The Six Trap Diagnostic™, explained

At a glance

• The Six Trap Diagnostic™ is the first instrument we run inside the 14-day Diagnostic. It scores six cognitive traps against the company’s actual financials: LIVE, LATENT, or NOT PRESENT, each with evidence.
• The traps are structural patterns in decision-making, not founder failures. They show up in disciplined teams with clean books, which is why they need an instrument rather than an intuition.
• The Scorecard it produces is the foundation artifact. Every downstream deliverable, from the Trapped Value Report to the Three-Path Models, takes its priority from the trap diagnosis.

The Six Trap Diagnostic™ exists because of a pattern we kept hitting: the dollars were findable in the data, but the paths to recover them kept dying in the room. Capital does not get trapped by accident. It gets trapped by decisions, and those decisions are defended by six specific cognitive patterns that operate below the level of any dashboard. Scan the financials without naming the traps and you produce a report. Name the traps with evidence and you produce movement.

What are the six traps?

Each trap is scored independently, against evidence, across cost, pricing, and growth.

1. Sunk Cost. The money already spent gets a vote it does not deserve. The $2.1M of engineering in the product line nobody will kill is the canonical case: the spend is gone either way, but it keeps buying the line another quarter.
2. Status Quo. Doing nothing feels neutral, so allocations roll forward from a context that no longer exists. No one decided to keep the budget. No one decided anything, which is the point.
3. Mental Accounting. The right total hides the wrong mix. The budget is on plan, so nobody asks whether the allocation inside the plan still matches the company that exists today.
4. Anchoring. The first number set becomes the number the conversation orbits. Two market-years after the raise, the plan still triangulates back to the valuation story that justified the round.
5. Loss Aversion. The pain of naming a loss runs roughly twice the value of recovering the capital, so the conversation about the dead line never starts. The trap is not the bad position. It is the unstarted conversation.
6. Certainty Illusion. Polished reporting dresses a dead plan in confidence: clean dashboards, a model with twelve tabs. The polish feels like evidence. It is theater, and it protects the other five traps from review.

How does the scoring work?

Three calls per trap: LIVE, LATENT, or NOT PRESENT. Every call is grounded in specific evidence, a P&L line, a contract, a forecast pattern, or a quoted founder statement. “It feels like sunk cost” is not a finding. Four FTEs allocated to a line below 25% of projected revenue for 14 months, plus the founder saying “we’ve already invested too much to walk away,” is a finding.

The evidence rule is what separates the instrument from an opinion. The data pull happens before the structured interview, the interview tests what the data suggests, and the Scorecard records both. A founder can argue with our judgment. The Scorecard is built so they cannot argue with the evidence.

What does the Scorecard feed?

Everything downstream. The trap diagnosis sets priority for the entire engagement: the Trapped Value Report scans hardest where the traps are LIVE, because that is where the trapped value concentrates. The Three-Path Models get built first on the decisions the trap stack is defending. The day 1 to 90 sequence orders its recovery work by the same map. Diagnose before prescribing is the operating rule; the Scorecard is the diagnosis.

It also sets the floor under the guarantee. Guaranteed 3x your Diagnostic fee in recoverable value, in 14 days. Typical 5x to 10x. We can put money behind that sentence because the traps are predictable: where two or more are LIVE around the same decision, the value is there.

Can you run a version of this yourself?

A self-serve edition, yes. The trap-stack inventory gives you the six live-tests in about twenty minutes, one line each, from numbers you already have. It will not produce evidence-grade scoring, but it reliably tells you whether the full instrument is worth running. If the inventory turns up two or more live traps pointing at the same decision, that decision is where a Diagnostic starts, and the first 14 days shows exactly what happens next.

Related reading:

• The trap-stack inventory
• Trapped value in stalled portcos
• The first 14 days: the operational scan