Practical decision-making tips from a former poker pro
“You’re slogging your way through an uncertain system. Outcomes and decisions are loosely linked, and there’s so much hidden information.” Annie Duke was talking about poker, but this quote is just as apt for the game of startups.
Without a solid decision process in place, founders and poker players alike risk amplifying the cognitive biases that frustrate all of our decisions, resorting to “track records,” “gut feelings,” and “instincts.”
One such bias is what Duke calls “resulting” — a human impulse to equate the quality of a decision with the quality of its outcome. “I have yet to come across someone who doesn’t identify their best and worst results rather than their best and worst decisions,” she wrote in her bestselling book, “Thinking in Bets.”
This was one of many concepts that resonated with First Round partner and co-founder Josh Kopelman when he first read the book. Intrigued by how we could apply Duke’s frameworks to our own work of backing and advising founders who are just getting started, Kopelman got in touch.
After a few weeks of a trial consulting engagement, a partnership quickly solidified. And so for the last few years, the First Round team has had the great fortune of working with Duke, and today we’re thrilled to announce that she’s become our Special Partner for Decision-Making Science.
Duke’s resume isn’t standard fare in the startup world. She’s forged a fascinating career with several distinct chapters: first as a PhD student in cognitive science at the University of Pennsylvania, next as a professional poker player who made millions in tournament games, and now as a decision strategy consultant.
On top of helping us bring even more rigor to our own investing process, Duke has also been a wonderful addition to the First Round community, sharing her advice with founders and angel investors in closed sessions. But given our focus on open-sourcing so others in the tech ecosystem can learn, we thought readers of The Review would be curious to see a few pages from her decision-making playbook, tailored specifically for the startup context.
In this exclusive interview, Duke offers a behind-the-scenes peek at her consulting work, sharing the very advice and frameworks that she walks founders in the First Round community through. Here’s a preview of what you’ll read today:
- 6 mental models to sharpen your personal skills as a founder, and level up decision hygiene company-wide, especially as you scale.
- Frameworks for all the decisions founders face, from hiring and firing, to product strategy and customer discovery.
- Advice for taking on the “bet the company” decisions, including navigating acquisition offers and making the painful choice to wind things down.
Thanks, as always, for reading and sharing!
–The Review team
Practical decision-making tips from a former poker pro
“You’re slogging your way through an uncertain system. Outcomes and decisions are loosely linked, and there’s so much hidden information.” Annie Duke was talking about poker, but this quote is just as apt for the game of startups.
No matter if you’re on the founder’s or investor’s side of the table, startups look a lot like poker. They both involve big gambles, the kind where it’s unclear whether you’ll end up with a winning hand, or a “bad beat story” because the cards just didn’t go your way. There’s also a series of small decisions that need to be made at a lightning-fast pace — and a need to keep close tabs on your competitors, while not getting knocked off your own game. And if you’re forced to fold, you’re left to wonder if it was doomed from the outset, or if poor execution and unforeseen forces played a role.
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Πηγή: review.firstround.com
Recommended resources:
– This thread on how to be a better manager for remote teams.
– Advice on what managers should do when a team member quits.
– How to optimize for luck.
– This read from Casey Winters on how to justify “non-sexy” product investments.
– How to create a culture of engineering productivity
