Getting rich slowly.
When asked, “You’re one of the richest people in the world, and when you explain what you do, it’s so simple. Why doesn’t everyone just copy you?”, Warren Buffett answered:
“Because nobody wants to get rich slowly.”
We live in a world where companies go from zero to billions in a year: Hopin, Clubhouse, Gorilla to name a few; where people make fortunes betting on Dogecoin or executing leveraged bets following WSB guidance.
Don't get distracted from real work—most of you have the luxury to avoid the games that don't compound but might make you rich.
In the current environment we see some:
investors playing a status game on who had the largest up-round. Celebrating high (paper) exit prices, complaining about high entry prices. We see investors pushing top-down business plans that are far from bottom-up ones dictated by operations. We see a fractured landscape with only super consensual deals getting done.
entrepreneurs raising tons of money, hiring fast, trying to beat the competition at their own game. We see every experienced entrepreneur back at building businesses fuelled by VC money, with entrepreneur conviction based on how much they can raise.
employees expecting full percentage points of ownership and targeting millionaire status within a year.
John Luttig from Founders' Fund explains the advent of the lottery culture, and while I believe people should make more bets, I also believe that expecting billions out of each one becomes an addiction. Randomness warps every incentive system and can make people miserable, just like workers in gold mines being paid with a bag of dirt 99% of the time.
Some people are lucky, but most are hard-working... and it's when others are taking the most risk that you have to be most careful. I find it helpful to remember that:
hard work always pays off,
discipline is what saves you over the long term. Like any culture, you define yourself by the things you say “no” to,
quick wins will distract you from long-term gains.
Fame correlates with wealth, but I don't believe success does. Most lottery ticket winners end up miserable and most athletes end up broke.
Three examples of long-term commitments struck me recently:
I read Shoe Dog, the auto-biography of Phil Knight, Nike's founder. It's a page-turner and I realized how long it took to build a legendary company through hard work and dedication. I realized how much of a hurry we are in in the startup world.
Box's founder Aaron Levie tweeted on always betting on mega-trends. Committing to the long-term and not deviating is a great recipe.
Our founders' experience with Sequoia or a16z. They are consistently impressed by the quality of the process they run and the depth of work done, despite having brands that could give them some leeway.
Non-linear outcomes are amazing, but they need to be the result of constant hard work. At The Family, we have always built for the long term, and, one day, we will look back at the first time we shook hands with an entrepreneur that made all of us rich.
Maybe it’s you? Join our next batch, starting in September 🤝