I was listening to a podcast today. An entrepreneur shared a quote that got me thinking:

Pessimists sound smart, but optimists get rich.

I’m not sure who said this originally, but I think it’s a great quote for entrepreneurs and investors to keep in mind. A disposition that considers the worst things that could happen or the potentially negative outcomes is valuable because it keeps the What could go wrong? and What risk am I taking on? questions top of mind. Managing downside risk is critical to surviving long enough to get lucky as an entrepreneur or investor, and you can’t survive if you’ve taken on more risk than you realize.

But being mostly pessimistic severely limits you, because you constantly think that things won’t turn out well. Surprise, surprise, when you think like that, things don’t turn out well. It’s a self-fulfilling prophecy.

The most successful entrepreneurs and investors I know are neither wholly optimistic nor wholly pessimistic: they’re about 80/20. They’re optimists 80% of the time, but 20% of the time they’re thinking about the downside to make sure they’re not going to do something that takes them out of the game permanently.