The Serendipity Mindset

“Think of Alexander Fleming’s discovery of penicillin, the invention of what’s known as Velcro today, and even the astronomical success of platforms such as Airbnb: all of these things developed from unplanned but still decisive insights,” says Jakob Müllner, the Academic Director of the Executive MBA Finance at the WU Executive Academy, who is also a professor at the Institute for International Business at WU Vienna. 

In the field of management studies, the US researcher Christian Busch, who also teaches at New York University (NYU) and the London Business School (LBS), has established the term “serendipity” to describe this phenomenon, i.e., the innovative force of coincidence and luck. 

What Exactly Is Serendipity? 
 

The concept of serendipity is derived from Serendib, the former name of the ancient kingdom of Ceylon, today’s Sri Lanka, and describes the act of stumbling upon precious discoveries. “It’s not merely luck or chance but a combination of coincidence and human action – it’s about skillfully spotting opportunities even when they arise unexpectedly, connecting the dots, and leveraging them,” Jakob Müllner says. 

A Practical Example: How Serendipity led Bitpanda to Success 

In October 2024, the WU Executive Academy hosted an event featuring representatives from Austria’s only unicorn, the fintech company Bitpanda. The company’s remarkable journey began in 2014 with a chance encounter between its three founders at a highway rest stop. 

Despite their shared interest in cryptocurrencies, their backgrounds couldn’t have been more different: a marine mechanic, a semi-professional poker player, and a tech-savvy farmer. Fast forward ten years, and the trio still holds the majority stake in a company now valued at $4.1 billion. 

Bitpanda’s founders embody the very essence of the serendipity mindset, as described by Christian Busch. Their openness to the unexpected allowed them to turn random encounters into groundbreaking innovations. 

From the outset, the cryptocurrency industry -and Bitpanda’s competitive landscape - was defined by disruption, marked by speculation, innovation, and occasional fraud. Thriving in such a volatile environment required constant reinvention, a challenge Bitpanda has embraced. 

Three Prerequisites for Serendipity: How Chance Can Lead to Success 

Christian Busch identifies three key conditions that enable serendipity - the phenomenon of unexpected yet valuable discoveries: 

1. Agency: The ability to recognize and proactively seize unexpected opportunities. Rather than waiting for things to happen, it’s about taking action when chance presents itself. 
2. Surprise: An unplanned event or discovery that sparks new ideas and innovation. These unexpected moments serve as catalysts for progress. 
3. Value Creation: The skill to turn the unforeseen into meaningful and beneficial outcomes. This is where chance is deliberately steered in a direction that leads to long-term success. 

In Christian Busch’s words, the serendipity mindset “is about seeing bridges where others see gaps and then taking initiative and action(s) to create smart luck.” 

Strategic Advantages through Flexibility and Curiosity 
 

What makes the serendipity mindset so valuable is that it helps both individuals and organizations respond to uncertainty and disruptions more aptly. In a world where change is the only constant, this approach fits today’s reality, which is unpredictable and difficult to plan for. 

“Research shows that serendipity particularly flourishes in environments that value curiosity, flexibility, and manifold interactions. Companies that foster these qualities will be able to use hidden opportunities and turn seemingly coincidental happenings into a strategic advantage,” Jakob Müllner says. “Unfortunately,” he adds, “risk affinity and creativity have historically never been natural core competencies or qualification criteria of CFOs.”  

The Serendipity Mindset in Practice: Examples from the Business World  

Google’s policy to allow employees to spend 20% of their work hours on projects they are passionate about gave rise to the development of Google Mail and Google Maps. These innovations were not part of the company’s core strategy but came about as coincidental by-products when the board decided to encourage employees to be creative and experiment. 

Indra Nooyi, the former CEO of PepsiCo, is an advocate for stepping up when unexpected opportunities arise: “In a fast-changing world, we have to keep an open mind for whatever we might come across. Some of our most innovative products grew out of ideas that we never planned for.” 

5 Tips for Establishing the Serendipity Mindset in Organizations  

“If managers want to rely on chance, they will be well advised to take action to create an environment that is conducive to serendipity,” says Jakob Müllner. For daily business practice, he has the following five tips: 

1. Fostering Cross-Functional Collaboration 

Serendipity often arises where different ideas intersect. Create opportunities for employees from various departments to work together and talk about their different perspectives. Inspiring each other in this way has been known to breed new insights and solutions. 

2. Creating an Emotional Safe Space 

If employees don’t feel safe and supported, they will be unlikely to voice unconventional ideas for fear of being judged. Companies such as Pixar have implemented strategies that ensure every single opinion and idea is heard. This has greatly boosted creativity and innovation within the enterprise. 

3. Investing in Flexible Structures 

An environment characterized by rigid workflows is where serendipity goes to die. Create flexible framework conditions instead as these allow for experiments and iterations. Agile methods, for instance, can be used to foster adaptive planning and broaden the perceptiveness for entrepreneurial opportunity. 

4. Supporting Your Team in Staying Mindful and Curious 

Offer training courses and further-education formats that promote skills such as active listening, curiosity, and intuition. These qualities will enable your team to spot even weak signals (think: potential opportunities) that others might overlook. 

5. Using (New) Technologies to Enable Serendipity 

Tools such as AI-controlled recommendation systems can create curated but still chance encounters. This can be used to connect people who work at the same company or introduce them to unexpected opportunities. 

The Serendipity Mindset in Practice: Cultural Dimension  
 

Not all cultures view serendipity positively. Societies that are better at dealing with insecurity, such as Sweden, Denmark, and the Netherlands, are more comfortable in the face of ambiguity, and people in these countries are generally more willing to engage in experiments with unknown outcomes. In many cases, these cultures are traditionally very innovative as they allow for flexibility, tolerate setbacks as a natural part of the journey of discovery, and even value mistakes in this way. 

If you think of Sweden, where globally renowned innovators such as Spotify and IKEA are from, you’ll find it’s a country that fosters a culture of discovery. Emphasizing equality and the need for collaborative environments creates a fertile breeding ground for accidental discoveries. Design-oriented Denmark is a similar example: its society has a high tolerance for ambiguity, which has made the country a pioneer of sustainable innovation,” Jakob Müllner says. 

The opposite are cultures that are eager to avoid uncertainty, such as Japan and Greece, whose stronger focus on structure and sticking to plans can make it harder to develop a serendipity mindset. But also these countries can benefit from targeted efforts to increase interdisciplinary collaboration and create a sense of psychological safety among staff, which can make serendipity more likely. 

The Serendipity Mindset in Practice: Growth in Your Private Life 

Coincidence also plays a role in personal growth. Reflecting on our own lives, there are likely chance encounters or fleeting ideas that subtly steer our paths, sometimes even changing our career trajectory for the better.  

“Personally, I had a life-changing experience during the Gezi Park protests in Istanbul. A conference near Taksim Square caused worry among attendees when the protests escalated. As the participants were locked in the hotel, I met a woman from NYU Stern. She became my book co-author and a close friend. Today, my department and NYU have a strong collaboration. None of this would have happened without the events at Taksim Square and our decision to connect and stay in touch” says Jakob Müllner. 

Serendipity as a Game-Changer in the Finance World 
 

“For finance researchers, the idea of serendipity often runs counter to the foundations and core beliefs of our discipline. Isn’t it a CFO’s job to create certainty, avoid surprises, and ensure consistency? To tell the truth: that’s exactly what they’re supposed to do,” Jakob Müllner emphasizes.  

1. A Clash with Traditional Finance Concepts 

The serendipity mindset questions some of the core principles of finance. Traditionally, it involves risk management and cost-efficiency, for which predictability, optimization, and minimizing uncertainty are key. And the essence of these things is the opposite of the explorative and unpredictable nature of serendipity. Particularly in today’s dynamic and disruptive world, CFOs will be well advised to recognize and even appreciate the enormous power coincidence can wield. CFOs have to know the limitations of the instruments and forecasts they rely on. Market inefficiencies and developments that defy prognosis are not the exception but the rule in today’s volatile environment. They should not be ignored but analyzed and used to develop new strategies. 

2. Probable vs. Improbable Scenarios 

In finance, where most decision-making is based on data, integrating a serendipity mindset not only requires decision-makers to consider probabilities but also and increasingly improbable scenarios. “As a rule, finance zooms in on negative, disruptive scenarios. The serendipity mindset, however, holds that positive developments deserve at least the same amount of attention. What do companies need to make that happen? The answer is cross-departmental collaboration that has the potential of creating innovative finance products and strategies instead of being stuck on the topics that have been on the top of the agenda for many years already,” Müllner says. Being perceptive to a broader variety of topics also means considering new sources of information and data in decision-making processes. The turkey illusion describes people’s cognitive bias regarding pending disruptions when their analysis is based exclusively on historic data.  

3. Cost-efficient vs. Strategic Investments 

Efficiency in finance also means lowering costs and optimizing the allocation of resources. It’s an all-too-common fallacy that all costs must generate some kind of income. From the perspective of cost-efficiency, it might appear counterproductive to allocate resources to unplanned ventures or projects devoted to exploring new topics, but when these resources are effectively managed, they can bring forth disproportionate advantages in the long run. “Many investments and costs do not directly lead to a positive outcome, but if a serendipity investment creates financial value, it’s usually so substantial that it justifies past failed investments. This is why it can be a good idea for CFOs to adopt a serendipity mindset to match that of venture capitalists,” Jakob Müllner shares his conviction.  

4. Quantitative vs. Qualitative Focus 

Financial decisions are often made based on quantitative data and models with a focus on results that can be measured. Serendipity, on the other hand, feeds on qualitative insights and the subjective interpretation of unexpected events. This divergence often makes it difficult for traditionally minded finance experts to fully enjoy the benefits of serendipity. Companies eager to make room for serendipity must thus find ways to deal with this conflict. “They could, for instance, set up a dedicated innovation fund or research units within the organization so that employees can experiment with serendipity without directly impacting financial core processes in the beginning,” Jakob Müllner says. 

5. Reconsidering Forecasts and Evaluations 

The serendipity mindset also upends traditional views regarding the use of forecasts and assessments when making decisions.  

Forecasts: Approximations Instead of Certainties 

Forecasts predict future trends based on historical data, yet serendipity suggests the future is inherently unpredictable. Unexpected events can overturn even the most solid forecasts. Managers should treat forecasts as approximations, not certainties, using them as signposts rather than rigid roadmaps. A survey by Horvath & Partner revealed that 59% of CFOs see planning as their primary responsibility, while only 26% prioritize analysis. In today’s volatile environment, excessive reliance on planning can be risky. A solid analysis is crucial for identifying potential disruptions and proactively developing strategies. It’s essential to incorporate new sources of information, as significant market shifts often don’t appear in traditional financial indicators. These changes often stem from areas outside financial markets, like technology or politics. 

Evaluations: Take Uncertainties into Account 

This view also begs for a reconsideration of evaluations. As a rule, these are based on forecasts regarding cash flow, growth rate, and market conditions. This involves assumptions that can quickly become outdated when something unexpected occurs. The serendipity mindset thus emphasizes the need to view assessments as necessarily incomplete and provisional and as prone to error and changes. By incorporating flexibility and adaptability in their strategies, managers will learn to deal more effectively with the fact that the future is inherently unpredictable. 
 

Conclusion: Serendipity Mindset as a Success Factor in Management  

Serendipity is not only a charming idea; it can be a powerful tool that drives the development of innovation and strengthens an organization’s resilience. Both companies and individuals can benefit from adopting a serendipity mindset, drawing value from chance incidents and turning unforeseen events into game-changing opportunities. As this is easier said than done, it’s important to keep an open mind for ideas that are beyond the confines of classic finance principles and what’s accepted as standard in a given culture in order to strike the right balance between curiosity and efficiency. The question is really not if a serendipitous moment will ever occur, the question is whether you will be ready to harness it when it occurs. 

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