This is going to sound counter-intuitive, but the best way to reduce bias is to highlight it.
You are biased. I am biased. Even your pet dog is biased.
We have biases – and they aren “t actually all “bad” things – they make us who we are and help us make the decisions that we do. They are generally formed around our frame of cultural and situational reference.
It “s no surprise that a good number of investment funds are made up of people who come from similar backgrounds, and make investments in people and companies with products and cultures they can relate to.
So to fix this, its pretty simple – call it out.
Whenever you notice yourself or your colleagues automatically approving something because of one bias (or passing on something for another), add in a buffer to make it more neutral. Some of the larger firms require multiple people to chair an investment prospect for exactly this reason, keeping each other accountable.
If you “d like to make this a fully blind review, before looking at a deck or a business plan, have an assistant remove the pictures/names from the team page in pitch decks before looking at them. This way you “ll evaluate the opportunity on its merit.
Then, when meeting any team, it won “t matter whether the team is young, old, female, from your college, or whatever other bias you have, you “ll be primed to listen to them.
And this is where it comes down to something that all your preparation simply can “t overcome: If you “re not “feeling it” in the meeting, then you likely won “t invest anyway.
Investment is like a marriage, and if you don “t like your partner, it isn “t going to work.
Originally Posted: https://www.quora.com/What-are-some-effective-ways-to-reduce-unconscious-bias-when-analyzing-startups-as-an-investor
Originally Posted On: 2017-03-10