Volume Negates Luck Ep 611

Summary Notes


In a candid discussion, the host and their guest, acquisition.com founder, delve into the entrepreneurial journey, emphasizing the importance of understanding probability and volume in achieving success. They debunk the myth of overnight success and stress that perseverance and the willingness to be initially unskilled are critical. By sharing insights from coaching an 18-year-old neighbor, they illustrate that consistent effort and embracing the learning curve can negate the need for luck and build the skills necessary for success. The conversation also touches on the pitfalls of early wins and the unrealistic expectations fueled by social media, advocating for a long-term perspective on growth and mastery.

Summary Notes

Understanding Success in Entrepreneurship

  • Success in entrepreneurship is not always about doing something different; sometimes it involves persistence through a high volume of attempts.
  • Early success may lead to a misconception that the journey will always be easy, but subsequent challenges require resilience.
  • Entrepreneurs need to understand probability and chance as they relate to business decisions.
  • The likelihood of positive outcomes can be calculated in various aspects of business, such as investments and marketing efforts.

"You might not be doing anything different. You might have just hit the gold nugget way too early in the cycle, and now you got to sift through a lot more no's to get to your next one."

This quote emphasizes that initial success in entrepreneurship can sometimes be a fluke, and continued success requires enduring through many rejections.

"One of the key differences that I see with people who are successful and do grow and do scale is that they have a firm understanding of probability, all right?"

This quote highlights the importance of understanding probability in the growth and scaling of a business, suggesting that successful entrepreneurs are those who grasp the concept of chance and its implications.

Volume Negates Luck

  • Volume of actions in business can reduce the reliance on luck by increasing the probability of success.
  • Entrepreneurs who understand probability use volume strategically to achieve desired outcomes.
  • High volume can compensate for lack of skill (referred to as 'Gil') in the early stages of entrepreneurship.

"Volume negates luck, all right? So if you can put that in your brain, volume negates luck."

This quote conveys the idea that increasing the number of attempts or actions in business can effectively counteract the unpredictable nature of luck.

"If I explain that math to you, I'd be like, is that luck that I closed 500 deals? You'd probably be like, no, that's just probability."

This quote explains that consistent results from high volumes are not due to luck but are predictable outcomes based on probability.

"You can also negate Gil, which is a byproduct of the volume."

This quote introduces the concept of 'Gil' as a lack of skill that can be overcome by increasing the volume of attempts, implying that practice and repetition can improve proficiency in business activities.

Accepting Initial Incompetence

  • The speaker is addressing the unrealistic expectations people have when starting something new, emphasizing that beginners are naturally unskilled.
  • There's a cultural pressure, especially on the younger generation, to achieve immediate success, exemplified by the desire to become a millionaire right away.
  • The fear of being bad at something and the blow to one's ego often leads to giving up prematurely.

"Of course you suck. You're supposed to suck. You're not supposed to be good, right?" This quote highlights the normalcy of being unskilled when first attempting a new endeavor. It's a reassuring statement that sets realistic expectations for beginners.

The Illusion of Instant Success

  • Social media platforms like Instagram create false expectations of immediate success.
  • This misconception is particularly prevalent among younger individuals and can lead to disappointment and abandonment of goals.

"Everyone, especially the guys who are younger right now... they just immediately assume they should be a millionaire the first year." The speaker points out the distorted belief that success, such as becoming a millionaire, should happen almost instantly, which is a common misconception among the youth influenced by social media.

Perseverance Through Volume of Work

  • The speaker suggests that success in activities like cold calling requires a high volume of attempts before achieving a positive result.
  • The speaker uses the example of making 1000 cold calls to secure one deal to illustrate the point about perseverance and volume.

"It should take you about 1000 cold calls to get one deal, right?" This quote serves as a specific example of the volume of effort required to achieve success in a task like cold calling, emphasizing the importance of persistence.

Overcoming the Ego

  • The speaker acknowledges that failing to achieve immediate success can be damaging to one's ego.
  • Many people quit their pursuits because they cannot tolerate the feeling of incompetence.

"It hurts their ego too much to be bad. And so then they say, this isn't for me, right?" The quote discusses the psychological barrier of ego that prevents individuals from continuing efforts in the face of initial failure or lack of skill.

The Importance of a Long-Term Perspective

  • The speaker encourages adopting a long-term view, using the example of improving at cold calling over a year or even five years.
  • Progress should be measured in improvements and skills acquired, not just by the binary outcome of closing a sale.

"If you did this for a straight year... it would be unreasonable for you not to have found one person if you do this for a straight year." This quote emphasizes the importance of commitment over an extended period to achieve success, suggesting that continuous effort will inevitably lead to improvement and results.

Recognizing Incremental Progress

  • The speaker highlights the importance of acknowledging small improvements that contribute to the ultimate goal.
  • The conversation with the neighbor illustrates that skills develop over time, and initial progress might not directly result in a closed sale but is still valuable.

"You have this binary measure of progress, which is I either closed a sale or I didn't close a sale, when in reality there's tons of bricks on the bridge on the way to getting the first dollar over, right?" This quote metaphorically describes the gradual progress made towards a goal, suggesting that there are many small steps involved in achieving success, not just the final outcome.

The Difficulty of the First Success

  • The first deal or dollar earned is identified as the hardest due to the learning curve involved in acquiring necessary skills.
  • The speaker indicates that many people give up after acquiring only one skill or none at all, without recognizing the multitude of skills that need to be developed.

"The first deal, the first dollar, independent of whatever you're doing, is always the hardest one." This quote encapsulates the challenge of achieving the first success in any pursuit, highlighting the steep learning curve that precedes it.

Business Growth and Scaling

  • Entities looking to scale from old business to businesses worth $100 million or more can seek assistance at acquisition.com.
  • Interested parties can apply to discuss potential growth strategies with the team.

old business and wants to get to a much bigger business, going to 5100 million dollars plus, we would love to talk to you.

This quote highlights an invitation to businesses aiming for significant growth to engage with a team that can assist in achieving that goal.

Resilience in Real Estate Wholesaling

  • The real estate wholesaling industry is enduring and profitable.
  • Market inefficiencies between buyers and sellers ensure the wholesaling industry's longevity.
  • Technological advancements could potentially disrupt the industry, but currently, it remains active.

And so I told him that the only way that I would give him my blessing for him to quit is if he could convince me that the entire industry of wholesaling real estate had disappeared.

Speaker B emphasizes the resilience of the real estate wholesaling industry and sets a high bar for quitting, implying that the industry's existence is a reason to persist.

Skill Development Through Volume

  • Skill acquisition is essential to succeed in real estate wholesaling.
  • High volume of work leads to improved skills and "luck" in finding deals.
  • The experience gained from a large volume of calls increases the chances of success.

And the only way to acquire that skill is volume.

Speaker B points out that skill, which is critical for success, can only be developed through extensive practice and experience.

Luck Versus Skill

  • Skill increases the likelihood of success, making it seem like one gets "luckier."
  • Initial success may be due to luck but can provide the conviction to continue.
  • Understanding probability and the role of chance is important for investors and business people.

And the thing is, when you have enough skill, you get luckier, right?

Speaker B suggests that what is often perceived as luck is actually the result of honing one's skills through repeated practice.

The Role of Probability in Business

  • Business and investment success often involve understanding and leveraging probabilities.
  • An early success may skew one's perception of effort and probability.
  • Anomalies in success can lead to questioning one's methods and may require additional effort to achieve subsequent successes.

But the big picture is that people who invest, people who do business at larger scale, just understand probability, right?

Speaker B emphasizes the importance of understanding probability in business, indicating that successful investors and entrepreneurs factor this into their strategies.

The Impact of Early Success

  • Early success can be misleading and potentially detrimental to one's understanding of the effort required for future success.
  • An individual may have to work through more rejections after an early success due to the skewed perception of effort.

How much do you think that messes him up? A ton maybe? Or probably even more than working really hard to get there.

Speaker B is discussing the potential negative impact of achieving success too easily, suggesting that it might create unrealistic expectations about the effort needed for future achievements.

Understanding the Concept of Large Numbers

  • People new to a field often fail to grasp the importance of large numbers in achieving success.
  • Increasing the number of attempts (n) can tilt probability in one's favor and lead to eventual success.
  • Persistence over a longer period is crucial, as most people give up too soon.

"If you want to become lucky, if you want to have probability on your side, you simply increase n, increase the number, increase the volume, and eventually you will strike gold."

This quote emphasizes the strategy of increasing one's efforts to improve the odds of success. It underlines the concept that success is often a numbers game.

The Importance of Correct Execution and Patience

  • Properly executing a system or method is essential from the start to avoid wasting time.
  • Expecting immediate results, especially significant ones like a top 1% income, is unrealistic.
  • Patience and consistent effort are necessary for learning and mastering a new skill.

"Your first three weeks are wasted that you weren't doing it the right way."

Speaker B highlights the wasted effort due to incorrect execution, suggesting that time is lost when a system is not properly followed from the beginning.

Realistic Expectations and Long-Term Commitment

  • Setting realistic goals is key to maintaining motivation and perspective.
  • A long-term commitment to a skill or project can lead to significant results and advantages over others.
  • Experience gained over time is invaluable and often surpasses formal education in terms of real-world success.

"If you do this for four straight years, I was like, do you think it would be reasonable that you'd be able to close one deal a month by the end of that?"

This quote stresses the importance of realistic timelines and the value of consistent effort over several years to achieve professional success.

The Pitfall of Half-Built Bridges

  • Many people fail by not fully committing to a skill or project before moving on to another.
  • The metaphor of building bridges represents the need to fully develop one skill set before jumping to another.
  • The process of skill acquisition is gradual and requires continual effort and learning.

"Most people end up hopping and always doing these half built bridges where they learn two, three, four of the skills, but there's ten that they have to learn."

Speaker B uses the analogy of half-built bridges to describe the common mistake of not fully developing one's skills before moving on to another endeavor.

Perseverance in Skill Development

  • Continuously working on a skill is likened to laying bricks to build a bridge to success.
  • The first dollar earned is symbolic of the initial success after a long period of effort.
  • Identifying and filling gaps in skill or knowledge is part of the journey.

"Keep laying the bricks, keep laying the bricks all the way across the bridge from where you are to where you want to be."

Speaker B encourages perseverance, using the metaphor of laying bricks to represent the ongoing effort required to achieve success in any endeavor.

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