Frugality, liquidity, and holding position.
“Change breaks the brittle.” ― Jan Houtema
Recent trends in the world that COVID influenced made me think deeply about the inadequacies in our communities. We are seeing people lose loved ones, many layoffs, dying/struggling businesses, broken health care systems, and travel restrictions.
COVID, in a way, surfaced all the inefficiencies in our systems – pretty much everyone had to go into complete lockdown to figure out solutions while staying afloat during this crisis.
This observation triggered my thoughts on preparedness for unanticipated incidents that have severe impacts on your life. I kept thinking about how companies, people, and other institutions with limited resources will survive this long haul without any revenue, cash flow, especially when they don’t have any reserves to stay afloat.
We all heard that we should never let a good crisis go to waste, but how can we survive or stay afloat to figure something out of this crisis without having enough liquidity at our disposal? It gets complicated when you are running a business and people rely on you.
The recent incidents made me realize that we consistently overestimate our position – in markets and personally. The truth is most of them are one or two events away from going back into hardship – one unanticipated crisis, and we have seen how the world just froze.
The realization, in a way, scared me and made me reflect on my position and how I work, which led me to think about the consequences and how one can thrive beyond a crisis. In the process, I discovered three main components that help us stay in the game.
Great things usually happen when you play a long-term game. Playing a game for a long time means you need to keep yourself ready to fight many unanticipated events – the best way to be prepared is to be frugal in life. Frugality not only prepares you for a bad day but in the event it occurs, you will know how to survive without much burn.
It would be best if you kept iterating, experimenting, and improving yourself constantly and your business to find the right timing and make it influential. Sometimes it takes years, and sometimes it takes decades — having some form of liquidity to keep it going at random times gives you the advantage of being the first and freedom to go the extra mile.
It’s getting increasingly difficult to keep up with things these days; with so many distractions, everything looks attractive, and there’s little friction to take sides. But a deal gets real only when you commit to it and play it long enough — just like any position trade.
You win the game by holding your position by committing to it without any distractions or digressions and stay long.
Find your battle, stay frugal, experiment more, hold your position and stay in the game long enough – and eventually, you’ll be right.