Decision-making strategy from VC Patrick McGinnis

Patrick McGinnis is a VC who makes some of his more
important decisions using a strategy similar to writing an
investment memo.
Courtesy of Patrick
McGinnis

• Entrepreneur and investor Patrick McGinnis discussed
  how “Fear Of Better Options” can lead to being overly hesitant
  in taking decisions in an
  interview with The New York Times’ Tim Herrera.
• For big life decisions, McGinnis applies the kind of
  approaches he does when evaluating a potential investment as a
  VC.
• He writes everything he can think of down, then reads
  it out loud, “like writing an investment memo for a V.C.
  investment.”

Making big decisions can be scary, but one Wall
Streeter-turned-VC has a good strategy to overcome paralysis
based on his experiences as an investor.

Patrick McGinnis is an entrepreneur, investor, and the author of
the book, “The 10% Entrepreneur: Living Your
Startup Dream Without Quitting Your Day Job,” in which he
describes
strategies for balancing starting a new venture on your own
while also keeping the security of a steady career.

McGinnis was recently interviewed by
The New York Times’ Tim Herrera on the concept of “Fear Of
Better Options,” or “FOBO,” which McGinnis coined to describe a
type of mental paralysis that can happen when making a decision.

The basic idea of FOBO, according to Herrera, is that one might
be overly hesitant to take a pretty good course of action if it
means foregoing some other hypothetical better course of action.
The problem, of course, is that holding out for that better
hypothetical could mean losing the good opportunity at hand.

McGinnis shared a couple of strategies he uses to overcome FOBO
with Herrera. For making important life decisions, McGinnis said
he relied on the kind of analysis he takes when evaluating a
potential investment as a venture capitalist:

“For the big things, I try to think like a venture
capitalist. I write everything down on the topic — pros, cons,
etc. — and I read it out loud. That process is basically like
writing an investment memo for a V.C. investment, but in this
case the investment is of your time, money, energy, etc.”

McGinnis also described a quicker and simpler process for
more day-to-day, less momentous decisions, which he called
“asking the watch.” He told Herrera:

“I whittle something down to two options and then assign
each item to a side of my watch. Then I look down and see where
the second hand is at that moment. Decision made. It sounds
silly, but if you try it — asking the universe — you will thank
me.”

Read the full interview at The New York Times »