David Heinemeier Hansson

November 5, 2024

What you know that just ain't so

The fun bit about business is in all the answers you don't have. Should we be priced higher or lower or leave it alone? Should we chase these customers over here or those customers over there? Should we add more features or polish the ones we have? There's endless variation in every one of those questions, and you can't reason your way to conclusion. Only testing against reality will really give you an answer. And even then, reality can be "wrong".

Meaning that even valid results of your experiments can steer you astray. Maybe you ran your pricing test too short to know what the second-order effect of losing sign-ups in favor of a higher revenue-per-customer will be, even if it nets out positively for the first year. Maybe presenting your new features came with a new website design, and the latter was what actually moved the needle. It's very hard to reduce any interesting question in business to a perfect experiment. Best you usually get is more or less confidence.

Which is fine! We don't need to know everything for sure before taking action. In fact, the hallmark of a good business person is their ability to make calculated bets based on half a story and a hunch.

But the key is to remember that what you won was a bet, not a trophy made of truth. And while you can to be grateful for the good outcome, you need to remember that whatever conclusions you draw from it need to remain suspect.

This is just as true when you lose the bet. That's when you're liable to believe that "we tried that, didn't work" represents some universal statement of fact. When in reality, the lesson is more like "we tried SOMETHING and that SOMETHING didn't work". In order to remember that "we could try SOMETHING ELSE and THAT might work".

Because if you don't, you'll eventually become a prisoner to every bet you've made. Convinced that half the opportunities in the world just don't apply to your situation and the other half is a slam dunk. Nonsense.

It's okay to collect your winnings even if you aren't exactly sure why you won. It's okay to take some losses even if you can't explain exactly where it went wrong. In fact, it's better than okay to resist coming up with a definitive story either which way. Because as soon as you write that story down, it tends to become rigid rather than open to reinterpretation.

An open mind is always willing to let the story twist, willing to revisit the setup, and willing to test everything from timing to premise on another day.

About David Heinemeier Hansson

Made Basecamp and HEY for the underdogs as co-owner and CTO of 37signals. Created Ruby on Rails. Wrote REWORK, It Doesn't Have to Be Crazy at Work, and REMOTE. Won at Le Mans as a racing driver. Fought the big tech monopolies as an antitrust advocate. Invested in Danish startups.