Emotional Estimation
MisconceptionEmotional Estimation is the dangerous practice of using current emotions and feelings to make business decisions and predict future outcomes, rather than relying on external data and market validation. It manifests in two key ways: poorly predicting how future events will actually make us feel, and allowing present emotional states to cloud judgment about opportunities and potential.
About Emotional Estimation
Emotional Estimation is the dangerous practice of using current emotions and feelings to make business decisions and predict future outcomes, rather than relying on external data and market validation. It manifests in two key ways: poorly predicting how future events will actually make us feel, and allowing present emotional states to cloud judgment about opportunities and potential.
Eben provides personal examples of entrepreneurs who found early success and then used emotional estimation to calculate unrealistic future profits, as well as the common pattern of lottery winners (80%) ending up in worse financial condition within five years due to emotional decision-making.
“We humans are not very good at predicting how things in the future will make us feel. We're horrible”
— Eben Paganon Explaining why emotional estimation leads to poor business decisions
Perspective
“Trust your gut feelings and emotions when making business decisions and planning for the future”
Use external data and market validation instead of internal emotional states to make business decisions and predictions
Evidence 3
Emotional estimation prevents success by making us terrible at predicting how future events will make us feel and using current emotions to judge opportunities
Eben explains this has two sides: predicting future feelings ('if I do this it will make me feel good') and using emotio
From: A Mindset To Help You Plan Your Successat 0:31Early business success creates dangerous emotional estimation where entrepreneurs calculate unrealistic future profits
Eben shares his personal experience finding a great lead source that converted at high rates, leading him to plan buying
From: A Mindset To Help You Plan Your Successat 4:10Believing that reaching a financial goal will permanently solve all problems is emotional estimation because you bring yourself to that new level
Eben explains the common notion that reaching $5 million will solve all problems fails because 'it's still going to be y
From: A Mindset To Help You Plan Your Successat 4:34Questions Answered
What is emotional estimation and how does it hurt business success
Emotional estimation is using your feelings to make business decisions instead of data. It has two sides: predicting how future events will make you feel, and using current emotions to judge if something will be good or bad.
From: A Mindset To Help You Plan Your Success
Why do lottery winners lose their money
About 80% of lottery winners are in worse financial condition five years after winning than before they won. This happens because of emotional estimation - the same mindset that made them think winning would solve everything also makes them lose the money.
From: A Mindset To Help You Plan Your Success
What is the difference between market validation and emotional estimation
Emotional estimation is sitting back and planning who should buy your product and trying to talk them into wanting it. True validation is finding out something customers already want and then giving it to them.
From: How To Choose Your Target Market
What is the most dangerous mistake when hiring employees?
The most dangerous hiring mistake is emotional estimation - making decisions based on liking someone rather than their ability to perform the job.
From: The Most Dangerous Mistake You Can Make When Hiring
Evidence
Eben provides personal examples of entrepreneurs who found early success and then used emotional estimation to calculate unrealistic future profits, as well as the common pattern of lottery winners (80%) ending up in worse financial condition within five years due to emotional decision-making.
Quotes
“If you're not using some data that's coming from outside of this dome piece of yours to make your decisions, you're probably erring in some way.”
— Eben Pagan
“We humans are not very good at predicting how things in the future will make us feel. We're horrible at it.”
— Eben Pagan
“I really like them liking a person can be one of the most dangerous things when it comes to hiring people”
— Eben Pagan
Source Content 1
A Mindset To Help You Plan Your Success