Smartcuts: The Breakthrough Power of Lateral Thinking
Author: Snow, Shane
Notes by: Jacopo Perfetti.
Introduction: “How Do They Move So Fast?”
IT TOOK THE OIL tycoon John D. Rockefeller 46 years to make a billion dollars. He clawed his way to the top of the 19th-century business world. Starting with a single oil refinery in 1863, over two decades, he constructed oil pipelines and bought out rival refineries until he’d built an empire. Seventy years later, the 1980s computer baron Michael Dell achieved billionaire status in 14 years; Bill Gates in 12. In the 1990s, Jerry Yang and David Filo of Yahoo each earned ten figures in just four years. It took Pierre Omidyar, founder of eBay, three years to do it.
And in the late 2000s, Groupon’s Andrew Mason did it in two.
We work hard, but hardly question whether we’re working smart.
you can think of smartcuts as shortcuts with integrity. Working smarter and achieving more—without creating negative externalities.
Too many of us place our hopes and dreams in the unreliable hands of luck, but the world’s most rapidly successful people take luck into their own hands (even though many are too humble to say so).
serendipity can be engineered, that luck can be manufactured, convention can be defied, and that the best paths to success—no matter how you define it—are different today from what they were yesterday.
Part I: Shorten
You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose. —DR. SEUSS
1. Hacking the Ladder: “Bored Mormons” > 23/329
Nintendo began its life printing Japanese playing cards; the company brokered in taxis, instant rice, and hotels before it saw opportunity in the emerging
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WE LIVE IN AN age of nontraditional ladder climbing. Not just in politics, but in business and personal development and education and entertainment and innovation.
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Traditional paths are not just slow; they’re no longer viable if we want to compete and innovate.
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thinking more like hackers, acting more like entrepreneurs. We have to work smarter, not just harder.
2. Training with Masters: “The Vocal Thief” > 39/575
Analysis shows that entrepreneurs who have mentors end up raising seven times as much capital for their businesses, and experience 3.5 times faster growth than those without mentors. And in fact, of the companies surveyed, few managed to scale a profitable business model without a mentor’s aid.
2. Training with Masters: “The Vocal Thief” > 39/588
equal amounts of research support both assertions: that mentorship works and that it doesn’t. Mentoring programs break down in the workplace so often that scholarly research contradicts
2. Training with Masters: “The Vocal Thief” > 40/590
Harvard Business Review articles with titles such as “Why Mentoring Doesn’t Work.” The mentorship slip is illustrated well by family businesses: 70 percent of them fail when passed to the second generation. A
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Icarus, to whom his father and master craftsman Daedalus of Greek mythology gave wings; Icarus then flew too high too fast and died.
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There’s a big difference, in other words, between having a mentor guide our practice and having a mentor guide our journey.
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We got to pick and choose the ancestors who would inspire the world we were going to make for ourselves.”
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Sam Walton, founder of Walmart, studied and stole moves from master retailers fabulously well. He openly admitted it. “Most everything I’ve
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done, I’ve copied from someone else,” he said.
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As we’ve learned, mentorship doesn’t
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always yield success. But when we look at superlative success stories throughout history, the presence of an in-person mentor (in Jimmy’s case his manager) or a world-class, long-distance mentor (in Jimmy’s case, great comedians whom he copied) with whom the mentee has a deep, vulnerable relationship is almost always manifest.
3. Rapid Feedback: “The F Word” > 58/849
Chris’s. The former chief technical officer of, a delivery site that would take anything you ordered online and deliver it to your door in an hour, explained how his company went from six people in a basement to 300 people in a five-floor office with $ 280 million from investors. In the heyday of the early Web, the company spared no expense to advertise its services everywhere: billboards,
3. Rapid Feedback: “The F Word” > 58/852
TV commercials, and countless Internet ads. “We were losing money with every order,” Chris said. “But the ‘gray hairs’ in the room said we needed to cut corporate costs instead . . . there was no plan.” In a couple of years, the company had burned most of its investors’ cash and slowly laid everyone off.
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Oscar Wilde once said, “Experience is the name everyone gives to their mistakes.”
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In 2008 four Harvard researchers looked at historical data of people who started businesses in America between 1975 and 2003. Their goal was to see how well founders who’d previously failed in business did with subsequent businesses. Had they learned from their past failures? They compared the failures to founders who’d successfully taken a company public, and entrepreneurs who’d never started a business before. It turns out that after you adjust for statistical margin of error, an entrepreneur
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who’d failed in a previous venture was not likely to do better than someone who’d never run a business in her life.
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According to the study, successful entrepreneurs, on the other hand, are 50 percent more likely to succeed in a second venture. The more you win, the more likely you are to win again.
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So, failing in business doesn’t make us better or smarter. But succeeding makes us more likely to continue to succeed.
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They called the results a “paradox of failure.” It turns out that the surgeons who botched the new procedure tended to do worse in subsequent surgeries.
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than learning from their mistakes, their success rates continuously declined. On the other hand, when surgeons did well on the new surgery, more successes tended to follow. Just like the startups in the Compass and Harvard studies.
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“Even though an individual failure experience may contain valuable knowledge,” Staats says, “without subsequent
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effort to reflect upon that experience, the potential learning will remain untapped.
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We have no problem assuming responsibility for our successes, though, even if we don’t brag about them. Staats explains, “People tend to attribute their
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own success to their effort and ability. Since they have control over their own effort and actions, these attributions motivate them to exert effort in subsequent tasks so that they can continue improving and learning.” This made the successful doctors better and better. However, when failure isn’t personal, we often do the opposite. When someone else fails, we blame his or her lack of effort or ability. When we see people succeed, we tend to attribute it to situational forces beyond their control, namely luck.
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feedback interventions
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The difference was how much the feedback caused a person to focus on himself rather than the task.
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a high-pressure feedback barrage tends to make us self-conscious. We get stuck inside our own heads.
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the closer feedback moves our attention to ourselves, the worse it is for us.
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preferred negative feedback to positive. It spurred the most improvement. That was because criticism is generally more actionable than compliments. “You did well” is less helpful in
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improving your bowling game than “You turned your wrist too much.” Crucially, experts tended to be able to turn off the part of their egos that took legitimate feedback personally when it came to their craft, and they were confident enough to parse helpful feedback from incorrect feedback. Meanwhile novices psyched themselves out. They needed encouragement and feared failure.
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The tough part about negative feedback is in separating ourselves from the perceived failure and turning our experiences into objective experiments. But when we do that, feedback becomes
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much more powerful.
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transforms failure (something that implies finality) into simply feedback (something that can be used to improve).
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gives them rapid feedback; (2) it depersonalizes the feedback; and (3) it lowers the stakes and pressure, so students take risks that force them to improve.
Part II: Leverage
4. Platforms: “The Laziest Programmer” > 86/1212
A traditional software company might have built Twitter on a lower layer like C and taken months or years to polish it before even knowing if people would use it. Twitter—and many other successful companies—used the Rails platform to launch and validate a business idea in days. Rails translated what Twitter’s programmers wanted to tell all those computer transistors to do—with relatively little effort. And that allowed them to build a company fast.
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ISAAC NEWTON ATTRIBUTED HIS success as a scientist to “standing on the shoulders of giants”—building off of the work of great thinkers before him.
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Platforms are tools and environments that let us do just that. It’s clear how using platforms applies in computer programming, but what if we wanted to apply platform thinking to something outside of tech startups?
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In other words, in a generation, Finnish education went from unremarkable to the envy of the planet.
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This is the point that Dyson was making earlier. Hands-on learning and the use of tools, he says, helps us to want to learn, to get rapid feedback, and to actually grasp math better than memorizing facts from the bottom up.
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In an age of platforms, creative problem solving is more valuable than computational skill.
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Albert Einstein is famously quoted: “The definition of insanity is doing the same thing over and over and expecting different results.”
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He didn’t actually say it.*
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Finland’s public school
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hired only teachers with incredible qualifications and it had them mentor students closely.
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focuses on teaching students how to think, not what to think. That, says Wagner, is core to making school both interesting and valuable. As the saying, attributed to Dr. Seuss, goes: “It is better to know how to learn than to know.”*
4. Platforms: “The Laziest Programmer” > 95/1345
They’re taught to be entrepreneurs of their own lives.
5. Waves: “Moore and Moore” > 106/1492
Luck is often talked about as “being in the right place at the right time.” But like a surfer, some people—and companies—are adept at placing themselves at the right place at the right time. They seek out opportunity rather than wait for it. This chapter is about hacking that process.
5. Waves: “Moore and Moore” > 106/1495
A wave is made up of alternating crests and troughs that from the side look like a squiggly line. When two waves collide, one of two things can happen: they can cancel each
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other out or, if timed just right, they can combine and increase in intensity.
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This is called destructive and constructive interference. The former means the waves collide and go flat. The latter forms a megawave.
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what we take for granted often
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gets in the way of our own success. Deliberate pattern spotting can compensate for experience. But we often don’t even give it a shot. This explains how so many inexperienced companies and entrepreneurs beat the norm and build businesses that disrupt established players. Through deliberate analysis, the little guy can spot waves better than the big company that relies on experience and instinct once it’s at the top. And a wave can take an amateur farther faster than an expert can swim.
5. Waves: “Moore and Moore” > 111/1558
“20% Time” is not Google indigenous. It was borrowed from a company formerly known as Minnesota Mining and Manufacturing, aka 3M, which allowed its employees to spend 15 percent of their work hours experimenting with new ideas, no questions asked. 3M’s “15% Time” brought us, among other things, Post-it Notes.
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It’s helped companies like Google, 3M, Flickr, Condé Nast, and NPR remain innovative even as peer companies plateaued.
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In contrast, companies that are too focused on defending their current business practice and too fearful to experiment often get overtaken.
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For example, lack of experimentation in digital media has cost photo brand Kodak nearly $ 30 billion in market capitalization since the digital photography wave overwhelmed it in the late ’90s.
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First movers take on the burden of educating customers, setting up infrastructure, getting regulatory approvals, and making mistakes—getting feedback and adjusting.
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Fast followers, on the other hand, benefit from free-rider effects. The pioneers clear the way in terms of market education and infrastructure and learn the hard lessons, so the next guys can steal what works, learn objectively from the first movers’ failures, and spend more
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effort elsewhere. The first wave clears the way for a more powerful ride. Many of the biggest corporate successes in history—including Lerer’s Huffington Post, which became the number one political website in the world, the first for-profit online-only newspaper to win a Pulitzer Prize for reporting, and which sold for more than $ 300 million to AOL—have been fast followers in their respective spaces.
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General Motors surpassed the first mover in automobiles,
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Ford Motor Company, in market share in the early 1900s. Google, Facebook, and Microsoft were each fast followers in their respective spaces in the technology sector, leaping past Overture, Myspace, and Apple, respectively (until Apple made a comeback).
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“I think that being able to pick and read good waves is almost more important than surfing well,” Moore tells me.
6. Superconnectors: “Space, Wars, and Storytellers” > 127/1784
Imagine you’re at a party and you don’t know any of the other guests. You
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look around at the dozens of people and, if you’re extroverted, you’ll probably strike up a conversation with someone nearby. If you’re a little more timid in unfamiliar territory like I am, you might wander around in hopes that someone strikes up a conversation with you. Now imagine that a friend of yours shows up. She happens to know everybody at the party and she decides to take you around and meet everyone whom you should know. You soon meet a dozen people, with very little effort. Your friend is a superconnector.*
6. Superconnectors: “Space, Wars, and Storytellers” > 130/1830
THE CLASSIC MYTH OF Guevara and the Cuban revolution is that it was the pirate radio itself that helped the rebels win. But that’s not the whole story. Radios don’t come with built-in fan bases.
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Tapping networks is not as easy as simply shouting a message. Guevara became a successful superconnector not because he broadcast, but because he managed to build a relationship with the people.
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Abrams struggled to get his first break. He wrote nine screenplays that went nowhere.
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This is the classic Hollywood networking story: make friends with people who have connections and work them to your advantage. Be nice to them when you need them, then move on.
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after he became wildly successful; it turns out that even once he was on top, he continued to cowrite, codirect, and cocreate almost all his projects.
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J. J. Abrams is “a giver,” a rarity in an industry full of takers.
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once he was the superconnector, he still helped people.
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“If you do it only to succeed,” Grant says, in the long run, “it probably won’t work.”
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Mint built relationships with an enormous number of people—by helping them. Over the next two years, 1.5 million people who discovered Mint through its blog posts ended up actually signing up for Mint’s service. In 2009 Patzer sold the business to Intuit for $ 170 million.
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No matter the medium or method, giving is the timeless smartcut for harnessing superconnectors and creating
6. Superconnectors: “Space, Wars, and Storytellers” > 138/1944
Part III: Soar
7. Momentum: “Depressed Billionaires” > 141/1952
In January 2010 Paul “Bear” Vasquez, a burly, cheerful man who lived just outside of Yosemite National Park in central
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California, posted a home video to the website YouTube. A handful of people saw it. Six months later, late-night television host Jimmy Kimmel discovered the clip and shared it on Twitter, calling it “the funniest video in the world.” A fad ignited. Kimmel’s fans watched and shared, and the dormant video instantly shot to 1 million views. Within two weeks, it hit 5 million. Kimmel invited Vasquez to appear on his show, further boosting the video’s exposure. Suddenly the video was being spoofed on Cartoon Network and College Humor, parodied by Jimmy Fallon and indie musician
7. Momentum: “Depressed Billionaires” > 141/1959
Vasquez is the man behind the “Double Rainbow” video, which at last check had 38 million views. In the clip, Vasquez pans his camera back and forth to show twin rainbows he’d discovered outside his house, first whispering in awe, then escalating in volume and emotion as he’s swept away in the moment. He hoots with delight, monologues about the rainbows’ beauty, sobs, and eventually waxes existential.
7. Momentum: “Depressed Billionaires” > 142/1971
Bear Vasquez has posted more than 1,300 videos now, inspired by the runaway success of “Double Rainbow.” But most of them have been completely ignored.
7. Momentum: “Depressed Billionaires” > 143/1981
Bear Vasquez is still cheerful. But he’s not been able to capitalize on his one-time success. Michelle Phan could be the
7. Momentum: “Depressed Billionaires” > 143/1982
next Estée Lauder.
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They have so much money that they have nothing to prove to anyone. And many of them are totally depressed.
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The problem with some rapid success, it turns out, is that lucky breaks like Bear Vasquez’s YouTube success or an entrepreneur cashing out on an Internet wave
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are like having someone lift you up so you can grab one of the Olympic rings. Even if you get dropped off somewhere far along the chain, you’re stuck in one spot. Financial planners say that this is why a surprisingly high percentage of the rapidly wealthy get depressed. As therapist Manfred Kets de Vries once put it in an interview with The Telegraph, “When money is available in near-limitless quantities, the victim sinks into a kind of inertia.”
7. Momentum: “Depressed Billionaires” > 145/2009
studies show that the wealthy—especially those who fall into
7. Momentum: “Depressed Billionaires” > 145/2009
it through inheritance or the lottery or sale of a business—are often not happier once they’re rich. A meaningful percentage of them believe that their wealth causes more problems than it solves.
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only one-third of Americans are happy at their jobs. When there’s no forward momentum in our careers, we get depressed, too.
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The answer, it turned out, is simply progress. A sense of forward motion. Regardless how small.
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Amabile found that minor victories at work were nearly as psychologically powerful as major breakthroughs. To motivate stuck employees, as Amabile and her colleague Steven J. Kramer suggest in their book,
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businesses need to help their workers experience lots of tiny wins.
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They don’t have to do something Bigger or Better to be happy. They just have to keep moving.
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Sal Khan (who published 1,000 math lessons online before being discovered by Bill Gates, who thrust him into the spotlight and propelled him to build a groundbreaking digital school called Khan Academy),
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Rodriguez (a folk singer whose amazing, but largely unrecognized music work from the 1970s was featured in a 2012 documentary, which then catapulted him to world fame)
8. Simplicity: “Hot Babes and Paradise” > 160/2233
SOMETIMES BIGGER IS NOT better. Sometimes more of a good thing is too much. Sometimes the smartest next step is a step back.
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In the case of neonatal incubators, incrementally bigger and more powerful improvements meant, at the very most, incrementally less expensive (though it was usually the opposite). The hacker’s approach to NICU design was to think smaller. In doing so, Chen’s team created something world class.
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simplification often makes the difference between good and amazing.
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Harvard management professor Clayton M. Christensen furthered this concept in the mid-’ 90s when he coined the term “disruptive innovation.” Disruptive innovation is when the introduction of a lower-cost product steals market share from existing players, like when e-mail usurped postal mail
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The key feature of disruptively innovative
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products is cost savings (either time or money). But the key ingredient behind the scenes of every disruptive product is simplification.
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less expensive
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simpler to use.
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The machines themselves were complicated, but Henry Ford kept the complexity under the Model T’s hood.
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There are a lot of great inventors and improvers in the world. But those who
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hack world-class success tend to be the ones who can focus relentlessly on a tiny number of things. In other words, to soar, we need to simplify.
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OFTEN, THE THING HOLDING us back from success is our inability to say no.
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What he’s talking about has been proven in experiments led by Dr. Kathleen Vohs of the University of Minnesota, experiments that show that making lots of tiny choices depletes one’s subsequent self-control.
8. Simplicity: “Hot Babes and Paradise” > 164/2295
While other companies touted “4 Gigabytes and a 0.5 Gigahertz processor!” Apple simply said, “1,000 songs in your pocket.”
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Creativity comes easier within constraints.
9. 10x Thinking: “The Rocketeer” > 170/2359
ELON MUSK GREW UP in Pretoria, South Africa, in a family of five whose patriarch left when the kids were young. The young Elon preferred books to sports, and he was always making things. Around age ten, he ran out of books, so he read the encyclopedia, “out of desperation,” he says. At age twelve, he programmed a space-battle video game and sold it. At sixteen, he tried to open a video arcade, but he couldn’t get government permission to use the location he’d picked. He kept reading books. By age 31 he was living in California
9. 10x Thinking: “The Rocketeer” > 171/2363
and had sold two successful companies. The second, the online payments company PayPal, made him $ 165 million.
9. 10x Thinking: “The Rocketeer” > 172/2376
WHEN SPACEX LAUNCHED IN 2002, NASA employed about 18,000 people and many more contractors. About 400,000 people had contributed to the Apollo program, according to author Catherine Thimmesh, who years later tallied up all the spacesuit seamstresses and propulsion
9. 10x Thinking: “The Rocketeer” > 172/2378
engineers and software experts involved. Musk’s vision was to do with a tiny team what NASA wouldn’t with its tens of thousands: “To make life multiplanetary,” he said, as often as he had occasion to talk about it. To ensure the continuation of “human consciousness.”
9. 10x Thinking: “The Rocketeer” > 177/2456
It’s called “10x Thinking.” 10x
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Thinking is the art of the extremely big swing.
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Such a goal requires you to think radically different.
9. 10x Thinking: “The Rocketeer” > 177/2459
The apostle of 10x Thinking is a man with perhaps the coolest name ever: Astro Teller. Teller is the goatee-and-ponytailed head of a rather secret Google laboratory in California called Google[ x]. He holds a PhD in artificial intelligence. Teller’s job is to dream big. 10x big.
9. 10x Thinking: “The Rocketeer” > 179/2480
Most “innovation” inside industries and companies today focuses on making faster horses, not automobiles.
9. 10x Thinking: “The Rocketeer” > 179/2487
Academic research actually shows that we’re less likely to perform at our peak potential when we’re reaching for low-hanging fruit. That’s in part because there’s more competition at the bottom of the tree than at the top. And competition in large numbers doesn’t just decrease general odds of winning. It creates underperformance.
9. 10x Thinking: “The Rocketeer” > 179/2490
merely knowing there are more competitors in a competition decreases our performance. Not relative to a group, but in absolute terms.
9. 10x Thinking: “The Rocketeer” > 179/2492
They call this the N-Effect. To prove it,
9. 10x Thinking: “The Rocketeer” > 180/2496
with few competitors, students pushed themselves harder, without even realizing it.
9. 10x Thinking: “The Rocketeer” > 180/2497
The N-Effect has been confirmed in other settings as well, such as standardized tests like the SAT and ACT.
9. 10x Thinking: “The Rocketeer” > 180/2509
human nature makes us surprisingly willing to support big ideals and big swings.
9. 10x Thinking: “The Rocketeer” > 186/2591
Big causes attract big believers, big investors, big capital, big-name advisers, and big talent. They force us to rethink
9. 10x Thinking: “The Rocketeer” > 186/2592
convention and hack the ladder of success. To engage with masters and to leverage waves and platforms and superconnectors. To swing and to simplify, to quickly turn failure into feedback. To become not just bigger, but truly better.
Edwards had no sneaker design mentor in the early days, so he copied his favorite shoes down on paper.
Along his journey, Edwards built a powerful network and a name for himself in the industry.
About the Publisher
The original version of this oft-misattributed quote appears to be from a 1981 Narcotics Anonymous handbook.