Definite Optimists create the Future
My first principle for being both Aggressive and Thoughtful is Conviction > Diversification. It is not only central to how I think about investing, but is core to how I think about making long-term plans for the future.
I've always been inspired by great leaders and visionaries who made bold bets to build a better future. When I was in middle school, reading about how Andrew Carnegie and John Rockefeller built the backbone of the modern economy with oil and steel inspired me to have a career in business and technology. However, it was not until 2014 that I had a framework for thinking about how to build the future.
Thinking about the Future
If you have spoken with me in person for any considerable length of time, you know that the single person who has been the greatest intellectual and philosophical influence in my life is Peter Thiel. Peter Thiel is the co-founder of PayPal, along with Elon Musk, and was the first investor in Facebook, buying 10% of the company in 2004 for $500,000. He is not only a successful entrepreneur and investor, but I believe he is the most important public intellectual in the United States today. Why? Because Peter Thiel gave an entire generation of highly ambitious individuals a mental framework for building the future.
While teaching a course on Startups at Stanford in 2012, he described a general framework for thinking about the future, that he elaborated on his seminal work, Zero to One: Notes on Startups, or How to Build the Future. He projects his framework into a 2x2 grid with two axes. On one axis lies Optimism vs. Pessimism and on the other lies Determinate vs. Indeterminate.
When you overlay these grids, you are left with 4 quadrants:
Pessimistic + Definite: "A definite pessimist believes the future can be known, but since it will be bleak, he must prepare for it.”
Pessimistic + Indefinite: "An indefinite pessimist looks out onto a bleak future, but he has no idea what to do about it."
Optimistic + Indefinite: "To an indefinite optimist, the future will be better, but he doesn’t know exactly, so he won’t make any specific plans. He expects to profit from the future but sees no reason to design it concretely."
Optimistic + Definite: "To a definite optimist, the future will be better than the present if he plans for it and works to make it better."
Peter Thiel argues that we should strive to "understand the future and work to shape it". That we should aspire to be Definite Optimists. His own work demonstrates his commitment to his thesis. You do not make a big bet on a startup led by a 19 year old college drop-out unless you have absolute conviction they will succeed. Peter Thiel did not just believe in Facebook, he knew that Mark Zuckerberg would make more money than he ever could.
The Future is built by Definite Optimists
Definite Optimists are empowered by a way of seeing the future that maximizes their agency as individuals. Just as importantly, the courage and conviction with which Definite Optimists pursue their plans inspires the rest of us to help make their visions become reality.
The great visionaries of our time, the people who truly move us, Elon Musk, Jack Dorsey, Vitalik Buterin, and Satoshi Nakamoto are all Definite Optimists. Their conviction in their vision of the future moves the rest of humanity to help them succeed. These visionaries are more leaders of movements than managers of companies.
Steve Jobs inspired people all over the world because of the clarity of his vision and the conviction with which he pursued it. He could not have built Apple, the Mac, the iPod, and the iPhone by himself. His vision for personal computing inspired the most talented software engineers to work at Apple, long-term oriented investors to bet on the company, and consumers to purchase Apple's products.
My Definite Optimism
Conviction in my vision of the future has steered me through numerous, sometimes seemingly impossible choices in my life.
Conviction in my ability to teach myself data science is how I decided to forgo graduate school. If I had not embarked on that journey, I never would have stumbled into the Numeraire token launch that led to my discovery of Bitcoin and the Cryptocosm (this story is worth its own post).
I joined PrecisionLender over a larger company with an established data science team because of my conviction in its people, culture, and business model. That choice gave me invaluable opportunities to learn the business of software, create new data products, and help build an analytics team from the ground up.
Most importantly, the strength of my relationship with my high school girlfriend (now my wife) is how I chose to attend the University of Washington over an “elite” school on the East Coast. Reflecting on this decision a decade later, it was both the hardest and the best decision I ever made. I made the choice because I love my wife, and wanted to build my life with her. I was fortunate that my choice also saved me over $100k in student loan debt for an education, that in hindsight, most likely would not have been much better. Serendipitously, Seattle also turned out to be one of the best places for a economics student to be during the Great Recession. While Wall Street banks were shedding investment analysts, Amazon was hiring every capable analyst they could find in Seattle, and that’s how I got my start in technology.
What do you have conviction in?