I was reading an article about the “winners” of the bids for the casino licenses in downstate New York and have been reading Adam Kurcharski’s book, The Rules of Contagion (he also wrote a great book, The Perfect Bet, worth a read). It brought to mind another book, Richard Thaler’s The Winner’s Curse, and it got me thinking about how companies end up bidding what they bid.
These two books help explain what’s happening in moments like that. One is about how things spread, the other about how people overpay. Together, they form a neat little parable for modern enthusiasm: when ideas spread through a crowd, the people who “win” them may be the most cursed of all.
Kucharski’s premise is simple. Contagion isn’t magic. It’s the result of a few dull ingredients lining up. A virus spreads when it’s infectious enough, when people mix in the right ways, and when enough of us are susceptible. Replace “virus” with “idea” and nothing much changes.
Some ideas are catchy, because they’re simple, emotional, or make us sound clever when repeated. “We’re the Uber of X” spreads faster than “we have slightly better unit economics,” for obvious reasons.
Some networks are better at spreading ideas, because the right people are connected to the right other people: the colleague with too many LinkedIn followers, the manager with a weekly all-hands meeting, the friend who forwards everything to the family WhatsApp group. And some audiences are just primed: A stressed society is very open to extreme slogans; a stressed company is open to three-letter acronyms promising transformation by Q4.
None of this requires genius. It just needs the standard human mix of curiosity, copying, and the quiet fear of being left out. An idea doesn’t have to be good to spread. It only has to be easy to pass on, the conversational equivalent of a pot noodle.
Thaler, meanwhile, writes about markets and misplaced confidence. The “winner’s curse” describes what happens when people bid for something with an uncertain but roughly common value — for example, an oil field, a company, a casino licence (bidders take note!). Each bidder estimates its worth and bids accordingly. The winner, by definition, is the one who was most optimistic. Or less flatteringly, the one who was most wrong.
That’s the curse. Winning often means you’ve just paid too much. You get the asset and with it the uneasy feeling that everyone else knew something you didn’t. The party carries on around you; only later do you realise you’re the one standing there holding the bill.
Thaler’s larger point is that humans are not the cold calculators of economics textbooks. We overestimate benefits, underestimate uncertainty, and confuse “I got it!” with “This was wise.” We anchor on the first number we see, we follow the crowd, we tell ourselves comforting stories about our own judgment. We are biased, but confidently so, which is not a great combination when money is involved. Or careers. Or reputations.
Combine the two ideas and a pattern emerges. When something, anything, spreads through a network, the last people to adopt it are like the last bidders in an overheated auction. They pay the highest price for the smallest benefit, precisely because everyone else has already bid up the value.
An “idea epidemic” tends to unfold in predictable stages. First comes patient zero; a small group picks up something new, such as a meme stock, a crypto token, a management craze, a “very disruptive app”. At this point, risk is high, but prices are low. If it fails, few notice. If it works, they look like visionaries and are invited to speak on panels with lanyards.
Then the idea spreads. A journalist writes about it, a consultant puts it on a slide, an influencer posts a thread. The story becomes self-propelling: “Everyone is doing this now.” By that point, decisions are no longer about the thing itself, but about appearances. You don’t want to be the last firm without a digital strategy or the last person who hasn’t “embraced agile”. You’re no longer buying the product, you’re bidding against your own fear of missing out.
Think of the meme-stock frenzy, Robinhood and Gamestop. At first, a handful of people on obscure forums, half-amused and half-serious, buy shares in a company everyone else has written off. The price is low, the joke is funny, and the upside seems huge. Then attention spreads. By the time it hits breakfast television, the story is bigger than the company’s fundamentals.
Late buyers rush in, imagining infinite upside, just as the first buyers slip quietly out the side door (it used to be called “pump and dump”). The last buyers “win” the auction; they pay the highest price and inherit the losses when enthusiasm collapses. They’ve caught the contagion at its peak.
The same pattern repeats in offices, minus the stock tickers. A management fashion begins with a consultant (myself excluded, of course!) and a pilot project. Early adopters, usually the people who designed it, gain influence and status. As the initiative spreads, the costs multiply: training sessions, metrics, slogans, workshops. New scorecards are invented. Everyone gets a lanyard again. By the time it reaches the front line, adopting it isn’t optional; it’s mandatory.
The “winners” are those who comply most eagerly and pay the largest price in time and effort, just as senior management moves on to the next big thing and insists this is what they meant all along. Once again, enthusiasm peaks precisely as the value declines.
Even reputations follow the same curve. Outrage spreads online the way a flu does through a dormitory. Each participant must escalate a little to be noticed. Those who join late and loud end up with the most extreme statements attached to their name, just as the mob loses interest and wanders off in search of the next scandal. They’ve “won” the attention game and the accompanying hangover.
Contagion feels democratic. If many people adopt an idea, we assume it must have some merit. But Kucharski’s framework suggests something subtler: who adopts it and when matter. Early adopters face uncertainty, but pay less. Late adopters face certainty of cost and fading upside. Popularity, far from proving value, often signals the point at which the idea is fully priced.
In markets, this is obvious. Bubbles happen when collective enthusiasm inflates prices faster than reality can keep up. In culture and organisations, the mechanism is the same, but the currency changes. We pay not with cash, but with attention, credibility, or working hours. The logic stays constant: The faster an idea spreads, the greater the temptation to overpay for belonging. It’s just that instead of an overpriced barrel of oil, you end up with an overcrowded initiative and a new reporting dashboard.
This can sound fatalistic. Networks spread things, humans are biased, and we’re doomed to overpay for bad ideas in public. But both authors are, in their own dry way, optimists. They argue that once you recognise the pattern, you can adjust.
One option is to treat virality as a warning sign, not a recommendation. If something is spreading unusually fast, assume your estimate of its value is contaminated by everyone else’s excitement.
Another is to ask who benefits most and when. Early adopters get the upside of novelty; late adopters get the invoice. If you’re late, demand a discount of money, effort, or enthusiasm. At the very least, give yourself permission not to match the volume of the people who were there first.
You can also pause before joining the crowd and ask a few unglamorous questions. Would I find this compelling if I hadn’t heard about it from excitable people? If I “win” by joining now, what exactly am I winning? The answers, if honest, are often humbling. “Peace of mind that I am not the last person on this bandwagon” is a perfectly valid motive. It is just not the same as value.
And you can design systems that expose the truth earlier. Economists note that in auctions, revealing more information reduces the winner’s curse. The same applies to contagious ideas. Small pilots, independent evaluations, and honest post-mortems are ways of injecting reality before everyone has signed up. They don’t make us perfectly rational, but they do make it slightly harder for enthusiasm to outrun evidence for too long.
Kucharski shows that contagion is not just a metaphor. Ideas really do spread like infections. Thaler reminds us that winning is not always a compliment; it can simply mean we were the most optimistic in a world where optimism is expensive. Put them together and you get a tidy rule of thumb: When something is spreading fast and you feel an urgent need to be part of it, pause and ask, am I catching something valuable or, perhaps, just trying very hard to overpay?
If, after that pause, you still want to join in, go ahead. Some ideas are genuinely worth catching. Just remember, in the grand social auction of attention, the loudest winners often end up the most cursed.
