Cohesion
What do productivity, team composition, and portfolio construction have in common with drug dosing in diabetes?
Give me a moment to explain.
A few of you may know that I’m currently finishing up my medical degree. In the course of studying for my final exams, I’ve been reading up on the treatment of Diabetes Mellitus.
Diabetes Mellitus is a chronic disease related to our blood sugar levels. A normal body produces varying levels of ‘insulin’, a hormone that lowers our blood sugar levels. This level is usually fluctuant in response to how much energy we’re consuming in our food or using in our bodies. Ideally, we maintain those blood sugar levels in a fairly even range. In diabetes, however, the cells in our pancreas that usually produce insulin die, or don’t work so well, leading to blood sugar outside the normal range. (That’s bad for a number of reasons!)
So, in order to treat diabetes, we give supplemental insulin.
Let’s dive into the method behind that.
There are a large number of ways to do this – with short, medium or long-acting insulins lasting from hours to multiple days. Short acting insulins are great, because they can be given to act super quickly in response to a meal, or a blood sugar level that is too high. But these short-acting insulins can also be dangerous! Patients need to monitor their levels to make sure they don’t drop too low. Long-acting insulins are great because they give a sustained, controlled release of insulin. That’s great for maintaining a solid baseline of insulin. But they’re not so great in response to normal daily fluctuations in blood sugar in response to meals, exercise or illness.
Often, doctors will prescribe a combination of insulins, to easily maintain blood sugar levels in a healthy range, avoiding periods of high or low blood sugar (which can be dangerous). It looks a little like the graph below.
The main point here? The most natural way to dose insulin is to use a combination of medicines, all with their own benefits and drawbacks, personalised to a patient’s own lifestyle. (These days, we also have wearable tech that can measure our blood sugar levels and dose accordingly, and even sensors for blood sugar monitoring in healthy people - but let’s stick with this concept for now).
I love this as a core concept.
The natural interaction between multiple factors, creating an ideal, cohesive treatment regime from flawed parts of a whole.
I think this concept applies to a lot of things. When we put it in the context of VC, I can see parallels between personality of founding team members, choice of investment strategies, portfolio construction, or – more broadly – core productivity behaviours.
When I think about the most productive people I know, they’re not at ‘100’ all the time, but they’re rarely at ‘0’. If we consider the short-acting insulin to be a short burst of well-timed, highly focused energy or concentration, and the baseline, long-acting insulin to be a core, steady stream of incremental progress, we create a pattern of intuitive work.
How about team composition? You need pioneers, drivers, integrators and guardians. Someone to be the risk taker, with big ideas, someone to drive the idea forward, someone to bring the team together and someone to bring order and efficiency. Singularly, each one of those personality types has flaws, and limits to their growth potential, but combined, the team becomes self-sustaining and self-healing.
And portfolio construction? Diversification within your specific mandate is a fairly well-established model to maximise upside while aiming to negate the downside of any particular one investment. This could be anything from diversification between investment verticals or sectors, choice of asset classes, or weighting of risk profiles. (I had a great chat recently with a friend in global equities about its similarities and differences to crypto investing!)
My takeaway? I’ll be looking to identify complementary upsides for flaws – in companies, yes, but also in my own patterns. With any luck, I’ll find asymmetry and a missing upside. That’s the key to demystifying blockers and finding new opportunities for growth.