Startup Funding Espresso -- Hindsight Bias
Hindsight Bias Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. The hindsight bias is defined by Wikipedia as the tendency to see past events as being predictable at the time those events happened. When an investor sees a\xa0 startup fail or succeed, early indicators come back to the investor's mind. In some cases, investors selectively remember certain events or facts that later confirm the outcome.\xa0 This can lead to overconfidence.\xa0 If one believes he can predict the outcome then he\u2019ll make mistakes erroneously thinking he can predict the outcome of any startup. Oftentimes, success or failure is a combination of factors such as market selection, timing, and team dynamics, and not just one facet of the business. To overcome the hindsight bias remember you cannot predict the future. Review the facts of the startup and not just how you feel about it. Write out your thought process including the facts at hand and the justification for making the investment. When the outcome of the investment becomes known, you can refer back to the notes to check your decision-making. Consider other outcomes aside from the one you expect and keep an open mind throughout the process. Build a decision-making process and focus on it rather than guessing the outcome.\xa0 \xa0 Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding. Let\u2019s go startup something today. _______________________________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0\xa0 For Feedback please contact info@tencapital.group\xa0\xa0\xa0 Please , share, and leave a review. Music courtesy of .