What Determines Portfolio Outcomes More Than Strategy?
John Paul Getty's maxim for success was "Rise early, work hard, and strike oil". This session is about maximising your chances of striking oil!
As he discusses in this BBC interview, you have to have good luck and avoid ruinous bad luck as well as having the skills and putting in the work.
Ergodic investing and entrepreneurship is a specific approach to that maximises the likelihood of good luck and minimises the risk of ruinous bad luck for both investors and entrepreneurs.
Compare this with portfolios, which do a mediocre job for investors and no good for entrepreneurs.
More details:
A normal fund can be an ergodic strategy for LPs because investors pool capital into a fund. But for the investee companies, “there is zero benefit” unless something changes the capital dynamics of the companies themselves — for example, some form of profit or capital pooling between them.
The problem is not only that “1 in 12 startups succeed.”
The deeper problem is that many startups that could have succeeded die because they experience the wrong sequence of events: delayed funding, a bad hire, customer churn, a market shock, a failed product iteration, a missed revenue month, or a fundraising winter.
In non-ergodic systems, the order matters. A venture can be fundamentally promising and still die before its upside has time to arrive.
So for venture builders and operators the questions become:
How do you reduce the number of companies that die from path dependency before their real potential can compound?
A venture studio for example may make companies better, faster, and cheaper to build. But if each company still faces ruin alone, the portfolio remains structurally non-ergodic. Do studios, portco's and operators change the survival dynamics of the companies, or do they merely improve their individual execution?
This is where ergodic ecosystem design becomes useful.
Profit pooling only works when there is profit or surplus to pool. So the first task is to help more ventures survive long enough to create upside in the first place — through shared capacity, better capital timing, coordinated governance, shared infrastructure, and stronger support between companies.
Once surplus exists, a fraction of that upside can circulate back into the ecosystem to preserve capacity, absorb shocks, and help promising ventures survive unlucky sequences.
During this session, Graham Boyd will use live simulations to compare how different portfolio structures behave under volatility — from isolated startups, to studio-supported ventures, to stronger ecosystems where shared governance, shared capacity, and eventually profit pooling change the survival dynamics of the whole system.