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Life Math: Compound Interest

I read this quote a long time ago and it has stayed with me "compound interest is the most powerful force in the universe." The saying is commonly attributed to Albert Einstein, but after Googling it doesn't seem very likely Einstein ever said it. Regardless of where it came from; today, I linked it to a new meaning.

I've been thinking about how to define entrepreneurship, or more broadly how to describe the entrepreneurial mindset. One way that has resonated with me is efficiency in leveraging current resources. Or simply, making more out of what you have right now. Then repeating the process many times over. The result is compounding returns, which are quickly very rewarding. When evaluating how entrepreneurial someone is, one route is looking at what they have been able to accomplish so far through the lens of what resources they had at the time.

This will only get you so far, as some people are not able to continue compounding the returns. Some people are great at getting new companies or projects off the ground and then not the right people to take them from a small to medium scale. On the other side, some people are great at scaling companies or projects but their strong suit is not getting them started from scratch. Making sure the right people are involved at the right time is tricky. Ben Horowitz discusses this extensively in his book The Hard Thing About Hard Things.

Determining the life cycle of a company you are most capable of contributing at is a really helpful lens when thinking about your career. I've recently determined that mine is in the earliest stage of a company where it is just a few people looking to get an idea off the ground. 

In other areas of life "what you made out of what you were given" is often something I am interested in learning about when I meet somebody. And a question I often ask myself is "how can I use the position I'm in now, to get more of the things I care about?" This sounds a little crazy, probably because your mind probably jumped to money. Don't think of it in the context of money and it feels a lot better. For example, "How can I use the things I have today to show my partner just how much I love them?" or "How can I leverage my volunteer time into affecting the most change for our cause?" 

Think about what limited things you have and how you use those resources today to drive the results you want. People who are good at this are often very successful.

Be Happy and Improve the Ability of Others to be Happy

The other day somebody asked me "If you had to, what would you say the purpose of life is?" The answer I chose is "to be happy and improve the ability of others to be happy."

We all share the human condition. Some of us started life in a really great place, while others were dropped in chaos and suffering. None of us got to choose and I can not think of a better notation of meaning than helping our fellow travelers make the most of life.

What a wonderful opportunity we are given, be happy and improve the ability of others to be happy.

Work Backwards

David Brown reminded me of a great piece of advice a couple weeks ago. Advice that in and of itself is totally obvious, in retrospect. It is: work backward. Start with picturing the result you want and in your mind work back to the present. Visualizing the path and thinking "what can I do now, to get closer to this goal?"

The mental exercise can result in many possible paths for achieving an outcome. I believe it is important to not just pick one of those paths and stick to it without any deviation. As new information is learned the best path always changes. Dynamism is important. The exercise is more useful to get a range of possible ways to achieve an outcome.

When I can visualize realistic paths to a goal, something that once seemed impossible and lofty feels attainable. This helpful for me to establish confidence in the things I am doing today.

Warm Day in Boulder

Today was a very warm day in Boulder. It was 50 degrees for most of the day and we still have about 5 inches of snow on the ground. I made full use of the warm weather and hiked all day.

I started off in the morning with Green Mountain Loop

View from the top

And then went on a run (mostly walking tho :p) from Flagstaff to the top of Sanitas Valley Trail.

Made it back to the car just in time for sunset.

In total I went 10 miles and 4,000 ft up.

Choice Fatigue

Choice fatigue is a phrase I've been using lately to describe the situation when a decision has to be made between many good options. In this case, it is difficult to make a decision. Not because a good choice is hard to find, but rather because the worry of not making the absolute best choice holds back any decision. When the difference in the quality of the options is marginal, the time lost trying to make the best decision can outweigh the marginal improvement gained by the best option.

Choice fatigue can also play a role in product design. For example, Amazon helps their customers avoid choice fatigue by naming only 1 item in each category the best selling item. So when users search for a product like "reading lamp" they aren't given 100s of results with only a marginal difference in quality and no easy way to distinguish between them. Instead, they are given assistance picking "the best" option by labeling it as the #1 best-selling product in that category. This prevents users from becoming too fatigued by the options and therefore unable to decide.