“And if it can’t be fun, what’s the point?” — Donald J Trump, Trump: The Art of The Deal
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Whether you hate him, love him, laugh at him, gossip about him, or make him a joke, one thing is clear: you can’t ignore Donald Trump.
I picked up “The Art of the Deal” because I wanted to figure out what makes him tick.
My goal is to be memorable and skilled at communication, without any apologies.
I want to command attention with impactful ideas that shape the people and world around me. “The Art of Dealmaking” is full of words, but here are the 9 key lessons I found worth remembering. Here are my notes:
Think Big: You are going to be thinking anyway, you might as well think big. Most people think small, because most people are afraid of success, afraid of decisions, afraid of winning. And that gives people like me a great advantage.
Insights:
- Most people are also afraid of failure. Especially large public failure.
- If you can learn to position your failure, it will be easier to think big and act big.
- While ‘Think Big’ mindset is common — ‘Act Big’ mindset is uncommon strictly due to fear of failure.
Protect the Downside and the Upside Will take care of itself: People think I am a gambler. But I’ve never gambled in my life. To me, a gambler is someone who plays slot machines. I prefer to own slot machines. It’s very good business being the house.
In fact, I believe in power of negative thinking. I happen to be very conservative in business. I always go into the deal anticipating the worst. If you plan for the worst, if you can live with the worst-the good will always take care of itself. The point is that, if you go for a home run on every pitch, you are also going to strike out a lot. I try never to leave myself too exposed, even if it means sometimes settling for a triple, a double, or even on rare occasions, a single.
Insights:
- This is a hard lesson. When we say somebody is entrepreneur — we always think of risk.
- Nicholas Taleb says, “You should study risk taking, not risk management”
- This lesson is all about attitude.
- When you only focus on the upside, “psychological — anchoring” kicks in and you gamble away lot of resources, increasing the cost.
- But attitude of always protecting the downside helps you keep things in perspective and remove speculation out of risk taking.
Maximize your options: I never get attached to one deal or one approach. For starters, I keep a lot of balls in the air, because most deals fall out, no matter how promising they seem at first.
Insights:
- I read this idea with Warren Buffet’s concept of — ‘What do you do at the top? You make small number of high value decisions’. While two ideas seem contradictory, they are same. To maximise your option, you need to work your psychology.
- Getting too attached to one thing, gets you emotional. Instead of taking optimised decision, you end up making emotional deal.
- Very few deals pan out, so it is important to keep an open mind and look at the options.
- Also Warren Buffet and Charlie Munger constantly hammer importance of reading and thinking. Few number of high value decisions stem from reading, thinking and risk taking.
Know Your Market: Some people have a sense of the market and some people don’t. I ask and I ask and I ask, until I begin to get gut feeling about something. And that’s when I make a decision.
Insights:
- Knowing your market means spending substantial time with the right kinda people. Constant interaction leads to building mental image of what is really going on under the hood.
Use Your Leverage: The worst thing you can possibly do in a deal is seem desperate to make it. The best thing you can do is deal from strength and leverage is the biggest strength you can have. Leverage is having something the other guy wants. Or better yet, needs. Or best of all, simply can’t do without.
Unfortunately, that isn’t the case, which is why leverage often requires imagination, and salesmanship. In other words, you have to convince the other guy it’s in his interest to make the deal.
Enhance You Location: In real estate, you don’t necessarily need the best location. What you need is the best deal. Just as you can create leverage, you can enhance a location, through promotion and through psychology.
Insights:
- Let’s repeat essential point — “as you can create leverage, you can enhance a location, through promotion and through psychology. “
Play with people’s fantasies: People may not always think big themselves, but they can still get very excited by those who do. That’s why a little hyperbole never hurts. People want to believe that something is the biggest and the greatest and the most spectacular. It is an innocent form of exaggeration and a very effective form of promotion.
Insights:
4 ‘P’ strategy of influencing people:
- Profiling
- Presentation
- Persuasion
- Personality
Contain the cost: I never threw money around. I learned from my father that every penny counts, because before too long your pennies turn into dollars. To this day, if I feel a contractor is overcharging me, I’ll pick up the phone, even if it’s only for 5,000$ and I will complain. People say, why bother. My answer is that the day I can’t pick up the telephone and make a twenty five cent call to save 10000$ is the day I’m going to close up shop. The point is that you can dream great dreams, but they will never amount to much if you can’t turn them into reality at a reasonable cost.
Insights:
- I read and listened to several biographies — and this one Key Lesson stayed constant. If you want to, forget everything, but not this lesson.
- I have burned my hand — ignoring this lesson.
Have Fun: Money was never a big motivation for me, except as a way to keep score. The real excitement is playing the game. I don’t spend a lot of time worrying about what I should have done differently, or what’s going to happen next.
Insights:
- This last line seems simple and product of common sense.
- I read this line with wisdom from ‘Almanack of Naval Ravikant’
- Art is creativity. Art is anything done for its own sake.
- When you do things for its own sake and have fun, you get better at it. Iterative improvement can give you compounding results — if:
- you have natural inclination towards what you are doing
- You are doing it for its own sake and you are having fun
- You are getting feedback immediately
- You are improving iteratively
- You repeat the process