When deploying AI tools, especially in sales, users exhibit no patience for mistakes. While a human making an error receives coaching and a second chance, an AI's single failure can cause users to abandon the tool permanently due to a complete loss of trust.

When major infrastructure like AWS or Cloudflare goes down, it affects many companies simultaneously. This creates a collective "mulligan," meaning individual startups aren't heavily penalized by users for the downtime, as the issue is widespread. The exception is for mission-critical services like finance or live events.

Corporate creativity follows a bell curve. Early-stage companies and those facing catastrophic failure (the tails) are forced to innovate. Most established companies exist in the middle, where repeating proven playbooks and playing it safe stifles true risk-taking.

Today's market is more fragile than during the dot-com bubble because value is even more concentrated in a few tech giants. Ten companies now represent 40% of the S&P 500. This hyper-concentration means the failure of a single company or trend (like AI) doesn't just impact a sector; it threatens the entire global economy, removing all robustness from the system.

Small firms can outmaneuver large corporations in the AI era by embracing rapid, low-cost experimentation. While enterprises spend millions on specialized PhDs for single use cases, agile companies constantly test new models, learn from failures, and deploy what works to dominate their market.

AI favors incumbents more than startups. While everyone builds on similar models, true network effects come from proprietary data and consumer distribution, both of which incumbents own. Startups are left with narrow problems, but high-quality incumbents are moving fast enough to capture these opportunities.

Companies like Instagram that succeed early become risk-averse because they lack experience in navigating failure. In contrast, enduring early struggles builds resilience and a willingness to experiment, which is critical for long-term innovation.

The global economy's reliance on a few dominant tech companies creates systemic risk. Unlike a robust, diversified economy, a downturn in a single key player like NVIDIA could trigger a disproportionately severe global recession, described as 'stage four walking pneumonia.' This concentration makes the entire system fragile.

Trust can be destroyed in a single day, but rebuilding it is a multi-year process with no shortcuts. The primary driver of recovery is not a PR campaign but a consistent, long-term track record of shipping product and addressing user complaints. There are very few "spikes upward" in regaining brand trust.