Should I just flip a coin? It’s a thought I had to myself when deciding multiple job offers between big tech and growth equity. I had spent a week agonizing between the decision with about 24 hours left to make a call. I’ve observed that making decisions like these are tough for me because of broadly three reasons:
Opportunity costs are high. Choosing one thing often means giving up something else. Added complication is that options usually come in package deals rather than buffets. You usually win some and lose some with each option.
Decision are hard to reverse. Once a decision is made, it’s hard to go back. Put differently, it means giving up option value.
Uncertainty from incomplete information. There is always a level of uncertainty on how one option is going to play out against another. Information adds some certainty, but there is rarely enough time and resources to gather complete information before making a call.
These problems, I find, apply to just about every decision in my life from career to relationships to even purchases. The nature of these decisions is that simpler mental models like pros & cons comparisons and generalized advice from mentors aren’t as effective in helping make the decision.
Thinking like an investor
As a former venture capital investor, I made investment decisions with similar problems on a daily basis. There is limited time to conduct diligence and limited money to invest in companies. Investment decisions can rarely be reversed — it’s hard to liquidate shares pre-IPO if invested and hard to go back and ask for allocations if rejected. Companies are inherently risky investments with limited information to make the call. If there was perfect information, then the price of that asset would probably reflect that.
Here’s a few ideas that were helpful for me when making these decisions.
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