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Silicon Valley entrepreneurial godfather: 4 years to earn the secret of money that others can't earn in 40 years
Entrepreneurship is not to make you comfortable for 40 years.
Is working at ultimate strength for 4 years.
Entrepreneurship is a process of highly compressing the future.
01 Entrepreneurship is a process of highly compressing future time
Last weekend I read the book “Hackers & Painters” by Paul Graham, the father of Silicon Valley Ventures. Paul founded the Y Combinator incubator in 2005, he invested in more than 80 entrepreneurial projects. One of the projects he invested in, the cloud storage tool Dropbox commonly used by foreign traders.
There is a chapter in the book called “How to Make Wealth”. One of the questions is very interesting: If you want to make a fortune, what should you do? Did you smell the taste of Chinese successful masters? If you smell it, it means that your sense of smell may be wrong. Today we are not discussing the success of hacking techniques and brainwashing.
Paul's answer: You must start a business or join a startup in a new industry. Paul is an American, he is so successful, so this answer is not unexpected. I am interested in is the process of one of his reasoning, this logical system is the core, and it applies to which country.
He proposed several entrepreneurial principles.
The first principle: Entrepreneurship is a process of highly compressing the future.
What is compression, for example. The greater the degree of compression, the greater the energy you get, you can instantly obtain a high degree of concern. If an entrepreneur can't be strong in 4 years, the big probability is decadent. Entrepreneurship is not let you work comfortably for 40 years, but the work to the ultimate strength of 4 years. What is ultimate strength is the strength that damages your physical and mental health. You see successful business people are not what he is feeling a little nervous a little wrong.
The second principle of entrepreneurship: the higher the work efficiency, the higher the extra compensation.
Paul gave an example to illustrate this principle.
A good programmer earns about $100,000 a year. He brings $100,000 a year to the company to ensure that the company doesn't lose money. If the programmer is self-employed, the working time can be doubled, and if he is extremely focused, the efficiency per hour can be increased by 3 times.
By removing the company's middle management, the efficiency can be doubled. If you don't have to complete the trivial things of the BOSS showdown, but concentrate on doing what you want to do, the efficiency can be increased by a factor of three. Then your work efficiency is: multiple = 2 * 3 * 2 * 3 = 36 times.
If you work in this way, the programmer's income will reach 10 * 36 US dollars per year, close to more than 360 million US dollars, instead of 100,000 US dollars. Paul believes that this calculation may not be accurate, but the calculation of the root logic is correct, this multiple is roughly between 10-100.
This shows why successful entrepreneurship can make money, not by magic. Entrepreneurs have not changed the rules of creating wealth, but have compressed it to 3-4 years. We have learned the law of conservation of energy in junior high school: energy does not come out of thin air, nor does it disappear from the air. It only transforms from one form to another, and the total amount of energy remains the same. The law of conservation of business: If you want to earn 5 million, you have to endure the pain equivalent to 5 million yuan. To earn more, you need to endure more.
You can do high-intensity business for three years to earn, also you can do low-intensity work 40 years to earn. Additional pressure to bear, before they get additional rewards.
What is wealth? What is work?
Many people think that wealth is money. The real wealth is resources, connections, housing, cars, quality of life, health, family, travel, etc., not banknotes. Banknotes are just exchange media. These are common sense in economics, but many people don't understand.
Work is the process of creating wealth. Even if you are in the top 500 in the world, it is to work with many people to create something that people need. However, once a person enters a company with strong economic strength, such as BAT, he will think that he can create wealth for the company because he is very powerful. Ignore the most essential thing: work is to create wealth for customers, Boss is only the agent of the customer. How much wealth you want to have, how much wealth you have to create, or play an equal role in resource allocation.
You join any company, if you say to Boss: Boss, you see that I work 10 times more than others, and the boss has to give me 10 times the salary. You will be dismissed immediately, because when the boss hires you, the salary is the value of assuming that you have gone all out to work.( Finally, I know why it is so difficult to raise my salary.)
The company's problem: Measuring the value of your contribution depends largely on the boss's mood. Even if there is a mechanism called KPI, it is basically nonsense. And sales is an exception, you can take the commission, the higher the sales, the higher the commission. The executive is also an exception. A CEO, how much the company's profits are his contribution. So if you think you are a good person, you should choose to go it alone, not join a big company. In a big company, your work is mixed with the work of many other people, and individual performance cannot be measured separately.
Like many before and SOHO business owners say: the boss you give me a pay raise and commission, corporate profits increased because I developed several large customers bring. The boss said: Why do you say that the increase in the company's profits is your contribution? The company still has a lot of cost, such as factory buildings, worker management, production equipment, raw materials, etc.? The two sides have their own positions and can’t talk about each other. Later, SOHO started their own business and then made a fortune.
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