08.07.22 - A most “convenient” size
“For every type of animal there is a most convenient size, and a change in size inevitably carries with it a change of form.” —JBS Haldane
As in nature, so in business.
Bigger is not always better. In fact, for most cases, bigger is worse.
I learned this first in real estate.
Buying 30 houses a month seemed better than buying 10. Except that it wasn’t.
There was a “most convenient size,” and as we moved beyond that size the entire model had to be reconfigured.
Fixed costs rise.
Monthly targets rise.
Management must shift and grow.
And before you know it there’s a legitimate risk that begins to surface: “do I WANT this?”
More seemed better.
Then it wasn’t.
You can see this reiterated all over my messaging because it’s a lesson I’ve learned intimately. Growing too big, too fast, is not the way.
A small firm running efficiently, with built-in security, predictability, and quality controls — is superior, in every way, to a BIG firm that runs redlined without proper control.
There is a most convenient size for the “organism” that is your business. It is a living, breathing, adapting machine — the way to sustain growth is to model nature.
Ebb and flow comes from nature.
Slow growth comes from nature.
Antifragility comes from nature.
-Taylor
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Happy Sunday, get ready for INCREASE.
Fantastic piece Taylor!
I wrote a little about optimalism as well, amongst other things (US 5Y5Y real-rates, the labour market, Louboutin heels) in my latest monthly editorial:
https://hxllywxxdvices.substack.com/p/hxllywxxdvices?utm_campaign=post&utm_source=direct