“Why is there no growth? We’ve tried everything. Nothing is working.”
I was sitting in a local coffeeshop on a grey London morning. My business partner was sipping from a cafe latte with soy milk. I was noticeably annoyed.
“Might as well shut the whole thing down and start something new. This is ridiculous. We’ve been going at this for months.”
I waived my hands in frustration. People were looking.
We really believed we were out of options. That we had tried everything. That we were never going to be a million dollar company.
In reality, we were doing quite well. We had a bit of traction. People downloaded and used the app. We just couldn’t retain them. There was no huge growth in active users.
Back then, I had a “now or never” mindset. Everything had to happen immediately. I was a short term thinker.
In the following years, a series of clues led me to a breakthrough, which completely changed my mindset.
I discovered the concept of lifestyle businesses. Pieter Levels runs his startup Nomadlist as a long-term project. He just keeps adding stuff and making it a little bit better every day. He’s been doing this for several years and his revenue keeps growing. He doesn’t want a quick exit, he’s perfectly happy building and living off of the money he makes with it.
We sold our app a while ago. It continues to do well with the new owner. He experiments a lot and continues to make money.
I discovered the Lindy effect through Nassim Taleb.
The Lindy effect is a concept that the future life expectancy of some non-perishable things like a technology or an idea is proportional to their current age, so that every additional period of survival implies a longer remaining life expectancy. Where the Lindy effect applies, mortality rate decreases with time.
Apps are a great example. The life expectancy of a successful app actually increases with time. The longer an app has been successful on the App Store or Play Store, the longer it will likely remain successful.
Applies to books and diets as well.
I started reading about Amazon and Jeff Bezos:
“I very frequently get the question: ‘What’s going to change in the next 10 years?’ I almost never get the question: ‘What’s not going to change in the next 10 years?’. The second question is actually the more important of the two – because you can build a business strategy around the things that are stable in time. In our retail business, we know that customers want low prices, and I know that’s going to be true 10 years from now. They want fast delivery; they want vast selection. So the effort we put into those things, spinning those things up, we know the energy we put into it today will still be paying off dividends for our customers 10 years from now. When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it.”
Naval Ravikant taught me a few things as well:
“All the benefits in life come from compound interest — money, relationships, habits — anything of importance.”
“Pick an industry where you can play long term games with long term people.”
The best founders I’ve found are the ones who are very long-term thinkers. Even decisions that maybe they shouldn’t care that much about early on, they fix it because they are not building a house, they’re putting bricks in the foundation of the skyscraper, at least in their minds.
“Most entrepreneurial efforts fail, but great entrepreneurs don’t.”
Most of the people Naval met in his twenties that impressed him with their drive and action — almost without exception — found incredible success later on in their 30’s and 40’s.
I no longer get frustrated when an app doesn’t get millions of downloads in the first few months. Building great things takes time.
I stopped caring about short-term rewards. I’m the kid that gets two marshmallows.