This book was published in 2015 and is for those who want to create more money, freedom, and meaning in life while improving the lives of those you love. These are my notes from the book which may or may not be of interest. If you do like what you see here, then I’d encourage you to buy the book so you can draw your own conclusions. Enjoy!
- Have We Reached The End of Jobs?
- Lessons on Globalization From An Evil Genius
- The Acceleration of Technology
- The Commoditization of Credentialism
- Why Are We At The End of Jobs?
- The Entrepreneurial Economy
- Entrepreneurship Is Safer Than Ever
- Thriving in Extremistan
- The Long Tail
- The Democratization Of The Tools Of Production
- The Democratization Of Distribution
- The Stair Step Method
- The Return of Apprenticeships
- Entrepreneurship Is More Profitable Than Ever
- More Money
- More Freedom
- More Meaning
Have We Reached The End of Jobs?
One of Steve Jobs' many key insights:
Everything around you that you call life was made up by people that were no smarter than you and you can change it, you can influence it, you can build your own things that other people can use. Once you learn that, you’ll never be the same again.
On the difference between entrepreneurship and a job:
Entrepreneurship is connecting, creating, and inventing systems — be they businesses, people, ideas, or processes.
A job is the act of following the operating system someone else created.
On the difference between the past and present situation with jobs:
According to a 2015 report from Kleiner Perkins Caufield & Byers based on data from the US Census Bureau, from 1948–2000, jobs grew 1.7× faster than population. Since 2000, the population has grown 2.4× faster than jobs.
This means we have reached peak jobs and approaching the end of jobs entirely. There are a few reasons for this:
The sharp rise in global communication means anyone anywhere in the world can work for any company.
Automation via hardware and software has taken over blue collar jobs but is also taking over white collar jobs (knowledge work) too.
College degrees are abundant and less valuable than ever.
Lessons on Globalization From An Evil Genius
2001 — the dotcom bubble — is when a lot of white collar jobs started being outsourced and it’s been increasing ever since.
Frederick Winslow Taylor, the father of management, took years to articulate improvements to the workforce — using the scientific method to measure and apply insight — where rapidly growing countries like China, India, etc. were able to bootstrap and bypass all of that work by simply reading a book on Taylor’s learnings. The lesson is that is takes a long time to formulate new ideas whereas very little time is required to read, learn, and gain established knowledge. Same is true when it comes to global communication.
Knowing the above — and with caution to not let any power gained go to your head — the following is the right way to wield the leverage you build:
The best way to improve conditions is for individuals with a strong moral compass to acquire power and build better systems.
The Acceleration of Technology
Examples of exponential growth:
Paypal instead of mailing/wiring money.
Amazon instead of Borders.
Netflix instead of Blockbuster.
Apple Music instead of record stores.
The downside of being human is that we evolved to think linearly but completely fail to think exponentially. Knowing this means you need work at thinking more in the latter mindset.
The Commoditization of Credentialism
A degree isn’t as valuable anymore due to saturation and so many people being highly educated. Same goes for following directions and implementing best practices (blindly, that is). What is required now, is the ability to operate in complex and chaotic systems (a.k.a. entrepreneurship).
Interestingly, what isn’t explained very well in the book is sidelining best practices or even the knowledge of good design in general. Blindly following rote instruction is definitely not encouraged but the lumping of not knowing best practices and antipatterns should not be so easily dismissed because if you don’t know what they are then you don’t know how to bend them in new and interesting ways.
Why Are We At The End of Jobs?
In the book The Fourth Economy by Ron Davison, he organizes recent history into the following economic periods:
The era where wealth came from the ownership of land and making a profit off of the resources extracted. This came about by:
Shifting from religious authority (Pope) to land (Nation States).
Nation States owning the land so the power of the church diminished.
Power shifting from the Pope (single person) to a small group of individuals (kings). Henry VIII of England was instrumental in this.
Power shifted again but this time from Nation States (kings) to Banks (bankers).
Land was no longer a scarce commodity but, instead, capital was.
An example is when Nathan Rothschild (banker) loaned money to Prussian King Friedrich Wilhelm III in order to combat Napoleon but only on the condition that the King would establish a parliamentary government in order to ensure a return on investment since Parliaments are more reliable than monarchs.
Power shifted from capital (banks/bankers) to knowledge (corporations/CEOs).
Power shifted from knowledge to entrepreneurship.
The individual (entrepreneur), not the corporation (CEO), is now in control.
The above is an oversimplification but does provide an interesting categorization to the evolution of work and the era we are in now.
The Entrepreneurial Economy
Globalization means you are competing against everyone in the world instead of someone in your your city. Knowledge is no longer enough, especially considering the number of college graduates has gone from 90,000,000 to 130,000,000, globally, between 2000 - 2010 and continues to rise.
There is no accurate measure of entrepreneurship but you can think of it as a series of steps (first = lowest, last = highest):
40%: Employee with side hustle
100%: Founder (experienced)
Since access to knowledge is more abundant than ever — including the availability of cheap technology and global communication — jobs have become more competitive and less profitable. While this is bad for knowledge workers, it is great for entrepreneurs because you can now:
Create a business, like an LLC, for $50 or less (depending on the state).
Cheaply build much of your infrastructure in the cloud without taking on massive debt.
Quickly build a product/service that generates reoccurring revenue.
Entrepreneurship Is Safer Than Ever
Negative visualization — a term borrowed from Stoicism — is when you imagine the worst outcome in order to help make difficult decisions. A few examples:
Asking someone you are fond of on a date. You might be rejected — which will hurt emotionally — but there is little risk in trying.
Flipping a coin where heads wins $150 and tails loses $100, you’d come out ahead — statistically speaking — if tossed 100 times.
All of this is to say that the perceived negative effect pails to the potential gain.
Thriving in Extremistan
Extremistan is living in the Pareto distribution of an 80/20 curve where 20% of individuals are in the highest part of the curve while those in Mediocristan are living in the Bell curve where 10% are failing, 80% is the average majority, and 10% are the top elite.
Life in this Extremistan is sudden, often violent, and mostly unforeseen because technology and globalization continues to rise as the middle class continues to die.
In this new world, you don’t want to be mislead into remaining a turkey because, right up to the point of death (i.e. Thanksgiving Day), you are led to believe:
You are born in a safe and protected environment.
There is plenty of food and you are cared for on a daily basis.
Each day reinforces the next in assuming life will continue to get better and better.
Only until the day before Thanksgiving do you realize the fatal error and misunderstanding of your circumstances because all calculations were only based on past evidence.
The longer the market goes without having a correction, the larger the correction will be when it happens. The longer we go in our careers and businesses without variation or randomness, the larger the amount of underlying risk we accumulate.
You can lead a mediocre life where you go to work, collect a pay check for 10 years, and then end up being fired because technology or new talent replaced you. What you didn’t see during this time — much like the turkey — is all of the hidden risk the company absorbed that you weren’t privy too. On the other hand, you could live an extreme life where you take on all risk of starting a business by knowing all of what’s in front of you. Each day you don’t make money, or make less money, is new information learned so you can pivot or stay the course. Slowly, you’ll build strength with getting comfortable in dealing with risk and uncertainty which makes you more adaptable than those who are too rigid and stuck in the past.
The Long Tail
What’s making entrepreneurship more accessible is through the democratization of:
Production: It is cheaper than ever to build a product or service from anywhere in the world with little to no upfront cost or debt incurred using open source tooling and/or cloud infrastructure.
Distribution: It is now easier than ever to reach markets of interest through podcasting, screencasting, syndicated feeds, and so forth.
Markets: There is a multitude of niches within all markets and more and more are spinning up and branching out every day. You don’t have to even conquer the market but specialize in only a few niches instead.
💡 A book that might be worth checking out is The 7 Day Startup by Dan Norris.
The Democratization Of The Tools Of Production
A few examples:
AirBnB instead of hotels.
Lyft instead of taxis.
Digital Ocean instead of building your own server hardware.
In all of the cases above (except maybe Digital Ocean), existing supply was used instead of creating new supply to service others with very little investment in building infrastructure. This leads to dramatic reductions in:
Low quality (i.e. you now have access to best in class for a fraction of the price).
Stewart Brand once told Steve Wozniak that information wants to be free. The internet, plus searchability, is the answer. It’s now easier than ever to learn all that you want, freely (except time), and level up at a fraction of the cost it would take to go to college.
The Democratization Of Distribution
Products are easier to make and markets are easier to reach. Because of the internet and social media, anyone can advertise, market, and spread the word.
The Stair Step Method
Step 1: Launch a product that sells with a one-time charge with a single marketing channel like SEO, Google Adwords, a syndicated feed audience, or via Amazon. This’ll help you build experience of selling and supporting a product in a smaller space.
Step 2: Launch multiple single charge products where you learn to support and manage them with the potential aid of a virtual assistant.
Step 3: You now have time and money to stop working nights and weekends by spending 40 hours a week working on your business by launching bigger products.
Rob Walling — of Startups For The Rest of Us notoriety — started with small one-time products/services and then scaled them up through SEO, fixing bugs, and improving the overall experiences of customers. Afterwards he started focusing on his personal brand and podcasts. All of this is to say that each step of the way inched towards something greater which provided more money and time to generate more opportunities.
The Return of Apprenticeships
Many people think free work or unpaid internships are exploitative, but find the idea of someone taking out a quarter million in debt to get a college degree and an MBA a smart investment.
That may be a legacy of the knowledge economy that we haven’t adapted to yet.
There is additional value in this approach which echoes what’s been written in How To Keep Your Best Programmers by having companies abandon the outdated model of thinking you’ll hire someone for years, even decades, only to find they leave after a year or two due hitting a growth ceiling where there is no more to learn. It would be better to be more realistic by allowing talented folks to work for you at a lower price point while gaining new skills in areas they are desire while providing the skills the company needs while it grows. The company wins because it has young, hungry, and talented folks who can quickly solve immediate problems while the apprentices grow in learning tools of the trade, how the business domain works, and/or new skills knowledge to run their own company.
There is another win here which is the network effect of building relationships during this time. As the apprentices grow and become more affluent in their own skin they will be able to provide experience and wisdom to similar problems you are solving not to mention being able to bring in additional talent and firepower you couldn’t get elsewhere.
In order to make this successful, you need a standard operating procedure:
Define the processes and provide documentation for the apprentice to hit the ground running for a quick return on investment.
Use a spreadsheet with a column for the task/process, estimated time per week, and an estimate of what the value is to the company (i.e. what is the monetary value of the ROI).
Keep in mind that a high quality hire will still take three to six months to get up to speed within your business domain.
Entrepreneurship Is More Profitable Than Ever
Research collected over the past few decades comes down to three core motivators: money, freedom, and meaning.
You won’t make it by being a lackey and trying to work your way up the corporate later. A typical job limits you in terms of direction which is a severe hindrance if you want to grow your wealth and improve intrinsic value. Jobs also consume time — which is the most precious of all resources — which limits you further. As an entrepreneur, you have both time and money.
Here’s another consideration:
3% annual growth as an employee (i.e. cost of living wage).
20% annual growth as an entrepreneur.
The assets you build are more valuable than cash because as more people take interest in them, word spreads. Even better, existing and new visitors might be interested in related products or higher services which compounds further growth.
The degree to which we’re able to design our reality is directly related to our quality of life, freedom, and wealth. Those that design reality have a higher quality of all factors in their life, and through designing their reality they enable others to do the same by creating more wealth.
Edward Deci, the founder of Self-determination theory, noticed in his experiments and observations that great work emerged when individuals had more freedom, and were, in a sense, allowed to be more entrepreneurial.
With the abundance of freedom, we have more leveraging power to create bigger and better things but also the time in which to do it. Vast amounts of time and deep thought is where the greatest of ideas and inventions stem from.
Mention of Mihaly Csikszentmihalyi’s book on Flow along with the works of Edward Deci, Frederick Herzberg, and W. Edwards Deming can be summarized as follows:
When we spend our time striving and growing towards a task that we freely choose, we do better work. The same input creates more input. We have a longer lever.
It’s in the moments of searching and striving for those goals that we find flow . It’s in the entrepreneurial search for something more, for seeking and striving, that people do their best work.
This echoes what Dan Pink wrote about in Drive. It’s disappointing that Pearson doesn’t reference Drive in this section of the book directly but is only mentioned in the Notes section at the back of the book.
The biggest problem we’re dealing with today is the underutilization of individuals. The most talented and ambitious young people, when they feel under-utilized in the jobs, shrink to fit their position.
Complex entrepreneurial work is what is in short supply, and jobs where we are working as an obligation hurt our ability to do that. It’s hurting us as a society, but more importantly it’s hurting us as individuals. If we’re seeking to do our best work and to create a legacy, it’s not taking us there.
This is the era where power is moving from corporations to the individual in terms of readily available technological solutions that are cheap, powerful, and constantly enhancing at a profound rate. Carpe diem!