Contrarian Smart Bets
I am just back from the Conscious Capital CEO Summit. One of the standout sessions (for me at least) featured Ron Shaich, Founder & Chairman, and CEO of Panera Bread. While explaining Panera Bread’s incredible success story, Ron pointed out his number one advice:
Place contrarian smart bets.
The logic is simple: Betting with the market does not yield extraordinary returns as the markets today have such complete and nearly instantaneous transparency, that any potential upside is already priced in. However, being contrarian is not enough — you need to possess information and an understanding of the opportunity at hand which is beyond what the market sees.
As much as this sounds like advice for investing in the stock market, Ron meant it as advice for running your company. Panera Bread invested heavily (to the tune of 100+ million dollars) into their digital infrastructure when their competitors were still sitting on the sidelines. Surely a contrarian move at the time — but also smart as the Panera Bread team did extensive research into both the market and the available technologies to make their contrarian smart bet on digital. It paid off big time — today Panera Bread is the market leader in its category when it comes to app and web-based ordering and backend processes.
Are you swimming with the stream or does your business entail strategically placed smart bets? Can you identify areas in your business where others might miss an opportunity — and subsequently place your bets?