Imperfect information is more fun

I had an epiphany yesterday related to chess and entrepreneurship. I figured out why chess makes me so frustrated and why when I picked up chess in the pandemic, my chess rating hit a plateau above average, but no where as high as I expected.

The problem is that chess is a game of perfect information. The challenge isn’t in predicting the next few moves. The challenge is in finding the best possible move (or at my level, one of the top three moves) out of a collection of options so vast that there are not enough atoms in the universe to count them all.

That may sound exaggerated, but the reality is that there are so many possible unique chess games that 10-12 moves into a 30-40 move game, two amateurs are likely playing a game that has never been played before.

There aren’t any fewer possibilities when it comes to decision making in startups, but the difference is that for entrepreneurs (and startup investors) only have an imperfect view of the world, with no chance of knowing everything needed to make the best decision.

I have three decades of experience playing that game, and I’m good at that game because I’m not scared of the idea of making decisions without having an ideal or complete set of facts.

And that was the trigger of the epiphany, that I plateaued in chess because I’m comfortable trusting my gut in a minute or two rather than spending 2-3 minutes calculating five or more moves forward. All that calculating gets tedious, especially as you are not supposed to breakout a spreadsheet or other tool to make that process easy.

Ultimately this is the divide between those that love chess and those that don’t.

The lesson for entrepreneurs (as there always seems to be a lesson for entrepreneurs) is that if you are the type of person who gets paralysis from analysis, you probably love chess and get frustrated in business. If on the other hand you are comfortable with limited information, you’ll probably find entrepreneurship a lot more fun, as that is the core of that game.

You have a decision to make. If you have seconds to decide, you go with your gut. If you have minutes, you might take that minute to weigh Plan A with Plan B. If you have weeks you might create a pro-con list to help decide between those two – or even three – options. If you have months, you might take the time to brainstorm for some out-of-the-box options. What most people overlook is that there...

A few months ago I was interviewed on a podcast where the key question was “What is your superpower?” Sounds innocuous and simple, but it was one of those moments to reflect on life and not just provide a truthful answer, but something interesting and thought provoking. My answer was “If only”. What if _____? I’ve been an entrepreneur for over thirty years, founding or co-founding 10 companies. I...

I’m in a reprise mood this season… recently thinking about a blog post from 2015 with a lesson learned in an old movie on how to blow up a dam. A lesson about the expectations when making a big change to the world. The lesson comes from Force 10 from Navarone, starring Harrison Ford and Robert Shaw. This is a movie I first saw on a Sunday afternoon on TV as a pre-teen, and then dozen...

There are so many lessons in startups, startup investing, and technology adoption that come from looking back a few decades. For example, I’m out of the 1970s nostalgic computing rabbit hole, but that journey has subsequently led to reviewing the technological progress of the late 1900s and early 2000s. This week, that was the rise of the RISC-based CPU, which was then obviously going to...

The buzzword of 2024 is “AI” and like social, mobile, cloud, fintech, and blockchain, every startup is claiming to have it and every big startup fundraising is claiming to expand what can be done with it. Or in short, we’ve been here before. A Grand Unified Theory of the AI Hype Cycle does a very good job explaining how this will play out in 13 steps, and how it already played...