The Almanack of Naval by Naval Ravikant and Eric Jorgenson

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Key Takeaways

  1. I only really want to do things for their own sake. That is one definition of art. Whether it’s business, exercise, romance, friendship, whatever, I think the meaning of life is to do things for their own sake. Ironically, when you do things for their own sake, you create your best work. Even if you’re just trying to make money, you will actually be the most successful. The year I generated the most wealth for myself was actually the year I worked the least hard and cared the least about the future. I was mostly doing things for the sheer fun of it. I was basically telling people, “I’m retired, I’m not working.” Then, I had the time for whatever was my highest valued project in front of me. By doing things for their own sake, I did them at their best. The less you want something, the less you’re thinking about it, the less you’re obsessing over it, the more you’re going to do it in a natural way. The more you’re going to do it for yourself. You’re going to do it in a way you’re good at, and you’re going to stick with it. The people around you will see the quality of your work is higher.
    1. Effortless Mastery
  2. The final form of leverage is brand new—the most democratic form. It is: “products with no marginal cost of replication.” This includes books, media, movies, and code. Code is probably the most powerful form of permissionless leverage. All you need is a computer—you don’t need anyone’s permission. Forget rich versus poor, white-collar versus blue. It’s now leveraged versus un-leveraged. The most interesting and the most important form of leverage is the idea of products that have no marginal cost of replication. This is the new form of of leverage. This was only invented in the last few hundred years. It started with the printing press. It accelerated with broadcast media, and now it’s really blown up with the internet and with coding. Now, you can multiply your efforts without involving other humans and without needing money from other humans.
    1. Leverage
  3. Learn to sell, learn to build. If you can do both, you will be unstoppable.
    1. Alloying
  4. However, anything you’re given doesn’t matter. You have your four limbs, your brain, your head, your skin—that’s all for granted. You have to do hard things anyway to create your own meaning in life. Making money is a fine thing to choose. Go struggle. It is hard. I’m not going to say it’s easy. It’s really hard, but the tools are all available. It’s all out there. 
  5. I believe the solution to making everybody happy is to give them what they want. Let’s get them all rich.
  6. You have to put in the time, but the judgment is more important. The direction you’re heading in matters more than how fast you move, especially with leverage. Picking the direction you’re heading in for every decision is far, far more important than how much force you apply. Just pick the right direction to start walking in, and start walking.
    1. Velocity
  7. The really smart thinkers are clear thinkers. They understand the basics at a very, very fundamental level. I would rather understand the basics really well than memorize all kinds of complicated concepts I can’t stitch together and can’t rederive from the basics. If you can’t rederive concepts from the basics as you need them, you’re lost. You’re just memorizing. The advanced concepts in a field are less proven. We use them to signal insider knowledge, but we’d be better off nailing the basics.
    1. First Principles
  8. Mental models are really just compact ways for you to recall your own knowledge. I think a lot of modern society can be explained through evolution. One theory is civilization exists to answer the question of who gets to mate. If you look around, from a purely sexual selection perspective, sperm is abundant and eggs are scarce. It’s an allocation problem. Literally all of the works of mankind and womankind can be traced down to people trying to solve this problem. Evolution, thermodynamics, information theory, and complexity have explanatory and predictive power in many aspects of life.
    1. Mental Models
  9. To me, the principal-agent problem is the single most fundamental problem in microeconomics. If you do not understand the principal-agent problem, you will not know how to navigate your way through the world. It is important if you want to build a successful company or be successful in your dealings. It’s a very simple concept. 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.
    1. Microeconomics / Principal-Agent
  10. Least understood, but the most important principle for anyone claiming “science” on their side—falsifiability. If it doesn’t make falsifiable predictions, it’s not science. For you to believe something is true, it should have predictive power, and it must be falsifiable. I think macroeconomics, because it doesn’t make falsifiable predictions (which is the hallmark of science), has become corrupted. You never have a counterexample when studying the economy. You can never take the US economy and run two different experiments at the same time.
    1. Falsifiability
  11. No one in the world is going to beat you at being you. You’re never going to be as good at being me as I am. I’m never going to be as good at being you as you are. Certainly, listen and absorb, but don’t try to emulate. It’s a fool’s errand. Instead, each person is uniquely qualified at something. They have some specific knowledge, capability, and desire nobody else in the world does, purely from the combinatorics of human DNA and development. The combinatorics of human DNA and experience are staggering. You will never meet any two humans who are substitutable for each other.
    1. Permutations & Combinations
  12. The first thing to realize is you can observe your mental state. Meditation doesn’t mean you’re suddenly going to gain the superpower to control your internal state. The advantage of meditation is recognizing just how out of control your mind is. It is like a monkey flinging feces, running around the room, making trouble, shouting, and breaking things. It’s completely uncontrollable. It’s an out-of-control madperson…The ability to singularly focus is related to the ability to lose yourself and be present, happy, and (ironically) more effective. It’s almost like you’re taking yourself out of a certain frame and you’re watching things from a different perspective even though you’re in your own mind. Buddhists talk about awareness versus the ego. They’re really talking about how you can think of your brain, your consciousness, as a multilayered mechanism. There’s a core-base, kernel-level OS running. Then, there are applications running on top. (I like to think of it as computer and geek speak.)
    1. Meditation
  13. I’m not going to be the most successful person on the planet, nor do I want to be. I just want to be the most successful version of myself while working the least hard possible. I want to live in a way that if my life played out 1,000 times, Naval is successful 999 times. He’s not a billionaire, but he does pretty well each time. He may not have nailed life in every regard, but he sets up systems so he’s failed in very few places
    1. Authenticity, Systems > Goals

What I got out of it

  1. As with all great books and deep wisdom, something new is uncovered every time you read it. This is certainly true for this almanack of naval’s