How do you invest in the growth of new business and new opportunities?
One approach to this challenge is with an antifragile perspective. Nassim Taleb pioneered the idea of “things that gain from disorder” in his eponymous book. To apply his philosophy on antifragile things, he proposed an investment strategy that he named a “Barbell Strategy.”
To apply a barbell strategy, you invest mostly in low risk investments, around 90%, and for the other 10% you invest in high risk, high upside options.
For your business, that might mean 90% of your attention, energy, and cash is on optimizing what is already proven within the business. Often, most of the “low hanging fruit” is inside your company.
The other 10% though, is where you diverge radically from optimization and instead test new ideas that have the potential for a high upside outcome with little downside if it doesn’t work out. Some examples:
- Going to a local conference for an adjacent industry (no travel costs).
- Spending a day playing with an emerging technology.
- Having lunch somewhere good with someone who has no direct relationship to your current business strategy or obstacles.
- Standing up a landing page and “smoke testing” a new offer or a new market.
- And etc.
If you were to employ a barbell investment strategy for your business, how would you ensure that you were making a 90 / 10 investment on a regular basis? Selecting monthly or quarterly objectives against this criteria? Earmarking cash and time in your calendar? Something else?
What would work for you?