On today’s episode, Kyle Grieve discusses powerful mental models from systems thinking and mathematics and applies them directly to investing and life. He breaks down concepts like feedback loops, kill criteria, scale, compounding, randomness, and regression to the mean to show how they shape real-world outcomes. He'll also share practical frameworks for improving decision-making, managing uncertainty, and positioning your portfolio to benefit from long-term compounding.

IN THIS EPISODE YOU’LL LEARN:
00:00:00 - Intro
00:03:23 - How feedback loops stabilize or reinforce outcomes in investing
00:10:11 - How kill criteria help you make predetermined decisions in a noisy world
00:14:09 - Why the cone of uncertainty is useful for evaluating conviction and position sizing
00:17:33 - How scale changes the behavior, costs, and risks of a growing business
00:25:06 - How algorithms clarify which inputs drive the conclusions you rely on
00:30:20 - How to evaluate a company’s ability to reach critical mass and become self-sustaining
00:35:35 - The hidden forms of compounding that are just as powerful as the visible ones
00:40:02 - Why power laws should influence your portfolio concentration
00:43:12 - How randomness shapes investing outcomes, and how to take advantage of it
00:51:24 - Why regression to the mean matters during periods of strong or weak performance

Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences.

BOOKS AND RESOURCES
<ul>
 <li>Join the exclusive <a href="https://www.theinvestorspodcast.com/mastermind-2/">⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠TIP Mastermind Community⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠</a> to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members.</li>
 <li>Buy Thinking in Systems <a href="https://www.amazon.com/Thinking-Systems-Donella-H-Meadows/dp/1603580557?crid=12CPBPK4KOH0S&dib=eyJ2IjoiMSJ9.nGtz7jXKD6bUKvWQAPK-ccYHNZZmnv_vjqDpG8_t7_w1fomQXLt7MKFuNV4c6XdErKXEgzqV16rlkuuyupMbPv12nQ7wtutGAvST9X5ass5Pz5ZkjvlR0kDV3SclAlfCFVlqhRtULcuy59cy_sSkslYD4ZqZpzBaCf7MQHZVAGrLCc1YaPKsU7Yxt9F2aZh90ShMBIM9KJ4vLW51mbrYubfmrjOxlcusNgcVaj9PlgY.fJiOQAO8yL0EtMXYcWfTaTteXAIVo_6KHE8yRDUEVNo&dib_tag=se&keywords=thinking+in+systems+donella+meadows&qid=1764014875&sprefix=thinking+in+systems%2Caps%2C175&sr=8-1&linkCode=ll1&tag=tipnetwork-20&linkId=83e6c00baa12affdf0c6bf324648c1ba&language=en_US&ref_=as_li_ss_tl">⁠here⁠</a>.</li>
 <li>Buy The Great Mental Models Vol 3: Systems and Mathematics <a href="https://www.amazon.com/Great-Mental-Models-Systems-Mathematics/dp/0593719999?crid=2NOKDBKDSJCW5&dib=eyJ2IjoiMSJ9.jBr5u9BwvL1PcTIGWAv-6ZUSJogCQcNGQuy4JsiKWJWxD_liBZLTZI9hpqAmM5FY20Nb1O41VFEf7LkjO5Hlj3A97aYBt2jZx-NGcta-Ndr5nPUOZytfwskVnxtf6lCrEEF2zSpF5DX3NC41DsV8v5WE48JDv_xf7qxHDtsYkNKNPMEN6_Ei8_fkJP9NVR4ie6NY73gR-tDnDn4ohk1jYNIs1CISyWa-UsyorPMkRk8.PsuKh0uXm1iVY0-Fb_5Un4yln3f5-PmDFhBsKF9pgHQ&dib_tag=se&keywords=the+great+mental+models+volume+3&qid=1764014864&sprefix=the+great+mental+models+volume+%2Caps%2C217&sr=8-1&linkCode=ll1&tag=tipnetwork-20&linkId=2103aaf7f5b65682ca949b339d6cef7e&language=en_US&ref_=as_li_ss_tl">⁠here⁠</a>.</li>
 <li>Buy Quit <a href="https://www.amazon.com/Quit-Power-Knowing-When-Walk/dp/0593422996?crid=1JYLF9I2QVSD0&dib=eyJ2IjoiMSJ9.-KVQVC-Dma5r9DLU3s7hFUouhPthPqcAXlooQYei6TLDdkFeXrDAgJOkzBvVBagJrRNJcD7ROF2oEqVzOYtKgT0LiWvLWu5Vgh9eXa_w1Ig.C5y-khHwYOxUmaTrrUkVJ3WQNo9ZyaSXSV-teY34hUg&dib_tag=se&keywords=quit+annie+duke&qid=1764014882&sprefix=quit+annie+duk%2Caps%2C174&sr=8-1&linkCode=ll1&tag=tipnetwork-20&linkId=d95694e74f8f8cc973b058c95d818a6a&language=en_US&ref_=as_li_ss_tl">⁠here⁠</a>.</li>
 <li>Listen to my interview with Annie Duke <a href="https://www.theinvestorspodcast.com/episodes/the-art-of-decision-making/">⁠here⁠</a>.</li>
 <li>Follow Kyle on <a href="https://twitter.com/IrrationalMrkts">⁠⁠⁠X⁠⁠⁠</a> and <a href="https://www.linkedin.com/in/kylegrievetip/">⁠⁠⁠LinkedIn⁠⁠⁠</a>.</li>
 <li>Related <a href="https://prodcast.io/collections/we-study-billionaires-the-investor-s-podcast-network">⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠books⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠</a> mentioned in the podcast.</li>
 <li>Ad-free episodes on our <a href="https://premium.theinvestorspodcast.com/">⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠Premium Feed⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠</a>.
</li>
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