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Little Bets

How Breakthrough Ideas Emerge from Small Discoveries

By Peter Sims
15-minute read
Little Bets: How Breakthrough Ideas Emerge from Small Discoveries by Peter Sims

The core principle of Little Bets is taking actions to discover, develop and test new ideas. Little bets start out small, then develop and are refined over time into potentially life-changing actions. Particularly valuable in times of uncertainty, small actions are cheap, low-risk and quickly put into practice, and are therefore massively helpful when undertaking any project.

  • Entrepreneurs, risk-takers and innovators
  • Anyone struggling to start a big project
  • Anyone wanting to be more creative

Peter Sims is the co-author of the bestselling True North, which was deemed one of the best entrepreneurial advice books by the Wall Street Journal and BusinessWeek. His work has appeared in the Harvard Business Review, Fortune and TechCrunch, and he is a contributor to Reuters and Harvard Business Review blogs. He has spoken or advised at such organizations as Cisco Systems, Eli Lilly, Current Media, Molson Coors, Qualcomm and Frost & Sullivan.

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Little Bets

How Breakthrough Ideas Emerge from Small Discoveries

By Peter Sims
  • Read in 15 minutes
  • Contains 9 key ideas
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Little Bets: How Breakthrough Ideas Emerge from Small Discoveries by Peter Sims
Synopsis

The core principle of Little Bets is taking actions to discover, develop and test new ideas. Little bets start out small, then develop and are refined over time into potentially life-changing actions. Particularly valuable in times of uncertainty, small actions are cheap, low-risk and quickly put into practice, and are therefore massively helpful when undertaking any project.

Key idea 1 of 9

Take small, concrete actions instead of struggling through big, elaborate plans.

A common lesson MBA students pick up in business school is that there’s no point starting a new business till they have a “great idea.” Wrong! Exceptional entrepreneurs don’t work like that. Rather than beginning with a great idea, they discover them when they’re already working on a smaller concept. Google didn’t set out to dominate the internet. They just wanted to improve web searches.

To see your small concept grow into a Google-sized success, you should steer clear of top-heavy planning, as this hinders your chances of discovering new ideas and opportunities. Hewlett-Packard co-founder Bill Hewlett understood this, and bolstered his firm’s fortunes by making a brilliant “little bet.”

HP needed to expand, but was surrounded by established markets which were already full of competitors. So in 1972, under Bill Hewlett’s guidance, HP introduced the first scientific calculator to the market, even though research advised against it due to its hefty price of $400. It was niche, and they didn’t have to “bet the farm” when they went into production. The calculator was a success, and HP were free to explore a new market without having to contend with competition.

A “little bet” has the advantage of being cheap, quick, and of letting you work your way through uncertainty. Market trends and technology can be unpredictable, but because small steps are low-cost and can be launched speedily, companies won’t collapse if one bet fails.

If HP had tried to change their entire company from root to branch, and over-planned their next move, the pressure on everyone not to fail would have been stifling. No one would have wanted to take the risks required to be truly innovative.

Another great thing about little bets is that even if they go wrong, they allow us to fail swiftly and learn from the outcome. An uncompromising top-down approach can mean a slow-burning, more damaging result.

As you’ll see, a little-bets approach cultivates a growth mind-set, which leads to fresh ideas. What’s a growth mind-set? And how can you come up with little bets? The next blink will show you.

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