My only real friends were books. Books make for great friends, because the best thinkers of the last few thousand years tell you their nuggets of wisdom. [8]
Making money is not a thing you do—it’s a skill you learn.
Getting rich is about knowing what to do, who to do it with, and when to do it.
Play iterated games. All the returns in life, whether in wealth, relationships, or knowledge, come from compound interest.
There is no skill called “business.” Avoid business magazines and business classes.
Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers.
Set and enforce an aspirational personal hourly rate. If fixing a problem will save less than your hourly rate, ignore it. If outsourcing a task will cost less than your hourly rate, outsource it.
Work as hard as you can. Even though who you work with and what you work on are more important than how hard you work.
There are no get-rich-quick schemes. Those are just someone else getting rich off you.
Almost everything in your house, in your workplace, and on the street used to be technology at one point in time. There was a time when oil was a technology that made J.D. Rockefeller rich. There was a time when cars were technology that made Henry Ford rich.
So, technology is the set of things, as Alan Kay said, that don’t quite work yet [correction: Danny Hillis]. Once something works, it’s no longer technology. Society always wants new things. 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 and providing it is natural to you, within your skill set, and within your capabilities.
Specific knowledge cannot be taught, but it can be learned.
For example, I love to read, and I love technology. I learn very quickly, and I get bored fast. If I had gone into a profession where I was required to tunnel down for twenty years into the same topic, it wouldn’t have worked. I’m in venture investing, which requires me to come up to speed very, very quickly on new technologies (and I’m rewarded for getting bored because new technologies come along). It matches up pretty well with my specific knowledge and skill sets. [10]
I have some sales skills, which is a form of specific knowledge. I have some analytical skills on how to make money. And I have this ability to absorb data, obsess about it, and break it down—that is a specific skill that I have. I also love tinkering with technology. And all of this stuff feels like play to me, but it looks like work to others.
You can go on the internet, and you can find your audience. And you can build a business, and create a product, and build wealth, and make people happy just uniquely expressing yourself through the internet. [78] The internet enables any niche interest, as long as you’re the best person at it to scale out. And the great news is because every human is different, everyone is the best at something—being themselves.
The most important skill for getting rich is becoming
The most important skill for getting rich is becoming a perpetual learner. You have to know how to learn anything you want to learn. The old model of making money is going to school for four years, getting your degree, and working as a professional for thirty years.
It’s much more important today to be able to become an expert in a brand-new field in nine to twelve months than to have studied the “right” thing a long time ago.
Basic arithmetic and numeracy are way more important in life than doing calculus. Similarly, being able to convey yourself simply using ordinary English words is far more important than being able to write poetry, having an extensive vocabulary, or speaking seven different foreign languages. Knowing how to be persuasive when speaking is far more important than being an expert digital marketer or click optimizer.
Compound interest is a very powerful concept. Compound interest applies to more than just compounding capital.
Intentions don’t matter. Actions do. That’s why being ethical is hard.
So to get these things, you have to build credibility, and you have to do it under your own name as much as possible, which is risky. So, accountability is a double-edged thing. It allows you to take credit when things go well and to bear the brunt of the failure when things go badly. [78]
Knowledge only you know or only a small set of people knows is going to come out of your passions and your hobbies, oddly enough. If you have hobbies around your intellectual curiosity, you’re more likely to develop these passions. [1] If it entertains you now but will bore you someday, it’s a distraction.
The less you want something, the less you’re thinking about it, the less you’re obsessing over it, the more you’re going to do it in a natural way.
You’re more likely to have skills society does not yet know how to train other people to do. If someone can train other people how to do something, then they can replace you.
Whenever you can in life, optimize for independence rather than pay. If you have independence and you’re accountable on your output, as opposed to your input—that’s the dream. [10]
For example, a good software engineer, just by writing the right little piece of code and creating the right little application, can literally create half a billion dollars’ worth of value for a company. But ten engineers working ten times as hard, just because they choose the wrong model, the wrong product, wrote it the wrong way, or put in the wrong viral loop, have basically wasted their time. Inputs don’t match outputs, especially for leveraged workers.
What you want in life is to be in control of your time. You want to get into a leveraged job where you control your own time and you’re tracked on the outputs. If you do something incredible to move the needle on the business, they have to pay you. Especially if they don’t know how you did it because it’s innate to your obsession or your skill or your innate abilities, they’re going to have to keep paying you to do it.
If you have specific knowledge, you have accountability and you have leverage; they have to pay you what you’re worth. If they pay you what you’re worth, then you can get your time back—you can be hyper-efficient.
You’re not doing meetings for meetings’ sake, you’re not trying to impress other people, you’re not writing things down to make it look like you did work. All you care about is the actual work itself.
The higher the creativity component of a profession, the more likely it is
The higher the creativity component of a profession, the more likely it is to have disconnected inputs and outputs.
These are two very broad categories. One is building the product. This is hard, and it’s multivariate. It can include design; it can include development; it can include manufacturing, logistics, procurement; and it can even be designing and operating a service. It has many, many definitions.
The other side of it is sales. Again, selling has a very broad definition. Selling doesn’t necessarily just mean selling to individual customers, but it can mean marketing, it can mean communicating, it can mean recruiting, it can mean raising money, it can mean inspiring people, it could mean doing PR.
You start as a salaried employee. But you want to work your way up to try and get higher leverage, more accountability, and specific knowledge. The combination of those over a long period of time with the magic of compound interest will make you wealthy. [74] The
You start as a salaried employee. But you want to work your way up to try and get higher leverage, more accountability, and specific knowledge. The combination of those over a long period of time with the magic of compound interest will make you wealthy. [74]
Avoiding ruin means stay out of jail. So, don’t do anything illegal. It’s never worth it to wear an orange jumpsuit. Stay out of total catastrophic loss. Avoiding ruin could also mean you stay out of things that could be physically dangerous or
Avoiding ruin means stay out of jail. So, don’t do anything illegal. It’s never worth it to wear an orange jumpsuit. Stay out of total catastrophic loss. Avoiding ruin could also mean you stay out of things that could be physically dangerous or hurt your body. You have to watch your health.
Stay out of things that could cause you to lose all of your capital, all of your savings. Don’t gamble everything on one go.
We have as much leverage as is possible in our business, whether it’s through robots or computers or what have you. Then, we can be masters of our own time because we are just being tracked on outputs and not inputs.
I haven’t made money in my life in one giant payout. It has always been a whole bunch of small things piling up. It’s more about consistently creating wealth by creating businesses, creating opportunities, and creating investments.
I’m not the hardest working person—I’m actually a lazy person. I work through bursts of energy where I’m really motivated with something.
Spend more time making the big decisions. There are basically three really big decisions you make in your early life: where you live, who you’re with, and what you do.
You have to say no to everything and free up your time so you can solve the important problems. Those three are probably the three biggest ones. [1]
An old boss once warned: “You’ll never be rich since you’re obviously smart, and someone will always offer you a job that’s just good enough.”
Humans evolved as hunters and gatherers where we all worked for ourselves. It’s only at the beginning of agriculture we became more hierarchical. The Industrial Revolution and factories made us extremely hierarchical because one individual couldn’t necessarily own or build a factory, but now, thanks to the internet, we’re going back to an age where more and more people can work for themselves.
I learned how to make money because it was a necessity. After it stopped being a necessity, I stopped caring about it. At least for me, work was a means to an end. Making money was a means to an end. I’m much more interested in solving problems than I am in making money. Any end goal will just lead to another goal,
I learned how to make money because it was a necessity. After it stopped being a necessity, I stopped caring about it. At least for me, work was a means to an end. Making money was a means to an end. I’m much more interested in solving problems than I am in making money.
Art is creativity. Art is anything done for its own sake. What are the things that are done for their own sake, and there’s nothing behind them? Loving somebody, creating something, playing.
Lusting for money is bad for us because it is a bottomless pit. It will always occupy your mind. If you love money, and you make it, there’s never enough. There is never enough because the desire is turned on and doesn’t turn off at some number. It’s a fallacy to think it turns off at some number.
You make money to solve your money and material problems. I think the best way to stay away from this constant love of money is to not upgrade your lifestyle as you make money. It’s very easy to keep upgrading your lifestyle as you make money.
The winners of any game are the people who are so addicted they continue playing even as the marginal utility from winning declines.
Them coming to you to extract it and give you half is not blind luck. You created your own luck. You put yourself in a position to capitalize on luck or to attract luck when nobody else created the opportunity for themselves. To get rich without getting lucky, we want to be deterministic. We don’t want to leave it to chance. [78]
Become the best at what you do. Refine what you do until this is true. Opportunity will seek you out.
Become the best at what you do. Refine what you do until this is true. Opportunity will seek you out. Luck becomes your destiny.
If you are a trusted, reliable, high-integrity, long-term-thinking dealmaker, when other people want to do deals but don’t know how to do them in a trustworthy manner with strangers, they will literally approach you and give you a cut of the deal just because of the integrity and reputation you’ve built up.
Your character and your reputation are things you can build, which will let you take advantage of opportunities other people may characterize as lucky, but you know it wasn’t luck. [78]
If someone is talking a lot about how honest they are, they’re probably dishonest. That is just a little telltale indicator I’ve learned. When someone spends too much time talking about their own values or they’re talking themselves up, they’re covering for something. [4]
Karma is just you, repeating your patterns, virtues, and flaws until you finally get what you deserve.
What making money will do is solve your money problems. It will remove a set of things that could get in the way of being happy, but it is not going to make you happy.
You don’t get rich by spending your time to save money. You get rich by saving your time to make money.
If you can’t rederive concepts from the basics as you need them, you’re lost. You’re just memorizing. [4]
The hard thing is seeing the truth. To see the truth, you have to get your ego out of the way because your ego doesn’t want to face the truth.
To be honest, speak without identity.
Theoretical physicist Richard Feynman famously said, “You should never, ever fool anybody, and you are the easiest person to fool.” The moment you tell somebody something dishonest, you’ve lied to yourself. Then you’ll start believing your own lie, which will disconnect you from reality and take you down the wrong road.
praise specifically, criticize generally.
A lousy way to do memory prediction is “X happened in the past, therefore X will happen in the future.” It’s too based on specific circumstances. What you want is principles. You want mental models.
Microeconomics and game theory are fundamental. I don’t think you can be successful in business or even navigate most of our modern capitalist society without an extremely good understanding of supply-and-demand, labor-versus-capital, game theory, and those kinds of things. [4]
To me, the principal-agent problem is the single most fundamental problem in microeconomics. If you do not understand the principal-agent problem, you will not know how to navigate your way through the world. It is important if you want to build a successful company or be successful in your dealings.
You don’t need to learn geometry, trigonometry, calculus, or any of the complicated stuff if you’re just going into business. But you want arithmetic, probability, and statistics. Those are extremely important. Crack open a basic math book, and make sure you are really good at multiplying, dividing, compounding, probability, and statistics.
If you cannot decide, the answer is no. And the reason is, modern society is full of options. There are tons and tons of options.
You’re never going to be absolutely certain, but you’re going to be very certain.
Simple heuristic: If you’re evenly split on a difficult decision, take the path more painful in the short term.
What’s actually going on is one of these paths requires short-term pain. And the other path leads to pain further out in the future.
So you generally want to lean into things with short-term pain, but long-term gain.
The means of learning are abundant—it’s the desire to learn that is scarce. [3]
Read what you love until you love to read.
The number of books completed is a vanity metric. As you know more, you leave more books unfinished. Focus on new concepts with predictive power.
It’s not about “educated” vs. “uneducated.” It’s about “likes to read” and “doesn’t like to read.”
Because most people are intimidated by math and can’t independently critique it, they overvalue opinions backed with math/pseudoscience.
It’s better to be really great at arithmetic and geometry than to be deep into advanced mathematics. I would read microeconomics all day long—Microeconomics 101.
Another way to do this is to read originals and read classics. If you’re interested in evolution, read Charles Darwin. Don’t begin with Richard Dawkins (even though I think he’s great). Read him later; read Darwin
Another way to do this is to read originals and read classics. If you’re interested in evolution, read Charles Darwin. Don’t begin with Richard Dawkins (even though I think he’s great). Read him later; read Darwin first.
If you want to learn macroeconomics, first read Adam Smith, read von Mises, or read Hayek. Start with the original philosophers of the economy. If you’re into communist or socialist ideas (which I’m personally not), start by reading Karl Marx. Don’t read the current interpretation someone is feeding you about how things should be done and run.
If you start with the originals as your foundations, then you have enough of a worldview and understanding that you won’t fear any book. Then you can just learn. If you’re a perpetual learning machine, you will never be out of options for how to make money. You can always see what’s coming up in society, what the value is, where the demand is, and you can learn to come up to speed. [74]
you ever want to have peace in your life,
If you ever want to have peace in your life, you have to move beyond good and evil.
Happiness is what’s there when you remove the sense that something is missing in your life.
A lot of our unhappiness comes from comparing things from the past to the present. [4]
A happy person isn’t someone who’s happy all the time. It’s someone who effortlessly interprets events in such a way that they don’t lose their innate peace.
You can build good habits. Not drinking alcohol will keep your mood more stable. Not eating sugar will keep your mood more stable. Not going on Facebook, Snapchat, or Twitter will keep your mood more stable.
Essentially, you have to go through your life replacing your thoughtless bad habits with good ones, making a commitment to be a happier person. At the end of the day, you are a combination of your habits and the people who you spend the most time with.
Even if you can’t come up with something positive, you can say, “Well, the Universe is going to teach me something now. Now I get to listen and learn.”
You’re going to die one day, and none of this is going to matter. So enjoy yourself. Do something positive. Project some love. Make someone happy. Laugh a little bit. Appreciate the moment. And do your work. [8]
All you should do is what you want to do. If you stop trying to figure out how to do things the way other people want you to do them, you get to listen to the little voice inside your head that wants to do things a
All you should do is what you want to do. If you stop trying to figure out how to do things the way other people want you to do them, you get to listen to the little voice inside your head that wants to do things a certain way. Then, you get to be you.
Your goal in life is to find the people, business, project, or art that needs you the most. There is something out there just for you. What you don’t want to do is build checklists and decision frameworks built on what other people are doing. You’re never going to be them. You’ll never be good at being somebody else. [4]
really difficult topic to talk about. I will just say in general, any sensible diet avoids the combination of sugar and fat together. [2]
say in general, any sensible diet avoids the combination of sugar and fat together. [2]
in general, any sensible diet avoids the combination of sugar and fat together. [2]
“‘I say I want to do this, but I don’t really because if I really wanted to do it, I would just do it.”
Adam Smith.
You should know statistics and probability forwards and backwards and inside out. [8]
Value your time. It is all you have. It’s more important than your money. It’s more important than your friends. It is more important than anything. Your time is all you have. Do not waste your time.
doesn’t mean you can’t relax. As long as you’re doing what you want, it’s not a waste of your time.
This doesn’t mean you can’t relax. As long as you’re doing what you want, it’s not a waste of your time.
What is anger? Anger is a way to signal as strongly as you can to the other party you’re capable of violence. Anger is a precursor to violence.
What is anger? Anger is a way to signal as strongly as you can to the other party you’re capable of violence. Anger is a precursor to violence. Observe when you’re angry—anger is a loss of control over the situation. Anger is a contract you make with yourself to be in physical and mental and emotional turmoil until reality changes. [1]
People who live far below their means enjoy a freedom that people busy upgrading their lifestyles can’t fathom. [11]
Puberty is the onset of desire—the first time you really, really want something and you start long-range planning. You start thinking a lot, building an identity and an ego to get what you want.
Before you can lie to another, you must first lie to yourself.