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Complex systems are unpredictable and don’t always work as anticipated. There are too many variables and interdependencies to fully understand them. Any input might change the system and some might lead to large unintended consequences. In some cases, the rules of the system might even change completely. A margin of safety acts like insurance against this unpredictability. There is an expected outcome to every action. A margin of safety is the buffer you add on top of the expected outcome in case you are wrong....

Systems are everywhere. A system is “a set of things working together as parts of a mechanism or an interconnecting network” (definition by Oxford Languages). Your hiring process, marketing, sales, and the whole business are all systems. So is how you date, how you stay healthy, etc. Feedback loops are a fundamental concept of system theory. Feedback is information communicated in response to an action. When the output of a system becomes information that affects its behavior, we have a feedback loop at hand....

What are the chances of a specific outcome occurring? That is the leading question of probabilistic thinking. It’s a mathematical concept that defines the field of statistics. But it applies to every field that includes some measure of uncertainty. It’s a great tool for decision-making and any type of risk management. Probabilistic thinking helps you to better forecast the future. From this point onwards, the future is a collection of possible scenarios, but not all of them are equally likely to occur....

Notes on The Knowledge Project podcast episode with Shane Parrish and Kunal Shah. Lessons to be learned from the Indian business cast Kunal: I think the first lesson was, they have much lower shame than the other communities. They have very little self doubt when it comes to being shameless. I mean, they’re very hard to offend. They’re okay even if you mock them. As long as you are giving them business, they’re okay with that....

First principles are the foundation from which any other action or insight is derived from. You can uncover them by asking “why” or using a Socratic type of questioning. You know you’ve got a first principle if you can’t deduce it from other principles. Thinking from first principles means starting from a basis without assumptions or beliefs. Hence, it’s the best starting point for any solid argumentation or deduction. It avoids incorrect beliefs early on and is a robust way of thinking....