My first "startup" began when I was fifteen. I was lucky that my brother, who was eleven years older and a contractor, taught me a bit about painting when I was young. When I saw professional painters working in the foster home where I lived, I told them I could do that too. After painting the third bedroom, word spread in the neighborhood, and I became a house painter.
Within six months, I was able to hire four friends for every job, and together we earned more than any of our other friends. A year later, I had an income that even made my foster parents jealous. By the time I was 21, my second startup was an advertising agency. Within four years, we worked for some of the world’s largest international brands, such as Packard Bell and Samsung, and two years later, I had my first million in the bank.
Sounds like remarkable entrepreneurship, doesn’t it? But honestly, it had little to do with that. The biggest factor in my business success was luck. And that doesn’t apply only to me. If you look at the statistics, you’ll see that luck plays a crucial role in the success of almost every entrepreneur.
Egocentric Bias: Why We Think Our Success Is Entirely Our Own Doing
When you start a business, it seems logical to give yourself all the credit for your achievements. After all, you know how many hours you’ve invested, the risks you’ve taken, and how hard you’ve worked to realize your vision. But here’s where an interesting psychological trap comes into play: egocentric bias. This phenomenon causes us to overestimate our own efforts and underestimate the role of others—or even luck.
A telling example of this is research on collaborations. When authors of scientific papers are asked what percentage of the work they contributed, the total of all responses averages 140%. This means everyone gives themselves more credit than is statistically possible.
A similar pattern is seen in households: if you ask couples how much of the household chores each of them does, the combined percentages almost always exceed 100%.
This bias isn’t necessarily rooted in arrogance but in how we process our own experiences. We are fully aware of all the work we do because we live through it and remember it. The efforts of others, or the influence of external factors like luck, are often unconsciously overlooked. This explains why people in startups tend to think their success is purely due to their perseverance or talent.
In reality, luck plays a much larger role than many are willing to admit. Think about having the right connections, unexpected opportunities, or simply being born in a country that fosters entrepreneurship. Egocentric bias can blind you to these crucial elements, distorting not only your perspective but also how you value success and help others.
The Role of Luck in Startup Success
While perseverance, innovation, and smart entrepreneurship are important pillars of building a successful startup, luck often plays the most crucial—and often underestimated—role.
Take, for example, professional ice hockey players. Research shows that 40% of players in top leagues are born in the first three months of the year, while only 10% are born in the last three months. Why?
This has to do with the cutoff date for youth hockey teams in the U.S., which is often January 1. Children born in January are typically older, bigger, and stronger than their younger teammates. This gives them more playing time, better coaching, and greater opportunities to develop their skills. This advantage compounds year after year.
This principle, also known as the Matthew Effect ("For whoever has will be given more"), also applies in the startup world. You can be incredibly talented and hardworking, but sometimes a chance encounter, an emerging market, or simply being born at the right time and place is enough to provide a decisive advantage.
Entrepreneurs in wealthy countries benefit from stable infrastructure, access to capital, and a culture that values entrepreneurship. Without these luck factors, many startups would never get off the ground.
Yet, we often fail to recognize how significant luck is. The success of a startup is frequently attributed to the founder's vision and skills, while context and chance events can be just as pivotal. By acknowledging the role of luck, we gain not only a more realistic view of success but also more gratitude and humility in entrepreneurship.
Why We Undervalue Luck in Entrepreneurship
One reason entrepreneurs often ignore the influence of luck lies in how our brains work. Luck, by definition, is something beyond our control and is therefore not actively stored in our memories.
What we do remember are the long nights, tough decisions, and creative solutions we devised. This skews our perception, causing us to overestimate our own contributions and underestimate the impact of chance events.
Consider the founder of a startup who secures a major investor. They’ll primarily remember their convincing pitch, not that the investor happened to be looking for exactly that type of business at that time.
This blind spot for luck isn’t unique to entrepreneurs. Professional athletes, businesspeople, and even politicians make the same mistake. They see themselves as the architects of their own success while forgetting the role of external factors.
This is problematic because it not only leads to a distorted self-image but also to a lack of empathy for others. Entrepreneurs who believe their success is entirely self-made are less likely to help others or acknowledge how much luck they’ve had along the way.
In the world of startups, this can result in unequal opportunities, leaving aspiring entrepreneurs with fewer resources or connections without a fair chance.
Luck doesn’t just play a role in success but also in failure. Those who attribute success solely to their own efforts may be inclined to take full responsibility for failures as well.
Luck and the Composition of Success
One of the most intriguing insights about luck is how small advantages, when compounded, can have a significant impact. Take, for example, a startup in a competitive market. The success of such a business often seems to result from brilliant strategies or unique ideas, but in reality, small, random advantages often play a decisive role. This phenomenon is known as the compounding effect: small advantages lead to greater opportunities, which in turn continue to multiply.
A clear example of this can be seen in professional sports. As mentioned earlier, hockey players born early in the year have a significant advantage because they are stronger and more physically developed than their younger teammates. This difference, however small, leads to more playing time, better coaching, and ultimately a greater chance of making it to professional leagues. Startups work similarly. Early access to an investor, an unexpected market opening, or simply meeting the right mentor can give a startup the push it needs to achieve long-term success.
This idea becomes even clearer when looking at extremely competitive selections, such as NASA astronauts. Research shows that even if luck influences only 5% of the selection process, that’s enough to replace most of the selected candidates if that factor were excluded. In a world where thousands of startups compete for limited investments, the difference between failure and success is sometimes no more than a little bit of luck.
Recognizing Luck Makes You Stronger
Ironically, ignoring luck can sometimes help entrepreneurs succeed. Many believe they are fully in control of their fate, which drives them to work harder, take more risks, and persevere. But this "useful illusion" has a downside: once success is achieved, entrepreneurs may forget how much luck was involved. This can lead to complacency and less willingness to help others or give back to the community that supported them.
Recognizing luck, however, has unexpected benefits. Research shows that people who acknowledge the role of external factors in their success are generally perceived as kinder and more generous. They are more likely to help others and show gratitude for the opportunities they’ve received.
This also applies to business: entrepreneurs who are honest about their luck are often seen as inspiring leaders and build stronger relationships with customers, investors, and colleagues.
Moreover, being aware of luck can make you happier. By recognizing that success isn’t solely your doing, you create space for humility and gratitude. This not only helps you put things into perspective but also strengthens your motivation to provide opportunities for others. A successful entrepreneur knows that luck is a big part of the story—and uses that insight to create chances for others.
10 Examples of Successful Entrepreneurs with (a Lot of) Luck
While the success of some entrepreneurs can also be attributed to their vision and insight, you could argue that their luck factor was decisive. Judge for yourself:
Steve Jobs and Steve Wozniak: The creation of Apple began with a chance meeting through a mutual friend. Without that connection, Apple might never have started.
Zoom during the COVID-19 Pandemic: Although the platform had existed for years, its success exploded due to the timely onset of the pandemic, which created massive demand for video conferencing apps.
Tesla in California: California’s policies supporting electric vehicles with subsidies played a significant role in Tesla’s early success.
YouTube: The founders initially wanted to create a video dating platform. By chance, they discovered that the technology had much broader demand, leading to the creation of the world’s largest video platform.
Post-it Notes (3M): The famous Post-it was discovered when a scientist at 3M accidentally developed an adhesive that didn’t stick well.
Velcro: The idea for Velcro came when its inventor, George de Mestral, noticed burrs (seed pods) clinging to his clothes after a walk. He examined their structure under a microscope, which sparked his inspiration.
Oprah and Dr. Phil: Dr. Phil’s career skyrocketed thanks to his numerous appearances on The Oprah Winfrey Show. Without Oprah’s platform, his success as a media personality would likely have taken much longer—or never happened.
Uber during the Economic Crisis: Uber emerged during the economic recession of 2008 when many people were seeking flexible jobs. This made it easy for the platform to find drivers eager to earn extra income.
Google: Larry Page and Sergey Brin met by chance when Brin was assigned to show Page around the university. Without that meeting, Google might never have existed.
IKEA: The company benefited from Sweden’s culture of minimalism and affordability, which made its products appealing worldwide.
I’m not saying they were successful purely because of luck, but it’s likely that without their fortunate circumstances, we might never have heard of these businesses or entrepreneurs.
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