70/20/10 Investment Split

Allocate 70% to core, 20% to strategic initiatives, 10% to bets

Eeke de Milliano
How to foster innovation and big thinking

70/20/10 Investment Split

"70% of your building time should really be going to your core product, that has product market fit. 20% of your time should be going to strategic initiatives that aren't core, but they're strategic to the company, that you know you have to do them. And then, 10% of your time should be going towards bets." - Eeke de Milliano

What It Is

The 70/20/10 Investment Split is a simple heuristic for allocating product and engineering resources across three buckets: core business, strategic initiatives, and exploratory bets. Unlike more complex portfolio frameworks, this provides an easy-to-remember guideline that can be applied at team or company level.

The insight is that a lot of product management "can be reduced to funnels and portfolios." This framework gives you a starting point for the portfolio question.

How It Works

70% - Core Product:

  • Your existing product with product-market fit
  • Includes tech debt and maintenance
  • Includes incremental improvements
  • Anything keeping your current business running and growing

20% - Strategic Initiatives:

  • Not core, but clearly strategic
  • You know you have to do them based on your strategy
  • May include platform work, compliance requirements, or expansion
  • Important but not urgent work that serves the long-term vision

10% - Bets:

  • Exploratory work with uncertain outcomes
  • High risk, potentially high reward
  • May become tomorrow's core product or strategic initiatives
  • Innovation and experimentation

How to Apply It

  1. Categorize current work - Map existing projects into the three buckets

  2. Compare to target - How does your current allocation compare to 70/20/10?

  3. Adjust incrementally - Don't make dramatic shifts; adjust planning cycle by cycle

  4. Protect the 10% - Bets are most likely to get squeezed; defend this allocation

  5. Include bugs in core - Tech debt, maintenance, and bugs are part of the 70%, not separate

When to Adjust the Ratio

The 70/20/10 split is a heuristic, not a rule. Adjust based on:

Situation Adjustment
Pre-PMF 90/5/5 - Focus almost entirely on finding PMF
Mature product with strong PMF 60/25/15 - More room for strategic and bets
Technical debt crisis 80/15/5 - Pay down debt before investing in new
Competitive threat 75/20/5 - Protect core, reduce experimentation
New platform opportunity 65/20/15 - More bets to explore opportunity

Source

  • Guest: Eeke de Milliano
  • Episode: "How to foster innovation and big thinking"
  • Key Discussion: (00:48:37) - 70/20/10 investments framework
  • YouTube: Watch on YouTube

Related Frameworks

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