The Naval Ravikant Formula To Escape the Rat Race for Good

No. You are not getting an over-glorified version of Naval Ravikant’s life story here.

You have had enough of such rags to riches stories. Isn’t it so?

All those dated self-help tropes. The anecdotes of unshakable determination and sheer hard work.

Highly motivational.

Great for sales.

But there’s a problem.

These stories don’t work. They don’t really give you anything that you didn’t already know. They can’t do that because they fail to look beyond the myth.

Moreover, these underdog tales are so fixated on the now-and-then comparison that they fail to talk about something much more actionable — the execution.

“How, What, & Why” are the keywords here.

① How did the figure in question manage to achieve such feats?

② What did they do differently?

③ Why did they, of all people, succeed when others failed?

These are the questions you should be asking while trying to learn stuff from those who are more successful than most people.

Guess what! I did the same. And as a result, I found the Naval Ravikant formula to escape the rat race for good.

Don’t Just Work Hard

Okay, let’s get it out of the way. Working hard is essential. Without it, you are not going to get anything done. However, you need to be more than a hard worker to make it big.

In Naval Ravikant’s words:

It’s not really about hard work. You can work in a restaurant 80 hours a week, and you are not gonna get rich.

And why is that?

It’s because when you are an entrepreneur or a content creator, you are in a vastly competitive and open market. And guess what! Everyone is working hard here.

So trying to outpace everyone by hustling yourself to death isn’t the most efficient strategy. Here, you have to put more weight on your judgment. Before starting to work crazy hard, you must figure out:

✓ What to work on?

✓ Who to work it with?

As Ravikant puts it:

What you work on is probably the most important thing. Finding Product+Market+Founder fit, which is how well you are personally suited to the business. The combination of these three that should be your overwhelming goal.

Now, you must be thinking, how do I do it? How do I figure out…

What to work on

Simple. Before building a business, or even a career for that matter, you must ask yourself a few questions.

▪ Question 1: What should I be doing?

▪ Question 2: What is something that has an emerging market?

▪ Question 3: What product can I build for the said market?

▪ Question 4: Do I have the right tools, information, skillset, and resolve to produce that product?

▪ Question 5: Am I really into it?

How would that help?

You can save yourself a lot of time, if you pick the right area to work in.

Now comes the next part.

Picking the right people to work with is the next most important thing.

Whom to work with

Sometimes it all comes down to the quality of the people surrounding you. I repeat. It’s about the quality, not the quantity. That’s the one area where you need to keep raising your bar.

Make no mistake.

It’s work, not a holiday trip.

So you are not looking for pals here. You want to be around people with the highest skills, experience, and energy. That’s how you build the right network for your project.

And once you are done here…

Then the third comes how hard you work.

But working hard itself isn’t as simple as it might look. There’s a right way and a wrong way to do it.

It’s Not Sprint vs. Marathon.

It’s a marathon of sprints.

Let me ask you something. Is it about how many hours you push yourself to hustle? Or is it about what result you get out at the end of the day?

When you listen to people working 80–100 hours a week, most of it is status signaling and showing off. It’s because past a point, the more you work, the less you get done.

No. I’m not trying to sound smart. That’s how it really works.

According to studies, when you push yourself to work 70 hours a week, you only get the same amount of work done as those who put in 55 hours.

That way, you burn up your well-being for nothing.

Naval Ravikant believes the same:

Nobody really works 80 to 120 hours a week sustained at high output with mental clarity. Your brain breaks down. You just won’t have good ideas.

So how do you work in a way to maintain the highest output for the longest time?

First thing first, you… 

Take care of your body

The goal is to make it better for your future self, not worse. Simple lifestyle changes like:

☑ going for a morning walk

☑ eating well

☑ maintaining a steady sleep routine

☑ drinking more water and less alcohol

☑ doing light exercise

can help you extend the peak of your physique, retain your cognitive functionality, and give you enough wiggle room to deal with highly stressful situations without sustaining any lasting health hazard.

Once you are energized, you can…

Hunt like a lion

Now for the next point about the marathon of sprints, I’ll have to quote Ravikant again.

So really, the way people tend to work most effectively, especially in knowledge work, is they sprint as hard as they can while they’re working on something and they’re inspired and they’re arepassionate.

And then they rest. They take long breaks.

It’s more like a lion hunting and less like a marathon runner running.

That’s how you build a marathon of sprints.

Make Yourself Harder To Replace

It’s not that hard to understand. Yet, only a few people know this.

Most people wasting their life doing a job that anyone else can learn and do with minimum difficulty are incredibly easier to replace.

It means they lack any leverage over their market.

The market will never reward them well because they don’t have anything unique and valuable to offer.

Now, imagine someone with a unique set of skills that allows him to produce outstanding value according to the market’s demand. He will have significant leverage over the market as he is a rare commodity.

As a result, it will become much more challenging for his competitors to replace him. And it will reflect on his bank balance.

But how do you do it? How do you learn…

The most important skill to getting rich

According to Naval Ravikant:

Why so?

Knowledge is literally power. So the way to earn in the modern world is through knowledge and leverage, it’s not through work.

It is something even Tim Ferris attributes as one of the secrets behind his meteoric success:

Find a situation where you can be in the room with masters of a craft. That could be just deal-making…you sit in a room with an absolute pro at crafting deals, negotiating, and getting past no.

And why does it matter?

Learn before you earn. It’s never too late to do that. I don’t care if you are coming out of a college, out of a high school, 30, 40, whatever it is. System’s thinking. Focus on the skills and relationships first. And then you can just create a blank check for how much money you wanna make.

Will it be easy? No. Can everyone do it? Not at all. That’s one of the reasons why not everyone is living the life they want to live.

But if you want to get there, you must push your boundaries and strive to be good at things you are bad at. Once you set the intent, this might help.

Read More: Why Learning New Things Feels So Hard: 5 Little-Known Ways You Can Make It Easier

Build Your Own Compound Effect

Now, suppose you followed everything we discussed so far. Imagine, you have done everything right.

➊ You have found the right product-market fit for you.

➋ You have put together the best team there is.

➌ You manage to produce outstanding value for your market

➍ And you keep expanding upon your abilities.

Yet, for a year or two, you are not getting the return you think you deserve. Now, what would be the course of your action?

◎ Option A: Complaint

◎ Option B: Blame the market

◎ Option C: Both A & B+Quit

◎ Option D: Give it time. Keep improving your services and products according to the market. Build credibility among both your consumers and your associates.

Sure. Everything is contextual. There are no right or wrong answers. However, if you stick to the last option, you have a higher chance of making it big.

I’ll be passing the mic to Ravikant here:

Compounding in business relationships is very important. If you look at some of the top roles in society, like why does someone get to be a CEO of a public company or be on the board of a public company or why does someone get to be a banker who’s managing a billion dollars is because people trust them.

And why would anyone trust them out of all people?

Because the relationship in which they have worked, the work they have done, it’s kind of compounding. They’ve stuck with the businessand they have shown themselves in a visible and an accountable way to be high integrity people.

Not much to add here.

Step Out of Your Desperation

So, now, you know the value of being able to play the game with more reliable and established players. But why would they want to play with you?

Let’s hear from Naval Ravikant about how he chooses his playmates:

Whenever someone comes in as a newcomer what you have to basically decide is ‘Is this someone I’m gonna know a decade from now?’

That’s where your desperation and lust for quick results can work against you. As Ravikant describes:

I’m very weary of people who are over-optimizing for the moment. Because they are signaling they are not a long-term player. If they are not a long-term player, you don’t want to establish relationship with them.

As we learned in the previous section, your success relies heavily on the length and strength of your business relationships.

So you are going to play the same game with these same people over and over for decades. And when you do that, accommodating them a little better will only work in your favor.

It’s really not worth it trying to scam someone out of an extra $1000 only to damage your reputation and credibility.

Let me conclude this with one final piece of golden wisdom from Ravikant: