Book Review: Principles by Ray Dalio
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A lot’s already written about Principles by Ray Dalio and its even an App. So what do I have to add? An anecdotal feature about how it influenced me to shut down my own company (yes, you read that right), pivot 90 degrees into something tangential at the time and find what I’d been trying to build through a different avenue.
I first heard about Principles when Bridgewater Associates recruited a friend of mine working in investment banking.
“Not for me,” he said, or something similar. “It’s a weird place. The founder wrote a manuscript that every employee is required to read before starting. I’ve heard it’s pretty far out. They record every meeting with every employee too and give everyone access to those recordings.”
Intrigued doesn’t sum up my interest.
I Googled this outfit as soon as I got home and found Bridgewater offered Principles as a free PDF. A few of the search results around it gave the impression this was as polarizing as my friend had described. That’s a hallmark of something work checking out so I sent the PDF to Kinkos, had it bound it up and knew this deserved a spot on the bookshelf between my high school copy of Anarchist Cookbook and A Million Little Pieces even if it was garbage.
I’m a relentless underliner, starrer, highlighter, dog-earing, annotating reader. My books look like an old baseball mitt when they’re finished. Here’s what I recall from memory about that first reading:
- Principles crystallized a lot of what I’d already been thinking, only Dalio was 25 miles further down the road by then. Was the message weird? It wasn’t for everyone, that was obvious. But it was definitely for me.
- The concept of building a machine as metaphor for my pursuits, which at the time was building a private investigation agency. I had a lawyer working full time, used subcontractors almost exclusively for the work and, at the time, open discussions with owners of two larger firms that were interested in selling/merging so they could exit. The goal was to create a billing platform for consulting in good, bad and in between times.
- Despite owning and running my own company, I also wanted to work at Bridgewater! Kind of. The mythical hedge fund money was beside the point. What’s it like to having all conversations recorded? Could I hang with that level of rigor? Would I thrive? I was curious.
Thumbing through Part 1, where most of the annotation occurred, it’s interesting eight years later how much I agreed wholesale with the ideas. Dalio point blank asks if you — the reader — agrees with his statements. And I unequivocally answered yes everywhere.
Some of my favorite sections include:
“I learned that finding out what is true, regardless of what that is, including all the stuff most people think is bad — like mistakes and personal weakness — is good because I can then deal with these things so they don’t stand in my way… There is nothing to fear from the truth… I want the people I deal to say what they really believe and to listen to what others say in reply in order to find out what is true.”
This resonated deeply with the former newspaper reporter still inside me. It was essentially what motivated me to study journalism in college.
“People who acquire things beyond their usefulness not only will derive little or no marginal gains from these acquisitions, but they also will experience negative consequences, as with any form of gluttony.”
“Most problems are potential improvements screaming at you.”
Probably the most instrumental section as it relates to this post is this single sentence: “Your goals must be riveted in your mind: they are things you MUST do.”
Down in the dirt of my business and far below these lofty Principles, I needed a business development app that would sort through my emails, remind me to reach out to contacts who’d been cold for 30 days and ideally gather something interesting from Twitter on a #subjectofinterest to that person so I could email them to keep the lead warm. A consultant said this would cost $15,000, which would totally pay for itself… except an engineer friend told me that was entry-level programming I could learn. That was around the time software bootcamps were starting. I saw one advertised for $8,000 (half the cost), registered impulsively, put the agency on cruise control for three months with the lawyer and started the following week.
When I came out the other side three months later, expanding my agency screamed at me: You don’t want to do this anymore. Building a Kanye West sentiment analyzer screamed at me. So did figuring out how to use a database-as-a-service. And so… I shut down my agency to do another bootcamp, which is another longer story. People thought I was crazy and it was one of the best decisions I made. All of that eventually resulted in me leading security at a startup that screams at me every day for all the right reasons.
These days, it’s Part 3 that produces the most value for me. When I’m stuck or have run into a problem with work, thumbing through Part 3 is like bouncing around a pinball machine. Pretty soon one of those items will bounce me in the correct direction. They’re all hard to disagree with and largely how we teach children to behave. Be open and honest, it’s okay to share your feels and actually expected, do the right thing for everyone.
