When Is Optimization a Better Bet Than Invention?

Luca Ferrari says optimization is the better bet when the strategy can compound small gains, because radical invention's usual outcome is losing everything. Anish Acharya asks how Bending Spoons chooses when it buys a company such as Miro or Evernote. The mindsets are different, and a company that goes all in on one at the expense of the other is leaving results behind. Apple has leaned toward big inventions without ignoring operations, and Tim Cook made those operations efficient. You still pick a camp.

Radical invention can raise the peak faster. A new iPhone can change a company close to overnight, and Google is still mostly search about 30 years later, around 80 percent of the business, after tens of billions of dollars spent on other bets. That kind of win is rare, and the median case is awful. Incremental innovation is more dependable and easier to measure. On a single-product SaaS company, optimizing only goes so far. At Bending Spoons the same habit compounds: take 100 of EBITDA, turn it into 200, lever it about three times, buy more, and that can become 100x. Which pursuit comes first depends on the strategy.