3 things today: psychological hacks of investor mindset

3 things today: investors (like other human beings) use mental shortcuts (called cognitive biases) in their decision-making process.

Top three shortcuts used include:

  1. confirmation bias (investors look for confirmation of their beliefs/values when evaluating startups and favour those with most “confirmations”)
  2. hindsight bias (investors think past successes of founders give them a good chance for a repeat success in future)
  3. bandwagon effect (investors jump on an investment opportunity that has other influential investors, advisors or founders with good track record).

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