How to Make Wealth  by Paul Graham (an essayist, programmer, and programming language designer) was written in May 2004.  It is very much in-line with some of the wealth and asset creation topics I have been discussing lately-- I thought I would share it with you.

While the essay is a long read (that should be read at least twice), it is well worth it.  I hope the following verbatim excerpts (my personal take aways) inspire you to read the essay and learn from it:

• Economically, you can think of a startup as a way to compress your whole working life into a few years. Instead of working at a low intensity for forty years, you work as hard as you possibly can for four.
• Startups are not magic. They don't change the laws of wealth creation. They just represent a point at the far end of the curve. There is a conservation law at work here: if you want to make a million dollars, you have to endure a million dollars' worth of pain.
• There is a large random factor in the success of any company. So the guys you end up reading about in the papers are the ones who are very smart, totally dedicated, and win the lottery.
• Wealth is the fundamental thing. Wealth is stuff we want: food, clothes, houses, cars, gadgets, travel to interesting places, and so on. You can have wealth without having money. If you had a magic machine that could on command make you a car or cook you dinner or do your laundry, or do anything else you wanted, you wouldn't need money.
• Suppose you own a beat-up old car. Instead of sitting on your butt next summer, you could spend the time restoring your car to pristine condition. In doing so you create wealth.
• The people most likely to grasp that wealth can be created are the ones who are good at making things, the craftsmen. Their hand-made objects become store-bought ones. But with the rise of industrialization there are fewer and fewer craftsmen. One of the biggest remaining groups is computer programmers.
• A programmer can sit down in front of a computer and create wealth. A good piece of software is, in itself, a valuable thing.
• Someone graduating from college thinks, and is told, that he needs to get a job, as if the important thing were becoming a member of an institution. A more direct way to put it would be: you need to start doing something people want. You don't need to join a company to do that. All a company is a group of people working together to do something people want. It's doing something people want that matters, not joining the group.
• You can't go to your boss and say, I'd like to start working ten times as hard, so will you please pay me ten times as much? For one thing, the official fiction is that you are already working as hard as you can. But a more serious problem is that the company has no way of measuring the value of your work.
• There is one other job besides sales where big companies can hire first-rate people: in the top management jobs. And for the same reason: their performance can be measured.
• To get rich you need to get yourself in a situation with two things, measurement and leverage. You need to be in a position where your performance can be measured, or there is no way to get paid more by doing more. And you have to have leverage, in the sense that the decisions you make have a big effect.
• If you're in a job that feels safe, you are not going to get rich, because if there is no danger there is almost certainly no leverage.
• A big company is like a giant galley driven by a thousand rowers. Two things keep the speed of the galley down. One is that individual rowers don't see any result from working harder. The other is that, in a group of a thousand people, the average rower is likely to be pretty average.
• Startups offer anyone a way to be in a situation with measurement and leverage. They allow measurement because they're small, and they offer leverage because they make money by inventing new technology.
• If you look at history, it seems that most people who got rich by creating wealth did it by developing new technology.
• Here, as so often, the best defense is a good offense. If you can develop technology that's simply too hard for competitors to duplicate, you don't need to rely on other defenses. Start by picking a hard problem, and then at every decision point, take the harder choice.
• For most people, the most powerful motivator is not the hope of gain, but the fear of loss.

Related Posts:
Creating Income Producing Assets
Wealth Creation and "Assets"
Passive or Residual Income
Bulletproof Yourself . . .
New Product/Service Ideas
Why Do We Only Prepare or Act After a Problem or Disaster? 
Progress Over Perfection