The Almanack of Naval Ravikant

Eric Jorgenson · 2020

Thesis

Wealth comes not from renting out your time but from owning assets and applying knowledge that only you have, multiplied by leverage such as code, media and capital and backed by your own accountability, while happiness is not a reward for success but a skill that can be learned, largely by wanting less.

The main ideas

Seek wealth, assets that earn while you sleep, rather than money or status.
Build specific knowledge: skills that come from your own interests and cannot easily be taught or replaced.
Use leverage. Code and media let one person's work reach millions without anyone's permission.
Take accountability for your work under your own name.
Judgment matters more than effort once leverage multiplies the effects of every decision.
Play long-term games with people you trust, since returns compound over time.
Happiness is a skill and a choice. Each desire is a source of unhappiness until it is met.

How to get rich

Naval Ravikant is an entrepreneur and investor, a co-founder of the review site Epinions and of AngelList, a platform for startup investing. He never wrote a book. In May 2018 he posted a long thread on Twitter titled "How to Get Rich (without getting lucky)," which spread widely, and he expanded on it in podcasts and interviews.

Eric Jorgenson, a product strategist and writer, compiled Ravikant's tweets, podcasts, essays and interviews from about a decade into The Almanack of Naval Ravikant, published in 2020 with a foreword by Tim Ferriss. The book was released free online as well as in print and has sold more than a million copies. Jorgenson says it is not a how-to book but a collection of Ravikant's thinking, arranged in two parts: wealth and happiness.

Implication: read it as a collection of principles to test against your own experience, not as a step-by-step plan.

Wealth, not money or status

The thread's first line is "Seek wealth, not money or status." Ravikant distinguishes the three. Wealth is assets that earn while you sleep: businesses, equity, products, intellectual property. Money is the means by which we transfer time and wealth. Status is a person's place in a social hierarchy.

The distinction matters because the games differ. Creating wealth is a positive-sum game: one person's new business or product does not take anything from anyone else. Status is zero-sum, because one person can rise in a ranking only if another falls. Ravikant argues that people who play status games become worse at creating wealth.

He also argues that no one gets rich by renting out their time, since time cannot be multiplied. Wealth requires owning part of something that can earn without your direct effort.

Implication: aim to own equity in something, whether a business or your own product, rather than relying only on a wage for your hours.

Specific knowledge

Ravikant's term for what a person should build is specific knowledge: knowledge that cannot easily be taught in a course or replaced by someone else, because it grows from a person's own curiosity, temperament and experience.

Such knowledge, he argues, is found by pursuing what you are genuinely curious about, often things that feel like play to you but look like work to others. If society can train someone to do a job, it can train someone else to do it more cheaply, and eventually a machine to do it.

The mechanism is that knowledge rooted in your particular interests and abilities is scarce, and scarcity is what the market pays for.

Implication: look for the work that comes naturally to you but seems hard to others, and build skills there.

Leverage and accountability

Ravikant identifies forms of leverage that multiply the results of a person's work: labor, meaning other people working for you; capital, meaning money; and the newest, code and media. Labor and capital require someone's permission, an employer, investor or partner. "Code and media are permissionless leverage." A person can write software or publish writing, audio or video that works for them while they sleep, reaching millions at almost no extra cost.

Leverage is paired with accountability. "Embrace accountability, and take business risks under your own name." Taking public responsibility for outcomes means risking blame for failure, but it also earns credit for success, and over time it builds a reputation that attracts the trust and resources needed for more leverage.

The mechanism is that leverage multiplies the effect of each decision, and accountability earns the trust that grants access to leverage.

Implication: build something, in code or media, that can work without your hourly presence, and put your name on it.

Judgment and long-term games

With leverage, Ravikant argues, judgment matters more than effort. When a single decision can be multiplied across millions of people or dollars, being right matters far more than working long hours.

He recommends building judgment through reading widely and thinking clearly about one's own experience. "Read what you love until you love to read," he advises.

He also stresses time. The great returns in life, in wealth, relationships and knowledge, come from compounding, so it pays to play long-term games with long-term people: to choose partners carefully and stay with them.

Implication: invest in your ability to make good decisions, and choose people to work with whom you would want to work with for decades.

Happiness as a skill

The second part of the book turns from wealth to happiness. Ravikant treats happiness not as something that arrives when circumstances improve but as a skill that can be developed and a choice that can be made.

He describes desire as a contract a person makes with themselves to be unhappy until they get what they want. Every desire, in this view, is a source of dissatisfaction, so the fewer desires one holds, the more peace one has. He recommends choosing one desire at a time carefully, rather than living in a constant state of wanting.

He discusses meditation and other practices for quieting the mind and attending to the present moment.

The mechanism is that happiness depends less on what one has than on the gap between what one has and what one wants, and that gap can be closed from either side.

Implication: before pursuing a new goal, notice the dissatisfaction you are agreeing to until you reach it, and decide whether it is worth the price.

Limits

It is a collection of fragments. Assembled from tweets and conversations, it states principles without the evidence or argument that would test them, and its ideas repeat and connect loosely.
Its advice comes from an unusually successful investor. Lessons drawn from one winner's path in Silicon Valley may underweight the role of luck and starting position, despite the thread's promise of getting rich without luck.
Its leverage is unevenly available. Code and media are permissionless in principle, but they reward those with technical skills, time and an audience, and many fields remain controlled by licenses, institutions and capital.

Zero to One — another Silicon Valley investor's case for building something new and owning it.
Poor Charlie’s Almanack — an earlier collection of an investor's principles on judgment and wealth.
The Power of Now — the case for peace through attention to the present moment.