What's your circle of competence?

It’s a freezing cold Saturday morning in New York’s Greenwich Village and there’s tension in the air.

On the snow-speckled artificial turf of James J Walker park, our team are a goal down with less than a minute on the clock.

Our de facto captain and star player turns to me and says ‘go up front’.

My feet root to the ground.

I don’t do ‘up front’. I don’t do wing, number 10, or even midfield.

It’s outside my circle of competence.

I’ve never been very good at football [1] – I stopped playing at 15 and started again around 27. Somewhere in that intervening period I instinctively found my circle of competence.

How did I know?  Unlike most who play 7-a-side games for competitive fun, I began only playing in one position. At the back, the last line between striker and goalkeeper.

My circle of competence isn’t even really a circle; it’s a zone, the deepest third of the pitch.

I’m still far from the best player on the field, in fact I’m in the lower quartile, but I stay in my circle of competence, just focusing on the basics.

Be aware of the other players.
Anticipate where the ball is going to go.
Win it.
Distribute it.
Avoid conceding.

That’s it.

I could try playing elsewhere, but I much prefer to strengthen those basics and just push at the edge of the competence circle. It may not be glamorous but there’s plenty there to build on, and it’s very satisfying when it goes well. Ask any centre-back.

My experiences on the football pitch have started to help me when it comes to thinking about my career and business.

The marvellous Tren Griffen talks about this here:

The idea behind the Circle of Competence filter is so simple it is embarrassing to say it out loud: when you do not know what you are doing, it is riskier than when you do know what you are doing.

And as Charlie Munger says regarding investing; “We have to deal in things that we are capable of understanding.”

“[When] one of the economists who… shared a Nobel Prize … went into money management himself, he sank like a stone.”

Charlie Munger

The basic premise is to invest where you’re competent – focusing on strengths, not trying to improve weaknesses.

Brian Fetherstonhaugh talks about this when it comes to planning the second big phase of a career in his book The Long View.

So, early on feel free to go and test things out, find out where the circle is.

Once you have it enjoy playing inside it, pushing at the edges and making it stronger.

Where am I investing next?

A goal-saving slide tackle of course.

[1] I’ve been flipping between ‘soccer’ and ‘football’ since living in the US but I feel compelled to stick with ‘football’.