Look for where there are no bullet holes

In 1943, during WW2, the US military was trying to determine the optimum amount and position of armour on fighter planes and bombers.

In 1943, during WW2, the US military was trying to determine the optimum amount and position of armour on fighter planes and bombers.

They knew that covering an entire plane with armour would make it heavier, slower, less manoeuvrable and, therefore more likely to get shot down. On the other hand, they also knew that fitting too little armour would make a plane susceptible to stray bullets.

Too much armour is bad and so is too little.

When trying to find the answer, the military began to study the placement of bullet holes on the planes that returned to base. This data looked something like this:

Section of the plane — Bullet holes per m²

Engine — 1.11

Fuselage — 1.73

Fuel system — 1.55

Rest of the plane — 1.8

Planes were coming back with more bullet holes per square meter in the fuselage and the rest of the plane than on the engines. The military believed that this meant that the fuselage was more likely to get shot than the engines and was, therefore, the place with the greatest need of armour.

The US military was suffering from survivorship bias. They were only studying the planes that returned from combat.

The reason why planes were landing with fewer bullet holes in the engines was not because the engines were getting shot less often than the fuselage. It was because planes that get shot in the engines are less likely to make it home.

Instead of looking at where the bullet holes were, the military needed to look at where the bullet holes were not.

There is no indication of how many planes were saved when the military finally started fitting the engines with armour, but it is known that the engines of planes fighting in the Korean and Vietnam wars years later were covered in armour.

The same bias that affected the US military can affect entrepreneurs looking to launch a new product or enter a new markets.

It is easy to see a market and believe that the reason why there are no potential competitors is because your idea is unique and untested. Rather consider that the reason why there are no competitors is because the demand for your product is too small, the business conditions are too hostile and that all the previous entrants have failed to survive.

When considering a new market, don’t just look at the bullet holes. Look for where there are none.

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The story of the bullet holes is from How Not to Be Wrong: The Power of Mathematical Thinking by Jordan Ellenberg