What a $200B Fund Manager Teaches Us About Innovation
Howard Marks is one of the most respected investors of our time. His memos are studied by Warren Buffett, Bill Gates, and countless professionals who want to understand markets at a deeper level.
What sets Marks apart is not his ability to find spectacular winners, but his relentless focus on avoiding losers. His simple rule:
“If you avoid the losers, the winners will take care of themselves.”
This may sound uninspired, but it is actually the foundation of enduring long-term success. Big wins help, but avoiding big losses is what makes compounding possible. That is how Marks built Oaktree Capital into one of the most successful investment firms in the world, now managing over $200B. The logic is simple but powerful. A single 50 percent loss requires a 100 percent gain just to break even. That is why avoiding losers matters more than chasing spectacular winners.
The Parallel to Innovation
Most leaders approach innovation like undisciplined investors chasing the next big winner. They brainstorm, explore technologies, or copy competitors, hoping something will hit.
But just like in investing, this approach fills the pipeline with losers: projects built on weak insights, unimportant problems, or untested assumptions about customers. And losers in innovation are not harmless experiments. They drain budgets, stall decision-making, and crowd out more promising opportunities. They trigger layoffs, derail careers, and damage morale. Worst of all, they give competitors an opening to capture the very markets you were trying to win.
The result is leaders shying away from what is accurately perceived as a dangerous gamble instead of a repeatable creative discipline.
The Problem With “Fail Fast”
The popular mantra of “fail fast” makes this problem even worse. According to Nielsen, 70–90% of new consumer packaged goods fail within the first year after launch, and B2B failure rates average around 40%. Failure has been the norm for decades. Telling teams to “fail faster” does not solve the problem; it normalizes a broken approach instead of fixing it.
Where Lean JTBD OS™ Fits In
The real discipline is preventing failure in the first place. Jobs-to-be-Done was created to do exactly that by anchoring innovation in customer jobs. Lean JTBD OS™ extends that discipline, making it simpler, more accessible, qualitative-only, and AI-augmented so more innovation professionals and leaders can benefit from these best practices. This is exactly why we created Lean JTBD OS™, a new operating system that democratizes innovation by removing barriers to adoption.
Lean JTBD OS™ builds on the open-domain contributions of Tony Ulwick and Clayton Christensen, and others who pioneered Jobs-to-be-Done thinking. Their work established a rigorous discipline for understanding customers. My aim is not to replace it, but to make JTBD more accessible to innovation professionals and leaders who want clarity and confidence without the complexity of quantitative analysis.
This structured process prevents losers from ever entering the pipeline. By anchoring every idea in a validated opportunity, JTBD makes it possible to achieve strong product-market fit at concept creation (where fit is based on clearly defined unmet needs and selection criteria, not sales). The result is fewer losers, more winners, and a disciplined, repeatable business process for growth.
JTBD not only keeps losers out, it also shows you how to design winners by giving clear customer instructions about where to focus and what to do to create new value. When you shift your focus from generating ideas and failing faster to helping customers get their jobs done better, innovation stops being a gamble. It becomes a disciplined path to growth.
Looking Ahead
I am grateful to build on the shoulders of pioneers in this field, and my hope is that Lean JTBD OS™ makes these powerful ideas more accessible for teams everywhere.
Want to be among the first to know when the course launches? Just contact me at [email protected], and I’ll add you to my early notification list.
