The real ‘Dragons’ Den’

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I am standing at a crossroad and I am going to make a life changing decision before the end of the week. Choosing between two options where I never even thought about, but the time to act is right now.  Shall I just follow my heart or abandon my emotions and make a safe and wise decision? It is not as easy as flipping a coin but the odds are quite similar for this ‘gamble’. Am I a risk taking guy or just the average John Doe who plays it safe? A lot of questions surfaced but even less answers came up. The life changing decision I am talking about has everything to do with my lifelong dream of becoming a successful entrepreneur and the time to act is right now, but do I?
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My idea

Not that long ago I entered a competition for promising start-ups that need external capital to start called Dragons’ Den, and I made it to the finals! I am approached by an investor that wants to invest in my start-up. So, what is my ‘’billion dollar idea’’? My idea, or you can called it my dream, is not that revolutionary or world changing then you would expect, but it is something I like to risk ‘everything’ for. My lifelong dream is to own my own beer brand and in real-life I already made a start with this idea (see image). My hobby is brewing my own beer and with today’s technological advances and world-wide available knowledge, it is perfectly possible to brew a premium beer that you would only expect from professional large-scale breweries.  In today’s climate, beer and special beers increased in market share and popularity and beer has become ‘cool’ again. So why not start my own brand and combine my love for beer, brewing and business economics?

My business plan

My idea is to start a relatively small beer brand that starts locally and tries to grow bigger and bigger each year. The biggest task it to develop a special recipe that is different from other brewers but still attracts demand. There are a lot of different beer styles, ranging from Pilsners, Ales, Doubles, Triples to Stout beer. A lot of different styles makes it even harder to produce the ‘best’ and most tasty beer that is liked by the most people. The first task is to develop a beer with a personal twist and with a nice interesting story to market. The second step is to produce the beer but this step is also complicated. Traditional brewers own their own brew installation but a large capital investment is needed to achieve this and is accompanied with a lot of risk. A solution to this problem is to outsource the brewing process to smaller contract brewers who can produce any kind of recipe. In this way it is possible to start small and to ‘try the market out’. I already started with a concept brand called ‘Hooglander bier’ and I want to start producing Pilsners before I start with brewing more special beers. I want to market the brand in my hometown where I have access to different distribution channels and contacts to sell my beer. My dream is to become the next Heineken or Bavaria and sell my brand eventually for an 8 figure number.

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Crossroads

But before I become the next Freddy Heineken I have to make a difficult decision. The person who wants to invest in my idea has a couple of conditions before investing: I have to decide this week, it is a onetime offer, I have to quit my study and I have to move to Amsterdam. A hard decision because finishing my second master was a goal for me but becoming an entrepreneur before graduation was also on my ‘list’. To make a final decision I will use a couple of different theories that I used in my previous blogs.

Theory

To find out if my decision turns out to be everything I ever wanted I cannot just rely on my preferences. I have to make a sound decision because my future is on stake. On the basis of a couple of interesting theories I used in my last blogs I try to discover the optimal decision. According to the The spiral of creation by Marinus Knoope, which is a simple and compact model that describes 12 steps that you have to follow to materialize your personal dreams/wishes, I could say I am currently at step 7: Deciding. After completing the first six steps, wishing, visualizing, believing, expressing, researching and planning, with the right amount of focus it is possible to make a decision that is based on enough evidence. But to come to a definitive decision other frameworks exist, for example I have to find a perfect match between my reason and emotion. According to P. Zimmerman and J. S Lerner from Harvard University they state that: ‘’before you can even form a thought, emotions are influencing your judgments’’ in their paper The emotional Decision Maker. They state that you cannot write off your emotions, you have to investigate your emotions and after this investigation you can decide what role they play in your decision-making process. I cannot just make a rational choice, my

emotion says to just take the offer but my ratio says to play it safe and finish my second master. I have to investigate this emotion and I have to decide if it is a valid ‘input’ in my decision-making process. Another interesting view on decision-making is from Renata Salecl and it is called The paradox of choice. Her view is that when choices increase, also ‘choice’ anxiety increases. This anxiety in combination with the capitalist ideal of the self-made man leads to social paralysis.

Some anxiety provoking thoughts:

  • We choose what other people are choosing
  • We try to make an ideal choice
  • Choice always involves a loss

I agree with Salecl that this ‘anxiety’ can make it difficult to make an optimal decision but if you take this ‘anxiety’ in consideration it is possible to make a better decision. For my decision-making problem I have to take this anxiety provoking thoughts in consideration. I have to make my own decision and I have to accept it may not be the ideal choice and I have to make sacrifices to make it a success. Next to these theories another view on decision-making came up in my blog. To reach a certain goal you have to set boundaries. Without boundaries it is very difficult to keep yourself on track. You have to commit yourself to reaching your goal and you have to watch out you don’t get sidetracked. You have to be a hundred present sure you want to reach this goal, otherwise it won’t work out the way you have anticipated.

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Final Verdict

By using different theories on decision-making I found out my final answer of my decision-making problem. I always wanted to become an entrepreneur and that was also my reason to pursue a study in business economics. Because I already have a master’s degree in Accounting I don’t risk ‘everything’, I will always have a solid basis to start a professional career in accounting on if my business idea fails. I want to take this opportunity and start with fulfilling my lifelong dream and this is the perfect opportunity, it is time to act! And according to some Inspirational quotes from recently deceased. I don’t want to settle for less, I want to commit to the fullest and become the most that I ever could be. So, go big or go home and don’t settle for less!

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Too many choices?

 

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As fictional television character Harvey Specter from the TV hit series Suits, played by Gabriel Macht, explained in the above standing quote: You think you don’t have many choices but in fact, you have a lot of choices and it is important that you make the right one. This blog post will elaborate on the fact that in real life you have a lot of options which means you have got a lot of choices. Reflecting on your choices is very important in your decision-making process and I will provide an interesting theory on it. I will reflect on my own decision-making process by giving an example.

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Reflection of choice

Everything in your life is a reflection of a choice that you have made in the past. And if you want a different result you have to make a different choice. But making choices is a difficult process and you may not choose the optimal option. But the general consensus in today’s society is that every choice you make in life is an opportunity to select the best possible outcome which would you make the most happy. And therefore you could say that more choices lead to more happiness.

Paradox of choice

A lot of research has been done to find out what our decision-making process influences and a lot of interesting points have been made. A very interesting view on the decision-making process has been made by Renata Salecl called ‘The paradox of choice’. She says that when choices increase, also ‘choice’ anxiety increases. Some anxiety provoking thoughts:

  1. We choose what other people are choosingblog 4444
  2. We try to make an ideal choice
  3. Choice always involves a loss

Salecl argues that this anxiety in combination with the capitalist ideal of the self-made man leads to social paralysis. “Today’s ideology of choice,” says Salecl, “actually pacifies people and makes us constantly turn criticism to ourselves instead of organizing ourselves and making a critique of the society we live in.” Making a choice between different options is often irrational and is often made unconscious. We base our opinions on others which will make our decisions not optimal. Salecl concludes with saying that she is stopped taking choices too seriously.

An interesting video from Renata Salecl: The paradox of Choice:

My Reflection

The decision-making problem that I was facing, where I can reflect on, happened just before the academic year started. I had the opportunity to do my (first) master thesis with a company, to just do my thesis on the university without anything distracting me or I could follow a second master and simultaneously write my (first) master thesis. Like I told you in my last blog I have chosen the last option. It was a difficult decision for me but if I reflect on it a couple months later, I can say I probable made the right decision. Expanding my academic view by doing a second master in Strategic Management opened my eyes that there is a lot more in business outside ‘hardcore’ accounting.  If I reflect on the view of Salecl I can agree on her ‘Anxiety points’ and that too much options makes everything more complicated. But I think that you have to be aware of the anxiety that you are probably facing and that trying to make the ideal choice is very hard. But I don’t agree with her view that you don’t have to take making choices seriously.

If I reflect back on the title of this blog: ’Too many choices?’ and the theory of Salecl I can state that making decisions is difficult and that you probably won’t make the ideal choice. But having less choices would in my view not be more beneficial. And like Harvey Specter said, you have always a lot of choices even if it doesn’t look like that on first sight. And still if you made a bad choice in your life, it is still your choice and if you want another result, make a different decision. Like Harvey would say:

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‘Emotion’ the enemy of ‘reason’?

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When you are making decisions in your life you will always encounter reason and emotion. This blog post will define what is reason and emotion and how this process actually works. I will provide some guidelines from theory to handle your reason and emotion during decision-making. To put this theory into practice I will answer the question if reason or emotion dominates my decision-making process and if this suits my personality? The decision-making problem that I am facing relates to the choice if I am going to pursue a professional career in Accounting/Strategic Management or to become an entrepreneur and start my own company like I explained in my last blog?

When you are talking about reason and emotion you will always get the feeling that they influence each other. You could say, reason is from the mind and emotion is from the heart. When people are thinking of the process of decision-making they usually think that there is not much room for emotion because thinking rational would optimize utility and including emotion would distort this process. But is this the case?

In the YouTube video below you can see an interesting video by Walt Disney (1943) about Reason and Emotion and how it interacts with each other:

Interesting theory

In the last decades a lot of research has been done on the subject of reason and emotion. One interesting article by P. Zimmerman and J. S Lerner from Harvard University called: The emotional Decision Maker’ makes an interesting statement: ‘’before you can even form a thought, emotions are influencing your judgments’’. And they distinguish two types of emotions namely: Integral Emotions and Incidental emotions. Integral emotions are valid decision inputs from a rational perspective because they arise from your personal judgment and Incidental emotions are a not valid decision input because they come from past events and can influence your present decisions. For example new emotions like fear in new decisions are valid but fear from past decisions can influence new decisions which are not rational valid emotions. The authors came up with three solutions to reduce incidental emotions:

1. Diagnose your emotions

2. Absorb other perspectives.

3. Treat each situation as different

 Their major point is that you cannot simple write off your emotions and that you have first to investigate them thorough before you decide what their role is in your decision-making process.

Reflection

Coming back to my own experience with reason and emotion and the decision-making problem that I am currently facing which can benefit from the before explained theory. When I am fully thinking rational the logic decision would be to pursue a ‘safe’ career in Accounting because the job has numerous benefits and in the current economic climate it is a safe bet. But my emotion says that I don’t want to do the same thing for the rest of my life stuck behind a desk. My emotion says to just to take the risk and to start my own company. But if you prepare a cost benefit-analysis you will still find that pursuing a professional career is a logic choice. But following the theory of Zimmerman and Lerner, my emotion would be placed in the category of ‘integral emotion’ which is defined as a rational emotion that is a valid input in the ‘cost benefit analysis’.

Does it help me?

Coming back to the statement: ‘Emotion’ the enemy of ‘reason’?, I can conclude this is not always the case. In some decision-making problems, emotion is a valid input and it is therefore not an ‘enemy’ of reason. It can be a valuable aspect to your personal decision making process. So investigate your emotions before you wright them off. Following Zimmerman and Lerner, emotions are ‘time-tested evolutionary adaptions to universal life challenges’. And when I am thinking of my problem, I will for sure investigate my emotions more thorough so I can include them in my rational decision-making process before coming to a final verdict. Does this suit my personality? I am a rational thinker but maybe I have to give my emotion the benefit of the doubt! Like Steve Jobs would say: ‘Have the courage to follow your heart and intuition, they somehow already know what you truly want to become’.

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‘Dream big or go home’

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Dreams are successions of images, ideas, emotions and sensations that occur involuntarily in the mind during certain stages of sleep’.

But the dreams that I am referring to in this blog post are personal defined ‘dreams’ about a future state of something of somewhat. Dreams that you and I define as something you really desire and would like to realize in the ‘near’ future. Another way to express this kind of ‘dreams’ is to refer to it as: personal wishes. My motivation regarding my personal ‘dreams’ can be best expressed with the quote: ‘Dream big or go home’!

The bigger picture

I think we can define wishes in two ways, namely short term wishes and long term wishes. If you are dreaming of a wealthy life and all the perks that are included with this kind of lifestyle you can see this as a personal long term wish or dream. But to fulfill this wish you have to complete certain steps to reach this goal. The steps to reach this goal can be defined as more short term wishes in this bigger picture. But to realize this dream into reality is a difficult procedure, but there are different theories that can help you with solving this problem.

The spiral of creation

One theory that can help you with realizing your wishes is a theory defined by Marinus Knoope called the ‘spiral of creation’It is a simple and compact model that describes 12 steps that you have to follow to materialize your personal dreams/wishes. To apply this model regarding my own wishes and to apply it in my ‘bigger picture’ I choose to include my short and long term wishes.

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Realizing my dreams

My long term wish or dream is to live a wealthy and social life that gives me satisfaction. But before this long term dream can be realized I first have to realize some short term wishes. One important dream is to finish my masters in Accounting and Strategic Management at Tilburg University. If you apply the ‘spiral of creation’ framework to this wish you can see that I am almost at the end of the spiral at step 10: Persevering. But to fulfill my long term dream I have also other dreams I want to realize in the near future. One of them is to create my own company and to become a successful entrepreneur. And one of my ideas to realize this is to turn my hobby into my ‘work’. The hobby I am referring to is not an ‘average’ hobby as you could say; my hobby is brewing my own beer! I started this hobby with a couple of friends and it has become a fulfilling journey. My dream is eventually to create my own brand and to put this on the market. And because of my business economics background I can turn my gained knowledge into practice in a very interesting way.

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The road to cover

But before realizing my dream I have a lot of road to cover. If you apply the ‘spiral of creation’ framework to my ‘beer brand dream’ you can discover that I am only at the beginning of the circle at step 5: Researching. This framework showed me that I have to actively try to realize my dream and that I have to play a much more active role because my dream will not fulfill itself. But referring back to my quote ‘dream big or go home’, you may think my idea is over ambitious and hard to realize but as Steve Jobs would say: ‘stay hungry, stay foolish’!

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‘Greed‘ is good?

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The ‘in’ famous movie quote ‘greed is good’, from fictional movie character ‘Gordon Gekko’ played by Michael Douglas in the movie Wall Street (1987), is one of the most famous movie quotes that still in today’s world has an influence. A reason for the worldwide crisis can be seen in the essence of this quote and can be expressed as all what’s wrong with capitalism by some critics. This blog post will not proceed on the discussion if greed is good or not, but it will focus on a totally different kind of ‘greed’. The greed I am referring to can be best expressed as ‘Academic greed’ versus ‘Social Greed’.

The definition of greed can be explained as an excessive or rapacious desire, especially for wealth or possessions, which can be explained as a selfish desire to have more of something (especially money). As I mentioned before, my blog will not cover this kind of ‘greed’ but it still refers back to the problem of having ‘more’ of something.

In today’s world, academic grades are more important than ever but in consequence, a balanced work (study)-life balance is also becoming more and more important. Today’s new students have a strict deadline to finish their academic study within a short time frame. But as I experienced in my student live, only focusing on your study will not work and in contrast too much social life will also have a bad influence on your grades. This issue is all about setting personal (study) goals and how it will influence decision making. Setting boundaries is an important part of your personal decision making process as it will guide you to the goal you have set. Without a goal or without boundaries (study) life is difficult.

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A problem Dutch students often encounter is a lack of focus on their study load which is fed by the ‘culture of mediocrity’, which means that just passing your courses will be more than enough. Off course this culture holds back students and the general feeling of laziness is often associated with students. It is difficult for students to find a match between academic life and social life and with the new experience of freedom of students it becomes even harder to reach your personal goals. Therefor setting boundaries is of a huge importance. I came up with some tips that can help you to find a good balance between your ‘academic greed’ and your ‘social greed’:

–          Define your goals

–          Plan social events around your academic schedule

–          Plan study days

–          When studying don’t get distracted

–          Start studying at the beginning of a course and not at the end before it is too late

–          Set personal deadlines for academic work

–          Plan ‘free time’

From my personal experience finding a balance between social life and academic life is a difficult process but an important one. Have always in mind that decision making is a part of life and without your personal boundaries it will become even harder to reach your goals. And referring back to the ‘greed is good’ quote, having personal ambition will only help in finding your inner self.