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The second week of unemployment numbers in the US were just released and they’re absolutely staggering.
10 million is the headline number. KPMG estimates that the decimation of the consumer economy could bring this number to 20 million within a few months.
It’s a scary time for everyone. For me, it’s scary to be a solopreneur. I have zero cash flow visibility beyond June 1st (notwithstanding, $2k of monthly health insurance premiums).
And since the start of the crisis, I’ve heard from countless RadReaders who have lived through unimaginable economic reversals in less than a month.
One reader shut down nearly 100 fitness studios and laid off all but two employees.
Another shut down an entire manufacturing plant – if the lockdown extends beyond June he won’t be able to cover the commercial lease.
A niche money manager saw their revenues plummet by 45%… in 2 weeks.
But in nearly every conversation, some recurring themes have emerged.
First and foremost, everyone is grateful for their own health (and that of their loved ones).
Next, there’s reverence and humility towards the countless medical professionals, grocery employees, delivery-persons and millions of behind-the-scenes essential workers who are putting themselves at risk – just so that we can have some semblance of normal and socially distant lives.
(I hope that every city in the world can begin their own clap because we care tradition.)
And finally, they’re optimistic. Not blind optimism that “everything will be ok” – because there’s too much uncertainty to know that with 100% confidence.
But a pragmatic and humble confidence thar results in the belief of their own resilience.
RadReaders are an anti-fragile bunch.
And Nassim Taleb is quite good at naming his books.
On the left, we have The Black Swan – an unpredictable event characterized by extreme rarity and their severe impact. The Coronavirus is a textbook Black Swan event. How on earth could we have ever anticipated that 20% of the world would be locked down in their homes for months?
And on the right, we have Antifragility – entities and organisms” that gain from disorder.” Taleb argues that being antifragile extends beyond resilience and robustness: The resilient resists shocks and stays the same; the antifragile gets better.
And while not a single soul would have welcomed this pandemic – as of today, it’s our new normal. And we have a choice in controlling how we react. Taleb goes takes this a step further:
The antifragile loves randomness and uncertainty. Antifragility has a singular property of allowing us to deal with the unknown, to do things without understanding them— and do them well.
I have heard and read countless examples of anti-fragility in the time of the Coronavirus.
Here are 6 principles that have emerged:
#1: Servant leadership
“Times of crisis demonstrate essential truths about individuals.”
And one of those truths is how you serve others. In both calm and calamitous times, the strength of your relationships will correlate to your antifragility.
Servant leadership is about raising the tides to lift all boats. This includes direct reports, clients, suppliers, prospects, board members, vendors and investors. Some questions to tease this out:
- Are you reliable?
- Do you genuinely care for others?
- Do you want them to succeed before you do?
- Do you act with integrity, even when no one’s looking?
- Do you communicate with Radical Candor?
- Do you make people smile?
In the antifragile assessment quiz I pose a simple question: If you were in a bind and needed work, how many people would wholeheartedly go to bat on your behalf?
#2: Be wise about cashflow
The spigot of easy money is gone. And with that went dividend buybacks, eye-popping valuations, delusional customer acquisition costs and broken unit economics.
But not for the anti-fragile. Consider that just yesterday (in a shut down market for VC funding), Notion raised $50 mm at $2 bn. How was that possible?
First, at 42 employees, they are lean and profitable. They didn’t NEED to raise the money.
Second, according to the NY Times they are “emblematic of the type of the kind of technology start-up that may be in a position to survive the shakeout as they help office workers, now quarantined in their homes, work together more seamlessly.” They’re adaptable.
The cashflow antifragility extends to individuals. For months now, I’ve been banging the drum to the RadReads community about understanding their annual spending with a high degree confidence. Some of you have listened… but most have not.
Being economically resilient means having a clear-eyed and precise understanding of where your cash goes each month. Full stop.
Those who have done this analysis are demonstrating incredible antifragility right now. They are taking risks. Buying stocks. Reinvesting into their own businesses. And when we emerge from this crisis, they’ll be the emerge as the dominant players in their fields.
(And tbc, I have zero financial relationship with Notion.)
#3: Find your leverage
And no, I’m not talking about a leveraged buyout to do a dividend recap. In the book, The Million Dollar, 1-Person Business Elaine Poefeldt shares the staggering statistic that there are 1.97 million single person businesses generating over $100k a year in the US.
Now we shouldn’t assume that these are all antifragile. Some could likely have sector or customer concentrations to clients that are reeling from the virus.
But we can also safely assume that these businesses have tremendous operating leverage thanks to technology (which as an unexpected aside, likely makes them socially distant compliant).
Poefeldt describes how these companies have found “creative ways to extend what one person can do [such as finding] fantastic team of reliable contractors; others have found ways to automate routine tasks, such as managing email contacts with customers, so they can focus on what they do best.”
RadReads is checks one of the two boxes of a 1 Person, 1 Million Dollar Business. (Unfortunately, not the $$$ box) but here’s a look at my “tech stack” that powers my 1 person, Six-figure Business ?
The RadReads tech stack is costs roughly $4,000 a year:
- ConvertKit ($2,160 a year)
- Teachable ($725)
- Superhuman ($360)
- Typeform ($360)
- Zapier ($240)
- Zoom ($180)
- Canva ($120)
- Dropbox ($120)
- Loom ($96)
- Notion ($48)
- TextExpander ($48)
- Carrd.co ($49)
- GSuite ($60)
But this isn’t just for solopreneur indie hackers. Just yesterday, I spoke with a grey haired consultant from a storied management consulting firm. Since consultants can no longer go onsite to see clients, he needed a tech tool to iterate and rank ideas, hypothesis, and experiments.
He landed on Airtable (since Notion can’t do embedded forms) and here was his gleeful response:
#4: They adapt
There are some businesses that are doing extremely well during this crisis. Yet even these businesses are facing mountains of scrutiny. Take the newly ubiqitous Zoom. I’d assume that their CEO was sitting pretty right now, but as I was writing this post I saw read this post on the company’s blog.
It turns out that Zoom was conceived as an enterprise tool, one that lived comfortably behind corporate IT firewalls. It was not designed with the foresight that…”… in a matter of weeks, every person in the world would suddenly be working, studying, and socializing from home. We now have a much broader set of users who are utilizing our product in a myriad of unexpected ways, presenting us with challenges we did not anticipate when the platform was conceived.”
In the span of a few weeks, we’ve learned about Zoom bombing, data/privacy leakages and misrepresentations about end-to-end encryption. Even those with strong hands have to adapt to remain antifragile.
#5: They experiment and tinker (and take lots of small risks)
The rules of engagement for business, relationships, and society have been completely rewritten overnight. And that presents every single one of us a creative opening to try something new.
Whether it’s a fashion house repurposing its capabilities and resources to manufacture masks or a fitness instructor pivoting to Zoom-first training sessions, disarray creates vacuums that others can step into.
I’ve got pages of examples this, but here are a few:
- Farnam Street’s pop-up homeschooling YouTube channel
- Portable Provisions pivoting their catering business to feed NYC Medical Workers
- Executive coach (and longtime RadReader) Sunil Arora doing Pro Bono Healthcare coaching
Every single one of us has the opportunity to make a tiny pivot to experiment and serve others. As the saying goes, “never let a good crisis go to waste.”
#6: They stick to simple rules and systems (to stay out of their own way)
I’m not doing a great job here. Exhibit A, my grocery list:
You can tell from my handwriting, that most of my items involve either alcohol or sugar (and in the case of agave BOTH, since it’s for skinny margaritas). But I’m working to re-establish good habits, leaning on my keystone habit (reducing screen time), getting outdoor time to break up the day and frequently communicating with friends and loved ones.
I’ve also collected a list of timeless systems that the community is leaning on to keep one foot in front of the other:
- Getting Things Done by David Allen // Productivity + Workflow
- Sam Harris’ guided meditations on the Waking Up app // Meditation
- You Need a Budget (both the book and app) // Money
- The Soul of Money by Lynn Twist // Abundant thinking
- Essentialism by Greg McKeon // Prioritization
- Give and Take by Adam Grant // Generosity-based relationship building
- The 7 Principles of a Healthy Marriage by John Gottman // Love and marriage
- The PARA method by Tiago Forte // Productivity + Workflow
- Deep Work by Cal Newport // Focus and prioritization
This is by no means a comprehensive list (please send me your additions), but it’s great starting point. All signs point to us being in a marathon, not a sprint – making it imperative that we take great care of ourselves.
After all, antifragility can only be measured over the long run.