Choosing the Hard Way

"There are three ways to make a living in this business: be first; be smarter; or cheat.

Now, I don't cheat. And although I like to think we have some pretty smart people in this building, it sure is a hell of a lot easier to just be first."

Jeremy Irons said it so well in this classic quote from the movie Margin Call.

He also gave a great roadmap for building businesses.

Jeremy Irons’s John Tuld in Margin Call.

The breakdown

Most business plans are complicated and nuanced. Sometimes they have to be.

But no matter how intricate the game plan, no matter how detailed the process - it all starts with first principles.

That is what makes the Jeremy Irons quote so good: it is clear and simple. It also lays out the choice very clearly.

“Cheat.”

Some people make big business by totally fraudulent means. And when they are caught they are rightly punished.

The currently ongoing trial of Sam Bankman-Fried from FTX highlights the perils of constructing an entire business around a lie. When it comes crashing down, there is no escape.

Of course, there are other companies that cheat in a more conservative way. They cut corners, bend the rules and hide key information. This is no sustainable system either.

Then there are those who do not “technically” cheat - but merely take advantage of loopholes, of which there are many. Still others play the “fake it til you make it” game and use smoke and mirrors to make money.

Elizabeth Holmes knows how dangerous that can be.

Cheating, obviously, is no option for building a great business.

“Be smarter.”

This might seem like the best way to build a successful business.

Find a unique idea, design a one-of-a-kind product, find a market that no one else has discovered - the business world is full of geniuses that have an inside track to “the next big thing.”

Many of them succeed - and just as many (or more) do not.

The problem with leaning on brains for success is that it puts you in direct competition with others. You start from the premise that you have to be better than someone else, which in and of itself is limiting. As soon as it “seems” like you have surpassed them, you will feel satisfied and let off the gas.

Competition forces comparisons, thereby fitting you into a box.

And what is worse - in today’s world, artificial intelligence and all the tools built on top of it are levelling the playing field for all but the very smartest of the smart.

Armed with such powerful technology, it will be extremely difficult to outsmart someone.

“Being smarter” is no (sustainable) way to make a living.

“Be first.”

Jeremy Irons’s character John Tuld claims it is “just a hell of a lot easier to be first.”

In the case of the Wall Street firesale that ensued, he was right.

But “being first” is a lot harder than it looks.

It requires foresight to perceive what others may have missed. And then it requires courage to step out before others have started.

There is a reason that we refer to the “first-mover advantage.” In business as in life, the person who takes the very first step with no one to pave the way is often risking everything he or she has.

Being first is “the hard way.”

The Margin Call cast, especially Kevin Spacey’s character, could certainly agree.

But heading down the hard path is what leads to so many unimaginable opportunities. Waiting for someone else to dive in is easy. It requires no skill, no courage, no perseverance, no imagination.

It is risky and as such has fewer rewards.

Choosing the hard way is what leads to ultimate success.