all experience to a specific degree because it has to do with our cognitive biases. There's something called the Dunning-Kruger effect, which is basically when you know a little bit about something, you begin to think you're an expert and you're more confident than you should be. And what happens is, the more you learn about that something, the less confident you become because you realize there's so much more to learn and you're much more aware of it instead of having a false confidence that affects your performance. Founders will often come to me and they'll feel a little insecure like they already should have known something but they feel bad that they don't and that's quite okay. But when you become a wantrepreneur and you start puffing out your chest and saying no, I completely knew that and then still ask me to help you, that's when this cognitive dissonance starts to set into place and Dunning-Kruger effect becomes very damaging to the advisory relationship and to all the other founders that you're going to be working with. But the Dunning-Kruger effect is actually natural because we get this sort of dopamine high when we learn something and we feel a little bit competent, we want to expand that competence into the confidence that we can continue to learn and grow. But we also want to look good and so we avoid looking bad and so not knowing something could potentially reveal us as not having all the answers, looking bad and therefore we don't look good. So sometimes we start to get into this echo chamber in our minds and we puff ourselves up and we become overconfident. And this happens with pitch decks all the time. VCs will tell you that what happens is founders come in with much more confidence that their startup is going to become a unicorn than evidence to back it up. And whereas founders say, well, what about all that I know and what I've done up to this point in time, all my blood, sweat, and tears, the investors say, that's great, but we can't underwrite that. We need to see evidence and proof and then we get into something called the five stages of grief. For founders, grief look like this and remember every early stage founder feels this. I experience the five stages of grief all the time as I go through different cycles. But the first stage is denial and that's where Dunning-Kruger effect comes into play. Because we know just enough to be dangerous, we move into denial of the things that we don't know. We think, of course I'm going to raise $1 million for my startup. I'm an amazing genius. Of course this is the best thing since sliced bread. Of course nobody else is working on it. Of course investors are going to see it a mile away and start writing me checks. Now I'm being a bit facetious. It's actually a little more subtle than that. We start to dream about an investor recognizing who we are and writing that check because we want to and we have to be confident. We have to have conviction in our ideas. But when we hit the reality that it's not what it seems, that we're not actually right about something, we start to get angry. And this is a natural reaction everybody has. And I've had founders emotionally all their anger onto me and it's affected our relationship. But as I became a better advisor, I understood that this was a natural reaction and I actually became glad that I could share this moment with them. It's led me to my thesis, Joy Effects which I won't get into here, but that's when we're glad to be with each other in strength and weakness for network effects. And that moves to bargaining, which is the next stage. That's when we start negotiating with ourselves and with other people and we start to think, oh, if I just change my ask or change the terms or if I move from a convertible to a safe, that's going to change everything and it's just not the case. We have to move through the stage as quick as possible, which inevitably leads to depression. We get sad. We start to think we're really bad founders. We go into that trough of sorrow. Once again, it's completely natural. I've been in this stage where I've wallowed and literally locked myself in a room and not see my family for like two weeks except for meals. But if we can surround ourselves with the right people, then we can move past it and get to acceptance and that's when magic starts to happen, especially between you, other fellow founders who are in the same stage of acceptance, and your advisor. We all work together extremely well. Sometimes this feels like going to war with other people, but you realize that you're fighting back to back and you're in the same battle. I've had this with groups of founders as I worked them through their pitch deck and their narrative. At first, they start off with fully believing that they've got the goods and then I have to give them the letdown. We start having arguments, there's a lot of tension, but as we push through the stages together, sticking with each other, having each other's backs, we get to the stage of acceptance and that's when productivity goes to the next level and we start to see a light at the end of the tunnel and we come out to something that everybody can agree with. But a lot of times founders stay stuck in anger and they start blaming everybody else. One example of this is attacking VC. Some founders get really upset because VCs are rejecting them and they get mad at the entire VC industry. And then they point the finger at someone to blame because again, it's a natural reaction and sometimes that finger gets pointed to me. I fully recognize that as an advisor, I have the luxury of pointing the finger to the problems in somebody else's startup that I wasn't a part of creating. But that's what I bring to the table as an advisor. I bring an external perspective, someone who can go arms distance and who's not stuck looking at the forest and not seeing the trees. I can look at the whole forest and that's why I respect founders. It is one of the hardest positions to be in. Being the CEO of your own startup is a lonely position that many people don't understand and I empathize. I've made decisions that have caused catastrophic failures and adverse effects to all the people around me and I've looked like a total buffoon, a completely inept, incompetent leader. And I've been embarrassed I felt the shame and I've been angry at everyone else around me when I'm not willing to look inwards. But if you know a founder who's blaming everybody else instead of taking responsibility for what they control, that is very dangerous. That is slowly going to seep into you and start to infect you. It's like toxic radiation. You do not want to be around that whatsoever. And unfortunately, a lot of this is collected in social media because they start to gin up that anger and it becomes a mob and it becomes really easy to join in and that's what establishes that culture which invades all the other aspects of your startup life. This gets worse by an order of magnitude when that individual starts to exhibit narcissistic traits. And unfortunately, I know founders where I have completely rejected them. I fired them right on the spot because they've come at me right in the first conversation because they're already in that anger state. And believe you me, they still come after me and they yell and they kick and they scream and I say, get in line with all the other people who are completely disappointed with my advisory abilities. When the reality is I'm not the one who's supposed to be taking responsibility. Now I will take accountability for my part if I've contributed in any way and I'm willing to go through the reconciliation process and take ownership of my part, but it only goes so far. If you allow that inappropriate anger to become toxic and seep into your own personal founder circle, your own emotional life, then you are in trouble. It's like a cancer. You need to cut that out and be absolutely brutal with it. Don't worry about other people's opinions. You're doing this for you because you will not be useful at all for your startup and unfortunately for all the people that you care about in your life. Individuals like this, especially those who exhibit those narcissistic traits, I'm not saying they have narcissistic personality disorder, that's psychological label, that's not for me to give. But those who exhibit the traits similar to that, which many do, especially online, that is detrimental. Please be aware of this. I'm trying to be as serious as possible here because I worry about this a lot when it comes to what is happening in society in general.
