Annie Duke | Quit: The Power of Knowing When To Walk Away

Srini: Annie, welcome back to the Unmistakable Creative. Thanks so much for taking the time to join us. Thank you for having me back. It

is my pleasure to have you back. I always learned so much from talking to you. You are one of those rarefied guests who has appeared now for a third time. 

Annie Duke:  You know how they give people the jackets on Saturday Night Live, like the five timers club. I want one of those Velvet Jackets

Srini: We should get those made for our multi-time guests. Like you're in a league of probably 10 guests. It's like you, Danielle Laport and a handful of other people. There's not many of them. Oh, exciting that we have back multiple times. You have a notebook out, quit the power of Know England to walk away, all of which we will get into.

And as I was telling you, was my favorite of all your books so far. But before we get into that I was trying to think back to all the questions that I had asked you and went back and listened to this morning Yeah. To your previous interviews. Like what if I not asked you before? So I thought start by asking you what is the very first job that you ever had and what impact did that end up having on where you've ended up with your life in your

Annie Duke: career?

Hold on. Just like babysitting count.

Srini: Anything counts. I

Annie Duke: worked at McDonald's in high school. I also like real job with an employer. My first job is

Srini: McDonald's in high school. So

Annie Duke: yeah, guess Kentucky Fried Chicken. Oh,

Srini: okay. Cool. All right. What did you learn

Annie Duke: from that time? The time do, I don't, It was a while ago.

You had to wear like this brown polyester get up thing. It. It was really, it was growth . Yeah. But it was a job.

Srini: Yeah. But I don't know about you, but like when I worked in fast food, I had this really later in life. I appreciated so much what that taught me about how hard those people work, and just how much privilege that I was blessed with because it took me years to recognize that for me that was just a stepping stone on the way to college.

And for a lot of those people that was their daily reality. So I'm curious, what kinds of lessons did you learn that you recognized, maybe only in retrospect for that job?

Annie Duke: think it's similar. I, it was interesting, my, the way I got that job was because my father was a school teacher.

I Yeah. And at some point the school that he taught at started offering summer school it was like an advanced summer school from, for people around the country to come and do classes during the summer, probably to help them get into college. But when he first started working there, when I was young, they didn't have that program.

And so he didn't have any work during the summer. And so he got a job a temporary thing at a place called How Beef and Burger, which was, it was in New England. It was a very small chain in New England that was basically just like McDonald's. And he met a guy named Dickie Duggan there, who is one of those people that you're talking about, like he was my dad's somewhere around my dad's age, But he was working at how Beam Burger. And it was because that was his job. It wasn't like my dad. It was making money during the summer to sup supplement the teaching salary. So Nikki Duggan at some point got the manager's position over at Kentucky Fried Chicken.

And so when I was 14, my my dad called up if you Duggan and said, Hey can you hire my daughter? And actually my son, cuz my brother worked there too. Yeah. And that's how I, that's how I ended up there. And the thing is, it is actually really hard work. It seems like really silly, stupid stuff, but you had to memorize like what exactly what went into every single combination.

If it was a two piece box or a three piece box or whatever, you had to know. You had to be able to identify the pieces, know what went in there. And this was when the cash registers didn't work, do the work for you. So every single person who actually worked to cash register. Had to have all the prices on the menu memorized.

So that was part of your job. And they would quiz you on it and you also had to have the tax memorized. Wow. This was the, these people were smart and they worked really hard and the people who worked back in the kitchen we're standing over like oiling hot pots of oil with no air conditioning in the middle of summer.

Definitely makes you appreciate not only the value of hard work, but also that it's really nice not to have to do that kind of work too. And we ought to appreciate it. Yeah. remember exactly what you're talking about. Cause I've seen now the digital cash registers, but they just push a button.

Srini: And I remember we didn't have to memorize prices, but if anybody changed their order after they made like the whole thing finished, you had to call a manager over and have them fix it. It was such a nightmare. But the reason I brought up that particular question to start with was because I thought it was very relevant to the idea of quitting.

So my parents actually wouldn't let me quit after the first two or three months. They were like, No, you're gonna stick it out. And they made me stick it out for eight months. And then finally right around the time we were submitting our college applications, they were like, All right, you're done.

It's April, we'll let you quit. And I think that for me that was a valuable lesson in a lot of ways. Cause I don't think I would've learned what I did if I hadn't stuck it out for that long. Cause there were plenty of opportunities to bail out and I never took them. So I'm curious, like, when did you quit that job?

And how in the world did we arrive at this entire perspective on quitting? Because I think that like I said, this book has so many layers to it when we think about this idea of quitting.

Annie Duke: Yeah. So interestingly enough, like I didn't really I didn't really quit that job.

Because the job was only during the summer and I went to boarding school. So I did the job for the summer, which include like biking there, which was five, maybe 10 miles away or something like that. It was a long bike. It was like 10 or 20 miles. And then like school would start and I would be done working for the summer.

And then I came back the next summer worked again, and then the following summer I actually went and studied abroad. So it was just like the natural state of things. I didn't quit. Yeah. And I'm not sure, I don't think it ever occurred to me to quit that job because that was how I got my spending money for the year

Yeah. So it wasn't really, I don't think it was really an option. It at least not as I saw it. Look, here's the thing, what your parents had you do, which is stay in something that's hard. Yeah, because that's a good lesson. I don't really agree. I don't really disagree with, rather, Let me say that again.

What your parents had you do, which was like stay in something That's hard because there's like the lesson in seeing that there's a payoff, there are long term benefits to things and you shouldn't quit things just because you don't like them. Which is a bad reason to quit anything. I just don't like it.

Or it's hard. That's not a good reason to quit. I think that they were delivering a good lesson to you. The problem is that we overdo it. Because what happens is that we lose sight of the idea that what really matters when you're doing something is what are the long term benefits to this thing that I'm doing.

So the benefit of grit is that it gets you to stick to hard things that are worthwhile. But the problem is that when you take it too far, it gets you to stick to hard things that aren't worthwhile. It's up to the parent in your case to figure out what that calculation is about.

Like for shrin, Is this a good long term lesson for him compared to the other things that he could be doing with this time? Is there another job that he might be able to take? Or is this a good lesson to learn what it's like for most people to do this? All of those types of calculations?

I'm sure they thought it through and it seems like it was a good decision. But like I talked to somebody the other day who said my parents really wanted me to play a musical instrument. And so I got to choose the instrument and I chose the saxophone and it just turned out that like for some reason he hated the taste of the read in his mouth,

It was like super excruciating for him to have a read in his mouth. It was awful. Yeah. So he complained to his parents that he wanted to quit and they wouldn't let him because they said no this is a lesson, it's similar to what your parents said, but less well thought through. You need to do this because it's gonna build your character and you shouldn't just quit things that you start.

But he he could have played the trombone instead. It wasn't like he was saying, I wanna quit learning a musical instrument. He was saying, I wanna quit this instrument. Yeah. And they wouldn't allow him to because they went to that place where it's basically while grit gets you to stick to hard things that are worthwhile, it gets you to also stick to hard things that aren't worthwhile.

Yeah. And that's the thing that we need to pay attention to, is what's the difference between those two things? Cause too much of a good thing is a bad thing.

Srini: No. I was gonna ask you when it came to extracurricular activities when you were young, were there things that you quit?

Because I remember when the musical instrument example is funny cuz I played the tuba for almost 13 years and my dad actually won because he was a postdoc. He didn't have the money to buy an instrument, so he said, pick one that the school provides for you just in case you quit. Because otherwise that takes us into sunk cost bias.

They probably would've been really pissed off if I quit after sinking a thousand dollars into an instrument. So I was curious like, were there things that you quit when you were young and where is that line for kids in particular? You mentioned the saxophone thing, but because like you said, it's not a good reason just cuz you don't like it or cuz it's hard.

And often most people learning to play musical instruments sound like they're sacrificing animals.

Annie Duke: That's true. Although in this case, this, it was physical discomfort.

Srini: Yeah. Trust me, I played the tuba much to the dismay of my family and I was very committed to it, much to the dismay of my sister who hated it.

Annie Duke: Yeah. But that's okay cuz that's what your values were like. If you were committed, you were getting enjoyment out of it. Yeah. You know what, I wasn't so there was one thing that I really badly wanted to quit, which was the piano. So I, my mom, who was a beautiful singer and she played piano really well, decided to wanted me to do something musical.

And so she had me take piano lessons. Now you need to understands I'm tone deaf, , like whatever it sounded like when you played the tuba. What it sounds like when I try to sing a song it's just unrecognizable. I just so we're clear, I was good. I made Allstate Band and got into the USC School of Music.

In the beginning? In the beginning, Yeah. Yeah. In the beginning. Not eventually in the beginning. Yeah, that is true. Fair enough. Fair. You're the one who said you sounded like a screeching cat. So Yeah. No,

Srini: in the beginning. Of course, even when you're good, a tuba is not the most pleasant thing to listen to.

Oh, okay. Fair. Okay. So nobody wants to serenade their prom date with a tuba unless they definitely don't want to get late on prom

Annie Duke: night. Maybe that's the, maybe the one who wants to be serenaded is the love of your life. Maybe that's how you figure out they're your soulmate.

Yeah. Yeah. So anyway, so I, I took piano lessons and I remember this very well. I was eight years old. I went to my mother after a little while and I just, I literally said to her, Let's face it, I think we can both agree I'm never gonna be good at this. And I was being very very serious.

And she would not let me quit. In the service of building character, she's No, you have to start things that you have to keep doing things that you start, you have to keep with it. You committed to it. This is what you have to do. And man, I had to suffer through that piano for a freaking year.

And I didn't learn anything from it except this was dumb because I was really reasonable trying to explain that I wasn't gonna be good at it. And what I was trying to express, I'm sure not cuz I was eight is that even at that time I remember very clearly saying what a waste of my time.

That I'm doing this. And obviously what's implied by that is I could be using this time for other things. Yeah. So when my mother did finally allow me to quit, cuz it was an after school thing that I was doing, I started doing gymnastics instead, which is what I really wanted to do. And I stuck with that until I was 14.

Yeah. Until I went to school. Until I went to boarding school. At which point I did other sports. That's like really, like my main memory of thinking about a quitting decision or not was just like begging, like I was begging to quit because I was like, this is a waste of our time.

It's not something I'm gonna do for the rest of my life. I'm bad.

Srini: Yeah. I hadn't experience in college and I think this takes us nicely into sort of the book itself. I remember I was in college in the mid nineties when the internet was in its infancy.

Yahoo went public the year I graduated from high school. At a place like Berkeley in the Bay Area, everybody wanted to be a computer science major. I took one semester and somehow barely squeaked by, and then we got into the introductory computer science class and I think eight weeks into the class I was, it was very clear that I was gonna get an F in that class.

And I realized, I was like, Wow, I have no aptitude for this. What. But that's the thing realized is that so many people stick with things where they don't have any aptitude or any natural advantages. My old mentor used to say, he was like you have to look at both the probability and possibility of your success.

And he said, And the problem with a lot of the sort of personal development world which I think you just really expanded on beautifully in your book, was that we don't look at the probability and we only focus on the possibility of the outcome that we want.

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Yeah, I think that's, I think that's right. Look here. Here's the issue is. We quitting means failing. that's synonymous to what it means. And so if we haven't, like when we walk away from something, we just feel like it's, we're a failure. It like we feel like the loser let me say that again.

Quitting. Quitting means failing, right? It's like in the real sense, you could be doing something that isn't going well, but you could still turn it around as long as you keep doing it. And it's only that moment that you quit, that you have failed. That's the moment that you for sure like surely can't recover the cause.

And and regardless of that, like even if you quit something that's going pretty well, you still feel like you fail. Like somehow you didn't stick it out. And we can contrast that to grit, which feels like character building. And the heroes of the story are the ones who stick it out.

And then so then we have these objectives that we're trying to head toward. And if we haven't reached it, then that's the how do we ever walk away when that's the moment that we feel like we failed. think it's just, I think it's, I think it's becomes a very sticky problem Yeah.

For the way that we treat these two things and it causes us to stay in things that really aren't going well way too long. Which is really a tragedy because Yeah. We could be using all that time to do other things.

Srini: Do you open the book, Bob, with two different stories? And I'd love for you to share them.

You talk about Muhammad Ali, which I knew that story. I didn't know it in as much detail as you told it in. You tell us a bit about that because I remember thinking, Wow what a tragic ending to a.

Annie Duke: Yeah. So I think this is, I think this is a good example of the sort of tension between grit and quit, right?

So Muhammad Ali is the heavyweight champion of the world. He's beaten Sonny Liston at this time. He's Cassius Clay. And then he changes his name to Muhammad Ali cuz he, he converts to the Nation of Islam and the Vietnam War breaks out and he becomes a conscientious objector because of his religion.

So this was like super controversial that he refused to go and fight and he got tripped of his title. So he is no longer the heavy weight champion of the world and it nobody will license him. And he's basically suspended from boxing so he doesn't get to box for four years. And like boxing is a young man's game.

And so this is like a pretty crucial four years in his life. So once all of that resolves, he determines that he wants to be heavyweight champion of the world again. And it takes him four more years to even be able to get a heavyweight bout the a, a title belt. So by this time, he's like in his early thirties, which is pretty old for a boxer.

And so he worked his way up. He's got his title bout and it's against George Foreman, the Rumble and the Jungle, and George Foreman's undefeated. He's humongous. Nobody lasts more than like a round or two with him. Like he is a force. And so Ali's gonna go in and fight him. And Ali's an underdog.

Nobody thinks he can actually win. They all think that this is insane that he shouldn't be fighting this fight. And we know it happened he won. He won actually by changing his strategy. He used to be like float like a butterfly, sting like a bee. Like the whole thing was, it was very hard to hit him cuz he was so fast.

And then he would come in and hit you. But he was older now and he wasn't as fast and so he basically laid on the ropes and allowed George Foreman to pummel him until George Foreman got really tired. That's a big beating that you're taking cuz George Foreman's super big guy. So anyway, but he wins.

And I think that this is a, the good side of grit is that sometimes when you're really gritty it gets you to stick to good hard things that are gonna get you there. And sometimes you see other things things that other people don't see. So it's he's is like a symbol of the value of grit.

But here's where we get to the downside, that grit also makes you stick to things that aren't worthwhile anymore. He kept fighting. And it became pretty clear that he was experiencing really bad physical damage. So this isn't something, someone actually who just heard about, She, they hadn't read the book yet, but they had heard about the story, said just because he ended up with Parkinson's, which is what we know happened, isn't that resulting?

Because he couldn't have known that at the time, but that's not true because his fight, Doctor Furie Pacheco was telling him that he shouldn't be fighting anymore. They were looking at what was happening, particularly in terms of his kidneys, and it wasn't good. Like he just wasn't healthy enough to fight.

So Furie Pacheco basically says Dude, you gotta quit because your body is, it can't take this kind of beating. You're starting to experience really bad damage. And he tells that to Ali and Ali refuses to quit, and so Furie Pacheco quits. Because he just said, I don't wanna be around for this. And what he said is, I don't wanna be around.

When Ali comes up to me and doesn't know who I am, he doesn't know my name because he is taken such a bad beating. So he quits. Madison Square Garden, refuses to host any more of his fights because they're also aware of the physical decline and the damage. So this is all things that are knowable at the time.

But he keeps going. He eventually ends up in Las Vegas where he takes such a beating from Larry Holmes that Larry Holmes cries after the fight. It's, it was so upsetting to him. What happened then? Ali can't even get licensed in the United States, which is pretty remarkable because it wasn't really high standards to get licensed, but he can't, so he ends up fighting in the Philippines in some crazy.

Fight where like all the boxers had to share gloves and they were using a cowbell in bet. It was just, it was it's what you would expect. And some low rent unlicensed fighters fighting fighting in the Philippines, and then we know what happened. Like horrible physical and mental decline because he just really stuck around too long.

In a situation where people around him were very clear, like they were quitting on him because they were saying to him, You need to quit. And then when he refused they were walking away. This is the thing about perseverance versus quitting is that context matters as he was going towards George Foreman, he was physically healthy.

Was he older? Sure. But he hadn't there wasn't a lot of physical damage there. And while there were a lot of naysayers, his team was certainly on board with him and he probably saw something that other people didn't see. But the problem is that grit isn't good in all contexts, not even in the context of a very gritty person like Muhammad Ali, who's a managed to achieve amazing things because of his grit, because taken too far.

You can see what happens to him after the foreman fight. Yeah. And it's completely tragic. You

Srini: would go into the earlier chapter and you talk about this idea of turnaround times using climbing Everest as an example. And the one and only movie I've ever seen about Everest.

Everybody died, or basically got stuck on the mountain. I was like, Yep. Not on my bucket list to ever even think about climbing Everest. But you say that their turnaround times are there to prevent people from making poor decisions to keep going when they're in the shadow of the summit.

Building into a climbing plan. Three crucial concept. The first is that persistence is not always a virtue. The second is that making a plan for when to quit should be long done long before you're facing the quitting decision. And then third, and perhaps the most important is the turnaround time, which is a reminder that the real goal in climbing Everest is not to reach a summit.

It is understandably, to basically come back to the mountain and return safely to the base of the mountain. So why in the world do we even ignore the whole concept of turnaround times? Like, why does we, people even take people who take this into consideration? Yeah, a couple things. On the last point, which is the mo most important, it's not getting these decisions right.

Annie Duke: Has opportunity costs that are associated with it, which is why the goal is really to get back down safely. Because if you don't get back down safely, you can't experience all the opportunities that you would have in the future cause you're dead. That's true of anything, right? If I'm in one job, that means I can't be holding other full-time jobs or so and so forth.

So like any time that we have our attention on something that we're pursuing, something that's costing us the ability to do other things with that time and attention. So that's what the turnaround times are trying to get you to understand is that when you start up the mountain, there are certain things that you're trying to gain right? Doing something that no other person has done before. And there's certain things that you're sacrificing, like your physical comfort, there's money that you're sacrificing but the gains you're predicting. The benefits outweigh the costs. But there's a point when you're climbing where that calculation can shift, where the costs now outweigh the benefits.

So one of those, for example, could be like, if a blizzard comes in then you probably shouldn't start for the summer when there's a blizzard because the calculation has changed. But it turns out that another thing just has to do with time, which is you don't wanna descend the mountain and get to what's called the southeast ridge, which is like this real, really narrow spot on the mountain, which is very dangerous.

If you're in Dar, no. And so when you summit on Summit Day, 1:00 PM is the turnaround time, and that's all that means is that no matter where you are in the mountain, it doesn't matter if you reach the summit or not, you have to turn around at that time so that you aren't encountering the southeast ridge in the darkness.

Because they've figured out that's the time that the equation shifts. Where the costs now weigh the benefits. So this is something that they employ in mountain climbing. People don't always follow it, but they're more likely to. And interestingly enough in the movie, the one movie that you saw where you said everybody died or got stuck up there, there were three people who did not, and there were three people who followed the turnaround time.

Yeah. Their names were Dr. Stewart Hutchinson, John Teskey, and Luke Siski. And they turned around at 11:30 AM because they figured out that it was still three hours to the summit, so that was gonna be two 30, which was well past the turnaround time. So they might as well just turn around now. Yeah. And they were in that expedition.

But we don't even remember them. Even though they were in the movie that you saw and they were in the book that was based on called Into Thin Air by John Crack Hour. Yeah. Okay. So that's just a long way around to your question of why don't we just have these kinds of turnaround times as a general rule?

And I think the reason is that, Sorry. I think the reason is that we have an intuition. Trina, you can tell me if you have this intuition that after we start something, if there are really clear signals that we now encounter after the fact that would tell us that we should quit, that we will like, obviously right? If you're climbing a mountain and a snowstorm comes in, you're gonna turn around duh. Why wouldn't you? If you take a job and it turns out that your boss is toxic, obviously you're gonna go look for another job. Like it just seems so incredibly obvious to. That we would pay attention when things aren't going well.

If you're if you have a project at work that's now over budget and delayed and it doesn't look like that's gonna get better anytime soon, obviously you're gonna notice that and you're gonna shut the thing down. So that's our intuition. But decades of science, particularly science from someone named Barry Sta, who's brilliant guy, has shown that's not true.

Yeah. It just isn't true at, in fact, it's not just that we don't do the thing that we think we'll do, which is walk away when we get those negative signals, but we actually will like, escalate our commitment to the cause we double and triple down on it. We become more committed to the thing that isn't going well, which is just so confounding.

It's so against what our intuition is. , Excuse me. No worries. I hope you're okay. Yeah, I'm fine. Okay. It's just confounding because it so completely blows up what our intuition is about what we do in those situations. And that's why we need turnaround times. Because we have to realize that we can't trust ourselves in the moment to make the right decision.

So we have to think about it in advance and basically say what are the conditions under which I would stop? Which is what a turn if it's 1:00 PM I have to stop, I've gotta turn around. And by setting that in advance, you're just much, much more likely to follow through.

Srini: It's funny you say that because we planned, tried to plan three conferences.

The first one was a stunning success. The second one was in abysmal failure. And I went past the turnaround time. The third one was in 2019. I remember it was right around Thanksgiving, Christmas, and we had sold maybe 25 tickets. And I remember thinking, You know what, I've done this before. I know how this goes.

And I know that I can, I, it took me losing about $2,000 before I pulled the plug, cuz I was like, Wait a minute, we're not gonna sell 500 tickets by April. This is ridiculous. And I pulled the plug before Christmas because I remember the last time we attempted it, my whole Christmas vacation was ruined.

Trying to make this thing succeed. And so I remember somebody was like, Oh, you need to be energetically invested. I was like, That sounds like a bunch of new age horse shit. I'm like, you know what? That I'm like, I'm financially invested, I'm sorry, but you can invest your energy, but my money is on the line here.

And I

,

pulled the, And I guess so I guess the question for me is, so somebody wants I think the counter argument that some people will make is Oh, if you say, Okay, I'm gonna quit at this point, it becomes almost a self-fulfilling prophecy. Which that's a, I don't entirely agree with that, but I'm just curious what your take is on that?

Cause you're talking about the states and dates

Annie Duke: idea, right? I I hate this because I think that's what people say too about "don't have a backup plan. If you have a backup plan, you can't possibly succeed: that's ridiculous. So I'm guessing with the second one, with the second conference, that looking back you realize that there were early signals that was, which I be a loser, that you did not, I didn't pay attention to. Of course not. And so now the third time comes around and you, he those signals down doesn't mean that you weren't trying, Of course not. This is the thing that we need to understand. It's if I start a project and I say, Okay, if I'm not in this particular state by this particular date or time, I really need to shut this down.

Does it mean you're not gonna try to make it succeed? That's absurd. Yeah. Because you want to be successful. You want to do the right thing. You want people to see that you're accomplishing big, audacious. Audacious goals, and achieving those things. The idea that you have such a low opinion of humanity, that if you somehow give yourself an exit door, or not even, first of all, giving yourself an exit door doesn't mean you're gonna walk through it, which I guess is what people think about the backup plan.

Yeah. Make sure you have no safety net beneath you. Oh my God, what bad advice to give people. You're gonna leave them with no option if it doesn't work out. I'm pretty sure that's gonna make them keep playing on the field when they have a concussion. Yeah. Which is so damaging to them.

But even like with that door, if you just have a list of things like, like only pull this in an emergency, right? And here are the things that mean emergency, that somehow that means you're not gonna try, you're gonna sit idle in the room. Yeah. It's just, it goes against everything that we know about human nature.

So coincidentally it doesn't make, that doesn't make any sense.

Srini: And coincidentally, right after we pulled the plug in that thing, the

Annie Duke: pandemic started well, which is Yes. That would be coincidental. So we should not pat ourselves on the back for that. Yeah. But we should pat ourselves on the back for it, is that you looked at the first time that you failed and said, Man honestly, there were a lot of signals that was gonna happen if I was looking at the pacing of ticket sales or whatever. I can't believe I kept going. Yeah. And ended up losing money when it was very clear. I ought to have turned around, and so when the second time came around, you're tracking that same stuff and you said, Oh crap, we're not on track.

This is ridiculous. And you paid attention to the signals on that time around. so I did a exercise with some sellers at a SaaS company. So they're selling a cdp, a customer data platform. And the thing about the thing about sellers is that they're super gritty. Like they live to close the deal. But the problem is that we all have limited time and attention to spend on anything. And so if you're take if you start down pursuing a lead and you won't stop pursuing it until it's a hundred percent dead, that is time and attention that you could be using to pursue other leads that are more worthwhile or developing new leads.

That where you can do that exploration and see if they're more worthwhile. So it's actually really important for your sellers to be apportioning their time in a way that is causing them to spend most of their time on the better opportunities. But we know that once they start pursuing a lead, they're never gonna drop it.

So this is really counter to what you want them to be doing because it means they're wasting a lot of time. On a low value opportunities. So we just did basically, similar to I'm sure what you were thinking about as you went into conference three. We just did an exercise with them where we sent out a prompt, which was imagine that you got a lead through an rfp, rfi and it's six months later and the deal is lost.

Looking back, you realized there were early signals that, that were, was gonna occur. What were they? And so it was like 40 sellers and they all had their own lists and looked at them, but there were some themes that came out. Like one of the really strong themes was in the first meeting, the lead only wanted to talk about price.

And that was it. They wanna know about the product. They didn't want anything. They just wanted to know what our pricing was. Obviously that's a bad signal cuz it probably means that you're being used as a stocking horse. They don't really care about your product. And they're asking about price for some other reason that doesn't have to do with buying.

Another would be like, they already have a competitor installed. So we turned these things that they said to us into kill criteria, which are it's just a broad idea. Turnaround time is a kill criteria, which is, okay, if I see these things, it's the sign on the exit door, right?

If I see these set, this set of things occurring that will tell me that I ought to kill what I'm doing, I should stop. So we turned that into kill criteria, which then allowed them to quit more easily when they were getting these bad signals. Because otherwise what happens is that you're talking to the seller and you're like doesn't this lead has the competitor installed?

Like, why are you still pursuing them? And they'll swear up and down that they can win it. They'll just swear up and down that they can win it. And the thing is, sometimes they will, but at too low a probability to make it worth anybody's time. Yeah. That's the thing that we have to remember. So you have to figure out how do you get people to exit these things when essentially, like they're standing in a blizzard on the top of Mount Everest and you want them to get back down to the bottom.

Yeah. I remember the, on the second one that we pulled the plug on called my mentor and he said, Listen, he was like, You should have learned this from the first go round. Don't spend any money on this unless it's from the money you generated from ticket sales. And he said, Look, you might burn a few bridges with your speakers.

Srini: He said, You'll recover from that. He said, Recovering from $50,000 in the hole. He's That's gonna be a nightmare. He said, You won't recover from that. So that was the wake up call for me. But one thing that you say is that quitting on time will usually feel like quitting too early.

And I wanted to talk about it in the context of something else you said. You said that there's a well known heuristic in management consulting that the right time to fire someone is the first time it crosses your mind. And if we don't cut our losses when it's warm to those losses, we'll continue to accumulate.

And I think that in intrigued me in particular, cuz there are definitely people I've kept way longer than I thought I sh than I should have.

Annie Duke: Like all the people .

Srini: Yeah. I mean they, they're literally, I'm just like, Wow, why did we wait this long to fire this person? And I, I was shocked, like it just I kept thinking, okay, maybe it'll get better or something some small signal would be like, Oh, okay, maybe it's getting better.

I was just not willing to do it on the thought. And it crossed my mind enough times where I finally just, I had to reach my wits end before I did it.

Annie Duke: Yeah. I love this. So this is like super fertile ground. So interrupt me if I go on too long. No. Go for it. This is no fun.

Okay, so first of all, let's think about what you just said there that you had to be like at your wits end, like literally done in order to get to it. And this is this weird paradox about quitting which is that the reason why having the option to quit is so valuable is because when we make the decision to start in this case when we make the decision to hire somebody, it's made under really a high degree of uncertainty.

Very little about the person. Like you have their cv, got some recommendations, and a few, a handful of meetings. Okay? So really a ity of information. And then there's also just luck involved. Like you, you could hire them and then some, something could happen. Like maybe all of a sudden they're going through a divorce or whatever.

So what that means is that wow, it's, that's really tough, right? Because like most things that we choose to start, we just don't know a lot when we actually do choose to start it. The solution to that is that you're gonna discover new information after the fact, right? And sometimes you're gonna say to yourself things like, I wish I knew them what I knew now.

That's that feeling of. Incomplete information like hitting you in the face, right? That's where the option to quit is so valuable because the option to quit is what allows you to react to the new information. So you hire someone, you're making some sort of forecast of the people I've seen, this person seems like the best person for the job, but then you're gonna find out a whole bunch of stuff after you hire them, and then you can quit.

Because firing an employee is obviously quitting. It's the same thing. Yeah. You're quitting the employee. Okay. So that all sounds fine and good, except the problem is this, that the decision to quit is also made under uncertainty. So when you're deciding to quit, you can stay on the path you're on or there's many other paths that you could choose.

So you could think about not not even filling the role. What would it, what would that look like? Or what do I think the range of candidates are gonna look like or whatever. So as you're thinking about path A versus path B it's not clear right? Because as you're considering it, like that first time it comes to mind, there's still tons of chances that it could turn around.

You don't know maybe this person's gonna get it together and they're gonna end up being a great employee. So on so forth. And if you switch, it's Ooh, but what if I can't find somebody? That's good. Right? So now you, you have all of this uncertainty there and then you're living in this thought of what if I let them go and I go and go on a job search and I can't find somebody, or I find somebody new and they're bad.

Because it's very uncertain. So when un, what ends up happening is that we won't switch until we know for sure until there is no other Richard Daher said this to me. I think so. He said the only time we're really willing to CRO is when it's really actually not a choice anymore.

Because as you said, cuz I'm at my wit's end, I can't, I literally can't take it. Then all of a sudden you're willing to quit because that's the moment there is no chance to make it work. And as we roll that back, like as we're trying to accumulate that certainty, like why are we trying to get so certain before willing to do it?

Because if you let them go before that, it means you failed. It's the moment that you go from failing to having failed. That's that transition moment. And as an employer who's managing somebody who's hired somebody, you don't wanna let them go, partly because you're gonna feel really bad about yourself for having made a mistake.

But what's ending up happening is that you've got someone now who's continuing in that role way longer than they should, who isn't doing good work. You're preventing yourself from getting somebody who would do good, good work in that job, or maybe allowing other employees to pick up the slack in the meantime obviously with consent, right?

and that obviously would be better than the situation you're in, particularly as it deteriorates and gets worse and worse. So yeah, this is just a general problem, like what you're experiencing is that we tend to get to the quitting decision too late. And there, there was a really fun there was a really fun thing that Steven Levitt did, who wrote Freakonomics which kind of demonstrates this, that I think is really cool.

So he put up a website and it was basically like shie, like you're thinking like should I keep this employer or not? And you could go to the website and you could put that decision in and then the website would flip a virtual coin for you. , right? Yeah. So like heads, you keep the employee on tails, you let them.

So like you, I don't know if you're, I, when you read that, you're like, who would actually do that? And 20,000 people did it. So work with me here for a second. So do you do you see the intuition that if somebody was willing to go and flip a coin to make this decision, that they must think the decision is 50 50?

Srini: Yeah. Maybe either that or they're just trying to avoid responsibility because they don't want discomfort of hiring it or of firing somebody even though maybe it's Oh I wanna fire this person when I'm out. Leave it to a coin flip.

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Possibly but Yeah. I, So I can see that, but So let's think about this though. So you're committing to do what it says, So if it says keep them you're committing to keep them. Yeah. I guess you could not keep them , but even but you're basically committing to what the coin tells you.

So if, Firing the person, were a clear winner or quitting, your job was a clear winner or whatever the decision is. Leaving your relationship was a clear winner. There wouldn't really be a need to flip the coin. Yeah. And if staying in your position or keeping your employee on or staying your relationship was a clear winner, there also really wouldn't be a need to flip the coin.

So if you're going to flip the coin, you have to think it's close enough that you're not sure, like which is the better path. So you're gonna go leave it up to a coin. So in that case, what you would expect is that whatever the coin told you, whether to stick or quit, that the stickers and quitters would be equally happy after the fact.

Because it was like the, it was a close call decision in the first place, and it turns out that's not at all what you find. What he found, what Levitt found was that two and six months later, the quitters were

,

happi. On average. Yeah. And so what that tells you is that at the time that people are experiencing that as a close call, it's not actually close at all, like quitting a clear winner.

And because to your point of like your description of letting people go, you need to accumulate so much certainty around the decision before you're willing to do it. And that kind of certainty is too late. Think about this freeney and imagine if you had to accumulate that much certainty before you started something.

Imagine if you had to be as certain as you need to get to fire someone in order to hire them in the first place.

Srini: you have would be pretty much

Annie Duke: impossible. Yeah. You would like never hire anybody. Yeah. So we're a little bit more willing to just like, Make those starting decisions under uncertainty? I think partly because we know we have the option to quit then in order to make the quitting decision, we have to accumulate an absurd amount of certainty to the point where we know there's no other choice.

Yeah. I'm thinking about this in the context of relationships. I ended a relationship after about two or three months, just I realized, I was like, this is not gonna turn out the way I wanted to. But part of it was because I felt like I'd seen the pattern before in a previous relationship, and I was like, Okay, you know what?

Srini: I've been down this road before and I am not going to let this continue. Because in the past I was like, Oh, I let this drag on for 11 months, you, Whereas this time it was like, all right, this is clearly making both of us miserable. Let's put an end to it now. Yeah. But I feel like in relationships your emotions are so

Annie Duke: heightened.

Yeah. Yeah. Experience is really helpful. Okay, I've seen this before. . And so now I know the signals to watch out for But a lot of times you're not experienced and it's okay, what do I do if I haven't been through this a few times and then I'm stuck? And I think that's where getting somebody from the outside to help you is actually really helpful. So get someone who's been through a bunch of experience sorry get somebody who's been through a bunch of relationships you really respect, who knows you pretty well. You've expressed your values to them really clearly. Yeah. Yeah. I mean if you think about it, like I'm sure that you've seen lots of people in relationships where you know for sure they should be breaking up with them, but they're not

Yeah. Don't say who

Srini: obviously,

Annie Duke: but obviously, yeah. But don't say who. I don't want you to have to say who. But so it stands to reason. If you are seeing that in other people, they're seeing that in you. So wouldn't it be nice if you could go talk to the people who see that in you and actually get them to tell you what they see?

Cause the thing is they're generally not gonna volunteer it on their own. Yeah. Because our tendency is to cheer lead so even if you go and you say, Man, I'm thinking about quitting my job but I don't know they're gonna cheerlead whatever decision you tell them you're making.

Yeah. If you say, But I really think I should grid it out cause like it just feels like I'm I should really, I should give it a go. They're gonna be like, Yeah, that sounds like a great idea. And if you say I'm gonna quit tomorrow, they'll be like, Yeah, you do that great idea.

Right? Cuz that's her tendency is to be supportive and to cheerlead whatever the person's decision is. But what you actually wanna say to them is, I want you to tell me what and help me like with your perspective in some cases, your experience in the case of a mentor, because I wanna know the truth and don't worry about hurting my feelings cuz I'm looking for what's in my long term best interest here.

And get someone to get in on that with you And then they can help you with the decision. Yeah. Because then you don't have to wait around for the fifth time that you've seen this pattern with someone or your third conference. Yeah. That's what I was saying, you can get to that decision

Srini: quicker.

I, that's why I always say you know what you want to hear feels good in the short run, but what you need to hear is actually good in the long run. .

Annie Duke: That's exactly right. But you have to tell someone that's what you want. Cuz otherwise they're gonna, they're. Do the short term thing.

Srini: Yeah. Let's talk briefly about this whole idea of expected value and Dave Chappelle and Stewart Butterfield, because I think that those really struck me of people who could see long term that this wasn't gonna turn out the way they wanted to. But so many of us don't. I remember when the Chappelle thing happened, every one of us was like, one, we were pissed off cuz we wanted more Chappelle show.

Yeah. But beyond that, like we thought who would walk away from this, the height of their career.

Annie Duke: Which is also true of Seinfeld. Barry Sanders. There's a, there's, we can name people who've walked away. I just

Srini: think of that George Stan's episode. You know which one I'm talking about. Just quit on a high note.

Annie Duke: Yeah.

Yeah. Okay. So here's the problem with quitting decisions is that they're what we would call expected value decisions. So what that means is that you have to make some sort of forecast of the future about what your long term gains or losses are gonna be. So you have to be looking ahead.

So just to look simply for people to understand expected value. If we're flipping a coin and you're gonna win $2, if you call the coin correctly, and you're gonna lose a dollar, if you don't, you'll win $2 half the time. So your gross earnings are gonna be a dollar for every flip, right?

If you win, and because there says 50 cents, 50% of $2, and then if you lose, you're gonna lose a dollar 50% of the time. So it's 50% of a dollar is 50 cents. So you've got $1 on the gain side versus 50 cents on the loss side. Which is positive 50 cents. So what that tells you is that for every dollar you bet you're gonna be making 50 cents.

That's pretty good return, but that's gonna be what happens over the long run. So if you bet 10,000 times you should on average you're gonna come away with $5,000. Now notice that on any given flip you can't ever win 50 cents. You're either gonna win $2 or lose a dollar. That's where expected value gets a little tricky.

Cause you're thinking about what's gonna happen over the long run. So this is a hard thing to do. And people might be saying, Okay, I get it for Coins list. What does that have to do with like actual, like regular life decisions? And as you said, Stuart Butterfield, I think brings up a good example of how to think it expected value really well.

So Stuart Butterfield founded a company called Glitch. It was actually the second company he had founded. And Glitch was developing a game called Game Never Ending. Which was a massive online role playing, world building game. And it was a critics darling, they said it was like Monty Python made Dr.

Suit. They loved it. They've got the game out and really they're building it through word of mouth cause it's community building. And they've managed to get 5,000 super sticky users. So these are people who are using the game 20 hours or more a week. And obviously they're the ones who are paying customers.

He's got the backing of some pretty big venture firms and he has $6 million in the bank. So things are going pretty well. The problem though, that everybody could see was that for, in order to get those 5,000 users, they actually represented less than 5% of the people who had tried the gate. You had to get it in front of a somewhere between 95 and a hundred people in order to get one person to play.

And the other 99 people or whatever would play seven minutes and leave on average. Okay. So that's a little bit of a sticky problem because you have to, it's, it, you have to, a lot of people have to be aware of the game in order to get the paying customers. So they all decide, the founders and the investors decide they're gonna do a huge marketing push, which they do.

So remember they had been doing PR before and now they're doing more traditional marketing, which is paid marketing. And they do this for six weeks in the fall of 2012. So they, it goes, Sorry, lemme, so it goes amazing. Week over week growth is like 6% and it's really good. And we get up to November 11th and 12th, which is a weekend, and it's actually the best weekend they've had in terms of acquiring new users.

And Stuart Butterfield goes to bed and he's really restless, he's stressed out, he finds a cell able to sleep, and the next morning he writes a note to his investors and his co-founders that says, I woke up this morning with the dead certainty that glitz was over. So he just announces that he's shutting it down.

So that seems really weird because new users were growing 6% week over week, and then the 11th and 12th of November was actually like their best week. But what happened was that he was thinking about expected value. He was thinking about the long run here. And what he realized was that if you made the assumption that you were gonna continue to grow at the rate that they had been growing over the last six weeks, it would still take 31 weeks even to get break, to break even.

and that was an absurd function because at some point you're saturating the core gaming audience so your customers become less and less valuable as you move along. And so he realized like 31 weeks was optimistic and it was probably gonna be like a lot more than that.

And at that point he just realized from an expectancy standpoint that it just wasn't a venture scale business. No. So he shut it down. Now, his investors were quite surprised and his co-founders were quite surprised, but he explained the math to them and it's not clear if they really understood it, but I think that they just understood what am I gonna do?

He doesn't wanna do it. And Stuart Butterfield's the engine of this thing. So I guess we are, we're just gonna stop and Butterfield's gonna return the capital to the investors. Now this may seem Oh, what a sad story. I shut his company down. But we have to realize it's actually a really happy story because Yeah.

No, it's cause if he figure, if he knows that it's not gonna work out, why would he waste another minute of anybody's time on this project? He's got 6 million in the bank. Should he spend that 6 million to find out what he already knows? This is your point about the employee where you had to get to the point where you couldn't take it anymore.

Why didn't you do it before that? Think about how much you would've saved by doing that. Yeah, absolutely. So he's figured out this isn't worth I'm not gonna spend the $6 million because I'm only gonna find out what I already know today because I can think ahead. Yeah. And then he also said, I didn't wanna trap my employees in this because they were working mainly for equity and I had determined that equity wasn't worth their times.

So I wanted to be able to free them to be able to go do something else cuz they're brilliant. Where they, their equity would actually be worth something. So he shuts it down. So I hope that you can see I hope you can see that like that. If that's the end of the story, that is an incredibly happy ending.

He returns $6 million to the investors that they could go invest in something that was gonna be worthwhile. He let his employees go and be able to do something that was gonna actually, they were gonna find purpose and money and so on, so forth. He's freeing up his own time. All good, right? Yep. But then we get to the second lesson of this, because what ended up happening was lit.

It was like immediate that he quits glitch, he shuts it down and then he says, Hold on a second. We have this internal communication tool that our employees like really? And it combines like the best stuff of like email and instant messaging and you can put attachments in there and it's, they, they love it.

Really good for team building. Didn't have a name, but they had been using it for quite a while over at Glitch. Yeah. And so he said they really love it. Like maybe that's my next business, . And so he said, I should give it a name. And the name he gave it was searchable log of all company knowledge, which is Slack.

Srini: I did not actually know. That's what it stood

Annie Duke: for. Yes. Searchable log of all company knowledge. Ah Slack. So within two days the investors have rolled their money into Slack and employees are working on Slack and we know what ends up happening to that. Yeah. And this is what I think is right.

So this is what I think is so amazing about it. So there's a temptation to believe that, that's why it's a happy ending. But it's actually not. It's a happy ending, even if he doesn't ever develop Slack. And what's more important is this lesson is that while he was working on Glitch, he couldn't see Slack.

They had been using Slack for a long time. That was the venture scale business. But he couldn't see it until he quit Slack. Until he quit Glitch. Because when we're pursuing something, it makes it not only, so that's time and attention. We can't use to pursue other things, but we also become myopic where we can't even see the other opportunities that are available to us. Yeah. So he now all of a sudden gets to see it. And he actually said to me, he goes I quit at this time when everybody thought that I was nuts, but I'm actually embarrassed because I knew it six weeks earlier. I knew it before we ever did the marketing push, but I still agreed to the marketing push because I, he said I didn't wanna look like I was capricious or something or just.

I got bored. Yeah. I wanted to people to, to know that I was trying, So he was actually trying to accumulate more certainty for other people because he was worried about the criticism.

Srini: Yeah, I remember you writing about that. I honestly I knew earlier than I pulled the plug also in the conference.

So this actually segues perfectly into, I think a final part of this that I wanna cover, which is identity and quitting. And I wanna bring back a clip from an old episode with my mentor, because I think this'll tee up this whole concept of identity and quitting really nicely.

Take a listen. I worked with a gentleman who was a baker.

Annie Duke: He baked goods for hostess. Hostess, went out of business, filed bankruptcy. He lost his job. He had been working at Hostess since the age of 22. He was 55. So everywhere he goes for 20 some odd years, he's saying to people in his life, I'm a baker.

That's identity, now, he's no longer a baker. He can't get a bakery job. They've laid him off, He can't find work. He's outta work for 18 months. So he's thinking to himself, whether

,

consciously or not, but I'm a baker. I'm a baker. Why am I not baking? Why do people not know me as a baker? Why can't I say I'm a baker?

And whether that seems silly or not, that's what we do as human.

Srini: So I think that really in a lot of ways, summarized one of the things that you talk about, which is our own identity makes quitting so hard. And I think the startup founders are such a great example of that because I know you're right about Ron Conway.

Like I can tell you I honestly, like I, if I were to shut down unmistakable creative, I'd really be lost for wallet. I've seen this when I've talked to athletes who've reached the end of their careers and there's this tremendous loss of identity when they quit. So talk to me about how identity plays a role in our ability to not quit.

Annie Duke: Yeah. To the point of the baker obviously this is the thing about what can you see from the outside? Like you can see very clearly but why isn't he looking for work that isn't baking? Right? He's out of work for 18 months, he's searching for a baking job.

Why isn't he looking for something else? And this is what identity. Does to us, because really the hardest thing to quit is who you are. And that is a thing that we do really don't wanna abandon. And that's true both of like things we do being a baker, but also like our ideas, right?

The beliefs that we have that really define us. So you can imagine like if you hold a mainstream belief that everybody else hold that when you get new information is gonna be pretty easy to abandon because it doesn't define you in any way. It doesn't make you different than any other people, right?

But if you have a belief that's extreme, like I believe that the earth is flat then you can throw as much evidence at that as you want and people are gonna rationalize the evidence away because that belief now defines them because it's so unusual. And this is true for not just flat earthers, but John Bushier at Katie Milman did a fun study where they just looked at stock analysts and what their earnings forecasts were and.

What they found was that when the analysts were making forecasts that were very mainstream and the actual earnings came in and they didn't bear out the forecast, they changed the analysts changed their forecast. They just updated the forecast according to the new information. But when analysts made forecasts that were out of consensus that were really unusual, then when the actual earnings came in and didn't bear out the forecast, they didn't update their forecast, they doubled down on it.

So they just refused to change their minds, which is a form of quitting. And it's because like when you're taking these, when you're sticky a stake in the ground, that's unusual. That becomes part of your identity. So that's like the first thing that has to do with ideas and are we doing something that's defining us?

But I think to the baker thing we can see this there's such a fun example of this that comes from a very big business cuz we need to realize People can have these identities that they don't wanna walk away from, but still come businesses. I'm sure you're familiar with the store, Sears.

Yeah. I hope . And if you were to describe, like Sears is a retail chain that had physical locations and at one time had a catalog. Is that a fair description of that? Yeah, no, I think so. And they're also now bankrupt. They're dead. Yeah. So Sears actually started in the late 18 hundreds.

They had a catalog, it was called The Book of Bargains. It's like 1200, 500, 12 pages. It it was when mail was becoming like pretty efficient. And it was to get products that people could get in cities to people who lived in more remote and rural areas. And like you could get kind of anything in there.

I think you might, I think you could, I think you could buy a house in the catalog, if I recall. But like bicycles, whatever shoes, like anything you can think of you could buy in this catalog. So super successful I think in the 1920s. Sears himself was worth like $26 billion. $26 million rather.

$26 million, which obviously in the 1920s was a ton of money. Yeah. So they're doing really well with their, with the catalog. And then people get cars, which gives them greater mobility and allows people to now get to stores more easily. That kind of cuts into their business a little bit. So they decide that they're gonna open retail locations.

That's how we come to Sears with actual physical locations. And that business thrives. And by the 1950s, Sears represents 1% of U S G N P. It was a big, it was a success. Now then what happens is the story is pretty simple. The Kmarts and Walmarts come along, They're like eventually target pushing them from the bottom.

And then the higher end chains like Neiman Marcus come and they're squeezing them out at the top. And by the nineties it's no longer the number one discount re we discount retailer. I think both Walmart and K-Mart had it beat by then. Target pretty quickly after that. And then it's just a slow decline into bankruptcy.

So that's a story we all know about Sears. You're wondering what does that have to do with identity? Here it comes. Sears was not just a retail company. It was also a financial services company, which you probably don't know. It's not tied into their identity. No, it started because for their catalog customers, they needed to offer credit.

So they had a banking division in the late 18 hundreds. And then when they actually created those stores, because they realized there was this greater mobility because of the automobile. Someone had the bright idea, Sears, which was a really bright idea that people in these newfangled automobiles were gonna need insurance.

And so they decided they were gonna offer insurance, car insurance to customers in their stores. And they founded a company called Allstate Insurance. I don't know if you've heard of that company. Yeah. . And then we, Allstate obviously it's owned by Sears. It ends up being the largest insurer, personal liability Thrive in the seventies adding to their financial services empire.

They acquire a company called Dean Whitter, which was a stock brokerage. Just to give you a sense of how successful it was Morgan Stanley eventually acquired it, and at the time it represented 40% of Morgan Stanley's net worth. So that's of its market cap. So that's a big company that they had. And then they also created the Discover Card also part of their financial services empire, and they acquired Coldwell Banker, which is a realtor.

Yeah. So I don't trini Are you wondering how this company could possibly do bankrupt if they owned all that stuff? ?

Srini: I know how the story ends cuz I've read the

Annie Duke: book. Yeah. Just to give you a sense of the value of these companies I think Allstate alone I'm not sure what it is now, but at the time that I wrote the book, I think the market cap was like $40 billion.

So it will, it's what happened then? What happened was that as the retail business started faltering, which is the story that we all know The shareholders were demanding action. So you have this faltering retail business and this driving financial services business.

It seems like from the outside looking in, the decision would be let's just ditch the retail and let's go with the financial services. No, but what is SEA'S identity?

It's the retail business. They're a retailer. So what the board ends up deciding to do is to quote unquote, get back to its retailing roots. Yeah. As if this is the problem. And they sell off Allstate, they sell off Dean Winter, Discover they sell off Coldwell Banker in order to save the retail business, which obviously didn't work.

And I think this is like the Baker walking around for 18 months trying to find work. Because that, the only reason that happened is because nobody knew that they owned Allstate. Nobody knew that they were a financial services company. Everybody knew them as a, I didn't quite read your book.

Yeah. You gotta save your identity. You can't quit your identity, so they sell off the other stuff. Yeah. I, it makes me think about my own career as an author. I did two books with Penguin. think we're both part of the same imprint. I don't know if this book is all so portfolio, but I realized after the second book I was trying to get a third book deal for about a year.

Srini: It wasn't happening. And I realized at a certain point I was like, you know what? I gotta come to terms with the fact that maybe this part of my career is done. That published author with Penguin is No longer by Identity and pursuing it endlessly is Ode to Nowhere. And I realized right after that I was like, Wow, there are a lot of other things I could do to make money that are a lot more lucrative.

Annie Duke: So that's the Stewart Butterfield thing, right? Yeah. Abandon the identity. And then what you realized was what could I be doing with that time? Oh yeah.

Srini: No, I mean I, My trade off was like, I looked at it this way, right? We raised investor money and I said, All right, if I get another six figure book contract, I'll get a windfall.

That basically carries me for a couple years. If I get to the point where unmistakable creative produces a return for my investors, we sell the company, I have some sort of exit, I will be set up for life, right? And I'm like, that's an obvious. At that point I was like, Yeah, I don't need another book deal.

And one of my friends was like, Dude, you got your book deal cuz you self-published. And he was like, Fair enough. And he was like, You don't need to write any more books. I got what I needed from.

Annie Duke: Yeah, exactly. That's such a good way to think about it. Yeah. So I wanna let you know, like we have four minutes, so let's go.

let's wrap

Srini: this up. Let's do it. . You know what this has been absolutely. Fantastic. So let's wrap this up with two final things. One of the things that you say is this belief that optimism will get you to where you wanna go faster is deeply embedded in popular culture as evidenced by a host of perennials best sellers such as Norman Vince Appeals, The Power of Positive Thinking, Napoleon's, Hills Thinking, or Rich.

And The Secret to just name a few, and you said, The problem is that optimism causes you to overestimate both the likelihood and magnitude of success. That means that any calculation of your expected value will be wildly out of wack. The result. Optimism, unchecked by realism prevents you from quitting when you ought to walk away.

And the thing is that people are getting this message drilled into their heads by popular culture, popular media self-help books. And so how do we counteract that so we don't just, Yeah. End up in this delusional, optimistic state.

Annie Duke: I think that this is related to what we talked about before about what was it like, Don't bet your ener bet this is a, not a money problem, an energy problem, or, Yeah.

Don't have a plan B. You just gotta believe. Yep. And just try to power through it and do it. I just think it's like super damaging. How do you counteract it? I don't know. The problem is that we're biased to believe that kind of stuff. We're biased against quitting, and so as long as there are people who will write those books, there are people who will read them. And I think it's very hard to un undo. And it's honestly like a lot of the reason why I wrote this book. I was just tired of that conversation. And then even when someone tries to give a nuanced argument about it, which Angela Duckworth did and grit her book is great.

Yeah. People misinterpreted it to go with what their preconceptions are. So what she's saying is find something you love and stick to it, even if it's hard. She's not saying just stick to stuff. Yeah. Because that will build character. She's not saying if you stick to things, you'll succeed.

What she's saying is, if you find something that you love and you stick to it, you'll succeed. Yeah. That's the part about like passion. The power, perseverance, and passion you have to find the thing that you're passionate about. She just doesn't want you to say never stop anything that you're starting.

That's a misinterpretation of her work. But people interpret it that way anyway, just grit is good. I had someone write into me who had heard me on a podcast and said, Oh, I'm so happy that I heard you, because I was in a job with a toxic boss and I thought if I quit, it would show a lack of character. But then I heard you talking and I quit and I'm so much happier.

Yeah. The thing is, I don't ireni, I really don't know. Like I'm writing this book trying to make a dent, but this is the way we think. Absolutely. We believe that optimism will carry the day. Stick to things and you'll succeed. Winners never quit and quitters never win all that stuff.

And I think it's it's hard to knock through that. That's a lot of built in cognition that you're trying to, that you're trying to push against. And I think it takes some thoughtfulness in someone at least trying to tell the other side of the story, which hopefully I'm doing a little bit of.

Yeah.

Srini: In the interest of time, I wanna finish my final question, which I know you've heard me ask before. What do you think it is that makes somebody, or something unmistakable. I really do feel like it's the ability to say I'm wrong, or even just to say, I can see your perspective. And just because your supe perspective is different than mine, I don't think you're wrong. Beautiful.

I can't thank you enough for taking the time to join us and to share your wisdom and insights with our listeners. As I said, this is my favorite of your books. I think everybody listening to this should read it. So for that, for them, where can they find out more about you, your work, the book, and everything else you're up to?

Annie Duke: You can always follow me on Twitter at Annie Duke. But you can also go to annie duke.com. And there you can find links to buy my books. You can find links to contact me to hire me if you want to. You can find a link to sign up for my newsletter. So hopefully people will find lots of info about me there.

And then I would also love for people to go check out the Alliance for Decision Education, which is a non-profit I co-founded to try to get decision education into every K K12 classroom. So hopefully people will go explore that also. Amazing.

Srini: And for everybody listening, we will wrap the show with that.