Author: Naval Ravikant and Babak Nivi

ASIN: B086BGN5LF

The book is a basically a transcript of Naval Ravikant's podcasts on his "getting rich" tweetstorm. Great crumbs of wisdom. However, instead of reading this book, read "the Almanack of Naval Ravikant" (I've prepared a book summary as well).

EXCERPTS

Seek Wealth, Not Money or Status

Wealth is assets that earn while you sleep

The reason you want wealth is because it buys you your freedom. So, you don’t have to wake up at 7:00 AM, and rush to work, and sit in commute traffic. So, you don’t have to waste away your entire life grinding all your productive hours away into a soulless job that doesn’t fulfill you. So, the purpose of wealth is freedom. It’s nothing more than that. It’s not to buy fur coats, or drive Ferraris, or sail yachts, or jet around the world in your Gulfstream.

You’re not going to get that unless you really want it. The entire world wants it and the entire world is working hard at it. To some extent it is competitive. It’s a positive sum game, but there are competitive elements to it. Because there’s a finite amount of resources right now in society. To get the resources to do what you want, you have to stand out.

Money is how we transfer wealth. Money is social credits. It is the ability to have credits and debits of other people’s time.

There are fundamentally two huge games in life that people play. One is the money game. Because money is not going to solve all of your problems, but it’s going to solve all of your money problems. I think people know that. They realize that, so they want to make money. But at the same time, many of them deep down believe that they can’t make it. They don’t want any wealth creation to happen. So, they virtue signal by attacking the whole enterprise by saying, "Well, making money is evil. You shouldn’t do it." But they’re actually playing the other game, which is the status game. They’re trying to be high status in the eyes of other people watching by saying, "Well, I don’t need money. We don’t want money." Status is your ranking in the social hierarchy.

Wealth is not a zero-sum game. Everybody in the world can have a house.

Status, on the other hand, is a zero-sum game. It’s a very old game.

On an evolutionary basis, if you go back thousands of years, status is a much better predictor of survival than wealth is. You couldn’t have wealth before the farming age because you couldn’t store things. Hunter-gatherers carried everything on their backs. So, hunter-gatherers lived in entirely status based societies. Farmers started going to wealth-based societies. And the modern industrial economies are much more heavily wealth-based societies. People creating wealth will always be attacked by people playing status games.

The problem is that to win at a status game, you have to put somebody else down. That’s why you should avoid status games in your life because they make you into an angry combative person. You’re always fighting to put other people down, to put yourself and the people you like up.

I don’t think capitalism is evil. Capitalism is actually good. It’s just that it gets hijacked. It gets hijacked by improper pricing of externalities. It gets hijacked by improper yields, where you have corruption, or you have monopolies.

Everybody can be wealthy. Everybody can be retired. Everybody can be successful. It is merely a question of education and desire. You have to want it. If you don’t want it, that’s fine. Then you opt out of the game. But don’t try to put down the people who are playing the game. Because that’s the game that keeps you in a comfortable warm bed at night. That’s the game that keeps a roof over your head. That’s the game that keeps your supermarkets stocked. That’s the game that keeps the iPhone buzzing in your pocket.

A lot of people think making money is about luck. It’s not. It’s about becoming the kind of person that makes money. I like to think that if I lost all my money and if you drop me on a random street in any English-speaking country, within 5, 10 years I’d be wealthy again. Because it’s a skill set that I’ve developed and I think anyone can develop.

Extreme people get extreme results. You can’t be normal and expect abnormal returns.

You won’t get rich renting out your time, because you can’t earn non-linearly. You must own equity, a piece of the business to gain your financial freedom. There are many reasons for that. But the most basic is just that your inputs are very closely tied to your outputs. In almost any salaried job, even at one that’s paying a lot per hour like a lawyer, or a doctor, you’re still putting in the hours, and every hour you get paid. So, what that means is when you’re sleeping, you’re not earning. When you’re retired, you’re not earning. When you’re on vacation, you’re not earning. And you can’t earn non-linearly. So, essentially you’re working for somebody else, and that person is taking on the risk, and has the accountability, and the intellectual property, and the brand. So, they’re just not gonna pay you enough. They’re gonna pay you the bare minimum that they have to, to get you to do their job. And that can be a high bare minimum, but it’s still not gonna be true wealth where you’re retired.

Renting out your time means you’re essentially replaceable. And then finally you’re actually just not even creating that much original for society. You’re not creating new things for society. You’re just doing things over and over. And you’re essentially replaceable because you’re now doing a set role. Most set roles can be taught. If they can be taught like in a school, then eventually you’re gonna be competing with someone who’s got more recent knowledge, who’s been taught, and is coming in to replace you. You’re much more likely to be doing a job that can be eventually replaced by a robot, or by an AI. So, fundamentally your inputs are matched to your outputs. You are replaceable, and you’re not being creative. I just don’t think that, that is a way that you can truly make money.

Businesses that have high creativity and high leverage tends to be ones where you could do an hour of work, and it can have a huge effect. Or you can do 1,000 hours of work, and it can have no effect.

So, you want to look for professions and careers where the inputs and outputs are highly disconnected. The higher the creativity component of a profession, the more likely it is to have disconnected inputs and outputs.

If you’re looking at professions where your inputs and your outputs are highly connected, it’s gonna be very, very, hard to create wealth, and make wealth for yourself in that process.

People living far below their means enjoy a freedom that people busy upgrading their lifestyles just can’t fathom. And I think that’s very important, just to not upgrade your lifestyle all the time. To maintain your freedom. And it just gives you freedom of operation. You basically, once you make a little bit of money, you still want to be living like your old self, so that just the worry goes away. So, don’t run out to upgrade that house, and lifestyle, and all that stuff.

The most dangerous things are heroin and a monthly salary.

Let’s say you’re getting paid $1,000 an hour. The problem is, is that when you go into a work lifestyle like that, you don’t just suddenly go from making $20 an hour to making $1,000 an hour. That’s a progression over a long career. And as that happens, one subtle problem is that you upgrade your lifestyle as you make more, and more money. And that upgrading of the lifestyle kind of ups what you consider to be wealth, and you stay in this wage slave trap.

Ideally you want to make your money in discrete lumps, separated over long periods of time (e.g. You won't make any money for ten years, and then suddenly at year eleven, you might have a giant payday), so that your own lifestyle does not have a chance to adapt quickly, and then you basically say, "Okay, now I’m done. Now I’m retired. Now I’m free. I’m still gonna work because you got to do something with your life, but I’m gonna work on only the things that I want, when I want."

Society will pay you for creating what it wants, but doesn't know how to get, and delivering it at scale.

Figure out what product you can provide and then figure out how to scale it. And if you want to be wealthy, you want to figure out which one of those things you can provide for society, that it does not yet know how to get, but it will want, that’s natural to you, and within your skillset, within your capabilities. And then you have to figure out how to scale it. Because if you just build one of it, that’s not enough. You’ve got to build thousands, or hundreds of thousands, or millions, or billions of them. So, everybody can have one.

It starts as high end. First it starts as an act of creativity. First you create it just because you want it. You want it, and you know how to build it, and you need it. And so you build it for yourself. Then you figure out how to get it to other people.

Entrepreneurship is essentially an act of creating something new from scratch. Predicting that society will want it, and then figuring out how to scale it, and get it to everybody in a profitable way, in a self-sustaining way.

Escape competition through authenticity. No one can compete with you on being you. It’s that simple.

Pick an industry where you can play long-term games with long-term people. All returns in life come from compound interest over many turns of the game. Because every time you reset, every time you wander out of where you built your network, you’re going to be starting from scratch. You’re not going to know who to trust. They’re not going to know to trust you.

Pick Partners With Intelligence, Energy and Integrity

Delegate to people who are actually good at the thing that you want them to do.

When I was younger, I used to try and talk people into things. I had this idea that you could sell someone into doing something. But you can’t. You can’t keep them motivated. You can get them inspired initially. But if you’re trying to keep someone motivated for the long-term, that motivation has to come intrinsically. You can’t just create it, nor can you be the crutch for them if they don’t have that intrinsic motivation.

Integrity. If somebody screws over an enemy, and is vindictive towards them, well it’s only a matter of time before they redefine you from friend to enemy, and you feel their wrath.

We all know people who are consistently pessimistic, who will shoot down everything. That person will not only never do anything great in their lives, they’ll prevent other people around them from doing something great. They think their job is to shoot holes in things. And it’s okay to shoot holes in things as long as you come up with a solution.

There’s also the classic military line, “Either lead, follow, or get out of the way.” And these people want a fourth option, where they don’t want to lead, they don’t want to follow, but they don’t want to get out of the way. They want to tell you why the thing is not going to work.

And all the really successful people I know have a very strong action bias. They just do things. The easiest way to figure out if something is viable or not is by doing it. At least do the first step, and the second step, and the third, and then decide.

So, if you want to be successful in life, creating wealth, or having good relationships, or being fit, or even being happy, you need to have an action bias towards getting what you want.

The cynics and the pessimists, what they’re really saying, it’s unfortunate, but they’re basically saying, "I’ve given up. I don’t think I can do anything. And so the world to me just looks like a world where nobody can do anything. And so why should you go do something because if you fail, then I’m right, which is great. But if you succeed, then you just make me look bad."

So, adapting for modern society means overriding your pessimism, and taking slightly irrationally optimistic bets because the upside is unlimited if you start the next SpaceX, or Tesla, or Uber, you can make billions of dollars of value for society, and for yourself, and change the world.

The thing is that we have this idea that everything can be taught, everything can be taught in school. And it’s not true that everything can be taught. In fact, the most interesting things cannot be taught. But everything can be learned.

If you become too goal-oriented on the money, then you won’t pick the right thing. You won’t actually pick the thing that you love to do, so you won’t go deep enough into it.

Build specific knowledge where you are a natural.

Read what you love until you love to read. The foundation of learning is reading. I don’t know a smart person who doesn’t read and read all the time. At some point there’s too much out there to read. Even reading is full of junk. So, it is important that you read foundational things. And foundational things, I would say, are the original books in a given field that are very scientific in their nature. For example, instead of reading a business book, pick up Adam Smith’s The Wealth of Nations. Instead of reading a book on biology or evolution that’s written today, I would pick up Darwin’s Origin of the Species. Instead of reading a book on biotech right now that may be very advanced, I would just pick up The Eighth Day of Creation by Watson and Crick. Instead of reading advanced books on what cosmology and what Neil Degrasse Tyson and Stephen Hawking have been saying, you can pick up Richard Feynman’s Six Easy Pieces and start with basic physics.

The means of learning are abundant, the desire to learn is scarce.

But one of the problems is that schools and our educational system, and even our way of raising children replaces curiosity with compliance. And once you replace the curiosity with the compliance, you get an obedient factory worker, but you no longer get a creative thinker. And you need creativity, you need the ability to feed your own brain to learn whatever you want.

It’s better to read a great book really slowly than to fly through a hundred books quickly.

It’s like Bruce Lee said, "I don’t fear the man who knows a thousand kicks and a thousand punches, I fear the man who’s practiced one punch ten thousand times or one kick ten thousand times."

What did you mean when you said that "doing is faster than watching?" A lot of people think they can become really skilled at something by watching others do it, or even by reading about others doing it. And going back to the business school case study, that’s a classic example. They study other people’s businesses, but in reality, you’re going to learn a lot more about running a business by operating your own lemonade stand or equivalent. Or even opening a little retail store down the street.

So, I’m putting in thousands of hours, but they are thousands of hours doing the same thing. Whereas if I was putting in thousands of iterations, that would be different. So, the learning curve is across iterations [not iterations]. So, the more iterations you can have, the more shots on goal you can have, the faster you’re going to learn. It’s not just about the hours put in.

Nassim Taleb made his wealth by being a trader who basically relied upon black swans. He made money by losing little bits of money every day and then once in a blue moon he would make a lot of money when the unthinkable happened for other people [The same as AI; watch AlphaGo]. Whereas most people want to make little bits of money every day and in exchange they’ll tolerate lots of blow-up risk, they’ll tolerate going completely bankrupt.

We’re evolved for small victories all the time but that becomes very expensive. That’s where the crowd is. That’s where the herd is. So, if you’re willing to bleed a little bit every day but in exchange you’ll win big later, you will do better.

"Embrace accountability and take business risks under your own name. Society will reward you with responsibility, equity, and leverage."

We’re still socially hard wired to not fail in public under our own names. The people who have the ability to fail in public under their own names actually gain a lot of power.

The employees get the most security, but in exchange for that security, they don’t have as much upside.

Realize that in modern society, the downside risk is not that large. Even personal bankruptcy can wipe the debts clean in good ecosystems.

Generally people will forgive failures as long as you were honest and made a high integrity effort.

Even if a business fails and your name’s on it, that’s not as bad as if it turns out to be an integrity issue.

Accountability is reputational skin in the game.

Wealth requires leverage. Labor and capital are older forms of leverage that everyone is fighting over.

The oldest form of leverage is labor, which is people working for you. Instead of me lifting rocks, I can have 10 people lift rocks. Society overvalues labor as a form of leverage. This is why your parents are impressed when you get a promotion and you have lots of people working underneath you. This is why when a lot of naive people, when you tell them about your company, they’ll say, "How many people work there?" They’ll use that as a way to establish credibility. They’re trying to measure how much leverage and impact you actually have. Or when someone starts a movement, they’ll say how many people they have or how big the army is. We just automatically assume that more people is better. You want the minimum amount of labor that allows you to use the other forms of leverage. I would argue that this is the worst form of leverage that you could possibly use. Managing other people is incredibly messy. It requires tremendous leadership skills.

Capital has been the dominant form of leverage in the last century. It can be converted to labor. It can be converted to other things. It scales very, very well. If you get good at managing capital, you can manage more and more capital much more easily than you can manage more and more people. But the hard part with capital is how do you obtain it? That’s why I talked about specific knowledge and accountability first. If you have specific knowledge in a domain and if you’re accountable and you have a good name in that domain, then people are going to give you capital as a form of leverage that you can use to then go get more capital.

Product and media are the leverage of new wealth. Create software and media that work for you while you sleep. Idea of products that have no marginal cost of replication. Now, you can multiply your efforts without having to involve other humans and without needing money from other humans. Today, thanks to the Internet, I can buy a cheap microphone, hook it up to a laptop or an iPad, and there you are all listening.

Combining all three forms of leverage is a magic combination Now, the beauty is when you combine all of these three. That’s where tech startups really excel, where you take just the minimum, but highest output labor that you can get, which are engineers, and designers, product developers. Then you add in capital. You use that for marketing, advertising, scaling. You add in lots of code and media and podcasts and content to get it all out there.

Coding is such a great superpower because now you can speak the language of the robot armies and you can tell them what to do.

If everybody in the world is wearing a Rolex, then people don’t want to wear Rolexes anymore because they no longer signal. It’s canceled out the effect.

If you care about ethics in wealth creation, it is better to create your wealth using code and media as leverage because then those products are equally available to everybody as opposed to trying to create your wealth through labor or capital.

Again, if you’re wealthy today, for large classes of things, you spend your money on signaling goods to show other people that you’re wealthy, then you try and convert them to status. As opposed to actually consuming the goods for their own sake.

You should try and get into a business where making Widget Number 12 is cheaper than making Widget Number 5, and making Widget Number 10,000 is a lot cheaper than the previous ones. This builds up an automatic barrier to entry against competition and getting commoditized. That’s an important one.

A network effect is when each additional user adds value to the existing user base. Your users themselves are creating some value for the existing users. Network effects: value grows as the square of the customers. Network effects create natural monopolies.

You should always be thinking about how your users, your customers, can add value to each other because that is the ultimate form of leverage. You’re at the beach in the Bahamas or you’re sleeping at night and your customers are adding value to each other.

In an age of infinite leverage, judgment becomes the most important skill.

Well, the first part of your career’s spent hustling to get leverage. Once you have the leverage, then you wanna slow down a bit, because your judgment really matters.

Demonstrated judgment, credibility around the judgment, is so critical. Warren Buffett wins here because he has massive credibility. He’s been highly accountable. He’s been right over and over in the public domain. He’s built a reputation for very high integrity, so you can trust him. A person like that, people will throw infinite leverage behind him because of his judgment. Nobody asks him how hard he works; nobody asks him when he wakes up or when he goes to sleep. They’re like, "Warren, just do your thing." Judgment, especially demonstrated judgment, with high accountability, clear track record, is critical.

Judgment is knowing the long-term consequences of your actions. Wisdom is just judgment on a personal domain. Wisdom applied to external problems I think is judgment.

Judgment is very hard to build up. This is where both intellect and experience come in play. There are many problems with the so-called intellectuals in the ivory tower, but one of the reasons why Nassim Taleb rails against them is because they have no skin in the game. They have no real-world experience, so they just apply purely intellect. Intellect without any experience is often worse than useless because you get the confidence that the intellect gives you, and you get some of the credibility, but because you had no skin in the game, and you had no real experience, and no real accountability, you’re just throwing darts.

If you are smart and you iterate fast, it’s not even you put 10,000 hours into something, but you take 10,000 tries at something. The people with the best judgment are among the least emotional.

And the reason why a lot of the top investors, a lot of the value investors, like if you read Jeremy Grantham, or you read Warren Buffet, or you read up on Michael Burry, these people sound like philosophers, or they are philosophers, or they’re reading a lot of history books or science books. Like what are they doing, shouldn’t they be reading investment books. No. Investment books are the worst place to learn about investment, because investment is a real-world activity that is highly multi-variate, all the advantages are always being competed away. It’s always on the cutting-edge. What you actually just need is very, very broad-based judgment and thinking. The best way to do that is to study everything, including a lot of philosophy. Philosophy also makes you more stoic, makes you less emotional, and so you make better decisions; you have better judgment.

You buy something from Amazon; they screwed it up, you have to return it. Is it worth your time to return it? Is it worth the mental hassle? Keep in mind that you have less work hours, you have less mentally high-output hours. Do you want to use them to run errands and solve little problems, or do you want to save them for the big stuff?

All the great scientists were terrible at managing their household life. None of them had a clean, organized room, or made all their social events on time, or sent their thank you cards.

You can’t penny pinch your way to wealth. [Don't think how to lose small, but how to win big.]

If you can outsource something or not do something for less than your hourly rate, outsource it or don’t do it. If you can hire someone to do it for less than your hourly rate, hire them. That even includes things like cooking.

Work as hard as you can. Even though what you work on and who you work with are more important.

If getting wealthy is your goal, you are going to have to work as hard as you can. But hard work is absolutely no substitute for who you work with and what you work on. What you work on is probably the most important thing.

The order of operations when you’re building a business, or even building your career, is first figure out, "What should I be doing? What is something where there is a market that is emerging? There’s a product that I can build that I’m excited to work on and something where I have specific knowledge and I’m really into it?"

Second, surround yourself with the best people possible. If there’s someone greater out there to work with, you should go work with them.

Now, this is where the mythology gets a little crazy. People who work 80, 120 hour weeks, a lot of that’s just status signaling. It’s showing off. Nobody really works 80 to 120 hours a week sustained at high output with mental clarity. Your brain breaks down. You just won’t have good ideas.

Really, the way people tend to work most effectively, especially in knowledge work, is they sprint as hard as they can while they’re working on something, and they’re inspired and they’re passionate; and then they rest. They take long breaks. It’s more like a lion hunting and much less a marathon runner running. You sprint, then you rest, you re-assess, and then you try again. What you end up doing is you end up building a marathon of sprints.

Inspiration is perishable. When you have your inspiration, do it right then and there.

"Impatience with actions and patience with results." Anything you have to do, just get it done. Why wait? You’re not getting any younger. Your life is slipping away. You don’t want to spend it doing thing that you know ultimately aren’t part of your mission.

If I have a problem that I discover in one of my businesses that needs to be solved, I basically won’t sleep until at least the resolution is in motion. This is just a personal failing, but if I’m on the board of a company, I’ll call the CEO. If I’m running the company, I’ll call my reports. If I am responsible, I’ll get on there, right then and there, and solve it. If I don’t solve a problem the moment it happens, or if I don’t start moving towards solving it when it happens, I have no peace. I have no rest. I have no happiness until that problem is solved; so solve it as quickly as possible. I literally won’t sleep until it’s solved. Maybe that’s just a personal characteristic, but it’s worked out well in business.

We squander our time with the death of 1,000 cuts.

People want to do coffee and build relationships, and that’s fine early in your career when you’re still exploring. But later in your career when you’re exploiting, and there are more things coming at you than you have time for, you have to ruthlessly cut meetings out of your life. If someone wants to do a meeting, see if you can do it with a phone call instead. If they want to do a phone call, see if they can do it with an email instead. If they want to do with email, see if they can do with a text message instead. If they’re text messaging, you should probably be ignoring most text messages unless they’re urgent, true emergencies. One has to be utterly ruthless about dodging meetings. When you do do meetings, do walking meetings, do standing meetings. Keep them short, keep them actionable, keep them small. Any meeting with eight people sitting around at a conference table, nothing is getting done in that meeting. You are literally just dying one hour at a time.

Steve Jobs, when they asked him, "Hey, why doesn’t Apple come to conventions?" Or "Why don’t you come to my convention?" His response was, "Well, then because we wouldn’t be here working."

I used to have a tough time turning people down for meetings, but now I just tell them outright. I just say, "Look, I don’t do non-transactional meetings. I don’t do meetings without a strict agenda. I don’t do meetings unless we absolutely have to."

People will meet with you when you have proof of work. When you have something important or something valuable, other busy, interesting people will meet with you. Your calling card has to be, "Hey, here’s what I’ve done. Here’s what I can show you. Let’s meet and I’ll be respectful of your time if this is useful to you."

If you have proof of work, and you truly have something interesting, then you shouldn’t hesitate to put it together in an email and send it to somebody. Even then, when you’re asking for a meeting, you wanna be super actionable about it.

Networking is overrated even early in your career.

A busy calendar and a busy mind will destroy your ability to do great things in this world. If you want to be able to do great things, whether you’re a musician, or whether you are an entrepreneur, or whether you’re an investor, you need free time and you need a free mind.

Competition can make you play the wrong game.

Competition will trap you in a lesser game. We’re highly memetic creatures, we copy what everybody else is doing around us. We copy our desires from them. You have to be a little careful when you get caught up in these status games, you end up competing over things that aren’t worth competing over.

So, authenticity naturally gets you away from competition. Does it mean that you necessarily want to be authentic to the point where there’s no product-market fit? You got to adjust that somehow until you find product-market fit. But at least lean towards authenticity, towards getting away from competition. And competition automatically leads towards copy-catting and often towards just playing completely the wrong game.

On a long enough time scale you do get paid but it can easily be 10 or 20 years. Sometimes it’s five and if it’s five or three and a friend of yours got there it can drive you insane. But, those are exceptions. And for every winner there’s multiple failures.

One thing that’s important in entrepreneurship is you just have to be right once. You get many, many shots on goal. You can take shot on goal every three to five years, maybe every 10 at the slowest or once every year at the fastest depending upon how you’re iterating with startups but you really only have to be right once.

Reject Most Advice. Most advice is people giving you their winning lottery ticket numbers. If you survey enough people all the advice will cancel to zero.

The best founders listen to everyone but make up their own mind.

Advice is maxims you can recall later, when you get your own experience.

The most dangerous part of taking advice is that the person that gave it to you is not going to be around to tell you when it doesn’t apply any longer.

If you can’t see yourself working with someone for life, then don’t work with them for a day.

When you’re finally wealthy, you’ll realize it wasn’t what you were seeking in the first place. Yes money will solve all your money problems but it doesn’t get you everywhere. The first thing you realize when you’ve made a bunch of money is that you’re still the same person. If you’re happy, you’re happy. If you’re unhappy, you’re unhappy. If you’re calm and fulfilled and peaceful you’re still that same person. I know lots of very rich people who are extremely out of shape. I know lots of rich people who have really bad family lives. I know lots of rich people who are internally a mess.

A calm mind, a fit body and a house full of love must be earned. Even if you have all the money in the world you can’t have those three things. Jeff Bezos still has to workout. He still has to work on his marriage or whatever his next relationship is. And his internal mental state is still going to be very much not controlled by external events. It’s going to be based on how calm and peaceful he is inside.

To me the ultimate purpose of money so you do not have to be in a specific place at a specific time doing anything you don’t want to do.

Get rich quick schemes are just someone else getting rich off you.

Which is why the only honest way, in my companies I’ve recruited entrepreneurs and I tell them, "You’re going to get to be entrepreneurial in this company and the day the you’re ready to go start your own next thing I’m going to support you. I’m never going to get in the way of you starting a company. But this can be a good place for you to learn how to build a good team and build a good culture, how to find product-market fit to perfect your skills and meet some amazing people while you figure out exactly what it is you’re going to do, because positioning, timing, deliberation, are very important when starting a company." But what I’ve never been able to do is look them in the face and say, "You must be at your desk by 8 AM." Because I’m not going to be at my desk by 8 AM, I want my freedom. Or say to them that you’re great at being a director today and you’ll be a VP tomorrow. Putting them into that cold career path track because I don’t believe in it myself.

Figure out what you’re uniquely good at and apply as much leverage as possible.

Find hobbies that make you rich, fit and creative.

The hardest thing for any founder is finding employees with a founder mentality. This is a fancy way of saying they care enough.

People will say, “Well, I’m not the founder. I’m not being paid enough to care.” Actually, you are: The knowledge and skills you gain by developing a founder mentality set you up to be a founder down the line; that’s your compensation.

Leverage is something that society gives you after you’ve demonstrated judgment. You can get it faster by learning high-leverage skills like coding or working with the media. These are permissionless leverage. This is why I encourage people to learn to code or produce media, even if it’s just nights and weekends.

Danny Hillis famously said technology is everything that doesn’t work yet. Technology is around us everywhere. The spoon was technology once; fire was technology once. When we figured out how to make them work, they disappeared in the background and became part of our everyday lives. Technology is, by definition, the intellectual frontier. It’s taking things from science and culture that we have not figured out how to mass produce or create efficiently and figuring out how to commercialize it and make it available to everybody.

Work in a way that your outputs are visible and measurable.

The entire structure of rewarding people comes from the agricultural and industrial ages, when inputs and outputs matched up closely. The amount of hours you put into doing something was a reliable proxy for what kind of output you’d get. Today, it’s extremely nonlinear. One good investment decision can make a company $10 million or $100 million. One good product feature can be the difference between product-market fit and complete failure. As a result, judgment and accountability matter much more. Often the best engineers aren’t the hardest workers. Sometimes they don’t work very hard at all, but they dependably ship that one critical product at just the right time. It’s similar to the salesperson who closes the huge deal that makes the company’s numbers for the quarter.

Once you get some specific knowledge, you can scale it by training your own apprentices and outsourcing tasks to them.

Specific knowledge comes on the job, not in a classroom.