Welcoming Annie Duke to First Round

How this renowned retired poker player & decision-making expert is helping us refine our process and support founders in our community.

By: Josh Kopelman

The longer I’ve been an investor, the more I realize how humbling this job is. These past 18 years of backing incredible founders have shown me and my partners at First Round that there’s always room for surprises — sometimes on the upside, sometimes on the downside. At its core, building mental models and frameworks to evaluate outlier potential is outrageously hard.

A few years ago now, I tuned into a podcast episode where that capacity to be surprised was brought into sharp focus. Hearing renowned retired poker player and decision-making expert Annie Duke talk about concepts like resulting and why luck and skill are so easily confused struck a chord. I immediately picked up a copy of her book “Thinking in Bets,” and quickly tore through it.

For me, Annie’s lessons from the world of high-stakes poker had strong parallels to venture. Take this paragraph from the book’s introduction:

“Those world-class poker players taught me to understand what a bet really is: a decision about an uncertain future. The implications of treating decisions as bets made it possible for me to find learning opportunities in uncertain environments.”

As investors, it’s easy to fall into the traps — rather than lean into the learning opportunities — of our uncertain environment. With a sometimes decades-long feedback loop, we can get caught up in the week-to-week pace of making discrete investment decisions, instead of refining rubrics and systems to better guide a decision-making process. Even the very habit of reflecting back and trying to assess prior calls is challenging, as dynamics like confirmation and hindsight bias cloud your assessment of your own decision quality.

To paraphrase Daniel Kahneman’s new book, “Noise: A Flaw in Human Judgment,” (another incredible read in this field), improving our “decision hygiene” is critical to reducing the “noise” around the decisions we consistently make.

At First Round, we’ve always been obsessed with constant reflection and improvement. Our pre- and post-pitch discussion and decision-making processes have evolved over the years as we’ve tried new techniques and brought different perspectives into the partnership. What’s remained constant from the early days of First Round is that we’ve treated our investment decisions and overall process as a product.

But after familiarizing ourselves with Annie’s work, it became clear that we could refine our “product” even further and introduce more rigor. For the last three years, Annie has been a key part of our team — and during that time she has had a transformational impact on our decision-making process.

She’s helped us create decision-making rubrics, build systems to reduce bias from our decision-making, and improved our data collection so we can conduct retrospective reviews post-decision. And after years of doing this work in the background, I’m excited to publicly announce Annie’s role as First Round’s Special Partner, focused on Decision Science.

Photo of Annie Duke against dark background

In this unique capacity, Annie is helping us refine the way in which we make investment decisions, drawing on her incredible set of experiences as a student of cognitive science at the University of Pennsylvania, a professional poker player who made millions in tournament games, and now as a bestselling author and decision strategy consultant.

Annie has also been a wonderful addition to our community, sharing her toolkit with emerging angel investors by teaching classes in our Angel Track program for example. In addition to her incredible decision science support for the First Round team, I’m perhaps even more excited about how Annie’s role will expand to support our founders as well.

Building an enduring company is ridiculously hard. From all the small decisions that define great products, to the “bet the company” strategic gambles, there are countless tough calls that fall on a founder’s shoulders.

Just as we have partners who’ve developed deep experience in product strategy and go-to-market motions, Annie will share her expertise and coach First Round-backed founders through frameworks to help them make the very best possible decisions as they build incredible companies. (For a preview of the decision-making advice she shares with founders in the First Round community, be sure to check out this article featuring Annie in The First Round Review today.)

In our time working closely together, I’ve been continually amazed by the learning opportunities that Annie has helped the First Round team unearth. The impact on both our ability to evaluate previous decisions and make better ones in the future is already clear.

But as Annie often reminds me, this effort to make higher-quality decisions by reducing noise and bias is a constant work-in-progress — and to quote the final sentence of her book, if we “keep learning and calibrating, we might even get good at it.”

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