Allocate resources strategically to ensure both short-term stability and long-term innovation. Dedicate 70% of effort to the core business (1-2 year impact), 20% to riskier medium-term bets (3-5 years), and 10% to high-risk moonshots.

The default assumption for any 'moonshot' idea is that it is likely wrong. The team's immediate goal is to find the fatal flaw as fast as possible. This counterintuitive approach avoids emotional attachment and speeds up the overall innovation cycle by prioritizing learning over being right.

Alphabet's success with long-term projects like Waymo illustrates a key innovation model. The stable cash flow from a core business provides a safety net, allowing high-risk, capital-intensive ventures to survive years of losses and uncertainty—a luxury most VC-backed startups don't have.

For ambitious 'moonshot' projects, the vast majority of time and effort (90%) is spent on learning, exploration, and discovering the right thing to build. The actual construction is a small fraction (10%) of the total work. This reframes failure as a critical and expected part of the learning process.

Founders with personal wealth and companies with massive cash-cow businesses, like Google's search ads, can afford to pursue high-risk, long-term projects like Waymo. This financial security allows them to endure long periods of unprofitability in pursuit of breakthrough innovations.

A moonshot isn't just a big goal. It requires three parts: a major global problem, a sci-fi sounding solution that would solve it, and a specific breakthrough technology that makes the solution seem just barely possible. This framework creates a testable hypothesis.

Companies pursuing revolutionary technologies like autonomous driving (Waymo) or VR (Reality Labs) must endure over a decade of massive capital burn before profitability. This affirms venture capital's core role in funding these long-term, high-risk, high-reward endeavors.

Success isn't linear. Mobile gaming giant Supercell didn't start with mobile games, and drone delivery firm ZipLine began with a robotic toy. This shows that foundational failures in one area can be the necessary learning experiences that lead to market-defining success in another.

Companies tackling moonshots like autonomous vehicles (Waymo) or AGI (OpenAI) face a decade or more of massive capital burn before reaching profitability. Success depends as much on financial engineering to maintain capital flow as it does on technological breakthroughs.