24.01.07 - The Anthology of Balaji

	A	B	C	D
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2		The Anthology of Balaji
3		By Eric Jorgenson
4		----------------------------------------------
5		Amazon: Link
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7		#	Pg.	TC Highlight
8		1	95	I built this book entirely out of transcripts, tweets, and talks Balaji has shared.
9		2	131	Because while I’ve had reasonable success as a founder and investor, there are certainly people who are better company founders (like my friend Brian Armstrong, founder of Coinbase) and people who are much more focused on being great investors (like my friend Naval Ravikant, founder of AngelList). I can give advice on how to build and invest in billion dollar companies, and you’ll find some of that in this book…but there are people who are even better. Similarly, I’m a good engineer (but Vitalik Buterin is better), a respectable scientist (but Vijay Pande is better), a decent turnaround CEO (but Ben Horowitz is better), a bestselling author (but Tim Ferriss is better), and so on. I sit at the intersection of many existing categories—founder, investor, engineer, scientist, CEO, tech executive, content creator, author, etc.—without really considering myself defined by any of them.
10	X	3	271	Every few years, I feel like my life starts anew. I’m in my forties now, but I feel like I’ve just started because I built up various resources like distribution, network, and capital. Now I can broadcast ideas, invest money, and see big things happen.
11		4	328	Some people believe value comes directly from labor. They price something based on the number of labor hours that went into it. If it takes five hours of a surgeon’s time to do some procedure, it will be really expensive. If it takes one hour, then it is cheaper. At first that seems reasonable, except people pay for the value provided to them. They pay for the impact on them, not the cost to provide it. It might take a lot of time for you to handcraft one chair, but a chair manufactured on an assembly line may be cheaper and better. Even though the first chair might have more labor going into it, the second chair may cost less and have higher quality. Rather than the “labor theory of value,” I think about the “technology theory of value.” The actual value injection is from technology. Think about using a light bulb rather than having humans running around with you holding candles. It’s the same for refrigerators and automobiles.
12		5	405	Often, technological breakthroughs are presented in movies as an Icarus-style story, with an old, outdated moral: “Oh, they were so arrogant with their technology. They flew too close to the sun, and their wings melted, and they fell back to the earth. They should not have been so arrogant as to think they could aim so high.” That’s the implication of Jurassic Park, The Terminator, and Black Mirror. All the bad things that happen are about the hubris of the scientists and blah, blah, blah. The movie Limitless is about a guy who finds a wonder drug that unlocks the use of our fullest intelligence. There are side effects, but the movie is so refreshing because, at the end, the guy works out the bugs. With his super intelligence, he’s able to figure out the better version of the pill. That’s how it works in real life. We aren’t like Icarus. We had some crashes, but we figured out how to have safe, reliable planes stay up in the sky. We engineered the failures away. We figured out a way around the seemingly un-figure-out-able. Believing the next problem is solvable is a fundamental tenet of the philosophy of technology.
13		6	554	Decentralization doesn’t mean an absence of leadership. It means a choice of many leaders. Crypto has allowed millions of people to partially exit their existing financial and political systems for large-scale experiments in self-governance and self-determination…even if not all of them have realized this yet. Decentralization restores the consent of the governed.
14	X	7	579	Everything technology is doing means more upside, more downside. That’s my one-liner for the future: more upside, more downside.
15		8	733	An interesting movie called Surrogates explores what a really big drone/telepresence future would look like. In the movie, people never leave their homes. Instead, they just connect into a really good-looking drone/telepresent version of themselves and walk around in that. If they’re hit by cars, it doesn’t matter because they can just create new drones and rejuvenate. The impact of drones is very, very underrated.
16		9	861	Humans have been living with technology in this way forever. Fire arguably made us human. Richard Wrangham’s book Catching Fire describes how the invention of fire allowed humans to outsource some of our metabolism to the fire and allocate more scarce calories for brain development. This relaxed an evolutionary constraint, which made us smarter and more human. We’ve been coevolving with technology for a very, very long time, throughout evolutionary timescales. Technology is actually what makes us human. It’s what distinguishes man from animal.
17	X	10	879	You’re pursuing truth, health, and wealth, in that order. That’s actually the right priority order. For example, you’d never want to do something that’s untrue to make money or sacrifice your long-term health for wealth. Learn to determine what is true. Pursue health because, without that, you have really nothing else. Then wealth is important, but it’s third—though it’s important to have that third.
18	X	11	942	I admire Ramanujan. I admire Feynman. These great mathematicians and physicists were able to see things others couldn’t. Just by writing down what they observed, they created a huge leap forward.
19		12	963	Technological history is the history of what works; political history is the history of what works to retain power.
20	X	13	1196	You must build your own distribution to avoid distortion.
21		14	1286	Every day, first thing, most people get a blend of randomness all at once. In this high-dimensional space, you’re being pulled in a bunch of different directions, not really making progress. Progress is doing some math today and doing some more math in the same area tomorrow. A little bit of compounding progress along the same direction each day adds up to something, but time spent on these sites add up to nothing. I’m not saying they have zero value; there’s some value to serendipity. You do learn the pulse of what a community is thinking. But I think we are overconsuming novelty and underconsuming purpose. What’s the good stuff? It is what helps you boost the measurable variables you care about. It’s increasing your truth, health, and wealth. It’s your knowledge, your physical fitness, your bank account balance, or some combination of them.
22	X	15	1541	As a guiding philosophy, “win and help win” will always outcompete “live and let live.”
23	X	16	1579	Wealth creation is the technological creation of order. It is the difference between a bunch of bricks lying on the ground and a house; the difference between a bunch of pieces of wood lying on the ground and a chair. You can see those differences in physical space. When people are confused about wealth creation in a physical example, they say, “You must have gotten the bricks from somebody. You must have gotten the wood from somebody.” Most of the value, though, is in the ordering of those materials. Often the value of raw materials is not anywhere near the value of the assembly process: the know-how, the machines, and the effort required to put the raw materials together.
24	X	17	1587	The less money you need, the less dependent you are.
25		18	1588	When you’re in any institution, you cannot speak freely, especially when you’re the CEO. I’ve only really been able to speak freely to a greater extent over the last year and a half. After my first big liquidity event, I had around ten years of personal runway (the number of years one can go without working). That’s when I became kind of invincible, in a sense. Saving money and separating from organizations made me intellectually independent. It was like giving myself tenure. I don’t buy cars or homes. After I earned a big payout, whenever I could save time with money, I did. That’s the single biggest change I have made. I spend my money on being able to work harder. It sounds funny, but it’s true. I’m not a consumption person; I’m a production person. I’m not burning capital on stuff. Everything is going into the next compounding outcome—not just compounding money, though money is an important tool. Knowledge compounds on other knowledge. Impact, same thing.
26	X	19	1598	Reducing your cost of living to ⅕x is way easier than increasing your net worth by 5x. If you’re willing, you can move to the middle of nowhere and cut your expenditures. You can just read Kindle and live on simple, healthy foods. You can basically reduce your consumption to the level of a grad student.
27		20	1690	The hard way to gain status is to build something, to accomplish something, to add value. The easy way to gain status is to accuse someone else of being a bad person. It’s a status-acquisition hack, a quick way to gain relative status. Your critique of the existing system may be correct. But you need a product, not just a critique.
28		21	1721	The really cynical person and the really docile person have one thing in common: they never make bold moves.
29	X	22	1723	Every startup and every project starts as a hallucination. At the beginning, the idea is a word on a napkin. It doesn’t mean anything. You have to believe it can become much bigger than it is. Always, at every stage, you have to believe it is bigger than it is.
30		23	1739	The state has far more money than anyone else. But NASA is behind SpaceX because tech isn’t capital-limited; it’s competence-limited.
31		24	1755	The correct title for Musk, Chesky, Thiel, and other people who created wealth is “founder.” The correct title for East Coast scions of inherited wealth is “nepotist.” Simply describing people by their net worths ignores whether they created wealth. “Billionaires” do not exist as one category.
32		25	1808	Searching out your own path is deeply underemphasized. Don’t just look at TechCrunch or Twitter. Some people are successful because they look at competitors and align around the competition. They are just fast followers. It is very hard to Twitter or TechCrunch your way to real innovation. To innovate, you have to tune out a lot of what the Valley is thinking. I can’t imagine Satoshi got the idea for Bitcoin by reading TechCrunch. It was a completely out-of-left-field idea with no previous validation in the tech mainstream.
33		26	1827	Carlota Perez describes her whole theory about why this happens in her book Technological Revolutions and Financial Capital.
34		27	2075	What I prefer is a tiny team of well-rounded athletes, employees who are smart, hard working, and work well together. Then there are no politics because everybody was selected for alignment. Finding up-and-coming people is a very important component of hiring. Technology executive and investor Keith Rabois has a good saying: “Hire geniuses no one knows yet.” My version is: “Hire people who are hungry and can teach us something.”
35		28	2156	Before candidates join your company, have them write out what they would consider success, mediocrity, and failure: bull, base, and bear. Where do they want to be in a year or four years? This is a useful thing for you and massive for them. What would be good, what would be amazing, and what would be a failure in four years? By considering that, they take more responsibility for their own paths. And they’ll have fun looking back on their answers four years later. They’ll be able to see, “Wow, I was so awful on these predictions, and I was correct on these!”
36		29	2178	Distribution is about connections. Anyone can get commodity distribution (by paying for Google ads or Facebook ads). The art is to find some distribution arbitrage in your time and place. Find an inexpensive customer acquisition channel and pile up users through an underpriced angle others haven’t realized yet.
37	X	30	2232	As a general rule, if someone can steal your idea by simply hearing it, you don’t have something defensible. Compare “I have an idea for a social network for pet owners” to “I’ve developed a low-cost way to launch objects into space.”
38		31	2250	A startup is willing something into existence. Elon has a saying about startups: “It’s like chewing broken glass and staring into the abyss.” The reason is there’s no place to hide. You cannot blame somebody else. You just have to figure it out. There is no safety net. Your company could die, everything could go to zero, and you could be humiliated in public by the haters. (Haters actually just hate themselves, though. They are rooting for somebody else’s failure because they don’t have the courage to try themselves. They can no longer make calculated bets because, to protect their egos, they’ve convinced themselves everything is going to fail.)
39		32	2271	Mark Zuckerburg also said something like this: “When you feel boxed in, if you’re smart enough, there’s usually a move.” Technology is multi-dimensional enough that there is usually a move available. If you’re smart enough and dedicated enough, you can find it.
40		33	2290	Economist and philosopher John Maynard Keynes said, “Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist.” Meaning, if you don’t know what intellectual software you’re running, you’re running something subconsciously.
41		34	2326	What you choose to load into your brain first thing in the morning is the most precious, precious space. Perhaps your first few hours should be offline with pen and paper, writing things out. Some offline time is good, so you don’t just immediately jack into the internet.
42	X	35	2427	For those who aren’t good at engineering—well, get good at content. Content is as important as engineering nowadays. Every new company could have a founding influencer on par with the founding engineer. Today, a founding engineer and a founding influencer are building a company. Tomorrow, a founding influencer and a founding engineer may be building a country.
43	X	36	2438	A founder’s diligence is harder to determine than intelligence.
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