
AI is the ultimate leverage, but only if you know what to ask.

Leverage is the ability to multiply your effort.

It began with technology - fire, the plough, the wheel.

Then came capital and labour: you raised money or hired people to do more than you could alone.

The digital age unlocked two new forms: code and media.

With these, you can create products that replicate at zero marginal cost. Unlike earlier forms, they're permissionless, you don’t need approval to use them.

Now, a new form of leverage is emerging: Large Language Models.

Not just another tool, but one that amplifies every other tool.

This is intelligence leverage, the multiplier of multipliers.

Industrial automation scaled tasks. AI scales thinking.

A solo developer can build in days what once took months. Creators can produce content at unprecedented speed. Entrepreneurs can scale with leaner teams.

The barriers to entry aren’t just lowering, they’re collapsing.

Anyone with a laptop now holds leverage once reserved for large companies.

But this abundance creates a paradox: access is no longer the constraint, judgment is.

When execution is cheap, taste, vision, and clarity become your edge. The bottleneck shifts from doing the work to knowing what work to do.

Winners won’t be the ones who use AI, but the ones who wield it well. The sharper your questions, the clearer your context, and the deeper your understanding of its limits, the more leverage you unlock.

In a world where everyone has access to infinite tools, the advantage goes to those who know what to build and why.

Leverage is no longer about what you have, it’s about what you choose to do with it.


Intelligence Leverage


Innovation isn’t a goal. It’s a side effect. You don’t “create” it, you stumble into it by working on real problems. Stop trying to “invent”. Hunt pain points. Problems are the signal, the raw truth, carved by the constraints you can’t escape.

Constraints aren’t the enemy, they are forcing functions. They kick you off the map into areas you wouldn’t explore. Obstacles push you towards solutions that others miss.

In hindsight, the best solutions are obvious. But simplicity is earned. It’s the reward for sweat and struggle. There are no shortcuts. No cheat codes. Just work and belief.

Cynics don’t innovate, they look for excuses. Optimists bet on what’s possible, even against long odds. Believe there is a way, take the risk, and you’ll often find one.

Risk is the entry fee. Failure should be on the table, it’s part of the innovator’s game. When you fail, treat it like data. Swing again.
Innovation thrives in boredom. Not the scroll-your-phone kind, the deep, uncomfortable stillness when there's nothing left to distract you. That’s when your brain starts rearranging the furniture. You revisit old ideas with fresh eyes. Patterns emerge. Connections click. Most people panic in that quiet. Innovators lean in.

Innovation’s not a formula; it’s a craft. Curiosity sparks it, constraints shape it, optimism fuels it, persistence finishes it. Stop chasing “big ideas.” Hunt problems. Embrace the chaos. The rest follows.


Innovation


Simple solutions are deceptive. They look obvious in hindsight but rarely feel that way when you're in the thick of a problem. Occam’s Razor, a principle that suggests the simplest explanation is usually correct, captures this idea well. Simplicity isn’t about oversimplification; it’s about avoiding unnecessary assumptions and complexity. And while it’s a guideline, not a law, its relevance to engineering is clear.

Why? Because complexity is costly. Complex solutions take longer to build and rely on more assumptions. More assumptions mean a higher risk of failure. Simple solutions, by contrast, reduce the surface area for errors and are faster to develop, scale, and maintain.

This applies across engineering, both hardware and software. Systems with fewer moving parts are easier to debug, upgrade, and adapt.

Getting to simple is not easy. Engineers love to over-engineer. The urge to add features for the sake of “better functionality” is misguided. When you face a new problem, there will be unknowns, and the simplest solution won’t be obvious. That’s okay. The process is iterative: build something, test it, and learn from the results. With each iteration, strip away the unnecessary. Simplify.

The Pareto Principle can help. Focus on the 20% of effort that solves 80% of the problem. Ignore the urge to perfect everything on the first try. Progress beats perfection.


Simple engineering


Startups are a long-term game. Success takes time, usually far longer than you expect. While startups move fast, that’s their inherent advantage, they must still navigate the slower pace of the external world. Others won’t match your speed of execution, and your urgency won’t make them move much faster.

This is why persistence is a key attribute of successful founders. It helps you push through setbacks and delays, keeping you moving forward when everything is against you. Talent and intelligence can only take you so far; persistence matters more. As the classic startup advice goes, “just don’t die.”

Think long-term. Maintain your momentum and urgency, but accept that everything will take longer than it should. Startups are a marathon and not a sprint.


Why startups are a marathon & not a sprint


Startups create wealth by building things society wants but doesn’t yet know how to get. The wealth created can be considered:

Wealth = (No. of Users) x (How Much You Improve Their Lives)

As a founder, you have more control over how much you improve users’ lives than over how many users you can reach. The more you improve lives, the more users will come.

The hardest part of a startup is deciding what to build to improve users’ lives. But how do you figure that out? The clearest signal is when someone pays for your product or service. Importantly, figuring out what to build isn’t a one time decision. It’s a continuous process. As you build and listen to your users, new ideas will naturally emerge.

Steve Jobs famously said, “customers don’t know what they want”. Users won’t tell you what to build, but they’ll show you the problems to solve. Focus on understanding why users want something as this reveals the root problem, not just the symptoms.

Seek feedback from real users with genuine needs. Be cautious of friends and family, they mean well but often offer biased encouragement over genuine feedback.

This focus on understanding users underpins much of the conventional advice given to startups. Launching early is about getting real feedback as soon as possible. Exceptional customer service keeps you close to your users. And iterating over time is simply the natural outcome of listening to and acting on that feedback.


Understanding users is key for startup success


Success isn’t about talent, it’s about working hard. Society loves the idea of natural talent and downplays hard work, but if you look closer, big achievements come from people who worked relentlessly.

You can't just work hard; you have to work smart. Pick the right problem. Find a high-leverage area where your effort creates exponential results.

The best way to make hard work count is to keep levelling up your skills. The more you learn, the more impact each hour has. When you combine effort with valuable skills, the result is like compound interest.

Who you work with matters. If you're around people who make you want to do better, you will. If your teammates push you, you'll work harder. Find those people, and stick with them.

Passion matters too. Hard work is much easier when you love what you do.  Real passion isn’t just enjoyment; it’s being willing to push through discomfort.

Hard work isn’t a sprint, it's a marathon. Burn out too fast, and you’re out of the game. Pace yourself. Build sustainable habits that turn hard work into routine. Those habits make your efforts compound over time.

Setbacks happen and you will experience failure. But failure is just information. It's feedback. Learn to embrace it.

Set big goals. Then get to work.


Work hard


Action equals information. By acting, especially in uncertain situations, you learn far more than thinking or planning.  The faster you act, the faster you learn, creating a flywheel of growth.

In a startup, you need a bias for action. For startups, speed is survival, especially in the critical stages before profitability.

Fast iteration builds momentum, and momentum is energising. Speed of execution is a core advantage against incumbents, who are slowed by bureaucracy and risk aversion. The benefits of speed compound over time.
Practically, how do you execute faster?

1. Reframe your approach. Ask yourself, how can this be done 10X faster? This question forces you to challenge assumptions and find more efficient paths. Sometimes it’s not about finding a shortcut, but realising the task isn’t needed at all.

2. Prioritise and focus. Your capacity is finite. Be ruthless and focus on what matters most. Prioritisation means saying no to some good ideas in pursuit of great ideas.

3. Make decisions quickly. If you wait for 100% certainty, you’ve taken too long. Mistakes will happen, but the benefits of speed and momentum outweigh the occasional cost of mistakes. 

The founders set the pace in a startup: create a sense of urgency, make decisions quickly, and celebrate speed.


Speed


Build in every sense of the word: build yourself, build skills, build knowledge, build products, build communities, build businesses. Why build? Because building is creating and growing. It’s fundamental to being human. You don’t need permission to build.

Building is both internal and external. As you create things in the world, you grow, learning and adapting along the way. Building yourself is the foundation for everything. Building is hard, but there is beauty in the struggle. Learn to love the process.

When you build, you learn to trust your skills and judgement. It gives you agency, the power to shape your own destiny. Building grants freedom and confidence. It’s a form of creative expression, leaving your unique mark on the world. What you build reflects your values, ideas, and vision. There’s immense satisfaction in seeing your ideas take shape, in creating something that makes a real, positive impact.

Building isn’t a selfish act. When you build, you contribute to humanity, adding value, driving innovation, inspiring others, and improving lives.
Founding a business is building in its rawest form, where ideas meet the market, the ultimate arbiter of the truth.  It’s a forcing function for everything outlined above.

Building a company lets you create value that scales beyond your time and effort. Wealth isn’t about money, it’s about freedom. Building a meaningful business is one of the few paths to lasting wealth.


Build


Thinking for yourself is the foundation of wisdom. It allows you to seek truth and live authentically, rather than being governed by others' beliefs. Independent thinking is required to create something novel, whether starting a business, investing, or making scientific breakthroughs. Real innovation demands it.

Most people struggle to think independently and adopt the thoughts of their peers. This is an easy trap to fall into. Thinking critically starts with self-awareness: understand your biases, emotions, and external influences. Challenge your beliefs and question your understanding.

Paul Graham argues that independent-mindedness has three components: precision about truth, resistance to being told what to think, and curiosity. These components work together, each supporting or compensating the others.

Be precise in evaluating truth. Consider your degree of belief in something, not just whether it's true or false. Avoid rushing to conclusions, and be comfortable with uncertainty. Stay open to changing your mind when new evidence emerges.

Resisting being told what to think isn't just about rejecting ideas, it's actively exploring unconventional ideas and seeking truth even when it challenges popular beliefs.

Curiosity is perhaps the most important element. It drives new ideas. Cultivate curiosity by exploring topics that genuinely interest you, and avoid things that suppress it. Independent thinking is powered by the desire to explore, to question, and to discover.


Finding your thoughts


Believe in yourself. To achieve anything meaningful, you must first believe in your own potential and ability. Most people never reach their potential because they lack belief. You are capable of much more than you realise.

No one will believe in you as much as you believe in yourself. You define this maximum. Understand yourself and accept who you are, both your strengths and weaknesses. Self-belief grows from self-awareness.

Confidence grows from action. As you succeed, your belief in yourself will grow organically. Self-belief compounds over time. People respond to confidence and conviction. When you project confidence, others will naturally start to believe in you too. When setbacks happen, use your belief to keep you grounded and help you persevere.

Surround yourself with optimistic people. It’s easier to believe in yourself when you have a supportive environment. Seek out mentors and friends who encourage your potential. Culturally the US is better at celebrating ambition and success compared to the UK. Adopt this mindset and build a culture of positivity around yourself.

Don’t compare yourself to others. Self-belief comes from understanding that your path is yours alone, and there is no single timeline or metric for success. Trust that you are on the right path for you, even if it looks different from someone else's. Don’t seek approval from others and trust your own judgement.


Believe in yourself


Productivity isn’t about being constantly busy, it’s about working effectively when you choose to. Productivity is valuable because it compounds. Small improvements lead to massive gains over a lifetime.

Choosing what to work on is the most important part of productivity. Think for yourself, and set long-term goals that are important to you. Then, focus on tasks that drive you toward those goals. Use lists to stay organised and say “no” to anything that doesn’t align with the goal.

Resist the urge to stay busy for appearances. Keep things simple and focus on the tasks that bring the most value.

Optimise your day around your energy levels, work when you’re at your peak and rest when you’re not. Create an environment that supports focus, with long blocks of uninterrupted time. Context switching is the enemy of focus. Where possible schedule deep work sessions and protect them fiercely.

Surround yourself with smart, positive people who uplift and inspire you, and avoid those who drain your energy.

Physical health is foundational. Prioritise sleep, exercise, and a healthy diet.

A little overcommitment can drive efficiency, but too much leads to burnout. Find balance: push yourself, but know your limits. Productivity isn’t just about managing time; it’s about managing your energy.


Productivity is working on the right things, not being busy


Most people are motivated by external approval. They play status games, choosing safe, conventional paths, more focused on keeping pace with others than on their own growth. To reach your full potential and contribute meaningful work, you must shift your focus to your own internal motivation.

Most people are unaware of their internal motivations. This takes deep self-reflection and honesty. A good starting point is exploring your interests and trying new things. Think about what excites you, what problems you want to solve and then take action. Don’t fear being a beginner. Embracing the beginner’s mindset is a superpower; free from the weight of expertise, you're open to fresh ideas and new approaches.

Working on your interests is a good way to discover startup ideas. Starting a business is extremely difficult, a relentless, uncertain journey where failure is the most likely outcome. So, why take the risk? Because regardless of the result, building a startup fuels your curiosity and maximises your rate of learning. It offers creative freedom and full control over your work. And if you're fortunate enough to create something that society values, the reward goes far beyond financial gain, it’s deep personal fulfilment.

Do things to discover what you’re capable of and make an impact on the world. Measure success by the volume of meaningful work you produce in areas that matter to you. As Paul Graham puts it, “the root of great work is ambitious curiosity”.


Most people are unaware of their internal motivations


Why write? While everyone understands the value of reading, the benefits of writing are often overlooked. It’s only when you try to write about a topic that you realise you didn’t know it as well as you thought. Writing forces you to turn your thoughts into words,  often revealing that your ideas are unclear, incomplete, or even contradictory.

Writing is a process. The first draft, written quickly, captures your thoughts and exposes gaps in your understanding. Most of your time should be spent revising and refining, gradually making the topic coherent and complete. Surprisingly, most of your ideas will occur after you begin writing. Writing externalises your thoughts and helps you reflect more deeply. While it doesn’t guarantee you’re correct, it does sharpen your understanding.

Writing requires more precision and structure than reading or speaking. As Richard Feynman said, “If you want to master something, teach it”. In a sense, writing is like teaching yourself, it’s one of the best ways to learn. It’s a tool for self-improvement, encouraging growth through reflection, like having a conversation with yourself.

Writing also creates a permanent record of your thoughts, which you can revisit, refine, and build upon. Sharing your writing allows you to test your ideas in the real world, creating a feedback loop for new perspectives and insights. Writing not only strengthens your ideas, but also improves your ability to communicate them.


Writing is like teaching yourself


Engineers love jumping to solutions. It feels natural to start building right away, but this is a common mistake. Without fully understanding the problem, you're likely to solve it inefficiently, or not at all. This leads to unnecessary complexity, like extra code or hardware, without solving the core issue.

Defining the problem is about uncovering core truths and assumptions. These are the irreducible facts that reveal the true nature of the problem. What are the facts? What’s just a guess? This clarity is essential. One practical technique is simply to ask “why” over and over, peeling back the layers until you reach the core truth.

Once the problem is defined, use first principles thinking to find a solution. This means taking the components of the problem and reasoning upward to build a solution. This approach frees you from traditional methods. Instead of just applying what’s been done before, you can create something from the ground up.

Traditional thinking relies on frameworks or engineering requirements. These are intended to streamline processes and capture company knowledge. In practice, they can stifle innovation and produce generic solutions. First principles thinking challenges these norms. By questioning existing solutions, your own assumptions, and taking a contrarian view, you can often uncover new and alternative approaches.

If there’s one takeaway, it’s that deep understanding is the key to solving any problem. This is the foundation of good engineering.


Thinking from first principles


Happiness comes from habits. The brain forms habits to conserve energy by automating repetitive actions. Whether a habit is good or bad depends on its lasting effect on your life. Growing happier with age is partly the result of building good habits over time.

Bad habits are rooted in instant gratification which makes them easy to accumulate. The quick reward of a sugar rush or impulse purchase is hard to resist. In contrast, good habits, like exercise or healthy eating rely on delayed gratification, making them harder to form.

Habits are powerful because they compound. Small, consistent actions can create significant change. When ingrained, habits make positive behaviours easier and help you break free from the instant gratification cycle.

To build good habits, use heuristics and cognitive tendencies to your advantage. Focus on one habit at a time and start small to avoid becoming overwhelmed and build momentum. Trying to change everything all at once will not work. Tracking progress helps you stay committed. Visualise yourself as the person who naturally embodies the habit. Instead of setting a goal like "I want to run a marathon" think "I am a runner" and you will naturally start making choices that align with that identity. Use social proof by sharing your goal with friends to create accountability. Lastly, adjust your environment to support your goals—like meal planning and shopping on a full stomach to make healthy eating easier at home.

Continually reassess your bad habits and replace them with good ones. In the end, you are the sum of your habits.


You are the sum of your habits


The path to success isn't about choosing between being a generalist or a specialist; it's about embracing both by becoming a perpetual learner who can quickly adapt and master new skills.

Society encourages specialisation in one area of expertise, but in a rapidly changing world, this can be risky. Technology can quickly make specific skills obsolete. The ability to adapt and learn new fields is far more valuable than relying on outdated knowledge.

Early in life, explore different paths until you find something that excites you. Passion fuels sustained effort, creativity, and fulfilment. Once you discover it, specialise and go deep. Specialising gives you a strong foundation, credibility, and the ability to spot unique opportunities within your field.

After mastering one area, don't be afraid to start over or explore across other fields. This is where real magic comes from. Gaining knowledge across multiple disciplines makes you more adaptable and allows you to spot opportunities at the intersections of different fields. Learning mental models from different areas improves decision making and prevents you from seeing every problem through the narrow lens of one specialty.

Startups often begin by solving a specific problem for a niche audience. Many successful founders start with deep expertise in one field. But as a founder, you'll be forced to do many different tasks. You will need to learn quickly and broaden your skill set.

Approach life with curiosity and embrace a mindset of continuous learning, as it drives success.


Generalist vs specialist


Curiosity is the start of knowledge. It's a compass that guides you in understanding both yourself and the world around you. Curiosity drives learning and growth, leading to deeper understanding, greater compassion, and a more meaningful connection with the world. Today, technology makes nurturing curiosity easier than ever.

Curiosity is the natural pull towards genuine interest. It's an intrinsic drive that makes learning effortless and enjoyable. It encourages you to explore new ideas, ask deeper questions, and seek knowledge for its own sake. It creates a positive feedback loop where learning fuels more curiosity, which in turn drives further exploration and growth.

As a child, you have a sense of wonder and joy as you discover the world around you. Yet, for many, this fades into adulthood under the weight of responsibilities, routines and societal norms. The struggles of life can overwhelm your childlike sense of curiosity. Recognise that this doesn’t have to be the case. Embrace the beginner's mindset and let your inner child guide you.

Curiosity may lead you down paths where you risk looking foolish or may face failure. Starting something new is not easy, but have the courage to overcome this fear and recognise this is where true growth and innovation happen.

Founders are naturally curious. They see problems that others miss and become obsessed with understanding them. This deep, persistent curiosity pushes them to keep learning, iterating, and refining their ideas until they build something meaningful. Great ideas begin with curiosity.


Great ideas begin with curiosity


Is success a result of luck? Success is a combination of skill and good fortune. Fortunately, luck isn’t just a matter of chance. You can increase your odds of getting lucky to the point where it almost feels inevitable.

There are different types of luck, and most can be influenced. First, there’s blind luck, the kind that just happens, outside your control. It’s what most people mean when they talk about luck.

Then there’s the luck that comes from being persistent. If you work hard, take risks, and create opportunities, you expand your "luck surface area". This is where hustle meets serendipity, you create enough momentum for luck to find you.

Another way to find luck is by developing expertise. Skilled people are more likely to recognise a lucky break. It’s not that the opportunities weren’t there for others; they just didn’t see them. You become luckier simply because you’re more attuned to the signals.

Finally, there’s luck that comes to you because of your unique brand or reputation. If you’re the best at what you do, people will bring their luck to you. Imagine you’re a world-class locksmith. One day, someone stumbles upon an ancient, mysterious safe that no one can open. Their discovery becomes your lucky break when they seek your help, and you benefit from it.

But here’s the key: always recognise the role of luck in your success. Don’t underestimate the impact of factors beyond your control. Stay humble, and keep a nuanced perspective. Success is part skill, part timing, and part being open to the opportunities that luck presents.


You can engineer your own luck


Focus is a superpower in our age of distraction. It amplifies efforts and fuels innovation. In a world designed to capture attention, your ability to resist distraction is a major asset. Focus is key to meaningful work and deep insights.

However, focus isn’t enough. It must be channelled towards what matters most.  This is essential in startups, where the to-do list is infinite. Direct focus at tasks with the greatest impact. Prioritise long-term gains over immediate demands and be protective of your time.

Context switching is the enemy of focus. We are optimised to focus on one task at a time. Constant interruptions and task switching conditions your brain for distraction. Focus is like a muscle, it strengthens with practice. The more you cultivate it, the more natural it becomes.

Focus and productivity aren’t sustainable around the clock. Breaks are essential for long-term performance. Quality over quantity matters. A startup journey is a marathon, not a sprint. Identify your peak focus times and use them for important tasks.

In the end, focus isn't just about what you do, it's about what you choose not to do. Mastering focus is mastering your time.


Mastering focus is mastering your time


Innovation demands risk. Progress comes from dreaming big and taking small, calculated steps towards your vision. The world changes when people dare to try new things. Startups are risky by nature and entrepreneurs embrace this.

Many overestimate risk and underestimate reward, prioritising short-term gains over long-term fulfilment. While staying within the known feels safest, real learning occurs outside your comfort zone. Don’t let the fear of failure prevent you from creating something remarkable. Accept failure as part of the risk-taking process and use it as a stepping stone to success.

Avoid blind gambles. Gather information, evaluate potential outcomes, and make informed decisions. Seek asymmetric risks where the upside far outweighs the downside. Be aware of cognitive biases like loss aversion that can affect your judgement and hinder rational decision-making.

Diversify to mitigate risk, but recognise that breakthrough success often demands singular focus. Startups embody this paradox: focused yet adaptable, they manage risk by starting small, listening to the market, and iterating quickly.

Take risks earlier in your career, when you have less to lose and more to gain. If you can meet your basic obligations, take more risk. Risk cultivates new skills, builds resilience, and drives personal growth.

In a world of exponential change, embracing risk is the only way to thrive. As Peter Thiel said, the biggest risk is not taking any risks at all.


Embrace risk and dream big


Reaching your potential requires persistence. Understand that you have the ability to ‘put a dent in the universe’. Most people fail because they lack confidence, give up too soon, or don't push hard enough.

Persistence is crucial for founders. Every startup will face repeated failures; this is inherent when solving large problems. Failure hurts, but bouncing back is harder. Failure is feedback for your next iteration. Resilience means staying positive when things go wrong. Setbacks can affect your plans, but not your morale. Your initial reaction to a setback shouldn’t be to quit or change direction. Persistent people know when it’s the right time to change their mind. Persistence requires good judgement.

Persistent people have a lot of energy. They push forward and keep trying things. Energy fuels the demand for new ideas, and imagination and creativity are essential to develop ideas that go beyond initial solutions.

Persistent people will focus on a goal, but remain open minded in how to achieve it. The initial approach to solving a problem is the least informed. You must learn and adapt your method. Obstinate people are determined in a different way to persistent people, they are stubborn. They attach themselves to an idea of how to reach that goal.

Successful people are optimistic. If you think you’re going to win, it doesn’t mean you're going to win. If you think you’re going to lose, you will lose. Luck plays a role in any success story, but you can create luck. If you are persistent long enough and create enough opportunities, you give yourself more chances for luck to go your way.

Reaching your potential requires persistence


Wealth is not the same as money. Wealth is the collection of things that improve your life and bring you joy. Wealth is what we truly want: food, clothes, houses, physical and mental health, meaningful relationships, control over your time.

You can have wealth without money. Money is a way to transfer wealth and time. You can grow and sustain wealth by owning assets that earn money while you sleep.

Companies are groups of people working together to create wealth by doing something people want. The wealth created is the average work of all people at the company. Some people, like 10x software engineers, can create wealth faster than others.

Startups offer better opportunities to capture wealth than large companies. This is partly due to the competitive dynamics of startups versus incumbents, which I will save for a future topic. It’s also because a startup’s size makes it easier to measure each person's contribution to wealth creation. If you’re unsure whether a startup is creating wealth, having customers is a good indicator.

Wealth can be created and destroyed, but there isn’t a fixed amount of it in the world. It’s wrong to believe that if one person gets more, someone else must get less. For example, if a farmer invents a way to double her crop yield without using more land or resources, she can sell more food and increase her wealth. Her customers also benefit from more food at lower prices. She has created more wealth.

Creating wealth ethically is possible. By building with integrity, transparency, and fairness, you are generating value for society.

Create wealth by making things people want


Compounding is a superpower. It’s not just about money; it’s everywhere - in relationships, health, learning and so on. Humans struggle to understand compound interest because our brains are wired to think linearly, not exponentially.

Most careers progress linearly. Seek work that compounds. As your career progresses, each unit of work should produce greater results. Building a startup, brand or audience compounds in two ways: directly through the inherent leverage of these methods and indirectly through the learning gained in the process. If you’re learning a lot, even in failure, you’re experiencing exponential growth.

Positive habits have a powerful compounding effect. Small, consistent actions can lead to significant changes over months and years. If you improve by 1% each day, you will be nearly 38 times better by the end of the year.

Reputation compounds as well. Building your reputation unlocks access to leverage in the form of capital and people. Relationships also compound. In business, both reputation and relationships are built on trust and are the foundation of a strong network. These compounding effects often create second-order growth, amplifying each other's impact.

The biggest advantage in business is gained by long term thinking. Trust the exponential and be patient. In the words of Naval Ravikant, play long term games with long term people.

Compounding is a superpower


Leverage creates a disconnect between your inputs and outputs. Leverage allows you to earn non-linearly and achieve an oversized impact with your time. Without leverage, your compensation is tied directly to the hours you work.

Leverage comes in different forms. Labour and capital are permissioned leverage, requiring credibility to obtain. Labour, the oldest and most challenging form, involves managing people.

Capital uses money to amplify the effects of decisions. Deploying capital productively takes skill but is easier to scale than managing more and more people.

Technology (specifically code) and media are modern, permissionless forms of leverage. These are products you create yourself with no marginal cost of replication. You don’t need permission to succeed, and you can multiply your efforts without involving others. Code allows you to serve customers while you sleep. Media, whether through writing a book or building a brand on platforms like X, YouTube, and podcasts, enables you to scale your work to reach millions.

Startups offer a path to leverage by combining various forms to solve difficult problems. Solving a problem that many people care about creates value for everyone who uses your solution.

A good indicator of leverage is the potential for failure. Starting a business risks founders' credibility, time, and capital.