How Companies Use Bet Sizing to Keep Innovating

Gokul (@gokulr) has worked with generational founders like Brian Armstrong (@brian_armstrong), Jack Dorsey (@jack), and Tony Xu (@t_xu). Here he explains how great companies use "bet sizing" to keep innovating: "Every company has a core business, but if they don't take any bets alongside the core business then they're destined to fail". The Founding Partner of @MarathonMP break this down into three core principles: 1. Allocate Resources: "A core business should have about 70% of resources. The remaining 30% can be used to make four or five bets, with each bet maybe having 5% of resources". 2. Time-box and Goal-Set: "Give these bets a certain amount of time and a specific goal to hit. The first goal is typically "product market fit," where you have maybe a hundred customers who "love you and use your product on a daily, very regular basis". 3. Double Down: If a bet hits its goal, you "double down" and act like an investor, seeding the bets and figuring out which one deserves "Series A investment". @gokulr mentions that @coinbase has 12 products worth more than $100M and "almost every single one of them outside of the core transaction marketpalce started as a bet". "You never bet the whole company, but you got to take multiple bets".