Should You Pursue Your Dream, Even if You’ll Probably Fail?

I like to think of myself as a rational person. Yes, I have emotions that muddle my choices, and I make mistakes on logic problems just like anyone else. But when I have big decisions to make in my life, I’d like to believe that I go with the facts.

Which is why the titular question makes me so uncomfortable.

My dream was to be an entrepreneur. I wanted to run my own online business. Years later, I would achieve that dream, but the odds of success certainly weren’t on my side.

I’d often heard the statistic that “80% of new businesses go bankrupt” and I had connected with many friends also trying to do the same thing, while very few were able to earn a living from it.

My dream was a high-variance profession. That means there were a few spectacular winners, a few more mediocre successes and tons of failures. Authors, musicians, actors, athletes and architects are other high-variance professions.

The problem is that pursuing such high-risk professions is often hard to rationally justify. I’ll explain why this is so, but I’ll conclude by sharing why I think you can still have hope even if your dream is hard to achieve, and some high-variance pursuits that are well worth pursuing.

Why Could “Following Your Dream” Be Irrational?

First, I’m going to admit that this is an uncomfortable subject for me, and probably one I would have had a strong aversion to when my current life was still just a fantasy. I don’t blame you if you’d want to reject the following analysis out of hand, but I think that would be unwise.

Instead, I think it’s better to understand the logic, so you can also adjust your course of action to avoid its pitfalls. Not all risks are unintelligent, so understanding what makes some risks stupid can help you avoid those traps in your own plans.

Problem #1: We Only See Winners

The first strike against high-variance professions is that we only see successes, not failures.

I’m a perfect example of this. I’ve been able to build a successful business selling courses on learning better, in large part because I’ve built a large audience. Statistically speaking, you’re much more likely to read me than someone who does not have a large audience.

But my advice is only one half of the story. You don’t hear from the many other writers who tried to set up a blog, but failed to gather any readers. They might paint a very different picture than myself on the relative merits of blogging, but their voice is silent.

Blogging is a clear example of this effect, but it is pervasive in most high-variance fields. We see George Clooney or Liam Neeson, not the masses of actors waiting tables in LA. We see Bill Gates and Mark Zuckerberg, not the start-ups who failed after investing everything.

The idea that “losers” can’t teach us anything is both wrong and dangerous. Those who failed at a pursuit may not give us sound advice for emulating success, but they at least understand the costs of their choice. You risk seeing only what you want to see if you focus only on success stories.

A rational approach to entering a high-variance profession would be to also seek out the people who failed. Ask them what they regret from their choice, and whether there were any side-effects (good or bad) from not making their dream. Before you commit to going forward you need to find a way to either avoid, or be able to stomach, the possible worst-case scenario.

Problem #2: Economics Isn’t On Our Side

Paul Graham defends the merit of startups. Sure, most startups will be wasteful, he argues, but a few will have tremendous impact. The expected value is therefore far higher than the typical result (or the typical person you see in Silicon Valley claiming to be an entrepreneur).

A weakness with this analysis, however, is that earning $100 million doesn’t give 100x more happiness than earning $1 million. Economists describe this effect by saying that the utility curves for wealth are not linear.

This has an unfortunate effect for the happiness of those pursuing high-variance professions. You can see this if you try to calculate the expected utility (utility is a fancy term that roughly means happiness or satisfaction) for pursuing a start up.

Let’s say, hypothetically, that your startup has a 90% chance to earn $0 and a 10% chance to earn $10 million dollars. Obviously this is a simplification, but the analysis extends to the case where there are more possible outcomes. For this case, we can therefore expect to earn $1 million dollars, on average.

Now, most of us would probably say that having $1 million dollars is a pretty good deal, maybe worth a few years of effort, even if it’s not a certain bet.

Unfortunately, that calculation is misguided. A better way of calculating it is to try to average, not the money, but your satisfaction. You’d definitely prefer $10 million to $1 million dollars, but it’s unlikely that you’d prefer it 10x as much. If we followed a square-root law common for utility curves, you’d only prefer it a little more than 3x as much.

Because of this, however, our expected satisfaction is quite a bit less. In terms of satisfaction, you’re only getting about a third of the satisfaction as you would have if the $1 million were a sure thing.

Paul Graham’s analysis is certainly correct on a societal scale, which I believe was his point—startups, in general, are valuable even if most are wasteful. However, the high variance of his profession does make it somewhat less attractive for a potential new entrepreneur worried about the happiness of his future choices.

Problem #3: Our Choices Influence Happiness Less Than We Think

One reason I wanted to pursue my dream was because I was convinced how happy it would make me. In looking back, it has made me very happy, but I doubt any reality could match the fantasy picture of success many people hold for their dreams.

Unfortunately this too doesn’t square exactly with the facts. Daniel Gilbert, in his excellent book, Stumbling on Happiness, notes that we overestimate the impact choices will have on our happiness. Great wins and great failures, he argues, have a smaller impact on happiness than we would otherwise believe.

This again places a strike against high-variance professions because the possible wins in terms of life satisfaction are smaller than we might otherwise imagine. Even if you do become famous, rich or celebrated, it probably won’t shift your overall happiness too much.

This research is also comforting, in that it suggests failures are also less painful. Even if you aren’t successful, it may also have a smaller impact on your happiness than your fears might suggest.

Why Pursue High-Variance Professions?

Now I know that if I had read this article a decade ago, I would have quickly compartmentalized the idea away, if not rejecting it outright. I was committed to my pursuit, so nothing could dissuade me. I’m guessing if you’re also contemplating a risky career choice, you probably feel the same way.

Instead of risking you ignoring the message of the article entirely, therefore, I’d like to present exceptions. These are ways of working around the somewhat grim reality of high-variance pursuits, and also, perhaps, ingredients which help enable their success.

Fix #1: Choose Pursuits With a Good Plan B

If I had the choice of which aspiration I could have, I’d rather want to be a start-up entrepreneur, than an actor or athlete. The reason is that the an entrepreneur, even if unsuccessful, can often translate the experience into a pretty good job or career.

If your high-variance profession also has a decent “Plan B” then the logic presented earlier might flip. I know many people who deflected their mediocre results at an entrepreneurial venture into a career than now gives them a lot of satisfaction and happiness. Their “Plan A” may have been risky, but the average potential of all possibilities was still quite high.

Fix #2: Choose Pursuits With Low Costs

High-variance pursuits can often still be valuable if the costs to pursue them are lower. I was able to set up my business with little investment cost while working part-time, so the costs were incredibly low. That meant even if failure was likely, the worst-case scenario wasn’t too bad. Since an exact expected value calculation is usually impossible, knowing that you can live with the worst-case should make it easier to go forward.

Chris Guillebeau’s recent book, The $100 Startup exemplifies this attitude, encouraging entrepreneurship not just with vague motivational slogans but by fundamentally changing the cost structure.

Fix #3: Enjoy the Process

The biggest tipping point for myself in pursuing a high-variance profession was that it was something I really enjoyed doing. If you’re passionate about the pursuit and the process (not just the result) then most of the arguments I laid out earlier fall apart.

I started this business because I enjoyed writing, marketing and trying to figure out how people think. I started my MIT Challenge because I wanted to learn computer science, whether people acknowledged it or found it interesting was a secondary concern.

It’s in this, that I believe the real lesson comes when pursuing your dreams. If you don’t enjoy the process deeply, then it becomes something very hard to justify. But if you do, then maybe the odds of success don’t matter quite so much.

  • Hicaro

    Hi Scott. I had been reading your blog since a long time. Your topics are fairly appealing to me because they are most correlated with my current ideas about life. Before my statements about this post, I have a request. Do you know about Myers-Briggs Type Personality Indicator? I’m really curious about yours but actually reluctant about ask. It’s a very precise personality type test, you can confer the feedback of people in Youtube. Have your time, you don’t need to take it if you want not to (sorry for my poor english). Now, I guess you are INTJ or INTP. Translating them: I (introverted) N (iNtuitive) T (Thinking) P (Perceptive) or J (Judgement).

    There is a quote (I gave up my search of the author) which says: “Shoot for the moon. Even if you miss, you’ll land among the stars”. Of course, this metaphor is vague because it condense a lot of knowledge that ease its effect. However, I sense sort of conflict when you ask: “Should You Pursue Your Dream, Even if You’ll Probably Fail?”. Why that? Perhaps, it is because when you talk about dream you are not talking about emotional content (thanks Bruce Lee). But rational decision. Then your choices become a chess board. In other words, you are not necessarily trying to satisfy a personal goal, but a career goal. Probably I’m wrong, but when I read your text I see this border between your desire to become an entrepreneur and your planning to actually accomplish what you understand about entrepreneurship. Entrepreneurship is not about success. It’s a state of mind. It’s about be daring and persevere. It requires willpower. Guts. Self confidence. Even stubbornness. But you are the strategic one. Reason, precision and order conduct you. That’s the impression I have of you. Eventually, I can be completely wrong.

    I want to show you a TED Video Scott. I don’t know if I can put links in the comments, it is up to you delete or not.
    Jane McGonigal: The game that can give you 10 extra years of life:

    What this video has to do with the main question? Perhaps, with the topic “Be Irrational”. I don’t think you are a gamer, right? Well, I didn’t read all of your blogposts, but I didn’t find articles about games here. Gamers usually talks about games, sometimes. I understand that the focus of the blog is to get more from life. But this is so vague as the quote I had mentioned, right? This is only an observation. We have to be generics in descriptions, of course. Now, what what kinds of projects do you have interest? That’s when focus come in hand. People usually choose something what they are passionate about. Boring cliché, but so true. Even obsession can be a good thing when a person want to create something. What do you want to create?

    Truth be told. I am only a student. In my opinion, you are smarter than me. I know this because I read what you wrote. However, I was wondering what you will do after MIT Challenge which was very impressive.

    Sorry if i offended you in some way, I just want to understand a little bit of your choices about entrepreneurship. Perhaps, I can get some insights. It’s funny because I wrote yesterday a post in my blog about my dream. If you want to read it, feel free: (no, I’m not trying to promote myself. Anyway, my blog sucks. But I won’t send you an email to ask that. This post was convenient to me)

  • Brett Warner

    I think when you’re talking about working towards any goal you have to choose one that you’re doing for the enjoyment of the task. Most of the successful people I know became that way not by taking some major risk with all of their finances but by moonlighting and at the most losing a bit of sleep.

    If my latest project doesn’t earn me a dime I wouldn’t really even care, I was building it for me and I’ve structured my life in a way that my financial future doesn’t depend on my latest gamble or next project.

  • Mahad

    Very good post!

    People do indeed overestimate the impact success has on happiness. There are many times I have said that If I get this and that I will be happy, but nothing happened.

    I do believe that it is the progress or growth in whatever you do that contributes to the happiness. Not the end results.

  • Clay

    Great advice! I would defend the idea of pursuing your dream even if it sounds like a very complex and unreachable path, because not trying is the only way to actually give reason to pessimism and to fail for sure. But as you said, it has to be balanced with good B-plans and ways to minimize the drawbacks of risk-taking. Thank you for sharing!

  • Sameer

    Great post as usual. I’d like to make a suggestion related to the sites usability. Please make the links in the Archives section reflect the visited links in a different color as this makes it far easier to locate the articles I’ve read. As your archive holds a large number of posts, it will make it easier for us to find unread articles.

  • Shrutarshi Basu

    Scott, it seems like you’re conflating a number of very different things and I find your reasoning hard to follow. Firstly, this article does not seem to be about following your dreams, it’s more about following a high-variance career. Many peoples’ dreams have nothing to do high variance careers. My own dreams, in fact, explicitly exclude a high variance career.

    Secondly, I’m still not sure why you’re pursuing this career in the first place. At various points you say it’s for “happiness”, but you present a lot of economic arguments too. I can’t tell if this career is a means to an end, or an end in itself. Which is it? If it is an end in itself, then applying rationality to it is largely futile, our values and goals are not always amenable to rational analysis. If it’s a means, then what is the end and are there various ways to achieve it? Of those ways, which one will help you get to the goal faster and more reliably?

    If you’ve already decided ultimate goal is to be an entrepreneur then you should apply rationality to achieving success as an entrepreneur. Most startups fail because they have terrible products, shoddy execution, no business plan and little understanding of markets and customer potential. The fact that there are successful entrepreneurs is an existence proof that successful entrepreneurship is possible. Many people choose to be entrepreneurs because they believe it will bring them financial freedom and independence faster than a normal. Unfortunately, that is rarely the case. If your goal is actually financial freedom, it’s a better idea to get a high paying regular job and life a modest lifestyle than to bet the farm on a startup. It’s more worthwhile to study the career you’ve chosen and maximize your chances of success (which you seem to have done) rather than spend time rationalizing your choice.

    I suggest to read the website Less Wrong to get a better idea of how human value systems work and how to apply rationality on both a long term and day-to-day basis.

  • Adam Isom

    Dear Shrutarshi,

    This may be corny but on Scott’s behalf I would like to make the following two points:

    1) Scott is assuming there are at least two common reasons to pursue entrepreneurship, happiness/passion and fantastic riches. He is warning that doing it for the prospect of fantastic riches is not smart because of the not-obvious way in which money!=utility. And he then concludes by noting that if you enjoy the process – if your reason is mainly passion or enjoyment – it’s probably worth it (assuming it’s also cheap to fail and assuming you could learn valuable Plan-B skills).

    2) I think it’s entirely obvious that he reads LessWrong, both in (a) his distinction between money and utility, and (b) his extended remarks exhorting the reader not to flinch away from the message, as he might have done when starting.

    Let’s loosen up on the critiques, buddy, and consider the opposite, or consider reasons why this intelligent and successful blogger might be fairly rational 😉

  • Shrutarshi Basu

    Hi Adam,

    Thanks for the summary. It makes things clearer, I just had some trouble following the flow through the article. I think it’s possible that Scott already reads Less Wrong, it’s just my standard advice to help people who I think could benefit from it. Given that Scott has mentioned he’s studied economics and business, I thought that’s where he picked up his notions of utility and money and I decided to recommend Less Wrong anyways. My criticism was meant to be constructive: I try to help people make their arguments clearer and sharper as much as I can. I’m sure that Scott is quite rational and thinks things through clearly, I just think that this article could have been clearer on the points I mentioned.

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  • Adrienne Tran

    I’d push back on a lot of the things in this post, particularly the assumptions (if we are striving for truth; I think the logic flowed fine).

    The post assumes that we pursue dreams for two reasons: a) money, and/or b) happiness, and then goes on to assert that there are many biases which create problems along the way to pursuing our end goals of money and/or happiness.

    Pursuing dreams is not about money or happiness (happiness is easy — it’s all a matter of expectations, and a state of mind). Pursuing a dream is about having a vision, and in that vision is usually intertwined some injustice, some gap that is missing.

    When Peter Thiel started Paypal, it wasn’t primarily so he could make a lot of money or be happy, it was fundamentally about his vision of the future not being run by politics. Paypal was founded on principles of libertarianism – creation of a currency that was free from government control, ultimately forcing change on existing socio-political order.

    Ultimately, pursuing a dream means having a strong belief that there is some injustice in the world and a conviction to make it right.

  • Rohit Gupta

    You’re apt that we should have alternative plan in place when pursuing high-variance professions. What I’ve observed, there needs to be a fine balance of risk-taking and cautiousness to make it worthwhile.
    And if the skills you earn are largely transferable, it makes the whole effort all the less risky!

  • nick

    Neuroscience seems to rule out rationality as the driver for most of our choices (well, currently, but you know how messy science and the brain is). Your brain has already sent the signals to move your muscles before the thought enters your consciousness (tested via MRI I believe).

    Also, in studies of entrepreneurs, they seem to not be risk adverse because they lack the ability to believe they can fail (I think this only referred to real-deal entrepreneurs, the kind who just go do stuff, vs. the people who decide they want to try being entrepreneurial).

    Of course, take this with a grain of salt and fact-check me with actual studies before you take me too seriously. :)

    Also, I don’t mean that you can’t act and plan rationally – but your brain is exemplary at fooling you into thinking you are even when you’re not. Stupid neurochemicals.

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  • Luis

    It is a complicated matter. Following your dreams can require a lot of work depending on what you want. I think it comes down on how much are you willing to give of yourself to fulfill your dreams. Here is another article on the subject to anyone interested: Common mistakes when pursuing dreams .