When I was a kid, my mom always had the Coldplay album X&Y on in the car. It’s been quite awhile since I’ve listened to it, but I still know every word to every song and one lyric is the perfect title for today’s theme.

As a community, we spend quite a bit of time handwringing over risk (for good reason). The neverending decision between going as hard as possible and burning something forever vs. making a more calculated choice to try and make more by staying alive is something we wrestle with every time something new appears. 

While the type of risk that earns the lion’s share of discussion is the risk that you can control as a grown adult that can make their own decisions for how much they want to push, there’s a handful of risk factors that are outside of your control.

Matt at MEAB wrote about one of the most important ones a couple of weeks ago, and if you haven’t read it, it’s an important one to keep in mind. For the most part, things go swimmingly between parties in the churning world, but there’s always a chance of things going sideways that you can’t control. Let’s all ski on the bunny slopes, ok?

To channel Matt, I’m going to talk about a slightly different type of risk, apropos of nothing. As I’ve blabbed about many times, there’s levels to this hobby. In knowledge, in risk tolerance, and most importantly for this topic, raw throughput. 

It’s wise to keep this in mind when an opportunity comes across your desk and you’re considering how to handle it. Let’s face it – unless you stumble upon a credit union in Tuvalu, there are virtually no plays where you’re the only churner involved. There’s always a bigger fish in the sea, whether that means higher risk tolerance, more capital, more players, or some combination thereof. 

And that’s ok – if nobody else (especially experienced whales) wants to hit something, there isn’t actually anything there. But it does mean that there is now some collective risk when there is a group of people doing something that costs a company money, especially since there will be commonality in methods to achieve that action. 

How much risk there is in following the heaviest hitters varies, and we don’t really have visibility into how much a target will care about scale. To illustrate, let’s look at two major shutdown waves from the last two years:

The first one was inevitable, and I think most people who were shutdown have no regrets. However, many many churners who were doing the exact same thing at a slightly smaller scale (or even a similar one in some cases) were spared and continue to be a thorn in the side of this company. This unprofitable activity was extremely easy to root out, but they drew some arbitrary line in the sand.

The second one was more scorched earth, in that if you had ever been within 10 miles of someone that had run $500 on this play, you were shutdown. Thankfully, this wasn’t a banking relationship that many people are worried about (unless your knitter grandmother AU was pissed to lose her favorite card).

The first example had room for churners of every level of volume to eat, for better or worse. The second is more of what I’m talking about today – where volume doesn’t matter whatsoever. If you have the scarlet letter on, you’re done. 

So, why am I talking about this today? Well, it’s safe to say when something is being touted as the play of the year from the rooftops that the entire churning food chain is going to be pulling up at the table.

Some plays, like ones involving Fortune 100 banks, take awhile to be unraveled due to all of the cross functional red tape. If I were picking a situation to be more measured in, it would probably be one of these.

Others can be effectively neutered by pushing a tiny update. In those cases, I’m not sure how confident I’d be in them sticking around in a profitable form. Fortune favors the bold, and that is certainly the case in this hobby.

In the end, sometimes calculated restraint can be a valid strategy. In certain places, you can stay alive for a very long time while remaining an extremely unprofitable customer. But in most other cases, whale watching from a position of reasonable volume is pointless. This isn’t going to last, and do you really care about keeping this platform anyway? 

Manuia!

Fun fact: Tuvaluan is the first language I tried to cheers in that is not on Google Translate. Thankfully omniglot.com has us covered!