On a misty morning on Ganryu Island, Japan’s most famous swordsman, Miyamoto Musashi, was late. This was no ordinary appointment; it was a duel to the death against the esteemed Samurai Sasaki Kojiro. When Musashi finally arrived, unkempt and armed with a crude wooden oar he had carved on the boat ride over, he wasn’t just being disrespectful. He was executing a strategy. By the disruption of expectations, he took psychological control before a single blow was struck. Kojiro, rattled and impatient, was defeated with a single, decisive strike.

This story has always fascinated me. While historical accounts love to focus on these tactical gambits, Musashi’s own writings tell a different story. Musashi believed victory wasn’t found by reacting to others, but by mastering oneself. This, I believe, is a lesson that is very valuable in venture investing.

The Temptation of Reaction vs. The Discipline of Action

In his classic guide to strategy, The Book of Five Rings, Musashi’s one of Musashi’s core messages is about maintaining an unshakable mind. “When your opponent is hurrying recklessly,” he writes, “you must act contrarily and keep calm. You must not be influenced by the opponent.”

Think about how this applies to our world. The market is our opponent, and it is almost always “hurrying recklessly.” It tempts us with frantic funding cycles, rampant, ill informed speculation, whispers of can’t-miss deals, and terrifying downturns. An investor, could be swayed by every feint. They chase deals out of FOMO and get spooked by shifting sentiment, disrupt their logic based on small tidbits of unsound information. Musashi teaches a different path. He advises that when an enemy shows aggression, you should “not mind in the least,” but instead project a calm, unwavering confidence. This isn’t about arrogance; it’s about having such deep faith in your own preparation and principles that another’s actions cannot dictate your state of mind.

He uses a powerful metaphor for this state of being: a swordsman who has mastered the Way can “suddenly make [his] body like a rock, and ten thousand things cannot touch him.” For an early-stage investor, this is the ideal. It’s the ability to watch the chaos of the markets unfold, secure in the knowledge that your strategy is sound. So how do we build this rock-like mind? Musashi’s lessons offer a clear blueprint.

Master Your Process, Not the Market’s Mood

First, we must dedicate ourselves to our craft. Musashi preached relentless practice, “day by day, and hour by hour.” For us, this means dedicating ourselves to our investment strategy. It means constant learning, refining, and understanding our circle of competence, rather than chasing hot sectors or reacting to news. Your process is your sword; it must be honed daily until its use becomes second nature. This dedication builds the foundation of confidence needed to remain calm under pressure.

Adapt, Don’t Just React

Musashi chose the wooden oar to face Kojiro to gain advantage. It is speculated (as Musashi never commented on it) that Musashi realized his Katana (Japanese long sword) wouldn’t match well against Kojiro’s Nodachi (The longest of Samurai swords). He needed a longer weapon. He also likely knew that his use of the oar would be perceived by Kojiro as immensely disrespectful. Finally, the use of the sword represented a departure from Musashi’s ‘two sword’ approach, where he often wielded both his long and short sword simultaneously. A likely surprise for Kojiro, which would have affected his strategy and composure.

Musashi’s use of the wooden oar shows a brilliant adaptability. It was a choice made from a position of strength and planning, not reactively. In venture investing, this is about knowing when to pivot—not because of fear, but because you’ve identified a genuine opportunity to seize or problem to be solved. It’s about finding those unique “corners” Musashi spoke of, where you have a distinct advantage and can act on your own terms.

Separating Signal from Noise: The Observing Eye

Musashi’s clearest and perhaps most profound advice for a strategist is to learn how to see properly. He warned, “Pay no attention to trifles.” For the modern venture investor, this is the ultimate challenge: tuning out the overwhelming cacophony of industry noise to focus on the few things that are true signals.

Noise is the daily, seductive chatter: the sensationalist tech headlines, the hype on social media, the gossip from other investors. It creates a sense of urgency and triggers emotional, reactive decisions. The signal, on the other hand, is the underlying reality of a small company. It’s the quality of the founding team, the product-market fit, the unit economics, the character of the CEO. The signal is quiet, slow, and requires patient study.

Musashi made a vital distinction between two ways of seeing: the observing eye and the perceiving eye. The perceiving eye, he argued, is weak; it gets caught up in interpretation, fear, and doubt. The observing eye is strong; it simply sees what is truly there. The investor who uses a perceiving eye is constantly thrown off balance by noise. The investor with an observing eye has the discipline to see past it.

This is the essence of another one of his powerful teachings: “Perceive that which cannot be seen with the eye.” He wasn’t being mystical; he was talking about looking past the superficial to understand the underlying mechanics of a situation. For us, this means not being fooled by a pitch deck (the visible) but investigating the team’s execution capabilities (the invisible). It means ignoring the panicked headlines about a sector and focusing on the long-term viability of your thesis.

He gives us a practical mental model for how to do this: “In strategy it is important to see distant things as if they were close and to take a distanced view of close things.”

• “See distant things as if they were close”: Your long-term investment thesis, your core principles for evaluating business opportunities, the slow-moving technological shifts—these are the “distant” signals. You must bring them into sharp focus and make them the primary drivers of your decisions.
• “Take a distanced view of close things”: The latest hot deal, the news of a competitor’s funding round, the sudden shifts in sector popularity—these are the “close” distractions. You must step back and view them with detachment, recognizing them as temporary and often meaningless trifles.

By cultivating this mindset, you are doing more than just ignoring distractions. You are actively training your mind to focus only on what matters.

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Ultimately, Musashi’s genius was a blend of deep self-mastery and astute situational awareness. He understood his opponents, but he refused to let them dictate the terms of engagement. His actions were guided by his own preparation and unwavering principles. For those of us navigating the uncertain world of investing in venture market companies, the lesson is clear: Build your skill, refine your diligence, and cultivate a steady, disciplined mindset. Treat the market’s melodrama as the “trifles” Musashi warned against. Prepare yourself so thoroughly that when a true opportunity presents itself, you can act with the same decisive clarity as the master swordsman on Ganryu Island.