I have been asked a lot about investing and startups lately. I think what most people are really asking me is how do I get Rich and get financial independence. I thought I will share what Naval Ravikanth shared in one of the Wisdom Tweets Storms. He has very clearly articulated what I believed to be true and started working on it in 2009 myself. I have been living this for over a decade now and if you follow what is written here, you will get rich but you need to be patient. Investing and wealth building is a long term thing, if someone tells you there is a short cut or an easy way to get rich then they are worse than the snake oil salesmen and you should avoid them like the plague or the COVID.
How to get Rich (without getting lucky)
1. Seek wealth, not money or status. Wealth is having assets that earn while you sleep. Money is how we transfer time and wealth. Status is your place in the social hierarchy.
2. Understand that ethical wealth creation is possible. If you secretly despise wealth, it will elude you.
3. Ignore people playing status games. They gain status by attacking people who are playing the wealth creation game.
4. You are not going to get rich renting out your time. You must own equity- a piece of the business -to gain your financial freedom
5. You will get rich by giving society what it wants but does not yet know how to get. At scale.
6. Pick an industry where you can play long term games with long term people.
7. The internet has massively broadened the possible space of careers. Most people haven’t figured this out yet.
8. Play iterated games. All the returns in life, whether in wealth, relationships, or knowledge, come from compound interest.
9. Pick business partners with high intelligence, energy and above all, integrity.
10. Don’t partner with cynics and pessimists. Their beliefs are self-fulfilling.
11. Learn to sell. Learn to build. If you can do both, you will be unstoppable.
12. Arm yourself with specific knowledge, accountability and leverage.
13. Specific knowledge is knowledge that you cannot be trained for. If society can train you, it can train someone else, and replace you.
14. Specific knowledge is gained by pursuing your genuine curiosity and passion rather than whatever is hot right now.
15. Building specific knowledge will feel like play to you but will look like work to others.
16. When specific knowledge is taught, its through apprenticeships, not schools.
17. Specific knowledge is often highly technical or creative. It cannot be outsourced or automated.
18. Embrace accountability, and take business risks under your own name. Society will reward you with responsibility, equity, and leverage.
19. Most accountable people have singular, public, and risky brands: Oprah, Obama, Kanye, Elon. (I changed the name of the President because accountability is very important and I wanted to share a President who really took accountability to the office. Only time will tell if all Presidents did that).
20. “Give me a lever long enough and a place to stand, and I will move the earth – Archimedes”
21. Fortunes require leverage. Business leverage comes from capital, people and products with no marginal cost of replication (code and media i.e. digital).
22. Capital means money. To raise money, apply your specific knowledge, with accountability, and show resulting good judgement.
23. Labor means people working for you. It’s the oldest and most fought over form of leverage. Labor leverage will impress your parents, but don’t waste your life chasing it.
24. Capital and Labor are permissioned leverage. Everyone is chasing capital, but someone has to give it to you. Everyone is trying to lead, but someone has to follow you.
25. Code and media are permissionless leverage. They’re the leverage behind the newly rich. You can create software and media that works for you while you sleep.
26. An army of robots is freely available – its just packed in data centers for heat and space efficiencies. Use it.
27. If you can’t code, write books and blogs, record videos and podcasts.
28. Leverage is a force multiplier for your judgement.
29. Judgement requires experience, but can be learnt faster by learning foundational skills.
30. There is no skill called “business”. Avoid business magazines and business classes.