Root and derived data
When making a data-based decision, there are often hundreds of data points that you can look at to inform the decision.
However, different types of data points that carry different value. Specifically, there are data points that are the consequence of other data points which also go on to cause other data points, and data points that cause other data points but are not the consequence of any. I call the former derived data and the latter root data.
You can produce and analyze an endless amount of derived data, but it’s the root data that determines the outcome and hence the quality of your decision.
Originally published at Thoughts of a VC.