The Calculus of Conviction:

The few. Not the many. The concentrated. Not the distributed. The lever. Not the fulcrum.

From the products we buy to the rules we follow, majority rule has little to do with it. Our lives are dictated by small forces with disproportionate leverage. This is the principle of asymmetry. While hidden from the unassuming, it is a principle that resonates markedly with the few who seek to extract the alchemy behind its simplicity.

A subtle example comes from language.

The English language contains over 700,000 words––reflecting the possibility for how we choose to communicate. But our daily lives are constrained to a mere 700 of them. In this domain, mastery doesn’t lie in accumulation, but in selection. By discarding the vast majority and wielding only an essential few, we unlock language.

The 80/20 principle illustrates asymmetry at its core: in any system, a small subset of inputs (20%) often accounts for a large proportion of outputs (80%).

But communication doesn't present an 80/20 dynamic—it’s an extreme form of imbalance that accentuates how asymmetry can scale, illustrating a natural tendency of hyper-concentration.

Returning to our language example, we don’t observe an 80/20, we experience a 99/0.01: 99% of the words we use daily are made up of just .01% of the words in our language.

Asymmetry also shapes behavior.

While many companies strive for mass appeal, chasing an elusive average customer, some exceptional ones understand the power of intentional exclusion. Let's consider Costco.

Costco charges a $60 membership, creating a filter that shapes its customer base. It’s an inverse approach–keeping people out as much as it about keeping people in. Dropping the membership fee would undoubtedly yield a short-term revenue boost as bargain hunters flock to its aisles. But without skin in the game of an annual fee, Costco would attract a different kind of customer – one more likely to exploit its generous return policy, abuse free samples, or treat the warehouse as an all-you-can-return buffet.

Over time, this shift would erode Costco's margins, diminish the quality of the customer experience, and ultimately undermine its competitive advantage. Costco thus chooses a strategy of intentional exclusion. The $60 is less a revenue stream and more a moat – a carefully constructed barrier to entry.

Costco understands that cultivating the right customer is more valuable than attracting the average one. The membership fee less about revenue, and much more about affiliation. It’s about creating a community of customers united by a shared belief: that value is worth paying for.

Although it may seem counterintuitive, this approach creates a powerful outcome: a more engaged customer base, predictable revenue, and a distinct competitive edge.

For Costco, access is the currency, and loyalty is the reward.

Asymmetry is fractal, repeating across domains and measures. From language to retail, the influence of imbalance offers a glimpse into the motor behind power.

At a macro level, there's no better demonstration of asymmetry's effect than in venture capital, a $1.2 trillion asset class. Against the backdrop of a $27 trillion US GDP, venture capital appears as a footnote in the financial narrative. But appearances can be deceiving: this small asset class wields outsized influence.

Venture capital is a craft of conviction. It's a catalyst that propels half of all public market listings, drives three-quarters of their market cap, and fuels nine-tenths of all R&D spending – the very engine of innovation.

From garage startups and dorm room projects, fortified by early venture capital conviction, emerged today’s tech giants. Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, Tesla – seven companies – now shape the very fabric of modern life.

As these mighty seven emerged, software was determined to eat the world. And venture capital provided the silverware.

For those who harness asymmetry, leverage, as evidenced by those seven names, is the reward.

To exploit the power of asymmetry demands that we see the world not as it is, but as it could be.

While our culture rewards the gravitational pull of statistical comfort, harnessing asymmetry demands that we look to Calculus.

This is precisely the mindset that separates the founders who build incremental solutions from those who create category-defining ones.

Approaching decisions based on statistics confines such decisions to expectation and conformity.

Statistics is the language of the collective, where data points cluster around the mean, and deviations are anomalies to be corrected, dismissed as flukes, outliers, aberrations.

Statistics echoes the known, the predictable, and the safe pathways, where every action has a calculable reaction. It whispers the assurances of averages, medians, and modes. It operates under the illusion that the future is merely the past, quantified and projected forward.

For a founder, the statistical mindset burdens them with data and the predictable logic that follows. They analyze trends, mistaking a map for their territory, crafting plans that, for all their meticulous detail, lead only to the worn paths, already charted.

In 2008, Tobi Lutke walked the stretch of Sand Hill Road, carrying a vision for Shopify that would reshape e-commerce. But in the conference rooms of Menlo Park’s storied firms, even those best positioned to back the next breakthrough were bounded by statistical certainty.

The prevailing logic at the time was that e-commerce belonged to Amazon. Investors, armed with spreadsheets and market analyses, saw no room for a new entrant. Their questions traced the boundaries of the known: How big is the current market? Who are the current competitors?

Each question reinforced the constraints of what had been, at the cost of what could be.

Statistics finds certainty in the known; calculus, opportunity in the unknown.

Where statistics dismisses flukes, outliers, and aberrations, this mindset embraces them as chances to define the yet-to-be.

Those who embrace this way of thinking see statistics as only a starting point.

They acknowledge the patterns of the past, choosing instead to forge their own.

They transcend inherit designs, architecting new realities.

The approach invites us to consider not only the reality of change, but also its subtle dynamics, recognizing that even minor adjustments, when compounded over time, can yield a cascade of far-reaching consequences.

It seeks not to predict the future through shadows of the present, but to carve it into existence. It hunts for hidden levers: those precise points where futures pivot into being.

Lutke at Shopify, armed not with spreadsheets but with vision, saw a different future. He understood that Shopify's potential wasn't limited to the existing market; it was defined by the possibility of creating a new one.

He was asking a new question: What if we democratized e-commerce, empowering anyone with a product and an internet connection, to transact?

The investors missed it—the vision, the inflection point, the potential.

They were bound by the known, while Lutke embraced the power of the yet-to-be.

Today, Shopify's two million merchants and $90 billion market cap stand as testament to one man's asymmetric vision.

Where statisticians saw a negligible market in individual entrepreneurs, Lutke spotted leverage. This “insignificant” adjustment unlocked a cascade, reshaping the very architecture of e-commerce.

This is the power of asymmetry, harnessed through mindset: to identify the hidden levers of influence, the subtle points of inflection, and by exploiting them, to achieve results that defy the limits of the statistical.