Traders are Insects, Entrepreneurs: Mammals
Published by MartinVarsavsky.net in New Ideas with No Comments
I was thinking about people who have made significant amounts of money and their success strategies. I was then comparing those strategies to animals and their offspring and their success strategies. And this is what I found.
If you go through the list of the richest people in the world and take out the heirs focusing on self made (mostly) men, you would see that you can divide wealthy individuals into two main strategies of money making. One is the entrepreneur who has built one or very few businesses, as for example, Michael Dell or Bill Gates. The other one is the trader, who has not managed large organizations and has made thousands of investments in which good ones exceed bad ones, example: George Soros. These individuals have very different strategies and yet when measured by money achieved they have similar results: they are all among the richest people in the world.
Now let´s shift to the animal kingdom. In the animal kingdom the same two strategies appear. Mammals have very few offspring in their lifetime, even the most prolific mammals cannot be compared to any insect, for example, in the amounts of offspring that they have during a lifetime. In my analogy, the entrepreneurs are the mammals and the traders are the insects. Mammals as we know, care for their newborn, feed them, protect them and stay with them for a significant part of their life. Mammals cannot afford many mistakes (dead offspring) as their genes would not prevail in future generations if they did. Insects however frequently accept failure, they play a game of chance, lay thousands of eggs and leave hoping that at least more than a few survive. Interestingly both strategies work and yet in terms of personality they make very different type of animals…traders and entrepreneurs I mean.
When I look around at the people I know I see this division. There´s the traders, and there´s the entrepreneurs. Both can be as successful, but their lifestyles and personalities are completely different. Traders tolerate failure as part of their daily routine. Traders base their success in the frequency of transactions. Very successful traders make an incredible amount of trading decisions. Entrepreneurs on the other side make very few decisions, but they spend much more time thinking, studying, comparing, contrasting, analyzing. Entrepreneurs can´t be as frequently wrong. They don´t have too many chances to pass on their genes.
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Lance Knobel on September 14, 2005 ·
An interesting distinction. Where do you place so-called serial entrepreneurs, like yourself? Or investors like Warren Buffett, who prosper precisely because they don’t make an “incredible amount” of trading decisions. Buffett makes one or two decisions a year, and stands by those decisions for many years to come.
Or maybe I’m wrong to equate investor with trader.
gilles on October 23, 2005 ·
Hi martin , if you like this kind of ressources and references to help understanding of non bio life , psycho, socio, economy, politics … you should read matt riddley , the red queen. a fantastic book
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Rajinder on September 9, 2005 ·
Well… thats definitely a funny comparaison.. looks like you’re into antropological business… have you read desmond morris? his naked ape seems to provide an excellent inside to human – animal comparaisons… sadly he did’nt consider the business “vulture” aspects of wealth accumulation.
I suppose given your biz background and this article that you’re a mammal and I’m probably one too.. but I have to say that being an insect can be fun too… like a wise man once said…
if you think you’re too small to make a difference… try sleeping with a mosquito!!!
Given the current size of my company working against the currents and incumbents… being a mosquito seems to be pretty much a healthy thing to do… haven’t you ever been a mosquito? I’m sure you have…