Hello everyone, another week another post, this time about something really important if you're trying to scale your business. If you are not in that spot yet, no worries, you will be one day (if you want to be) and you can learn a thing or two so bare with me.
You probably heard the word leverage many times. It means different things in different context. Here we will talk about types of leverage in business context. First and foremost I want to put here definition of word leverage, so here it is:
What we want to focus on for the most part is “use (something) to maximum advantage.“ That something in a world of capital markets and business can be few things. These few things are:
CODE
First type of leverage is code. With few lines of code you can scale to humungous proportions. It is the ultimate leverage of 21st century. You need computer, knowledge and a lot of consistency and you can create amazing things, even by yourself. Some of examples of code leverage are Facebook, Snap, ChapGPT etc.
CAPITAL
Code is still relatively new type of leverage, but capital has been with us for some time. Capital as a form of leverage is maybe the best one, the only problem is you need to have enough of it to kick in numbers magic, and that usually takes time, blood, sweat and tears (for the most). When you get to that place your capital works for you, but it takes a lot to get there. You can also use smaller amount of capital to get a lot of it if you are in some unique position (ex. you have an edge in some trade), but it is rare.
MEDIA
Next we have Media, which is also really powerful type of leverage. In the past it was in the paper format, after that it was screens and today we also have social media and other platforms (Youtube for example) which are taking over mainstream media sources. It is happening for a simple reason that everyone have access to it and its inexpensive which we can't say for mainstream media sources.
LABOUR
The last but not the least one is the oldest one and maybe the most obvious one to a lot of people is Labour. This one is the biggest headache because dealing with people and leading people is always hard, but if you can do it right it is really efficient. The first 3 types of leverage are definitely taking a big part (and it's growing by the day). 100 years ago you needed a lot of employees to hit $1 million mark and today you can do it with one app, one youtube channel or with a little bit of capital by yourself. And that is the power of leverage.
I hope you like this kind of content (so we can take a break from time to time from psychology related posts). I also think this is really important stuff and can help you out a lot in life, so use it whenever you can (for the good things of course). If you like this kind of content feel free to subscribe. If you have some comments or criticisms feel free to reach out.