We try to do this at least once a year where we highlight new trends we’re seeing. Naturally, the trends we see will be related to the environment we’re in so you’ll get a clean glance at things we’ve been doing lately if you’re able to read between the lines. The range is quite wide from the upcoming generation (people in their early 20s) to ultra high-end where we’ve been lucky enough to hang out with some wealthy people out of our league (hey at least we got entrance to the cheap seats! Always want to be one of the worst people in the room if you want to get better).
Ultra Rich People Quirks: We gave away our view of intelligence before, but in this case we’re just narrowing it down to ultra rich people. Ultra rich is defined as someone who will be worth $50M+ or is already worth $50M+. That is ultra rich by any logical person’s definition. We think $10M is actually doable but when you look at $50-100M+ it’s quite the jump and we’ve noticed some strange commonalities between the ultra rich.
Off Eye: No we are not joking. Please google image search Charlie Munger, Jeff Bezos and Keith Rabois to start. You’ll find that in many images one of their eyes tends to close while the other one remains fully open. It’s extremely odd and once you see it you’ll see it more frequently when hanging out around wealthier people. No we’re not saying that people with strange eyes are all “geniuses” we’re just highlighting a pattern we’ve seen occur many times. There are many geniuses with normal eyes and messed up ones. After all, for decades people have assumed that having glasses implied you were smarter. There might be something to this given that we’ve noticed a strange trend over the past year or so.
High Pitch and Talking Patterns: Another interesting one is that a lot of them have either 1) a high pitch, 2) a slight lisp, or 3) an odd repetitive phrasing. The first two are extremely easy to notice, a slightly higher pitch and a slight lisp. This is why cartoon characters of geniuses always have a strange speaking pattern as well (the cartoon Futurama is probably the best example of this). The third one has been picked up, Peter Thiel is a great example and even though his voice sounds relatively normal, he still states “the” two to three times in a row and has a constant “but um” phrase he uses quite frequently. Our best guess is that smart people have to think of a way to “dumb down” what they want to say for a wider audience. To do this they either repeat the same phrase a couple of times or take blatant pauses. Since they don’t really care about “appearing smart” since they are already rich, this results in odd speaking styles. For those that are still following the crypto currency space, the people in these arenas have the same issues cited in this paragraph (amped up at least 10x).
Focus on Ownership: We’re going through this mental transition as well. Instead of trying to get cash flow numbers up, it eventually goes to a pure focus on ownership. While cash flow is certainly a top priority, the cash flow generated is a by product of ownership. If you own 10 different businesses that all deliver enough value to be profitable, it really doesn’t matter what the cash flow number is over a 10-year frame (under the assumption margins remain flat to up consistently). What matters? Making sure you have a large chunk of ownership so you can control the direction of the business/assets. The same concept rings true, you don’t want “money” you want “wealth” which is anything that generates money for you without the use of your time.
Very Fast and Judgmental: If people really believe we talk too “matter of factly”… we recommend they enter into a wealthy environment. When we say “wealthy environment” we don’t mean a conference where they fake being happy go lucky and “anyone can make it” type attitude. We mean a closed door situation where everyone is trying to compete and get somewhere. You’ll see a much more vicious side to the rich. They will immediately judge your worth with a single glance or 2 minute conversation. Seriously. We thought we were terrible with this type of attitude and what we learned is that we need to step it up dramatically. If your first sentence doesn’t prove your worth, you’re wasting their time. If someone reads this whole blog we’d say that is the main takeaway we’d write down at this point. You should be able to prove your value in a sentence or less. It is absolutely ruthless out there as everyone wants “attention” from rich people but they don’t have time to listen to a life long story.
Slimming Optionality: This is really for people in their 20s. The number of openings for high paying positions are coming down and this seems to be reflected in the culture in two ways: 1) people no longer interested in having kids – both men and women and 2) significant change in the type of people that go out at night. This one is hard to explain but we’ll try. The most attractive women are either going out to the most expensive places or they are giving up entirely and going out a lot more during the day. The number of attractive people you see walking around a park vs just 5-years ago is dramatic. This might be an east coast thing so we’re interested in hearing about the general answer here but it’s pretty clear. Women are actually taking the time to look nice and go out during the day since they don’t want to go to bars/clubs unless they are ultra high-end (which is becoming less economical). Its actually a lot more common to see higher quality women in restaurants and parks than the clubs lately (again exception is ultra high-end and luxury house parties).
Our best guess is that the college culture has only gotten crazier with everyone hooking up with everyone else. Especially the people in the “upper middle” of attractiveness. The top tier ones (with brains) won’t do this but it’s pretty easy to imagine a bunch of 7s sleeping around town since they have tons of debt a very little to look forward to. Another one we’d bet on is an increase in general anxiety levels (panic attacks) as a lack of “going somewhere” looms over many people.
On the positive side of the ledger after those two negative observations, the quality of life has gone no where but up. Even low income people have access to fast internet and information if they like. So we’re living in the best age in history (platinum age) to get rich… It’s just a small number that actually make it. We’re going to look into this information at the end of the year. We’d bet the tail distribution of earnings is showing up even for people in their mid-late 20s. Meaning even people who are 5-7 years out of college have incredibly large differences in terms of earnings (heavily skewed distribution).
Lifestyle Observation: All of this builds up to a strong pattern we have seen over the last couple of years. People who have high social skills are working less while earning large amount of money while those that have poor social skills are working incredibly long hours all of the time. This makes a lot of sense. Remember, we’re only referring to high income people in this paragraph (and blog in general at this point). If you have a high income, you either have lots of fun so you don’t care about making 30% more. And. If a person has weak social skills, their entire “self worth” becomes their career/business so they just keep working long hours forever. It is amazing to watch real time at around age 30. This is the easiest time in your life for social skills, energy and money. So if the person cannot have fun with everything working in his favor… he’s not going to figure it out and ends up focusing all of his effort on making tons of cash. To make matters worse, the guys who have good social lives and make good money don’t want to help these other rich people since they are likely “downers” to any event they would have. If you don’t need money there is no reason to ruin your personal life to make a few extra bucks.
Women Appear More Aware: Again. This is referring to attractive women, not your run of the mill person. They seem to have caught on to this shift in resources/quality of men. So you see the same girls trying to get into the same circles. They avoid the common person like the plague. Can’t believe this is being written out in print, but over the last 5-years it appears that high quality good looking women are starting to make changes to their strategies. This is probably due to socioeconomic adjustments more than anything else. And. It could also be dead wrong and we’re just benefitting from the move up the ladder.
Increased Insecurity: Combining the two prior concepts we’re seeing a pretty large increase in insecurity. Men and women appear more and more insecure. This is highlighted by the skyrocketing growth of plastic surgery and the increased number of guys who get “upset” if you buy something expensive. The women probably feel pressure to look better due to Instagram filters and most guys (97% that don’t even make it to a million) feel that they should be better than everyone else. Our basic observation (and prediction) is that this will continue for the next five years at minimum. The more attractive women are waking up to the fact that there are smaller high quality options out there (increase plastic surgery to compete) and more guys will talk about “minimalism” since they can’t produce due a lack of talent (this also leads to hate against anything material).
As a bonus, the increased insecurity appears to be spreading into the “mens” section as well. Male grooming is a popular growth area (yes seriously) and we won’t be surprised to see this increase in the future as well. If you have no skills/talent and can’t make money, then your next best option is to become as attractive as possible to try and somewhat level the playing field (at least until age 40 or so). We’re not against this strategy at all (as a temporary fix), it just shows how much has changed in a few short years. To put the bow on this section, if this continues we wouldn’t be surprised to see men go through basic surgeries in the future as well (most likely liposuction).
Looking at this section you’d think an increase in “materialism” would result from increased insecurity. The catch? The average person doesn’t have money. So the best they can do is a one time change to fix something and appear better looking. We’ve gone from insecure people buying BMWs/Mercedes to having plastic surgery and budgets for grooming/liposuction. It’s essentially the same market just spun in a different direction. After typing that up, should really consider normalizing surgery for men and profiting off referrals. In summary, the new “insecure” spend a lot more money on physical improvements as they are less costly, stand the test of time (usually) and don’t come off as materialistic.
Increased Unhappiness: Another one we’ve noticed is that the vast majority of the population is unhappy in the USA. This has actually gotten worse from 2010 (at least it appears that way). In fact, it’s so common you can tell what a person thinks of you based on this comment alone. If you have your life together and are thrilled (you should be) anyone who says you’re “unhappy negative” is really saying “I don’t like you”. Since you’re a reflection of what they “could have become” as everyone believes they are the best, they have to come up with something negative to say that is intangible.
So as a useful social skill test, you can figure out who everyone likes or dislikes within a group by saying “that guy/girl is so happy all the time don’t you think”. This seems like an innocent comment but their reaction to you will tell you what *they* think, which is the information you were searching for in the first place. If you meet someone new and tell someone else you think he/she is a happy guy/girl, they will now be forced to reveal if they like or dislike the person. It really is that simple these days. Luckily this blog is niche so people won’t be using it any time soon. Take it to the end and it makes logical sense as well. Do you have any friends that you think are “always unhappy”? No. Hence why this social trick works so well and has been working so well for us the past 3 years or so.
Severe Change in Fashion: You can tell a lot about someone simply by the way they dress. In the past, fashion seemed to be more similar. It was not easy to figure out a persons social life by their clothing… Now? It seems to be quite easy. In fact, its so blatant we can even see it in the corporate world. The type of suit a guy wears and the color ties he puts on tell you everything. Hint hint, the guys with nice accessories and a suit that doesn’t fit correctly is the standard insecure corporate guy. The guy with everything tailored with the colors matching… that’s the guy partying as soon as the day is over.
Emotions at Work: We read a book on management earlier this year called “No Hard Feelings”. Holy smokes. The content wasn’t mind blowing but the realization that there can be so many emotions at work. When you’re busy outsourcing as much as you can you forget how many people are dealing with office politics day in and day out. “No one quits a bad job, they quit a bad manager” appears to be more true today than it has been in the past 10 years.
As a quick summary, assume that everything you write to anyone who works for you will obsess over every detail from the time you sent it to the number of periods and exclamation points you use. As a repetitive secondary summary, for the love of God, do not hire anyone you do not have to hire. The book really highlights how irrational people are (that was our takeaway). Since the new generation has grown up staring at a computer screen/smartphone all day, they really read into every single detail since they are trained to do this. Photos, word choices, length of message… everything.
The general item to look out for? Expect people to spend more free time with their co-workers. Since people are becoming less family oriented and more focused on their work being their “identity” you should see more of this. This of course goes directly against our advice of assuming your co-workers are not your friends (they aren’t). So you’re in luck if you found this blog. Your co-workers are going to be busy making friends at work while you’re busy building up your own biz and improving paid performance metrics at work (KPIs).
Our next post is going to be on markets/businesses we think will grow over the next several years. The beginning of this post essentially gives away “how we got the ideas” which is just a collection of consensus ideas from ultra rich people. Hopefully this post is of value to someone trying to make the next jump in life since we’ve given away very clear clues to pick out the winners in any crowd through social tells. (Yes this was also written on a phone, a new strategy while the longer posts will be saved for a laptop)
