Dismissing, fast and slow

Assuming I see a deal but don’t invest, I arrive at this outcome in one of two ways. I either dismiss the deal at first glance or I decide not to invest after doing in-depth research.

The regrets come almost exclusively in the former group.

The reason is that if I decide not to invest after doing in-depth research, it’s usually for a good reason. I know what I don’t like about the opportunity and I feel comfortable with the level of thought I’ve put into stress testing whether what I don’t like will meaningfully impact the outcome or not.

However, if I dismiss the deal at first glance, I haven’t even given it a chance. And the reason for this is usually because of a heuristic I’ve used to judge the opportunity. The heuristics I use reflect my biases and it’s these biases that sometimes lead to big missed opportunities and hence regrets.

Knowing this, it’s important to keep an open mind when evaluating new ideas. If I feel like I’m dismissing something too fast, it likely reflects a personal bias that could be blinding me to a great opportunity.

You regret what you never gave a chance more often than what you knowingly said no to.

Also published on Medium.