book image

The Millionaire Fastlane

by MJ DeMarco

Date finished: 08 Oct 2023

A lot of good thinking and insight. Some books take 300 pages to convey an idea that could have been expressed in 10 pages. This book feels like a lot of those books compressed. There is no new or groundbreaking information, but there is a lot of good information all in one place. I think the book is most effective and useful if you ever wanted to start your own business but didn't, yet. DeMarco's tone is quite particular and takes some getting used to.

All Book Notes | Amazon page

Rich people often don’t do as they teach

Success and financial advice often given by “experts” does not align with the actions they took themselves to attain success and wealth. Their teachings don’t necessarily work, but selling them does.

Listen to those who practice what they preach and back their advice with a proven track record.

Many financial experts promote strategies, but their wealth often comes from different sources.

Success is a process, not an event

Success is usually experienced by observers as an event: Beatles having a hit single and instantly rising to fame, an entrepreneur sells their company and suddenly becomes a millionaire etc. Behind those events there is process. Events are byproducts of process. Without process there is no event.

True wealth, money, happiness

True wealth and happiness can usually be described by the quality of your relationships, your physical health, and the amount of freedom you enjoy. The three Fs: family, fitness, freedom.

True wealth is the freedom to do what you want. You know what you want, the price you want to pay, and can go do it. If you think you can’t afford it, you probably can’t. If you think you can afford it but only if a certain condition stays the same or changes, you can’t afford it. You can afford it when you don’t need to think about it, and the impact of the purchase to your life is unconditional to future circumstances.

Freedom is the most important of the wealth trinity, because it protects the other two (family, fitness). Freedom gives you ownership of your time. You are much less likely to take actions that sacrifice your relationships and health if you are not financially “forced” to.

Everyone’s personal definition of freedom is different. Knowing your personal definition defines your goals and allows you to plan your actions.

A lot of studies come to the conclusion that money doesn’t buy happiness. An underlying problem with such studies is that they don’t study correlations that may lead to such results. Lack of happiness is caused by servitude, not by money. Most people earn more money by sacrificing more of their freedom. This results in less true wealth: worse freedom, family, and fitness.

The happiest people according to studies report to have tight sense of community, social support, and strong family bonds.

Many millionaires are miserable and it has nothing to do with their wealth, and all to do with their lack of freedom.

Wealth and health are both hard to obtain. They require long-term thinking, consistency, and embracing delayed gratification.

Choices, luck, ownership, accountability, control

Luck is a residue of process. When you consistently act and bombard the world with your efforts, creating waves and interacting with the waves of others, things happen. You improve your probabilities of events happening. You change your probabilities from impossible, to unlikely, to possible, to likely.

When you play, you allow luck to work for you. If you don’t play you can’t win.

Unsuccessful people have a victim narrative. They give control of their life to others, and when things don’t work out, they blame others. You cannot be a victim if you do not surrender power to someone capable of making you one.

Statements like “they didn’t tell me”, “they raised my rent”, “they laid me off”, etc. are all abdications of taking ownership and control. The landlord’s right to increase the rent was in the lease agreement, and no one forced you to work for the employer that you chose.

You cannot be a victim if you claim responsibility and ownership of your actions. Most bad situations are consequences of bad choices. Owning your decisions allows you to acquire wisdom rather than adopting a victim attitude.

People whose life is out of control usually blame external factors (other people, events, institutions etc.) for their situation.

Accountability means facing consequences and changing your actions to avoid them.

To control your life you need to take responsibility, and follow up with accountability.

You only deserve what your actions have or have not earned.

If you have been doing the same thing over years and you are not happy with the results you are getting, it makes little sense to keep doing it.

There are a lot of “rich” people who have more financial trouble and their lives more out of control than “poor” people. Money does not solve poor financial management and lack of financial discipline.

Poor results are the outcome of poor choices. If you are not where you want to be, the problem is your choices.

Actions, beliefs, perceptions, are all what creates your reality. All these are choices you make.

You are exactly where you decide(d) to be.

Taking ownership of your choices is taking ownership of your life. Ownership is the only way to control and direct your life.

You cannot undo your choices. Depending on their magnitude, some choices can impact or handicap you for life.

Everyday decisions you make today will ripple years in the future.

Success is a lot of good choices. Lot of good choices are a process. Consistent process is a lifestyle.

Choice is the most powerful control you have in life.

Perception and belief precedes action.

Create a system for yourself that allows you to evaluate the risks and worst-case scenarios of actions you are considering. Similar to Tim Ferris’s Assess-the-risk-of-your-fears.

Stop being self-restrained by the past. The universe doesn’t care about your past, nor do most people on Earth. If you are fully defined by your past, you cannot become who you want to be in the future.

“Normal” life and being an employee

The traditional path to wealth is to get a good job, invest your savings in the stock market, do it for 30 years, and you will be a millionaire. It’s problematic because:

  1. it’s linearly tied to your time - and takes a lifetime to achieve
  2. it’s dependent on too many factors you don’t control - such as the stock market, your employer, etc.

Conventional wealth advice is bad advice coming from people you trust like family, school, financial experts etc.

Normal life today is to wake up at 06:00, work 09:00-17:00 Monday-Friday, save 10%, invest 10% in the stock market, repeat for 50 years. Normal does not make sense at all to any human who hears it for the first time. Normal is indoctrinated irrationality.

The conventional wealth plan is work + save + invest for 50 years, and be rich at retirement.

A plan whose key parts you don’t control is a bad plan. Without a job, the plan fails. If the stock market crashes, your plan fails. If the housing market crashes, your plan fails. The plan depends on time and external factors, and you don’t control any of them.

By working as an employee you accept to trade 5 days of work, for 2 days of freedom. While most people recognize that 5-for-2 is a bad deal with money (60% negative return), they do it willingly with their time.

The 5-2 trade never changes no matter how long or hard you work as an employee. No matter how much time you invest, if you choose to work 4 days, you get 80% of the salary.

In most jobs - including charging insanely high rates for high-quality freelancing work - you sell time your time for money. If you don’t work for a week, that’s a week’s worth less money.

Trading time for freedom is not a good trade, unless you trade time for a process that can eventually give you better return on your time.

By working faithfully 8 hours a day, you may eventually get to be a boss and work 12 hours a day.

~ Robert Frost

As an employee, you sell freedom to get freedom. You sell your life, to get money, to live your life.

Being an employee comes with a limited financial ceiling

Most jobs provide you with limited, specialized experience and knowledge. (See also Paul Graham’s You weren’t meant to have a boss.)

As an employee, your income is in the control of your employer. If you are working for freedom, and your financial plan is your job, then you don’t control your freedom.

Taxes and deductions take cuts off your money before you see them, leaving you with minimal control over your finances. Your ability to leverage pre-tax income is restricted.

When owning a corporation, you dissociate yourself from your business. This gives you limited liability, and space for tax creativity.

Your salary is capped by company policies. If you give 10x value to a company with your work, they will not give you 1000% raise. Your negotiation power is constrained.

The conventional “get a good job, save, and invest” path to wealth provides you with uncontrollable, limited leverage. Your theoretical ceiling for wealth is limited.

\[Wealth = Job + Investments\]


\[Job = HourlyPayRate \times HoursWorked\]


\[Investments = InvestedSum \times (1 + Yield)^{time}\]

Your job income is limited to the amount of time available in a day. You cannot work for 400 hours. Time has no leverage.

Your investment income is limited again by time (years of compound interest), AND the market returns. You control none of the two.

Hope is not a plan.

Your hourly pay rate is usually correlated to the intrinsic value attributed to you by society. You can raise this value through education, but education is expensive both in time and money 1.

Life can be precarious and unpredictable. When expecting to build your wealth through save-invest-compound, you are betting with your most precious asset, time.

There are people who become wealthy through the conventional path. They are usually either extremely talented, elderly, or overworked.

A net worth of $1,000,000 today is barely upper middle class. You don’t get to live much more differently than a person earning $100,000/yr.

Become an entrepreneur


As an employee you trade your work for your employer’s cash. You keep training to be stronger, to lift heavier stones.

As an entrepreneur you trade your work to build systems. Those systems lift the stones for you.

Entrepreneurship results in accelerated knowledge, acquired through engagement, action, and feedback.

Only those who will risk going too far can possibly find out how far one can go.

TS Eliot

As an entrepreneur you can exert much higher leverage compared to an employee.

Small numbers have a gravity towards mediocrity.

The vast majority of wealthy people experience exponential or chunked growth of their wealth. A big amount of money, after several hard working years.

When you create a profit generating asset - like a service, or a product - the asset’s value grows. This means that by increasing the profits of your business, you increase its value, which increases your profit when you sell equity. You are essentially getting double payback for your effort.

Stocks define the value multiplier for publicly traded companies, through the price-to-earnings ratio.

Value on paper is illiquid, as you cannot buy anything with it. Valuations are nothing but current perceived value, since a company valued today at $60M can be valued next year at $1M if they do poor decisions. Illiquid wealth is always in risk of having it’s subjective value changed.

Consumer vs Producer

As a consumer, you demand, want, need, buy. As a producer, you create value and fulfill needs. You need to shift your perspective to a producer to succeed in entrepreneurship.

When encountered with advertisement, examine it as a producer.

Watch infomercials to learn what the experts do.

Grow a money tree

In order to stop trading time for money, you need to create a system that generates revenue even when you don’t put time into it, e.g. when you are sleeping. You need to grow a money tree. A passive income source.

Human resource systems are expensive to manage and implement. Also humans are unpredictable.

Content systems are less likely to succeed even when executed well. Entry barrier is extremely low, so competition is extremely high, and in most cases revenue comes from affiliate programs (hitchhiker instead of driver).

Lead generation systems benefit from fragmented industries where the players are small-to-medium sized businesses.

Money is passive by itself

Money is inherently passive by itself. Once you have money, it’s very easy to invest it to generate more of it.

Investing $10M at 5% results in a monthly passive stream of $41,667.

Compound interest is a source of passive income, not a tool for wealth (fast) growth.

Law of effection

Law of effection 2: the more lives you affect, in scale and/or magnitude, the wealthier you will become.

\[Profit = UnitsSold \times UnitProfit\]

where $UnitsSold$ is scale and $UnitProfit$ is magnitude.

You need scale, magnitude, or both. With scale or magnitude, you create millions. With both, you create billions.

The closer you are to the source of big numbers, the closer you get to wealth.

What makes a good business?
Control of the market

The one who controls a system/market/technology makes the big money. Everyone who hitchhikes, makes good money at best. You need to control almost every aspect of your system 3.

Stop climbiing pyramids and start building them.

High entry barrier

The lower the entry barrier to a field, the more competition you face. If anyone can start your business within hours, choose a different business.

If you are exceptional, you don’t need to worry about low entry barrier.

Real startups are processes, not events.

When “everyone is doing it”, you have to be really thoughtful about whether it’s a good idea. It’s most likely not.

There is need

No one cares about your desires, wants, needs, or reasons you want to do things. You have to show people what’s in it for them. To succeed as a producer, you need to give up your own selfishness and address the selfishness of others.

Stop chasing money and start chasing needs.

Address other people’s needs, problems, pain points, service deficiencies, and emotions.

Money is like love and happiness. The more you focus on it, the more elusive it becomes. Instead of trying to attract money, think of what attracts money. Solve problems and needs.

People are voting all the time with their time, thoughts, or money. Get their vote by:

You need to know your WHY for doing things, otherwise you risk being misguided by money (and other people).

Detaches income from time

You need to build a system that detaches income from time. In other words, you need to grow a money tree. Content systems, computer systems, software systems, distribution systems, human resource systems can all be money trees.

If it doesn’t make money while you sleep, it’s not a money tree.


Same idea as in law of effection: impact millions and you will make millions.

You will face pushback if you have unconventional ideas

When you have unconventional ideas, you will be met with resistance. Extraordinary results require extraordinary beliefs and actions. To live unlike everyone you need to be unlike everyone.

Societal norm is not exactly sane: get up, go to work, come home, watch tv, go to bed, repeat. This is mental. The gravity of society is to be average, not exceptional.

If you hang out with dogs, you will get fleas.

Family, friends, and the environment will probably be headwind. As a producer, you will be a minority.

The worst headwind you can have is from your spouse.

You need to protect yourself and your ideas from negative energy.

Good people fuel your dreams, motivate you, and extend your opportunity reach.

Be stingy with your time, not with money

Your time is your life. When you are dedicating time to something or someone, you are dedicating a chunk of your life.

Time is scarce, money is abundant.

When you are an employee, you don’t just pay 8 hours a day. You pay 8 hours plus all the time you spend dressing up for work, preparing, commuting, etc.

You work for freedom. Freedom is freely allocated time. Paying time to get back time doesn’t make a lot of sense.

When you spend 1 hour driving, to save 10$ by buying a TV cheaper than the store next to your house, you are valuing 1 hour of your life for 10$.

Lifestyle extravagances have double cost: the cost itself, and the time cost.

Failure is the sweat of success

The same way you can’t exercise hard without sweating, you can’t succeed without failing. If you avoid failure, you avoid success.

Failure is just an event. If you don’t give up, you will eventually be successful. Success is a process.

Fear of failure is caused by an overestimated worst-case consequence analysis. Usually, the worst-case scenario is not that bad.

“Someday” is dangerous and paralyzing. You never get anywhere with it. The same is true with waiting for some arbitrary favorable condition.

You don’t need a crazy big idea, opportunities are everywhere

Opportunities are everywhere. Buggy software, bad service, annoying call centers. Every little thing that annoys you when using existing products or services is an opportunity.

Opportunity is rarely a huge big big thing like the light bulb or the car, and most times it’s simply an unmet or poorly met need.

It’s okay if other people are already doing it 4. The question is, can you do it better? Can you do it cheaper? Most successful entrepreneurs take existing concepts and improve them. They take poorly met needs and solve them better. Instead of focusing on the big idea, they focus on the big execution.

Your thoughts constantly flood you with business opportunities:

Opportunity is exposed in your and other people’s language and thoughts.

Ideas are free, bias towards action

Most people don’t do anything even when they know and agree with what needs to be done to succeed. Few people try, but half-ass it. Very few people try, try hard, and stick to it long enough.

Thinking of a business has no output. Ideas are nothing but electrochemical reactions in your brain. They’re events that require little effort. You have to create the business and execute well. Execution is a process. Execution requires effort, sacrifice, discipline, and persistence.

Execution is the great divider separating winners and losers from their ideas.

What affects your success in order of importance:

  1. execution
  2. marketing
  3. customer service
  4. product
  5. idea

(ꆜ Derek Sivers - Ideas are just a multiplier of execution)

Business plans are useless unless they’re backed by tangible execution. You should still do a reasonable financial analysis though.

Investors back the person, their track record, and the execution, they don’t back a business plan.

If you have a track record of execution, people will suddenly become interested in your business plan.

Positivity, belief, visualization etc. are all necessary but not sufficient conditions for success. You need action that affects in scale.

Customer feedback is gold

Collect customer complains like a maniac. They are free feedback and expose unmet needs in your business.

When you change things, at least some people will complain because of habitude. These are hard to validate so you need to use metrics and analytics to gauge if the complaints should be heard.

Expectation complaints are vital because what you provide didn’t meet the client’s expectation for some reason. Did you offer bad service? Bad product? Do you have misleading marketing? Did customers misunderstand how they are supposed to use your offering? Are there operational issues?

When customers request something and you don’t have it, it exposes unmet needs. It’s people telling you what they want for free.

I don’t know what’s the key to success but the key to failure is trying to please everybody.

Bad customer service is so commonplace today that we get surprised when someone offers decent customer service. Use that to your advantage.

Determine what the customers expect out of your business. Then positively violate this expectation. Spend money on pleasing your existing clients rather than trying to find new ones. Satisfied customers become evangelists and free advertising for your business.

Look big but act small. Look like you have the power of a big company, but give personal service as if you’re a one-human op. No one likes dealing with bureaucracies and admin work. Also looking big scares away potential competitors.

Amazing product cannot overpower bad service. Human experience is the no.1 selling weapon.

Choose who you let into your castle carefully

You company is like a fortress. Don’t let just anyone in.

A company is a collection of people. Bad or mediocre people result in bad or mediocre companies.

A business partner is like marriage. Partnerships survive on character, synergy, and complimentary attributes.

Don’t start a company with someone you don’t know well. Would you marry someone after two weeks of dating?

When hiring, investigate and interview. Get referrals. Anyone with inside access to your company has the potential to ruin it. Employees are the public perception of a company.

Trust actions, not words.

Trust, but verify.

When you impact millions, you come in contact with millions. This will inevitably lead to bad contacts. This doesn’t mean the world is bad, there are just some bad people out there.

Avoid competition

Products and services that are homogeneous between providers are commoditized, like air travel. In any commoditized product, people are loyal to the price, not the product.

Mind your own business, not the competition. Otherwise, you neglect your product, and you become reactive rather than proactive.

Your job is to innovate, skew value, and win customers. Do that well, and then everyone will be following you instead of you seeing what they’re doing.

Marketing is the Queen of business

Marketing is extremely powerful. People buy mediocre products and tolerate mediocre services because of great marketing.

Build a brand that people are loyal to.

Have a unique selling point that focuses on benefits. This helps the customers choose your company. Provide specific actions and evidence.

Domino’s didn’t say “Delivered on time”. It said “Delivered within 30 minutes, or it’s free”.

There is too much noise in marketing today, making it hard for real value to show through. Some ways to get above the noise:

Grabbing the attention is half the battle. The other half is communicating enough value to create a sale.

Marketing should focus on benefits, not features. Who is your buyer? What do they want? What are they trying to solve? What do they want to feel?

You can use price tricks to reframe value. Price is tied to perceived value. Purchasing a knife for $80 ONLY $20 for a limited time! feels much better than purchasing a knife for $20.

  1. Education is mostly free or ridiculously cheap in Europe. If you study in your home town and thereby don’t have living costs, you are basically studying for free in money terms. But the time cost is still present. 

  2. effect: create, do 

  3. This reminds me a lot of how vastly influential entrepreneurs were obsessive with vertical integration (Rockefeller, Bezos, etc.). 

  4. When Dropbox founder was pitching the idea to investors they retorted that there’s already dozens of cloud storage and file sharing apps. He then asked them, “yes, but which one are you using?”. He was pointing out the fact that while lots of apps exist, most of them are clunky, and very few people actually use them. There was a pain point in the market, that he thought he could address. 

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