Survivorship bias: Is it Unscripted?

[The Abundant Man]

"Survivorship bias or survival bias is the logical error of concentrating on the people or things that made it past some selection process and overlooking those that did not, typically because of their lack of visibility. This can lead to false conclusions in several different ways. It is a form of selection bias."-Wikipedia

Survivorship bias in the case of entrepreneurship is that I look to other rich/successful people and think, "If they can do it then I can do it." while ignoring the many people who have failed to get there.

Would you consider this to be scripted bullshit or true?

 

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[Davejemmolly]

I think this is the natural state of mind of an entrepreneur, and what fundamentally sets one apart from the sidewalk / slowlane.

A entrepreneur looks a success stories and thinks 'why not me', where a slow laner looks at all the failures, and thinks 'look at all the business that don't make it'.

It's what make us so resentful to be employees

 

[ZF Lee]

Yes and no. Not really black and white here.


Let us look at an example of why the survivorship bias is indeed a SCRIPT tool.
If you look at common SCRIPTED notions like getting a college degree, the multitudes take this path because they saw engineers and doctors and regular 9-5ers taking in hundreds of thousands with their academic qualifications. Family social norms and societal influence also play reinforcement part here.

So the kids go in, get the degrees and set off to the jobs...and we know what that is leading to.
The folks didn't take note of the numerous factors that could make situations very different to repeat the same circumstances. For instance, not all engineers may have stock tied to the company to earn some dough in an IPO or sellout (variances in monetisation of career). Or liberal arts and other arts degrees became extremely politicised to the point of reducing its marketability.

However, many great concepts or inventions or works used to be touted as 'a chance/lucky' difference by society.

The airplane by the Wright brothers?

Bill Gates' play on the software rights clause in the IBM deal?

Tenzin and Hillary's successful climb to the Everest peak?

When occasions such as these were first introduced, there was little or no track record behind them to prove that they could be repeatable successes. So of course, folks at that time though they were survivorship biases, occurrences springing out of many failures, or in short, the 'lucky one'.

Now, we have a thriving airplane industry. We have people enjoying entertainment and food comfortably as in an on-the-ground hotel in these mysterious vehicles.

Companies pay a lot of attention to IP and legal clauses for potential opportunities. Lawyers and accountants are paid handsomely to find out such weaknesses to protect clients from losing millions.

More climbers can reach Everest's peak. Mountain climbing training and gear has improved spectacularly.

So consider the survivorship bias as just another stage of adoption of UNSCRIPTED ideas. Part of the process.



The question here is that when does a piece of info or concept stop being a survivorship bias? Is it conditional? Can we repeat or improve on the occurrence so much that it can become more regular in appearance?

In a world full of action, I don't believe in luck or survivorship biases or 'by chance' or whatever. Things that we think are new are actually not.

Going back to the college degree example, it can stop being a survivorship bias that the degree is a road to high income if you can do something about the taxation and compensate for the long arduous route of getting professional certified. But you are forcing your own factors or conditions upon the situation by then, so you make that survivorship bias conditional, or a choice.

 

[GoGetter24]

Survivor bias has to be taken into account. There's nothing slowlane about accepting reality.

The only issue is interpretation.
The roughly 1-in-10 business failure rule can be interpreted by a loser as "well then it's too hard so I won't even bother".
But by a winner as "so it's going to be very hard and I'll have to take quite a few cracks at it before something sticks, and I'll be mindful of not taking too much risk on each one".

 

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[luniac]

Does it take millions to be unscripted ? i think anyone who believes that is scripted.

I have to believe anyone can find a way to earn enough to become unscripted . It really doesn't take much does it?

If u are surviving and saving a little working a full time job, literally any amount of extra money from a side hustle is a boon!

lets say u make 100 bucks a week from some side thing, thats still CASH MONEY going into ur savings. Maybe not enough to quit ur job but goddamn it helps so much.

I think in 1st world nations, once u own a piece of property uve pretty much made it. Rent money is the biggest expense of the average person. If u lift that weight of your shoulders, ull be able to save tons of money.

Id be saving tons of money if i didn't have rent to pay, and my heart and mind will rest easy knowing i OWN a piece of shelter, a roof over my head, noone can evict me except uncle sam himself if i dont hand over a bit of property tax.

I think its admirable to shoot for the stars and need less at the same time.

 

[Akeem]

Survival bias or not, we all have had a taste of life. The ups as well as the downs. There are almost 8 billion inhabitants on planet earth and to any sane person, there will obviously be risk and competition involved, whatever the competition itself may be.

Believing in survival bias and stopping yourself from working smart/hard because of it is definitely a part of the script. Yeah, you could've been born into a wealthy family or yeah, you could've been born into a slightly less wealthy family (and assuming you didn't) but tough luck, you didn't. You can either cry about it, work your 9-5 and die or you can try your best to change the outcome of your life. What's the harm in doing that?

A very relevant quote comes to mind when I think about the possibility of failure in any aspect of life:

We're born and that's that. In our possession is a limited amount of time and in that limited amount of time, we have the freewill to engage in whatever we want. So why would one want anything less than to be successful? To work hard, to make money and to live lavishly. Shouldn't that be ones goal no matter who you are? You're not promised another lifetime or an extra few years before death. There is no restart or play again button. You have this one lifetime and that's final. Make it count.​

 

[garyfritz]

Survivor bias has to be taken into account. There's nothing slowlane about accepting reality.

Agree 100%. Ignoring harsh reality is foolish. If you think you're guaranteed to make millions because you read MJ's books and you see others succeeding big, you're likely to risk more than is wise. If success is 100% guaranteed it's smart to risk everything -- but if there's a chance of failure (and there always is) you need to be a bit more cautious. Don't jump off a cliff just because you read a story about Superman. Maybe test your flying skillz by jumping off a chair first. Then while nursing your bruised knees you can re-think your strategy.

On the other hand, if you're certain you can succeed, you're more likely to stick with it and do the work to get to the finish line. If you start out thinking "this is a long shot but I'll give it a try," you're more likely to give up too soon.

So recognize the reality of survivorship, and strike a balance somewhere in the middle.

 

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[MJ DeMarco]

A survivor bias exists in everything, including Unscription.

However I'm more focused on mathematics; specifically immeasurable, but movable probability.

I believe my two books positively MOVE immeasurable probabilities for success, but they will never alleviate a survivor bias.

 

[socaldude]

One of the reasons I hate the book outliers is that it doesn't even take into account that the bell curve can be different. They are not all the same.

Which means probabilities are not the same across the board for everyone.

You can have the same mean but different standard deviation.

 

[Ninjakid]

And you see THIS IS WHY academics spend their lives talking about the accomplishments of more people.

THIS IS WHY people give up on the childhood dreams to work in a cubicle with mortgage and credit card debt up to their eyeballs.

Obviously most people who pursue entrepreneurship are not going to succeed at it. You know why?

Because the successful ones keep going until they make it.

A successful entrepreneur can be someone who failed six times and got rich on the seventh.

A failed entrepreneur may have failed twice and called it quits.

But this quote

"Survivorship bias or survival bias is the logical error of concentrating on the people or things that made it past some selection process and overlooking those that did not, typically because of their lack of visibility. This can lead to false conclusions in several different ways. It is a form of selection bias."-Wikipedia

View attachment 22526

is basically saying people who are determined to succeed are just naïve for thinking they can when so many others fail.

Well I tell you what. Statistics don't matter. Your options are binary. You either do or you don't.

Sure most people don't become rich. But you know what? Some do. These are facts.

 

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[NuclearPuma]

The only way to counter survivorship bias is to also examine those that did not survive.
For anyone wanting to understand human bias better, I recommend "Fooled by Randomness" by Nassim Taleb. One of a handful of books that changed the way I look at things.

Humans cannot properly comprehend the concept of randomness because our brains are evolved to recognize patterns and correlations. So when presented with truely random data, our minds look for patterns and try to come up with correlations where none exist.
This causes us to assign cause and effect relationships where none exist; The outcome will still be random though we think we had some hand in it.

 

[GoGetter24]

The only way to counter survivorship bias is to also examine those that did not survive.

This also has a morale-boosting effect.

I remember when I was doing market research, I found a bunch of data about products that people had made, at clearly significant cost, but were just duds. The patterns between them and the winning products were seemingly obvious, and yet these producers had just continued on brazenly doing the same thing and getting the same pittance results.

Things like:

• Making products that seem like a "good idea", but ignored the fact of clearly almost zero market demand because it didn't address a common pain, or a passion, or really anything that would indicate people would actually buy them.
• Pricing the few products that did sell well, and had no comparable competition, at a silly low price, and then defending that price with stupid reasons, instead of simply following the universal rule "price at what the market will bear".
• Grinding on with a failing business model for years, that clearly wasn't worth the effort invested, instead of shutting it down and trying something else.
• Making a first product, getting a bad review, and then being demoralized and giving up.
• Entering small saturated low-monied markets populated with penny-pinchers.

And then seeing moderate winners or outright winners doing the following:

• Paying attention to market signals (such as google keyword search rates), building things aligned with that, and then selling them at high prices.
• People who made a really shoddy-made product, but it was still a product that satisfactorily addressed a compelling market need, so it sold moderately well (still suffered due to small market though).
• Making very simple solutions to simple but wide-spread problems (I knew a guy who retired young and rich due to this), and attacking that narrowly in earnest, instead of trying to be clever.
• Launching into hot markets, i.e. rapidly bringing something to a market that had recently frothed and people were already throwing money into.

It doesn't matter if there's 1 winner for 9 losers: you can still analyze the patterns and boost your chance of landing in the 1 winner group. You can also take multiple shots at it until you land there, and each shot is practice that makes you more accurate.

 

[ChrisV]

Tackling your biases, any of them... is always unscripted . Biases are literally the definition of a script.

 

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