The Pareto Principle

The Pareto Principle states that roughly 80% of effects come from 20% of causes.

Loss Aversion

Loss aversion is our tendency to feel the pain of losing something roughly twice as intensely as the pleasure of gaining the same thing.

The Prisoner's Dilemma

The Prisoner's Dilemma shows how two rational people might not cooperate even when it's in their mutual interest to do so.

Opportunity Cost

Opportunity cost is the value of the best alternative you give up when making a choice.

The Innovator's Dilemma

The Innovator's Dilemma explains why successful companies often fail not despite doing everything right, but because of it.

The Peter Principle

In hierarchical organizations, employees tend to be promoted until they reach a position where they can no longer perform competently.

Network Effects

Network effects occur when a product or service becomes more valuable as more people use it.

Goodhart's Law

Goodhart's Law explains why metrics lose their usefulness the moment you start optimizing for them directly.

First-Mover Advantage

First-mover advantage is the competitive edge companies gain by being the first to enter a new market or introduce a new product category.

The Butterfly Effect

The butterfly effect describes how tiny initial changes in complex systems can lead to dramatically different outcomes.

Black Swan Theory

Black Swan Theory explains how rare, unpredictable events with massive impact shape our world far more than we realize.

Occam's Razor

Occam's Razor is the principle that the simplest explanation that fits the facts is usually the correct one.