A book that opened my eye and after reading it I cannot go back to the life I lived before. Part 1

The Almanack of Naval Ravikant: A Guide Wealth and Happiness (The book is free to download)

Navals have a philosophy, that a book is not worth buying if the author’s only aim is to make money.

If I would have to compare this book. It would be a puzzle. You put piece by piece together and at the end when it all comes together you might just yell up “Heureka” just like Aristoteles did when he understood, that each object losses as much weight from itself as is under the water. I wish it would be this simple. There are plenty of billionaires in the world, however, you would have to use a magnifier to find a happy one.

Let us get back to the question who this genius is who believes he holds the philosopher’s stone and knows the meaning of life he says it is not 42. Except if it is 42 billion spent happily? Probably, that would be time for a second article.

So, who is Naval Ravikant the successful Indian start-up investor? Naval is a brilliant entrepreneur, investor, and tinkerer. He is without a doubt one of the most innovative minds in venture capital. the CEO (Chief Executive Officer) and co-founder of AngelList. He is invested in more than 100 companies, including Uber, Twitter, Yammer, and many others.

Naval is an incredibly deep thinker who challenges the status quo on so many things. During His typical day, he is working on AngelList; however, he believes there should not be a concept of having to be somewhere at a specific time. He aims to do what he wants to keep being productive and happy. There should not be 40–60–80 hours per week but just a balance of productivity and happiness. His first love was books as he was reading and raised by a single mother in New York in one of the not-so-good neighbourhoods he spent his time in the library just exploring whatever he found on the shelves. To this day he admires, the fact, that nobody told him what to read and he was just able to explore the types of books he liked. For him, the most common is to read something on an iPad, however as soon as he likes a book, he will also buy a physical copy of it. Living by the call o, you do not need to read all the books but reread the 100 best books you ever read. He loves to read whenever he has free time. “The best books to read or on Twitter are the ones you are excited about all the time.”

Let us get to the book it has two parts Building wealth and Happiness. Building wealth is divided into Building wealth and Building judgment.

We will start with Building wealth Naval beliefs:

“Making money is not a thing you do — it’s a skill you learn.”

So, you are thinking about how to learn it?

· First, you need to get into a relative mindset, you are always going to hate people who do better than you, and you are always going to be jealous or envious of them. Wealth creation is an evolutionarily recent positive-sum game. “If you secretly despise wealth, it will elude you”?

· There is always somebody richer so because of this comparison does not make sense and only leads to unhappiness. The status game is a zero-sum game as moving ahead always requires pushing somebody down, while making money does not necessarily mean it.

· Until you sell your time to somebody else you cannot become rich. There will be always social inflation eating up your expenses.

One of the fundamental issues is, that without ownership your input will be aligned with your output. What does this mean? It means as long as you are working directly for your money 1h of work will result in X amount of money and there will not be any other multiplier. However, when you own the equity in a company you own the upside. In this case, the best is to reach by working a point when you can start to own more and more equity.

You could own equity as a small shareholder, however, if the company solely depends on your input to existing, then you are not yet owning equity. Equity is when the company’s performance is independent of you. As a shareholder, you are looking for compounding interest.

The best way to get compounding interest is to create leverage.

There are 3 types of leverage. One form of leverage is labour — other humans working for you. This is the hardest and requires management skills.

2nd is money a good form of leverage it is scalable as more and more capital can be handled easier and easier this creates exponential growth. However, also being a CEO is in the same category.

The final form of leverage is brand new — the most democratic form. It is a” product with no marginal cost of replication” This includes books media and so on. For example, the Joe Rogan podcast is a perfectly matching example, and it represents a unique type of podcast. It looks like the future of millionaires will come from the monetization of these platforms.

This directly connects with Navels next point which is scalability.

· The difference in scalability is how we switch from working and spending our time to earn money to how to make money with our decisions. “Earn with your mind, not your time. The worst kind of job is someone who is doing labour to repair a house. In this case, your time what gives you the money at the end it is unscalable and will stop quite fast.

· The next level might be the general contractor working on the house for the owner. Why is it better? This person has accountability.

· The next level up is the real estate developer who can use financial leverage to do independent projects.

· The next level up might be someone who manages money in a real estate fund. This has enormous leverage.

· One level beyond might be something like the Zillow platform which creates a place to buy and sell homes. This without additional costs can create profit. The best businesses are those which are built on the creativity of continuous learners in free markets. It is important to try to be the best in a specific market, and important to stay authentic and not to copy anybody to eliminate competition perfect example is the Joe Rogan podcast

You should be passionate about your field. “If you’re not obsessed with it, you’ll never master it.” — Shane Parrish

Take on accountability.

· Embrace accountability and take the business risk under your own name. Society will reward you with responsibility, equity, and leverage.

· Whenever you can in life, optimize for independence rather than pay. If you have independence and you are accountable for your output as opposed to your inputs — that is the dream.

Prioritise and focus

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. A good example is buying a robot vacuum cleaner might be expensive at the beginning but if you divide it into working hours you are saving.

People are crucial

· Play long-term games with long-term people.

· Excellent people will pull excellent results even when the beginnings are not so easy.

Spend more time making the big decision there are three really big decisions you make in your early life: where you live, who you are with, and what you do. You should take 2 days a week to think and let your creativity flow without any distractions.

What if you are doubtful?

If you cannot decide, the answer is no. And the reason is, modern society is full of options. There are tons and tons of options. We live on a planet of seven billion people, and we are connected to everybody on the internet. There are hundreds of thousands of careers available to you. There are so many choices. This is also related to investments when you do not like a certain stock, or you are not confident let it go

Conclusion

The book also emphasizes the importance of taking a long-term view of wealth and success. The author suggests that individuals should focus on creating value and building relationships that will lead to long-term success and fulfillment. By doing so, individuals can achieve financial security and personal fulfillment.

The book suggests that wealth and success are not the end goals but rather the byproducts of living a life that is aligned with one’s values and interests. By prioritizing personal growth and fulfillment, individuals can achieve both wealth and success in a way that is meaningful and fulfilling.