Wealth and Happiness are the two focus words of this manuscript.
Naval Ravikant is an Indian American entrepreneur and investor who is one of the most recognized CEO of Silicon Valley.
He his co-founder, chairman and former CEO of AngelList and has invested in hundreds of the most successful companies in the world (e.g., Uber, Twitter, and Stack Overflow).
However, this book has not been written by Naval himself, but by Eric Jorgenson, who collected all the most important quotes from transcripts, tweets and talks by Naval.
The whole manuscript is then an elaboration of those quotes as if Naval himself were talking.
As Eric write in his introduction, “All brilliance in this book is Naval’s; any mistakes are mine”.
In the next two sections I want to collect some of the main ideas of this manuscript and give you a glimpse of the wisdom you can find in the book.
I will make a large use of quotes from Naval himself, as it is done in the book, not to alter the content of the message and correctly report Naval’s own words.
Part 1 – Wealth
This first part is dedicated to wealth, what it is and how can you make it.
Making money is not a thing you do—it is a skill you learn.
The most important element that helps you building wealth is leverage. It is indeed the force multiplier for your judgement and the most effective element that will bring customers to you and not to your competitor.
Building leverage is therefore fundamental for those who want to build wealth, and the most important advice that Naval gives us is to study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers.
Among all the possible subjects those are the most important because they define the rules that rule today’s world.
Microeconomics helps you to understand how money moves and how engage with the customer.
Game Theory helps you to understand human and corporate interaction in scenarios that involves multiple agents.
Psychology will help you to better understand how people think and how to then deal with them in such a way that both will benefit from that interaction.
Persuasion is a key element in sales and industry.
Ethics is what you will need to leave the world better that how you found it.
Mathematics, especially the basics, are the key element to understand every aspect of the modern world and of industry.
Computers, obviously, are the most effective environment in which to build wealth today.
Specific knowledge cannot be taught, but it can be learned.
No one can compete with you on being you.
Most of life is a search for who and what needs you the most.
Naval suggest focussing on Specific Knowledge, which is something that cannot be taught. This is important because if something is teachable, anyone can learn it and can therefore replace it.
If you build your position on something that belong to you and you only, you will have way more leverage and safety in the entire business.
Build or buy equity in a business
If you do not own a piece of a business, you do not have a path towards financial freedom.
Being an employee is something that will never bring you to wealth and financial freedom (with few rare exceptions).
The amount of money you earn is linearly proportional to the amount of time you put into the job and is therefore limited.
Building your own business or being part of someone else’s is instead the way you can build wealth because the value is not linear to your time anymore and can multiply itself many times without requiring as much effort.
This is an exponential growth that owning a business (even if partially) can give you.
You are never going to get rich renting out your time.
Forty-hour work weeks are a relic of the Industrial Age. Knowledge workers function like athletes—train and sprint, then rest and reassess.
In such a context, his advice is indeed “earn with your mind, not your time”.
Our time is limited, and it is the scarcest resource we have. Our mind is way more powerful because can build and generate ideas and knowledge way faster.
Value your time at an hourly rate, and ruthlessly spend to save time at that rate. You will never be worth more than you think you are worth.
The business world is becoming a positive sum game, in which it is no longer true that the success of a company means the death of another.
Sometimes can happen, but nowadays we are in a world in which we can produce wealth and value even if our competitors do so at the same time.
This is possible thank to technology that allow us to replicate our product any number of times without requiring us to do the effort every time.
Ways to get lucky:
– Hope luck finds you
– Hustle until you stumble into it
– Prepare the mind and be sensitive to chances others miss
– Become the best at what you do. Refine what you do until this is true. Opportunity will seek you out. Luck becomes your destiny.
People are oddly consistent. Karma is just you, repeating your patterns, virtues, and flaws until you finally get what you deserve.
Always pay it forward. And do not keep count.
There is no shortcut to smart.
You do not get rich by spending your time to save money.
You get rich by saving your time to make money.
In an era of leverage, one correct decision can win everything. This is why judgment is so important.
It is the element that will guide you to make the best decision possible.
If you cannot decide, the answer is no!
When facing difficult questions like “should I take this job?” or “should I marry this person?”, if you cannot decide, the answer is no.
The reason is that modern society is full of options, and you should say yes only when you are pretty certain of this answer and its implications.
Simple heuristic: If you are evenly split on a difficult decision, take the path more painful in the short term.
What are the most efficient ways to build new mental models and make better decisions?
Read a lot—just read.
Love to read
Read what you love until you love to read.
It almost does not matter what you read. Eventually, you will read enough things (and your interests will lead you there) that it will dramatically improve your life.
The reason why it is fundamental to learn the basics of the topics we are interested in is that if you are memorizing advanced concepts without being able to re-derive them as needed, you are lost.
Part 2 – Happiness
The three big ones in life are wealth, health, and happiness. We pursue them in that order, but their importance is reverse.
Happiness is really a default state. Happiness is there when you remove the sense of something missing in your life.
We are highly judgmental survival-and-replication machines. We constantly walk around thinking, “I need this,” or “I need that,” trapped in the web of desires.
Happiness is the state when nothing is missing. When nothing is missing, your mind shuts down and stops running into the past or future to regret something or to plan something.
Happiness, love, and passion…are not things you find—they are choices you make.
Success does not earn happiness
Happiness is being satisfied with what you have.
Success comes from dissatisfaction. Choose.
Most people think of someone as successful when they win a game, whatever game they play themselves. If you are an athlete, you are going to think of a top athlete. If you are in business, you might think Elon Musk.
The real winners are the ones who step out of the game entirely, who do not even play the game, who rise above it. Those are the people who have such internal mental and self-control and self-awareness, they need nothing from anybody else.
Choosing to care for yourself
Nothing like a health problem to turn up the contrast dial for the rest of life.
My number one priority in life, above my happiness, above my family, above my work, is my own health.
It starts with my physical health.
Second, it is my mental health.
Third, it is my spiritual health.
Then, it is my family’s health.
Then, it is my family’s wellbeing.
After that, I can go out and do whatever I need to do with the rest of the world.
The search for happiness and wealth is a long journey of searching for ourselves.
It is not a matter of money and success, not only.
It is not about how much we have. It is about how what we are missing.
When we are missing nothing, we already have everything, and this is wealth. This is happiness.