The earth’s crust is made up of several tectonic plates. Fault lines are the places where these plates meet. It’s places of high volatility. These plates are constantly moving and flexing. The results could be anything from tremours to major earthquakes, tsunamis and volcanoes.

Most businesses are also riddled with fault lines. Like San Francisco, we manage the risk. Fall-outs are infrequent and palatable (mostly because we don’t know what we don’t know). These fault lines develop as a consequence of the pressure start-ups are under. The business is cash strapped, under-resourced and immature in its route to market and product positioning.

As the business grows, some of these foundational plates start moving apart or slowly pushing together. Tension starts to build. It seems manageable so we take note, but continue.

Until the pressure pops the top. The financial system falls over, the risk management protocols miss a critical failure our the operational costs become unsustainable.

All businesses develop with cracks in the foundations.

Best to fix it before you build too tall.

Chris Yang

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