Context:
Here’s the thing I keep seeing: people throw around the word “stupid” way too easily, especially in business. But in my experience, most people aren’t dumb. In fact, they’re usually pretty sharp. When you see someone doing something that looks idiotic or irrational, I’d bet 80-90% of the time it’s not because they’re clueless. It’s because you don’t fully understand their incentives, their worldview, or the context they’re operating in.
Market Signal:
This is especially true in early-stage VC, where the real job is less about analyzing markets or products and more about deeply grokking the teams. The best investors aren’t just spreadsheet jockeys, they’re empathy machines. They’re constantly trying to reverse-engineer the other person’s model of the world and the incentives that drive their decisions. If you can do that, you’ll actually understand why people do what they do, sometimes even better than they do themselves.
Takeaways:
If you catch yourself thinking “this founder is just dumb,” pause. Maybe you’re missing something.
Your job (especially in VC, but really in any business interaction) is to do the work: understand the other person’s worldview and what they’re optimizing for.
This requires real context and real empathy. You need to put yourself in their shoes, with their beliefs, not yours.
If you’re not willing to do that work, you’re probably just being intellectually lazy.
Seed VCs, in particular, are basically unlicensed therapists for people with a very specific entrepreneurial “delusion.” Our job is to analyze those delusions, understand the underlying incentives, and then decide whether to back them (and share in the upside).