How To Get Rich (Without Getting Lucky)

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Dear Friend,

Happy Wealth Wednesday (on a Thursday).

Today I want to share one of my favorite writings ever. The funny part is that it is not directly about investing. It is actually a piece on psychology written by one of the most famous investors of all time.

In this week’s newsletter, I will break down my seven favorite lessons from it and show how they still matter for investors today.

Naval Ravikant is one of the most respected thinkers in the world of startups and investing. He co-founded AngelList, invested early in companies like Twitter and Uber, and built a reputation as someone who can simplify the complex game of wealth creation into timeless principles.

He’s known not just for spotting great companies, but for the way he thinks about leverage, ownership, and compounding. His ideas have spread far beyond Silicon Valley because they apply to anyone who wants to build lasting wealth.

Today, I want to walk you through seven of Naval’s most important ideas. These are not shortcuts or tricks. They’re a framework for how to build wealth over time without relying on luc/k.

1. Seek Wealth, Not Money or Status

Naval makes a clear distinction between wealth, money, and status. Wealth is owning assets that earn while you sleep. Money is a way to move wealth around. Status is just your perceived rank in society.

Why it’s important:
Chasing money or status often leads to frustration because they don’t compound. Wealth does. Wealth comes from owning businesses, stocks, real estate, or intellectual property that generate returns long after your initial effort.

Investing connection:
As investors, our focus should always be on wealth. Buying stock in a great business means owning a piece of that company’s cash flow. Over time, those earnings compound, which is how true wealth is built. It’s why Warren Buffett calls stocks “a piece of a business” instead of just ticker symbols.

2. Play Long-Term Games with Long-Term People

Naval often says wealth comes from compounding, not just compounding money but also compounding relationships and knowledge. Short-term thinking and short-term partners rarely build anything lasting.

Why it’s important:
When you surround yourself with people who share your values and think in decades, not quarters, you create an environment where trust and consistency drive results.

Investing connection:
The stock market rewards patience. Investors who think long-term avoid chasing hype and instead look for companies that can compound for 10 or 20 years. Partnering with founder-led businesses or investing alongside management teams with a proven long-term mindset is exactly what “playing long-term games with long-term people” looks like in practice.

3. Build Wealth Through Ownership

Naval reminds us that renting out your time will rarely make you wealthy. A salary can provide stability, but true wealth comes from ownership. That means owning businesses, real estate, stocks, or intellectual property that continues to generate returns long after the initial effort.

Why it’s important:
Ownership is what separates those who just work for money from those who build lasting wealth. When you own assets, your wealth grows even when you are not working.

Investing connection:
Buying stocks is one of the most accessible ways to build ownership. Each share represents a slice of a company’s future earnings. Over time, that ownership compounds. Think about someone who bought Apple or Costco years ago and simply held on. They were not just trading tickers, they were building wealth through ownership.

4. Leverage Is the New Force Multiplier

Leverage is about getting more output without more input. Naval breaks it into three main types: labor, capital, and code or media. Labor means people working for you. Capital means money working for you. Code and media are the most powerful because they scale without permission and reach millions at almost no cost.

Why it’s important:
Leverage multiplies the impact of your decisions. With the right leverage, one good choice can create wealth for years.

Investing connection:
When you invest, your capital becomes leverage. Every dollar you put into a business goes to work around the clock, compounding as the company grows. People who create content or software gain another form of leverage by building something that continues to reach others long after the work is done. The combination of capital and scalable outputs is what accelerates wealth creation.

5. Wealth Requires Judgment

Leverage and capital only matter if paired with sound judgment. Naval points out that in a world of infinite information, the ability to make clear, rational decisions is one of the most valuable skills. Good judgment compounds just like money does.

Why it’s important:
A single bad decision can wipe out years of progress. On the other hand, a track record of good judgment attracts more opportunities and more capital. People want to work with and invest alongside those who consistently make smart choices.

Investing connection:
The best investors are not the fastest, they are the most disciplined. Warren Buffett built Berkshire Hathaway not by chasing every opportunity, but by exercising judgment on when to act and when to wait. As investors, sharpening our ability to evaluate businesses, management teams, and valuations is what turns leverage and capital into lasting wealth.

6. Learn to Build, Learn to Sell

Naval says if you can build and you can sell, you will be unstoppable. Builders create products that solve problems. Sellers bring those products to the world and convince people to adopt them.

Why it’s important:
Wealth is created when value is built and distributed at scale. Having one skill without the other limits your impact, but combining both creates exponential opportunity.

Investing connection:
As investors, we need to evaluate whether companies can do both. A company may have great technology, but if it cannot sell it effectively, growth stalls. On the other side, strong marketing without a solid product leads to short-lived success. The companies that thrive long-term master both building and selling, which is exactly what makes them attractive investments.

7. Compound Yourself

Naval often says that the most powerful force in the world is compounding. It does not just apply to money, but also to knowledge. The more you learn, the better your judgment becomes, and the better decisions you make with your time, money, and energy.

Why it’s important:
Wealth creation is the result of consistently improving yourself. Reading and learning give you frameworks for how the world works, which reduces mistakes and sharpens your edge.

Investing connection:
Charlie Munger, Warren Buffett’s longtime partner, built much of his investing success by reading constantly. He said he wanted to go to bed a little wiser than when he woke up. That steady accumulation of knowledge compounded into extraordinary investing skill. As investors, the more we read and learn, the better our decisions become, and the more likely we are to grow wealth over time.

Conclusion

Naval’s principles are simple but powerful. They strip away the noise and focus on what truly builds wealth.

Seek wealth, not status. Play long-term games. Own assets. Use leverage wisely. Sharpen your judgment. Back companies that can build and sell. And most importantly, keep compounding yourself through reading and learning.

These are not hacks or shortcuts. They are the foundations of wealth creation. If you apply them consistently as an investor, you do not need to rely on luck. Time and discipline will do the heavy lifting for you.

Matt Allen

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