Topic Guide
What Is Risk taking?
Risk taking is a subject covered in depth across 2 podcast episodes in our database. Below you'll find key concepts, expert insights, and the top episodes to listen to — all distilled from hours of conversation by leading experts.
Key Concepts in Risk taking
Lottery ticket opportunity
This concept describes an investment or venture that, despite initial appearances or common perception, holds an extremely high, often unexpected, potential for return, much like winning a lottery. In this episode, HL Hunt's purchase of a Texas land plot that unexpectedly contained the largest oil reserve ever discovered is presented as a quintessential 'lottery ticket opportunity'.
Jevons paradox
This economic principle states that as technological progress increases the efficiency with which a resource is used, the rate of consumption of that resource rises due to increased demand. Khosrowshahi applies this to Uber, explaining that making transportation radically more convenient and cheaper expanded the market far beyond the original taxi/black car industry estimates [33:46].
Exponential vs. linear projection
Khosrowshahi observes that humans tend to project future success and transitions in a linear fashion, but new technologies often lead to exponential growth (or decay in the case of turnarounds). Recognizing this difference—the 'hockey stick' versus the 'straight line'—is crucial for spotting opportunities or averting disasters [31:44, 39:53].
Embrace the grind
One of Uber's core values, this concept emphasizes the importance of relentless hard work, discipline, and sustained effort. Khosrowshahi describes it as a learned skill, not an innate trait, that provides a compounding advantage in both professional and personal life [54:14].
Do the right thing. period
This value, personally written by Khosrowshahi for Uber, signifies placing the responsibility on employees to use their judgment in complex situations without explicit instructions. It implies that ethical considerations, such as safety, must always take precedence over pure business goals [64:26].
What Experts Say About Risk taking
- 1.HL Hunt was a "math genius type" and gambler who ran away from home at the age of 15 in the early 1900s.
- 2.He managed to turn a small sum of $50 or $100 from gambling in poker into $100,000, which is presented as equivalent to $3 million today.
- 3.Hunt used his poker winnings to start buying oil leases, despite initially finding the oil business frustrating due to its inherent risks.
- 4.At 36, after selling his other assets, he purchased a plot of land in Texas that proved to be a "lot ticket," containing the largest oil reserve ever discovered.
- 5.His story illustrates a remarkable path to extreme wealth combining early risk-taking, strategic reinvestment, and a significant stroke of luck in a burgeoning industry.
- 6.Dara Khosrowshahi's early experience as a refugee losing everything in Iran instilled a relentless drive to build and a feeling of never taking success for granted, shaping his business philosophy [00:40, 05:08].