A few weeks ago, a friend came to me with a bad idea.
He wanted us to start a dietary supplement and nootropics company together. We would use dropshipping to offload most inventory and management costs, then go to a mutual friend for cheap web design, and then tap into our networks for some surprisingly good sales and endorsement opportunities.
He acknowledged that I have no formal biology background besides AP Bio and watching House. He also had no formal background. This might lead an objective observer to conclude that we were not the best qualified individuals for selling other people chemicals to put in their bodies.
But… we had both started and run businesses successfully. He had had been using supplements and nootropics on a daily basis for years, and had put an impressive amount of effort into understanding them as evidenced by his ability to rattle off chemical components and mechanisms with the slightest prompting. He also had unique access to people who could promote and sell our product.
Most importantly, the entire supplements/nootropics field was in the “Wild West” (his words). Entrepreneurs all over the world were putting out bundled nootropic supplements with names like Alpha Brain and Brain Force Plus, and so if we, in the spirit of scientific adventure, put our heads together and actually tried to run a legitimate company which used only the most scientifically verified substances, we could pass the low bar set by the current market, and then rely on marketing skills and connections to carve out our own little chunk of a two billion dollar industry.
This was a really, really bad idea.
It wasn’t a bad idea in a cynical, amoral, profit-maximizing sense. I’m pretty sure we could have actually made money if we tried.
It was a bad idea because it was a path to becoming borderline-snake oil salesmen.
I wasn’t 100% sold on the concept of starting a dietary supplement and nootropics company at first, but I was excited by it. I wanted to start another company, to build it, to make money with someone I greatly respected and admired. I wanted it to happen.
So it became my really bad idea too.
Like every IQ-obsessed rationalist-ish person on earth, I had on occasion wondered about the viability of nootropics. After a 40 minute phone call with my friend, I finally took the deep dive into the subject and read everything I could find on nootropics for seven days.
Among other things, I read the nootropics Wikipedia page, a dozen other Wikipedia pages on specific nootropics, Slate Star Codex’s 2016 Nootropics Survey Results, Gwern’s discussion of the 40 nootropics he tried, the r/nootropics beginner’s guide to nootropics, a bunch of the top all time posts on r/nootropics, some stuff on the Human Nootropics Index, and a lot of basic neuroscience so I could get a handle on the biological mechanisms. I also talked to a few friends, including a professional psychiatrist.
At the end of the week, my evaluation of the viability of nootropics was updated to:
- A small percentage (5-10%) of nootropics definitely and obviously work (or at least have some sort of effect), but have major negative side effects, often including addiction potential. These include Adderall, modafinil, nicotine, and many pharmaceutical stimulants.
- The vast majority of nootropics (80%+) either don’t work, or have subtle, highly individualized effects. Often, even if they do have positive effects, they are pretty much impossible to verify. These include piracetam, ALCAR,
kratom, noopept, and any exotic root from Zimbabwe.
- A small percentage (5-10%) of nootropics hit the sweet spot of being both effective and not having any serious drawbacks. You can take them every day and they provide a mild desired effect. These nootropics are (IMO) caffeine, melatonin, and maybe L-theanine.
(As far as I could tell, most workout supplements work if you take them the right way, but everyone already knows that and the market is saturated.)
From the perspective of our potential business:
- We mostly couldn’t legally sell nootropics in the first category. What we could do if we wanted to live life on the edge is keep an eye out for emerging nootropics and sell them before the FDA inevitably scheduled them and made their sale illegal. But this was obviously risky and stupid, even by the standards of this entire enterprise.
- We could sell the nootropics in the second category, but it was difficult to do so honestly. Most nootropics companies make outrageously exaggerated claims about the potency and efficacy of their ingredients, though some will at least try to back their claims with (out-of-context) clinical evidence. We could either follow their lead and be slimy, or try to honestly advertise that putting this ground up Zimbabwean root in your tea each morning may-or-may-not produce a very slight augmentation in your focus for the day, though its effects will probably be entirely swamped by the moderate amount of caffeine in your tea.
- We could sell the nootropics in the third category, but everyone on earth knows what caffeine is and how to get it, and anyone who wants melatonin can get it at Walgreens (which includes me for the last five years). So there isn’t really any way to provide a novel or valuable product to customers.
To clarify, I don’t think nootropics are a scam or not worth investigating. But I think they’re something fun for hobbyists to mess around with, and there’s no low-hanging fruit. It’s for people like me who like doing experiments on themselves to have interesting experiences and gain insights into how our bodies work. But, there that aren’t many of these people out there, or at least not enough to support the type of business we were looking to create. The standard purchaser of nootropics, or at least nootropics bundles like Atomixx Blend Limitless Pills, seems to be fitness enthusiasts looking for a consistent boost, not nerds who want to do double-blind experiments on themselves.
This evaluation shifted my sentiments toward the business considerably. I called my friend/potential business partner and expressed my reservations. He’s a persuasive guy, and I guess sometimes I’m a gullible one, because by the end of the call, I was a little more optimistic. The way I saw it, if we were going to try to do this thing, we had two potential paths:
We could buy dozens of raw nootropics, mix them together in a bunch of different ways, and experiment on ourselves to see what works to find the best novel bundled nootropic combination. We could take our time, test it over months, even do double-blind experiments on ourselves and others. We could keep it simple, only use a handful of ingredients in the final product, and use them in sufficient quantities since my friend kept insisting that ordinary nootropic bundles used excessively small doses. We are smart, we can do this better than the good folks who make Mega Brain Boost 5000.
Or we could just say “fuck it,” and put together a bunch of the typical ingredients (mostly caffeine) into a single pill, give it a cool name (we were throwing around “X-alt”), use our endorsements and marketing channels, and then throw it out on to the market. It wouldn’t be bold or innovative, but it could work. We could muscle in on a small slice of the market share, keep costs low with the droppshipping model, and see where it goes. And at least our product would be no worse than any other bundled nootropics company’s.
While my friend and I discussed these two plans, we weren’t on nootropics, but we were huffing a lot of hopium.
On the first plan, another friend of mine finally knocked some common sense into me. If the thousands of obsessive nerds in r/nootropics, the rationalist community, and dozens of communities across the internet hadn’t discovered a truly viable bundled nootropic that outperformed straight caffeine, even after tinkering with these chemicals for decades, then how on earth were my friend and I going to do so in a few months? A little Efficient Market Hypothesis goes a long way to explaining how dumb many business plans are, and my case is no different, especially since Gwern had already elegantly applied the EMH to evolutionary biology and nootropics with the Algernon Argument.
The second plan was more viable, but only in that cynical, amoral, profit-maximizing sense. If we were producing a real product that had real benefits, then I would have no problem with strongarming our way into the market via marketing and endorsements and taking our cut. But…
Would we be selling a real, valuable product? Would our bundled nootropics pill stuffed with caffeine, creatine, L-theanine, and whatever else made us feel good after a few weekends of sloppy experimentation actually bring benefits to our customers?
The correct answer was… we didn’t know. Fortunately, my friend and I were honest enough to admit that to ourselves and each other. We took a few days to mull over the whole idea.
The final death blow to our glorious business plan was Slate Star Codex’s Brief Cautionary Notes on Branded Combination Nootropics which devastatingly argues that throwing a bunch of nootropics into a pill is somewhere between highly inefficient and immoral.
To me, the experience of reading great writing often consists of an author reaching into my subconscious, grabbing something I know to be true but have never articulated, and dragging it to the surface of my mind into a state of explicit conceptualization.
Reading this article at this time was an extremely powerful form of that, almost to an eerie degree. It was like Scott Alexander had listened in on our phone calls and then traveled back in time to write an article about our stupidity.
I swear, my friend and I went through just about every argument in the essay. We reasoned that the nootropics market is mostly awful and it’s easy to clear the current quality threshold. We reasoned that most nootropics have real clinical support. My friend was very adamant that bundled nootropics products tended to use too small dosages. We reasoned that we could just use a small number of nootropics for our bundled package to keep it clean, simple, and high yield (this was the business plan we decided was most viable after our last phone call).
And we were wrong, wrong, wrong, and wrong (though my friend was right about the low-dose thing). Or at least we were dramatically overconfident in ourselves. A part of me definitely knew how wrong we were the whole time (since the first phone conversation), but the excitement, hopium, and sheer wanting-it-to-work bias clouded my mind.
After sharing the article with my friend and reiterating my concerns, he was convinced. We abandoned the project. About two weeks after the first phone call, after three more phone calls and one in-person meeting, we called the business plan off. We cancelled our meeting with the lawyer for next week to set up our corporation. Fortunately, no money was spent, except…
We had already bought a bunch of raw nootropics for our personal experiments. So… I guess we’ll have some fun with that.
So the business plan was a bust. But that’s ok, because on top of learning a lot about nootropics and hopefully gaining a bit of resistance to future hopium doses, the experience helped me reflect on an important and underrated concern… the costs and benefits of announcing ambitious plans to other people.
Let’s say you want to start a business, or apply for a prestigious job, or travel somewhere exotic, or write a novel, or do something else which is memorable and high-status. When you’re still in the planning phase, should you tell other people about it?
I think it’s a tough question. There are tradeoffs to both “yes” and “no” and I’ve never quite figured out the right way to go. Both directions can provide encouragement or discouragement, can raise or lower plan quality, and can lead to higher or lower chances of success.
Let’s say you come up with a big plan and tell all your friends about it. The potential benefits are:
- You get (hopefully) honest feedback on the value and validity of your plan.
- You make yourself accountable to following through on the plan because you’re betting your reputation for honesty and follow-through on your execution of the plan.
- You get encouragement when everyone (hopefully) tells you how good of an idea you have.
The potential costs are the inversions of the above. You might get discouraged if people tell you that your plan is dumb from the start. And just as bad (or worse), you might get dishonestly positive feedback from people who don’t want to disappoint their excited friend/loved one/acquaintance. And, if you fail to follow through on your plan after telling everyone about it, you get a significant reputation penalty. If you tell everyone you’re going to write a novel, and then you don’t, you become known as not only a failed novelist, but as a braggart and irresponsible individual who can’t keep his word, and people will be less willing to trust you in the future.
But I also think there is a bigger hidden potential cost to revealing your plan, one which hinders so many ambitions.
Part or most or all of the reason anyone makes big plans is for social prestige. People don’t just write novels to indulge in pure artistic creation, but to enhance their reputation or acclaim from peers, if not strangers.
However, merely telling people about your big ambitious plans also generates social prestige, albeit significantly less than actually executing the plan. Publishing a novel is very prestigious, but being known as the guy who is writing a novel is also mildly prestigious. It won’t make you as famous as JK Rowling, but it will be a part of your reputation in your friends circle, and it will make people think you’re smart and creative, and possibly a little pretentious.
I think what happens to many people is that they start a big project with the intention of getting a lot of social prestige, then they get the little bit of social prestige from telling everyone about it, then that slakes their prestige lust, and then they lose motivation to complete the project.
So if you are going to go down the path of telling everyone about your plan so you can generate accountability and honest feedback, you need the fortitude to not fall into the prestige trap and see your plan through.
What if you don’t tell anyone about your big plan? What if you come up with an idea and keep it to yourself for days or weeks or months or years while it slowly builds to fruition? I think the main advantages to this strategy are:
- You can abandon the plan at any time without social penalty.
- You dodge the prestige trap.
- You MIGHT gain a sense of quiet confidence and satisfaction from fulfilling your ambitions without anyone’s support.
- Completing a plan without telling anyone about it probably produces a prestige bonus.
The costs of this strategy are the inverted forms of the above plus + the inverted benefits of the opposite strategy. If you don’t tell anyone about your plans, you won’t get any honest feedback nor encouragement. And toiling toward your dreams all alone can be just as discouraging as the prestige trap. And worst of all for most people, you won’t have any social accountability, so the social penalty for failure is non-existent, so the overall penalty for failure is quite low, so you are more likely to fail.
Which path is better? Which way will most incentivize you to complete your plan? Which way will maximize plan value and prestige?
I honestly don’t know. I think it probably depends on individual strengths and weaknesses. But IMO, the prestige trap is the biggest factor for most people. So I recommend that anyone with sufficient fortitude should probably tell others about their plans for the accountability and honesty bonuses, while people without sufficient willpower should keep their plans to themselves and soldier on in obscurity.
So what did I do with my supplement/nootropics business plan?
I engaged in the “tell everyone” strategy. I told six people, and their summarized responses were:
- One (M, 20s) was very excited about it, told me everything he knew about nootropics, and wished me luck.
- One (F, 30s) was very excited, said she knew nothing about nootropics, but wanted to try my proprietary blend as soon as it was ready.
- One (M, 30s, a professional psychiatrist) was very excited about it, suggested that our businesses could actually work together, and asked me to keep him updated.
- One (F, 30s) said that me and my friend didn’t sound qualified, but that she also didn’t know anything about this stuff, so she wished me luck.
- One (M, 50s) said the entire industry seemed like a scam, but he was amoral enough to suggest I would probably make money, so he half-heartedly wished me luck.
- One (M, 20s) said it was a terrible idea, that I had no idea what I was doing, and recommended that I abandon the idea.
After telling them all that I had given up on the business plan (except the first two, who I haven’t spoken to yet), every one told me the idea was stupid and that I made the right move. These reactions gave me pause… I was honestly a little disappointed that they hadn’t had the courage to call me out on my stupidity beforehand. I mean, I sympathize with their failures… it’s incredibly difficult to hurt a friend on purpose, even for their own good, and especially when you’re looking them in the eye and you’ll feel their visceral disappointment. But still, IMO, honest feedback may literally be the most valuable aspect of friendship.
But it’s fine. Their feedback was still helpful since I did my best to factor in that margin of error when I told them my plan and asked for their opinions. I took anything below enthusiastic support as at least mild apprehension. And I took explicit mild apprehension as weariness. And I even took the two explicit apprehensions as implicit deep apprehensions. I always bet on social desirability bias.
I wonder if my reckless association with a bad idea has damaged my reputation with them. Maybe. At the very least, if I ever bring up another business idea, they’ll wonder if it’s another nootropics bullshit thing. Then again, maybe my reputation has improved… maybe they respect me more for admitting I was wrong and pulling myself back from the brink of a mildly costly, possibly immoral endeavor. It’s probably impossible to say for sure.
Looking back from a few weeks later, I’m simultaneously disappointed and proud of myself. I’m disappointed for temporarily indulging in irrational behavior, but I’m proud of snapping out of it before it was too late.
The experience also reinforced my belief that occasional crackpot-ism is a natural consequence of giving ideas serious thought. It’s easy to sit back and assume that all conventional wisdom is true since you’ll be right more often than wrong, but you’ll also miss out on great insights. But to access great insights, you’ll have to grapple with lots and lots of bad ideas to find occasional good ideas. And occasionally you’ll stare at one of those bad ideas for too long, and it will become part of you. The best you can do is engage in self-reflection and bounce your newly-discovered ideas off trusted friends, and see if they survive scrutiny. This one didn’t.
I was wrong. And I committed a decent amount of time and attention to being wrong for a few weeks, and then I stopped being wrong. I can live with that. Hopefully it has made me a better thinker.