Ask HN: How do you determine if something is a sunk cost VS needing patience? | Hacker News Reader

Ask HN: How do you determine if something is a sunk cost VS needing patience?

6 pointsJSLegendDev5 comments

I think most of us heard about something called the sunk cost fallacy.

It implies that someone might keep investing in an endeavour because they have already invested a lot up to this point instead of investing their energy in something else which would be more beneficial for them.

However, in practice, I find it very hard to determine when to give up and switch to something else VS be patient to obtain the best result.

I wonder what HN thinks on the topic.

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Persevere. Get emotionally invested. Be a little stubborn. Commit 100%. As investors say, strong opinions, weakly held.

The stages of grief are a biological checklist:

1. Denial: Is it a measurement error? A fluke? Not enough time? Unexpected disadvantage?

2. Anger: Am I a coward for abandoning this? Why did I do this in the first place? Does the new path go against my moral values?

3. Bargaining: Is there a way around this problem? Do I need to give up or can I concede something?

4. Depression: At this point, you accept it is over. Mourn the idea. Have some kind of ritual. Blog about failure. Separate from it cleanly.

The trick is to approach each stage logically.

People tend to be completely irrational. They'll call the data fake, blame the sources, blame luck, blame privilege, government, etc. People get stuck on this for years. They become scared of failure. They burn through the passion, then rely on discipline. Then they burn through the discipline too and settle wherever they are.

Go through the grief, but treat it like a form. You have to deal with each stage, especially depression and the burial of that goal. Sometimes you get stuck at bargaining - "I'll come back to this project later."

I used to work in VC and have talked to a number of people regarding this. The classic pivot vs persevere problem.

1) My view is that you don't/can't really know in advance. Most of the examples you see/hear about are retrospective, and suffers from survivorship bias and/or positive reporting bias. Ex. Typically, you only hear about how people's decisions led to success. Or you only hear about earlier failures if the subject later succeeded. What you don't hear about are other people who made similar choices and still failed. Unless you're connected to these builders/founders networks and have insider-access/great rapport, it'll be difficult for you to get exposed to the hidden, unreported side.

2) What's worth analyzing are the material consequences of whatever outcome/decision path. One thing you do want to avoid is anything that could take you out of the game, so to speak. Like huge financial obligations, etc.

3) And most decisions aren't so black and white. There's a very large, gray area in between where you could get real creative. In this gray area are 3rd options where you could be positioning yourself for long-term sustainability to work on whatever it is on your mind. Sometimes I call it "pivot to persevere." Ex. creating another venture B to fund venture A.

There’s an article I like on this topic called Staring into the Abyss: https://www.benkuhn.net/abyss/

It talks about asking yourself really hard, scary questions as a habit, that may result in having to admit that you made wrong decisions or wasted time or money. Persevering is often the easiest decision but may not be the best.

You've stumbled on one of life's uncertainties. When should you abandon something, when should you persevere?

Sunk cost says that "how much you've already spent" is not a factor. And whole you certainly shouldn't make it a factor, it certainly makes the "decision" harder.

It's easier to abandon a project you've spent a weekend on, than one you've spent a year on.

You can try thinking of it objectively. "Here's this project, someone else did. Do you want to take it over, and run with it?"

Did you do your market research first? Do you have some deposits in the bank for when it is done? Are you quitting because there's more work to do? Or because you've taken it to market, and there is no market...?

If you are not making progress, trying something else might provide insight into why that is.

If it is only a matter of patience, then the time spent working on something else is still waiting patiently.

It is only when it is only a matter of effort toward what you are already doing that trying something else is clearly wrong.

In other words you are allowed to work on two things at the same time. Good luck.

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