When it comes to compounding, we tend to only think of money. After all compound interest is how our stock investments grow and how our student loans work. What if I told you life itself is about compounding?
For example, knowledge compounds. Every time you read a book you are compounding knowledge. Each year you work in your profession, you gain more mastery and knowledge. Each year you add to the knowledge of the previous years. Knowledge compounds. The more you know the more you can understand. You can only think to your highest level of comprehension. That level rises each year as you compound knowledge.
Relationships compound. Relationships are built on trust. As you maneuver throughout life you will meet and come to know many different people. As with every person you meet, initially, you both are strangers to each other. As the relationship matures you go from simple acquaintances to true friendship. Many of you reading this may be married. Initially, your spouse didn’t know you. But that stranger ends up becoming one of the most important people in your life.
When you start and stop different projects and endeavors, you are preventing the compounding from occurring. Many people don’t realize that compounding is the key to success. Without the compounding, we wouldn’t have any of the marvels of modern society.
My wife will tell you I was very anti-NFTs as of July 2021. “It has no value.”, “Who the hell will buy a JPEG?” Etc. Etc.
My thought processes regarding NFTs are largely the same, however, I realized what I think really doesn’t matter? Who the hell made me the arbiter of value? Who am I to tell someone how to spend their own money?
Then I saw adolescents flipping these JPEGs for large sums. At a certain point you have to begin asking yourself, “Am I missing something?”. NFTs have no value to me, however, they have thought me a lot about learning to roll with the tide and to remain open to possibility.
How many times has that happened in our world? Famous economists and businessmen at one time called the internet a passing fad. Hedge fund managers used to doubt bitcoin. And now NFTs are attracting the attention of prominent corporations and individuals. Are NFTS a passing fad? Maybe. Maybe not. However, I argue they are something to look into based on the underlying technology and its possible utility.
Remain open. Some of the best ideas are things we can’t even fathom right now. Learn to merge them within your areas of expertise. Think like a winner.
In business school, I learned about different types of leverage such as capital and labor. We are now in the 4th industrial revolution and it introduced tech and automation. Naturally, this has created newfound wealth for the individuals who have successfully leveraged it. But I would like to talk about the new leverage: audience.
Yes, audience. Social media created a new way of promoting businesses and getting ideas across. As cliche as it is, you don’t need everyone to like you. Hell, you don’t even need most people to like. Enter people such as the Kardashians, Donald Trump, insert any popular influencer here. They figured out a way to successfully use social media as a tool to get their agenda across. Why can’t you do the same?
Decentralization is a buzzword nowadays but many have only hit the tip of the iceberg. What if I told you this applies to media, too? What if I told you have the same tools they have (Except the social media team(s). Authentic content is better anyhow). In addition, with the functionality of these sites, you don’t have to be on them all day every day. You can schedule posts and go about your business.
Imagine the implications this has with capital raising. Traditionally entrepreneurs would have a Friends and Family round to raise money for business ventures. If you have a sufficient audience, 1 post about your project can be all you need to raise the capital. There are people right now raising $10 million in 1 week from Twitter followers. And these same followers will help you get the word out so you have customers on day 1. This drastically improves the success rate of new ventures as many businesses fail in the first year primarily due to lack of profitability.
Building an audience isn’t easy. Nor fast. Like most good things, it takes consistency and effort. But it will pay dividends going forward.
“Money is not the prime commodity in our lives… time is.”
If I were to give you a choice between 1 week or $100 dollars, to which would you assign more value? Most of us would say the $100 bucks. However, money isn’t the most precious commodity in this case. It’s time. Warren Buffett has over $100 billion to his name, but he can’t buy 100 billion weeks. Or even 100 billion seconds.
If you were to ask most older people what they would want more of, they would say time. Money wouldn’t even come up. When they say youth is wasted on the young, this is sort of what they refer to. We spend our youth doing things that ultimately won’t matter even 1 month from now. We wish we were smarter. We wish we were taller. We wish we had a better job. Etc. etc. All are examples of time wasted.
Let’s apply this concept to how we treat our careers. Most people undervalue themselves and their time. Once more, instead of finding a way to obtain the proper value for their time, they accept their realities and instead begin “living for the weekend”.
I implore you to change your paradigm. Begin treating your time as the most precious commodity on Earth. After all, you can always get 5 more dollars; you can never get back 5 elapsed minutes.
Money is important. But money is only a tool. Endeavor to buy back your time. Stop leasing it to people at a discount.
I’ve been reading a lot lately. A lot of the great movers and thinkers of the world of all races and creeds. People who have established generational legacies that will long outlive them after their deaths.
There’s one commonality I’ve noticed.
They all operate as if there are no rules. They don’t ask for permission. They ask for forgiveness.
In fact, most will say not knowing the rules empowered them because it allowed them to think outside the box.
It’s a simple concept but huge when applied to business.
Don Peebles is a black multimillionaire real estate developer. He didn’t come from money. Didn’t have any inheritances or rich uncles or assets. In building his real estate empire, he never wavered or inquired as to why he shouldn’t do something. He just did it and anytime there were obstacles he hurdled them. He used what he had to achieve his goals regardless.
Recently, I was listening to the story of Christina Qi. She runs a hedge fund and had no experience at all in the finance world besides an internship. Neither she nor her partners had any experience as high-level executives. Now they run Dormyard and manage billions of dollars in capital. They started with $1000.
And yes, sometimes people have safety nets to cushion falls (they come from money, 2 parent households, etc.), they all have had differing levels of obstacles as well. But for the committed, obstacles only serve as rest stops on their paths to success.
Act as if there are no rules.