david perell nick sharma that creative life

How to Reach the RIGHT Audience, VC Funding vs. Bootstrapping, The Future of Education, and More – David Perell and Nik Sharma on That Creative Life, Hosted by Sara Dietschy

Key Takeaways

  • An online audience grants you access to previously unfathomable opportunities 
  • In many ways, bootstrapping > raising venture capital
  • Work on things outside of the spotlight 
    • “What everyone’s focusing on, almost by definition, are the things you shouldn’t be focusing on”David Perell
  • The future of education is already here
    • “The future of education arrived 10 years ago. It’s called YouTube. It’s called the internet. Whatever you want to learn, it’s right here for you. The only barrier between you and where you want to be when it comes to learning, it starts with a ‘d’ and it ends with ‘iscipline.'”David Perell
  • A sound note-taking system makes writing about your ideas much easier
  • Cities often afford opportunities that make the high cost of living worth it
  • “The way that society tells you to be friends with people, I think, leads to really empty relationships. I think depth and time is what you need to really begin to appreciate somebody because all of us wear masks. We all have a shield over ourselves to try and communicate the person we want other people to think we are. It’s only with time that you can break through the facade everyone is putting on.” – David Perell

Books Mentioned

  • The Complacent Class by Tyler Cowen
    • The book details how Americans are becoming more complacent, stagnant, and less dynamic than ever before

Intro

Writing vs. Video

  • “In an aggregate sense, the world is moving towards video” – David Perell
    • 6.5 billion (!) people have watched the Despacito music video, making it perhaps the “most-seen” thing in human history
    • That said: “If you look at the very smartest people in the world, they’re consuming more of the written word than ever”
      • And THESE are the people David is trying to capture

The Power of an Online Audience

  • In 2019, David estimates he’ll get ~1 MM visitors to his website before year’s end
  • “Having an online audience is like having your own personal artificial general intelligence” – David Perell
    • For one, you can quickly get great recommendations
    • Also, an online platform/audience gives you access to tons of cool opportunities/people
      • “The people I’ve always wanted to meet, the people who are obsessed with ideas, your writing begins to attract those people. You’re almost sending a radio frequency into the world… The right people begin to find it, get on your frequency, and subscribe to your stuff… The amount of work I do doesn’t really increase, but the number of people I reach does.” – David Perell
  • View your online writing as a marketing expense that brings people into your life who can then create other opportunities 
    • “On one hand, writing is a terrible way to make money, but on the other hand it gets you in the room and opens the kinds of doors that are tremendously lucrative”David Perell

Working for Yourself Isn’t All Sunshine and Rainbows

  • “Just because there’s this wave of people making it cool doesn’t necessarily mean everyone has to run their own business. When you’re at a 9-to-5, you have time off, you have weekends… What people don’t realize is when you’re working for yourself, it really never stops.”Sara Dietschy
    • But in your 20s, there’s really no better time to give it a try

Venture Capital vs. Bootstrapping

  • Many of the companies Nik has worked with have raised millions in venture
    • “I think the biggest thing that gets taken away, especially in the earlier stages, is the creativity” – Nik Sharma
      • How so? – Instead of genuine problem-solving, VC-funded startup tend just to throw capital at problems
  • Take Casper and Away – they’ve raised hundreds of millions, but most it goes straight towards marketing
    • (Side point – Sara LOVES her Away suitcase)
  • “A lot of these VC-backed companies aren’t going to be recession-proof. When people become strapped for cash, they’re just going to starve because their entire business model is predicated on just going out and fishing for customers every single day. The second they can’t do that, they’ll starve.”Nik Sharma
  • “If you look at the global investment market, VC represents ~2% of all the money that goes into it. It’s an extremely small part of the entire investment world.” – David Perell 
    • And despite what you may hear about this being the “golden age of entrepreneurship,” the rate of new company formation in America is decreasing
  • 🎧 “The happiest people, in aggregate, that I meet are people who raise no venture capital, they’re running their own businesses, and have a very low-cost basis. Often they’re software companies. They don’t have a lot of competition. They solve some kind of narrow problem, and a large parentage of them are making millions of dollars a year. They have a couple of employees, no one’s ever heard about them, and they’re basically invisible in the world. I think we should be promoting that so much more than this venture capital LUNACY fiasco that we’ve gotten into.”David Perell
  • 🎧 “We need to remember that, as an industry, venture capital is almost too good at marketing for society’s good” – David Perell 
    • Nowadays, every VC is basically their own personal brand

Commentary Culture

  • Jenna Fisher and Angela Martin, Pam and Angela from The Office, recently started an Office re-watch podcast – Office Ladies
    • Sara’s been loving it
  • “Once you get the background of something, all of a sudden, that thing becomes more interesting” – David Perell
    • Take the restaurants that are featured on Chef’s Table and then go on to become quite popular
  • Another example: Artist commentary albums on Spotify

Differentiate Yourself

  • “One of my core beliefs about what to work on is to work on things outside of the spotlight because everybody works on things that are inside the spotlight”- David Perell 
  • 🎧 In 2007, 50% of Harvard grads went into either investment banking or management consulting
    • On top of these two areas, if you add law and medicine, these are the industries where there’s the most competition
      • “Those are the jobs and the industries that swallow ambitious people who aren’t ambitious because they want to work on something that’s transcendent or something comes from their own internal desire. It’s ambitious people that think just because something is competitive, it’s worth working on.” – David Perell
  • “What everyone’s focusing on, almost by definition, are the things you shouldn’t be focusing on. But we live in an entire world that’s hyper-imitative, where everyone imitates what other people are doing.” David Perell

The Future of Education

  • A college degree is no longer enough for a good job out of school; you need a master’s degree, Ph.D., etc. (= tons of debt!!)
    • Related: “I think the vast majority of colleges are going to be out of business in 20 years” David Perell
      • Last year, Clayton Christensen, a Harvard Business School professor, predicted that in the next 10-15 years, 50% of American colleges would go out of business
  • 🎧 “The future of education arrived 10 years ago. It’s called YouTube. It’s called the internet. Whatever you want to learn, it’s right here for you. The only barrier between you and where you want to be when it comes to learning, it starts with a ‘d’ and it ends with ‘iscipline.'”David Perell
    • “You have all the tools. It’s important for people to take agency themselves because of what you can do with all the world’s information in your pocket.”
  • If you feel like you aren’t quite sure what you want to study, and don’t feel like dropping $50k on a semester of college…
    • “Community college is widely under-rated” – David Perell

Good Note-Taking Improves Your Writing

  • Nik uses Instapaper to save online articles he plans to read
  • 🎧 David only writes ~10 hours/week (and never more than 90 minutes/day) – he’s extremely efficient
    • “I sit down at my computer. I compile exactly what I need to, and boom. Zero friction. I’m in a flow state in 3 minutes… I set a really ambitious goal for myself and get in the flow. I turn on the same kind of music I listen to at the gym. It’s the same state of mind. Let’s get after it. Let’s go. And let’s accomplish so much in a super short amount of time.” – David Perell
  • “The biggest thing holding people back from writing better is having a note-taking system. Writing isn’t nearly as hard as people say, but the entire education system for writing was built before note-taking systems existed.” David Perell
    • So, if you have an idea, jot it down in a searchable note-taking app. Never do the same thinking twice if you don’t have to.

Certain Cities Afford Opportunities That Make the High Cost of Living Worth It

  • That’s why Sara pays $3.8k for her Brooklyn apartment
  • In NY, there’s no room for complacency – everyone living there is after something
    • The city BREATHES ambition – EVERYONE is hustling
  • “Cities are merry-go-rounds… You’re in something together with people, and you expend very little energy to go fairly fast.” David Perell
    • Once you get on the merry-go-round, you have access to all these cool opportunities 
  • Cities are becoming huge hot-beds of economic opportunity, but there are two problems preventing cities from experiencing further growth (and more people from joining the merry-go-round):
    • Not enough housing is being built, thus driving up living costs 
    • Transportation speeds have slowed, especially in NYC, primarily spurred by the 1995 Williamsburg Bridge subway crash
      • The NYC subway system has actually gotten slower in the last 20 years (and more than half of NYC subways on the 456 line are delayed on your average weekday)
        • How things differ: In Hong Kong, if a train is more than 8 minutes late, they have to report the reason why to the government
      • With faster transportation, it’d be easier to live outside of cities and commute in for work
  • “People who get paid in equity are in SF and NY… People who get paid in cash are moving to Texas [like Tim Ferriss].” – David Perell 
    • Why? – Texas has low capital gains taxes

The Power of Podcasting

  • David calls long-form podcasting “the single best tool for human education at scale ever created”
    • “Long-form podcasting is going to change our politics for the positive. It’s going to allow people to realize that the lecture they can get in their ear while walking to and from school is better than anything they got while they were sitting in their seat at school.” – David Perell
    • “Long-form podcasting is going to be the gateway drug to what you can do learning on the internet” – David Perell

A Few Lessons on Friendship

  • Hanging with friends in smaller settings for more extended periods of time >> hanging with a large group of friends for a shorter period of time
  • David has a rule: “I only hang out with people in groups of 2 or 3… for 2 hours or more” – David Perell 
    • One primary reason: It takes an hour or so to get “warmed up” – the meat of the conversation happens after that
  • 🎧 “The way that society tells you to be friends with people, I think, leads to really empty relationships. I think depth and time is what you need to really begin to appreciate somebody because all of us wear masks. We all have a shield over ourselves to try and communicate the person we want other people to think we are. It’s only with time that you can break through the facade everyone is putting on.” David Perell

Additional Notes

  • In 1960, 40% of the time, when you got a new job, you also ended up moving houses. Now, that number’s dropped to 10%. 
  • Check out Community, a new texting platform
  • Nik recently chatted up a NYC taxi driver who told him he makes ~$200/day, but ~$100 goes to leasing the taxi, and ~$70 goes to meter fees
  • David and Nik recently saw Illnium at Madison Square Garden
  • “So many of my best ideas have come from getting things entirely wrong” David Perell
  • Sara studied electrical engineering in college
  • David’s writing school, Write of Passage, has brought in more than $1 MM in revenue
  • “When you’re around other smart people who are also creative, then you become more creative”David Perell
  • In San Francisco, the median home price has doubled in the last 8 years
  • Nik gets free lifetime Cha Cha Matcha 
  • “You end up copying the people whose stuff you consume, subconsciously” – David Perell
  • David greatly admires Patrick Collison, the CEO of Stripe
    • “What he’s doing, in terms of building what I think is going to be known as the most operationally efficient company in the world… I mean, you walk into Stripe headquarters, and you say, ‘This place is special.’ … If Disney Land was a library, it’d be Stripe. It has this full-on ambition to build products that allow people to use the internet to create economic opportunities for themselves. It’s a special place.” – David Perell
  • Sara really enjoyed Tim Ferriss’ podcast with Ken Burns (Podcast Notes)
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