Wealth

Labor and capital are much less egalitarian, not just in the inputs, but in their outputs. Let’s say that I need something that humans have to provide like if I want a massage or if I need someone to cook my food. The more of a human element there is in providing that service, the less egalitarian it is. More

The most interesting and the most important form of leverage is this idea of products that have no marginal cost of replication. This is the new form of leverage. This was only invented in the last few hundred years. It got started with the printing press. It accelerated with broadcast media, and now it’s really blown up with the Internet and with coding. More

Why don’t we talk a little bit about leverage? The first tweet in the storm was a famous quote from Archimedes, which was, “Give me a lever long enough and a place to stand and I will move the Earth.” The next tweet was, “Fortunes require leverage. Business leverage comes from capital, people and products with no marginal costs of replication.” More

Accountability is important because that’s how you’re going to get leverage. That’s how you’re going to get credibility. It’s also how you’re going to get equity. You’re going to get a piece of the business. When you’re negotiating with other people, ultimately if someone else is making a decision about how to compensate you, that decision will be based on how replaceable you are. More

Why don’t we jump into accountability, which I thought was pretty interesting and I think you have your own unique take on it. So the first tweet on accountability was, “Embrace accountability and take business risks under your own name. Society will reward you with responsibility, equity, and leverage.”  Yeah. So to get rich, you’re going to need leverage. More

In that sense, business to me is bottom of the barrel. There’s no actual skill called business, it’s too generic. It’s like a skill called “relating.” Like “relating to humans.” That’s not a skill, it’s too broad. A lot of what goes on in business schools, and there is some very intelligent stuff taught in business schools – I don’t mean to detract from them completely – some of the things taught in business school are just anecdotes. More

Foundational things are principles, they’re algorithms, they’re deep seated logical understanding where you can defend it or attack it from any angle. And that’s why microeconomics is important because macroeconomics is a lot of memorization, a lot of macro bullshit. As Nassim Taleb says, it is easier to macro bullshit than it is the micro bullshit. More

Before we go and talk about accountability and leverage and judgment, you’ve got a few tweets further down the line that I would put in the category of continuous learning. They’re essentially, “there is no skill called business. Avoid business magazines and business class, study microeconomics, game theory, psychology, persuasion, ethics, mathematics and computers.” More

Talking about combining skills, you said that you should “learn to sell, learn to build, if you can do both, you will be unstoppable.” This is a very broad category. It’s two broad categories. One is building the product. Which is hard, and it’s multivariate. It can include design, it can include development, it can include manufacturing, logistics, procurement, it can even be designing and operating a service. More

To the extent that specific knowledge is taught, it’s on the job. It’s through apprenticeships. And that’s why the best businesses, the best careers are the apprenticeship or self-taught careers, because those are things society still has not figured out how to train and automate yet. The classic line here is that Warren Buffett went to Benjamin Graham when he got out of school. More