To become one of the most highly successful people of your time, you have to take extreme risk — right?
Grant tells Business Insider that he used to think originals, or non-conformists who think of the world in a different way and take actions to make it a reality, were big risk-takers. That is until he looked at the data.
“It turns out most successful originals are just as cautious as the rest of us,” he says. “They hate to lose money, they hate to have low odds of success, and what they often do is, when they know they have to take a gamble in one domain, they will offset that by being really safe in another domain.”
The most successful innovators hedge their bets.
When management researchers from the University of Wisconsin tracked more than 5,000 Americans who became entrepreneurs over the course of 12 years, they found that the entrepreneurs who hedged their bets by starting their companies while keeping their day jobs were 33% less likely to fail than those who quit their day jobs to start their business.
And anecdotal evidence bears this out.
As Grant highlights in his book, Warby Parker’s cofounders were taking classes at Wharton six months before launching their company, unwilling to drop out. And they all had job options lined up for after graduation.
Steve Wozniak continued working full-time as a Hewlett-Packard engineer for a year after inventing the Apple I computer and starting the company with Steve Jobs.
And it took Sergey Brin and Larry Page two years after figuring out how to dramatically improve internet searches to leave Stanford and start Google.
“We’ve all looked up to people who have the courage to risk everything and put their college degrees or even their jobs on the line to start something new,” Grant tells Business Insider. But as Bill Gates illustrates, this isn’t always the full picture.
“The story is, he dropped out of college because he believed so much in Microsoft,” he says. “But if you actually trace back to that story, it’s not quite how the narrative goes.”
“He didn’t drop out of college; he got a leave of absence so if Microsoft didn’t work out, he could go back,” Grant says. What’s more, Gates already had tested out his idea for a year and had investors interested in paying him for his software. “So he knew he had something of real value, and he knew he had a backup plan just in case,” Grant says.
“I think that that story is not quite as well told; it doesn’t quite fit as much with the ‘American Dream’ of having a big idea and then diving into it,” Grant says. “But it’s much more of the reality of how most originals bring their ideas into they world — they say, ‘You know what, I’m going to play it safe here, I’m going to try this out, and ultimately make it work.'”
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