Here is a list of ideas from Naval’s now-famous Tweetstorm, elaborated in this blog/podcast. I turned this into a checklist to avoid errors in judgment when evaluating business opportunities and how to spend my time.
- Seek Wealth, Not Money or Status — Wealth is assets that earn while you sleep
- Make Abundance for the World — Wealth isn’t about taking something from somebody else
- Free Markets Are Intrinsic to Humans — We use credits and debits to cooperate across genetic boundaries
- Making Money Isn’t About Luck —Become the kind of person who makes money
- Make Luck Your Destiny — Build your character in a way that luck becomes deterministic
- You Won’t Get Rich Renting Out Your Time — You can’t earn non-linearly when you’re renting out your time
- Live Below Your Means for Freedom — People busy upgrading their lifestyles just can’t fathom this freedom
- Give Society What It Doesn’t Know How to Get — Society will pay you for creating what it wants and delivering it at scale
- The Internet Has Massively Broadened Career Possibilities — The Internet allows you to scale any niche obsession
- Play Long-Term Games With Long-Term People — All returns in life come from compound interest in long-term games
- Pick Partners With Intelligence, Energy and Integrity — You can’t compromise on any of these three
- Partner With Rational Optimists — Don’t partner with cynics and pessimists; their beliefs are self-fulfilling
- Arm Yourself With Specific Knowledge — Specific knowledge can be found by pursuing your genuine curiosity
- Specific Knowledge Is Highly Creative or Technical — Specific knowledge is on the bleeding edge of technology, art and communication
- Learn to Sell, Learn to Build — If you can do both, you will be unstoppable
- Read What You Love Until You Love to Read — You should be able to pick up any book in the library and read it
- The Foundations Are Math and Logic — Mathematics and logic are the basis for understanding everything else
- There’s No Actual Skill Called ‘Business’ — Avoid business schools and magazines
- Embrace Accountability to Get Leverage — Take risks under your own name and society will reward you with leverage
- Take Accountability to Earn Equity — If you have high accountability, you’re less replaceable
- Labor and Capital Are Old Leverage — Everyone is fighting over labor and capital
- Product and Media Are New Leverage — Create software and media that work for you while you sleep
- Product Leverage is Egalitarian — The best products tend to be available to everyone
- Pick a Business Model with Leverage — An ideal business model has network effects, low marginal costs and scale economies
- Example: From Laborer to Entrepreneur — From low to high specific knowledge, accountability and leverage
- Judgment Is the Decisive Skill — In an age of nearly infinite leverage, judgment is the most important skill
- Set an Aspirational Hourly Rate — Outsource tasks that cost less than your hourly rate $5,000 an hour
- Work As Hard As You Can — Even though what you work on and who you work with are more important
- Be Too Busy to ‘Do Coffee’ — Ruthlessly decline meetings
- Keep Redefining What You Do — Become the best in the world at what you do
- Escape Competition Through Authenticity — Nobody can compete with you on being you
- Play Stupid Games, Win Stupid Prizes — Competition will blind you to greater games
- Eventually, You Will Get What You Deserve — On a long enough timescale, you will get paid
- Reject Most Advice — Most advice is people giving you their winning lottery ticket numbers
- A Calm Mind, a Fit Body, a House Full of Love — When you’re finally wealthy, you’ll realize it wasn’t what you were seeking in the first place
- There Are No Get Rich Quick Schemes — Get rich quick schemes are just someone else getting rich off you
- Productize Yourself — Figure out what you’re uniquely good at, and apply as much leverage as possible
- Accountability Means Letting People Criticize You — You have to stick your neck out and be willing to fail publicly
- We Should Eventually Be Working for Ourselves — But we will have to make sacrifices and take on more risk
- Being Ethical Is Long-Term Greedy — If you cut fair deals, you will get paid in the long run
- Envy Can Be Useful, or It Can Eat You Alive — Envy can give you a powerful boost, or it can eat you alive
- Principal-Agent Problem: Act Like an Owner — If you think and act like an owner, it’s only a matter of time until you become an owner
- Kelly Criterion: Avoid Ruin — Don’t ruin your reputation or get wiped to zero
- Schelling Point: Cooperating Without Communicating — People who can’t communicate can cooperate by anticipating the other person’s actions
- Turn Short-Term Games Into Long-Term Games — Improve your leverage by turning short-term relationships into long-term ones
- Compounding Relationships Make Life Easier — Life gets a lot easier when you know someone’s got your back
- Price Discrimination: Charge Some People More — You can charge people for extras based on their propensity to pay
- Consumer Surplus: Getting More Than You Paid For — People are willing to pay more than what companies charge
- Net Present Value: What Future Income Is Worth Today — See what future income is worth today by applying a discount to its future value
- Calculating the Hidden Costs of Products — Externalities let you account for the true cost of products by including hidden costs
- Bonus: Finding Time to Invest in Yourself — If you have to work a “normal job,” take on accountability to build your specific knowledge
Technology is, by definition, the intellectual frontier. It’s taking things from science and culture that we have not figured out how to mass-produce or create efficiently and figuring out how to commercialize it and make it available to everybody.
Another good indicator of specific knowledge is when someone can’t give a straight answer to the question: “What do you do every day?” Or you get an answer along the lines of, “Every day is different based on what’s going on.”