Imperfect information is more fun


I had an epiphany yesterday related to chess and entrepreneurship. I figured out why chess makes me so frustrated and why when I picked up chess in the pandemic, my chess rating hit a plateau above average, but no where as high as I expected.

The problem is that chess is a game of perfect information. The challenge isn’t in predicting the next few moves. The challenge is in finding the best possible move (or at my level, one of the top three moves) out of a collection of options so vast that there are not enough atoms in the universe to count them all.

That may sound exaggerated, but the reality is that there are so many possible unique chess games that 10-12 moves into a 30-40 move game, two amateurs are likely playing a game that has never been played before.

There aren’t any fewer possibilities when it comes to decision making in startups, but the difference is that for entrepreneurs (and startup investors) only have an imperfect view of the world, with no chance of knowing everything needed to make the best decision.

I have three decades of experience playing that game, and I’m good at that game because I’m not scared of the idea of making decisions without having an ideal or complete set of facts.

And that was the trigger of the epiphany, that I plateaued in chess because I’m comfortable trusting my gut in a minute or two rather than spending 2-3 minutes calculating five or more moves forward. All that calculating gets tedious, especially as you are not supposed to breakout a spreadsheet or other tool to make that process easy.

Ultimately this is the divide between those that love chess and those that don’t.

The lesson for entrepreneurs (as there always seems to be a lesson for entrepreneurs) is that if you are the type of person who gets paralysis from analysis, you probably love chess and get frustrated in business. If on the other hand you are comfortable with limited information, you’ll probably find entrepreneurship a lot more fun, as that is the core of that game.

By "Luni"


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