In the podcast How I Built This, Guy Raz explores the stories behind some of the best known companies. He often ends the podcast asking how much of the companies success was luck versus hard work and skill. Being overly obsessed with introspection I tried asking this question to myself. How much of my accomplishments were due to luck? Well this question was hard to answer because what is "luck"?

I have a fair six sided die that costs $3.5 to roll and pays out the amount that is shown face up. If I roll a six most people will say I'm lucky. Let's say I now know the die is weighted towards showing a six. I roll again and I hit a six. Am I still lucky? Now say there are 100 die and I know one of them is weighted towards six. I play all the die until I figure out which one is weighted. Once I've done that I continue to play the weighted die. I seem to always win, am I just lucky?

If we looked purely at the outcome of rolling a six we would say everyone is equally lucky. However, knowing the full parameters of the game you can there are other factors that influenced their "luck". In real world scenarios, all the parameters are rarely known. We see the outcome and we simply say "wow they're incredibly lucky".

Four Types of Luck

There's a theory that there are four kinds of luck that I picked up from Naval (originating from the book Chase, Chance, and Creativity). Blind luck, luck from motion, luck from preparation and luck due to your character.

This is what typically comes to mind when we think of luck. It is luck that is completely out of your control.

This is simply rolling the die and hitting a six on the first roll. That's plain blind luck.

Blind luck is luck you cannot control.

Luck from Motion

Motion or action results in luck! If you try something enough times you eventually get "lucky". In statistical analysis there is a term known as p-value which is conceptually what is the chance of an extreme event being observed under a given hypothesis. We typically reject a hypothesis if the p-value is less than 0.05. However, note that chance is non-zero. In fact if we run the experiment enough times and don't correct for this we could end up with a result that actually accepts the hypothesis.

If we compare to speed-runners and we only look at their world record attempt we sit in awe as to how lucky they are. However, we discount all the prior hundreds or thousands of attempts they took to generate said luck.

This is rolling the die over and over. Eventually, you'll hit a six and by observing simply the outcome you are lucky!

Simply by doing you will generate luck.

Luck from Preparation

Another common saying is "luck is what happens when preparation meets opportunity". You can say everyone has "blind luck" but we don't say they're lucky unless they take advantage of it. This comes through preparation. By being prepared you can not only take advantage of lucky situations you can also more easily spot it.

The stock market is a great example of luck from preparation. Investors are able to be incredibly lucky by doing their research and understanding the technical analysis. They can take advantages of situations in the market as they are able to spot the inefficiencies.

This is being able to understand how to do the analysis of the die to understand which one is weighted slightly then taking advantage of that.

Luck favors the prepared.

Luck from your Character

This is the most intriguing type of luck out of them all. This is luck that comes to you simply by who you are. Naval has a great example:

For example, let’s say that you’re the best person in the world at deep sea underwater diving. You’re known to take on deep sea underwater dives that nobody else will even attempt to dare.

Then, by sheer luck, somebody finds a sunken treasure ship off the coast. They can’t get it. Well, their luck just became your luck, because they’re going to come to you to get that treasure. You’re going to get paid for it.

Now, that’s an extreme example. The person who got lucky by finding the treasure chest, that was blind luck. But them coming to you and asking you to extract it and having to give you half, that’s not luck.

This is the type of luck that comes to you. If you're known to be the expert in a domain, people will automatically come to you with opportunities.

This would be like after being able to identify loaded dice, people coming to you with more examples of die that they think are loaded.

Luck gravitates towards those with unique skills.

Luck is Everywhere

Given this framework, how much has luck played a factor in my accomplishments?

The simple fact that I'm alive, healthy and born into a life with opportunity is immeasurably lucky. This is pure blind luck but it is not to be underestimated. The simple act of rolling the dice of life again and there are endless scenarios whereby I simply am born at a disadvantage. I was lucky to go to university, not have to work a side job and focus on my studies, etc. However, although this is a large portion of my luck, it is also an area that I cannot control and thus spending energy thinking about this is wasted. Let's look at some more interesting scenarios.

Let's break down some major milestones and the luck that played here.

Getting the Job

Character: I defined myself as someone who's goal was to move to the bay. By simply signaling this character it made me automatically gravitate towards those who had similar interest. This opened up opportunities that I would have never seen independently.

Motion: Simply, by going to many events, applying to endless amount of companies that one of them stuck. Luckily, I was able to attend a FB hackathon which ended up with an interview.

Preparation: Of course practice makes almost perfect. Preparing for the interview, understanding the concepts is not to be undervalued. Having the opportunity isn't enough, needing to execute on it is key.

Blind luck: The interview questions we're luckily those that I could handle. Although, I was prepared there's always an aspect of blind luck dictating how you perform.

Finding the Team

Preparation: One of the compelling reasons to join FB was bootcamp. The ability to sit with a team before you join is not to be undervalued. This was an active choice to prepare me to better be lucky when I pick my team.

Motion: This was less of a factor but a factor nonetheless. During the classes I was focused on looking at a variety of teams and seeing which one fit my interests. Not settling for any team, the continued motion and search ended up with a team I wanted to join.

Blind Luck: The team I wanted to join was in operating systems. It just so happened that during the summer break I took an OS course online just for the fun of it. There's preparation involved such that I decided to take an optional class. There's blind luck that I happened to pick operating systems. Just for some more blind luck I happened to be learning C++ as my language of choice and my first task was in C++!

Growth and Opportunities

Blind Luck: It was almost entirely blind luck that I found the best mentor I could ever ask for. This accelerated my learning by at least an order of magnitude.

Preparation: Simply due to my exposure to certain concepts, I was able to find opportunities that I was uniquely able to tackle. This is incredibly lucky that my personal learning aligned with the role of the job.

Character: By becoming someone who was dependable and was willing to tackle any problems opportunities started to come to my plate.

Improve your Luck

You can improve your luck through putting in hard work. However, not all hard work translates to an equal amount of luck. You can work endlessly and tirelessly preparing but only to find out you're preparing for the wrong thing. Furthermore, you can generate luck through motion but it has diminishing returns.

The last three forms of luck have a trade-off between difficulty to develop vs amount of luck generation.

Motion will provide you near immediate results but is likely only to be helpful in generating luck for your local problem.

Preparedness will return fruits for your labor time and time again as you can apply your skills to different scenarios. However, this also has its limits as it requires you to always you to be continually preparing to generate your luck.

Character is the most scalable form of luck generation as it requires zero effort from your part once developed. Unfortunately, it is the most difficult to build up.

Blind luck is pointless to focus on as you cannot affect it but it is important to be cognizant that it is always at play.

Luck is Generated in the Past

I have this saying which is "my success today is a result of my prior efforts". My luck due to preparedness is almost always something I did 6-12 months ago which resulted in my current success. This is important to note as it means this luck will not stay. You are living off the fruits of labor due to the prior luck generated. This means you need to be continually looking for luck generation. That's just a long winded way to say keep learning :).

Luck Suffers from Survivorship Bias

If you have a fair six sided die that pays out the face number but only costs $2.5 to enter you would play it over and over again. However, individuals only display the highlights of their life meaning they will only display the times they hit a$ 5 or $6. When you roll, you may only be getting$ 1 or $2 and feel demotivated. Wherever you look, it may seem that everyone is incredibly lucky but the reality is far from it.

Fortune Favors the Bold

It's much better to get lucky once with outsized rewards than continually get incrementally lucky. Humans are loss averse and would rather play games that have a less expected utility but results in them winning more frequently. This biases us to safer decisions. To tackle this bias it's important to disconnect the outcome with the decision. If the information you have signaled that if you made the same decision over and over it would result in a net positive then you take that decision 100% of the time. Even if the outcome turns out negative it's important not to be discouraged.

How Lucky Am I?

There is an immense amount of luck that comes into accomplishing anything. When looking at a certain outcome some people seem so much luckier than others. However, as you peer deeper this luck is not simply blind luck but luck generated from hard work.

I would account over 60% of my accomplishments to luck.

I guess I am pretty lucky :).