In economics, we say markets become more efficient with broader distribution of information. What allows business to get ahead is not just execution but also information. It influences decision-making, pricing, and a whole host of problems. To surface more information enables one to better execute.

But it’s impossible to have all the information in the world. People keep secrets or withhold information to gain an advantage, info isn’t kept in records properly, or it’s impossible to record information in a way that’s useful. It’s one of the central premises to why AI can’t replace all human knowledge gained from years of experience in business; people don’t document everything, it takes years to build experience, and it also builds wisdom and intuition.

I build my businesses around anything involving information asymmetry and solving that asymmetry. That asymmetry is where businesses make profit. You can attribute the niches of information asymmetry to neat business terminology like network effects building a large community (i.e. Facebook, marketplaces like farm auctions) or years of wisdom (e.g. Oracle NetSuite/ERPs, B2B SaaS startups/consultants that learn problems through experience and build products solving the problems they’ve seen from clients). Overall, these are all categorically due to who knows the most information.

There’s a catch: you can never know all the information in the world. That’s where instinct and intuition plays which is built on wisdom. A great example is Moneyball; it’s a book/movie about using statistical analysis and baseball theory to build a talent team. There’s a reason why teams haven’t fired scouts and replaced them with economic graduates completely. You need both information and experience to judge. There’s the player statistics from games and possibly a machine learning model to guess a player’s future trajectory once they graduate from high school or college. But someone needs to pull the trigger to make the hires and see where to fit people. You can’t tell whether someone can improve simply based on statistics. There’s a famous scene from Moneyball where the scouts talk about a player’s attitude (e.g. a player partying too much) and not liking the way someone swings. The scouts were right about the former (based on my interpretation) but the statistician was right about not caring how someone swings but about what they’ve proved.

Anything involving the need for information — deciding monetary policy, making business strategies — requires a bit of intuition in addition to the backing of information.