This will make you a better decision maker | Annie Duke (author of “Thinking in Bets” and “Quit”, former pro poker player)

Annie Duke is a former professional poker player, a decision-making expert, and a special partner at First Round Capital. She is the author of Thinking in Bets (a national bestseller) and Quit: The Power of Knowing When to Walk Away and the co-founder of the Alliance for Decision Education, a nonprofit whose mission is to improve lives by empowering students through decision skills education. In our conversation, we cover:

• What Annie learned from the late Daniel Kahneman

• The power of pre-mortems and “kill criteria”

• The relationship between money and happiness

• The power of “mental time travel”

• The nominal group technique for better decision quality

• How First Round Capital improved their decision-making process

• Many tactical decision-making frameworks

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Find the transcript at: https://www.lennysnewsletter.com/p/making-better-decisions-annie-duke

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Where to find Annie Duke:

• X: https://twitter.com/AnnieDuke

• LinkedIn: https://www.linkedin.com/in/annie-duke/

• Website: https://www.annieduke.com/

• Substack: https://www.annieduke.com/substack/

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Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

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In this episode, we cover:

(00:00) Annie’s background

(03:53) Lessons from Daniel Kahneman: humility, curiosity, and open-mindedness

(09:15) The importance of unconditional love in parenting

(15:15) Mental time travel and “nevertheless”

(20:06) The extent of improvement possible in decision-making 

(24:54) Independent brainstorming for better decisions

(35:36) Making sure people feel heard

(42:41) The “3Ds” framework to make better decisions

(44:49) Decision quality

(55:46) Improving decision-making at First Round Capital

(01:05:05) Using pre-mortems and kill criteria

(01:10:15) Making explicit what’s implicit

(01:10:55) The challenges of quitting and knowing when to walk away

(01:19:23) Where to find Annie

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Referenced:

• Daniel Kahneman, Who Plumbed the Psychology of Economics, Dies at 90: https://www.nytimes.com/2024/03/27/business/daniel-kahneman-dead.html

• Adversarial collaboration: https://en.wikipedia.org/wiki/Adversarial_collaboration

• Does more money correlate with greater happiness?: https://penntoday.upenn.edu/news/does-more-money-correlate-greater-happiness-Penn-Princeton-research#

• Income and emotional well-being: A conflict resolved: https://pubmed.ncbi.nlm.nih.gov/36857342/

• Strategic decisions: When can you trust your gut?: https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/strategic-decisions-when-can-you-trust-your-gut

• Cass Sunstein on X: https://twitter.com/CassSunstein

• Dr. Becky on Instagram: https://www.instagram.com/drbeckyatgoodinside

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