Be Allergic to Sunk Costs 🤧

Hey everyone,

A couple of weeks ago, I was on a Zoom call with Steph Smith, who runs Trends at The Hustle (the awesome publication I mentioned last week). Steph recently wrote an ebook and the call was one of the live sessions she offered as part of buying the book early.

During the call, someone asked Steph for three pieces of advice she’d give herself, and I found them interesting because they were somewhat in opposition to the ideas I discussed a few weeks ago in The Odyessey Plan, which involves doing three iterations of a super-detailed 5-year plan.

Steph’s point was that if you plan out too far, you’ll eventually discover information that will change what you used to think was true. She advocated being “consistently open to integrating new information so I make sure I’m moving in the right direction.”

On a related note, Steph encouraged us to “be allergic to sunk costs.” Often, we’ll continue with a course of action because we’ve already invested time, money or effort into it, and changing course would, in our minds, render the previous effort useless. But we’ll miss out on the value of a new path if we stick to the first plan no matter what. The reminder is to be aware of when sunk costs are influencing our decision making.

I think the Odyessey Plan is open to integrating new information, but it was enlightening to hear a take from the other end of the spectrum. And it’s a stark reminder for big planners like me.

Pete’s Picks ✅

  1. What I’m Reading: The Queen’s Gambit on Netflix has been getting a lot of hype lately, though you may not know it was a book first. I found this article about the life of the author and the novel’s background pretty interesting - it seems much of the story is semi-autobiographical.

  2. What I’m Watching: The Crown Season 4. The Crown is probably my favorite Netflix series. I’m already loving the new season, which came out today and portrays the royal family in the 80s, including Princess Diana and Margaret Thatcher.

  3. What I’m Listening To: I’ve listened to this episode of the Indie Hackers podcast several times in the past couple weeks. Featuring Daniel Vassallo, it details how and why Daniel left a $500K/yr job at Amazon to take a chance on working for himself. Really interesting stuff if you’re at all interested in entrepreneurship or lifestyle design.

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