Member-only story
We all get the same 24 hours — how can each of us end the day having created massively different amounts of value? Some may point to hard work as the determinant for the output someone creates, but I doubt that.
I would generously estimate that an incredibly hard worker would produce about 5x as much as the average person. And don’t get me wrong — 5x is pretty big, especially when added every day. Hustle culture would suggest that this is the root cause of success. That you can make anything of yourself with hard work. But there’s something else going on here — something that explains how one person can create more than a billion times the value someone else creates. The cause is leverage.
Pareto’s Principle can tell us a lot about leverage. His assertion that 20% of the inputs lead to 80% of the outputs describes this phenomenon. Some tasks are more worthwhile than others. Leverage is a multiplier — the higher our leverage, the more the outputs.
Outputs = Inputs * Leverage
And if we play our cards right, our outputs can actually increase our leverage. Take early-stage Facebook for example. Leverage for Zuckerberg comes in terms of the users he has. As he creates a better product, he gains more users, and thus his leverage increases — this allows him to create more value (which is his output) for fewer inputs (his…
