Review

Hey guys,

A concept I have been recently exploring is luck. My understanding of it has been inspired by Nassim Taleb, Naval Ravikant, James Austin, and Marc Andreessen. In general, I found that there is a sense of inner comfort knowing the role luck plays in life. 

I thought I would share what I wrote here (note it is a copy and paste). I am curious as to whether 1) if you are familiar with the work of the people above, think I accurate captured their points and 2) in general curious to see if you agree. If you noticed any flaws or issues, please comment as I would like to update my thinking on it (and the blog post).

Hope you guys enjoy it and thanks for reading!

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Earlier this year, I wrote an essay on the role luck (or chance, randomness, etc.) plays in achieving success and wealth. The key insight was this: “Outcomes for many things in life are more influenced by randomness than we think. Said another way, we often confuse luck for skill, randomness for determinism, and coincidence for causality.”

To emphasize my earlier point, skill, hard work, intellect, and other positive personality traits matter. But they are necessary—not sufficient. They do not guarantee success. Luck clearly plays a role, especially in fields such as entrepreneurship and investing, where outcomes are impacted by random events.

But I wanted to revisit this topic because I had a lingering question in my head: Can we make our luck?

What Is Luck?

Before we can determine whether we can create luck, it is essential to define it. The best definition I have seen comes from James Austin, author of Chase, Chance, and Creativity. I was exposed to James Austin’s work through Marc Andreessen’s blog.

Austin defines luck as “something fortuitous that happens unpredictably without discernable human intention.” While this is a great definition, it requires some unpacking—especially the latter half.

Luck is fortuitous and unpredictable. We can’t time it, as we don’t know when or how it will present itself. This maps on to my experiences with luck. But it doesn’t mean we can’t influence luck.

This becomes clear when we examine the latter half of the definition: luck happens without discernable human intention. “Discernable” is the operative word. We might not be able to determine which specific actions or intentions caused luck. But a lack of evidence for causation is not evidence against it. Put another way, just because we don’t know whether a specific action caused luck doesn’t mean that it didn’t. It means that it isn’t discernable—that we don’t know.

This implies that if we are able to determine what the different types of luck are, and what types of actions potentially cause luck, we can increase the probability of luck being on our side.

Four Types of Luck

Austin categorized luck into four major types, whose different characteristics determine whether and how we can influence luck.

1. Blind Luck

Blind luck is the simplest form of luck; it is luck that occurs completely by accident. It happens with no effort on our part, yet it greatly impacts our lives.

The best example of this is where we are born. This is a concept that Warren Buffett calls the “ovarian lottery.” He claims he was blessed by luck because he was born in the United States.

“The odds were fifty-to-one against me being born in the United States in 1930. I won the lottery the day I emerged from the womb by being in the United States instead of in some other country where my chances [of success] would have been way different.”

This concept summarizes blind luck well because it highlights that (1) it is completely outside of our control, and (2) it can greatly impact our lives.

2. Motion-Created Luck

The second form of luck is caused by one factor—motion.

Motion can be described as energy, effort, busyness, hustle, persistence, etc. It occurs when you are running around creating lots of possible opportunities. You are meeting people, experimenting, stirring up dust, and seeing what comes of it.

We can conclude that motion will create some luck. It will bring together random ideas, people, and environmental conditions that collide in fresh combinations. The more in motion you are, the more luck you are creating. The earlier you start and the longer you keep going, the more you increase your odds of creating luck. To use a baseball metaphor, you will have a larger number of “swings at the ball.”

3. Preparation-Created Luck

Another way to increase your exposure to luck is to get good at spotting it. This luck is subtle, indirect, and favours the prepared mind.

This type of luck is created by randomness. A random occurrence creates an opportunity. But the opportunity will be overlooked by most people, except that one person who is uniquely equipped to observe it, grasp its significance, and act on it. This luck requires a special receptivity to the available opportunity.

A great example of preparation-inspired luck is the story of Alexander Fleming and his ground-breaking discovery of penicillin—one of the most important medical discoveries of all time.

Austin describes the situation as follows:

[Fleming] was at his work bench in the laboratory, made an observation, and his mental sequences then went something like this: (1) I see that a mold has fallen by accident into my culture dish; (2) the staphylococcal colonies residing near it failed to grow; (3) therefore, the mold must have secreted something that killed the bacteria; (4) this reminds me of a similar experience I had once before; (5) maybe this new “something” from the mold could be used to kill staphylococci that cause human infections.

The mold falling into the culture dish and the reaction it had with the bacteria were instances of blind luck. But Fleming’s mind was exceptionally well prepared to identify this luck. Through years of study, he had developed expertise in bacteria and microbiology, and he had witnessed a similar reaction once before, leading to the discovery of another drug. When luck appeared, he was prepared to identify it, grasp its significance, and act on it. Had this opportunity presented itself to someone else, they wouldn’t have even noticed.

To best capitalize on this type of luck, you want to develop expertise [1]. You want to become skilled in numerous fields so that when a lucky break happens, you perceive it, and act to capitalize on it.

Louis Pasteur summarized it best when he said, “Chance favors the prepared mind.”

4. Luck That Seeks You

I find this to be the hardest form of luck to understand. It is the type of luck that finds you. You don’t seek this luck; it seeks you. This luck seeks you because of who you are, the uniqueness of your character, and how you behave.

Naval Ravikant, philosopher, entrepreneur and investor, uses a great example to explain this type of luck:

For example, let’s say that you’re the best person in the world at deep-sea underwater diving. You’re known to take on deep-sea underwater dives that nobody else will even attempt to dare.

Then, by sheer luck, somebody finds a sunken treasure ship off the coast. They can’t get it. Well, their luck just became your luck, because they’re going to come to you to get that treasure. You’re going to get paid for it. The person who got lucky by finding the treasure chest, that was blind luck. But them coming to you and asking you to extract it […] You created your own luck. You put yourself in a position to be able to capitalize on that luck.

There are two key insights about this type of luck:

Leverage

When luck seeks you, you become exponentially luckier. It allows you to leverage everyone else’s luck through volume and form.

Let’s go back to the deep-sea diver example. The lucky person who found the sunken treasure could have been blessed by any of the above types of luck. But that doesn’t matter to the diver. As long as someone was blessed by luck, in whatever form, and found sunken treasure, their luck becomes the diver’s luck. The diver now can leverage everyone else’s luck.

Specific Knowledge

The source of this type of luck is specific knowledge. It is when you are exceptional at something, especially something unique, that luck will seek you.

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It is important to understand that the framework above doesn’t guarantee anything. But it does provide a method that we can use to increase our exposure to luck. That way, we too can make our fortunes and call them fate.
 

Comments and Inspirations:

  • [1] Lauren correctly identified that there is an element of open-mindedness here as well. No amount of expertise matters if you are close-minded to alternative ways of looking at things. Thus, the definition of expertise either needs to include open-mindedness or you need to be an open-minded expert.

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