Wealth

Work As Hard As You Can

Even though what you work on and who you work with are more important
Let’s talk about hard work. There’s a battle that happens on Twitter a lot. Should you work hard or should you not? David Heinemeier Hansson says, “It’s like you’re slave-driving people.” Keith Rabois says, “No, all the great founders worked their fingers to the bone.” They’re talking past each other. More

Set an Aspirational Hourly Rate

Outsource tasks that cost less than your hourly rate
We covered the skills you need to get rich. They included specific knowledge, accountability, leverage, judgment and life-long learning. Let’s talk about the importance of working hard and valuing your time. No one is going to value you more than you value you. Set a high personal hourly rate, and stick to it. More

Judgment Is the Decisive Skill

In an age of nearly infinite leverage, judgment is the most important skill
 We spoke about specific knowledge, we talked about accountability, we talked about leverage. The last skill that Naval talks about in his tweetstorm is judgment, where he says, that “Leverage is a force multiplier for your judgment.” We are now living in an age of nearly infinite leverage, and all the great fortunes are created through leverage. More

Example: From Laborer to Entrepreneur

From low to high specific knowledge, accountability and leverage
The tweetstorm is very abstract. It’s deliberately meant to be broadly applicable to all kinds of different domains and disciplines and time periods and places. But sometimes it’s hard to work without a concrete example. So let’s go concrete for a minute. Look at the real estate business. You could start at the bottom, let’s say you’re a day laborer. More

Pick a Business Model With Leverage

An ideal business model has network effects, low marginal costs and scale economies
One more question about leverage. Do you think a choice of business model or a choice of product can also bring a kind of leverage to it? For example, pursuing a business that has network effects. Pursuing a business that has brand effects. Or other choices of business model that people could manipulate that just give you free leverage. More

Product Leverage is Egalitarian

The best products tend to be available to everyone
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

Product and Media are New Leverage

Create software and media that work for you while you sleep
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