Charlie would invert.

One way to play Snakes and Ladders is to try to maximize catching ladders and minimizing encountering snakes. Charlie would say “All I want to know is where I am going to die, so that I don’t go there”. So Charlie would play in such a way to reduce the probability of meeting snakes to a minimum. Charlie would say: it’s okay if you don’t catch any ladders provided you can avoid all the snakes, you will still win.

So Charlie’s strategy was to not be smart; it was to avoid stupidity like avoiding the snakes. In the world of business and investing, it would mean avoiding all the pitfalls instead of finding the brilliant investment.

This sounds simple. Way too simple. Everybody knows it but very few follow it.

I’ll give you an example. Take the case of the telecom company- Vodafone Idea. This company is bleeding money. In February2019, I wrote a blog on it. At that time, I asked the Chairman to quit the business. Instead, they have poured Billions of Dollars since then and yet it is bleeding. It’s a difficult and competitive business.

Charlie would take one look at this company and probably say: this is a difficult business to be in. I’d rather be in simple, boring but profitable businesses. Investing in Vodafone Idea is like trying to dodge snakes after encountering them. No, thank you.

Obviously not everybody thinks this way. (See below)

Investing is as much about making money as it is about avoiding losing money. And Charlie taught me that focus on not losing and the upside will take care of itself.

I have a friend Shankar who played Table Tennis the way Charlie would invest. Shankar’s strategy of playing was what we called toku-toku. That is, he would just focus on returning the shot. There was neither spin nor swing. Just a simple return. There were better and flashier players than Shankar. But they lacked Shankar’s persistence and sooner they would lose patience and try to smash one. Most of those attempts adding to Shankar’s tally helping Shankar win more matches than those better players.

Next time, you are contemplating what to do, try inverting and ask what downsides you’d like to avoid. If you have a presentation to make, think of ways in which it can be a disaster. And here are some ways I can think of screwing up a presentation, based on first hand experience :):

• Mismatch between audience’s expectations and your presentations
• Boring/ non engaging content
• Inadequate preparation

So if you could go about avoiding each of these, you reduce the probability of downside. And the upside can take care of itself.