When to burn your ships

Hint: It's all about certainty. And gut.

In 2008 Elon Musk was betting everything on the success of SpaceX' Falcon 1 rocket launches. After 3 failures in a row, SpaceX and Elon were very close to going bankrupt.

This is an excerpt of his interview with?Scott Pelley' 60 Minutes on March 18, 2012 when he speaks about this period in his life:

[Elon Musk] "If that fourth launch hadn't worked that would have been it, we wouldn't have had the resources to mount a fifth" (rocket launch)

[Scott Pelley] "You couldn't have gone on at that point"

[Musk] "Yes, death would have been inevitable, because we did not have the resources to mount a fifth launch."

In #strategy terms, Elon Musk had burnt his and SpaceX's ships.

The story has a happy ending (so far) as SpaceX has skyrocketed (pun intended) into a multibillion dollar empire in the years ever since their 4th Falcon launch attempt which was successful.

Burning the ships is an interesting strategy concept that has been used throughout the centuries.

As a Latina, I know this term from history lessons growing up, when Hernan Cortes landed in Mexico back in 1519. Legend says that his crew wanted to go back to Spain, so he burnt their ships, so they had to stay and commit to the success of the expedition.

And while doing my research for this article, I found out that Cortes borrowed that concept from Julius Caesar, who back in 55BC allegedly said “If you want to take the island, burn the boats!” when he was trying to conquer England and his soldiers wanted to return home.

Leave it to Julius Caesar to create a strategy concept that survives for 2,079 years. ?

Burning your ships goes a step beyond "going all in" because when you burn your ships, you are betting you 1000% on that path/solution.? You are putting all of your resources and hopes in a single bet.? There is no plan B, no safety net, no diversification. It's only one choice/path only.?

This concept can and has been applied both in business and personal lives.?

When my mentees and clients I advise ask me: ?when it is a good idea to burn your ships?

My answer is: very rarely. Burning your ships works out perhaps 1 out of 100 times.

Here's why: ?to burn your ships, you have to have, above all, CERTAINTY. ?

Certainty that you are better than your competitors.?

Certainty that your user is going to prefer your product/service and be willing to pay for it at the price you are selling it.

Certainty that you are not too late in the game (and not too early either). ?

Certainty that you will not go homeless if you and your company go bankrupt.

Certainty in this #AI day and age is something that is becoming rarer and rarer.? Technology is changing extremely rapidly.? User tastes too.? The statistical long tail is becoming longer and longer.? Competitors are fierce and move fast.? Sometimes it's just even a matter of timing: the product or service might be perfect but it's too soon and your users are not ready for it.

I have seen countless startups and companies burning their ships, going into significant debt to launch something that won't work out because of a variety of reasons.? But nobody tells them that, or if they do, the leaders don't want to listen to it.?

But if you are in that 1% scenario, that magic moment of certainty, then go for it: Burn your ships, and dance around that glorious fire.

I have burnt my ships twice in my life.? The first time the result was a homerun, a tremendous success that paid off for years if not decades afterwards.? I had certainty, I felt it in?my gut.? There were zero doubts and I took the plunge and it was incredible.?

The second time, I had about 95% certainty.? I did not feel it in my gut. I had a little voice in my ear telling me that there were still some open questions. I ignored my doubts, I burnt my ships anyway and it ended up being a complete failure with a disastrous?wake on their tail that took years to recover from.

The corollary is: for certainty, you have to feel it in your gut.? Zero questions. You will absolutely know it, and you will know what I am talking about.? You will feel that certainty in your bones. It feels like some kind of a calling.

But if you still have one single doubt, then that's not certainty.? Don't burn all of your ships, burn one, and keep the second.? Diversify.? Keep a safety net.?

While listening to Elon Musk's interview, I got the sense that he had certainty, that the knew in his bones that the 4th launch was going to work, that's why he burnt his ships and took the plunge.? And it worked out in a marvelous way.

*Musk's interview link in the comments, worth 14 minutes of your time