The negative reaction to Elon Musk’s Hyperloop plans is no surprise to me. Pundits love to tell you why things won’t work. This is how they sell the advertising,
And sure, it sounds ridiculous, a 30 minute tube ride from LA to San Francisco or whatever. I’m sure if you would have told someone living in the late 19th century that their grandchildren would fly from NYC to Paris for their honeymoon, they would have thought you were crazy too.
People have a hard time imagining the future and that’s just human nature I guess.
Anyway, the negativity reminded me of this post from Fred Wilson who, for those who don’t know, has been an astute investor in early stage companies for the past 20 years. Think Twitter, Tumblr, Zynga and Mercado Libre just to name a few…
In his piece from earlier this year titled Return and Ridicule, Fred wrote,
I have found that return and ridicule are highly correlated over the years. We have made more money on things that were highly ridiculed than on any other cohort. When I see people laughing at ideas and companies we have backed, I smile. It means we are going to make a lot of money on that investment.
I saw Bill Gurley say that you can only make money by being right about something that most people think is wrong. His logic was that you can’t make money by being wrong. And you can’t make money by being right about something everyone else knows. So you have to be right about something that most people think is wrong. I really like that framework.
So I get really excited about the Hyperloop when I hear all of these reasons why it can’t work.