Have you heard of the term entrepreneurial emotions? Did you know that up to 99% of the decisions we make are subconscious? Since our decisions drive our behaviors, it’s crucial that we learn to make more of our decisions consciously rather than subconsciously! That’s why I’ve invited my coach, Neill Williams, to share the science behind entrepreneurial emotions. Neill has a master’s in economics and mathematics and is a Master Certified Coach. Neill is uniquely positioned to explain behavior economics—aka, the science behind why we do what we do—and how we can learn to change our emotional response. 

Keep reading to learn the three key concepts that make up the “Trifecta of No,” how the trifecta influences our response to uncertainty and change, and how we can break our entrepreneurial emotions free to make better decisions in our retail businesses. 


Meet Kathy’s Coach, Neill Williams

Neill has always been the self-appointed science nerd in her friend groups. She not only has a master’s in economics and mathematics, but built a corporate career as an actuary (aka, a pro who uses advanced mathematics to measure and manage potential risks of financial investments, insurance policies, and more). 

After she ditched her belief that success was measured in hours worked, Neill was able to achieve true lifestyle freedom while juggling her roles as a mom, wife, Master Certified Coach, entrepreneur, and employee. Now, Neill uses her science background to coach entrepreneurs to be more productive in fewer hours a week.

One thing I love about getting coached by Neill is that she often has a scientific explanation for what I’m experiencing. These evidence-backed explanations make me feel validated, seen, and like I have a better understanding of what my mind and/or body are experiencing as I navigate entrepreneurship.

I genuinely hope you appreciate Neill’s wisdom as much as I do.

Entrepreneurial Emotions

We Can’t Control The Economy, But We Can Control Our Reaction To It

In a recent coaching session, I shared about the Savvy Shopkeeper community with Neill. While I can’t remember the exact context or story I was sharing, I do remember that Neill responded with, “Oh, there’s an explanation for that.” 

She proceeded to share about the “Trifecta of No” and how behavior economics can give us a logical explanation for entrepreneurial emotions and the decisions we make and the emotional reactions we have. 

While understanding that logic is incredibly helpful, I want to acknowledge that things are happening economically—and how those events affect us varies from person to person. 

For example, my mom called me in a panic recently because her water heater was broken. Replacing such an expensive item would be a financial struggle for her, and after growing up poor, I completely understand why her first reaction was panic. 

Neill says that, as a dual-income household with a child, she looks around her community and thinks, “I don’t know how the hell people are making it half the time…the cost of food and the cost of health care, at least for us, those are huge budget items.”

For Neill and her husband, they’ve opted to vacation less or take lower-cost vacations to account for the rising cost of food and health care. She acknowledges that while the economy is “affecting our life in some way, it’s not affecting our survival, which I see that is like a real legit thing that is happening in our country…[and] across the world.” 

“We have very little control over the inflation and all of those things, but what we do have control is our reaction to it,” says Neill. 

Entrepreneurial Emotions

How We Respond To Change (And How That Affects Our Entrepreneurial Emotions)

As independent retailers know, election years can create inconsistent results for their stores. Before November arrives, it’s crucial to understand what’s going on in your brain when things go wonky—as well as what you can do about it. 

Three concepts make up how we as humans respond to change. As Neill shares, “We can either respond to change in a really positive way, or we can respond to change in a way that we’re super resistant and we’re just fighting. 

And these three concepts work together to answer why we approach change the way that we do. If you think about it, I mean, as entrepreneurs, anybody who’s a business owner, you literally are confronted with change every single day.”

Part 1: Loss Aversion

Loss aversion refers to the painful part of change. Psychologically, a loss feels twice as bad as a gain. 

For example, imagine you have a month in your retail business where you meet your revenue goal. That is going to feel amazing! However, next month you don’t meet it. Not meeting that goal will feel very painful compared to the month before. 

Your brain will want to spin out of control about the one month of not making your goal—you might even forget that you’ve hit your revenue goal for the past two or three months in a row. Unfortunately, those months won’t matter because the loss is much more painful. 

This is the same thing that happens when you’re on social media and get far more caught up in the negative comments than the positive ones. The pain of loss is much more intense, and we focus on that pain rather than the joy of our gains. 

While we’d like to believe that we are logical creatures, our brains are only logical around 10% of the time. The other 90% of our decisions and behaviors are determined at the subconscious level. Knowing that allows us to acknowledge these feelings without beating ourselves up over them. 

Part 2: The Endowment Effect

The next part of the “Trifecta of No” is the endowment effect. This refers to our inclination to overvalue what we have or own—we tend to believe that what we have is worth far more than it actually is. 

You’ve probably seen this when a friend goes to list their house and believes it’s worth a cool million…and Zillow says it’s worth 375K. Because of their emotional attachment to their house and the memories made there, they believe it’s worth more than it is. 

When it comes to our businesses, this line of thinking can keep us stuck. For example, we might value our current way of running our business because it’s what we know, even if there are potentially better ways of doing things out there. 

However, you can leverage the endowment effect towards the change you want instead of against the change that’s happening. For example, when buying patterns are different than expected, you can ask yourself how to get customers to shop with you. While you may love how you run your business now, trying something new might help your business thrive. 

Part 3: Status Quo Bias

The last piece of the “Trifecta of No” is the status quo bias. This is when we continue to do the same thing we’ve always done because the outcome we expect feels more predictable and certain. 

In the context of a retail business, the status quo bias might lead us to continue operating our business in the same ways we always have. We ignore that it’s an election year and that the marketplace, environmental conditions, and economy are vastly different than a “regular” year. 

entrepreneurial emotions

Moving Out of the Trifecta of No

Here is how these three pieces work together to form the “Trifecta of No:”

1. We overvalue what we already have, whether that’s our team members, our SOPS, our merchandising style, or our pricing. 

2. We keep doing the same thing we’ve always done (aka, sticking with the status quo) because it’s comfortable. 

3. When we don’t change anything—even when we know the market, economic, and environmental conditions are vastly different!—we don’t meet our revenue goals. That loss is very painful and creates an aversion to change.

When we understand how the “Trifecta of No” affects us, we have a better chance of identifying what’s going on in our brains, understanding why these things are happening, and then changing our entrepreneurial emotions. 

However, it can be challenging to move out of the “Trifecta of No,” especially if your brain has sent you on a downward spiral. One way that you can move out of this spiral is by exploring what you could do instead. Are there changes you could implement for just a season or a year as an experiment? 

Neill believes that getting more awareness of how the “Trifecta of No” is playing out in your business can help you move out of it, too. She recommends asking yourself: 

  • What am I feeling emotional pain around, whether in my business or personally? 
  • What am I overvaluing? 
  • Would I hire these people again? Why or why not?
  • What do I keep doing over and over while expecting the same results? 

You can also do a thought dump, where you write down every thought that pops into your head around your business. Getting all of your thoughts out of your head and onto paper can give you the mental space to decide what to do next. 

Finally, Neill shared this mic drop summing up why the science behind our entrepreneurial emotions matters so much: 

“If we want to elevate ourselves in our lives and businesses, we need to take a hot second to slow down, analyze, and bring to the conscious level the things that we’re doing, the ways that we’re thinking, and the behavior that we are exhibiting.”

Resources

Timestamps

  • [04:26] Meet Kathy’s coach, Neill Willaims
  • [07:17] We can’t control the economy, but we can control our reaction to it
  • [09:32] How we respond to change (and how that affects our entrepreneurial emotions)
  • [13:16] Part 1: loss aversion
  • [17:01] Part 2: the endowment effect
  • [21:16] Part 3: status quo bias
  • [25:08] Moving out of the trifecta of no

Connect With Kathy

Kathy Cruz is an Independent Retail Coach who helps store owners work smarter, profit more, and grow their brick and mortar businesses. 

Connect with Kathy and learn more here:

Website: www.savvyshopkeeper.com 
Instagram: @savvyshopkeeper
Mastermind Group: Master Shopkeepers


Connect With Neill

Neill is a productivity coach helping ambitious entrepreneurs be so productive, 10 hours is all they need. She learned firsthand how productivity leads to more impact, life and job satisfaction, and success by…

  • building a $200k coaching business in 10 hrs/wk while in her demanding corporate job.
  • compressing an intense corporate 60+ hour workweek down to just 30 as a partner in a firm.
  • running her $500k/yr business in 10 hours/wk.

Neill knows that time doesn’t make or break your productivity, you do. She’ll teach you how to leverage your biology and psychology to take control of your time.

Connect with Neill and learn more here:

Website: www.neillwilliams.com
Book: How to Thrive on a 10-Hour Work Week: An Entrepreneur’s Guide
Podcast: Success Genius Team Turnaround Program: Team90

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