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# What Are The Odds – Pareto Rule Applied To Business

Here is the infographic about 80/20 Pareto Rule, the odds of success.

Source: Funders and Founders

Vilfredo Pareto, who observed in 1906 that 80% of the land in Italy was owned by 20% of the population; he developed the principle by observing that 20% of the pea pods in his garden contained 80% of the peas. It is a common rule of thumb in business; e.g., “80% of your sales come from 20% of your clients”. Mathematically, where something is shared among a sufficiently large set of participants, there must be a number k between 50 and 100 such that “k% is taken by (100 − k)% of the participants”. The number k may vary from 50 (in the case of equal distribution, i.e. 100% of the population have equal shares) to nearly 100 (when a tiny number of participants account for almost all of the resource). There is nothing special about the number 80% mathematically, but many real systems have k somewhere around this region of intermediate imbalance in distribution.

From Wikipedia

The original observation was in connection with population and wealth. Pareto noticed that 80% of Italy’s land was owned by 20% of the population.He then carried out surveys on a variety of other countries and found to his surprise that a similar distribution applied.

Pareto Rule

Universal rule applies to the odds of success: your odds of winning go up to 80%  when you achieve the 20% that give you the most result. That is great odds.

[Editor’s Note:  This article was written by Anna Vital and originally published at Funders And Founders. Copyright 2013.]

Note: The views and opinions expressed are solely those of the author and does not necessarily reflect the views held by Inc42, its creators or employees. Inc42 is not responsible for the accuracy of any of the information supplied by guest bloggers.

### Author

#### Anna Vital

Influencer

Anna Vital is an infographic author and visual journalist at Funders and Founders. She loves to visualize the lives of people, companies, and ideas. Her dream is to create a visual encyclopedia where every entry is an infographic. Anna holds a Juris Doctor and a BA in Linguistics. She speaks Chinese and Ukrainian. She is excited to see how her visual thinking method can help people visualize their own ideas.

https://inc42.com/entrepreneurship/people-dont-doubts-way-creating/

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