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Hi this is A.J. and welcome to this month’s lesson. It’s quite an interesting topic, and this topic was inspired by a book that I read. The title of the book is Antifragile, which is also the name of our topic.

Let’s talk about the meaning of that little word or phrase first, and then I’ll go into teaching you about this mentality, this strategy, why it’s important, how to use it and how to develop it. First let’s just talk about the words. Fragile means breakable, easy to break. A glass is fragile. If you drop it on the ground, it breaks.

Antifragile is the opposite of fragile. It’s the idea of super tough. It’s more powerful than nonfragile. If we said non-fragile, it means that it’s not breakable – for example maybe a plastic cup.

If you drop a plastic cup, it will bounce but it won’t break. Antifragile is really a new word that this guy created and I’m not even sure that you can find it in the dictionary.

The idea of antifragile is if you dropped the glass and it hit the ground and then it actually got stronger. That’s antifragile. It means that crisis or adversity or disasters actually make you stronger. You don’t just survive them. You get better because of them. It means you’re resistant to shock.

If there’s a shock in the environment, most people will suffer. Most people will break but you actually get stronger. You not only survive, but you actually get better so that afterwards you’re now in a better position. You’re more successful. You’re stronger. That’s the concept of antifragile.

You can find the book Antifragile on Amazon. This guy talks about and studied scientifically certain areas of life where you see this phenomenon. In biology you see it in some areas. For example, usually in biology in a population of bacteria or animals or people, if there’s a big shock like a disease or something, most people die and then the population is now weaker.

Sometimes in some situations what you see is that there’s a disaster and they resist it, most of them don’t die and then because they’re exposed to this disease or this shock, somehow they adapt. They change inside and then they actually get stronger, so then when it’s done they’re tougher. If another disease comes, they’re not even affected at all. They actually get better because of it. That’s the idea.

He also studies economics and finance and business. For example, in an economic shock – which we’ve been having a lot of and probably will continue to – in an economic crisis most companies go down. Many companies fail completely but a few of them actually get stronger and become more successful. They actually use the crisis to improve and achieve more and grow. It’s interesting.

Of course, he studied psychology and emotions because ultimately that’s what we’re interested in most, I think. Again there are certain people who will take emotional shocks and things in their life that are very hard and tough, and yes they’ll feel pain and suffering for a while but after a period of time – not very long – they actually end up happier, healthier and emotionally stronger as a result.

It’s kind of like the idea of resilient. There’s this word resilient in English that means you can resist challenges or problems or harm. Antifragile is like one step above that where you actually take the harmful thing and use it to become more powerful, whereas most people when this harmful thing affects them they get weaker, but you use it to get stronger.

There are a few principles to think about and we can apply these personally, emotionally and psychologically. You can apply them in business. You can apply them in other areas of your life as well, using these principles to become more antifragile.

Let’s talk about this. The first thing I would like to do is use a business example because I think it illustrates the point fairly clearly and simply. Let’s think about the music business. Let’s imagine basically two kinds of businesses in the music business.

One will be a big record company, a huge multinational company with billions of dollars coming in. They’re selling all kinds of records of every different type all over the world. It’s a big powerful rich company.

Now on the other hand, let’s imagine just one band of rock stars. Let’s say Radiohead. I like them, so let’s just imagine Radiohead. It’s just one band. I think they have five or six people in their band. It’s very small. They’re selling a good amount of records. They’re still rich. I mean I think all of us would be happy to have their money, but they’re not billionaires. They’re not selling billions and billions like the record company.

They’re both businesses though. Let’s look at which one is antifragile. It turns out that it’s the rock stars that are antifragile. In fact, the big company is much more fragile. What we’ve seen in the record industry with MP3s and iTunes and these big changes throughout the record industry is that these big massive record companies have suffered a lot.

They’ve lost a lot of money. Some of them have completely ended. They’ve gone broke or bankrupt. Others are struggling and fighting and they can’t figure out how to adapt to all these changes, so there are these big shocks in the music industry. There are all of these changes with piracy and MP3s and iTunes. It’s just totally different than when they used to sell physical records and physical CDs.

This has really hurt a lot of the record companies. Many of them are failing, will fail or have failed already. On the other hand, the band Radiohead is doing phenomenally well. As all of these changes and these big shocks in the music industry have happened, they’ve actually gotten stronger and more popular. They’ve not only survived it but they’re thriving. They’re doing really, really well while these massive big record companies are struggling.

Why? What’s the difference? Why does this one seem to be so much more adaptable? It’s because of certain properties of fragile versus antifragile. The first one is simplicity. It turns out that generally simple systems are more antifragile. They’re stronger. They survive and get stronger more easily when things are tough, when there’s a shock or an attack or a crisis.

Big complex things that have lots and lots of different little parts and are very complicated generally are more fragile because there are more things that can go wrong with them. For example, let’s take that record company. That record company has thousands of employees.

Yes they make a lot of money but they have to make a lot of money because their expenses are super high.

They’ve got big huge buildings and offices. They’ve got rich executives. They’ve got stockholders that want dividends. They’ve got thousands and thousands of employees in all different areas in all different parts of the world. All of that is expensive, so every month of every year they must sell billions of dollars of records. If they don’t, all of that is threatened very quickly.

If we think about the rock stars, the band is five or six guys. What kind of expenses do they have? Not many. I’m sure they all have big houses and cars and everything right now because they’re rich, but they don’t have an army of employees. They may have a few.

They may have a few personal assistants but they don’t have a lot of full-time employees. They probably don’t have huge offices. Maybe they have a small office building somewhere. They could probably run their whole band out of their house if they wanted to. They’re simple and their expenses are low, so they don’t need to sell billions and billions of records every year.

They’re very successful, but even a less successful band could survive and do very well and have a very rich and comfortable life without selling billions. It could be a million a year or maybe even much less than that.

If they have a strong and loyal following, they could do very well and survive in tough times with far fewer people and fewer sales because it’s a more simple system. The band is much simpler.

There are fewer people and fewer needs. Therefore, it’s easier to survive.

Another quality of antifragile people or systems or organizations is that they learn fast and change fast. They’re able to learn fast and change fast. This is an important thing. When there’s a crisis like when the economy suddenly changes and goes down, and there’s a lot of unemployment and all these things are changing, you have to be able to adapt to that fast.

For big huge companies in the record industry, suddenly everything is changing in the industry but they’re so huge and they have all these levels. There’s the President, the CEO, the Vice Presidents and the Managers. It takes a long time for that organization to make a decision and to make a change because they have to argue about it and have committee meetings and change all the rules and change the procedures.

Then someone doesn’t agree and it takes a long time to change. We can see that in the record industry. They’re still slow to change. They still haven’t adapted to the new situation yet many years after it started.

On the other hand an individual band, like Radiohead or the Rolling Stones – it doesn’t matter, pick your favorite band – they can make decisions very, very quickly. In fact, rock stars are usually kind of famous for making crass decisions and just changing things suddenly. They might do one album and it has a certain sound, and then the next year they do something that sounds totally different just because they want to.

They’re also clever and they can make changes quickly. It’s only five guys that need to agree on everything instead of 5,000. They can just decide to try something new. I’ll give you an example.

A couple of albums ago, Radiohead decided this Internet thing is working pretty well, so let’s just sell our album ourselves. We don’t need the record company.

Let’s do it ourselves. Let’s just put it on our website and we’ll let people decide to pay what they want. They can pay one dollar or they can pay three dollars. No set price. They just decided to try it. For a record company to try something that different – they still won’t do it. It’s just too big of a change for them. They’re big and they’re slow. They can’t adapt. They can’t change fast enough.

This one band had the idea. They said let’s try it. Boom, they did it and it was super successful.

They made tons of money from it. They got lots of new fans from that and then they went on tour and had concerts and made even more money. They made huge amounts of money, plus they didn’t have to pay the record company any money at all because they sold their album directly.

They did fantastically well because of the Internet and online music, but the record companies lost money. They didn’t make any money from them off that album. They lost money. In the past they would have had to sell it through the record company.

Instead they just cut them out. The record companies can’t change or make fast decisions. The ability to learn fast and to change fast and to try lots of things quickly makes you more antifragile. It makes you stronger. It makes you grow from tough times.

Another focus is what we might call an artisan focus or a mastery focus. It means focusing on being really great at a certain skill or a set of skills. It turns out that also makes you antifragile. It makes you tougher. It means that you can survive tough times more.

Let’s use an example. In a record company, you’ve got a lot of people who are good at what they do – accountants, etc. – but there are not many people that you could identify and say oh my God they’re a superstar. They’re famous for what they do because they’re so good. It’s hard to pick someone in a huge company like that.

However, these musicians have mastered a certain skill – in this case music and composing music. They’ve mastered it at a level and now they’re famous for it. They have a bunch of fans that love them for it. No, they’re not making billions and billions of dollars but they are making millions. They have this loyal group of fans so that anytime they make new music there are lots of people who will buy it because they focused on mastering a skill.

In this example, they focused on mastering the skill of making interesting and great music. We don’t have to all be musicians. I focused on the skill of teaching English, not just at an average level but at a high level of mastery so that I’m a little bit famous for teaching English because I worked at it to really master it well. It’s always something that I’m doing. It never ends.

There’s a sushi chef in Japan named Jiro Ono and he’s an old guy. I think he’s still alive. He spent his whole life mastering making sushi and he’s become so famous for making sushi that he was in a Michelin Guide of Restaurants. He got three stars, which is the highest level.

He has a small little restaurant but people pay $300 or more to eat at his restaurant. There’s a waiting list and it’s really hard to get in. He’s not making billions of dollars but he will always have a good income. He will always be successful because he’s a total master at sushi now.

He’s so much higher and above everyone else because he has that level of mastery.

That makes you antifragile. It doesn’t matter if the economy is good or bad. None of that matters because he’s so good that people will always go to Jiro’s restaurant. He’s not dependent on the economy. It doesn’t matter because he’s created such a high level of skill and mastery.

Focusing on great mastery in a certain area makes you stronger. It means that you can resist shocks. You can resist crises. You can resist problems and you actually get stronger from them.

Another quality of being antifragile is called vehicle flexibility. It means that you focused on this great skill but you’re flexible in how you use it. Let’s image Jiro – maybe the building where his restaurant is. What if they closed it? What if they said you can’t come here and they kicked him out and he lost his building?

Maybe he would be flexible. He still has that skill of sushi but maybe he would need to move it to a different place. Maybe he’d have a different kind of restaurant. Maybe he’d go to a different country and be a chef. Maybe he’d get a TV show and he’d have the Jiro sushi TV show. There are a lot of things that he could do with that mastery. He’s flexible with how he uses it.

That’s also important because sometimes a situation changes and the specific thing that you’re doing doesn’t work anymore, but you can still use that mastery and that skill in another way. It’s the same with teaching English. If for some reason online business stopped working, I could still go and do live events and big trainings and still make a good amount of money and have a great life doing that.

I could focus on training people in corporations. That’s something else that I could do. I could maybe get a radio show or a TV show teaching English. There are lots of different vehicles and methods that I could use to use my skill. You have to be flexible about that.

A final thing about being antifragile is the ability to let go. That’s also important. When bad things happen, when a crisis comes or when something painful happens, you can’t hold onto it and focus on it and think about it all the time.

Once it’s in the past you have to just let it go into your past and say goodbye. Let it go back into the past, let go of it and focus more on the future. People who are antifragile tend to focus more on the future and not much on the past.

You can use all of these qualities in your life. You can use it in any area of your life to get stronger and survive tough times or survive a big crisis that happens.

Simplify your life. Pick areas of your life – maybe your financial life, your work life or whatever – and make it simpler. That will make you stronger. It will make you survive better and get stronger.

Focus on learning faster and changing faster. Make yourself more flexible in your life so that you’re not always doing things the same all the time. Get used to trying new things and changing things just to practice doing that.

Focus on one area of your life and really master it. You don’t have to master everything in your life. You can just play in some areas, but choose one thing – maybe your career or whatever it is – and decide to master the skills at such a high level that you’ll actually be famous for those things. You could be famous for being the best accountant in the world. Whatever it is for you, just choose something.

Be flexible with how you use that so that you’re not stuck – like I must only work in this one company in this one way. You can use your skill in a lot of ways, so be flexible.

Practice letting go of bad things. When bad things happen, once they’re in the past practice letting them go, forgetting about them and staying focused on the present and the future.

That’s how you become more antifragile. Use tough times and disasters to actually improve and get stronger. You need this skill in life because all of us must face tough times, suffering and disasters at some point. You’ve got to develop your ability to handle these things and use them to actually get stronger.

See you next month. Bye-bye.