Douglas Adams, the author of The Hitchhiker's Guide to the Galaxy, writes: “Anything that is in the world when you’re born is normal and ordinary and is just a natural part of the way the world works. Anything that’s invented between when you’re fifteen and thirty-five is new and exciting and revolutionary and you can probably get a career in it. Anything invented after you’re thirty-five is against the natural order of things.”
Being open-minded is vital to investing success. The willingness to try and understand opposing views – however preposterous they may initially seem – is essential to ensure sound decision making.
This open-mindedness is especially complicated when there are generational gaps. Our parents may have found it difficult to make sense of Facebook and we may not understand the appeal of TikTok. But we risk missing out on structural societal changes when we retain a sense of dogmatism and remain dismissive of trends that, at first glance, may seem absurd.
Often analysis will confirm our priors, that indeed this new-fangled idea is a fad. But at times that which seemed like a fad may turn out to be revolutionary.
In 2010, Instagram was a small 3-person team developing a picture sharing app with visual filters. The app was dismissed by many as just another fad that would dissipate over time. Facebook however saw the potential, and after a $1bn purchase developed Instagram into the dominant social media platform it is today.
NFT’s and blockchain is another area of absurdity. Digital (nonsensical) images selling for thousands of dollars may seem (and probably is) totally irrational, and most cryptocurrencies will end up worthless. But as investors it behoves us to at least try and understand the underlying technology and mindset behind these crazes. This does not imply one should necessarily buy into these ideas, but at the very least familiarise yourself with the new world.
Being curious is more important than ever now. This does not mean that every insane idea needs to be invested in. But if you don’t take the time to investigate, you may never find the one that transforms the world. As Walt Whitman said: “Be curious, not judgemental”.