Rookie Reply: Stop Making Excuses in Business & How to Develop a “Scout Mindset”

Ashley:
This is Real Estate Rookie show number 68. My name is Ashley Kehr and I am here with my cohost, Tony Robinson. Hey, Tony. How are you today?

Tony:
I’m doing well, Ash. We had a really cool switch up for today’s episode, so I’m excited to get into this for the listener.

Ashley:
Yeah. So, this is Saturday. Happy Saturday, everyone. This is the Rookie Reply. Usually, it’s just me and Tony babbling away about something real estate.

Tony:
Shooting the breeze.

Ashley:
But today, we are bringing on an author and guest, Julia Galef, and she is going to talk about mindset.

Tony:
Yeah. So she’s got a book called The Scout Mindset. It’s a really cool concept, but it’s basically about how some people do themselves a disservice by being so committed to their ideas that they pass up on potentially good advice and insights from other people and how you can shift your mindset to be more of a scout with your ideas to just make a better decisions in life.

Ashley:
Yeah. I think you guys will find it very interesting as to… She doesn’t have a real estate background at all, so that’s why we worked with her to tailor these as to how can The Scout Mindset help real estate investors. So, make sure you guys take a listen and then let us know on Facebook and the Real Estate Rookie Facebook group what you guys think about these kinds of episodes and maybe we can incorporate more of them on Saturdays.

Tony:
Julia, thanks so much for having us on the podcast today. We super, super excited to have you on.

Julia:
Oh, my pleasure. Great to be here.

Tony:
Yeah. So this is a new thing for us. So, you’re on one of our Saturday episodes. Usually, it’s just Ash and I talking real estate shop, but you’ve got, I think, a really cool perspective to bring to the podcast now. You’re not known for being a real estate investor.

Julia:
Thanks.

Tony:
You are an author. You’ve got a really cool book coming out.

Julia:
Not quite.

Tony:
Yeah. You’ve got a cool book coming out that we’ll talk about, but you’re here to talk to us mostly about mindset today. So we’ll touch on that in a bit, but I guess before we do, just give our listeners a little bit of background on who you are, Julia.

Julia:
Sure. Yeah. So my name is Julia Galef. I’m an author and podcaster. I have a podcast called Rationally Speaking. For several years, I taught educational workshops on improving reasoning and decision making. I also give talks about it and do some consulting as well. So this is my main focus in my career, is how do we improve our reasoning and our decision-making. The book that I wrote, my first book coming out April 13th is called The Scout Mindset. It’s about the most important things that I learned from this process of, in the past 10 years, studying how to improve our reasoning and decision-making.

Tony:
I love it. One of the things that I always say, Julia, and Ashley and I both say this is that what holds a lot would be or aspiring real estate investors back, it isn’t that they don’t have the technical knowledge or they don’t understand the steps that they need to take, but it’s that they’re missing something on the mental side, right? There’s some kind of mental block or obstacle that’s holding them back from taking action. So you’ve got a really cool framework that I want to get into. So, you mentioned the name of your book, it’s called The Scouts or The Scout Mindset. So, what is that? Just walk us through it from a ground level.

Julia:
Sure. Yeah. So The Scout Mindset, to simply put is the motivation to see things as clearly as possible, to see what’s really there, as opposed to seeing what you wish was there, what you want to see. It’s part of the framing metaphor of my book in which soldier mindset is my term for the mode that we humans are often in by default, where we’re motivated not to see what’s really there, but to defend our preexisting beliefs or defend something we want to be true against any evidence or argument that might threaten it. The metaphor comes from the fact that if you just look at the way we talk about reasoning or talk about disagreements in the English language, the language is all very militaristic. We’ll talk about a strong belief or an unshakeable belief, almost like it’s a fortress that we’re trying to protect.
When someone makes an argument that we don’t like, we try to poke holes in it or shoot it down or rebut it, which is also a military term. Also, in this metaphor, when we change our minds about something, the militaristic language for that is all about admitting defeat. You conceded a point, that’s like ceding territory in a battle. Or even the word admitting is like admitting the enemy into your fortress or your city. And so, that’s why I used the term soldier mindset for this thing. I’m not the first person to identify this phenomenon. I’m sure people are familiar with it under different names, like rationalizing or wishful thinking or motivated reasoning or confirmation bias. These are all facets of what I’m calling soldier mindset.
And so, scout mindset is my term for the alternative to this, because a scout’s role is not to attack or defend. A scout’s role is to go out there, see what’s really there and form as accurate a map of possible of what’s really there and the terrain and the situation. And so, you may have preferences about what’s true. You may hope to learn that there’s a bridge across the river where you need to cross, but most of all, you want to make sure you see what’s actually true. So you don’t want to draw a bridge on your map when there actually isn’t a bridge in reality.

Ashley:
Could you give us a real life example of those two mindsets and how each different person would handle that scenario?

Julia:
Sure. Before I do that, I’ll just add this clarification that even though I talk sometimes about scouts and soldiers, it’s not like some people are perfect scouts and other people are perfect soldiers. We’re all just a mix of both, but I think some people are better than average at being in scout mindset when it counts. And so, sometimes I’ll just say scouts to refer to people like that, but I don’t think anyone’s perfect, certainly not me. So example of scout mindset, it’s just so many ways in which this can manifest, but it can come up when you’re dealing with or seeking out feedback about what you might be wrong about or what you might be doing wrong as a leader or as a romantic partner. And so, a scout would be more inclined to actually seek out feedback about, “What am I doing wrong?” or “What do you think I could improve on?”
Also, a scout would go further than that bare minimum and really actually try to make sure the other person feels comfortable telling them the truth, because often, I find it’s easy to pat yourself on the back for asking for feedback, but to ask it in a way that the other person feels like they have to just tell you the thing you want to hear anyway. So, a scout would bend over backwards to make sure they’re actually hearing the truth and not just what they want to hear. This is something I struggle with myself. So I noticed when I was teaching workshops, I knew it was important to get feedback from my students about how things were going and if they were understanding things and having fun and so on. And so, I went and asked them, “How are things going? Are you enjoying the workshop?” And so, I felt very proud of myself.
And then I noticed that when I was asking people these questions like, “Are you enjoying the workshop?” I was nodding at them like, “So, are you having fun?” I caught myself holding my thumbs up at one point. And so, I liked this example even though it’s not very flattering to me of… Because it shows this tension between the soldier and the scout mindset in us. Because on the one hand, I did want to hear the truth about how things were going, even if it was bad. But on the other hand, I really wanted to protect my image of myself as a great teacher and a great leader. And so, I was putting my finger on the scale when I was asking the question. And so, one aspect of scout mindset is really bending over backwards to try to make sure you’re not doing that, that you’re not fooling yourself.

Tony:
So Julia, what are some of the benefits of having a scout mindset versus that soldier mindset? You talked about what they are, but why should I strive to be a scout over a soldier?

Julia:
Well, the main reason is just because it gives you better judgment. Just like a scout, having an accurate map of the terrain makes it easier for you to choose which way to go and how to avoid the pitfalls and how to get to where you’re going more quickly. The same thing is true in real life. The more accurate your picture of yourself and your strengths and weaknesses and what actually makes you happy instead of what you think should make you happy, the more accurate your picture of the business landscape out there, and what are the odds of success like, “What’s my best guess that the odds of success of my current business plan? Should I be trying to improve it or should I scrap it entirely and come up with a new business plan?”
There’s just countless decisions that we have to make on a day-to-day basis and just bigger decisions in our lives about what to do, that the way the quality of those decisions really depend on how accurately you’re perceiving the situation. And so, scout mindset is all about giving you that accurate picture without distorting it based on what you wish was true. So, I can talk a little if you want about why people don’t automatically do that, but that’s the goal of scout mindset.

Tony:
Let’s talk a little bit more about the how of making this happen. You talked about some of the benefits. I think we can all agree with that, right? There’s a benefits to making sure that you’re not making a decision just because it was your own thought. You’re making a decision because it’s the right decision to make. So if I’m someone that’s really got this soldier mindset, where I’m very territorial over my ideas and I have a hard time accepting other points of views and I find myself making bad decisions because of that, how can I start to make the transition towards more of this scout mindset?

Julia:
Yeah. So the thought experiment I mentioned is one tool to help you notice if you’re in soldier mindset or scout mindset, but we also need tools to make it easier to shift into scout mindset into a place where you want to honestly see the truth and not just defend your views. And so, one example of that strategy that I talk about in the book is… So I talk about how all of us as humans, we need these things I call coping strategies. So when there’s something, a stressful decision or something we’re worried about or maybe something we feel guilty about or ashamed about, we need a coping strategy to deal with that emotion. By default, we tend to reach for a self-deceptive coping strategies often, where that could be like maybe my project failed or I didn’t make the sale or something. I feel bad about that, and so I’m going to reach for something, tell myself to feel better, the coping strategy.
There are a lot of coping strategies that are not rooted in truth like, “Well, that wasn’t my fault because that customer was an idiot. And so, he didn’t know what he was doing. So I don’t have to feel bad about that.” Or maybe, “Well, it was my fault because by my spouse has been really demanding lately. And so, I didn’t have the time to really devote to…” Whatever. There’s so many things you can tell yourself that may or may not be true. What I point out in the book is that there are also tons of coping strategies that make you feel better that are true, and you don’t have to resort to the self-deceptive approach. If you just take a little more care and a little more time to try to find something that makes you feel better that’s also true, then you won’t be distorting your judgment so much. You won’t be distorting your map so much.
So if your sale didn’t close or something and you feel bad about that, a potential true thing you could tell yourself to feel better is, “Well, yes, that failed, but I’m closing more sales than I used to. So I’m on an upward track, even if I’m not at perfection yet,” if that’s true, hopefully that is true. Or you could tell yourself, “Well, it failed, but here’s some useful things I learned from the experience and that’s going to make me better in the future.” And so, maybe that makes you feel better if that’s true. And so, I think this is an important, like a central part of being a better scout is finding ways to not need soldier mindset so much. Does that make sense?

Ashley:
Yeah, it definitely does. My follow up to that would be is how do you stay confident then, especially when you have those times where you have the scout mindset and then it doesn’t work out? How do you stay confident?

Julia:
Yeah, this is actually something I hear a lot. People are often concerned that there is an inherent tension between being a good scout and being confident. They have this image in their mind of someone who’s very realistic and recognizes all the uncertainties, recognizes all the potential flaws in their plans. As a result, that person seems very wishy-washy and unconfident and not competent. And so, this is one of the reasons people are resistant to being a scout. I think this is actually a mistake, an understandable mistake, but still a mistake. And so, to explain why, I like to describe the story of Jeff Bezos when he was first deciding to quit his job on Wall Street in the ’90s and start the company that would become Amazon.
So Jeff Bezos is, in a lot of ways, I think a good example of scout mindset, because he likes to think really realistically about risks and odds and not deceive himself about those things. And so, when he was deciding to start Amazon, he asked himself, “What do I actually think is the probability that I’m going to succeed if I do this?” His best guess was maybe 30%, which it’s not actually that bad when it comes to the success of a new company, it’s better than average, but it’s still less than 50%. It’s odds that most people wouldn’t feel super excited about devoting years of my life to this company.

Ashley:
Especially when you see where his company has come today, like where it’s on today.

Julia:
He definitely underestimated himself, right? That’s part of what’s so funny about it. But at that moment beforehand, when he didn’t know that he was going to be a success and he was just trying to think about the odds realistically. So he gave himself 30% chance of success. You might assume that, okay, if he really thinks that, at least surely he’s not going to say that to investors or to the public or something, because who wants to invest in a company where the founder says, “I think we’re probably going to fail,” but he did. He’s talked about this. He’s written about this in all of his initial pitch meetings with potential funders. He told them, “I think there’s probably a 70% chance you’ll lose all your money, so don’t invest unless you feel like you can afford to lose the money.”
And so, it’s an interesting question, why was he so successful in raising money, not just in that initial seed capital round, but later on too, when he was getting big name investors from the top VC firms and the valuation was going up and up? He kept saying similar things and in immediate interviews as well saying, “There’s no guarantee Amazon’s going to succeed. What we’re trying to do is very complicated. It’s just really hard to predict which companies are going to succeed and which are not. I can’t predict that.” And so, why was he so successful? Here, I finally get to my answer. The confusion that I think people tend to have is conflating two different kinds of confidence. So on the one hand we have what I call epistemic confidence, which is how certain are you that you’re right? How certain are you of the truth or how certain are you of the success of your company?
And so, Jeff Bezos saying 30% is low epistemic confidence, but there’s another kind of confidence that for lack of a better term, I call social confidence, which is just about how poised and self-assured are you? Do you go out and try hard things and be bold and take charge? Do you act like you’re worth listening to? Do you seem to be comfortable and confident in the groups that you’re in? Those two types of confidence, we often assume they have to go together, but they don’t have to because Jeff Bezos had tons of what I’m calling social confidence and a lot of his early investors commented on that. They marveled at how passionate and driven he was and how inspiring his vision of Amazon was. Even though he was saying this vision is not guaranteed to work, he would still show a ton of charisma in talking about his vision.
You can watch early videos of him from the ’90s when he’s talking about, “We’re in the Kitty Hawk stage of internet commerce. This is the best time to be alive and things are going to get crazy.” He’s so animated. And so, that just anecdotally from stories like Jeff Bezos and also from the research that I’ve looked at in the cognitive science literature, that ability to be bold and charismatic and socially confident is actually what seems to make a difference when people are judging whether you’re a good leader or judging how competent you are, how much to trust you. That’s what they’re paying attention to. Whether you have a realistic and uncertain picture of the situation, that’s not going to make you look bad is what I’m saying.

Ashley:
A lot of real estate investors are trying to buy a house from somebody. So, would this be a way that they should approach these sellers as to being like Jeff Bezos and being animated and being driven and showing their passion? This could also work if you’re attracting money too. Are you attracting investors to invest with you? Do you want private money lenders to lend to you? Are these things that you think would be incorporated into real estate well?

Julia:
I mean, there are different kinds of confidence that appeal to different kinds of people. I don’t know. Some people look at Tony Robbins and they think he’s incredibly charismatic, and other people look at him and they think, “Oh, he’s kind of smarmy,” or something. And so, it helps to know your audience, who you’re trying to appeal to. But as a general rule, yeah, finding… This doesn’t come naturally to everyone. It doesn’t come naturally to me certainly, but there are things you can do to increase your social confidence, like practice speaking up in front of crowds of people, practice going out and asking people out or asking, like cold calling people and getting used to rejection so that it becomes less scary to you. All of these things are ways to increase your confidence and thereby your persuasiveness and ability to sell, I would imagine, without having to tell yourself things that aren’t true. And so, a lot of my message is just encouraging people to find these ways to get the things they value, like confidence and influence and emotional comfort without resorting to self-deceptive strategies.

Tony:
So, man, I love everything that you’re breaking down and so much of this, I think, applies to folks that are looking to break into real estate investing, but I want to go back a little bit to… You made a comment when we first started talking about how you were initially trying to get feedback from people at your workshops and that you were smiling and giving them the thumbs up as you were asking for that feedback.

Julia:
Trying to encourage them. Yeah.

Tony:
So, what’s the right way to ask for feedback from people so that you can actually get the honest truth from folks?

Julia:
Mm-hmm (affirmative). So I have a friend who does this really well, better than me. He runs a start-up incubator. And so, he leads teams of people. Every six months or a year, he sends out surveys to the people who work for him, asking about things he could do better or what they’re dissatisfied with, what’s not working. One thing that he does that I really like is he asks the same question in different ways. So he’ll ask, “What could I be doing better as a boss?” And so, maybe people are afraid to give an honest answer to that. But then later in the survey, he also asks, “If you had to pick one thing for me to change, what would that be?” And so, that question, it prompts you like, “Well, if I have to pick one thing.” It’s almost like he’s giving them permission or it’s like he’s removing the ability for them to demur and avoid the question. I think he also actually has made the surveys anonymous and that helps as well because people have less fear of offending him.
So yeah, there’s a lot you can do, I think, in the way you ask questions to signal to people, “I genuinely want an honest answer and I’m not going to penalize you for it.” And then, of course, the other important thing is you have to not penalize people for telling you the truth that may not be pleasant to hear. That’s always hard, but you have to just really push yourself to thank them and remember, “If I act offended, then I’m cutting off my ability to get honest feedback in the future. So, that’s another big part of it as well.

Ashley:
For rookie real estate investors, there’s so many different meetups out there, so many different ways to not work with other investors, who should they be networking with? Should they be connecting with other people who have a scout mindset already? Is there anything advice you can give them as to how to decide who are the people that I want to network and connect with?

Julia:
Yeah. So there’s some obvious things, like some people are just really well connected or have some access to something that’s really useful to you, but I think it’s also important to not lose sight of this other criteria and that it’s good to pay attention to, which is just do these people in my network helped me be a better version of myself or a worse version of myself? And so, what I mean by that is… My examples are less from real estate networks, but just in general, when you’re building an audience or building a network of potential clients or customers, or when you’re starting a company or building a community, you make these choices all the time about what kind of people to attract and what kind of people to repel because you can’t attract everything or everyone. As I was saying about Tony Robbins, certain personalities are going to attract some people and turn other people off and that’s true of all personalities.
So, you make these choices, whether you’re thinking about them consciously or not. You can choose by demonstrating scout mindset, by demonstrating an intellectual integrity and intellectual honesty. That will naturally attract other people who appreciate that and will thank you when you say, “Well, actually that thing I told you last month, it looks like that was wrong. So let me revise that now and tell you what I think is more accurate.” That’s something a lot of people respond well to, but not everyone. Some people will be like, “Oh, well, you shouldn’t have been wrong in the first place.” I don’t think that’s realistic, but some people will get mad at you anyway.
And so, you can just decide over time that the people you want to have in your network are the people who appreciate the intellectual integrity and honesty. I think that makes it much easier to either sell to them or collaborate with them, because you don’t have to be facing this tension between being honest and realistic on the one hand and being persuasive and appealing to people in the other, because for these people that you’ve attracted, being honest and having integrity is the thing that appeals to them. So you’ve given yourself a headwind instead of a, or sorry, a tailwind instead of a headwind there by the people you’ve attracted.

Tony:
I love that advice, Julia. So, I’ve got one other question because we looked at your book briefly before we hopped on the call here. One of the chapters was to lean into confusion. I’m just super curious what that means and if you can break that out for us. I ask that because as someone who’s thinking about getting started in real estate investing, there is so much confusion and I think there’s so much conflicting information. You’re not quite sure which way to go. So I’m just curious what that means and if you can break it down for us.

Julia:
Yeah. So the specific kind of confusion I was referring to in that chapter is when the world contradicts your expectations. So for example, if you think of yourself as a great teacher and you get your student feedback forms and they’re negative, that’s a surprising and confusing… “I don’t understand. Why did I do badly? I thought I was a great teacher.” And so, the temptation is to try to fit, shoehorn that results back into the narrative that you already have to try to make it make sense. And so, you come up with some explanation that resolves the confusion like, “Well…” This actually happened to me when I was first starting teaching. And so, I got lower ratings than someone else who I thought was the worst teacher than me, which was confusing and weird.
And so, the explanation I came up to resolve that confusion was, “Well, he’s teaching them a subject that is easier than my subject. And so, that’s why they like him better,” which maybe, that could be true. But I think it’s good to recognize that you got to confusing results, that confusing thing happened and just hold onto that. And then over time, if you notice enough surprising or confusing results, that might cause a paradigm shift where it just changes your picture of what’s going on. Maybe you realize like, “Oh, actually, maybe I’m not a good teacher” or, “Oh, actually, this assumption that I had about the best way to sell to someone, maybe that actually isn’t true.” But in order to have that realization, you need to actually notice and acknowledge the things that don’t fit what you expected under that assumption.

Tony:
I absolutely love that thought process, Julia, because so many people who get into real estate investing, they have those kind of confusing, conflicting moments, I think, all the time, because before you get your first deal done, there’s a lot of fear and anxiety. It’s just like really, really big, scary thing that’s going to happen. But as you start taking the steps towards getting that first purchase, you realize that it’s not as scary as you thought it was, right? You’re like, “Oh, man…” The process of getting your first house are you get pre-approved, and then you find an agent, and then you submit an offer, and then you do this. It’s like every step of the way you realize that there was all of this scariness you had built up and tension you had built up around this thing, but when you actually did it, it’s not as scary as you thought it was, and how you mentioned, the more of those you have, the easier that it becomes.

Ashley:
That can turn to with finding deals. You can get your offers denied, rejected, and you can keep making up excuses, “Well, that other persons, they’re probably paying all cash. I can’t pay all cash,” and making excuses as to why your offer isn’t getting accepted, instead of trying to, “Okay. What do I need to change to get my offer accepted?” instead of just making excuses as to why they weren’t.

Julia:
Right. I find it helps to approach these situations with just a genuine spirit of curiosity. This is a puzzle. I want to figure out the answer to this puzzle. That curiosity can help move you away from the feeling of defensiveness, where I want to defend myself against this possibility that I might’ve been wrong.

Ashley:
Well, Julia, thank you so much for all of your-

Julia:
Oh, my pleasure.

Ashley:
… insight today. Yeah. We really enjoyed switching up the podcast today and learning some more about a mindset shift we can have. So, why don’t you tell everyone where they can find out more information about you and definitely more about your book.

Julia:
Yeah. Thank you so much. This was great fun. It was cool to see my ideas applied to a domain that I’m not that familiar with, which is real estate investing. So, thank you for that. Yeah. My name is Julia Galef. My website is JuliaGalef.com. It has links to my podcast, Rationally Speaking, and to my book, The Scout Mindset. So there’s a page on my website about The Scout Mindset. Also, if you just google The Scout Mindset, you can pre-order it. It’s coming out April 13th, but you can pre-order it now, or the audio book, if you prefer listening to things on Amazon.com or on Penguin Random House’s page, The Scout Mindset.

Ashley:
Well, thank you so much, Julia. We really enjoyed having you on the show.

Tony:
Absolutely.

Ashley:
Makes sure, everyone, check out her book, The Scouts Mindset, available on your website. Thanks again. We really enjoyed having you here.

Julia:
Yeah, my pleasure. Thanks guys. Take care.

Ashley:
I’m Ashley @wealthfromrentals, and he’s Tony @tonyjrobinson on Instagram. Makes you guys join our Facebook group. We keep growing and growing. It’s so awesome to meet all of you rookies. If you liked this episode, let us know and maybe we’ll do a couple of these every once in a while. Thank you guys for listening and we’ll see you next time.