The Tortoise and the Hare is one of the memorable Aesop’s Fables, the story of a hare who ridicules a slow-moving tortoise. Tired of the hare’s boastful behaviour, the tortoise challenges him to a race. ‘Look at me!’ said the hare to the other animals, ‘Just look how fast I can run’, he boasts. The hare certainly was very fast and knew it. So when the tortoise agreed to race him, the other animals did not think the poor tortoise stood a chance.
The hare soon leaves the tortoise behind and, confident of winning, looks back to see that the tortoise is so far behind him, he decides to rest under a tree, falling asleep. He is later awakened by the cheers of the other woodland creatures as the tortoise crosses the finishing line, realising that he’d slept too long and allowed the tortoise to pass him. His competitor, crawling slowly but steadily, has arrived before him.
But would that ever happen in real life? Could a tortoise really beat a hare in a race? And what if the race were a metaphor for a business startup, what’s the best tactic – steady progress or go-for-it sprint?
First, we need to consider what kind of race it is. Different races have very different requirements and competitors. If we break it down into three races, all might have quite different results.
Firstly, in a sprint, given that it can reach speeds of 60km/h, the hare would win hands down. Secondly, if it was an endurance race, it might be more even. Tortoises have the ability to persevere through harsh conditions over long distances. However, the same goes for some hares who are also well adapted to extreme conditions.
Onto the third race, and it’s one that the tortoise comes out ahead. It’s the evolutionary race. Hares have only been around for 40 million years, whereas tortoises for 200 million years. Couple this with their long lifespan, and the tortoise certainly comes out ahead.
But there is another factor we could consider: the distance travelled over a lifetime. Given its long lifespan, would the tortoise travel further? If we consider that a giant tortoise might travel 120km in one year, over say a lifespan of 100 years, they would travel 12,000 km. A hare would smash that in only one year if they were running at their top speed for three hours of each day. That would come out at 65,000km a year, but anybody who has spent time outside knows that hares spend most of their time running in circles.
In the simplest terms, no metaphors, the tortoise would win if it depends on how long the race is. If the race was over an hour the tortoise doesn’t have any chance, but over its long lifetime, my money is on the tortoise. Clearly it’s difficult to compare the two animals like for like when you consider all the variables such as age, lifespan and range, the answer is more complicated than one winner alone, but the biological evidence suggests there is some truth to Aesop’s fable: slow and steady – over a long lifetime – certainly can win a race.
So, back to the business analogy, pity the tortoise in the C21st. Stolid, careful, slowly-but-surely, the ways of the tortoise seem quaint in the face of an onslaught of hares running amok, creating new businesses or disrupting old ones. The tortoise is the old business model, cautious and slow to react, whereas the hare is the epitome of the entrepreneur, dashing around, energised. But remember, in the classic Aesop’s fable it is the plodding tortoise, and not the speedy hare, that crossed the finish line first.
The moral of the fable is the proverbial slow and steady wins the race. Such basic and wise words, but many times we find ourselves living as the hare rather than the tortoise. We define goals for ourselves, become excited, pursue them with fervour, and, all too often, get distracted and put them to one side. The story teaches us the virtue of setting and maintaining a pace to achieve our goals.
How do we stay on track? How do we balance the pursuit of our dreams between speeding away and burning out like the hare and plodding along like the tortoise, afraid we won’t ever get there? I think we all know deep down the tortoise is, undoubtedly the winner of the race, but the hare has its place, too. The fundamental task in achieving our goals is breaking them down into many smaller goals and assigning ‘tortoise’ or ‘hare’ characteristics to them.
The tortoise represents our overall, long-term startup goals and the planning that is required to achieve them. These are not goals that can be completed tomorrow. You must set a pace for yourself to reach these landmarks by breaking them down into smaller, more easily attainable goals. It is through this slow and calculated process that you will build the framework that will guide your decisions towards the end result
We know, certainly, that we can’t sustain ourselves trying to sprint our way to a finish line that could be years away, so where does the hare and his hyperactive tendencies come into play for us? Well, since we took our time when we started off and carefully pieced together an outline that breaks down our goals into bite size pieces, we can now pursue each of them, one by one, with lightning pace.
The tortoise teaches us that a slow, methodical pace is what will efficiently take us long distances. The hare teaches us that quickness is useful for short durations and bursts of activity when needed. Be it big or small, make it a point to take one step forward every day. Here are a few lessons I learned from this popular fable.
Lesson #1: Sometime we take too long to make decisions The hare did not think out his plan clearly, but he acted when he saw his opportunity. The lesson learned is though he probably had many failures, he learned a valuable lesson that would take him through life. Then again, you can’t get anywhere if you’re still sitting at the starting line when others are pushing forward.
Lesson #2: It’s ok to make mistakes, they only make you more aware The hare learned to be more persistent and that being the fastest does not always equate to being the winner. Persistence always wins as it helps you to build muscle and gives you a steely determination and focus.
Lesson #3: Competition is not always between you and someone else As we saw for the hare, his only competitor was really himself and his own thinking. Our limited beliefs, his being ‘I am the fastest so I can lie around and take a nap’, was his downfall. Some of us think this way as well, I am the best, strongest, etc. So I don’t really need to learn more, do more or expend extra energy to accomplish the next task. Complacency, as we see in the tale, leads to failure.
Lesson #4: Slow and steady really does win the race The tortoise was a perfect example of this, even in the face of sure defeat he persisted. He kept going and never ever looked back. Persistence will take your further than worry, boasting, or fear any day. You already won it in your mind! That’s where it all begins.
Lesson # 5: Don’t worry about the startup next to you, just run your own race. There’s no denying the need for speed. Start-ups spend more time on pivots than ever before, but the devaluation of experience has gone so far that wisdom has fallen out of the very definition of business intelligence Of course, experience may not bring speed, but it does bring a greater ability to reflect and put into perspective what is happening around you.
In fact, your skill set is exactly what inexperienced entrepreneurs need, yet so often don’t value. The youthful hare may talk a good game, but my money’s on the tortoise. Of course, startups are all about growth, but speed isn’t necessarily the only virtue to consider. What are the true growth metrics you should look to tag?
Most startups include their growth metrics either when pitching or updating investors, e.g., “X% growth week over week”; “Y% growth month over month”. Some of the stats are easy to interpret – you don’t need to do the math to understand 50% monthly growth over a sustained period is pretty good. But for other statements of growth, it’s less obvious to me. That is, I can’t immediately intuit if 10% monthly growth is ‘good’ and what does that mean, and obviously this depends on industry – 10% monthly growth for a mobile app may be not so good whereas for an enterprise software company, it might be healthy and borderline explosive.
I like to use Paul Graham’s metric, the ‘rule of 72’, to think about growth. The idea is that if you are growing X% over one period and you sustain that growth, then you will double your size in 72/X time periods.
As an example, let’s say a startup says they’re growing 12% month-on- month in users. Using the ‘rule of 72’, they will double in users in six months (i.e., 72/12), and quadruple users in 12 months, and so on. This works for any time period. So if an early startup says they’re growing at 12% weekly, then they should be doubling their growth in six weeks. This obviously works for any metric – revenue, users, traffic, etc.
Like all simple calculations, this is a rough approximation and has many caveats. This is just a rough estimate – that is, in my examples above I think the real answer is 6.12 months, and this estimate becomes less accurate as the growth rate gets higher. For example, 72% growth in one month doesn’t mean you will double your growth in one month. You’d need to grow 100%.
This also assumes that the growth rate will be constant over time. This is the biggest caveat since it doesn’t reflect probably about 99% of real-world examples. The thing about startup growth rate is that it’s inherently unsustainable. Sure, your bottom line will keep growing, but as your revenue continues to increase, your growth rate will inevitably diminish.
So if the success of your startup is measured by your growth rate, how do you know if you’re growing fast enough? It’s back to the tortoise and the hare again, what is the race being run? Startups today are growing faster than they have in the past. US VC backed startups in 1998 grew revenue 63% p.a on average. In 2015, the median startup grew at 85% CAGR before going IPO.
These increasing growth rates are fuelled by three key trends. First, the acquisition channels startups use to acquire customers make more potential customers and enable far more cost effective marketing than twenty years ago. Second, purchasers of products, both consumers and enterprises, are much more inclined to purchase products from startups than ever before. Third, the private equity investors are willing to invest in high-growth startups despite the greater losses sustained during most rapid growth.
As a consequence of these three trends, startups are able to grow faster than ever before, and we are seeing new records set each year resulting in the phenomenon of the unicorn.
Whatever your pace of growth, short or medium term objectives, the lessons from the race run between the tortoise and the hare offer real learnings around focus, decision making, tactics and how complacency can undermine you. However, the real message for your startup business is that in reality, it’s not a competition with another business that matters, rather it’s a competition with yourself.