What can a Startup learn from “David and Goliath”

David and Goliath by Malcolm Gladwell has one call to action: Getting you to think counterintuitively!

Mike Townsend
Nov 13, 2014 · 4 min read

It’s a delicate skill to not assume common truths. Assume everything and you get played, assume nothing and go nowhere.

Malcolm Gladwell narrates the audio version of this book, David and Goliath, with a certain level of excitement that makes it hard not to talk about.

Without summarizing the stories, I’ll cut straight to a few key examples from the book that get you to think just a bit differently:

  • Decreasing classroom size stops being beneficial around 15 children.
  • The best universities may not always give you the best opportunities.
  • Dyslexia and death can make you more likely to succeed.

1. Understand the inverse U-curve
Things are not always as they seem, more is not necessarily better

Look at these graphs and tell me which most accurately describes what would happen to you as you became increasingly rich.

If this is you, you’re a robot and you wouldn’t be reading this post.

This is where most people believe they are….

You can disagree with it, but this has been shown to be true on average.

Most startups want as many customers as possible, but at a certain point there is a trade off. Core product development slows, CEO attention is on fire, fighting instead of recruiting, long term planning, etc. It’s important to understand that there are bounds to most systems in the world.

This same inverse U-curve applies to:

  • number of hours worked in the day
  • number of customers you have
  • number of investors your know
  • years of experience you have
  • ….everything

2. Big pond or small pond, what is better for you?
A small pond may give you better odds at success

When you start a company you need to make this important decision: “Do I swim in a big pond or a small pond?”. The big pond for tech is SF, the medium ponds are Los Angeles and New York. The small ponds are 4–10: Austin, Chicago, and Seattle.

Like anything, there is a tradeoff (diminished returns) at a certain point, and that point depends on your business.

The key here is to choose a metric that you’d be happy with.

Gladwell argues that it may not always be your best choice to go to a top school, even if you get in. The worst engineering students at Harvard, he claims, may be as smart as the top third at a lower ranked college. But Harvard students compare themselves to their Harvard peers, and that’s bound to make those in the bottom third feel stupid and unsuccessful. Better to have gone to a non-elite institution, he says — to have been a big fish in a little pond — than have had your dreams and confidence crushed.

If your startup is building and selling technology as it’s core competency, than SF is your answer. However, if you’re building a marketplace for trainers, teachers, tutors, or musicians you may be better in another city.

3. Your disadvantage may be your advantage
Don’t focus on disadvantages, just solve the problem and by doing so you’ll have a uniquely valuable experience.

Vivek Ranadivé had never seen basketball, he was from Mumbai, India, when he decided to coach a youth girls team who were in desperate need of a coach. His girls were so bad that he decided he would press full court all game, every game. It was a huge success, his team won in regular season and got to the playoff finals.

“It didn’t really matter that my girls couldn’€™t shoot as well,”€ Ranadivé said. “€œIf I could get the ball under the basket and if I could win the turnover battle, then I could win the game.”

His weakness forced him to try a new tactic that won!

Side note: Vivek Ranadivé is now a billionaire CEO and owner of the the Sacramento Warriors!

If you aren’t a typical founder, or you have some weakness, fight through it, try every possible angle you can think of and it may lead to a breakthrough.

If you don’t have a technical skill, find people who do or learn it.
If you don’t have connections to investors, hack your way in.
If you don’t have it, go get it.

[1] http://download.audible.com/prod...
[2] Relook at top cities for technology startups
[3] WATCH: Vivek Ranadivé interviewed for Malcolm Gladwell piece on 60 Minutes

    Mike Townsend

    Written by

    Healthcare entrepreneur: Founder @goharvey @HomeHero. @Zingplatform (acq. BigCommerce)

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