Mistakes Are Not Unique
Every founder believes their journey is unique. That’s largely true. But when it comes to decision-making errors, the situation is different: the same patterns appear over and over again.
Daniel Kahneman summarized decades of decision-making research with this observation: people make mistakes in systematic and predictable ways (Thinking, Fast and Slow, 2011). These errors have nothing to do with intelligence; they stem from the structural characteristics of the brain’s automatic processing system.
Entrepreneurs are particularly vulnerable to these biases. That’s because uncertainty is high, there’s pressure to move quickly, and emotional investment is significant—precisely the conditions under which cognitive biases are at their strongest.
Mistake 1: The Sunk Cost Trap
A product isn’t working. But six months of work have gone into it, money has been spent, and the team is exhausted. Yet the project continues based on the thought, “We’ve invested so much—we can’t just walk away.”
This is exactly what Kahneman calls the “sunk cost bias.” What was spent in the past should not—and must not—determine future decisions. But the brain automatically ties the present to the past.
Check question: “If I were starting this product from scratch today, would I still go in this direction?” If the answer is no, the decision to continue may stem from the sunk cost trap.
Mistake 2: Confirmation Bias
The product idea is exciting. We look for customer reviews that support it and ignore signals that question it. The first few users are satisfied—this is interpreted as proof of general validity.
Confirmation bias is particularly dangerous in the early stages. Because at that stage, it’s still easy to course-correct, but the bias prevents that from happening.
Control mechanism: actively seek to disprove the idea. The question “What is the strongest argument that would disprove this idea?” yields more valuable data than the question “What supports this idea?”
Mistake 3: Overconfidence
The vast majority of entrepreneurs systematically overestimate market share, growth rates, and the timing of profitability when entering the market. This is not a personality trait; it is a recurring cognitive pattern observed in research.
Kahneman calls this the “planning fallacy”: estimates are based on the best-case scenario, while average or worst-case scenarios aren’t given enough weight.
Control mechanism: Use an “outside perspective.” What are the growth patterns of similar companies? How long did initial product launches take on average in this industry? Comparing your own projections to this reality improves the quality of your estimates.
Mistake 4: Scaling Too Early
Moving to scale before product-market fit is fully established. The team is expanded, marketing spending is increased, and operations are scaled up—but the foundation isn’t yet solid.
Noam Wasserman’s research identifies early scaling as one of the most common causes of startup failure (The Founder’s Dilemmas, 2012). This is because scaling amplifies existing problems rather than solving them.
Steve Blank’s “customer development” methodology was designed to prevent this mistake: don’t move to scaling expenses without first validating product-market fit on a small scale.
Mistake 5: Making Decisions Alone
Critical decisions are not shared with the team, no one is consulted, and no outside perspective is sought. They are made alone, driven by the confidence of “I know this” or the pressure of “there’s no time.”
This is particularly dangerous for the founder because the fusion of personal identity and the company makes decisions emotional. When emotional investment is high, internal filters become less effective.
A pre-mortem analysis is a powerful tool here: before a decision is made, ask, “If this decision fails two years from now, why might it have failed?” This question brings blind spots to light.
“People operate within predictable patterns of error. What is predictable can be prevented.” > Daniel Kahneman, Thinking, Fast and Slow, 2011
Cevvela’s Perspective
- Founders’ decision-making errors are not unique; they follow predictable patterns of cognitive biases (Kahneman, 2011).
- The sunk cost fallacy, confirmation bias, overconfidence, premature scaling, and solo decision-making—all five can be mitigated with structural tools.
- Control mechanisms—pre-mortem, outside perspective, and the “what if” question—don’t perfect the decision but do improve its quality.
- High emotional investment weakens cognitive filters; the outside perspective is therefore the least-used resource during the most critical periods.
- Coaching can be used in this process to create a space for structured pre-decision questioning and to identify patterns of bias together.
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