"Choice matters more than effort" is a phrase I've heard for years but never fully believed, dismissing it as mere success-story鸡汤.
That was until I came across a formula by Paul Graham. He said that if a company starts at $2 million and grows 93% each month for 9.45 months, it becomes $1 billion.
The number sounds astounding, but the truly interesting part is that it doesn't "teach" you how to make $1 billion. The groundbreaking outcome depends solely on the growth rate and the duration.
It really has little to do with so-called "effort."
The illusion of "the harder you work, the luckier you get."
My previous understanding of effort was basically linear: earn 100 this month, earn another 100 next month, and after 100 months you'd save up 10,000. Most people probably think of effort in this model.
But in the world of exponential growth, it's not like that.
The key to exponential growth is that after each round of growth, the new result becomes the base for the next round. At the beginning, it's so slow you doubt it matters. But once the growth rate is high enough and the duration long enough, the later results become increasingly bountiful.
The chessboard parable illustrates this: put 1 grain of wheat on the first square, 2 on the second, 4 on the third, and keep doubling until the 64th square. In the end, the total wheat would be enough to bankrupt a country.
Effort is certainly important—it's the key factor determining your growth rate. Someone with poor execution, slow learning, laziness, and no passion won't seize even the best opportunity.
But effort can't solve the problem of growth duration. If a direction only allows for a short period of growth, even a high growth rate is just a short-term fluctuation. Trends will fade, subsidies will stop, traffic dividends will disappear, platform rules will change, and any amount of effort will only make you hit the ceiling faster.
Conversely, if a direction allows for a long enough growth period, it's okay if the early growth rate isn't that impressive. As long as it keeps rolling, the later results will rapidly expand under the power of compound interest.
That's why some people seem neither smarter nor harder-working than others, but after a few years, others can only see their backs. They may have stood on a growth curve with a longer cycle.
So, "choice matters more than effort" can be translated into mathematical language as as long as your compounding time is long enough, even low growth can create high returns.
This statement is more accurate than "choice matters more than effort."
Many people say, "When the wind comes, even a pig can fly." Though crude, there's some truth behind it.
When users start to embrace something new, the demand for this new thing grows, infrastructure matures, and capital, talent, tools, and channels all start converging in the same direction. An ordinary person just needs to participate, and their effort will be amplified rapidly. Even mistakes don't matter much because the system's growth will cover their errors.
But if a track has already peaked, the situation is completely different. The same effort might only lead to more intense internal competition. Small mistakes could also get you kicked out. Because you're not facing an incremental market; you're facing zero-sum competition.
So my current understanding of "choice matters more than effort" is not that effort is useless, but that effort is only useful when placed in a compounding system.
What kind of system is a compounding system? Paul Graham's criterion is market size.
If the market is large enough, growth has room to keep rolling. A product can start very small, even serving only a small group. For example, Facebook was initially just a social network on campus; Airbnb was initially a temporary solution to insufficient hotel rooms during a design conference. The key isn't how high the starting point is, but whether it can spread from a small need to larger adjacent markets.
This applies to ordinary people's choices as well.
When faced with two opportunities, you shouldn't only look at which one offers higher current returns. You should instead ask: which direction has a longer growth period? Which direction's demand is still increasing? Which direction will allow your experience, relationships, and skills to compound? Which direction won't become obsolete in a year, but becomes more valuable the longer you do it?
A newly emerging demand may have unstable short-term income. But as long as its demand continues to expand, infrastructure will become more mature, users will increase, and its long-term returns will be very substantial.
This is also where most people tend to misjudge.
We are naturally attracted to short-term growth rates. We tend to choose whichever looks more profitable or popular in the moment, and then fool ourselves with "effort pays off."
But the truly important question has never been "Am I working hard enough?" but rather "Am I working hard on the right track?"
Should we try to sell a unit at a higher price in a linear system, or should we make every effort roll and expand in a compounding system?
Not everyone is an entrepreneur, and not every entrepreneur can hatch an Airbnb. The significance of PG's formula for ordinary people is that it gives them a calmer way to judge.
In the future, when making choices, I can first ask myself: Does this direction have enough room for growth? If it's just a short-term dividend, it might not be worth investing too much effort. If it can sustain long-term growth, then it's worth diving into.
"Choice matters more than effort" ultimately isn't about giving up effort, but about reminding us to first see which growth curve we're standing on before we start working hard.
Are you also in this situation? Not knowing where to go, or unclear about your company's business direction? Feel free to tell me, let me help you sort out your issues and find the direction for the next step.