Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries

by Safi Bahcall

The most important breakthroughs come from loonshots, widely dismissed ideas whose champions are often written off as crazy. 2. Large groups of people are needed to translate those breakthroughs into technologies that win wars, products that save lives, or strategies that change industries. 3. Applying the science of phase transitions to the behavior of teams, companies, or any group with a mission provides practical rules for nurturing loonshots faster and better.

“When asked what it takes to win a Nobel Prize, Crick said, ‘Oh it’s very simple. My secret had been I know what to ignore.’”

Systems snap when the tide turns in a microscopic tug-of-war. Binding forces try to lock water molecules into rigid formation. Entropy, the tendency of systems to become more disordered, encourages those molecules to roam. As temperature decreases, binding forces get stronger and entropy forces get weaker. When the strengths of those two forces cross, the system snaps. Water freezes. All phase transitions are the result of two competing forces, like the tug-of-war between binding and entropy in water. When people organize into a team, a company, or any kind of group with a mission they also create two competing forces—two forms of incentives. We can think of the two competing incentives, loosely, as stake and rank. When groups are small, for example, everyone’s stake in the outcome of the group project is high. At a small biotech, if the drug works, everyone will be a hero and a millionaire. If it fails, everyone will be looking for a job. The perks of rank—job titles or the increase in salary from being promoted—are small compared to those high stakes.

In the high-stakes competition between weapons and counterweapons, the weak link was not the supply of new ideas. It was the transfer of those ideas to the field.

In other words, the breakthroughs that change our world are born from the marriage of genius and serendipity.

The first two rules are the ones mentioned above, the key to life at 32 Fahrenheit: separate the phases (the groups working on loonshots and on franchises) and create dynamic equilibrium (ensure that projects and feedback travel easily between the two groups). Break apart while staying connected.

People responsible for developing high-risk, early-stage ideas (call them “artists”) need to be sheltered from the “soldiers” responsible for the already-successful, steady-growth part of an organization.

Teams with an outcome mindset, level 1, analyze why a project or strategy failed. The storyline was too predictable. The product did not stand out enough from competitors’ products. The drug candidate’s data package was too weak. Those teams commit to working harder on storyline or unique product features or a better data package in the future. Teams with a system mindset, level 2, probe the decision-making process behind a failure. How did we arrive at that decision? Should a different mix of people be involved, or involved in a different way? Should we change how we analyze opportunities before making similar decisions in the future? How do the incentives we have in place affect our decision-making? Should those be changed? System mindset means carefully examining the quality of decisions, not just the quality of outcomes. A failed outcome, for example, does not necessarily mean the decision or decision process behind it was bad. There

The team’s solution had been to launch a network with a creative reward system. A total pot of $4,000 would be assigned to each balloon. If Susan spotted a red balloon and reported it on the MIT team website, she would win half the pot: $2,000. If Greg was the one who told Susan about the game, he would win half of the remaining pot: $1,000. If Karen was the one who told Greg about it, she would win half of the remainder: $500. And so on, so that everyone in the reporting chain would get a cut (any money left over from the $4,000 when the chain ended would be donated to charity). The brilliance of the system was that even people who never left their home and couldn’t possibly spot a balloon had a reason to pitch in and help MIT win. The links were all tracked through the team’s website (built in two days). Mostly, the balloon hunters reached out to local friends. But occasionally they reached out to connections far away. In other words, it was a small-world network: six degrees of red balloons. The team recruited 4,400 people in just 36 hours. The second-place team, from Georgia Tech, had a three-week head start, and worked feverishly, “fueled by donuts, pizza, and adrenaline,” to set up a Facebook page and a Google Voice number in addition to a search-rank-optimized website. Yet they only managed to recruit 1,400 people. The Georgia team had bet on altruism. If the team won, they had promised, they would donate all their proceeds to charity.