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Sometimes Your Gut Is the Best You’ve Got

By: Dave Berkus

 

Reasons to Not Make Decisions Today on Gut Instinct

An entrepreneur makes a claim that stretches comfort

You see, women’s clothing is subject to fashion changes so frequently that inventory becomes obsolete quickly.  Add to that knowing that there are three distinct buying seasons each year, and that this site was offering to mix and match sizes to fit, leaving orphan matching skirts and pants – and you can see why my concern.  The entrepreneur–founder explained this problem away by stating that the designers and manufacturers would ship direct after we’d grown to a large enough size.  I had my doubts but led the deal anyway.

But we overcame the fears and…

We raised six million from angel investors for this otherwise brilliant concept, and several first tier VCs followed with another thirty–two million over time.

In the end, you can guess the outcome.

And the company ultimately died a painful death.  It never got its corporate arms around the inventory problem, first among other issues.  And designers or manufacturers never did offer to ship direct.

Looking back at that complete financial loss, I keep thinking of my gut response to the brush–off about inventory being a problem.  To my gut response.

How about you and your gut feelings?

How many times have you had this nagging feeling that an answer to your question just didn’t seem right, but that you accepted the answer because the person offering it was closer to the problem than you were?  It is human nature to do so, deferring to the person more expert or more knowledgeable.

“What if…” we had seen this coming?

Over the course of these insights here and in my BERKONOMICS series of books and blogs, we explore the use of tools to help overcome this natural tendency.  Perhaps the greatest of these is use of the “what if” or “why” question streams.  I admit that I should have taken my own advice for that one and continue much further down the chain of “what if” or “why” questions, let alone doing more due diligence with a handful of designers and manufacturers.

Yes, sometimes your gut is the best you’ve got.  Listen to it!

Published: June 16, 2022
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Source: Berkonomics

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Dave Berkus

Dave Berkus is a noted speaker, author and early stage private equity investor. He is acknowledged as one of the most active angel investors in the country, having made and actively participated in over 87 technology investments during the past decade. He currently manages two angel VC funds (Berkus Technology Ventures, LLC and Kodiak Ventures, L.P.) Dave is past Chairman of the Tech Coast Angels, one of the largest angel networks in the United States. Dave is author of “Basic Berkonomics,” “Berkonomics,” “Advanced Berkonomics,” “Extending the Runway,” and the Small Business Success Collection. Find out more at Berkus.com or contact Dave at dberkus@berkus.com

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