3 Easy Tips for Embracing Uncertainty Mid-Pandemic
Uncertainty and startups go hand in hand. Whether you’re planning micro-pivots to product development or macro-pivots in light of recent market change, you’ll need a well-tuned internal schema to assess uncertainty. In the wake of the pandemic, startups across all stages have been pressed to make swift decisions and adjust plans. Today, more than ever, the relevant question founders should be asking themselves is: what’s my bet?
In a recent Dreamit Live, Annie Duke (@AnnieDuke), best-selling author and former professional poker player, posed this important question. Annie spoke with Dreamit Venture’s Managing Partner Steve Barsh, to reveal a ton of helpful and pragmatic decision-making tactics for founders. The episode is available in its entirety at the bottom of this page, but here we’ll distill three easy tips founders can use to manage uncertainty.
Let go of control
In poker, you don’t know what the next card will be. In fact, as Annie explains, “It would be a huge mistake for me to think that it’s my job to know what the next card’s going to be.” Making decisions as a founder or in life is no different - we’re all waiting on the next turn of the card. But it’s easy to get caught up in the uncertainty and attempt to predict that next card exactly. That’s why the first step to embracing uncertainty lies in letting go of control. Only then can you begin thinking in probabilities and properly framing your decisions as bets.
Don’t run from uncertainty - Learn from it
The world may have felt stable and predictable prior to this pandemic - that was an illusion. Annie explains, “it only seems stable relative to the uncertainty and instability COVID-19 has brought on. The illusion is to wrap ourselves as founders around what we previously deemed comfortable. It’s a fallacy and a false sense of certainty that dulls our decision-making edge, which is a critical component to the founder’s toolbelt. Founders should avoid uninformed optimism and embrace this current decision-making environment as their new normal. Don’t run from it, learn more it. Dig in - figure out how to make decisions in these shaky times and keep that mentality when things normalize. Things will change again, as market dynamics inevitably do, but you’ll be well-adjusted to lead your startup through the next macro-level uncertainty when it hits.”
Think in bets & prepare for multiple scenarios
Thinking in bets requires you to “Think about the reasonable scenarios that could occur, and then what are the decisions that you can make to maximally prepare you across those scenarios.” This statement implies that startup strategy isn’t binary. You’ll want to emulate a poker player that groups possible outcomes together (i.e. the possibility of that card being clubs). Your plans should reflect multiple possible outcomes or bets on alternative versions of the future. Those bets will impact the decisions you’ll have to make. As you hedge your bets, you’ll want to keep two types of decisions in mind during scenario analysis:
Decisions that work for all scenarios
Decisions that are easy to reverse
These types of decisions are favorable to mitigate your risk. For instance, say you’re torn between extending runway or burning your business development (BD) budget to go after newly vacant customers. The two choices have different levels of fluidity. As money cannot be unspent, extending runway would be the more reversible option. With the information landscape shifting every day, making easy-to-fix decisions is your best bet. A final word of warning - do not be driven or discouraged by the fear of making the wrong bet. Decide, measure, learn (and repeat).
Watch Annie Duke’s full Dreamit Live episode below. All past shows here.
By Elliot Levy, Healthtech Associate at Dreamit Ventures
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