YouTube Deep Summary

you know that moment in aladdin when he first meets the genie genie meets aladdin and he's surprised aladdin is not the usual kind of guy who gets a hold of this lamp you know this clip he pretty much knows what he wants and it generally has to do with do me a favor do not drink from that cup i promise you there is not enough money and power on earth for you to be satisfied good so what's your first wish i know a lot of you say you want to be rich but what you really want is wealth wealth isn't this or this or even this there's a lot more to it here's why you need to get wealthy instead of rich and here's how to actually do it and if you want to learn more about topics like this and how to build your next big thing be sure to click subscribe and the bell icon it's what we do here every single week now let's talk about how to actually get rich [Music] first what is wealth let's get this straight everyone talks about wanting money but that's not all there is to it paul graham says if you're in the middle of antarctica where there's nothing to buy it wouldn't matter how much money you had wealth is what you want not money but if wealth is the important thing why does everyone talk about making money it's kind of a shorthand money is a way of moving wealth and in practice they are usually interchangeable but they are not the same thing and unless you plan on getting rich by counterfeiting talking about making money can make it harder to understand how to make money here's the philosopher alan watts in the early 1970s he was talking with some politicians who were absolutely convinced money is real finally i said the trouble with you gentlemen is you still think money is real and they looked at me and sort of said oh someone who doesn't think money is real because every now anybody knows money is money and it's very important but uh it just isn't real at all because it has the same relationship to real wealth that is to say to actual goods and services that words have to meaning that words have to the physical world and as words are not the physical world money is not wealth it only is an accounting of available energy economic energy so again money is not wealth it's just really a big integer in a row locked sql database someplace owned by a bank sitting in a server farm somewhere in the world as paul graham says don't get hung up by the money it only represents wealth if you're focused on the money you're gonna get stuck as a cog in the machine you'll end up focused on that next promotion or the trappings of upward mobility what is far more valuable is to create and own that engine not just be a small piece in it [Music] now that the money myth is dispelled let's get into how to create wealth the answer is skills and people get hung up here and try hard to look like they have skills instead of actually having it pg goes on to say the people most likely to grasp that wealth can be created are the ones who are good at making things the crafts people who can create it being an engineer designer or product person is the easiest way to be a craftsperson in modern society these are the next generation construction workers of our era and just frankly the future these are the roles that are the closest to the actual creation of the product when i first started working i was really excited to get a job i remember when i was growing up our family didn't have a lot of money and at times i know my parents were really worried about putting food on the table and barely making rent sometimes dinner was just a slice of bread dipped in milk that was it so at 14 i actually started cold calling because i wanted to help my parents and our family i cold-called the yellow pages in the internet section this is me in 1995 i got my first job at the age of 14. it set me on the path that i'm on now design coding and product management marketing branding i learned to build my craft that's a really big thing that you and i have to talk about not all skills are valued at the same price dennis rodman started his first job as a janitor at an airport at the age of 18. now janitors are really important and needed but there are a lot of people who can do that job so while there's plenty of demand there's also a lot of supply because it doesn't require specialized skills to do it rodman was lucky he had a huge growth spurt and gave basketball a chance in college and in return basketball gave him a chance he ended up being drafted 27th overall in the nba draft by the detroit pistons and he ended up becoming a hall of fame basketball player how rodman developed a skill nobody else had rebounding at an extreme level shoot the ball i just shoot it over here shoot over here shoot over there should i just sit there and react react i just practice a lot about the angle of the ball and the trajectory of it you got the larry bird it's going to spin you got to the magic and maybe spin when michael shoot over here i position myself right there now i hit the rim it's going uh click and go back this way over here here click and go that way boom that way click here and go like this way so basically i just started learning how to put myself in a position to get the ball he did something nobody else did or even knew that they should do and that won his team's five nba championships five rings he made himself extremely valuable remember not all skills are valued at the same price if you can do things nobody else can do you'll have skills that are literally priceless and to be frank this is one of the more brutal facts of capitalism venkatesh rao says that you can either live above the api or below the api api stands for application protocol interface it's how programs talk to each other and now it's programs that are governing all aspects of how humans transact business and operate with one another as a driver for uber you end up having to follow the directions of the app which means you have to work below the api it's useful to society but because there are a lot of other people who can drive too you aren't using special skills if you create uber and own it you're above the api and you get to build and maintain the systems that give people what they want so what is most useful is actually acquiring skills that nobody else has especially in combinations that are rare if you can rebound the ball and nobody else does it quite the way you can you can be a hall of fame basketball player and that applies to all the things in your career and in life i get approached by a lot of people who want to raise money for their startup but you have to know investors are looking for founders who actually have the skills necessary to build that dream why it's really straightforward if i give money to a founder who doesn't have the skills they're going to lose against the people who have the real skills so that's why it's so important for people to work on those skills before they raise money before they start on their startup and this is also why good investors look at the skills of the founders and the teams they fund not just the credentials i hate to say it but there are definitely people who graduated from stanford who are not good engineers sorry to say and investors get tricked like that all the time they lose money when they only look at the credentials in the resume when they can't tell if someone is actually good all of these things point to the same place the best way to look like a good startup is to actually be a good startup it's actually better to be able to build and have the skills of the crafts person and a manager than to look like one the next big principle is that you have to transcend your constraints as a limited human being most importantly this means getting leverage on your time apple computer started almost by accident here's steve jobs talking about how apple started and there was no personal computer in 1975 it's it's very hard to believe well that's why we made one we made one because we wanted one and we we there there wasn't one so we had to make one did you know that when you made the personal computer though that this will become a major industry i mean did you know like this no no it took about a year before we started to sense that i had a partner named steve wozniak who's a brilliant guy and he did most of the engineering on the original apple one in the apple ii and after about a year we showed it to our we just made it for ourselves and uh and we showed it to our friends and they all wanted one and so we were busy making these computers by hand for our friends and we it was taking all of our life all of our spare time and so we decided we better manufacture 100 of these to get you know so that we can not have to spend the rest of our lives making them for our friends and that's how we got into this we didn't think about starting a company we were just doing it for ourselves and then our friends and then the circle got bigger and bigger and bigger now there's 25 million people they were making computers for their friends and then it took more and more time to create them so they looked to create a company to save time which brings me to this point naval ravikant says wealth is about positive sum games and that's about getting out of the sort of finite games like selling your time when i got my first job cold calling the yellow pages i was happy getting paid seven dollars per hour then ten dollars then twenty dollars an hour to write code but what i wish i knew earlier was that i have a really finite number of hours in the day and in my life you can get to 60 or 70 hours per week of work but beyond that you run out but if you make a product that can make money for you while you sleep that's leverage i remember in my microsoft days i got into a cycle where my employer microsoft was buying my time and working there was tiring it didn't feel fulfilling the way i wanted it to but i got this money and i turn around and i'd consume i'd go buy a new shirt at banana republic or a nice martini at the martini bar down the street from my nice apartment downtown i paid a lot of money to make myself feel better i was stuck in a consumptive mode someone was buying my time and i was using the money that i got from that to buy things i didn't need that in some way made me feel like something was happening but in reality i wasn't feeding my soul i wasn't creating so that's what i have to tell you you can be a creator instead of a consumer most people are looking to mainly just make themselves happy by fulfilling various perceived wants that they think they have but to be truly fulfilled i now realize you have to generate and create the path to wealth is through making others happy make products find leverage and solve their problems i want you to visualize this as a concept a wealth machine you put money in and you turn the crank that machine spits out more money than what you started with and a machine like that is incredibly valuable because you can take the money that comes out and feed it back in you can reinvest that money to create wealth that's a wealth engine a wealth machine is different because it provides both money and wealth now this is in contrast to a get rich quick scheme which provides you money but no way to get more there's no wealth these are one-time things remember lambos can be bought with money but they can't actually be converted into even more money it's money without wealth if you have a business transaction that's a one-time thing that you can't repeat that's money without wealth there's also live action role play people who play startup and that's when you can't make any money and you can't have any wealth these are a waste of time usually what happens is you hire a bunch of people you spend a bunch of money and it's all a waste investments are supposed to pay back wasting money by definition doesn't pay you anything back and a special form of this is when startups decide to sell twenty dollar bills for ten dollars or even give them away for free you gotta be careful of those a truly great startup has both money and wealth money goes in it can be reinvested and you get back not just more money but also more of the thing that makes the money that's wealth you can couple this capital virtuous cycle with two others talent and customers the more talented your team is the more likely more talented people will come to work with you and when customers and users love you they tell everyone else who could possibly use you that they should and that's another virtuous cycle more customers and then all of that together allows you to raise more money to put that back into the machine that's what product market fit is and that's the key to this whole startup thing three virtuous cycles working all together talent customers and capital don't focus on the money focus on the wealth the thing that people want the problem and the solution and sometimes people come to me and say i want to start a company and i say why they say oh i want to make lots of money i said forget it that's not a good enough reason most people that have started companies because they want to make lots of money i haven't seen very many of those succeed the ones that succeed are people that come sometimes they don't even want to start a company they just have an idea that they want to get out express out into the world and oftentimes they have to start a company because nobody else will listen to them so that's it thanks for watching all the way to the end as usual i'm so glad you found me and i want you to know if you're learning about this you're doing the best favor for yourself and the world the world needs more people who are solving problems and i think you can do it for more resources please click subscribe and hit the bell icon every week i try to put together a video to teach you how to build a business and yes maybe even a fast-growing startup that touches a billion people i'll see you next week [Music] [Music] you