Product and Media Are New Leverage

The most interesting and the most important form of leverage is this idea of products that have no marginal cost of replication. This is the new form of leverage. This was only invented in the last few hundred years. It got started with the printing press and accelerated broadcast media, and now it's really blown up with the internet and with code.

So now you can multiply your efforts without having to involve other humans and without needing money from other humans. This podcast is a form of leverage. Long ago, I would have had to sit in a lecture hall and lecture each of you personally, and I would have maybe reached a few hundred people, and that would have been that.

Thirty years ago, I would have to be lucky to get on TV, which is somebody else's leverage. They would have distorted the message, that would have taken the economics out of it or charged me for it. They would have muddled the message and I would have been lucky to get that form of leverage.

But today, thanks to the internet, I can buy a cheap microphone, hook it up to a laptop or an iPad, and there you are, all listening. So this newest form of leverage is where all the new fortunes were made. All the new billionaires, the last generation fortunes, were made by capital; that was a Warren Buffett's of the world.

But the new generation fortunes are all made through code or media. Joe Rogan making 50 to 100 million bucks a year from his podcast. PewDiePie, I don't know how much money he's rolling in, but he's bigger than the news, right? The Fortnite players, of course. Jeff Bezos and Mark Zuckerberg and Larry Page and Sergey Brin and Bill Gates and Steve Jobs - that is all code based leverage.

Now the beauty is when you combine all of these three, that's where tech startups really excel, where you take just the minimum but highest output labor that you can get, which are engineers and designers, product developers, and then you add in capital, use that for marketing, advertising, scaling, and you add in lots of code and media and podcasts and content to get it all out there.

That is a magic combination, and that's why you see technology startups explode out of nowhere, use massive leverage, and just make huge outside returns. If you want to talk a little bit about permissioned versus permissionless, probably the most interesting thing to keep in mind about the new forms of leverage is their permission.

They don't require somebody else's permission for you to use them or succeed. For labor leverage, somebody has to decide to follow you. For capital leverage, somebody has to give you money to invest or to turn into a product. But coding, writing books, recording podcasts, tweeting, YouTubing - these kinds of things, these are permissionless.

You don't need anyone's permission to do that, and that's why they're very egalitarian. They're great equalizers of leverage. And as much as particular may rail on Facebook and YouTube, they're not gonna stop using it because this permissionless leverage, where everyone can be a broadcaster, is just too good.

The same way, you know you can rail up on Apple for having a slightly closed ecosystem in the iPhone, but everyone's writing apps for it. And so as long as you can write apps for it, you can get rich or reach users doing that. Why not?

I think of all the forms of leverage, the best one in modern society - and people that have this glib, this is a little overused, but this is why I tell people to learn to code. Right? It's that we have this idea that in the future there are gonna be these robots, and they're gonna be doing everything, and that may be true.

But I would say the majority, the robot revolution, has already happened. The robots are already here, and there are way more robots than there are humans. It's just that we packed them in data centers for heat and efficiency reasons. We put them in servers; they're inside the computers, all the circuits.

It's a robot mind inside that's doing all the work. And so every great software developer, for example, now has an army of robots working for him at nighttime while he or she sleeps, after they've written the code, and it's just cranking away. So the robots' army is already...