A couple of weeks ago I made a new friend. I met a guy in his late 30s – early 40s that has his very own hedge fund. While sipping on some beers and discussing everything from women to business strategy, my friend made an interesting comment.
He was going on about how he loves to work and how he is currently working on maximizing his efficiency; he wants to work as little as possible and make as much as possible. It’s a rather simple concept. He said that although he hoped to retire soon-ish, he at the same time felt that he couldn’t because the money that his company is gambling with is money coming straight from his wallet.
It’s very difficult to trust other people with your money — especially when you know how good you yourself are at investing it. So I asked him why he couldn’t start training someone to do what he does. Of course, he would need to continue to oversee operations, but he would be less active in the actual functioning of the hedge fund. His reply couldn’t have rung more true: “What I do is not something that you can teach. It is something that you are born with; it is in your genes.”
There are two main types of businessmen: those that are analytical and calculate each and every variable, and those that do things by their gut. It may seem almost counterintuitive, but the truth is that those that do things by following their gut-feeling tend to find more success than those that do things according to the book — if such a book were to exist.
There seems to be something innate in the concept of business itself that requires a certain raw, animal instinct of survival. Business is, after all, largely a street fight — the best fighters are those that are born with fighting instincts. When the pressure puts you in a tight corner and you have your back up against the wall, there is very little calculation that will come in handy.
When you are faced with two or three options and they all seem equally shitty, then logic goes out the door. When all that you have is your gut instinct and the need to make it out alive, those that are used to relying on their instincts are those that react fastest and are those that will survive to fight another day.
“Often the difference between a successful person and a failure is not that one has better abilities or ideas, but the courage that one has to bet on one’s ideas, to take a calculated risk — and to act.” - Andre Malraux
Risk is a scary thing. Most curl up and turn away from it while others live for it. Being a constant risk taker, however, is not something to be proud of. People that can’t help themselves but bet against the odds become avid gamblers, usually finding themselves in poverty.
But those that think before they take a risk and truly understand the risk that they are taking are those that end up on top. If you do not take risks, then it is impossible for you to succeed. Nothing worth doing in this world comes without possible failure.
The greater the possible success, the greater the possible failure tends to be. Having a great idea is a start, but unless you have the balls to sacrifice all that needs to be sacrificed in order to bring your idea to life, then an idea is a thing of little use.
Being an entrepreneur requires a combination of brains and courage. You can’t have too much of one, but not having enough of the other will get you in trouble. However, intellect and courage usually aren't enough to get you to take that leap.
Something else, something innate, plays a huge part in much of our decision-making. We make choices every minute of every day — most often without putting any thought into the actions. From what we should eat to what we should say, instinct plays a big part in deciding what we do and in shaping who we are. This instinctive decision-making is part of each of us.
But it is more prominent and fine-tuned in certain individuals. We sometimes feel that something is the right decision only because we feel that it is the right decision. We may not have any logical explanation for it and find that trying to put logic behind it is futile. Nevertheless, this level of instinctive decision-making that we are each capable of is the difference between a person who is a born fighter and a person that is better off staying out of the ring.
You must have a good grasp of your own capabilities. If you are the kind of person that likes to analyze each and every detail prior to making any decisions, then I would recommend staying behind the scenes, taking care of all the planning and finding a business partner that is better at thinking on his feet and making quick, gut-derived decisions.
I am a believer that each and every person is capable of achieving anything that they set their mind to — so it may very well be possible to better this natural ability of making decisions on pure intuition. The question, however, is whether or not spending all that time on improving your weakness to the point of bringing it to a competitive level with those that have a natural ability in the same aspect, is worth it.
Often at times it is wiser to focus on your strengths and only work on your weaknesses long enough to make sure that they won’t be the catalyst of your demise. Making decisions purely on a whim is stupid — unless accompanied by calculation and an understanding of the possible outcomes. If you aren’t one to trust your gut, then leave your boxing gloves at home.
Paul Hudson | Elite.