The certainty of uncertainty

Unknowns will happen. Build to benefit from them.

In venture capital, we say we take “risk.” Even the word venture capital itself is capital de risque in French, or quite literally capital of risk.

But what we face isn’t actually risk. It’s uncertainty. And there’s an infinite difference between the two.

Risk is what we think may happen. Quantifiable. Lottery tickets, poker games, exam pass rates. If we can map out all potential scenarios, we can hedge the downside cases. We may still lose, but we know the theoretical odds.

Uncertainty, on the other hand, isn’t measurable. We don’t know what may happen. Even worse, we don’t even know what we don’t know. Black swan events like COVID-19 aren't rare. In complex systems (our planet, our markets, our lives), they're inevitable.

Startups, like any complex system, have uncertainty embedded. Change and uncertainty are the only constant. We can’t possibly hedge against all downside scenarios or bet on all upside scenarios.

Hence venture capital is capital of uncertainty. How to invest and return capital when uncertainty is guaranteed. Because we know that unknown unknowns will make or break us.

In a world where AI gives answers before we even ask, certainty is being outsourced. But uncertainty is where humans still reign.

Uncertainty makes us

We assume that tomorrow will be a slightly improved version of today. But history tells us otherwise. Most of what shapes today’s society were not linear extrapolations of the past. Revolutions, paradigm shifts, technological explosions were all disruptions.

We like to say in hindsight we saw it coming. But of course we didn’t.

The most important events in our lives were unknowable until they arrived.

The best people. The best jobs. The best places. We could not have known these greatest things that happened to our lives in advance.

Which means the best strategy isn’t controlling the future or probability-based bet, but rather building ourselves to welcome uncertainty.

Something unknown will happen. How can we survive it well. How can we benefit from it well?

Fear won’t save us

When we think of uncertainty, we often feel fear. Because something unfamiliar will come our way, we fear not knowing what will happen to us.

The mind spirals: What if this fails? What if I’m not good enough? What if I lose everything? What if, what if.

We fear the potential threat and get paralyzed.

So we overthink. We overprepare. We overcontrol.

And the paradox is that The more we try to do something to avoid unknowns, the more fragile we become.

If our need to know is driving us, we are bound to be let down. Because the unknown is infinite while our certainty is finite, infinitely less than the unknown.

How to build for the unknowable

So what do we do if we can’t predict or control?

We build systems that benefit from chaos. That grow stronger with shocks. That’s antifragility.

If a bad event will happen but we can’t predict how or when, we focus on making the system antifragile. A beautiful concept from statistician and risk philosopher Nassim Taleb.

So how can we make ourselves antifragile?

Extreme exposure and inner circle.

Being constantly exposed to very different environments prepares us to be adaptive to any negative shock. Being exposed to different people also increases surface area to serendipity. Comfort zone makes us fragile, so let us make ourselves uncomfortable.

Inner circle is social support system but built on unconditional acceptance and care. Extreme cases call for strong support. What counts isn’t just a number of social media followers or how many casual chats you have, but rather a very few people in our lives who support and care for you when great or terrible unforeseen events happen. This doesn’t come free. It takes presence, energy, and the daily work of becoming lovable, by others, and by ourselves. But this support can mean life or death when black swan events happen to us (or them).

I see the difference clearly between first time founders with weak social support system and startup-experienced founders with strong inner circle. Bad events happen to everyone. But those with an inner circle, people who love them regardless of outcome, come back stronger. Often clearer about why they want to succeed.

The strongest people in venture and life are rarely the ones with the smartest plans, but the capacity to throw away their plans and adapt to the new environment with great people around them.

With extreme exposure and inner circle as our ultimate anti fragility, we can turn any uncertainty from a persistent source of fear to opportunity for love actualization.

Unknow ourselves

Uncertainty is not the enemy. Uncertainty is the default. Part of nature. Part of our lives. Part of us.

We can’t beat or control uncertainty. But we can build ourselves for uncertainty. We can unknow ourselves.

We can expose ourselves to life, to nature, to a world more complex than we’ll ever grasp, but more connected than we know. We love others and love us. We can make ourselves to be so integrated, so rooted, so united that when uncertain events come around, we are not shattered but simply reshaped.

We rise. We expand. Wiser. Stronger. Sharper. Clearer. And more truly ourselves.

So let us ask ourselves:

What can I do to face the uncertainty I am most scared of?