Richard Koch — Revisiting the 80/20 Principle, The Power of Optimistic Journaling, Studying History to Improve Investing, and The Grand Beliefs of Winners (Plus: The Toxic Beliefs of Losers) (#680)
Illustration via 99designs“M. Scott Peck wrote a book which starts, ‘Life is difficult.’ This is one of the great things about life. If you understand this, you can transcend it, because you anticipate that things are going to be difficult, and you can take pride in overcoming difficulties. But if you expect there are going to be no difficulties, obviously you are going to be disillusioned.”
— Richard Koch
Richard Koch (@RichardKoch8020) is an entrepreneur, investor, former strategy consultant, and author of several books on business and ideas, including four on how to apply the 80/20 principle in all walks of life.
His investments have grown at 22 percent compounded annually over 37 years and have included Filofax, Plymouth Gin, Belgo, Betfair, FanDuel, and Auto1. He has worked for Boston Consulting Group and was a partner at Bain & Co. before joining Jim Lawrence and Iain Evans to start LEK, which expanded from three to 350 professionals during the six years Richard was there.
In 1997, Richard’s book The 80/20 Principle reinterpreted the Pareto Rule—which states that most results come from a small minority of causes—and extended it beyond its well-known application in business into personal life, happiness, and success. The book, rewritten in 2022, has sold more than a million copies, been translated into roughly 40 languages, and has become a business classic. It was named by GQ as one of the top 25 business books of all time. Richard’s latest book is Unreasonable Success and How to Achieve It.
He has two upcoming books: 80/20 Beliefs, which identifies the very few beliefs in our lives that strongly influence what we do, and, therefore, the results we get, as well as 80/20 Daily, a collection of 365 short daily readings using the 80/20 philosophy to achieve the good life.
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Listen onApple Podcasts[image error]Listen onSpotify[image error]Listen onOvercast#680: Richard Koch — Revisiting the 80/20 Principle, The Power of Optimistic Journaling, Studying History to Improve Investing, and The Grand Beliefs of Winners (Plus: The Toxic Beliefs of Losers)This episode is brought to you by Secureframe! Secureframe’s industry-leading compliance automation platform, paired with their in-house compliance experts and former auditors, helps you get audit-ready in weeks, not months, so you can close more deals faster.
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Want to hear the last time Richard Koch was on the show? Listen here to our conversation in which we discussed investing for the mathematically challenged, Oxford Bodleian Library secrets, writing The 80/20 Principle, optimizing happiness, different journaling styles, nine landmarks of successful people, Nelson Mandela’s unique intuition, and much more.
#466: Richard Koch on Mastering the 80/20 Principle, Achieving Unreasonable Success, and the Art of GamblingWhat was your favorite quote or lesson from this episode? Please let me know in the comments.
SCROLL BELOW FOR LINKS AND SHOW NOTES…
SELECTED LINKS FROM THE EPISODEConnect with Richard Koch:THE OXFORD EXPERIENCE at WADHAM COLLEGE, OXFORD | Contact formRichard Koch on Mastering the 80/20 Principle, Achieving Unreasonable Success, and the Art of Gambling | The Tim Ferriss Show #466Unreasonable Success and How to Achieve It: Unlocking the 9 Secrets of People Who Changed the World by Richard Koch | AmazonThe 80/20 Principle: The Secret to Achieving More with Less by Richard Koch | AmazonThe Simplest Way to Talk about Location | What3WordsGlastonbury Festival of Contemporary Performing ArtsFear-Setting: The Most Valuable Exercise I Do Every Month | Tim FerrissHow to Increase Your Luck Surface Area | Codus OperandiTranche: Definition in Finance, Purposes, and Examples | InvestopediaBetfair | WikipediaBookmaker | WikipediaWhat Is Vig and Overround? | Matter of StatsFilofax Company Turnaround Strategy (Richard Koch) | Planet PerryBelgo | WikipediaIs Plymouth Gin the Unluckiest Spirits Brand Ever? | Just DrinksMackerel | The Art of Tasting PortugalCounterfactuals | Stanford Encyclopedia of PhilosophyCounterfactual History and the Outbreak of World War I | American Historical Association“No Lenin, No Hitler?” Reflections on Simon Sebag Montefiore’s Bolshevik Revolution Counterfactual | The Counterfactual History ReviewExpected Value Definition, Formula, and Examples | InvestopediaGlobal Management Consulting Firm | Bain & CompanyStrategic Management Consulting | Boston Consulting GroupWhat Is the Growth Share Matrix? | Boston Consulting GroupDoes Marriage Actually Make People Happier? | Psychology TodayHarvard Professor: Winning the Lottery Won’t Make You Happier in Life | CNBCLiving Longer: Historical and Projected Life Expectancy in the United States, 1960 to 2060 | US Census BureauA Research-Based Approach to Relationships | The Gottman InstituteWhere Will You Be Happiest? | Richard KochCape Town TourismDoris Day: Que Sera, Sera | YouTubeThe Pros and Cons of Moving to Portugal as an Expat | PortugalThe Road Less Traveled: A New Psychology of Love, Traditional Values, and Spiritual Growth by M. Scott Peck | AmazonTom Magliozzi: Happiness is Reality Minus Expectations | The Knoxville News SentinelMeditations by Marcus Aurelius | AmazonChurch or Cult? Inside the Moonies’ ‘World of Delusion’ | Financial TimesStrategy Consulting Firm | L.E.K. ConsultingMental Toughness Training for Sports: Achieving Athletic Excellence by James E. Loehr | AmazonRumble in (British) English Slang | Able2KnowBasic Buddhism: The Theory of Karma | BuddhaNetThe Lost Religion of Love and Optimism | Richard KochThe Log Song | The Ren & Stimpy ShowEngland World Cup 1966 Stamp | Exploring StampsExperts Forecast Cancer Research and Treatment Advances | American Association for Cancer ResearchEnglish Patriotic Song: The Spanish Armada | English Folk ProjectChurchill: Walking with Destiny by Andrew Roberts | Amazon“I Shall Be the One to Save London” | The Churchill ProjectFanDuel | WikipediaEurope’s Largest Wholesale Platform for Used Cars | AUTO1The Oxford Experience | Oxford University Department for Continuing EducationWadham College, University of OxfordThe Oxford Tutorial | Oxford Study Abroad ProgrammeTHE OXFORD EXPERIENCE at WADHAM COLLEGE, OXFORD Contact formFlexible Work Options | L.E.K. ConsultingStep Brothers | Prime VideoGather with Purpose: How to Host a Jeffersonian Dinner | Purpose GenerationDialogUnderstanding Comics: The Invisible Art by Scott McCloud (Note: Tim considers the first three chapters a bit slow, so he suggests skipping around.) Pablo Picasso in Eight Periods | DailyArt MagazineColin Smith | Tate BritainWhat Steve Jobs Learned from the Bauhaus | ArtsyWhy Steve Jobs’s Passion for Calligraphy Is an Important Example for You | EntrepreneurDan Carlin’s Hardcore History PodcastThe Daily Stoic: 366 Meditations on Wisdom, Perseverance, and the Art of Living by Ryan Holiday and Stephen Hanselman | AmazonSHOW NOTES[06:18] What3Words.[12:59] Upbeat fish pond reflections.[15:04] Journaling toward optimistic investment.[17:14] Betfair vs. bookmakers.[27:42] How history ties in with investment strategy.[33:47] Assigning probabilities.[36:56] The cows, the stars, and the question marks.[45:41] 80/20 happiness.[57:36] A qué será, será quandary.[1:06:48] Toxic beliefs and terrible templates.[1:11:24] A meeting with Bill Bain.[1:14:41] Charm school.[1:15:08] Why Bain & Company was a better fit than BCG had been.[1:17:34] The formula.[1:25:04] Identifying one’s own toxic beliefs.[1:35:04] Opposites to toxic beliefs.[1:41:53] Churchill’s helpful delusion.[1:47:46] The formation of grand beliefs.[1:51:06] How grand beliefs can become toxic.[1:53:37] Pattern interruption.[1:56:08] The Oxford Experience for 99/1 people.[2:09:04] A bespoke request for hands-on art.[2:11:33] Useful beauty.[2:18:55] Parting thoughts.MORE RICHARD KOCH QUOTES FROM THE INTERVIEW“The 80/20 principle runs … through the whole of my thinking. In terms of my own success or money, but also things like happiness, I’m trying to think, ‘What are the few things that I need to do in order to attain what I want?'”
— Richard Koch
“I go around asking people, ‘Who are your best five friends in the world?’ And people come up with a list. And then I say, ‘Who are the five people that you spend most time with?’ And very often, the lists are completely different. And that tells you that that person, they might be happy, but they’re certainly going against the grain.”
— Richard Koch
“M. Scott Peck wrote a book which starts, ‘Life is difficult.’ This is one of the great things about life. If you understand this, you can transcend it, because you anticipate that things are going to be difficult and you can take pride in overcoming difficulties. But if you expect there are going to be no difficulties, obviously you are going to be disillusioned.”
— Richard Koch
“Delusions can be very helpful sometimes.”
— Richard Koch
“Happiness is probably the least selfish thing that you can pursue, because if you’re happy, you’re going to make a lot of other people happy, as well. If you’re miserable, you’re going to make other people miserable.”
— Richard Koch
The post Richard Koch — Revisiting the 80/20 Principle, The Power of Optimistic Journaling, Studying History to Improve Investing, and The Grand Beliefs of Winners (Plus: The Toxic Beliefs of Losers) (#680) appeared first on The Blog of Author Tim Ferriss.
