Knowledge as Leverage
Naval Ravikant distinguishes between different types of leverage: labor, capital, and products with no marginal cost of replication (code and media).
There's another form: knowledge leverage.
The Compound Effect of Expertise
Expertise compounds. Each layer of knowledge makes the next layer easier to acquire. Connections form. Patterns emerge. What once took weeks to understand takes hours.
This creates acceleration that's hard to compete with.
Choosing What to Learn
Not all knowledge is equally leveraged. Consider:
Foundational vs. Trending
Foundational knowledge (principles, mental models, first-order thinking) applies across contexts and time. It's maximally leveraged.
Trending knowledge (specific tools, current best practices) has a shorter shelf life. Sometimes necessary, but less leveraged.
Rare vs. Common
Knowledge that's rare and valuable commands premium. Common knowledge is table stakes.
The intersection of "rare" and "foundational" is where leverage lives.
Combinable vs. Isolated
Knowledge that combines with other knowledge creates unique value. The developer who understands design. The marketer who can code. The manager who grasps finance.
Combinations are hard to replicate.
Building Your Knowledge Portfolio
Think of knowledge like an investment portfolio:
Blue chips: Foundational skills in your core domain. Safe, essential, slow-growing.
Growth bets: Adjacent skills that could multiply your value. Higher risk, higher reward.
Exploration: Random walks through unrelated fields. Most won't pay off, but the ones that do can be transformative.
Diversify intentionally.
The Execution Gap
Knowledge without application isn't leverage—it's trivia.
The gap between knowing and doing is where most people lose their advantage. Close the gap through:
- Immediate application of new concepts
- Teaching others (forces understanding)
- Building projects that require your knowledge
Playing Long Games
Knowledge leverage requires patience. You're building an asset that appreciates over decades.
The compound returns don't show up in year one. They show up in year ten, when everything you've learned connects into a unique perspective no one else has.
Play long games with long-term people.