How to pick winners and losers
Last week I was deep in fossil fuel country, sitting in the back of the room at an energy conference at 8:00 a.m. As I desperately wished my third cup of coffee would clear the fogginess of jet lag and the mental exhaustion of leading a workshop the day before, I heard the first presenter say something better than the strongest espresso.
It was this: “Our investments in R&D have not reached their full potential because of the Valley of Death, and we need to have the political will to try to pick some winners.”
A tired refrain in the world of energy innovation is that “we shouldn’t pick winners and losers.” It began as an argument for why government should keep its focus on basic research and let the market determine the rest. Over the years, I always grimaced when I heard the phrase touted even by some of the strongest supporters of government-funded R&D.
The problem? The phrase itself inherently contradicts how innovation happens. I sometimes joke that if we already knew what solutions would work, we could “pick winners, not losers.” But the truth is, we don’t already know. We can’t.
We can hypothesize, make educated guesses, analyze data, and extrapolate about the future. These are valuable, and they can guide what technologies the government or the private sector chooses to support. But they won’t give us the answers we need without something else: experimentation.
A popular phrase used by Silicon Valley types is “fail fast, fail often.” Sometimes this idea is taken to the extreme and can lead to rash or impatient investments. But it’s also the most effective pathway to innovation.
When you’re trying something new, there will always be more losers than winners — ideas that don’t work, missteps, diversions, distractions, and choices that in retrospect were just plain wrong. But most of the time, we can’t know the difference between a loser and a winner until we test it out. Until we try. Until we pick.
To solve technical problems, to prove a new business model, to drive change through policy, you have to do something that might feel uncomfortable or risky. Say your idea out loud. Act, even if you’re not sure how. Start.
When you try and fail, you learn things, often critical things that inform the next step. And the step after that. And the step after that.
I have also seen there can be extra magic in experimentation if it’s done a certain way. If you experiment publicly, you can inspire and empower others to try new things too. If you do it collaboratively, you create a community around a common goal that can have exponentially more impact than you might alone.
The nature of innovating — whether in technology, business, policy, or life — requires accepting the risk of failure and the opportunity to learn. The alternative — staying paralyzed by the false dilemma of picking winners and losers — means being stuck in the Valley of Death forever.