4 Things “Gold Rush” Taught Me About Startups

I’ve always liked the show Gold Rush, but have never really understood why. I’m an MBA and startup product guy living in Chicago, probably not their core audience, but have seen every episode Discovery has ever made.

So I was watching last night’s episode on my DVR today, and it hit me — I like Gold Rush because it’s exactly like what I spend the rest of my time thinking about — startups. Don’t believe me? Maybe I can convince you.

First of all, if you’ve never seen the show, you should. Second, if you have seen it, no spoilers about last night’s episode, because I just paused it and won’t be able to finish it until I get this seemingly profound (to me at least) bit of logic out of my head and on to paper.

But if you’ve never seen it, it’s a show about a bunch of gold miners in Alaska who go all out every summer in a massive race to dig as much dirt out of the ground as possible before it freezes back over. They run it through what’s called a washplant to separate the gold from the dirt, weigh it, put it into mason jars with about 100 ounces in each (>$100k), and find out if they’ve finally struck it rich.

So now that you’re up to speed, here’s what I think this Discovery Channel show can teach us about running a startup:

1. Startups are just a series of hypotheses

Every season, the miners are working on a new piece of land that they hypothesize will hold massive amounts of gold for one reason or another — e.g. this week, Todd Hoffman’s crew is digging in a channel of waist-deep mud, because they found a fossilized mammoth tusk in it, and, of course, legend has it, “where you find mammoth tusks, you find big gold.” Who knew?

Similarly, when we choose to start a business, it’s because we have some reason — maybe only visible to us, and when we tell someone else it may sound just as crazy as the mammoth lore above — to believe that there is value to be created and that we’re the people to do it.

2. It’s our job to turn those uncertain hypotheses into known risks so that we can make better business decisions

Now that the miners think they know where they’ll find gold, what do they do next, spend the whole season digging to find out? Of course not, that would be crazy right? But startups do it all. the. time. Why is that? Because the longer we can delay letting our idea reach the harsh world, the longer we can keep the dream alive in our head that we’ll be the next unicorn without having to confront the reality that is extremely unlikely to live up to that dream.

Instead, these mining crews run small tests with batches of just enough pay-dirt to find out if their hypothesis is right or if they should move to another area. We should be doing the same thing — getting to market as fast as possible with an MVP that is just enough to see if there’s anything to our vision or if we’re just chasing dreams of mammoth tusks. The only thing that can give us that answer is the collision between our idea and the real world that exists outside our own four walls.

3. Be agile and keep the plant running

One-week sprints. They don’t call it that, but the miners organize around one-week blocks of work that they will focus on completely. During that week, they have a singular goal, which is to keep the washplant running to process more pay-dirt. They only bring their heads up at the end of the week to see what the data (see #4) says about their work and make decisions that will impact the next week.

Startups need to operate in much the same way. When in a sprint, we need to put our heads down, work hard, and do whatever is necessary to keep the plant running. But at the end of those sprints, we need to take a breather, look at the data, and be honest with ourselves about what to do next — even if that means a pivot away from where we thought we’d be going.

4. Measure what matters most

At the end of each week of 12+ hour days of back-breaking labor, the miners do what’s called a cleanup. This is where they break down their washplant and dig every last bit of gold-rich concentrated mud from every nook, cranny, and weird piece of gold-catching astroturf so they can process it and find out the answer to the one simple question they’ve put all this work into solving — How much gold did we get?

You see, the miners manage their entire operation based on one metric that matters — gold. And although you hear about it less than the overall gold count (which, like all vanity metrics, is more flashy because it’s a bigger number to report. I mean, come on, this is still primetime TV we’re talking about here), if you pay close attention to the show, you hear decisions being made off of a different metric — ounces of gold per yard of dirt processed.

This one metric is great, because its impacts can be felt across the entirety of the business they run and give them a true, honest, no bullsh*t, picture of whether they’re digging in the right place.

As startups, we need to know what that one metric (or small set of metics) is that can give us the same type of insight into our business, so we can focus on our own long days and hard work knowing we’ll get honest feedback on whether what we’re doing is working… or not.

Looking back now, it makes more sense why I’ve been so enthralled with this show for so long. Time to go back now and see if these guys are right about the mammoth tusks.

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