Avoiding Bad Decisions
The worst decisions happen under stress—this article explores how Sum Capital applies a simple yet powerful four-step method to regain clarity and avoid costly mistakes in business and investing.
Lessons from the Early Days
Some of the most valuable lessons in decision-making didn’t come from textbooks or boardrooms but from experiences that seemed insignificant at the time.
During my first week at university, I sat in a packed auditorium, surrounded by unfamiliar faces, feeling slightly out of place. The Dean’s Introductory Address was meant to set the tone for the next four years, but one part of it stuck with me far beyond college.
He warned that at some point, amidst the chaos of making friends, balancing academics, and figuring life out, everyone would find themselves in a moment of stress and overwhelm.
And it’s in those moments, he said, that people tend to make the worst decisions.
This is when businesses overreact to short-term turbulence.
This is when investors panic and make emotional trades.
This is when entrepreneurs abandon strategies that just needed more time.
This is when people make rash choices they later regret.
The Dean then shared a simple but profound strategy for avoiding bad decisions in high-stress moments. His advice? Before doing anything drastic, do these four things:
- Take a shower – Reset. Changing your physical state shifts your mental state.
- Eat a healthy meal – Hunger and exhaustion cloud judgment. Get fuel before reacting.
- Get some exercise, preferably outside – Movement clears the mind and restores perspective.
- Get a good night’s sleep – Almost no big decision should be made in the middle of the night. Clarity comes in the morning.
The order doesn’t matter. But the process does.
I’ve applied this approach time and time again—not just in personal moments but in business as well. When the market shifts unexpectedly, when a deal takes an unexpected turn, or when I feel the pressure to react immediately, I pause.
Because I’ve learned that the worst decisions come from stress, exhaustion, or fear, and the best ones come from clarity, patience, and perspective.
If I could add one more piece of advice to the list, it would be this: Every crisis feels bigger in the moment than it does in hindsight.
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