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Groups Never Admit Failure


2m read
·Nov 3, 2024

Groups never admit failure. A group would rather keep living in a mythology of "we were oppressed" than ever admit failure. Individuals are the only ones who admit failure. Even individuals don't like to admit failure, but eventually, they can be forced to. A group will never admit they were wrong; a group will never admit, "we made a mistake," because a group that tries to change its mind falls apart.

So, I'm hard pressed in history to find examples of large groups where they've said, "we thought A, but the answer is actually B." Usually, what happens in that case is a schism, where you go from the Catholic Church to Protestant and so on. There's a divergence and usually a lot of infighting. This happens in crypto land too, where the coins fork. Bitcoin doesn't suddenly say, "we should have had smart contracts," or ETH doesn't suddenly say, "we should have been immutable."

I was on the board of a foundation that was charged with giving out money for a cause, and I found it very disillusioning because what I learned was that no matter what the foundation did, they would declare victory. They would give money for a certain thing; they would support a certain project, and every project was victorious. Every project was a success. There was a lot of back slapping, a lot of high-sounding mission statements and vision statements, a lot of congratulations, a lot of nice dinners, but nothing ever got done.

What I realized was because there is no objective feedback, because there is no loss, it's all social profit. They couldn't fail, and because they couldn't fail, they misdirected resources all day long. Eventually, of course, such groups run on money. If you want to change the world to a better place, the best way to do it is as a for-profit because for-profits have to take feedback from reality.

Ironically, for-profit entities are more sustainable than non-profit entities. They're self-sustainable. You're not out there with a begging bowl all the time, and of course, you lose the beautiful non-profit status; you have to pay your taxes. You can also get corrupted by being purely for-profit. But I would argue that the best businesses are the ones that, long-term, are both for-profit, sustainable, and ethical.

So you can attract the best people, you can sustain it because it's a mission. It's not just about the money because it's diminishing returns to making money. There's diminishing marginal utility and money in your life. So I learned that if you want to change the world, you're probably better off trying to do it with a for-profit.

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