I love stealing the best ideas from other industries and applying them to investing. But my favorite ideas are those I hear from leaders in other sectors AND investors by accident. That’s when you know you have something special. I first read about the power of tension between two conflicting ideas on The Knowledge Project blog in a post that includes this F. Scott Fitzgerald quote: > The test of first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function. It seemed useful for investing. We hate uncertainty and we often cut short decision-making processes so that we don’t have to hold two ideas in our head. So, it is through the exploration of opposing ideas or uncertainty we come to better outcomes. I’d never thought of this insight as a company building concept. [That changed when I read Unreasonable Hospitality.](https://kevindstevens.com/2023/02/01/unreasonable-hospitality/) If you’ve asked me for a book recommendation in the last 18 months, this was my enthusiastic recommendation. The book contains a multitude of lessons on business told through the lens of Will Guidara who ran Eleven Madison Park during its run as the best restaurant in the world. One of those lessons is that excellence and hospitality are ideas that are often in conflict. To fulfill the promise of both, requires a special focus of keeping both opposing ideas top of mind. Will demanded perfection while making people feel right at home – if you’re a parent or have ever been in a house with kids you know how impossible this can be. Excellence within the fine dining community equals attention to detail. The silverware is polished by hand, the wine glasses are void of a single fingerprint, and the servers move around like a finely choreographed Broadway show. Hospitality on the other hand usually means none of these things. In fact, when we have friends over for a quiet dinner, the phrase “we don’t have to do anything special” enters the conversation and special equates to something like the scene described above. As it turns out, this concept of opposing ideas applies to more than restaurants. It works for firm building too. On my train ride yesterday a familiar idea surfaced, this time from Roelof Botha, Sequioa’s Managing Partner: > The third one, which really dawned on me much later, is > this idea of holding things in tension. So, we live in the Bay > Area. We’ve got the Golden Gate Bridge. It’s a wonderful > landmark, obviously. And as a suspension bridge, it gets > its strength from holding opposing forces in tension. And at > Sequoia, we celebrate that. > > So, we want innovation and performance. We want > individualism and teamwork. We want to be demanding > and supportive. Most organizations make a trade-off > between those dimensions. It’s one or the other. At > Sequoia, we want to do both. I’m an avid notetaker. I’ve built systems for my favorite ideas from books and podcasts to populate into my favorite notetaking app Obsidian. So, I asked myself, where have I heard this idea before – and there it was – Unreasonable Hospitality. > Multiple conflicting goals force you to innovate. – Will Guidara Over the last several years, and for much of its history, Sequoia has been known as an innovator in the asset management space. Sometimes that means they make mistakes, but more often than not they win. In the best way, they always push the boundaries of what it means to be great stewards of capital and partners to founders. Hospitality and asset management are different in a lot of ways. But, in at least two, they are very similar: 1. Creating special experiences for people spending their hard-earned money or investing their capital with you goes a long way. 2. Balancing conflicting ideas creates a special environment for innovation in a sector often devoid of it. Admittedly, I have bias now that I look for this, but the concept is everywhere. One of the big questions of climate investing is “can you be returns driven and make an impact?” The answer is of course, yes. In fact, buyers place premiums on assets where revenue comes from high-growth climate sectors. When companies ask if they should focus on profit or growth, the answer is both. If you successfully balance the two, you’ve built a durable business with an enduring market position. In a world full of content, and with AI creating even more, sourcing durable ideas creates a competitive advantage. Once you find one you like, keep your eyes and ears open, if you hear it outside your bubble, you’re likely on to something. *Related: [[Combining Opposite Traits]]*