Humans evolved in societies where there was no leverage. If I was chopping wood or carrying water for you, you knew eight hours put in would be equal to about eight hours of output. Now we’ve invented leverage — through capital, cooperation, technology, productivity, all these means. We live in an age of leverage. As a worker, you want to be as leveraged as possible, so you have a huge impact without as much time or physical effort.A leveraged worker can out-produce a non-leveraged worker by a factor of 1,000 or 10,000. With a leveraged worker, judgment is far more important than how much time they put in or how hard they work. - Naval Ravikant
Leverage allows you to accomplish 100x what others can – it is a force multiplier for your effort, skill, and judgement. Today, we live in an age of infinite leverage where our work can be replicated at no cost, and we don’t need permission to get started.The economic rewards for genuine intellectual curiosity have never been higher – it’s time to make today’s labor tomorrow’s leverage. - Andrew Yu
Related to the law of compounding, the power of leverage increases that exponential growth of one form to infinity and beyond.
Old forms of leverage such as labour and capital, are good but ineffecient because they require two things: Cost and Permission.
With a simple example of capital, here's what it means:
- Cost - You must exchange something (hours of work, equity) in order to acquire capital.
- Permission - Someone still holds the purse strings to give you the money.
This new school of leverage, driven by the internet, has the benefits of having very low cost and requiring no permission:
- No marginal cost of replication - Digital products whether they are ebooks, videos, and courses do not have any cost to replicate. Unlike physical books that have print runs, digital books (ebooks) have unlimited potential.
- Permissionless - Whether its writing a book, producing a podcast or recording a YouTube video, you don't need permission to do this. This creates lots of equality for creators.
These features and benefits of the new school of leverage, driven by the internet, has created infinite possibilities:
- The Hustle, an email newsletter with 1.5 million subscribers was sold to HubSpot. A company that creates email newsletters, just email, sold to a public listed company. 🤯
- A Youtuber, former Nasa engineer Mark Rober creates amazing videos that reach hundreds of millions of viewers. The shark video below is merely 88 million views, far from his best one.
All you really need today is a computer, the internet and you can build your own Mountain of Levers.
How can you take advantage of this new age of leverage?
- Understand how ideas spread through words. Then build a website. Write and produce high quality content. Let the internet do its thing.
- Start looking at building digital real estates. This is an idea I heard from Grace Teo, who has build her own version of it to great success. Love the tagline "Rental income without the tenants". It is your asset that you own, without the high cost of ownership.
This new economy is here whether you are part of it or not. Start rising above the clouds and check out the new horizons. The mountains are everywhere.
Hold on to your levers.