There's a strange gap between confidence and evidence. The people who accomplish unusual things often can't point to a rational reason why they'll succeed—they just feel certain before the proof exists. That's partly what makes them willing to try when everyone sensible is calculating the odds and walking away.
This matters because most of us have been trained to match our self-belief to our track record. We think confidence should be earned through credentials and past wins. But that creates a catch-22: you need some baseline belief to attempt hard things, yet you can't build a track record without attempting them first. The successful people Naval is describing short-circuit this by believing in themselves before the results justify it—almost like a self-fulfilling prophecy.
The non-obvious part? This isn't about toxic positivity or ignoring reality. It's about recognizing that moderate, cautious self-doubt is actually a luxury many people can't afford if they want to build something. The delusion he's describing is less about ignoring evidence and more about not being paralyzed by the very real possibility of failure. It's the difference between "I might fail" and "I will probably fail so why try"—and that gap is where most things never get started.