduce risk?”
At its core, a business plan is an attempt to predict the future in an unpredictable environment.
Many businesses had big yearly planning sessions for 2020. None of us could have predicted how that went.
So what’s the alternative?
I discovered the Small Bets community created by Daniel Vassallo. It’s a community of entrepreneurs taking an alternative approach to business.
The Small Bets approach breaks down like this: rather than attempting to predict the future and plan away the risk, embrace risk and adapt your effort for a risky environment.
Annie Duke is a world champion poker player who wrote Thinking in Bets as a guide for people to take the lessons learned playing poker and apply them to business decisions. She writes:
Over time, those world-class poker players taught me to understand what a bet really is: a decision about an uncertain future. The implications of treating decisions as bets made it possible for me to find learning opportunities in uncertain environments. Treating decisions as bets, I discovered, helped me avoid common decision traps, learn from results in a more rational way, and keep emotions out of the process as much as possible.
A good poker player doesn't sit down at a table and bet all the cash they brought on a single hand. Yet this is the strategy of many entrepreneurs when they go all in on one product for years at a time. Some succeed and we love telling those stories. But we don't talk about the thousands who fail. Even those who have a successful product have a long history of failures.
A professional poker player doesn't go all in on one bet right away. Instead, the pro make a lot of small bets. They play each hand based on their skill and the odds of their hand. They know each bet has a degree of skill and part that's pure luck. The best strategy is to spread the risk over a lot of small bets.
So rather than making one big bet, I’ll take the approach of making a lot of small bets.
What is small? Something I can create and sell in under 4 weeks.
I won’t plan beyond that because my advantage of working solo is that I can change directions and leave myself open to jump at opportunities that look interesting.
I think I know what my first product will be, but I’m not sure. I’ll make the decision when I’m ready to execute.
For now, I’ll spend time with family for the holidays and use the time to recharge.
🧠 Psychology Patterns
A concept from psychology to improve your product.
Recognition over Recall
It's easier to recognize things we've seen before than it is to recall them from memory.
How can we surface options and allow users to choose from them rather than making them recall things from memory?
Designing a navigation menu with pictures when users aren't familiar with the nomenclature.
Offer multiple choice options rather than empty text fields.
🖤 Cool Things
📚 Book — Thinking in Bets
This book had a big impact on how I think about risk and making decisions. There's something so freeing about the idea that every business decision can be thought of as a bet. You're betting this product will work, you're betting this feature is a good use of your team's time... A great mental model to apply to decision making.
🛠️ Tool — Coherence X
A great Mac utility that allows you to make a macOS app out of any website. It's Chrome based so you can include any Chrome plugins you already have installed (like adblockers). I've used it for creating apps for Netflix, TweetDeck, and others.
🎥 Video — Everything is a Remix
A classic that I recently rewatched. It should be required watching for everyone in a creative field.
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