Appendix B: The Decision Checklist (Inversion Edition)

When a decision is expensive, run this checklist. Most of it I stole from Charlie Munger, who got rich largely by avoiding stupidity instead of chasing brilliance.

1. Invert it. How could this fail? How could I make it fail faster? What would regret look like in twelve months? Inversion catches stupidity before it gets expensive.

2. Incentives. Who benefits if this goes wrong? What behavior am I rewarding, in myself and in others? Bad incentives create predictable disasters.

3. Opportunity cost. What am I not doing if I do this? What good thing will I starve? A yes is always a no to something else.

4. Circle of competence. What do I actually understand here from lived reps, and where am I running on stories and vibes? Can I move the decision inside my circle, or bring in someone who lives there? Complexity is often a signal that you’re outside it.

5. Downside first. What’s the worst case, and can I survive it without heroic effort? If not, the answer is no, or not yet.

6. Reversibility. Is this reversible? If yes, move fast and learn fast. If no, slow down, add protection, get a second opinion.

7. One-page clarity. If you can’t explain the decision on one page, it isn’t clear yet. Write the memo, then sleep on it. The yes you give tomorrow morning is almost always wiser than the one you’d give tonight.

Before a big commitment, write a one-page decision memo:

• The decision:
• Why now:
• Alternatives:
• Worst case:
• What would change my mind: