“You are the average of the five people you spend the most time with.”
This is a quote that is often shared as sound advice. While trite, I think it has merit, and I try to adhere to it the best I can.
When I moved to New York, one of the goals I set for myself was to spend more time with people who were more successful than me. [1] Entrepreneurs, investors, and operators were at the top of that list.
After a few months of network building, I found myself at a small six-person dinner where everyone fit the above criteria. I was the odd man out.
Dinner involved great conversation; we discussed our ambitions, how we spend our time, what motivates us, etc. But on my walk home, I felt sad. I kept comparing my outcomes to those of my new friends and was disappointed that I wasn’t as successful as they were.
After my three-day pity party, I decided to snap out of my funk and figure out why their outcomes differed from mine. I made a list of all the qualities that the five people at dinner had—intellect, integrity, energy, ambition, ability to learn, creativity, etc.—and compared myself against it.
At the risk of sounding arrogant, I felt generally on par when it came to every quality except one: They had a bias toward actions with big impacts. [2] [3]
I know it’s reductive to say that our different outcomes can be boiled down to thinking big and acting on it. Success and wealth are multivariate; there are numerous factors at play, including luck.
But I also know that having a critical lens toward myself enables me to identify where I fall short and reflect on how I can improve. Doing so will increase my probability of favorable outcomes. This is what inspired today’s essay: how our beliefs impact the actions we take.
The link between beliefs and actions
People who have earned success are all action-oriented. Being action-oriented simply means understanding causality. If you want a certain outcome, a certain input is required.
I won’t belabor this point, because intuitively, most people get it. What is more interesting is understanding what causes us to choose one action over another. How do we determine which actions to pursue?
When I was in college, I wanted to get into finance. My motives were to learn, make money, and enjoy the prestige associated with a career in finance. However, underlying that was also a belief that I could get a job in finance and do well. If I didn’t think I had a chance, I wouldn’t have tried.
My beliefs spurred action.
I networked hard, creating a massive Excel sheet filled with the personal details of every banker I met, as well as their contact information. I kept in touch with them the best I could and eventually built enough meaningful relationships to start a career in finance.
I tell this story only to contrast it with one that was shared at the dinner I attended.
One of the dinner participants (let’s call him “Bob”) was a founder who was looking to raise another round of money for his start-up. Bob had recently attended a conference where he’d met a bunch of potential investors. He explained that he had an Excel sheet containing information about investors he’d met and that he planned to use this sheet to stay in touch with them.
Bob was doing the exact same action I had used to get into finance—the same tool, same manner, and same level of effort—but the potential outcomes of our actions were exponentially different. My best case was a good-paying job working long hours. His best case was a massive cheque that could change the course of his business. [4]
This is when I started to think about how our beliefs impact our actions and, thus, our outcomes.
Belief —> Action —> Outcome
The framework I use to think about beliefs and actions is this: Your beliefs direct your actions, which impact your outcomes.
It is important to briefly define beliefs.
Anything that arises in the mind is a thought. Beliefs are thoughts that we trust to be true. You typically have thousands of thoughts going through your head on any given day, but you only accept as real and act on thoughts you trust.
Let’s tie this back to my earlier example:
Belief: I can get a job in finance
Action: Create an Excel tracker, send cold emails, etc.
Outcome: Secure a job in finance
Based on this, it is clear how our beliefs about ourselves impact our outcomes.
The next question to pursue is, can we change our beliefs?
From my experience, the answer is yes.
We are certainly not born with preset beliefs. Our beliefs build over time as we live our lives and have different experiences. Our experiences, actions, and outcomes impact our beliefs. So, the framework from earlier needs to be updated.
The diagram above depicts a feedback loop indicating that current beliefs drive actions, leading to outcomes that reinforce these beliefs.
The scale of your beliefs can also change. A pattern of small wins will slowly start to impact how you perceive yourself and the beliefs you hold. After a series of small wins, your beliefs might change drastically, leading to powerful beliefs with big actions.
Alignment of beliefs and outcomes
Why does this matter?
You need to align your beliefs with your desires and ambitions. If you want outsized success, you need to have beliefs that are conducive to that. If you want to be a successful investor, founder, or operator, you need to believe you can be those things.
I certainly have limiting beliefs about myself. [5] While belief change is possible, it is hard. The key is to understand which of my current beliefs are limiting me and to focus on slowly changing them. Perhaps this way, I will fit in at dinner next time.
Notes, Inspirations & Additional Readings
Thanks to Kerri & Darragh for their review and feedback.
[1] The definition of success is ambiguous and personal. My definition of success is a function of owning my time, doing interesting work that is fulfilling and wealth.
[2] Maybe I’m wrong and this is too arrogant a view. It’s hard to have the exact data points needed to reach a more definitive conclusion. Perhaps my ignorance is why our outcomes are different?
[3] It is worth noting that big actions are correlated with risk. So, another way of looking at this is that they are better at taking smart risks.
[4] Getting a job in finance can also change the trajectory of your life. But the impact is small vs raising a round of money from the right investor.
[5] One of my limiting beliefs is that I need more “experience” to do something big. If you want to do something big, perhaps the best experience is to just do it? Another is fear of failure. I tend to be competitive and compare myself to others, which is helpful at times, but also makes me be afraid of falling behind.