Luck, I would argue, is one of the most important factors in deciding whether a startup succeeds or fails. While hard work and great people–the other two key pillars for startup success–are often repeated prerequisites, luck tends to be downplayed and sidelined.
For the most part, entrepreneurs ignore the value of luck because it minimizes what we entrepreneurs love most–control. We can work tremendously hard to make sure we’ve done everything we can to create the perfect company but if the stars aren’t aligned, it could all be for naught.
But an entrepreneur’s disregard for luck may be one of the primary reasons many are generally so ineffective at harnessing its highly impressive power. Because at its core, embracing luck isn’t about carrying a rabbit’s foot in your pocket, avoiding black cats in the street, or throwing salt over your shoulder; it’s about embracing probabilities and trusting your gut.
Imagine you had the goal of meeting Warren Buffett and the success or failure of your company depended entirely on speaking with the legendary investor. If your method was to go about your normal life with the hopes that you’d run into him, your chance of succeeding would be extremely slim.
However, if you traveled to his hometown of Omaha, Nebraska, researched his three favorite eateries, and then spent the next year switching off going to dinner at each one, the likelihood that you would encounter Mr. Buffett would become inevitable.
Rolling a dice and landing on a specific number in one try has a large element of luck to it, but if you can increase the number of rolls you’re given, then the chances of hitting your number becomes all the more probable.
The same principle applies to startups. Whether it’s looking for partners or trying to secure an investment, entrepreneurs can face a long series of NOs that tend to take a toll on the startup. Your idea may be brilliant, but the specific interests, background, and even current state of mind of an investor may lead to an eventual negative conclusion.
This doesn’t mean that you’re doomed; it just means you need to increase the chances that you’ll meet an investor who does have the proper interests, background, and state of mind.
While working on my current company, I attended an event an old VC friend of mine chaired. As luck would have it, I realized there was one degree of separation between me and Martin Nisenholtz, chief of digital operations for The New York Times, who was in attendance. As any good entrepreneur knows, it’s all about the intro. Ours led to coffee, which led to an invitation to meet his team at The New York Times, which then took us on as a client.
This happenstance of running into my friend on the street, his event, and our mutual connection are all examples of Lady Luck opening the door for opportunity. By focusing solely on this example, one might assume that we were just plain lucky, but this would be ignoring the wider context of the dozens, if not hundreds, of introductions, meetings, and encounters that did not yield any immediate result.
The more chances you create, the more likely the stars will align.
Taking time to understand and analyze quantitative and qualitative information is of critical importance for many entrepreneurial decisions. However, the simple truth is that there isn’t enough time in the day to give every decision the attention we’d like. In order to compensate for the lack of time, entrepreneurs need to learn to sharpen their instincts and trust their gut.
One common case is with the hiring of employees. A CV and a short meeting are certainly not enough to get a full understanding of a candidate’s potential. In fact, sometimes limiting candidates by easily understandable measures, such as past experience, can keep us from bringing in incredibly talented people, who may just lack a specific past job title.
This is when we need to trust our instincts and go with our gut about whether the person is the right fit for the role. Do they have the right energy? Are they independent or will they need more direction?
Two of the most important hires I made at the first startup I founded occurred during casual encounters on plane flights. These individuals had a spark that made me excited, and without rigorous interviewing and back channel references, I offered them a job on the spot. They turned out to be two of the most exceptional colleagues I have ever worked with, and much of our success was directly attributable to their work. It’s clear that following your instincts and trusting your gut can pay off.
Luck plays a key role in the success or failure of any company, but by embracing probabilities and learning to trust our instincts we can turn the odds in our favor.
—Liad Agmon is CEO and cofounder of Dynamic Yield, an automated real-time optimization and personalization engine. He is a serial entrepreneur with rich experience as a startup founder and as a Fortune 500 executive.