A lot of problems are solved by doing the hard things on a daily basis: Wake up early, get cold, get hot, move fast, lift heavy stuff, focus, be present, have difficult conversations. Simple playbook to live well.

In 2009, Stanford business professor Tina Seelig split her class into groups and issued a challenge: Each group had $5 and 2 hours to make the highest return on the initial money. At the end, they'd give a short presentation on their strategy. The results were fascinating... Most of the groups followed a basic approach: • Use the $5 to buy a few items. • Barter or resell those items. • Repeat • Sell final items for (hopefully) more than $5. These groups made a modest return on their initial $5. A few groups ignored the $5. They thought up ways to make the most money in the 2 hours of allotted time: • Made and sold reservations at hot restaurants. • Refilled bike tires on campus for $1 each. These groups made a better return on their initial $5. The winning group took an entirely different approach. They had three core realizations: 1. The $5 was nothing more than a distraction. 2. The 2 hours of time was not enough to make an attractive, outsized return with a mini-business (like selling restaurant reservations or filling bike tires). 3. The most valuable "asset" was actually the presentation time in front of a class of Stanford students. Realizing the value of this hidden asset, they offered the presentation time to companies looking to recruit Stanford students. They struck a deal to sell the time slot for $650, netting a monstrous return on the $5 of initial capital. The losing groups thought in linear, logical terms and achieved a linear, logical outcome. The winning group thought differently. So, what can we learn from this story? There are two types of problems: 1. Low-Stakes: Lower potential, linear rewards. Decisions are easily reversible. 2. High-Stakes: Higher potential, asymmetric rewards. Decisions are not easily reversible. With low-stakes problems, given the reward potential is low and the decisions are easily reversible, we can use shortcuts and heuristics to choose our path. We can take a logical, linear approach. With high-stakes problems, the high, asymmetric reward potential means we need to think differently. We want to take a creative, non-linear approach. Three steps to start thinking differently: Step 1: Avoid the Distraction There will always be an "obvious" solution that is simple, clear, and entirely wrong. In the challenge, the $5 was nothing more than a distraction. It was a trap. To find the best path, you have to avoid the distraction. Step 2: Ask Foundational Questions Ask and answer questions that expose and vet underlying assumptions and logic. • What's the real problem you are trying to solve? • What's your hypothesis? Why? • What are your core assumptions? Why? • What evidence do you have? • What are your core options? • What alternatives exist? This takes time, but it's an essential exercise when facing a problem with the potential for non-linear rewards. Step 3: Select the High Leverage Approach Slow down and evaluate the options on the table. Select the path most likely to generate the asymmetric, attractive risk-adjusted returns. If the story teaches us one thing, it's this: Creative, non-linear, asymmetric thinking generates creative, non-linear, asymmetric outcomes. If you enjoyed this or learned something, follow me @SahilBloom for more in future.