The Four Kinds of Luck

Ameet Ranadive
Nov 12, 2016 · 7 min read

I happened to re-read an excellent blog post from Marc Andreessen, way back from 2007: “Luck and the Entrepreneur, Part 1: The four kinds of luck

According to Marc, there are four kinds of luck (or chance) that matter to entrepreneurs — or anyone, for that matter.

  • Chance I: Blind luck
  • Chance II: Motion
  • Chance III: Recognizing good fortune
  • Chance IV: Directed motion

Here are more details about each kind of luck, and how it can affect your chances of professional success.

Chance I: Blind luck

As Marc writes in his post (and he is also quoting from a book called Chase, Chance, and Creativity in much of his post):

“In Chance I, the good luck that occurs is completely accidental. It is pure blind luck that comes with no effort on our part.”

I liken this kind of luck to winning the lottery. Right place, right time. But you didn’t do anything special to influence the luck factor. Thank your stars for this kind of luck and run with it.

Chance II: Motion

From Marc’s post:

“In Chance II, something else has been added — motion.”

“A certain [basic] level of action ‘stirs up the pot’, brings in random ideas that will collide and stick together in fresh combinations, lets chance operate.”

“[Chance II] involves the kind of luck [Charles] Kettering… had in mind when he said, ‘Keep on going and chances are you will stumble on something, perhaps when you are least expecting it. I have never heard of anyone stumbling on something sitting down.’”

Chance II luck comes from activity. Just by the sheer act of doing something, you are more likely to stumble into luck. As an entrepreneur, if you happen to pick a good market, just being active in that market means that you are likely to stumble onto something. But opportunities don’t necessarily come to you — you at least need some motion in order to uncover the opportunities.

The advice for us is therefore to do something. Try things. Stop analyzing, thinking, pondering—just do it. Have a bias to action. Given the element of Chance II, you’re certainly better off taking many swings at the bat rather than sitting in the dugout. You’re even better off taking more swings at the bat than waiting for the perfect pitch to increase your chances of a hit. In fact, Marc writes about the idea of maximizing your at-bats in another post from the same period, “Age and the entrepreneur, part 1: some Data.”

“The odds of a hit versus a miss do not increase over time. The periods of one’s career with the most hits will also have the most misses. So maximizing quantity — taking more swings at the bat — is much higher payoff than trying to improve one’s batting average.”

Chance III: Recognizing good fortune

From Marc’s post:

“Now, as we move on to Chance III, we see blind luck, but it tiptoes in softly, dressed in camouflage.

“Chance presents only a faint clue, the potential opportunity exists, but it will be overlooked except by that one person uniquely equipped to observe it, visualize it conceptually, and fully grasp its significance.

“Chance III involves involves a special receptivity, discernment, and intuitive grasp of significance unique to one particular recipient.

“Louis Pasteur characterized it for all time when he said, ‘Chance favors the prepared mind.’”

With Chance III, an opportunity presents itself, but you are the only one to see it because of your unique perspective. That perspective was formed by the sum total of all of your unique knowledge, experiences, skills. Others may also have seen the same opportunity, but failed to recognize it because they could not comprehend its significance. Chance III is the flash of brilliant insight that occurs — the “a ha” moment that you get because you were able to put things together in a unique way in order to recognize the good fortune.

A quick story that represents Chance III — Sir Alexander Fleming discovered penicillin due to an insight based on a combination of factors and his own unique experience.

“He was at his work bench in the laboratory, made an observation, and his mental sequences then went something like this: (a) I see that a mold has fallen by accident into my culture dish; (2) the staphylococcal colonies residing near it failed to grow; (3) therefore, the mold must have secreted something that killed the bacteria; (4) this reminds me of a similar experience I had once before; (5) maybe this new ‘something’ from the mold could be used to kill staphylococci that cause human infections.”

“Actually, Fleming’s mind was exceptionally well prepared. Some nine years earlier, while suffering from a cold [you can’t make this stuff up], his own nasal drippings had found their way onto a culture dish. He noted that the bacteria around his mucous were killed, and astutely followed up the lead. His experiments then led him to discover… lysozyme… [which] proved inappropriate for medical use, but think of how receptive Fleming’s mind was to the penicillin mold when it later happened on the scene!”

Chance III is what leads an entrepreneur to come up with a business insight that gives her startup an unfair advantage. According to Aaron Levie, CEO of Box, “To get ahead of the competition, startups need to focus on finding and creating unfair advantages — areas of their business that the competition simply can’t emulate. These advantages can manifest in the product, business model, and even how the business operates.” If you have a prepared mind, when you see the right opportunity to create an unfair advantage, you will recognize that opportunity because of your unique perspective. That’s the best kind of unfair advantage because others — the incumbents — may not see it until it’s too late.

Due to your unique perspective, you recognize a Chance III opportunity and can disrupt a market. As Mike Maples, Jr. of Floodgate wrote:

“If you aspire to do something truly legendary, in business or any other field, you will discover that the biggest breakthroughs come from obsessively pursuing insights that defy conventional wisdom.

“In the startup world, this translates to having what PayPal founder and Facebook investor Peter Thiel calls a ‘secret’ or what Benchmark co-founder Andy Rachleff would describe as an idea that is ‘non-consensus and right.’”

Finding secrets or coming up with an idea that is non-consensus and right very often involves Chance III.

Chance IV: Directed motion

The final form of luck that Marc writes about enables you to discover good fortune specifically because of your directed motion.

Unlike Chance II, which is luck due to random motion, Chance IV is directed motion. You have a hunch, so you pursue it, and luck appears.

Both Chance III and Chance IV enable you to encounter luck due to something unique about you. The difference is that Chance III enables you to recognize good fortune that shows up in front of you; Chance IV enables you to encounter good fortune specifically because of the direction you have chosen to move. You are going in that direction because of something that is unique to you — your knowledge, your experiences, your perspective.

From Marc’s post:

“[Chance IV] favors the individualized action.

“This is the fourth element in good luck — an active, but unintentional, subtle individualized prompting of it.

“Chance IV is the kind of luck that develops during a probing action which has a distinctive personal flavor.

“The English Prime Minister, Benjamin Disraeli, summed up the principle underlying Chance IV when he noted: ‘We make our fortunes and we call them fate.’

Chance IV comes to you, unsought, because of who you are and how you behave.”

So what does all this mean for you? How can you take advantage of the different types of luck?

First, have a bias to action. Just by being in motion, you increase your likelihood of encountering Chance II (motion). Remember Kettering’s quote: “I have never heard of anyone stumbling on something sitting down.” And do what you can to maximize your swings at bat. Just taking the swings could be enough motion to encounter Chance II.

Second, be curious. Seek out the why. Be willing to try new things. Look at every challenge as an opportunity to learn. Have a growth mindset. If you’re focused on learning and improving yourself, you will be motivated to seek and thrive on challenges and new opportunities. And therefore you are more likely to do things, take risks, and maximize your swings at bat.

Third, strengthen your critical thinking and synthesis skills. The more you develop your own unique perspective through critical thinking, and the more you synthesize past learnings and experiences, the better prepared your mind will be when you encounter a Chance III opportunity. You can strengthen your critical thinking and synthesis skills by doing a lot of reading, as well as reflecting and writing. When you read, do it with an active mind — interpret what you’re reading, question it, draw out the implications. As you reflect on what you read or experience, write down important lessons, insights, or thoughts so that you can remember them later. Synthesize what you read and observe now, with what you have thought, experienced, or learned in the past.

Finally, strive to have deep, well-rounded interests. The depth will give you more insights, knowledge, and pattern-matching skills that are unique to you. Being well-rounded gives you an opportunity to synthesize the unique combination of interests, experiences, and lessons into your own perspective. All of this will help you to take advantage of Chance III and Chance IV opportunities.

As the saying goes, “You can make your own luck.” By recognizing the four kinds of luck, you can take active steps to improve your chances. Then you too can claim, as Disraeli had done, “We make our fortunes and we call them fate.”

Ameet Ranadive

Written by

Entrepreneur. Product management @ Instagram.

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