Naval Ravikant

 

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Naval Ravikant

He is the CEO and co-founder of AngelList. He’s invested in more than 100 companies, including Uber, Twitter, Yammer, and many others.

Naval Podcast

Link: https://podcasts.apple.com/us/podcast/naval/id1454097755

Wealth Creation TL;DR:

  • Be successful in life by creating wealth, having good relationships, being fit and being happy - have an action bias towards getting what you want & be a rational optimistic about it.

  • Think big & the outcome will be big.

  • Ideally, you only work to express your creativity.

  • Be a maker, not just a taker.

  • You are not going to get rich by renting out your time - need to get paid at scale

  • You will be rewarded directly in proportion with your level of accountability in the business

  • Escape competition through authenticity. No-one can compete with you on being you.

  • All benefits in life come from compound interest. Wealth, relationship, health, good-will.

  • Self-esteem is a reputation that you have with yourself. Ego can be undeserving.

  • Foundation of learning is reading.

  • Authenticity helps you get away from competition. Know yourself, be yourself.

  • If you want to do great things - you need to have free time and a free mind. Busy calendar & schedule will destroy your creativity.

  • Be impatient with actions and patience with results.

True wealth creation notes:

Wealth

  • Businesses and assets that can earn while you sleep

  • Purpose of wealth is freedom - be your own sovereign individual

  • Not going to get it unless you really want it - and everyone wants it

Money game

  • Money - how we transfer wealth

  • Positive sum games

  • Create things together

Status game

  • Status - Ranking in social hierarchy

  • Zero sum game

  • Sports, politics

  • Play an important role in our society

  • Much better predictor of survival

4 kinds of luck

  • Blind luck

  • Hustler luck - things get stirred up in the dust

  • Good at spotting luck - skilled in field and notice a break

  • Rare luck

    • luck finds you

    • create your own luck

    • deterministic - stops being luck

    • unique way that you act & your character - your reputation

    • more or less destiny

    • be on the frontier & dig deeper than other people

You need to find a job or career where your inputs and outputs are highly disconnected (more creative careers) - looking for a job where your work doesn’t scale linearly.

Internet connects everyone to everyone. You can find your audience/customers, no matter how far they are.

Long term game, everybody is making each other rich.

Short term game, everybody is making themselves rich.

Pick people to work with that have:

  • High intelligence (smart)

  • High energy (proactive)

  • High integrity (look for signals - what they DO not what they SAY)

Be a rational optimist.

Either lead, follow or get out of the way.

Have a strong action bias.

Why not think big? One life on this planet.

Avoid risk of ruin - take rationally optimistic bets with big upsides

You hire when

  • It takes more man hours than you have available (engineering work)

  • You hire for skills you don't have on the team (domains specific)

Skills that you need

  • Specific knowledge - you getting paid as opposed to someone else

  • Accountability - why you?

  • Leverage - getting paid at scale

  • Judgement

Along with these, need to put in the time & hours - don’t keep track & don’t keep count - just enjoy it and keep doing it - get paid in a long enough timescale - 3/5/10/20 years

Productize Yourself

Making money - function of your identity & what you like to do

Specific knowledge

  • Look at what you have already built, and built on top of it.

  • You get paid for your specific knowledge

  • Pursuing innate talents & passion

  • Found by observation - what are you good at?

  • Technical & creative - tech, art, creation - can’t be automated - product knowledge

  • Follow your own obsession - keep an eye out for monetizing it

Learn to sell, learn to build - if you can do both, you’ll be unstoppable

Episode 15 - related to build tech/company & selling

2 founders - 1 at sales & 1 at building (CEO + CTO combo) - Catnip to investors

Selling scales better - hiring other people, online writing marketing etc

Builder can pick up selling - time + focus

Foundational books to read

  • Adam smith - wealth of nations

  • Darwin - origins of species

  • Watson & Crick - The Double Helix

  • Richard Feynman - 6 easy pieces to start with physics

  • Donal Knuth - algorithms

Built on a steel frame of a building

Principles & algorithms

Math & logic - scientific methods


Learning curve is across iterations (not repetition)

  • Need to try new things in every iteration

  • Gives you more shots on goal

  • Bruce Lee - practice 1 punch 1000 times

Entrepreneur - bleed everyday and win big later


Accountability

  • Small team with high level of accountability

  • Without it can’t have incentives

  • High accountability - less replaceable

  • Equity holder - greater risk but most of the upside

  • Reward is directly proportional to your accountability


Leverage

  • Labor - Oldest form of leverage

    • overvalued - how many people work there?

    • Ideally min # of people working with you

  • Capital - inventions of humans in last few thousand years

    • Trickier, more modern

    • Pretty common these days with bigger companies

    • Feels unfair - passed on through generations - accumulation

    • Scales well - but hard to obtain it

  • Product, Code & Media based - Products that have no marginal cost of replication

    • Started with printing press, broadcast media, internet & code

    • New fortunes, new generation - code or media

    • Amazing scale economies

Combine all 3 - Magic ✨- all tech startups - huge outsized returns

#3 leverage is permission-less leverage - #1 & #2 are becoming permission-less based on the internet

AI revolution is here - robots & computers - command them with code language


Business Model:

  • Scale economies - the more you produce something the cheaper it gets

  • Tech products has zero marginal costs of reproduction

  • Network effects

    • Metcalfe’s law - value of a network is proportional to square of the nodes in a network

    • Facebook, Uber, Youtube, Amazon, English Language, Money

    • Each additional user adds value to the existing users

    • Customers add value to each other


Judgement

  • Wisdom applied to external problems is judgement

  • Leverage is a force multiplier for your judgement

  • Once you have leverage - you want to slow down and use judgement instead

  • Everything you do is setting you up to apply your judgement

  • People with the best judgement are among the least emotional


Value your time

  • Set high personal hourly rate

  • $1,000/hour

  • Outsource something or don’t do it

Focus: Find product market fit, eat healthy & be fit

  • Product Market Founder Fit - how well are you suited to the business?

  • Who you work with? Work with the best people possible - build strong alumni network

  • How hard do you work? Work as hard as you can - sprints (not marathon)

Ignore text message unless they are true emergencies - if you really need to, call me!

Come with a proper calling card - build up credibility - not just slide deck - product progress - proof of work!