(Usually Visual)

(Usually Visual)

(Usually Visual)

grace@pacecapital.com

Grace Kasten

Based in NYC, investing at Pace Capital, writing here about startups, culture, technology and design

(art by Sabine Marcelis, Robert Mapplethorpe, Iris unknown)

(art by Sabine Marcelis, Robert Mapplethorpe, Iris unknown)

Based in NYC, investing at Pace Capital, writing here about startups, culture, technology and design

Earlier this year I wrote about a widespread aversion to holding firm beliefs / opinions: 


In an internet era where people are quick to judge, and even worse, turn against you for believing in something different than the mainstream expectation, it is easier (and much more forgiving) to default to a summary of facts and current affairs and some obvious forward looking “takes.” If things go wrong / not according to plan, having aligned with the consensus decision and following the rules according to the pack never gets you punished… but it also makes it difficult to ever actually get ahead. Committing to an idea, to a set of actions… requires a deeper type of thinking. What do you actually believe in? Are you willing to stand by this publicly? Have you done the work such that you have real information to make your case? Research and memorization is a different exercise than reflection and analysis. Related, I tend to believe the latter form of thinking creates great investors over a long time horizon (horizontal frameworks instead of domain-specific expertise).


My thinking since then has changed, at least slightly. While I still believe that the concept of conformity exists stronger than ever, its space is not one that is defined by no belief at all. Instead it is characterized by extreme opinion and fast judgment, with little room to hold other ideas true simultaneously (let alone shift entirely). This kind of thinking arguably equally represents nothing at all – yet is far more dangerous given the vehement / violent ways these ideas get expressed. The most obvious manifestation of this right now is Israel / Palestine, which I will not cover in detail but will point to a really great piece written by my friend Cole a few days ago here (doc).


I am definitely not immune to this kind of thinking – in fact there have been several moments recently in which my inclination to judge has been severe, sort of scary. I don’t like this side of myself, yet am also grateful for it. My taste (in objects, in ideas, in people) is distinct – developing a precise perspective has always felt natural and usually leads me in interesting + unique directions. It can (and has) also lead to wrong conclusions. 


This industry is one that rewards extremely fast decision making, often without perfect information, and it also one that rewards taking an opinion and holding it true when others think it is wrong – unwarranted premiums even get assigned to this stance which is also a dangerous slope. Founders have to be fast to decide, usually speed rewarded more than correctness – with tens, hundreds, or thousands of people reliant on any individual decision in a day, getting to that answer and enabling the resulting flow of work to happen can be more valuable than slow contemplation over what is right. A decision is a series of decisions that can be made / course corrected after the first one.


As an investor, most time is spent in conversation with other people – founders, researchers, students, etc. There actually does exist space for slow internal thinking and exploration (this is how a lot of good investors spend time), but if you’re playing a game of treasure hunting that accelerates with more information, the motion involves a lot of quick judgment on use of time and an ability to place people. I’m not implying that to be good you need to be transactional – actually the opposite. Knowing where to invest time (or capital) is important, but without real meaning or commitment tied to that thing, I don’t think you can find legitimate economic or personal success in this field, and it would also be unfulfilling. Investing in fewer deeper relationships I think is right, but you need to determine which relationships warrant that level of care. As a young investor, I am trying to hone my ability to make these decisions. As I reflect on how my thinking has developed, being in this industry for a long enough period of time has in some ways forced me to over-cultivate my disposition for judgment, in ways that lately feel more detrimental than rewarding. This disposition has saturated my work as an investor and, I increasingly notice, my personal life. I’m trying to catch myself.


This level of judgment doesn’t only apply to people, but also applies to ideas. The more time you spend thinking about any given concept, the more you learn, and inevitably the more you see constraints and get concerned about feasibility. It is so easy to get jaded. The best investors over time seem to be ones who are able to keep the mind of a child – constantly open to possibility even if that possibility has proven not to work before… even crazier if you’ve personally lost by indexing to that idea previously. Vinod Khosla comes to mind as maybe the best example of this. Like the definition of insanity, he is willing to make the same mistake repeatedly until it works… always more shots on goal. Psychotic feigned innocence. He frequently cites the George Bernard Shaw quote, “all progress depends on the unreasonable man." Even after getting slammed by the KiOR investment (and many others), he continues to build exposure to synthetic bio / clean investments in the KV portfolio. 


Skepticism and judgment are parallel sides of a coin, the other side of which is receptivity and taste. I’ve veered on the darker (first) side lately and my hope is that by writing this I will be inspired to flip more frequently to the other. Like Vinod! One approach I will be taking is to listen more rather than jump to exclaim. Not everything in the head needs to be shared immediately.


Earlier this year I wrote about a widespread aversion to holding firm beliefs / opinions: 


In an internet era where people are quick to judge, and even worse, turn against you for believing in something different than the mainstream expectation, it is easier (and much more forgiving) to default to a summary of facts and current affairs and some obvious forward looking “takes.” If things go wrong / not according to plan, having aligned with the consensus decision and following the rules according to the pack never gets you punished… but it also makes it difficult to ever actually get ahead. Committing to an idea, to a set of actions… requires a deeper type of thinking. What do you actually believe in? Are you willing to stand by this publicly? Have you done the work such that you have real information to make your case? Research and memorization is a different exercise than reflection and analysis. Related, I tend to believe the latter form of thinking creates great investors over a long time horizon (horizontal frameworks instead of domain-specific expertise).


My thinking since then has changed, at least slightly. While I still believe that the concept of conformity exists stronger than ever, its space is not one that is defined by no belief at all. Instead it is characterized by extreme opinion and fast judgment, with little room to hold other ideas true simultaneously (let alone shift entirely). This kind of thinking arguably equally represents nothing at all – yet is far more dangerous given the vehement / violent ways these ideas get expressed. The most obvious manifestation of this right now is Israel / Palestine, which I will not cover in detail but will point to a really great piece written by my friend Cole a few days ago here (doc).


I am definitely not immune to this kind of thinking – in fact there have been several moments recently in which my inclination to judge has been severe, sort of scary. I don’t like this side of myself, yet am also grateful for it. My taste (in objects, in ideas, in people) is distinct – developing a precise perspective has always felt natural and usually leads me in interesting + unique directions. It can (and has) also lead to wrong conclusions. 


This industry is one that rewards extremely fast decision making, often without perfect information, and it also one that rewards taking an opinion and holding it true when others think it is wrong – unwarranted premiums even get assigned to this stance which is also a dangerous slope. Founders have to be fast to decide, usually speed rewarded more than correctness – with tens, hundreds, or thousands of people reliant on any individual decision in a day, getting to that answer and enabling the resulting flow of work to happen can be more valuable than slow contemplation over what is right. A decision is a series of decisions that can be made / course corrected after the first one.


As an investor, most time is spent in conversation with other people – founders, researchers, students, etc. There actually does exist space for slow internal thinking and exploration (this is how a lot of good investors spend time), but if you’re playing a game of treasure hunting that accelerates with more information, the motion involves a lot of quick judgment on use of time and an ability to place people. I’m not implying that to be good you need to be transactional – actually the opposite. Knowing where to invest time (or capital) is important, but without real meaning or commitment tied to that thing, I don’t think you can find legitimate economic or personal success in this field, and it would also be unfulfilling. Investing in fewer deeper relationships I think is right, but you need to determine which relationships warrant that level of care. As a young investor, I am trying to hone my ability to make these decisions. As I reflect on how my thinking has developed, being in this industry for a long enough period of time has in some ways forced me to over-cultivate my disposition for judgment, in ways that lately feel more detrimental than rewarding. This disposition has saturated my work as an investor and, I increasingly notice, my personal life. I’m trying to catch myself.


This level of judgment doesn’t only apply to people, but also applies to ideas. The more time you spend thinking about any given concept, the more you learn, and inevitably the more you see constraints and get concerned about feasibility. It is so easy to get jaded. The best investors over time seem to be ones who are able to keep the mind of a child – constantly open to possibility even if that possibility has proven not to work before… even crazier if you’ve personally lost by indexing to that idea previously. Vinod Khosla comes to mind as maybe the best example of this. Like the definition of insanity, he is willing to make the same mistake repeatedly until it works… always more shots on goal. Psychotic feigned innocence. He frequently cites the George Bernard Shaw quote, “all progress depends on the unreasonable man." Even after getting slammed by the KiOR investment (and many others), he continues to build exposure to synthetic bio / clean investments in the KV portfolio. 


Skepticism and judgment are parallel sides of a coin, the other side of which is receptivity and taste. I’ve veered on the darker (first) side lately and my hope is that by writing this I will be inspired to flip more frequently to the other. Like Vinod! One approach I will be taking is to listen more rather than jump to exclaim. Not everything in the head needs to be shared immediately.