#164 – How to make great decisions in times of uncertainty with radical open-mindedness

Show notes from Episode #164 of the Sweaty Startup Podcast.

As we’ve navigated the past four weeks, it’s shocking how much things have changed and how many times Nick has changed his mind on something. The unpredictable news cycle means that your opinion today may be proven wrong tomorrow, as new facts are constantly coming in. However, people are terrified of changing their opinion, and often don’t even realize how much they’re blinding themselves from information that conflicts with it.

This may seem simple, but close-mindedness, denial, and slow reactions are incredibly destructive towards both your business and your life. This is detailed in the book Principles by Ray Dalio, who laid out his mindset for making incredibly hard decisions. One of the principles he outlines is “radical open-mindedness”, which is the search for the truth and nothing else. It involves being constantly willing to change your mind, use new information that comes to you, and adjust your opinions. For most people it’s easy to develop a viewpoint and then only seek out information that supports it. We are wired to seek information that supports our goals, viewpoint, and opinion, and filter out the rest.

People constantly think they know more than they really do. They weigh in on if sports seasons will be canceled, whether or not you should be buying a house or taking on debt right now, and how the stock market will do tomorrow or this month or next year. People are opinionated but usually not fully informed, and this includes Nick.

We need to take information as it comes in, change our minds often, admit when we’re wrong, and make the best decision that we possibly can with all information. Emotions will drastically hinder your ability to make great decisions–people make decisions driven too much by greed, selfishness, anger, fear, or optimism.

The people that are really great at making decisions are great at letting all information come in, considering it all equally and rationally, and are willing to change their mind in a radical way. This is incredibly valuable right now in such uncertain times, when nobody can go so far as predicting tomorrow.

This begins with understanding what you do know and what you have no idea about. A great example of this is a basic can opener; most people think they know how a can opener works, but when given a pen and paper they can’t draw one and clearly display how it operates to grip the can, crank, and remove a lid. We overestimate our own knowledge.

The great thing about business is that you don’t need to understand everything. Nick knows a little bit about self storage, he knows a little bit about service-based businesses, and most importantly he knows enough to make him money and to feel secure. You don’t need to be an encyclopedia of knowledge, you just need to identify what you do better than other people, and what you know more about than the average person. 

Radical open-mindedness, understanding what you don’t understand, and rational decision making will determine who can weather the storm that we’re facing. These people are going to win.

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About Me

I started the Sweaty Startup in December of 2018 because I believe the Shark Tank and Tech Crunch culture is ruining the real spirit of low-risk entrepreneurship.