Why are we so bad at predicting startup success? | @andrewchen

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Startups and bad predictions. One of my favorite reads this year was Nate Silver’s The Signal and the Noise which has the subtitle Why so many predictions

StartUP Product‘s insight:

Great read and videos:

Key takeaway in the last paragraph:

“Over my 5 years in Silicon Valley, the biggest lesson I’ve learned from trying to predict startups is calibration…..be careful with what you think you know versus what you don’t”

Worth noting:

  • Nate Silver’s The Signal and the Noise which has the subtitle “Why so many predictions fail, but some don’t.” It covers a ton of different topics, from weather to politics to gambling, and I couldn’t help but read it with a startup/tech point of view.
  • 10-15 startups a year generate 97% of the returns in tech, and each one seems like a crazy exception.
  • Ben Horowitz elaborates on the sobering stats, starting at the 38:00 minute mark: http://www.youtube.com/watch?v=1GTbAI_2yh4&feature=player_embedded
  • To be a fox means to draw from a much broader set of data, to look at the problem from multiple perspectives, and to reach a conclusion that combines all of those datapoints.

Aligned with Andrew Chen’s insight, today, on the Global Product Management Talk with Chris Pacione of Luma Institute, we discussed the issue of remaining humble in order to enable innovation – (from the tweets):

“With closeness & domain knowledge comes false understanding – unfresh view, too comfortable, Want multi-disciplinary teams attacking problems – not just domain experts – other perspectives, bckgrounds have insights”

Listen to the full discussion: http://bit.ly/17a6dNl

See on andrewchen.co