LEVERAGE — This is everywhere in life, but only a few can identify it.

What is the leverage?

In Physics, I learned a unique concept. If you want to move a heavy load, you can use a fulcrum as support and put in effort using a lever.

“Give me a lever long enough and a fulcrum on which to place it, and I will move the world.” – Archimedes.

So lever is a "leverage" because without it, you cannot move the heavy load.

Leverage

For example

• A screwdriver is a form of leverage used to move the screw in/out of the hole.

• A book is a form of leverage used to teach you something from another person's knowledge.

I can say that in the modern world, we find a lot of leverage that you can use to gain an advantage by following:

• Knowledge through the Internet

• Buying / Selling Stocks through Digital Apps

• News on the go because of Twitter

The question is why I should know about the leverage?

This is the question I also thought about.

Let's take a hypothetical scenario

Suppose I am standing in a plain field seeing the Sun rise around 6,000 BC. My first thought was what to eat because now I am hungry.

I started looking around everywhere.

Then I see an Apple Tree.

I need to go up to get the Apple, or I should look around to use a stone to throw at the Apple.

Then I climbed up and got my Apple.

Now, after 3 hours, I am again feeling hungry; this time, I want to eat Meat.

For that, I need a tool.

To make a Tool, I either spend my time building from scratch or find one from someone.

If I make it by myself, I need a lot of time with trial and error.

But if I get help from someone who made it. That is Leverage

Because someone spent their time building the tool, and I am only using it for my hunting purposes.

In a nutshell, we all need leverage.

Examples of Leverage

Since my early years, I have known only these two types of leverage.

1. Physics Leverage: The oldest leverage is when a Lever and a Fulcrum are used to move a load.

   
   

2. Finance Leverage: When you use money from the bank to buy something.

Four Forms of Leverage

One day, I read a quote from a modern philosopher, Naval Ravikant, on the internet

"In the Age of Infinite leverage, Judgment is the most important Skills."

He further explained Leverage into 4 forms

• Labour: Spending your time. (Oldest). Everyone has access to it.

• Capital: Use other people's time using money. (Older) Only the rich have access to it.

• Media: Use digital media to do something to get something (Newer).

• Code: Use software to do something. (Newest)

“The one who leverages the markets is an entrepreneur. The one who leverages the mobs is a politician.” - Venkat

Background of Leverage

In the last 500 years, a third form of leverage emerged, the Media (Paper Printing) in around 1456 AD in Italy.

Because of this knowledge spread widely. Before this knowledge and information were sitting in the minds of people.

Conclusion

So if you want to be successful, you need to use how to use leverage.

• Want a new car - leverage capital using a car loan.

• Want to get things done - leverage a labour to pay rate cheaper than your hourly rate.

• Want to be wealthy - leverage a business where you sell a product

“If you don't have leverage, you're never going to make real wealth.” - Naval Ravikant

Remember, your time is finite and cannot be leveraged.  You must know how to use leverage to make wealth

To improve the OUTPUT: increase the Leverage (input-to-output ratio). Keep searching for high numbers of leverage in life to use in your favour.

Stay tuned next time.