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This almanack has been designed entirely based on transcripts, talks, Tweets, etc… from Naval Ravikant. Naval is the CEO and a co-founder of AngelList and an angel investor that powered different succesful organizations such as Twitter, Uber and Yammer. A free version of the book is offered by the author itself on the official website.
Takeaway Points
Building Wealth
How to Get Rich (Without Getting Lucky):
- 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.
- Understand ethical wealth creation is possible. If you secretly despise wealth, it will elude you.
- Ignore people playing status games. They gain status by attacking people playing wealth creation games.
- You’re not going to get rich renting out your time. You must own equity—a piece of a business—to gain your financial freedom.
- You will get rich by giving society what it wants but does not yet know how to get. At scale.
- Pick an industry where you can play long-term games with long- term people.
- Play iterated games. All the returns in life, whether in wealth, relationships, or knowledge, come from compound interest.
- Pick business partners with high intelligence, energy, and, above all, integrity. Don’t partner with cynics and pessimists. Their beliefs are self- fulfilling.
- Learn to sell. Learn to build. If you can do both, you will be unstoppable.
- Arm yourself with specific knowledge, accountability, and leverage.
- Specific knowledge is knowledge you cannot be trained for. If society can train you, it can train someone else and replace you. Building specific knowledge will feel like play to you but will look like work to others. Specific knowledge is often highly technical or creative. It cannot be outsourced or automated.
- Embrace accountability, and take business risks under your own name. Society will reward you with responsibility, equity, and leverage.
- Fortunes require leverage. Business leverage comes from capital, people, and products with no marginal cost of replication (code and media).
- 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.
- 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. If you can’t code, write books and blogs, record videos and podcasts.
- Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers. Reading is faster than listening. Doing is faster than watching.
- 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.
- Become the best in the world at what you do. Keep redefining what you do until this is true.
Summary: Productize Yourself
Wealth vs Status games
“The business world has many people playing zero sum games and a few playing positive sum games searching for each other in the crowd.”
There are 2 huge games in life: one is the money game (which is not able to solve all your problems, but it can solve all your money problems) and status games. Status represents your ranking in the social hierarchy and some people can try to look high status by attacking the system and characterising money as evil if not able/willing to produce any. The problem with status games is that people try to put themself up by putting other people down (there must be a loser and no way for both parties to win).
“Wealth creation is an evolutionarily recent positive-sum game. Status is an old zero-sum game. Those attacking wealth creation are often just seeking status.”
“Play stupid games, win stupid prizes.”
Retirement
Retirement is when you stop sacrificing today for an imaginary tomorrow. There are 3 ways to reach this goal:
- Save enough money that your passive income (without you lifting a finger) covers your burn rate.
- Drive your burn rate down to zero—you become a monk.
- Doing something you love. You enjoy it so much, it’s not about the money.
“The winners of any game are the people who are so addicted they continue playing even as the marginal utility from winning declines.”
Luck
There are 4 kind of luck:
- Blind luck where one just gets lucky because something completely out of their control happened.
- Luck through persistence, hard work, hustle, and motion. This is when you’re running around creating opportunities. You’re just generating enough force, hustle, and energy for luck to find you.
- Spotting luck (being able to recognise opportunities in your area of expertise once they arise)
- You have built a unique character, a unique brand, a unique mindset, which causes luck to find you (you are recognised as the best at something and once an opportunity appears people automatically come to you).
“In a long-term game, it seems that everybody is making each other rich. And in a short-term game, it seems like everybody is making themselves rich.”
Principal-Agent Problem
Julius Caesar famously said, “If you want it done, then go. And if not, then send.” What he meant was, if you want it done right, then you have to go yourself and do it. When you are the principal, then you are the owner—you care, and you will do a great job. When you are the agent and you are doing it on somebody else’s behalf, you can do a bad job. You just don’t care. You optimize for yourself rather than for the principal’s assets.
The smaller the company, the more everyone feels like a principal. The less you feel like an agent, the better the job you’re going to do. The more closely you can tie someone’s compensation to the exact value they’re creating, the more you turn them into a principal, and the less you turn them into an agent.
Happiness
“Maybe happiness is not something you inherit or even choose, but a highly personal skill that can be learned, like fitness or nutrition. Today, I believe happiness is really a default state. Happiness is there when you remove the sense of something missing in your life.”
“People mistakenly believe happiness is just about positive thoughts and positive actions. The more I’ve read, the more I’ve learned, and the more I’ve experienced, every positive thought essentially holds within it a negative thought. If I say I’m happy, that means I was sad at some point. Every positive thought even has a seed of a negative thought within it and vice versa, which is why a lot of greatness in life comes out of suffering. You have to view the negative before you can aspire to and appreciate the positive.”
“If you ever want to have peace in your life, you have to move beyond good and evil.”
“I’ve also come to believe in the complete and utter insignificance of the self, and I think that helps a lot. For example, if you thought you were the most important thing in the Universe, then you would have to bend the entire Universe to your will. If you’re the most important thing in the Universe, then how could it not conform to your desires. If it doesn’t conform to your desires, something is wrong. However, if you view yourself as a bacteria or an amoeba—or if you view all of your works as writing on water or building castles in the sand, then you have no expectation for how life should “actually” be. Life is just the way it is. When you accept that, you have no cause to be happy or unhappy. Those things almost don’t apply. What you’re left with in that neutral state is not neutrality. I think people believe neutrality would be a very bland existence. No, this is the existence little children live. If you look at little children, on balance, they’re generally pretty happy because they are really immersed in the environment and the moment, without any thought of how it should be given their personal preferences and desires.”
“We think of ourselves as fixed and the world as malleable, but it’s really we who are malleable and the world is largely fixed. Real happiness only comes as a side-effect of peace. Most of it is going to come from acceptance, not from changing your external environment. A rational person can find peace by cultivating indifference to things outside of their control.”
“We crave experiences that will make us be present, but the cravings themselves take us from the present moment.”
“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.”
“Desire is a contract you make with yourself to be unhappy until you get what you want.”
“Happiness is being satisfied with what you have. Success comes from dissatisfaction. Choose.”
“When working, surround yourself with people more successful than you. When playing, surround yourself with people happier than you.”
“Hedonic adaptation is more powerful for man-made things (cars, houses, clothes, money) than for natural things (food, sex, exercise).”
Quotes
“Give me a lever long enough and a place to stand, and I will move the earth.” —Archimedes
“Technology democratizes consumption but consolidates production. The best person in the world at anything gets to do it for everyone.”
“Intentions don’t matter. Actions do. That’s why being ethical is hard.”
“If it entertains you now but will bore you someday, it’s a distraction. Keep looking.”
“Forget rich versus poor, white-collar versus blue. It’s now leveraged versus un-leveraged.”
“There are almost 7 billion people on this planet. Someday, I hope, there will be almost 7 billion companies.”
“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.”
“Sharks eat well but live a life surrounded by sharks.”
“Your real résumé is just a catalog of all your suffering. If I ask you to describe your real life to yourself, and you look back from your deathbed at the interesting things you’ve done, it’s all going to be around the sacrifices you made, the hard things you did.”
“Most of the time, the person you have to become to make money is a high-anxiety, high-stress, hard-working, competitive person. When you have done that for twenty, thirty, forty, fifty years, and you suddenly make money, you can’t turn it off. You’ve trained yourself to be a high-anxiety person. Then, you have to learn how to be happy.”
“What we wish to be true clouds our perception of what is true. Suffering is the moment when we can no longer deny reality.”
“There are two attractive lessons about suffering in the long term. It can make you accept the world the way it is. The other lesson is it can make your ego change in an extremely hard way.”
“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.”
I never ask if “I like it” or “I don’t like it.” I think “this is what it is” or “this is what it isn’t.” —Richard Feynman
Warren Buffett praise specifically, criticize generally: If you have a criticism of someone, then don’t criticize the person— criticize the general approach or criticize the class of activities. If you have to praise somebody, then always try and find the person who is the best example of what you’re praising and praise the person, specifically. Then people’s egos and identities, which we all have, don’t work against you. They work for you.
“Read what you love until you love to read.”
“Pointing out obvious exceptions implies either the target isn’t smart or you aren’t.”
“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.”
“If they wrote it to make money, don’t read it.”
“Read the greats in math, science, and philosophy. Ignore your contemporaries and news. Avoid tribal identification. Put truth above social approval.”
“I have people in my life I consider to be very well-read who aren’t very smart. The reason is because even though they’re very well- read, they read the wrong things in the wrong order. They started out reading a set of false or just weakly true things, and those formed the axioms of the foundation for their worldview. Then, when new things come, they judge the new idea based on a foundation they already built. Your foundation is critical.”
“To think clearly, understand the basics. If you’re memorizing advanced concepts without being able to re-derive them as needed, you’re lost.”
“When solving problems: the older the problem, the older the solution.”
“You know that song you can’t get out of your head? All thoughts work that way. Careful what you read.”
“A calm mind, a fit body, and a house full of love. These things cannot be bought. They must be earned.”
“To make an original contribution, you have to be irrationally obsessed with something.”
“When everyone is sick, we no longer consider it a disease.”
“Easy choices, hard life. Hard choices, easy life.”
“Most of our suffering comes from avoidance.”
“Impatience with actions, patience with results.”
“Everything is more beautiful because we’re doomed. You will never be lovelier than you are now, and we will never be here again.” —Homer, The Iliad
Book Authors: Eric Jorgenson
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