FT : Optimism Is The Elixir That Makes Everything Possible
Wednesday, October 14, 2009
Optimism is the elixir that makes everything possible. It sparks confidence – and that fuels ambition, which in turn triggers action. It leads to new inventions, new companies, new jobs and a higher standard of living. Without this sense of hope in the future, life is a grim affair, a kind of regression back to the Dark Ages. This elemental lust for life is an amazing but intangible force; such instinct cannot be easily understood through scientific endeavour. But it can surely be either nurtured or discouraged, and it is up to us, each and every day, to decide if we want to look forward or back. Important initiatives always require a leap of faith. I tend to find that those who are overanalytical struggle with real breakthroughs. They focus so much on the downsides they forget about the potential of the sunlit uplands. When making a big investment, there will always be a moment that you approach the precipice: all the material facts are known; negotiations have exhausted everyone; now for the decision – do you take the plunge or walk away?
This week, with partners, we bought some assets out of bankruptcy. As ever in such circumstances it was a chaotic process, the due diligence and contract full of gaps and conceivable dangers. We did what homework we could. Our lawyers, as they should, warned us of the worst-case outcome. But on balance, we felt the prize was worth the possible perils, and we forged ahead. Now we have to make the acquisition work: but with bold vision and great effort, I am sure it will prove transformative. It is self-evident that emotion plays a large part in such matters. Most entrepreneurs I know love to believe they are solidly rational, especially when considering dramatic steps such as takeovers or product launches. But the truth is that when it comes to the crunch, entrepreneurs by nature allow the animal spirits to surge and tend to seize an opportunity. After all, no deal is ever a sure-fire thing – every innovation carries the chance of blunder. But for enterprising souls, the desire for gain overwhelms the fear of loss. Unquestionably, the adrenaline rush of momentous events can lead to recklessness. The economic downturn has exposed great swathes of such folly. But winners in the game of capitalism calibrate the odds before they charge, reckoning that they can cope even if it all proves a mistake. I am all for proper enquiry beforehand, and sensible hedging where practical. But never demand a certainty: if you wait for that, you will be on the sidelines for ever.
This year it has been common to feel trapped in an almost universal mood of gloom. And if it’s not doomsayer economists, it’s environmentalists filling us with despair, or a beleaguered media industry delivering tidal waves of bad news. But such depressing predictions do not allow for the relentless tide of human ingenuity, and the sheer power of positive thinking. I cannot account for it, but enthusiasm, willpower and force of personality can achieve remarkable feats. There is no room for complacency, and no one said achievement is easy – but I believe there are solutions to almost any problem. Plenty have suffered setbacks, but they will recover: short of death or prison, such reverses can always be overcome with persistence. Millions have been made redundant, lost their business or seen their investments shrink. But giving up is the ultimate tragedy. As someone once said, unless you have lost a limb and your house is on fire, your difficulties are just inconveniences. Money is only part of the answer – more often, what is needed are unbounded conviction, a sense of aspiration, and a constructive approach. Plan for failure and you will not be disappointed, but if you concentrate on your strengths and apply yourself, something heroic may emerge. Psychology has an element of self-fulfilment about it; just remember that every year spring returns, that all our troubles turn into valuable experience over time, and that the world is more forgiving than you might imagine.