Arms Race vs. Creating Something New

You care about winning.

Example #1: When the goal is an arms race (i.e. who has the biggest boat), we underestimate the importance of funding.

This table from the US State Department shows the cost of the Civil War.




The Union had almost 3x as much funding as the Confederacy. Those resources mattered greatly in determining who won the war.

Example #2: When the goal is to innovate and create (i.e. solve the currently “unsolvable”), we overestimate the importance of funding.

When YouTube was being launched, over 40 startups were working on building an online video platform. This included Google. Google, with all the resources in the world lost. The then tiny YouTube crushed them. Why? Constraints.

When the goal is to create something new, having to face the reality of constraints, and then problem solving within those narrow boundaries, actually increases your chance of success.

When you are working to win, know what kind of battle you are in.











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