“No,” you say, “I’m talking about how startup founders strike it rich by believing
in themselves and their ideas more strongly than any reasonable person would. …”
It’s important to realize that this is another myth perpetuated by the media and our ignorance of the statistics. Most startups fail; I think the statistics are that 80% die in the first 5 years. But the ones that get written up in glowing articles are the ones that succeeded. Of course all those founders who struck it rich believed strongly in their ideas, but so did many of those that failed. That irrational belief may be a crucial ingredient for success, but it doesn’t supply a guarantee. Most of the people who held that irrational belief worked for businesses that failed—but they didn’t get their name in the paper, so they’re relatively invisible.
Still, if everyone who does succeed has an irrational belief in their own success, then it’s not wrong to conclude that such a belief is probably a prerequisite (though certainly not a “guarantee”) for success.
Maybe the reason why so many startups fail is that people are prone to have irrational beliefs about business ideas. This causes many entrepreneurs to pursue bad investments or irrational business practices.
More relevant to the discussion topic, consider these questions:
Some beliefs have the tendency to be self-fulfilling prophecies, but is it irrational to have these beliefs? Is self-deception necessary for the “self-fulfilling” property to work? Can we, say, have a positive outlook on life while having rational expectations at the same time?
The former. I think that “life [in general] is good” is just a way of explaining what is meant by “having a positive outlook on life”, while “[my] life can be better” is a particular belief that influences whether or not you have the positive outlook.
[my life can be better] produces [positive outlook] and [positive outlook] is another way of saying [life (ie the lives of humans in general) is good]
or: “If I believe that my life can be better, then I believe that life-of-humans-in-general is good.”
I’m not implying that you actually believe this, just that this is what you were saying “positive outlook” meant. Am I right? From this perspective a positive outlook seems like a non-sequitur, since the future quality of my life may not provide much information about the lives of other people. Not to mention the fact that some people have good lives with bright futures and some have bad, hopeless ones, so the notion of life-in-general seems meaningless. From this I conclude that I do not have a positive outlook.
I agree with the first interpretation if you replace produces with presupposes or is the sort of thing you believe if you have the feeling of.
I also didn’t mean that [positive outlook] involves people at all: I think it’s more of a feeling about existence in general. It’s true like you say that there is so much variety from one person to another and over time, and that [life in general] as a concept doesn’t make much sense when you really think about it, but that doesn’t stop us from having a feeling about it. We know that it’s silly to talk about whether chocolate ice cream tastes good in general, and yet if you have always loved chocolate ice cream, there is a strong feeling that the goodness is an attribute of the ice cream itself rather than a description of your preferences, which is what you believe when you stop to think about it. The feeling for chocolate ice cream is to the feeling of [positive outlook] as the thought of “I love chocolate ice cream” is to the thought of “my life can be better” (can be better as in “has no upper bound” rather than “has nowhere to go but up”).
I feel like I’m expressing myself so poorly that I should just stop before I confuse even more.
Hmm, good point. But is that a specific belief, or a family of beliefs parameterized over values of “good”? Still, it’s a subjective belief constraint, if nothing else.
I think it’s an attitude, which is a set of dispositions to think and believe (and thus act) in certain ways. The disposition can be represented internally as a belief, but it’s actually something more fundamental. The belief corresponding to an attitude is a representation rather than the thing itself.
To illustrate what I mean, consider people suffering from depression. Their primary problem in cognitive terms is not that they have particular dysfunctional beliefs (my life sucks, I’m a failure, etc.), but that they have a dysfunctional attitude that predisposes them to act in self-defeating ways and adopt particular self-defeating beliefs. They have an attitude that manifests as a strong predisposition to filter the positive, blow the negative out of proportion, and interpret every event in life in a way that would actually be cause for unhappiness if the interpretation were accurate.
Julian Simon’s Good Mood is a counterexample. He was seriously considering suicide once his children were grown—he had no pleasure in life and a high background level of emotional pain.
Still, he was running his life quite well, and got over his depression when he finally had everything squared away enough that he could spend a little time thinking about it. He concluded that depression is caused by making negative comparisons about one’s situation, and found a bunch of strategies (lower standards, improve situation, find something more important than making comparisons, etc.) for not making them.
Yes, having a belief can have the side effect of changing your behavior independently of how you would consciously change your behavior in light of your beliefs.
When you have an accurate belief, and the side effects of believing it affect your behavior in a way you consciously believe is positive, then take advantage of it! If you can get a boost toward your goals without making a conscious effort, then by all means cut out conscious effort as the middleman in the causal chain between your beliefs and your goal state.
But if you spy a shortcut between an inaccurate belief state and your current goal, don’t follow the causal chain from the beginning, but meet it in the middle. Strive to shape your behavior according to your prediction of its effect, but leave your innermost beliefs to entangle with reality. They are shaped too much by non-entanglement processes as it is.
Good point. It might be that there are very few business ideas that actually are rational to have confidence in—otherwise, someone probably would have implemented them already. In other words, most business ideas, even the ones that turn out to be good ones, might be inherently bad gambles a priori.
It’s also possible that business ideas aren’t actually all that important, and that other factors dominate the success of a start-up. I believe this is essentially Paul Graham’s position, for what that matters.
I think the best approach is a slightly more sophisticated one: commit to the belief that there is a way to succeed and you will find it—but not necessarily that you have already found it.
But is it also true that 80% of entrepreneurs fail? I was under the impression that yes, 80% of startup companies fail, but the average entrepreneur might start five or more companies over his career, so that average success rate per person is much higher than 20%.
Interesting question. It would be useful to know what the real statistics are. We certainly know that some successful entrepreneurs start up several companies, and that some of them have multiple successes. But it’s harder to find reports about serial failures. I think I’ve read that (successful) VCs don’t count prior failures against CEOs they’re considering funding, and sometimes the people they place in funded companies are experienced with start-ups, but haven’t had any big hits yet.
But for most people, I think the real question is what type of start-up to join, not whether to start one of your own. The vast majority of people at every successful company weren’t founders, and weren’t even early joiners. I think for relatively young workers, joining a succession of promising start-ups may be the right way to spread your chips around. Stay for 3-5 years (and work at it with all your heart and mind) and after that much time, if it doesn’t look like blistering success is just around the corner, move on to another opportunity. As you get older (and don’t have a big win under your belt) it probably makes more sense to take a lower chance on the big win in order to get more current income.
Agreed. History is written by the victors; just as evolution’s path is paved with the untold number of those which died for lack of fitness or simply luck.
That which is successful and remains eventually isn’t representative of all that has been attempted. Especially when those attempts have been made with little planning, knowledge, method, or even, when they’ve simply been made at random or based on beliefs that weren’t entangled with reality. Holds true of any optimization process.
The less intelligent and “rational” the process, the more trashed byproducts to be quickly forgotten.
It’s important to realize that this is another myth perpetuated by the media and our ignorance of the statistics. Most startups fail; I think the statistics are that 80% die in the first 5 years. But the ones that get written up in glowing articles are the ones that succeeded. Of course all those founders who struck it rich believed strongly in their ideas, but so did many of those that failed. That irrational belief may be a crucial ingredient for success, but it doesn’t supply a guarantee. Most of the people who held that irrational belief worked for businesses that failed—but they didn’t get their name in the paper, so they’re relatively invisible.
Still, if everyone who does succeed has an irrational belief in their own success, then it’s not wrong to conclude that such a belief is probably a prerequisite (though certainly not a “guarantee”) for success.
Maybe the reason why so many startups fail is that people are prone to have irrational beliefs about business ideas. This causes many entrepreneurs to pursue bad investments or irrational business practices.
More relevant to the discussion topic, consider these questions:
Some beliefs have the tendency to be self-fulfilling prophecies, but is it irrational to have these beliefs? Is self-deception necessary for the “self-fulfilling” property to work? Can we, say, have a positive outlook on life while having rational expectations at the same time?
Surely having a positive outlook on life doesn’t require any specific belief.
Except that life is good that is.
No. That life can be better is sufficient.
To think that your individual life can be better is a way of thinking that life in general is good.
By life in general do you mean the lives of humans in general, or just your own life, extended in time?
The former. I think that “life [in general] is good” is just a way of explaining what is meant by “having a positive outlook on life”, while “[my] life can be better” is a particular belief that influences whether or not you have the positive outlook.
“Influences” is vague, but I take it you mean:
[my life can be better] produces [positive outlook] and [positive outlook] is another way of saying [life (ie the lives of humans in general) is good]
or: “If I believe that my life can be better, then I believe that life-of-humans-in-general is good.”
I’m not implying that you actually believe this, just that this is what you were saying “positive outlook” meant. Am I right? From this perspective a positive outlook seems like a non-sequitur, since the future quality of my life may not provide much information about the lives of other people. Not to mention the fact that some people have good lives with bright futures and some have bad, hopeless ones, so the notion of life-in-general seems meaningless. From this I conclude that I do not have a positive outlook.
I agree with the first interpretation if you replace produces with presupposes or is the sort of thing you believe if you have the feeling of.
I also didn’t mean that [positive outlook] involves people at all: I think it’s more of a feeling about existence in general. It’s true like you say that there is so much variety from one person to another and over time, and that [life in general] as a concept doesn’t make much sense when you really think about it, but that doesn’t stop us from having a feeling about it. We know that it’s silly to talk about whether chocolate ice cream tastes good in general, and yet if you have always loved chocolate ice cream, there is a strong feeling that the goodness is an attribute of the ice cream itself rather than a description of your preferences, which is what you believe when you stop to think about it. The feeling for chocolate ice cream is to the feeling of [positive outlook] as the thought of “I love chocolate ice cream” is to the thought of “my life can be better” (can be better as in “has no upper bound” rather than “has nowhere to go but up”).
I feel like I’m expressing myself so poorly that I should just stop before I confuse even more.
Hmm, good point. But is that a specific belief, or a family of beliefs parameterized over values of “good”? Still, it’s a subjective belief constraint, if nothing else.
I think it’s an attitude, which is a set of dispositions to think and believe (and thus act) in certain ways. The disposition can be represented internally as a belief, but it’s actually something more fundamental. The belief corresponding to an attitude is a representation rather than the thing itself.
To illustrate what I mean, consider people suffering from depression. Their primary problem in cognitive terms is not that they have particular dysfunctional beliefs (my life sucks, I’m a failure, etc.), but that they have a dysfunctional attitude that predisposes them to act in self-defeating ways and adopt particular self-defeating beliefs. They have an attitude that manifests as a strong predisposition to filter the positive, blow the negative out of proportion, and interpret every event in life in a way that would actually be cause for unhappiness if the interpretation were accurate.
Julian Simon’s Good Mood is a counterexample. He was seriously considering suicide once his children were grown—he had no pleasure in life and a high background level of emotional pain.
Still, he was running his life quite well, and got over his depression when he finally had everything squared away enough that he could spend a little time thinking about it. He concluded that depression is caused by making negative comparisons about one’s situation, and found a bunch of strategies (lower standards, improve situation, find something more important than making comparisons, etc.) for not making them.
The link is to the whole text of the book.
Oh, indeed. Well put.
Regarding self-fulfilling beliefs:
Yes, having a belief can have the side effect of changing your behavior independently of how you would consciously change your behavior in light of your beliefs.
When you have an accurate belief, and the side effects of believing it affect your behavior in a way you consciously believe is positive, then take advantage of it! If you can get a boost toward your goals without making a conscious effort, then by all means cut out conscious effort as the middleman in the causal chain between your beliefs and your goal state.
But if you spy a shortcut between an inaccurate belief state and your current goal, don’t follow the causal chain from the beginning, but meet it in the middle. Strive to shape your behavior according to your prediction of its effect, but leave your innermost beliefs to entangle with reality. They are shaped too much by non-entanglement processes as it is.
Good point. It might be that there are very few business ideas that actually are rational to have confidence in—otherwise, someone probably would have implemented them already. In other words, most business ideas, even the ones that turn out to be good ones, might be inherently bad gambles a priori.
It’s also possible that business ideas aren’t actually all that important, and that other factors dominate the success of a start-up. I believe this is essentially Paul Graham’s position, for what that matters.
I think the best approach is a slightly more sophisticated one: commit to the belief that there is a way to succeed and you will find it—but not necessarily that you have already found it.
were it a guarantee, it would not be irrational
But is it also true that 80% of entrepreneurs fail? I was under the impression that yes, 80% of startup companies fail, but the average entrepreneur might start five or more companies over his career, so that average success rate per person is much higher than 20%.
Interesting question. It would be useful to know what the real statistics are. We certainly know that some successful entrepreneurs start up several companies, and that some of them have multiple successes. But it’s harder to find reports about serial failures. I think I’ve read that (successful) VCs don’t count prior failures against CEOs they’re considering funding, and sometimes the people they place in funded companies are experienced with start-ups, but haven’t had any big hits yet.
But for most people, I think the real question is what type of start-up to join, not whether to start one of your own. The vast majority of people at every successful company weren’t founders, and weren’t even early joiners. I think for relatively young workers, joining a succession of promising start-ups may be the right way to spread your chips around. Stay for 3-5 years (and work at it with all your heart and mind) and after that much time, if it doesn’t look like blistering success is just around the corner, move on to another opportunity. As you get older (and don’t have a big win under your belt) it probably makes more sense to take a lower chance on the big win in order to get more current income.
Agreed. History is written by the victors; just as evolution’s path is paved with the untold number of those which died for lack of fitness or simply luck.
That which is successful and remains eventually isn’t representative of all that has been attempted. Especially when those attempts have been made with little planning, knowledge, method, or even, when they’ve simply been made at random or based on beliefs that weren’t entangled with reality. Holds true of any optimization process.
The less intelligent and “rational” the process, the more trashed byproducts to be quickly forgotten.