The Smart Way to Take a Risk

Failures are inevitable. But, as former Kickstarter CEO Yancey Strickler explains, taking a few chances is essential for an organization's survival.

Business culture is overwhelmed with inspirational catchphrases—“no pain, no gain,” “fake it till you make it,” and so on. Most are as innocuous as that dusty Successories poster nobody looks at down at your local used-car lot. But one of them is actively counterproductive: “Failure is not an option.”

The line has its origin in the space program, and if you are, in fact, shooting people into space, you’re forgiven and welcome to continue using it. But for most of the rest of us—and particularly those in the association world—the line has a chilling effect that shuts down risk-taking and stifles new ideas.

Every organization needs a mix of creative people and managerial, doing-things people. Those aren’t the same person.

I come to this point after interviewing Yancey Strickler, the former cofounder and CEO of the crowdfunding site Kickstarter and Opening Keynote speaker at the ASAE Annual Meeting & Exposition in August. It’s not quite correct to say that Kickstarter operates as a failure-based business, but it’s one where failure isn’t just an option but an opportunity.

Kickstarter shares updated aggregated statistics on how its projects are performing, and it’s held to a pretty consistent failure rate: Only about 36 percent of Kickstarter projects reach the funding goals that creators set for them. Which is fine for Strickler, because he founded the company to be an incubator for new ideas. “We always felt that if the system produced a success rate of 100 percent and every project got funded, there would be something wrong with that,” Strickler told me. “We’re trying to create a system where you are able to explore new ideas and try to do new things. And a system like that has to be tolerant of some amount of risk.”

That said, not all risks are created equal. Moonshots don’t happen without test flights, and Kickstarter is built on relatively small successes: The majority of fully funded projects are asking for $10,000 or less. Your association may not be looking to create the kinds of artistic or tech-driven projects that are Kickstarter’s bread and butter, but the sensibility is the same—the new ideas that get over are the ones that are large enough to be meaningful, small enough to test without too much drama, and interesting enough to get a tribe of people to rally around.

First, though, you need to cultivate an environment where people feel comfortable putting those new ideas out there. For associations to be more risk-oriented, Strickler said, “it would have to start with an acceptance of change. If you don’t believe that things will change, or should change, or could change, you’ll find yourself very rigid. And when change starts to happen you will get anxious and fight it.”

Embracing change signals an ability to thinking beyond the short term. “If an organization can create an attitude like that, I would bet on their ability to make good decisions,” he said. “When you have that sort of orientation, I think it’s possible to explore what the future could look like.”

Strickler argues that the leader’s job in this environment isn’t so much to the be creator of those new ideas, but to serve as a facilitator for them. “I think every organization needs a mix of creative people and managerial, doing-things people,” he says. “Those aren’t the same person.” And Strickler returns often to the notion of success being a function of how a leader thinks about time. Thinking solely about how you’re going to get through today is its own kind of high-risk moonshot—you’re making a bet that your environment ten years from now will be the same as it is now. But that bet is a proven loser. Thinking about the future carries its own risks—nobody is perfect at predicting it. But you’ll be cultivating the kind of flexibility that will allow you to anticipate trends and adapt to them.

“The context of right now literally only lasts for this moment,” Strickler says. “It’s different tomorrow, and it’s different a week from now, and it always will be. I think having an orientation towards change should open an organization to having the possibility of making good adjustments, of evolving, of having more than one product that people are interested in. I think that’s a good thing to strive for.”

What does your organization do to cultivate small-scale risks? Share your experiences in the comments.

(erhui1979/DigitalVision Vectors/Getty Images Plus)

Mark Athitakis

By Mark Athitakis

Mark Athitakis, a contributing editor for Associations Now, has written on nonprofits, the arts, and leadership for a variety of publications. He is a coauthor of The Dumbest Moments in Business History and hopes you never qualify for the sequel. MORE

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