"If you start from the premise that we are living in an uncertain world, then optionality is the only way to outperform the average in the long run." — Nassim Taleb, Antifragile
When you think about risk, you almost never think about opportunities.
You think safe means stable markets. Predictable demand. An industry that won't surprise you. But safety isn't found in the type of business you start. It's found in the opportunities surrounding it.
Opportunities are options
Here's a better way to think about it: every business opportunity is an option you hold.
You already understand options: stock options, contract options, real estate options. You pay a small premium now for the right, not the obligation, to act later. Most expire worthless. The value is in having the choice when conditions change.
Business opportunities work the same way:
- That adjacent market you've explored but not entered? Option.
- The partnership you've discussed but not formalized? Option.
- The product extension your customers keep asking about? Option.
You're not pursuing these things. You're holding them.
This isn't just a metaphor
There's a whole field called real options theory, decades of work on valuing strategic flexibility the way you'd value a financial option.
The core insight: uncertainty makes options valuable. The more volatile your environment, the more your options are worth.
"Today's investments can generate tomorrow's opportunities." — Brealey, Myers & Allen, Principles of Corporate Finance
Stewart Myers coined the term "real options" at MIT in 1977. Carl Kester later built on the idea in Harvard Business Review, framing strategic investments as "today's options for tomorrow's growth."
Real options in practice
Merck was one of the first to operationalize this. In the early 1990s, CFO Judy Lewent started valuing drug development projects as options, with each clinical trial phase as a decision point to continue or abandon. The approach has since spread across pharma, oil and gas, and anywhere investments are staged and uncertain.
But this thinking isn't just for enterprises with finance teams. The logic scales down. Every business holds options.
When things go wrong, options give you somewhere to go
Consider a SaaS company that built a CRM for real estate agents. Series A, two hundred customers, solid product. Growth has stalled. The big players keep adding features that eat into their differentiator. What felt like a defensible niche is starting to feel like a trap.
What happens next depends entirely on what options they're holding.
If their only opportunity was "real estate agents need to manage contacts," they're stuck. They can cut prices and race to the bottom. Or watch their best customers churn to platforms with more features.
But what if they'd been holding other options?
- Conversations with property managers who face similar problems
- Relationships with brokerages who need team features
- A workflow engine that other vertical SaaS companies have noticed
- Customer feedback pointing toward a different problem worth solving
Same risk event. Completely different outcomes. The difference is the options they held when the risk materialized.
When concentration becomes fragility
A fifteen-person marketing agency. Good clients, good work, profitable. Two accounts make up sixty percent of revenue. Then one gets acquired. New parent company has an in-house team. Thanks for everything.
If those two clients were their only real opportunity, they're scrambling. Layoffs, desperate pitching, maybe merging with a competitor on bad terms.
But what if their opportunity landscape looked different?
Three smaller clients have been asking for more work, those relationships are options ready to exercise. A productized service they've been prototyping could replace some revenue. A competitor with complementary strengths has floated a partnership. The acquirer's competitors now look interesting, and the agency knows the space cold.
Same client loss. Same scramble to respond. But the agency holding options had somewhere to go. The one without them was starting from zero. The options they'd been holding determined whether this was a setback or a slow collapse.
Opportunities are how you grow
There's a version of this that's purely defensive. Hold options in case you need them. Keep doors open in case something goes wrong.
It works. But here's what's worth noticing: the moves that protect you are usually the same moves that grow you.
Those conversations with property managers? They're not just a backup plan. They're a growth channel. The smaller clients the agency kept engaged? One of them might become their biggest account. The productized service they've been prototyping? That's a new business line waiting to happen.
Every expansion, every pivot, every new revenue line, it started as an option someone was holding. They didn't know they'd need it. They held it anyway. When conditions changed, they exercised it.
A business without options isn't just fragile. It's stuck. Options are how businesses move. And businesses with many options can actually benefit from volatility, every shift is a chance to exercise an option competitors don't have.
Why this matters now
There's a principle from options pricing: volatility increases option value.
When the future is predictable, options don't matter much. You know what's coming. You can plan for it. The option to do something different has little value because you're confident in your current path.
When the future is uncertain, options are everything. You can't predict which door you'll need, so you need more doors. Each option you hold becomes more valuable precisely because you don't know what's coming.
Markets shift faster now. Technology disrupts quicker. What worked for a decade can stop working in a quarter. The more uncertain things get, the more your opportunities are worth.
This isn't abstract. If you're holding options on adjacent markets, new partnerships, or product extensions, uncertainty makes those options more valuable. The volatility that makes business harder also makes your opportunities worth more, if you have them.
The goal isn't zero risk
The goal is knowing which risks you can respond to and which ones would leave you stuck.
Every founder carries risk. The good ones know exactly which risks they're carrying, and how many options they're holding if things go wrong.
So how do you find your options? How do you figure out which ones are worth holding? That's what we cover next.