In a power-law world, a small number of outcomes drive most results.
Upside is the visible part.
Survivability is the hidden one.
Upside is the visible part.
Survivability is the hidden one.
Power laws don’t reward the smartest ideas.
They reward the ideas and the people
who can stay alive long enough
for the distribution to reveal itself.
That’s a very different skill.
They reward the ideas and the people
who can stay alive long enough
for the distribution to reveal itself.
That’s a very different skill.
Being early and right often looks identical
to being wrong.
Same drawdowns.
Same ridicule.
Same uncertainty.
Only time separates the two.
to being wrong.
Same drawdowns.
Same ridicule.
Same uncertainty.
Only time separates the two.
Take Masayoshi Son and Alibaba.
The insight wasn’t the hard part.
The hard part was surviving years of doubt and volatility
long enough for the bet to matter.
The insight wasn’t the hard part.
The hard part was surviving years of doubt and volatility
long enough for the bet to matter.
Or look at NVIDIA.
For years it was “just a gaming GPU company.”
The thesis was early.
The patience was expensive.
Power laws never feel obvious while you’re inside them.
For years it was “just a gaming GPU company.”
The thesis was early.
The patience was expensive.
Power laws never feel obvious while you’re inside them.
Or Carvana.
The idea didn’t change much.
The structure almost broke.
What mattered wasn’t optimism.
It was whether the container could survive long enough.
The idea didn’t change much.
The structure almost broke.
What mattered wasn’t optimism.
It was whether the container could survive long enough.
This is why so many “correct” theses fail.
Not because the idea was wrong.
But because the structure holding it
couldn’t tolerate variance.
The math didn’t fail.
The container did.
Not because the idea was wrong.
But because the structure holding it
couldn’t tolerate variance.
The math didn’t fail.
The container did.
People chase power laws by focusing on upside.
They ignore the harder part:
•drawdown tolerance
•pacing
•optionality
•the ability to do nothing under pressure
That’s where outcomes usually collapse.
They ignore the harder part:
•drawdown tolerance
•pacing
•optionality
•the ability to do nothing under pressure
That’s where outcomes usually collapse.
Power laws punish fragility more than error.
A fragile structure with a great idea still dies.
A durable structure with a decent idea can compound.
The power law never apologizes.
A fragile structure with a great idea still dies.
A durable structure with a decent idea can compound.
The power law never apologizes.
Power laws aren’t about predicting the big winner.
They’re about not getting eliminated
before the big winner can matter.
Survival comes first.
Asymmetry comes second.
They’re about not getting eliminated
before the big winner can matter.
Survival comes first.
Asymmetry comes second.
If you want to understand power laws, ask this:
“What breaks first when I’m wrong for longer than expected?”
That answer matters more
than any upside projection ever will.
“What breaks first when I’m wrong for longer than expected?”
That answer matters more
than any upside projection ever will.
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