Thread by @tomaspueyo

S curves are everywhere. Learning to identify them is a superpower

They're how epidemics evolve
How memes spread
How investment unfold
How businesses grow
How muscles contract
How technology us adopted
How animation flows
How popcorn explodes
How ice melts
How water evaporates

How countries are formed
How magnets snap
How atoms spin
How transistors change their charge
How ppl get promoted
How they succeed
How they're fired
How they're born
How they die

We don't always recognize them because, depending on where we are on an S curve, it might not look like one.

It might look line a horizontal line
Or a vertical one
Or an oblique one
Or an exponential
Or a noisy surve

Take for example Amazon's S curve

https://twitter.com/tomaspueyo/status/1408088332345569280?s=20

Or Facebook's S curve

https://twitter.com/tomaspueyo/status/1408099887896416266?s=20

You want to identify S curves early on, so you can benefit from the wave.

You find S curves when something is consistently getting better every day.

Linear growth, like vaccine distribution, are good.
Exponential growth, like a pandemic, will grow much faster. Identify those.

But beware. Everything that grows will eventually stop. You need to estimate where the invisible asymptote is to predict when the growth will slow down. Most ppl will not realize this is happening. You will front them all and take advantage of it.

So how can you use S curves?
Seeing S curves will help you predict things better in business and life:
1. If you're considering joining a hypergrowth company, learn how they’re growing. Ads? Hard to compound. The + you spend, the worse the clients and + expensive. Virals? Amazing

2. If you have organic growth, be persistent and, if you can, go big. 10% growth week over week is 140x over one year. Don’t worry if the absolute amounts are still small. Eg “It’s just growing at $10k per month”… “Yeah, but that’s 100% month over month completely organically!”

3. Beware of these organic growths. One day you might think your competitors are small and weak, and the next they beat you (ask MySpace). Or you might think a new pandemic is no big deal and…

4. Every exponential growth will eventually saturate. To predict the slowdown, understand where the invisible asymptote is. To do that, understand who is the target of that growth, and assess how many people like that there are (TAM)

5. If the invisible asymptote is far away and you have few resources, keep focusing on improving your current business. If you have substantial resources or the invisible asymptote is getting closer, start investing in new S curves.

6. S curves can stack. Find a new path for growth to add a new S curve.

7. When you’re thinking about where to invest, pay attention to early S curves. Eg, aggregators are types of companies that have network effects. If they reach critical mass, they grow exponentially. Google, Facebook, Shopify, Uber, Youtube, Airbnb… All aggregators.

More details in my article
unchartedterritories.tomaspueyo.com/p/s-curves

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