There are two types of decisions that founders make: (1) data-driven decisions, and (2) decision-driven decisions.
Decision-driven decisions are decisions that are based on what the founder believes is right. These are not necessarily decisions that founders want to make, but ones that they feel compelled to make. They feel like it’s the right thing to do.
Data-driven decisions are ones that rely on data and market research. These decisions are usually less controversial and more consensus-driven, but they don’t always lead to the best outcome.
Founders who make data-driven decisions tend to be much more concerned with building consensus and pleasing others. Founders who take decision-driven decisions tend to be much more focused on getting things done and achieving their goals, even if it means alienating others in the process.
It’s not that one is better than the other, but rather that both are necessary. Founders who only take data-driven decisions will get mired in consensus-building and will lose sight of what they’re really trying to achieve. Founders who only take decision-driven decisions risk being too stubborn and focused on their own goals at the expense of everyone else.
In order to be successful, founders need to strike a balance between these two approaches, while also recognizing when it’s time to ignore the data and trust their intuition.
How Data-Driven Decisions Can Limit You:
The startup ecosystem is all about data and consensus. Founders spend countless hours in office hours trying to make sure that they have a viable product and business model, followed by endless days in pitch meetings with investors and potential customers asking for validation.
The culture of startups is all about convincing others that you have a good idea worth investing in or working on, which can be extremely challenging for anyone who doesn’t like selling or networking.
It’s not easy to be comfortable with putting yourself out there and selling yourself or your ideas. As an introvert myself, I know this all too well!
In order to get to the point where you’re ready to pitch investors or potential customers, founders need to do a lot of research and gather a lot of data.
This is often the only way that they can convince themselves that they have a viable product or business model.
As a result, founders spend most of their time and energy collecting as much data as possible. They attend office hours, talk to mentors, join user groups, talk to potential customers, etc.
While this approach has its merits (i.e., it gives you more confidence), it can also limit your ability to make decisions and move forward when you don’t have enough data.
It becomes very easy for founders to lose sight of what they’re really trying to achieve in the process of collecting data.
It becomes easy for them to think that “it’s not worth moving forward until I have more data on this” when in reality, they may already have enough data to move forward with their decision!
How Decision-Driven Decisions Can Limit You:
The problem with decision-driven decisions is that they are based on your intuition and not necessarily on what the data is telling you.
These decisions can be risky because they can be based on your own biases or preconceived notions of what the data should be telling you. It’s very easy to make decisions that are “good enough” rather than making decisions that are based on objective reality.
Founders who take decision-driven decisions often rely on their gut instincts and personal preferences to make decisions.
They have a hard time thinking about their startup in an objective way and believe that their decisions are always right, even when the data suggests otherwise.
This is dangerous because it can lead to very poor outcomes, especially if you ignore or dismiss negative feedback.
The most successful founders tend to strike a balance between data-driven and decision-driven approaches.
They gather as much data as possible but don’t get mired in consensus-building for too long.
They trust their intuition but also pay attention to what the data is telling them at all times.
They know when it’s time to push forward and ignore negative feedback, and they know when it’s time to listen to feedback and reevaluate their approach accordingly.
The Importance of Trusting Your Intuition:
Intuition is defined as a feeling or impression that something is true, right, or real. This feeling can be hard to describe, but it’s often a very strong sense of knowing that something is right.
The most successful founders are the ones who trust their intuition and ignore the data when they feel like it’s not right.
These are the founders who believe in their product and know that they have a good idea worth pursuing.
They don’t need validation from others because they already have confidence in themselves and their product.
They aren’t worried about what others think because they already know what they want to do.
They aren’t concerned with data because they have enough of it to move forward with their decision (even if it doesn’t look great).
These are the founders who push forward with their decisions even when everyone else tells them otherwise.
These are the founders who are unafraid to ignore advice from mentors and advisors because they know that it’s right for them and their startup.
These are the founders who will spend money on an expensive design agency even if everyone else tells them not to do so.
These are the founders who will hire a head of sales even if everyone else tells them not to do so.
And these are the founders who will double down on their vision even if it means making sacrifices and losing their friends.
The ability to trust your intuition is extremely important because it can lead to positive outcomes that would not have been possible otherwise. When you’re making decisions, you need to make sure that you’re not being overly influenced by what others think.
This doesn’t mean that you should ignore feedback or shut yourself off from others, but rather that you should be careful about relying too much on feedback from mentors and advisors when it doesn’t make sense for your startup.
When making decisions, founders need to strike a balance between data-driven and decision-driven approaches.
Founders who rely too much on data or consensus-building will lose sight of what they’re really trying to achieve, while founders who rely too much on intuition will risk alienating themselves from others and limiting their ability to achieve their goals.
The most successful founders are the ones who can balance these two approaches while also trusting their intuition when necessary.
About the Author
I am the Founder of Cudy Technologies (www.cudy.co), a full-stack EdTech startup helping teachers and students learn better. I am also a mentor and angel investor in other Startups of my other interests (Proptech, Fintech, HRtech, Ride-hailing, C2C marketplaces, and SaaS). You can also find me on Cudy for early-stage Startup Founder mentorship and advice.
You can connect with me on Linkedin (https://www.linkedin.com/in/alexanderlhk) and let me know that you are a reader of my Medium posts in your invitation message.