What it is
Instead of projecting how much you could win, decide up front how much you can afford to lose if this goes to zero. It comes from effectuation, a way of describing how experienced entrepreneurs actually decide.
The constraint is freeing. When you know your worst case and can survive it, you can try things with big upside, and treat them as experiments whose lessons are worth the cost even if they fail.
How it shows up for me
I use it for side projects, money and time. “Can I lose this weekend to it?” is an easier question than “will this work?”, and it gets me moving.