Startup Funding Espresso Probabilistic Thinking
Probabilistic Thinking Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. Probabilistic thinking is making an estimate using math or logic to determine the likelihood that an outcome is going to happen. This often involves statistics and historical data. If the revenue in a company has grown by 10% for each of the past five years, then probabilistic thinking will point to a growth rate of 10% for the coming year. Founders can use probabilistic thinking also for uncertain situations where there is little historical data.\xa0 In our example, for estimating the revenue in the first year of a company without the benefit of a track record, we can use probabilistic reasoning. In this case, we can use logic to estimate the revenue. For example, we could look at similar companies to see what revenue they generated in their first year.\xa0 In applying probabilistic thinking, consider all the options.\xa0\xa0 Expand your focus on what is probable to include what is possible. Gather additional information to tune the probabilistic estimation.\xa0\xa0 This is called Bayes Theorem which incorporates new and relevant information into the decision-making process. Apply probabilistic thinking to your startup decisions. \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 .