Charlie Munger on Mental Models, Wisdom, and Human Psychology

charlie munger mental models

Your brain is a roughly million-year-old piece of hardware – designed and built to operate in the world of hunting and gathering – where a dangerous animal may lurk behind the nearest bush. While our society has changed massively in the last 10,000 years (or even the last 500 years) – our brains have not had time to catch up.

You and I are equipped with a tool that – while wonderfully sculpted by evolution to thrive and reproduce in the world of hunter-gatherers – is riddled with shortcuts and processing errors that can manifest in mistakes, calamities, and all around terrible decisions.

Over the last year or so I have spent much time studying Charlie Munger – the billionaire “right hand man” of Warren Buffett. Charlie developed a rather unique worldview on human behavior and problem solving (that he dubs “worldly wisdom”) rooted in the idea fundamentally that you need a wide range of tools (what he calls mental models) to solve the many problems that life throws at you.

Among one of Charlie’s greatest insights were the combined notions that  (1) all academic disciplines must respect each other in order to be true and (2) that psychology underpins nearly all of them because it impacts and shapes human decisions.

What this means is that to think more effectively and achieve your goals you need to both master psychology and understand the mental models that underpin reality.

One of the most powerful things that you must understand about everything that I’m sharing with you here – these are not anecdotal observations or opinions – the decisions, mistakes, and behavior patterns that human engage in again and again, to their own determinant, are rooted fundamentally in science and proven repeatedly by numerous psychological studies.

Learning More About Charlie Munger’s Mental Models

As a starting point for that journey, I wanted to share with you several resources that I have learned from along the way.

I would absolutely start by watching (or listening to) this Youtube Video of Charlie Munger on “The Psychology of Human Misjudgment.” The video is priceless and I’ve listened to it 10+ times. Some of the examples are a bit dated because the speech is from 1995, but the message is timeless.

From there, I would recommend digging into a few books. I’ve put these in a particular order and suggest sticking to it – this will slowly introduce you to the topic and layer in key pieces of knowledge to build a more comprehensive understanding of Charlie Munger’s Mental Models and the Psychology of Misjudgment. [Click the titles for a link to Amazon]

Predictably Irrational by Dan Ariely

Predictably Irrational is absolutely the best starting place to dip your toes into this subject. It’s a quick read that is easy to grasp and has some great examples that will stick with you. I would compare this to Freakonomics in the sense it’s aimed at a popular audience and does a great job making the subject very approachable.

Influence by Robert Cialdini

In many ways the “bible” of this school of thought – Charlie Munger even mentions it several times in his speech on the psychology of human misjudgment. More technical than Predictably Irrational but a critical next step to go deeper on the topic.

Poor Charlie’s Alamanc by Peter Kaufman

Once you’ve completed your necessary psychology prerequisites – now its time to dig into the meaty stuff. This is a big book, I’m not gonna lie to you. Read every word. This is where Charlie Munger really starts laying out his framework for Worldly Wisdom and explaining in detail how to use psychology as well as mental models to think about the world. This book will explain how and why “worldly wisdom” and “mental models” are important, but does not go deep into actually explaining every mental model that governs reality.

Seeking Wisdom by Peter Bevelin

WARNING: DO NOT READ THIS FIRST. That said, wow. This book. I have never in my life underlined more phrases in a single book. This is probably the most information dense book I have ever read. It’s a treasure trove of information and can serve as a vital reference book for the rest of your life. You absolutely have to read the other books first or this will be like reading something written in Mandarin. This fills out an extremely detailed checklist of both the “Psychology of Misjudgment” and the “Psychics and Mathematics of Misjudgment” – replete with pages and pages of detail, studies, and information on a huge array of mental models.

Thinking Fast & Slow by Daniel Kahneman

Kahneman is a titan among research psychologists and in many ways the godfather behind many of these concepts – including being one of the founders of Prospect Theory, which uncovered many of these mental models and how they shape the world. This book is BIG and full of tough and often counter-intuitive mental models and psychological concepts, but this is the book you want to read to really dig into the core research that underpins much of these other books.

Podcasts on Mental Models

I wanted to share a few links to two Science of Success Podcast episodes where we also dig into these topics.

The Psychology of Making Better Decisions with Michael Mauboussin

How to Build a Toolbox of Mental Models to Understand Reality with Shane Parrish

Blog Posts on Mental Models

I also wanted to share a few links to two blogs that I particularly enjoy that both have wonderful and deep sections focusing on mental models.  Each of these are filled with dozens of mental models as well as examples and explanations to help better understand them.

Farnam Street – Mental Models

Joshua Kennon – Mental Models

Mental Model Checklist – Human Misjudgement

As a bonus for you – I’ve also included Charlie Munger’s (updated as per Seeking Wisdom) checklist of the standard causes of human misjudgment.

1)     Bias from mere association

2)     Underestimating the power of rewards and punishment

3)     Underestimating bias from own self-interest and incentives

4)     Self-serving bias

5)     Self-deception and denial  – distortion of reality to reduce pain or increase pleasure.

6)     Bias from consistency tendency – includes confirmation bias – looking for evidence that confirms our actions and beliefs and ignoring or distorting disconfirming evidence.

7)     Bias from deprival syndrome

8)     Status quo bias and do-nothing syndrome

9)     Impatience

10)     Bias from envy and jealousy

11)     Distortion by contrast comparison – also underestimating the consequences over time of gradual changes.

12)     Bias from anchoring – over-weighing certain initial information

13)     Over-influence from vivid or most recent information

14)     Omission and abstract blindness

15)     Bias from reciprocation tendency

16)     Bias from over-influence by liking tendency – includes bias from over-desire for liking and social acceptance

17)     Bias from over-influence by social proof

18)     Bias from over-influence by authority

19)     Sense making – construction explanations that fit an outcome – being too quick to draw conclusion, also thinking events that have happened were more predictable than they were

20)     Reason-respecting – complying with requests merely because we’ve been given a reason. Includes underestimating the power of giving people reasons.

21)     Believing first and doubting later

22)     Memory limitations

23)     Do-something syndrome – acting without a sensible reason

24)     Mental confusion from say-something syndrome

25)     Emotional arousal – hasty judgments under the influence of intense emotions. Exaggerating the emotional impact of future events.

26)     Mental confusion from stress

27)     Mental confusion from physical or psychological pain

28)     Bias from over-influence by the combined effect of many psychological tendencies operating together [lollapalooza]

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Business Partnership Mistakes You Should Avoid

Your ability to succeed and grow your business will be determined largely by how well you learn the art of the business partnership.

I’ve been in deals with great partners, mediocre partners, and terrible partners. I’ve had more than one deal blow up in my face solely because I chose the wrong partners.

Your partners define everything about how successful your business will be.

Good Partner, Bad Partner

I want to show you a framework that my father shared with me for managing a business partnership that he uses as a guiding light (especially in tough times) to determine what to do next in his business.

He calls this “Good Partner, Bad Partner.” It’s not a very complicated way to look at a business partnership, but its power lies in its simplicity.

Business Partnership Grid - Good Partner Bad Partner

Whenever you find yourself struggling with a business partnership, its time to take out the grid and make decision about the best course of action. When I’ve had to agonize over decisions about whether to double down or shut down – this grid has provided me with tremendous clarity.

If you’ll notice – the key factor on the grid is not the quality of the deal itself, but rather the quality of the partners.

Regardless of the economic opportunity, bad partners can sour a good deal. Any deal where you have a bad partner you will likely end up needing to exit the transaction sooner or later.

On the other side of the coin, good partners can save even a bad deal. If you have a good partner the right choice is to stick it out make the business partnership work.

Business Partnership Lessons

The challenge of course is finding and ensuring that you are dealing with good partner first and foremost. You sure can save a lot of headaches (and heartache) on the front end by avoiding these critical business partnership mistakes.

No method for selecting the right business partners this will ever be perfect, but building on the lessons of seasoned entrepreneurs is not a bad place to start.

In that vein, I wanted to share a few insights and lessons that I have learned along the way and a few that I have taken from business people who have seen many more partnerships than me.

Much of this research was put together by veteran entrepreneurs Bill Hammack, the CEO of, and his business partner Lou Zimmers who served as former CFO of Michigan Bell and was a highly successful technology and publishing entrepreneur.

Seasoned businessmen on their own, they also interviewed several entrepreneurs and top executives from the likes of Fortune 500 companies and billion dollar private conglomerates to put these lessons together.

What they found were a striking number of common patterns why business partnerships fail.

Unequal contributions (real or perceived)

Let me repeat that last part – real or PERCEIVED. Even a perceived imbalance can throw a business partnership into chaos. It’s absolutely critical to define the role of each partner in detail and communicate as clearly as possible from the start. Everyone should be on the same page about what expectations are and what each partner is contributing to the deal.

Failure to reduce everything to writing

Everything needs to be “put on the table.” Especially compensation! Give the document to a disinterested party to find poorly defined terms.

Failure to fully define expectations

Expectations are not easy to verbalize. Each person hears it differently (reflecting his or her background and self-interest). You even have to define “Success.”

Partners with different objectives or bad chemistry

Understanding your partners objectives and clearly communicating your own is essential on the front end of any deal.

Lack of integrity.

While it’s impossible to ever truly know if your partner has a lack of integrity, this underscores the reason why its so important to focus on “fit” and getting to know each other before entering into a business partnership.

Poorly Defined “Exit Strategies.”

​How you value the enterprise is always a contentious issue. ​You need to play the “what if” game to identify the possibilities. A failure in a business partnership has some of the same attributes as going through a divorce. Like a divorce, you need to identify what was brought into the relationship and what was created together.

When circumstances change for one of the parties.

A business partnership can sometimes fail when circumstances change for one of the partners (e.g., health, family concerns, etc.). These changes cannot be anticipated. The best that can happen is an evenhanded unwinding of the business partnership. That is why it is critical to define exit strategies up front.

Successful Business Partnerships

So what are the secrets to a successful business partnership? With all of these mistakes in mind, here are a few key things to do to make sure that you start your business partnership off the right way.


There are three kinds of communication. No communication, miscommunication, and over-communication. There is no middle ground. If you are not over-communicating then you are either not communicating or you’re miscommunicating. Period. This applies to a business partnership just as much as it applies to everything else in your life. Don’t beat around the bush. Be as honest and direct with your partner on what you want as possible.

Understand Your Partner

Understanding comes from putting other people first. Focus on providing value for your partner. Spend more time listening than talking. Make sure you understand clearly their goals and objectives.

Fit First / Business Model Later

Get to know each other and focus on “fit” before you dive into the specifics of the business partnership. Learn about your partners on a personal level and the business side of things will flow naturally.

Begin With The End In Mind

To quote the famous lesson from the “Seven Habits of Highly Effective People” – starting with the end in mind helps your business partnership avoid a lot of headaches along the way. Define your exit strategy and your goals up front.

Put Everything In Writing

This comes directly from the mistakes above, but it bears repeating. Fully define your expectations on the front end. Sit down and have a long conversion defining exactly what everyone brings to the business partnership and what their roles and expectations are.

What have your experiences taught you? Have you had success or failure with a business partnership in the past? What was the biggest lesson you learned? Let me everyone know in the comments below.

If you enjoyed this post, I’d be very grateful if you’d help it spread by emailing it to a friend, or sharing it on Twitter or Facebook. Help spread the word about what it takes to make a business partnership successful.

Thank you!

(Lastly, hat tip to entrepreneur Rob Kelly who has another great post on how to create a successful business partnership)


How To Meditate – Learn With Guided Meditation

Matt Bodnar - How To Meditate

Have you ever wanted to learn how to meditate but couldn’t figure out where to start? Should you focus on“guided meditation” or “unguided” meditation? It can be confusing and overwhelming with so many different methods, ideas, and beliefs about what meditation is and how you should perform it.

At a meditation class in central Vietnam last summer I asked the guru leading our session “what kind of meditation are we performing today?” and he looked at me funny and gave me an answer that threw me for a loop. I thought I  knew a decent amount about meditation at the time, but what he said changed my perspective.

When I was 17 I took a trip across Southeast Asia and that’s when my fascination with meditation began. I bought a book on Zen Buddhism and read it on the plane ride home. Since then meditation was always something that fascinated me, but I never knew exactly how to meditate.  I finally started taking a more serious look at how to meditate a few years ago when I saw that Tim Ferriss meditates every morning.

“Mindfulness” and Being Present

I first started out almost by a whim. I randomly decided to search the phrase “zen garden” on Pandora and ended up with a pretty cool radio of relaxation and meditation music. I was just working peacefully and then I got this really strong urge to just sit down and meditate (having no idea how to meditate or what I was doing).

I had no agenda or plan. I just sat in a loose lotus position (similar to the picture at the start of this post), closed my eyes, and tried to be present and practice “mindfulness” for about 15 minutes. When I first read about how to meditate – so much of the information was about things like “mindfulness” and I wasn’t sure what that even meant, let alone how to practice it.

This impromptu meditation got me into the habit of listening to really soothing zen and meditation music (I’ll share some of my absolute favorite meditation music at the end of this post) a few times a week and practicing what I would later learn was “unguided” meditation.

When I was doing this sort of “unguided” meditation – just trying to clear my thoughts and “be present” (that’s another buzz word you hear a lot when trying to learn how to meditate) I did experience a few moments of euphoria and out of body experiences – but mostly my mind just wandered and I would sometimes feel like I was wasting my time.

You’ve probably had the same problem if you’ve tried to learn how to meditate before, but I could never get fully into the habit of meditation. I would go days or weeks without meditating, and sometimes when I did meditate I felt like I wasn’t really accomplishing anything.

So what was I doing wrong? The good news is – as the  guru leading my meditation class in Vietnam last summer told me – there is no “right way” to meditate. It’s all about what works best for you.

My path of infrequent meditation lasted for a few years before I discovered how to meditate with a method that – at least for me –finally felt “right.”

The Envisioning Method

While on Mixergy, I stumbled upon an absolutely awesome interview with Vishen Lakihani, the founder of MindValley, about how he launched his business. During the interview he went in depth into his daily meditation practice that he calls the “The Envisioning Method” and how it changed his life.

This method is a bit different than the traditional sort of meditation that you’ve heard about before – its not about “mindfulness” or being present – its a kind of guided meditation and each of its six phases are rooted in the science of positive psychology in order to increase happiness, relieve stress, and leave you more focused and energetic.

Vishen is quick to point out that getting caught up in a debate about the definition of meditation is not important. If you want to learn how to meditate – its all about finding a good starting point. This may not fall under traditional definitions of meditation – but the reality is that this method can have a tremendous positive impact on your life – whether your call it meditation or not.

I won’t go into great detail of how this method works – MindValley put together a really well done 20 minute video explaining the entire process – along with a starter mp3 that will guide you through the process until you are familiar with how to do it yourself – all of which you can get for free on this page (note: you do have to put in your email).

The whole process takes between 10 and 20 minutes. To give you a basic overview – the six phases are the following:

  1. Connectedness (Compassion)

  2. Gratitude

  3. Forgiveness

  4. Visualize Your Future

  5. Visualize Your Perfect Day

  6. The Blessing

Honestly every phase has made a huge impact in my life – I think the three most important have been gratitude, forgiveness, and visualizing my future.


If you have never read or heard about gratitude studies in positive psychology –do a few Google searches and research this more on your own.

There is an amazing study that even one week of daily gratitude practice can raise your “happiness set point” 10% up to six months in the future. Even if you don’t use this meditation method – I highly recommend starting some sort of daily gratitude practice.


The practice of daily forgiveness has also had a tremendous impact on me by letting me take responsibility for my happiness instead of having it rely on external events.

“The weak cannot forgive, forgiveness is an attribute of the strong” – Ghandi

When you look at people who have literally changed our world – like Ghandi and Nelson Mandela – they are showcases for the true power of forgiveness. But the reality is (and science backs this up) – harboring grudges instead of forgiving is bad for you – both mentally and physically.


The process of visualization opens up your mind (and more importantly – your subconscious) – to seeing new pathways and opportunities that you would never have dreamed of.

Conditioning your subconscious to believe and accept the new possibilities opens them up as a reality and gives you the subconscious permission to make progress on your biggest goals and dreams.

Meditation Music

When I meditate, I like to listen to very soothing and chill music to center my mind and help me focus. Getting the right music can really help you when you’re starting to learn how to meditate.

My favorite artists to meditate to are David & Steve Gordon. I absolutely love their albums “Garden of Serenity II,” “Gratitude,” and “Music for Meditation – Inner Stillness.” Sometimes the song names can get a little goofy but the music itself is really peaceful and soothing – and most importantly perfect meditation music.

Most of their songs are available on Spotify (except for my absolute favorite song “Zen Garden, Part 1”… yes I bought their CD just for this track) and I’ve linked a few of them on Myspace and GrooveShark so you can have a listen below.

Music for Meditation – Inner Stillness

Zen Garden

If you like this kind of meditation music – just search around on Spotify or Pandora and you can find all kinds of great tracks to help you relax and focus your mind.

The meditation music helps you center yourself no matter when or where you decided to meditate. When I’m on the road I just plug some headphones in and meditate on the floor of my hotel (or wherever I am staying) when I get up.

How To Meditate For Beginners

Learning how to meditate can be confusing, but if you are serious about trying meditation out in your life you should give the envisioning method a shot. This meditation method has really made a huge difference for me and I finally feel like I’ve found the “right” method for myself.

At the end of the day – if you want to learn how to meditate – you have to find a meditation method that is right for you too.

Vishen’s “Envisioning Method” is an absolutely great place to start with some simple and impactful guided meditation. You don’t need to do anything other than que up some great music and listen to his guided MP3 a few times until you have the process down. At the start it will take about 20 minutes per day, but once you have the process memorized you can squeeze in a 10 or 15 minute session when are shorter on time.

Like any new habit – I recommend trying this out for 5 days in a row to see if you like it. If you can make it that far, chances are you will stick with it (and reap all the awesome benefits).

Another great tool for keeping yourself accountable on a daily basis is – there are a number of simple meditation plans you can sign up for and check in daily.

Thanks you for reading this and I hope you discovered how to meditate and what you can do to start meditation today.

If you love meditation and you want to take your mental game to the next level – you should read this post on three things that will shift your reality.

Three Big Ideas That Will Change Your Reality

Transform your reality.

I believe in constantly challenging my assumptions, thinking outside the box, and pushing myself to the limit of transformation – constantly expanding my horizons both mentally and physically.

In the last 60 days I have completely transformed my perception of myself, reality, and the world.

In November I  joined “The Foundation” – a 6 month online mentoring program for software startups. As you may notice from some of my older posts here, I have been a huge fan of the ideas of Dane Maxwell for a long time.

Dane has one of the most unique ways of the looking at the world (much the same reason that I like Tim Ferriss) and he takes a lot of this unconventional thought to a whole new level – well beyond even the awakening I had after reading the 4HWW for the first time.

After emailing this list of links out to friends again and again, I decided that I needed to put them in a blog post so I could share these eye opening ideas with as many people as possible.

Here are three “big ideas” that I have taken away from The Foundation. I wanted to share with you a few podcasts, videos and interviews that encapsulate each of these concepts.

Focus On Changing Your Mindset First

“If you play the game at the belief level, everything shifts.” – Dane Maxwell

The single biggest and most important takeaway for me was to focus on understanding and eliminating my limiting beliefs. This single shift, which requires some seriously deep emotional thinking, has transformed the way that I act and think about the world.

“The framework is this:

The beliefs you have lead to the feelings you feel.

The feelings you feel lead to the thoughts you think.

The thoughts you think lead to the actions you take.

The actions you take lead to the results you get.

So, instead of focusing just on the actions or the thoughts – go to your deepest level – your beliefs about the world – make one minor shift in your beliefs and you will see a ripple effect on everything in your life.”

– Andy Drish

If you check out nothing else from this post, listen to this podcast immediately. This one hour podcast really sums up most of the core lessons that I have taken away from Andy and Dane at the Foundation – and has a big discussion about limiting beliefs that opened my eyes to the power of uncovering and demolishing your limits.

If you want to find out more specifics on reversing and breaking down limiting beliefs, check out this 30 minute video where Dane explains the process.

I have also included a few more links at the end of this post for those who want to do a deeper dive into discovering their own limiting beliefs.

Forget ‘Finding Your Passion’

Do you struggle with the notion of finding your passion? Do you waffle around between ideas or keep waiting until you find that perfect fit where you will be in harmony with what you are doing?

“Because of.. the myth that you have to be passionate about your idea to do it. My thought is most successful entrepreneurs have done so many different things. You couldn’t even point to what their passion is.” – Hiten Shah

The whole concept creates a tremendous amount of frustration, confusion and dissatisfaction. Instead, highly successful software entrepreneur Hiten Shah (founder of Kiss Metrics) says – optimize for learning and forget trying to find your passion.

“I would just emphasize what you want to learn about. If you want to learn about marketing because you think it’s really important to any idea then just go learn about marketing and try different things and you’ll pretty much find what you’re aligned with, right? If you’re really dying to build software online and build software as a service products or learn how to program because you think that that’s what you need to do then just go learn it. Just start learning. Figure out what you think you’re most attracted to and start learning it.” – Hiten Shah

Focusing on learning removes fear and ego from the equation – it creates a path forward and a framework for you to stay resilient even in tough times.

If you’re optimizing for learning fear doesn’t come into the equation because you’re always seeking new things, seeking how to do something better, seeking the best way to do it, seeking the knowledge and so fear isn’t even part of the equation, it’s not even the thought that comes to mind because you’re like, “Well, how can I learn how to do that?”  -Hiten Shah

Here’s the full interview with Andy Drish and Hiten Shah. One of my business partners told me that listening to this interview was one of the single biggest turning points in his business career – I highly recommend checking it out.

Take Action, Quickly and Often

One of the largest mistakes you can make is not taking enough action – even if you are unsure what direction you are moving in (isn’t that the essence of being an entrepreneur anyway?).

“Recklessly take action on everything. If you wait to feel good before you take action, you’re totally screwed” – Dane Maxwell

To be a successful entrepreneur you have to have an action bias. Peter Shallard “the shrink for entrepreneurs” breaks down the reasons behind this philosophy in this great one hour interview with Andy Drish.

“Focus on [] relentlessly trying to shorten the gap between having an idea and acting on it. … There’s certain things in business that school, high school and your parents just won’t prepare you for. And college won’t prepare you for. Nothing will prepare you for other than doing it. The biggest problem I see is that people have these ideas. They’re like, “Oh, I should try this,” like X, Y, Z marketing tactic or “I should build a website or whatever,” and then they think about it and trying to decide whether or not it’s right; whether or not the strategy is correct.

They really are thinking about strategy very, very carefully. But when you’re just starting out I think that you should road test everything. Any idea that you have should be implemented as quickly as possible and then you make your deductions based on real world results. Experiential data rather than kind of sitting there brainstorming and doing planning. In a way what I’m saying is kind of to over exaggerate it. Don’t plan anything, just do a bunch of stuff.” – Peter Shallard

That’s pretty powerful stuff right? The phase “relentlessly shorten the gap between ideas and action” has become a huge focus for me.

Here is an amazing video with Noah Kagan (founder of App Sumo) and Tim Ferriss (one of my favorite authors of all time) where Noah shows in real time how quickly you can break down an idea and take meaningful action – instead of pretending to make progress. I’m still amazed every time I watch this video, the clarity of thought that Noah brings to the table is just astounding.

Extra Credit – More on Removing Limiting Beliefs

Here are a few more resources for digging deeper on the limiting belief front.

More on the the “Four Questions” for reversing limiting beliefs, this framework is originally from renowned psychologist Byron Katie.

These 2 posts by entrepreneur Rob Scott are also fantastic resources on how our mindset impacts our thoughts and actions and how we have to focus on shifting our subconscious before we do anything else. Rob’s work within the Foundation was one of the most powerful things I have experienced so far.

Mindset is the most important thing.

The power of the subconscious. (this video is eye-opening if you ever feel like you’ve been stuck in a rut)

Thank You

Thank you so much for reading this post. I really hope some of these ideas have as profound an impact for you as they have had for me.

Here’s a quick recap of the three big ideas:

  1. Shift your mindset first

  2. Optimize for learning

  3. Shorten the gap between ideas and actions

If you even start implementing one of them in your life it could have a huge impact.

If you’re looking for a few books that also fit within this eye opening worldview, I would highly recommend checking this post out as well.

Thank you again for reading.

Image credit to Hartwig HKD on Flickr.

The Best Books I Read In 2013


I hope you like my new video content about the best books I read in 2013. Below is the list of books, the links are affiliate links to Amazon.

Paper Books


Kindle Books




Here are a few other links to some of the other things I mentioned in my video. Hope you enjoy!

Really cool NPR interview with Paul Davies of Cosmic Jackpot.

Here is a link to Rob Kelly’s Blog (the book I was waving around at the start of the video).

My recent blog post about my favorite quotes from The Launchpad (yay Kindle).

Thanks again for reading my blog.


Do Less, Achieve More – The Personal Operating System

standing on the edge

“I’m swamped! So much to do and so little time! I’m never going to get it all done.” 

Sound familiar?

Take a step back from the precipice my friend.

“Being busy is a form of laziness, lazy thinking and indiscriminate action. The key to not feeling rushed is remembering that lack of time is actually a lack of priorities.” – Tim Ferriss

I’m just as lazy and unfocused as anyone else. Sometimes I can barely get anything done. I get sidetracked. I play too many video games. But I also accomplish much more than the average person. It’s not because I’m smarter or better or more motivated, it’s because I have a system that compensates for my laziness.

It’s called a Personal Operating System. It’s a set of rules and principles that govern my behavior. Systems are essential to running a successful business, why wouldn’t you also implement a system to run your life?

My Personal Operating System is based around a few core principles for maximizing productivity and output.

  • Schedule and ritual are essential to free working memory and avoid decision fatigue – automate the unimportant areas of life and save your creativity and decision making power for the few important and high impact items.
  • A personal operating system helps compensate for lack of productivity or motivation. A good system lets you recover and ensures that the few things you do accomplish have the highest leverage impact possible.
  • You have to get good at letting the little bad things happen or wait, so you can get the big things done. It’s not because I don’t have the time. This is a really important distinction – it is because I don’t have the attention.
  • Perform a regularly scheduled 80/20 analysis. Your to-do list should be only the highest leverage positive 20%; your not-to-do list should be to avoid the most negative 20% of people and activities. More on how to perform an 80/20 analysis.
  • Focus on eliminating as much as possible before doing more. What are the psychic anchors tethering me to the ground and creating stress?

The message is simple – focus on scheduling and automating as much as possible, zero in your activity on the highest leverage things you are doing, and cut out the rest.

I crunched my Operating System down into a one page PDF.  It’s part motivational quotes, part philosophy, and all about getting the right things done.

I review these principles first thing every Monday morning when I wake up. I also have a print-out pinned to my wall. I pull it out and read it over whenever I feel like I am losing focus or not accomplishing what I want.

You can download the PDF right here.

If you want to learn more about the philosophies underpinning my Personal Operating System, I highly recommend checking out the blog of Tim Ferriss and in particular a fantastic Mixergy interview he did recently that flushes out many of these ideas in more depth.

Image  Credit to Simon Harrod on Flickr.

How To Perform An 80/20 Analysis

Want to be more productive? Start by cutting out wasted time and focusing on the few highest leverage activities you can.

Sounds great, right? The problem is, of course, how do you actually DO that? The cornerstone of productivity is having simple and easy processes that enable you to follow through and pick back up when you slip.

One of the things I perform on a regularly scheduled basis is an “80/20 Analysis” of everything in my life.

If you’re unfamiliar with the 80/20 rule, also known as the Pareto Principle, check out this great article on Lifehacker about it. The core message is that most things we do are largely irrelevant and the “vital few” have an outsized impact on our lives.

Performing a regular 80/20 analysis has been an invaluable tool for me, and I wanted to share the template that I use to organize my own thoughts whenever I perform one.


Mindset is one of the most critical elements of success. You absolutely have to get your mindset right first. Tony Robbins frequently says that more than 80% of success is psychology. Here are some great quotes from Tim Ferriss to help you get your mind in the right place to conduct an 80/20 analysis.

“The goal is to find your inefficiencies in order to eliminate them and to find your strengths so you can multiply them.” – Tim Ferriss

“Simplicity requires ruthlessness.” Tim Ferriss

Do 80/20 analysis constantly, so to analyze also the 20% of people or activities that are creating 80+% of my stress, consuming 80+% of my time, and as is almost always the case, the stuff that was consuming the most time did not overlap very much with the 20% that was most important.

On a regular schedule you’ll sit and do that 80/20 analysis and ask yourself what’s the 20% of my life that’s getting me the most impact, the 80% impact, and how do I stop doing the rest.

Look at the 20% that are the highest leverage positive things and I’ll focus on those. I’ll look at then the 20% most negative things that are consuming the most time, and try to eliminate those. There’s quite a bit in-between that in the end, often takes care of itself, but really keeping your eye ball of your to-do list are the 80-20 positive, and the not-to-do list for the 80-20 negative is huge. 

When I’m really feeling overwhelmed, I actually focus on the negative, which is a good thing. I focus on eliminating as much as possible before I focus on doing more. What can I get rid of? What are the psychic anchors, which are like, tethering me to the ground where I’m trying to sprint forward, but I’m just dragging this weight behind me. I focus on a massive elimination first. I try to remove as much as possible so that I have fewer moving pieces to think about. So elimination is a huge part of why I get anything done.”

Tim Ferriss


  •  Mute Cell Phone
  •  Close Outlook
  •  Close Chrome (or any other Browser)
  •  Take out a pad of Graph Paper


Ask each question and brainstorm / write the answers down BY HAND on a sheet of paper. 


  • What 20% of sources are creating 80% of my problems and unhappiness?
  • What 20% of sources are resulting in 80% or my desired outcomes & happiness?


  • What 20% of sources are creating 80% of my problems and unhappiness?
  • What 20% of sources are resulting in 80% or my desired outcomes & happiness?


  • If I was completely incapacitated and had to work two hours per day – what would I focus on?
  • If I was even more incapacitated and had to work two hours per WEEK – what would I focus on getting done?
  • What are the top three activities I use to fill time to feel as though I’ve been productive? What are my CRUTCH activities?
  • When do I feel STARVED FOR TIME? What commitments, thoughts, and people can I eliminate to fix this problem?


  • 20% highest leverage positive things -> Defines TO DO LIST
  • 20% most negative things (eliminate) -> Defines NOT TO DO LIST
  • What is the financial impact (or other impact) of these activities?
  • Can these activities be eliminated? How?
  • Can these activities be delegated? How?
  • Can these activities be automated? How?
  • Define CONCRETE steps (especially next steps) for how to do each of the above.
  • Focus on eliminating as much as possible FIRST.


I made this into a downloadable PDF copy that you can get here if you want one for yourself.

Many of these quotes and ideas are from the blog of author Tim Ferriss and recent interview he did on which I highly recommend checking out.

Hope you enjoyed this post and that it helps you become more productive.

29 Lessons from Paul Graham & Y Combinator – Advice for Startups

Hacker News was originally recommended to me by this crazy Czech guy named Jan Sramek. Jan flew in from London to New York and happened to be in my training class when I first started working at Goldman.

Jan, who is currently one of the founders of a stealth mode startup in Switzerland called Erudify, was sort of an oddity to us. Not only had Jan already written a Self Help Book by the ripe age of 22, but he also seemed to have an entire PR team lauding all these wild feats and accomplishments he had achieved in the UK during his undergrad years.

I knew he was a pretty smart guy and I would always pick his brain about what he was reading, thinking, etc.  One day I asked him if he knew any good blogs to read. I was bored and looking for some good stuff other than mashing refresh on the WSJ website and Bloomberg over and over again.

That happened to be one of the most fortuitous questions I’ve ever asked in my life. Not only did Jan recommend Tim Ferriss’s blog to me but he also shared Hacker News.

I still remember sitting at my desk as all the blog posts and news stories on Hacker News filled my head with entrepreneurial daydreams. Meanwhile I was stuck sitting there 14 hours a day with my eyes glued to the markets.

Since Y Combinator runs Hacker News, I instantly wanted to read the book “The Launch Pad: Inside Y Combinator, Silicon Valley’s Most Exclusive School for Startups” as soon as I heard about it.

Launch Pad is a quick read and I definitely recommend it for anyone interested in startup life or wanting to learn more. I learned a ton about Y Combinator and a bunch of its companies (Rap Genius and Code Academy are two that I discovered – and both kick ass).

Below are all of my Kindle highlights (29 in total) from the book.  I wanted to share them to give you a taste of what the book is like.

The twenty-five-year-old had the most advantages, which included “stamina, poverty, rootlessness, colleagues, and ignorance.”

If you’re not fully focusing on your product to the exclusion of all else, you’re wasting your time.

“There’s so much luck involved with startups you increase your odds of success by swinging the bat multiple times. Each time you do something that isn’t swinging the bat, you theoretically decrease your odds of success,”

No one asked ‘Should we fix payments, or build a recipe site?’ and chose the recipe site. Though the idea of fixing payments was right there in plain sight, they never saw it, because their unconscious mind shrank from the complications involved. You’d have to make deals with banks. How do you do that? Plus you’re moving money, so you’re going to have to deal with fraud, and people trying to break into your servers. Plus there are probably all sorts of regulations to comply with. It’s a lot more intimidating to start a startup like this than a recipe site. When Patrick Collison was asked what he thought about Graham’s point about the intimidating nature of a big problem, Collison politely dissented, arguing that what should be emphasized was that addressing a hard-to-solve problem is actually not as hard as everyone thinks: founders and employees alike are inspired to work harder than if they were taking on the mundane. [Referencing Stripe]

One’s environment is critically important to one’s productivity.

“Here’s how to generate new ideas. Three things. One: founders are target users. Two: not many people could build it, but founders are among them. Three: few people realize it is a big deal.”

“Ask yourself: ‘What do I wish someone would start a startup to do for me?’” says Graham. “The next best thing: something for someone else that you know is a problem.”

The best kind of thing to work on – and I appreciate this is going to be somewhat abstract or higher-level advice – the thing you want to work on is, there’s this need that’s really clear and you can just launch some shitty site and people just start using it.

Friends can mislead, Taggar says. His advice: address what businesses need, not what consumers say they would use.

“One of the big things they focus on is ‘proxy for demand.’ Which basically means when looking at some new idea, they want to see what people are doing at the moment? What kinds of crappy solutions are they hacking together at the moment.” They’ll ask founders who are building a product what their future users are doing right now. “If the answer is, ‘No one is really doing it at the moment’—a lot of people think that’s a good answer, but it’s not. Because it means they’re not desperate for it.”

“If you’re not embarrassed by the first version of the product you’ve launched, you’ve launched too late.”

He suggests that startups set a specific weekly target for growth, which can be measured in terms of revenue or users or something else, but should be essential to the startup. Anything that is not directly related to that metric is to be pushed to the wayside.

“I’m always a fan of, rather than trying to do huge, radical releases of stuff, just test out theories, the easy, simple way, and just see if anything starts happening,”

“The gold standard of weekly revenue growth is 10 percent a week. That’s insanely high. That works out to 142x a year.”

This is a strange question to pose, because, in startup life, commitment comes in only one size: total.

“They don’t fuck around, right? The startups that succeed, they don’t go to meet-ups, they don’t run around talking to boards of advisers, they just write code and talk to customers, right?” This is Graham’s oft-repeated mantra, too. Write code and talk to customers.

“We did it because we want their software to be good,” he explained. He mocked the “professional” notion that work and life are supposed to occupy separate spheres. In a startup that begins in an apartment, the founders work odd hours, wearing the most casual of clothing. They look at whatever they want online without worrying whether it’s “work safe.” The cheery, bland language of the office is replaced by wicked humor. And you know what? The company at this stage is probably the most productive it’s ever going to be.

In the YC universe, business schools are deemed so useless that no one bothers to expend any energy in remarking upon their irrelevance to software startups. The only question relating to formal education that does draw attention is whether to finish or even go to college.

Only to the basic YC tenets: work on code and talk with customers; launch fast and iterate; focus on one measurable weekly goal.

“The way to get really big returns is to do things that seem crazy,” he wrote in 2007, “like starting a new search engine in 1998, or turning down a billion-dollar acquisition offer”—a reference to Facebook.

“It will all come to what they feel in their gut about you guys as founders. If you seem”—he pauses again—“you know, fearsome, like you’re going to take over the world, then they’ll think, ‘OK, these guys are going to take over the world, and there’s definitely a world here for them to take over,’ right?”

The transition that makes people seem more confident, more resourceful, and tough—right?—that’s what you get out.

The YC User’s Manual tells founders that even in the very best case, when an investor is paying close attention, information equivalent to only four or five sentences will be absorbed from a presentation seen for the first time. One of the sentences should be a genuine insight, something that will surprise—“If a statement is not surprising, it’s probably not an insight,” the manual says. Investors may remember far less of the presentation than this, however. A single noun may be all that sticks in the mind afterward. “Something to do with chat.” “Something to do with databases.” The manual says about a third of the startups on Demo Day will do no better than this.

A lot of things broke. But a lot of things always break. So we’re going to fix the things that break.” He tries out a joke: “And then more things will break.

In YC’s portfolio “the number one company is worth more than the next 199 companies combined, while number two is worth more than the next 198 combined, and so on.”

[To be a billion dollar company] “One: you really need a huge market. And two: you need founder-market fit.”

“Just focus on one of three things: One, be cheaper. Two, focus on a niche. Or, three, be 10x better than the other products out there.”

“The point of this story is that you guys need to have this kind of swag. You need to suck people, and especially investors, into your own reality.” He heads into the conclusion. “So, what have we learned? One. You’ve got to put yourself out there and meet people, even if it’s awkward. Two. You’ve got to hug your cofounders and love your batchmates. Three. Experts aren’t going to help you solve your problems. Four. You’ve gotta have swag.”

“Smart people by definition have odd ideas.”

Hope you enjoyed and as always – hit me up on Twitter.


How Taziki’s Leapt From Three to Twenty Stores in Under Five Years

How did Fresh Hospitality take Taziki’s from a local favorite with three locations to #32 on the Fast Casual Top 100 Movers & Shakers with more than 20 locations now open?

I recently shared this entire story (and much more) on a panel at the Fast Casual Executive Summit.

Our panel told the story of Taziki’s fast paced growth by looking at how Fresh Hospitality used systems and technology to create a rapidly scalable brand.  The full panel is embedded below (40 minutes) as well as my particular portion (~10 minutes) focusing specifically on how critical systems and technology are to scalability and growth.  I’ve also embedded the slide deck that we used for the presentation as well.

(Forgive the video & sound quality – this was recorded on an iPhone!)

Systems Are Essential to Scalability & Growth (me)

Restaurant Management Systems (full panel)

The Taziki’s Story (slide deck)


Hope you enjoy and as always – would love to follow up and chat more on Twitter!