James Altucher On Failure, Creativity, Money And ‘Entrepreneurship Porn’

James Altucher is not exactly average. He is a serial entrepreneur co-founding around 20 companies, podcast and TV personality, author and advice-giver to millions around the world. He has made and lost millions and offers opinions on everything from “why did Google create Alphabet?” to “what are the most common life mistakes young people make?” The Pnut caught up with him to ask for his advice on life, money and generally everything.

How do you start every day?

  • I read every morning. Currently Robert Green’s book Mastery and Dave Egger’s book Staggering Genius,which are both beautiful with a lot of knowledge in them.
  • I write for about two hours, then usually have coffee and exercise.
  • I write down a list of 10 ideas on a certain topic every day. I exercise my creativity every day. It’s a like a muscle.

What advice would you give to our readers (mostly young professionals)?

This is always a tricky question, but I would say ask yourself who did I help today? You always make money when you are in the middle of helping people. If you help people then you don’t think about money and solving problems and helping people with their problems is really key both personally and professionally.

What is the best way to think about failure?

Think about failure as experimentation. Fear of failure can be paralyzing but if you look at someone like Thomas Edison, he didn’t call his 10,000 experiments failures. He kept trying and trying. The word failure implies finality whereas experimentation does not. Constant experimentation allows you to be more flexible and allows you to grow and learn from different outcomes.

A lot of our peers want to move from corporate jobs to entrepreneurship. What is your advice to them?

You shouldn’t just try to come up with an idea. Look for problems to solve around you then try it out during your job and see where it goes. Only after a lot of testing should you take the leap.

Aside from that, give yourself the best circumstances to achieve success in your life.

  • Be healthy. Your health is everything.
  • Focus on your personal relationships. If things are going well with your partner and friends then you will have more energy for everything else in life. This can be the difference between making millions and going broke.
  • Exercise creativity every day. Creativity is like a muscle that needs to be exercised. Try to come up with ten good ideas around a specific topic every day no matter how long it takes.
  • Be grateful. Start from a place of being grateful about your current job and not from a place of anxiety. If you start from anxiety it is not the best start.
  • Don’t do entrepreneurship for the sake of it, only after significant planning.
  • You can achieve great success without entrepreneurship. At one end of the spectrum of entrepreneurship is Mark Zuckerberg, but at the other is billionaire Craig Silverstein. He was number three at Google, and now he’s an employee at Khan academy He’s never been an entrepreneur.
  • There is a fad around entrepreneurship. There is a whole wave of entrepreneurship porn. It’s just that, it’s just pornography. Many rich people are not entrepreneurs. When you are an entrepreneur the known rate of failure is 85%.
  • Planning is everything. Make sure you plan plan plan plan. I spent 18 months planning my first start-up while working a full-time job. My first start-up was already profitable for a year before I pursued it full-time.
  • No one knows anything. Search engines are great examples. If you look back, I had zero ability to see whether Alta Vista or Google were better. Larry Page didn’t even have an ability to predict that Google was the one. He tried to sell Google to Xcite for $750k, and they said no. Nobody knows anything.

For the entrepreneurs out there, how do you think about investing?

My investment philosophy has changed drastically, but I now think it is very accurate. If I don’t check each of these boxes then I’ll lose all my money, 100%.

  • CEO experience. The most important part of my philosophy. Has the CEO built a company before?
  • Are current investors smart? If there are people who have invested who are smarter than I then that’s important.
  • Demographic trends. Invest in companies that you feel have strong demographic trends, for example changing tastes, age, wealth.
  • Clear path to bottom line. I invest if there a real clear vision on how you are going to make revenue and profits.
  • The deal. Am I getting a good deal, if not then I won’t.

How do you think about money?

  • You make money with a vision and a message. You can’t always help people just with money. By having a vision and a message you can build a company and create jobs. That’s the best way to make impact. Not just make money
  • Keep your money. If you make a lot of money, do not do anything with money for two years. Do not change your lifestyle, maybe celebrate a little if you make money.

The Daily Pnut Editorial Staff conducted this interview with James Altucher. It first appeared on our site on November 06, 2015. You can sign up for the Daily Pnut here.