says the controversial author Nassim Nicholas Taleb in “The Black Swan”. This is also the chapter in his excellent book (even though the tone is sometimes exasperatingly arrogant) where Taleb offers some hints on how to leverage the unknown unknown.
1. Avoid negative-Black Swan business where the unexpected can have a huge impact (e.g. Madoff) and expose yourself to positive-Black Swans (e.g. research or venture capital).
2. Invest in preparedness rather than in prediction (Black Swans are unpredictable anyway). Instead e.g. of trying to predict the next earthquake in San Francisco, prepare the citizens and the infrastructure necessary to mitigate the impact of the earthquake.
3. Therefore, seize any opportunity to be exposed to a positive-Black Swan. Taleb advocates for living in cities and going to parties to gain exposure to the odds of serendipity. Please have a look at the long list of examples of serendipity in science and technology.
Interested? The following video gives a short introduction to the current financial crisis viewed through the eyes of Taleb and his mentor Benoit Mandelbrot.