Polina Pompliano is the author of HIDDEN GENIUS: The Secret Ways of Thinking That Power the World’s Most Successful People. She is also the founder of The Profile, a media organization that studies successful people and companies.
Listen now and learn:
- Why mental models are more important than life hacks
- How to problem solve in a crisis
- The difference between systems-based and outcomes-based thinking
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Show Notes
Polina Pompliano is the author of ‘HIDDEN GENIUS: The Secret Ways of Thinking That Power the World’s Most Successful People.‘ She is also the founder of The Profile, a media organization that studies successful people and companies.
Previously, she spent five years at FORTUNE where she wrote more than 1,300 articles and earned the trust of prominent investors and entrepreneurs. As the author and editor of Term Sheet, FORTUNE’s industry-leading dealmaking newsletter, Polina interviewed the industry’s most influential dealmakers, including Melinda Gates, Steve Case, Chamath Palihapitiya, and more.
In this conversation, Polina and I discuss a wide variety of mental models and thought patterns that can be implemented throughout your personal and professional life. Here is my conversation with Polinao Pompliano about the many mental frameworks of successful individuals she explores in her book.
Here are my notes from our conversation.
Mental Models and the Power of Consistency (1:30)
A common thread in Polina’s weekly newsletter, The Profile, and her new book is that high performers don’t use tricks or hacks…they use mental frameworks.
It’s easy to find articles in your social media feed about the routines and habits of highly successful people – cold plunge at 4 a.m., meditation, specific diets, etc – but following those habits doesn’t guarantee success. There’s no doubt that healthy habits are good for you. But tiny hacks to optimize your day aren’t as impactful as long-term thought patterns implemented throughout your personal and professional life.
When asked about her favorite mental framework she covers in her book, Polina quotes entrepreneur/investor Reed Hoffman: “Consistency plus time equals trust.” It’s an idea that applies to all facets of life, but particularly to relationships.
Try thinking about a personal or professional relationship in your life where you trust a person who consistently breaks their promises to you—that person doesn’t exist. Once a person lets you down two or three times, they lose your trust.
Polina also talks about how this applies to her commitment to publishing her newsletter every week, something I can certainly relate to from publishing a podcast every week. We both understand that life will get in the way whether it’s travel, illness, unexpected personal or professional responsibilities. But we’ve earned the trust of our audiences because we keep the consistency going.
Storytelling (8:00)
When asked if she had a favorite chapter, Polina noted that the early feedback she has received on her book is that people really like the second chapter, which is on mental toughness. Her favorite chapter, however, is on storytelling.
A theme throughout the book is perspective and identity. The storytelling chapter begins with the idea of how we’re all unreliable narrators of our own life because nobody looks at themselves with a high degree of objectivity.
She shares one of the anecdotes from her book about Aaron Sorkin, who has written many great films and television series. In the book, Polina specifically explores Sorkin’s thoughts on The Social Network. Sorkin explains that he wasn’t particularly interested in technology or startups, but he enjoyed the idea of weaving different layers of perspectives to the point at which the viewer has a hard time discerning the one ultimate source of truth. Sorkin saw that there were multiple versions of the truth depending on a character’s perspective.
Similarly, in our own lives, there are multiple versions of the truth and your perspective is not the only one. We often think of ourselves as the main character in all of the narratives that play out in our life, but we are the supporting character in everyone else’s story.
Circling back to the theme of identity and perspective, Polina wanted this chapter of the book to highlight the flaws in being the sole narrator of our life and be more empathetic to the viewpoints of others and what role we play in their narratives, similar to the quote from Robert Evans: “There are three sides to every story: yours, mine, and the truth.”
Systems-Based Mindset vs Outcomes-Based Mindset (11:00)
One thing that struck me while reading Polina’s book was that she used so many examples that I had always thought about from strictly an investment perspective, but there are so many broad applications in life to these ideas.
It’s easy to deconstruct any mistake and conclude, “I made this mistake and it led to this bad outcome, so I’ll never make that mistake again.” That type of outcome-based mindset might help prevent you from making that particular mistake again, but it doesn’t necessarily prevent you from making future mistakes.
A systems-based mindset looks at the entire process to avoid making hundreds of future mistakes like that one. If you’re only focused on the outcome, you can only win one thing at a time. But if you’re focused on the process, you can win many times.
When I’m talking about investing with people, so many people think so much about the outcome in determining whether a decision was good or bad. But out of random chance, you can make a great decision that leads to a bad outcome and a bad decision that leads to a good outcome.
Problem-Solving in a Crisis (14:30)
Polina shares the story of Chris Hadfield, an astronaut who once went blind while doing a spacewalk outside the International Space Station due to the cleaning substances for his visor getting into his helmet. As Chris tells the story, it would be very easy to panic and make the problem worse, but instead, he began listing every potential option he had until he reached a rational solution.
I’ve always loved this story from an investing standpoint because losses are incredibly normal and our natural instinct in times of market turmoil is to panic. But the moment you begin to panic, your animal instincts kick in and cause you to think with emotion rather than logic.
There is always a different “investing crisis” to worry about. Different headlines and stories will get different people worried. When this happens, it would be better to think of all the things that are within your control. My personal favorite is your financial plan—if you’re worried about the market or your portfolio, the best first action is revisiting the assumptions of your financial plan.
The other thing Chris Hadfield talks about when he speaks is how astronauts train by exposing themselves to all sorts of problems that might arise during a mission. This type of exposure therapy makes it easier to cope with a bad situation when it arises and, thus, helps you think rationally rather than panic and think emotionally.
Investors could learn from this, too. Anytime I meet with a client, I talk about market losses. We never know when or why they’ll happen, but I always make sure that clients know that they will happen and what that has looked like historically. That way, when market losses begin, clients can say: “Peter told me this would happen and that everything will be okay.”
On a related note, Polina uses one of my favorite Morgan Housel quotes on risk:
“The things that you’re trying to think of are the odds that you will get hit, the average consequences of getting hit, and the tail end consequences of getting hit.”
Defining Success (25:30)
People have an aversion to the word “success” because most of us use traditional definitions of success such as status, wealth, and material possessions.
The people Polina profiles, however, fit her personal definition of success: doing something remarkable, failing, learning lessons, and applying those lessons to the next endeavor, then sharing everything that’s been learned with others.
Resources:
- The Profile, Polina’s weekly newsletter
- Hidden Genius: The secret ways of thinking that power the world’s most successful people by Polina Pompliano
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Long-term investing made simple. Most people enter the markets without understanding how to grow their wealth over the long term or clearly hit their financial goals. The Long Term Investor shows you how to proactively minimize taxes, hedge against rising inflation, and ride the waves of volatility with confidence.
Hosted by the advisor, Chief Investment Officer of Plancorp, and author of “Making Money Simple,” Peter Lazaroff shares practical advice on how to make smart investment decisions your future self with thank you for. A go-to source for top media outlets like CNBC, the Wall Street Journal, and CNN Money, Peter unpacks the clear, strategic, and calculated approach he uses to decisively manage over 5.5 billion in investments for clients at Plancorp.
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