Joe: Lewis, here’s a wild statistic for you. In the world of venture capital, the top 6% of investments generate 60% of all the profits. More than half of all deals lose money. Lewis: Whoa. So basically, VCs are professional gamblers who are wrong most of the time but win big when they're right? Joe: Exactly. They place a lot of small, smart bets, knowing most will fail. Now, what if I told you that most giant corporations are playing the exact opposite game—placing a few huge, 'safe' bets—and that's precisely why they can't innovate? Lewis: That sounds about right. They’re trying so hard not to lose that they forget how to win. Joe: You’ve just hit on the central puzzle tackled in the book New to Big: How Companies Can Create Like Entrepreneurs, Invest Like VCs, and Install a Permanent Operating System for Growth by David Kidder and Christina Wallace. Lewis: And Kidder isn't just a theorist, right? He's a serial entrepreneur and the CEO of Bionic, the company that actually builds these 'growth systems' for giants like P&G and Microsoft. So he's seen the corporate sausage-making up close. Joe: He's lived the pain. And that pain is the perfect place to start. Before he built Bionic, Kidder learned this lesson the hard way with his own startup, Clickable. It’s a story that I think will resonate with anyone who’s ever seen a great idea die a slow death inside a big company.

Lewis: Oh, I know that feeling. It's the corporate graveyard where good ideas go to be buried under paperwork and committee meetings. Lay it on me. Joe: Okay, so picture it. It's 2009. Kidder's startup, Clickable, is four years old. They've raised $22 million, they have a cool machine-learning dashboard for marketers, but their growth is stalling. They're burning cash, and they're at a crossroads. Lewis: The classic startup panic moment. Joe: Precisely. Then, a lifeline appears. A massive Fortune 100 financial services company comes knocking. They want to partner with Clickable, to white-label their technology and offer it to their millions of small-business customers. It seems like the ultimate solution. Lewis: That’s the dream, right? A huge partner to solve all your distribution problems. The silver bullet. Joe: The silver bullet. So they do the deal. They launch the platform. And it’s a disaster. The small-business customers they get from the big partner behave just like their early, non-paying customers. They use the free trial, poke around, and then vanish. The partnership didn't solve their growth problem; it just magnified it on a massive scale. Lewis: Oof. That's brutal. Joe: It gets worse. They go to raise their Series C funding, and they're pitching two of the most legendary VCs in Silicon Valley: Marc Andreessen and Ben Horowitz. In the middle of the due diligence, Andreessen looks at them and asks the killer question: "What are you going to do when this partnership fails?" Lewis: Wow. To have your entire strategy called out like that, by those guys… that’s a gut punch. Joe: It was a fatal moment. Kidder realized the partnership, their supposed savior, was actually a trap. It was an easy answer that avoided the hard question: who is our real customer and what problem are we solving for them? This failure is what led him to the core idea of the book. He realized that large companies operate on a system he calls 'Big to Bigger.' Lewis: 'Big to Bigger.' What does that mean, exactly? Joe: It's an operating system designed for one thing: efficiency. It's about taking an existing, successful business and making it bigger, more profitable, and more predictable. It’s about optimizing supply chains, cutting costs, and hitting quarterly numbers. It's a system that is incredibly good at what it does. Lewis: Yeah, I can see that. It's about squeezing every last drop of juice from the orange you already have. Joe: A perfect analogy. But here's the problem. That same system, the 'Big to Bigger' machine, is fundamentally, at a DNA level, at war with creating anything new. The book has this incredible quote: "Corporate innovation is failing at a DNA level because the Big to Bigger machine has been engineered to be incompatible with New to Big. It is literally at war with growth." Lewis: It's like a corporate immune system. A new idea comes in, and the organization sees it as a foreign body, an infection, and mobilizes all its antibodies—the finance department, the legal team, the brand police—to attack and kill it. Joe: That's exactly it! The very things that make a big company strong—its processes, its predictability, its risk aversion—become disabilities when faced with the uncertainty of a new venture. The book tells another fantastic story about this. Kidder is invited to speak at GE's global leadership meeting. Lewis: Okay, GE. The quintessential 'Big to Bigger' company for a century. Joe: Right. He's on a panel, and he turns to the CEO at the time, Jeffrey Immelt, and asks a simple question: "How many fifty-million-dollar startups did GE launch last year?" Lewis: I'm guessing the answer was not a big number. Joe: The answer was zero. And Kidder tells him that, given GE's immense resources, talent, and market access, the answer shouldn't just be low, it should be terrifying that it's zero. After the panel, Immelt pulls him aside and says, "That was the most important question in the history of this leadership conference." Lewis: Whoa. Because it exposed the giant's biggest blind spot. They had all the ingredients to create new businesses but had a system that made it impossible. Joe: Exactly. They were a world-class orange-squeezer that had completely forgotten how to plant a new tree. They were all 'Big to Bigger' and no 'New to Big.' Lewis: Okay, so big companies are built to kill new things. I'm sold. The corporate immune system is real. But how do you fix a problem that's baked into the DNA? You can't just tell a thousand-ton freight train to suddenly act like a dune buggy. Joe: That is the perfect question, and it leads us right to the book's core solution. You don't try to change the freight train. You build a dune buggy factory right next to the train station.

Lewis: A dune buggy factory. Okay, I like the metaphor. So you're saying you build a separate system that's designed for exploration? Joe: Precisely. The book calls it installing a 'Growth Operating System,' or Growth OS. It's a parallel system that runs alongside the main 'Big to Bigger' machine. And the most fundamental shift this new system requires is moving from thinking about TAM to thinking about TAP. Lewis: Hang on, 'Total Addressable Problem'? That sounds like more corporate jargon. What does that actually mean in plain English? Joe: It’s a game-changing distinction. TAM, or Total Addressable Market, is the freight train's view of the world. It asks, "Here is the existing market for widgets. How much of that market can we capture?" It's about fighting competitors for a slice of a known pie. Lewis: Right, market share. The language of every quarterly earnings call. Joe: Exactly. But TAP, Total Addressable Problem, is the dune buggy's view. It ignores the existing market and asks a totally different question: "What is a huge, unsolved customer problem out there, and how can we be the first to solve it?" It's not about slicing the pie; it's about baking a completely new kind of pie that no one has ever tasted before. Lewis: Okay, that's a much clearer way to put it. You're shifting from the solution—the product you already sell—to the customer's pain. Joe: And when you do that, the world of possibilities explodes. The book gives some fantastic examples. Think about the first mobile phones. If you were using a TAM analysis, the market was tiny: high-powered lawyers, executives, people who could afford a car phone. The market was maybe a few hundred thousand people. Lewis: A niche product, for sure. Joe: But the Total Addressable Problem wasn't "how do we sell more car phones to lawyers?" The TAP was "people want to be able to communicate with anyone, from anywhere, at any time." The potential market for that problem was billions of people. By focusing on the problem, not the existing market, you invent the future. Lewis: That's brilliant. It completely reframes the business. I love the other example from the book, about the candy bar company. Joe: Oh, it's my favorite. The company sees that people are becoming more health-conscious. Their TAM, the candy market, might be shrinking. So they start thinking about the TAP. What is the problem a candy bar solves? Lewis: It's not about getting sugar. It's a little reward, a moment of indulgence. The book calls it the 'treat yourself' problem. Joe: Exactly! And once you define the problem as 'treating yourself,' the solutions are no longer limited to candy. You could create a line of healthy, delicious carob snacks. Or you could buy a small cosmetics company that makes inexpensive, lush lipsticks. Or you could open a chain of stores that sells affordable, beautiful succulent plants. Lewis: You're not in the sugar business anymore; you're in the dopamine business! It unlocks a whole new universe of growth. Joe: It's a total paradigm shift. And this is where the Growth OS gets really practical. It forces teams to validate the problem before they ever build a solution. The book tells the story of a team at TD Ameritrade that had a brilliant idea for a new product. It had unanimous support from the executive team. Market research was positive. Everything looked green. Lewis: The classic setup for a big, expensive failure. Joe: You know it. But instead of just building it, they were put into the Growth OS. Their job for five weeks was not to build the product, but to prove that the customer problem they thought existed was real. They ran experiment after experiment. They talked to their target customers. And they couldn't find anyone who actually felt the pain. Lewis: So the problem wasn't real. Joe: It wasn't. After five weeks, they went back to the CEO and said, "This idea is a dud. We've invalidated the Opportunity Area. We shouldn't build it." And what do you think the CEO did? Lewis: In a normal company, they'd be seen as failures. The project would be quietly shelved, and their careers would take a hit for not delivering. Joe: But in a company with a Growth OS, the executive sponsor celebrated them. He said, and this is a direct quote, "We absolutely see this as a critical element in creating the environment to do meaningful innovation." They celebrated the team for saving the company millions of dollars and months of wasted effort by finding the truth quickly and cheaply. Lewis: That's the part that feels like science fiction to me. A culture where a quick, cheap 'no' is a huge win. That requires a completely different kind of leadership. Joe: It does. The book calls them 'ambidextrous leaders.' They have to be masters of both operating systems. They need to be able to run the efficient, predictable 'Big to Bigger' freight train with one hand, while simultaneously protecting and funding the chaotic, exploratory 'New to Big' dune buggy with the other. Lewis: And they have to create a space where it's safe to fail. The book talks about the "addiction to being right" in corporate culture. Leaders get to the top by having the right answers. But in the Growth OS, they have to learn to love the right questions instead. Joe: That's the essence of it. They have to shift from being the all-knowing expert to being the chief experimenter, the lead venture capitalist. They have to be willing to place a lot of small bets, knowing most will fail, just to find that one that will become the company's next billion-dollar business.

Lewis: You know, as we talk through this, what's really clicking for me is that this isn't about having a separate 'innovation lab' in the basement. The book points out that those often become career dead-ends, the place where quirky ideas and even quirkier people are sent to be kept away from the 'real' business. Joe: The dreaded innovation theater. It's a huge trap. Lewis: Exactly. What New to Big is proposing is so much more radical. It's about building a parallel power structure. A system with its own rules, its own dedicated funding that doesn't compete with the core business budget, and most importantly, its own definition of success. A system where a quick, cheap 'no,' like that TD Ameritrade story, is a massive victory. Joe: It's an internal venture capital firm, in essence. The Growth Board acts as the VCs, the internal teams act as the startup co-founders, and they get small amounts of seed funding based on the evidence they bring back from their experiments. It's disciplined, it's rigorous, and it's designed to find the commercial truth. Lewis: And that requires those 'ambidextrous leaders' you mentioned. It’s such a powerful concept. The ability to manage two completely contradictory systems at the same time. It's a profound shift from the mindset that dominates most of the corporate world, which the book describes as 'playing not to lose.' Joe: That's the perfect way to summarize the whole thing. The 'Big to Bigger' machine is all about defense—protecting market share, avoiding mistakes, minimizing risk. It's playing not to lose. The Growth OS is pure offense. It's about taking smart risks, embracing the high probability of failure, and relentlessly searching for that one breakthrough that changes the game. It’s playing to win. Lewis: It really makes you wonder, for anyone listening who works in a big company, what's the biggest 'unaddressed problem' your customers have that your company isn't even looking at, because it's so focused on its existing market? Joe: That's the billion-dollar question, isn't it? The book argues that those problems, those TAPs, are hiding in plain sight. You just need a new operating system to see them. We'd love to hear your thoughts on this. Find us on our socials and share the biggest 'TAP' you see in your industry. Lewis: This is Aibrary, signing off.