The Salmon Dichotomy
Two fundamental allocation strategies for resource-constrained environments, neither inherently better, both optimized for different conditions.
Two fundamental allocation strategies for resource-constrained environments, neither inherently better, both optimized for different conditions. Pacific Salmon Strategy (semelparous): 70-90% growth, 10-20% survival, 0-10% profitability - all-in on single bet, accept high risk, aim for market dominance. Atlantic Salmon Strategy (iteroparous): 30-40% growth, 30-40% survival, 20-40% profitability - balanced allocation, survive to compound, multiple growth cycles.
When to Use The Salmon Dichotomy
Use when determining overall strategic allocation approach. Choose Pacific Salmon for high-mortality environments (new markets opening, 12-24 month windows, capital available to burn). Choose Atlantic Salmon for low-mortality environments (mature markets, sustainable advantage, profitability enables compounding).
How to Apply
Diagnose Environment Mortality
Assess whether you're in high-mortality (volatile market, intense competition, narrow window) or low-mortality (stable market, established position, long runway) environment
Questions to Ask
- Is there a closing market window?
- What's competitor mortality rate?
- How volatile is customer behavior?
Match Strategy to Environment
Select Pacific Salmon (growth-heavy) for high-mortality or Atlantic Salmon (balanced) for low-mortality environments
Questions to Ask
- Do we have capital to survive aggressive growth phase?
- Is this a winner-takes-all market?
- What's our time horizon?
Set Allocation Ratios
Define specific percentages for survival, growth, and profitability based on chosen strategy
Outputs
- Target allocation percentages
- Reallocation timeline
- Risk thresholds
Plan Reallocation Triggers
Identify conditions that would require strategy shift (e.g., market maturation, capital availability change)
Questions to Ask
- What signals market shift from high to low mortality?
- At what cash level do we force reallocation?
- How quickly can we shift strategies?