The god of compounding
The way to wild success and so much more
If you want to achieve outlier success, compound yourself is the number one way1, Sam Altman once wrote in his blog. A few points he made left me pondering:
“You don't want to be in a career where people who have been doing it for two years can be as effective as people who have been doing it for twenty”
“I am willing to take as much time as needed between projects to find my next thing. But I always want it to be a project that, if successful, will make the rest of my career look like a footnote”
“Focus on thinking long term. One of the notable aspects of compound growth is that the furthest out years are the most important”
While I’ve never desired outlier success, I find these words pieces of wisdom often forgotten in today’s world.
I’m not talking about how compounding can make one rich, well-connected, influential. I’m talking about direction, agency, the peace-of-mind pursuing a long term goal vs. the real pain of forgoing instant gratifications. Allow me elaborate.
Direction:
For those who love maths, you know how powerful exponential growth is. Hence use this power wisely and set a good direction for that curve. Spending time with smart people will lead you to meet more brilliant minds, whereas hanging out with a bad crowd is a guarantee for self-destruction. Quantity is only important if it’s of the right quality.
Agency:
Agency is the power to choose, which direction and how much. It is what Sam meant when he said “you don't want to be in a career where people who have been doing it for two years can be as effective as people who have been doing it for twenty”. People are not born with complete foresight, choosing the right direction shouldn’t be in the way of getting in motion. Agency allows one to manifest changes. And agency is extremely important because time does not compound, we all have just one life.
Long-term peace & short-term pain:
Compounding, direction, agency, all efforts combined, do not necessarily lead to happiness. Why? Because exponential curve can be really slow at the beginning. If you are outcome-driven, this phase probably means a lot of pain and frustration. It asks for patience and conviction. One trick is to justify everything with a sufficiently attractive return, like Sam wrote “I am willing to take as much time as needed between projects to find my next thing. But I always want it to be a project that, if successful, will make the rest of my career look like a footnote”. Another less pumped up way is to realise it’s all in our minds, happiness is a state of mind, not a formula. Even if you are achieving outlier success, if your mind is not in the right place, you are still unhappy. Hard work and strong mind, you always need both.
While not directly linked, I found a deeper appreciation of compounding after started playing sports. Roger Federer gave an inspiring commencement speech at Dartmouth this month and I want to highlight some of his words:
“Effortless is a myth …The truth is, I had to work very hard to make it look easy. I spent years whining, swearing, sorry, throwing my racket before I learned to keep my cool…I didn’t get where I got on pure talent alone. I got there by trying to outwork my opponents.
“When your game is clicking like that, winning is easy relatively. Then there are days when you just feel broken, your back hurts, your knee hurts – have that a lot. Maybe you’re a little sick or scared, but you still find a way to win. …And those are the victories we can be most proud of, because they prove that you can win, not just when you’re at your best, but especially when you aren’t.”
“Talent has a broad definition. Most of the time, it’s not about having a gift. It’s about having grit. In tennis, like in life, discipline is also a talent. And so is patience. Trusting yourself is a talent. Embracing the process, loving the process is a talent. Managing your life, managing yourself. These can be talents, too. Some people are born with them. Everybody has to work at them.”
“But negative energy is wasted energy. You want to become a master at overcoming hard moments. That is, to me, the sign of a champion. The best in the world are not the best because they win every point, it’s because they know they’ll lose again and again, and have learned how to deal with it. You accept it, cry it out if you need to, and then force a smile. You move on, be relentless, adapt and grow.
So here you go, gifted as Federer, he had to constantly battle himself. The beauty is however, holy guacamole, his mind compounds on itself and confidence too.
I want to jot these thoughts down primarily as a reminder to myself that nothing should be reason enough to deter me from doing something I like, because as long as we are consistently pushing in a single direction, the power of compounding can do wonders. This power does not only makes people rich, famous, powerful but also makes earth flourish, life possible.
So don’t feel short, just take a shot.
P.s. what I want to compound the most on in life: a mind that can be awed by beauty. what about you?
How to be successful by Sam Altman