Why Losing Matters More Than Winning

by Jason Ogden | Mar 7, 2017

Let me ask you a question. I want you to be honest with yourself. Which has a greater impact on you: a win or a loss?

After a big game, are you happier when your team wins or are you more dejected when they lose? Which outcome has the greater impact on you personally? What about your business?

Determining winning in sports is easy; in business, it’s a bit more difficult. Of course, there are the quantifiable parts (i.e. sales and your bottom line), but there are also unquantifiable parts like losing a key person or account, deciding to say no to an opportunity, figuring out you have flaws in delivery, etc. Sometimes, you’ll have to make peace with your interpretation of winning or losing because it’s not always clear.

Not much good can really come from losing — financially, emotionally, or otherwise. Let’s do a simple math exercise to prove this:

Assume you invest $100. Today the investment loses 50% of its value, leaving your investment worth $50. Tomorrow, your investment rebounds in extraordinary fashion and gains back the same 50% that it lost today, leaving you with $75. Wait, what? I lost $25 on that lose/win swing; shouldn’t it have evened out? Nope. That’s why losing sucks. This phenomenon works for any percent gain/loss (regardless of whether you gain or lose first), but the negative impact grows as the percentages increase.  

Losing has more of an impact on your business than winning does.

If you agree, then I want to challenge you to do one thing: give proper weight to the impact of a loss when you’re making decisions — whether it’s quantifiable or not. Dig deep into the downside of any decision before you make it.

I’m not saying don’t take risks — quite the contrary. I’m saying take lots of calculated risks that put you in the position to win a whole lot more than you lose. Losing will continue to suck, but if you can cut down on it even a little, it will make a big impact on your business.