Chamath Palihapitiya: The #1 Secret to Becoming Rich

Slow and steady against hard problems. Start by turning off your social apps and giving your brain a break because then you will at least be a little bit more motivated to not be motivated by what everybody else [__] thinks about you.

I saw some of the venture world at South Bank, some of the tech world, and you said something about amassing capital today. What do you think is one of the best ways for us to amass capital on a risk-adjusted basis? I mean, the last part is just such a sell-out—a risk-adjusted base. I don’t [__] buy some buns. I mean, I don't know. [Laughter]

Here's what I would tell you, man. I think if you ask me who’s building the most important indelible company in the world, I've been very public about this: I think it's Jeff Bezos. Part of what he realized was the value of slow compounding.

So here's my little theory about company value creation: the faster you build it, that is the half-life, it will get destroyed in the same amount of time. When you think about a lot of like social businesses, that's played out. And when you see sort of like what the—sort of like the top—so like, you know, does it take eight, nine, ten years to build a really great consumer business? It'll take eight, nine, ten, twelve years to destroy it.

Um, and we may see the tipping point a couple of these businesses right now; we may be seeing it in front of our eyes, regulatory, otherwise. So why is that an important statement? Amassing capital to me is about finding a smart, useful solution to a very hard practical problem and being slow and methodical.

And again, that’s what I’m saying: you have to rewire your brain for that to be okay. How do you in year two or year five come back to this room for your—what is it called when they—you get reunion—and say I’m still working on the same thing? And when somebody says, “And how’s it going?” you have the courage to say, “It's hard. I haven't figured it out yet. I don’t know.”

But if you figure it out and you have this moderate growth, moderate compounding, that is the key. That is like—that's gold, you know? I look at like our returns and it's so funny because it's like you can get so enthralled by IRRs in our business. And like, you know, I have friends who run other organizations and they're like, “Uh, we posted 92 IRR,” and I’m like, “Well, you can't eat IRR. What does it really mean?”

And when you unpack it, what you realize is like fast money returns can completely really decay long-term thinking and sound judgment. And so I'm like, wow, I would really love to just compound at 15 a year, and the reason is because if I can do that for 50 years, that's 250 [__] billion dollars. Like some crazy number! Like it's just enormous.

So it's like slow and steady against hard problems. Start by turning off your social apps and giving your brain a break because then you will at least be a little bit more motivated to not be motivated by what everybody else [__] thinks about you.

Do you know what I’m saying? It’s hard. Think about how all this stuff plays together. How does trying to get, you know, uh, posting your [__] waffles online relate to me starting a business and accumulating capital? This is wiring your brain for super-fast feedback. It's the same brain you're using to build a company. Don’t think they’re not the same. Do you know what I’m saying? No? Yes? No? Yes? Yes.

Right? You have one brain. So you're training your brain here, whether you think it or not, whether you know it or not, whether you acknowledge it or not. Acknowledge that these things where you're spending hours a day are rewiring your psychology and physiology in a way that now you have to use to go and figure out how to be productive in the commercial world.

So if you don't change this, you are going to get the same behaviors over here. Change this! There’s a reason why Steve Jobs was like anti-social media. I am telling you, I'm not on these [__] apps. I'm not him by any stretch of the imagination, but I am proactively trying to rewire my brain chemistry to not be short-term focused. I'm telling you, they're linked.