The Red Car Theory: Why We Miss Opportunities.

A short explanation of the red car theory:

The Red Car Theory is about the power of perception. It starts with a simple idea: when you’re thinking about buying a red car, you begin to see red cars everywhere. The key point is that the number of red cars hasn’t actually increased. Instead, your mind has become more aware of them.

The concept is similar to The Texas Sharpshooter Fallacy.

Here’s how it works: our brains are inundated with information, and are constantly filtering them out. We can’t pay attention to everything at once, so we focus on what’s relevant to us. When you start thinking about red cars, they become relevant. As a result, you start to notice them more frequently.

These two concepts illustrate a broader psychological principle: How our thoughts and intentions shape what we perceive in the world. When something is important to us, our brain makes it a priority. This phenomenon is also known as selective attention.
The Red Car Theory can apply to many aspects of life. For instance, if you’re learning a new word, you’ll start to hear it more often. If you’re interested in a particular topic, you’ll find it popping up everywhere.
In essence, the Red Car Theory shows how our focus can influence our perception. It’s a reminder that what we pay attention to can shape our experience of reality.

Here’s a nice video explaining the red car theory: 


Now to apply this to business, if we are not tuned to looking for opportunities we will not notice how numerous they are. Opportunities are numerous, however not all of them lead to success, most of them can lead to wasting money and time if not managed correctly, that’s why most people instinctively ignore opportunities. 
That’s precisely what makes entrepreneurs special, they are willing to take the risk and pursue these opportunities. 

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Abdallah Alaili

I'm a serial entrepreneur (mostly tech) and micro-investor (tiny), this is a blog to learn from other entrepreneurs and spread the wisdom to many more. You can find me on: Instagram - Twitter - Linkedin - more about me