Nassim Taleb is one of the more influential and provocative authors of recent decades. His work on randomness and uncertainty popularized the concept of ‘black swans,’ even to the point of predicting the Great Recession of 2008, which few had seen coming.
His book Antifragile has recently caught the attention of entrepreneurs due to its namesake concept: the idea that systems can be set up to gain from disaster. What wouldn’t business love thrive amid a recession? It’s especially intriguing now that we’ve gone through a pandemic and seen some companies prosper while many others have shut down for good.
Yet while many entrepreneurs are testing the promise of becoming antifragile, few have trained their objectives on a personal level. Is it possible to start a business and stand to gain, not only if it succeeds, but even if it fails?
An impossible task?
Taleb coined the word ‘antifragile’ because he found no extant term to describe a property representing growth from failure or stress. We use fragility to describe something that will break in response to stress and resilience to denote a tolerance for the same factors.
But the closest thing we have to the opposite of fragile might be the phrase “what doesn’t kill you makes you stronger.” For a business to be antifragile to the pandemic, for instance, it wouldn’t be enough to weather the storm of supply chain disruptions and lockdown measures. It would have to actually thrive as a result of what happened, which we’ve seen in the case of Amazon or various tech companies.
In light of this, it seems nearly impossible for an entrepreneur to become antifragile to the stressor of a failed business venture. You have, by definition, failed. But it’s possible to grow even from this setback.
Evidence for antifragility
One of the key qualities that set entrepreneurs apart from the average person is their resilience. They have a capacity to frame their responses positively and a generally greater appetite for challenge and risk.
Resilience isn’t the same thing as being antifragile. But research has shown that entrepreneurs have a greater ability to recover from failure and start over again. The phenomenon of the serial entrepreneur isn’t even unique to Western culture. Studies in China and Taiwan reflect the same motivation for subsequent entrepreneurial activity.
If you fail in business, you learn lessons that help you make better decisions and start over with higher chances of succeeding. And even for those who exit completely, the numbers are in their favor. Those who return to employment after persisting in business for at least two years have higher career earnings, on average than their non-entrepreneurial counterparts.
Managing the risk
There’s ample evidence to suggest that entrepreneurs can transcend resilience and be personally antifragile to failure.
For that to become a reality, however, we have to consider the real costs of failure. You could end up losing a substantial amount of money and spend a lot of time in the process of learning and growing stronger.
Taleb’s work emphasizes the power of optionality and mitigating risk. If you perceive, correctly, that starting a business for the first time is a high-risk proposition, you have to manage your investment accordingly.
Avoid losing more capital than necessary by exploring alternate funding options, such as crowdsourcing. Use methods like the minimum viable product to fail fast and learn quickly. Leverage strategic marketing services and other forms of expertise you can acquire at scale for a fraction of the cost.
Above all, keep a day job while you’re still in the process of figuring things out. That way, if things don’t work out, you still have a reliable income and the option of continuing on your career path wiser for the experience.