How to Invest Your Money Like The 0.1%

Key Concepts

• Four Stages of Wealth Investment: Foundation (Health), Skills & Knowledge, Business, Financial Assets.
• ROI on Self-Investment: Prioritizing personal development yields the highest returns.
• Just-in-Time Learning: Focusing on acquiring knowledge directly applicable to current challenges.
• Centurion Council: Building a network of 100 mentors (authors, operators, coaches, peers).
• Pack Script: A method for effectively reaching out to mentors (Proof, Ask, Close).
• Theory of Constraint: Identifying and investing in the bottleneck limiting business growth.
• Buy, Borrow, Die Strategy: A tax-efficient wealth preservation and transfer method.
• Buyback Principle: Hiring to reclaim personal time and focus on high-value activities.

Investing Like the Top 0.1%: A Detailed Breakdown

The conventional wisdom about how the wealthy invest – primarily in stocks and real estate – is fundamentally incorrect. Based on personal experience as a top angel investor and alongside prominent figures like Google founders and Jay-Z, the top 0.1% follow a distinct four-stage investment strategy. This strategy prioritizes internal investment before external financial assets.

Stage One: Invest in Your Foundation

This initial stage is non-negotiable and centers on preparing oneself to receive wealth. The primary focus is on holistic health – both mental and physical. The speaker emphasizes that once financial success is achieved, well-being becomes the paramount concern. Ill health drastically narrows one’s focus, while good health unlocks a multitude of possibilities.

Specific recommendations include prioritizing fitness, sleep, and nutrition, all of which directly impact cognitive function. A practical “hack” is to invest in an expensive gym membership, not just for the facilities, but for the environment and the association with other successful individuals. The speaker notes, “Cheap people don’t go to expensive gyms.” Elevating one’s social circle to include CEOs and entrepreneurs is also crucial for support and inspiration.

Stage Two: Invest in Your Skills and Your Knowledge

This stage marks a turning point in financial trajectory. The highest ROI comes from “buying better thinking” – actively seeking out and paying for expertise. This includes paying for blueprints, answers, and the condensed knowledge of experts who have spent years mastering a subject. This accelerates skill development and increases earning potential.

The speaker highlights the importance of transforming teachers into relationships. He shares an example of his 12-year-old son proactively investing in digital courses to accelerate his learning. He personally has studied and integrated over 1,600 business books into his life and teaching. Coaches are also identified as powerful tools for transformation, often occurring at the point of financial transaction.

He advocates for a “just-in-time” learning approach – focusing on knowledge needed to solve current problems, contrasting it with the “just-in-case” model of traditional university education. He cites Never Eat Alone by Keith Farazzi as a pivotal book that taught him the importance of networking, leading to a long-term relationship and continued learning. He now incorporates networking into his routine, inviting contacts for workouts or hikes. A free resource, the “Martell Method” newsletter, is offered (link in description) as a way to access mindset, entrepreneurship, and growth tactics. The core principle is that continued learning is essential because “If I already knew what I needed to know to be successful, then the success would already be in my life.”

Tactical Methods:

• Centurion Council: A list of 100 mentors categorized as authors, operators, coaches, and peers. The process involves “bathing in the waterfall of their knowledge” – consuming their content – before reaching out.
• Pack Script: A three-part approach to contacting mentors:
  • Proof: Demonstrate you’ve used their work (“I read this and it impacted me…”).
  • Ask: Pose one specific, concise question.
  • Close: Keep the conversation brief and respectful of their time.

Stage Three: Investing in Your Business

The top 0.1% don’t gamble; they strategically reinvest in the engine that generates cash – their business. This involves prioritizing speed and efficiency. Investing in quality “gear” – computers, software, etc. – is a quick way to see a return. The analogy of a roofer using a nail gun illustrates the productivity gains.

Paying for “blueprints” or playbooks – consulting, mentorship – is also crucial. The speaker routinely asks potential mentors for an hour of their time, sometimes paying upwards of $30,000 for that access. He emphasizes pushing knowledge down to employees, rather than bottlenecking it at the CEO level. He cites an example of his creative director building a mastermind group to accelerate learning.

He recounts a personal experience of hiring a business coach, Bob, after two failed companies, which led to almost $1 million in revenue within a year. The “buyback principle” is introduced: hire to reclaim your time and focus on high-value activities.

Reinvestment Framework:

• Fixed Percentage: Allocate 20-30% of profits for reinvestment each quarter.
• Leveraged Opportunities: Deploy capital into the area with the greatest potential impact.
• Theory of Constraint: Identify and address the bottleneck limiting business growth (marketing, sales, or delivery).
• Avoid Cash Hoarding: Invest excess cash, even if it means liquidating it from a holding company if needed.

Stage Four: Investing in Financial Assets

This stage is the last step for the top 0.1%, serving as a safety net and wealth preservation mechanism, not a primary wealth-building strategy. Stocks, S&P 500, and REITs are considered safe, long-term options. The speaker emphasizes taking risks in the primary operating business where an unfair advantage exists, not in speculative investments.

He references a mentor, Ken, who stated, “Making money, that’s easy. Keeping it is super hard.” The focus shifts to preservation.

The “Buy, Borrow, Die” Strategy:

This tax-efficient strategy involves:

1. Buy: Acquire stock in your primary business.
2. Borrow: Take out a loan secured by the stock (no tax implications).
3. Die: Life insurance pays off the loan, leaving the stock to heirs tax-free.

He cautions against investing in areas outside of one’s expertise, recounting a negative experience with real estate during the financial crisis. He views money as “little workers” that should be actively deployed.

Conclusion

The key takeaway is that wealth creation for the top 0.1% is a sequential process. It begins with investing in oneself – health, skills, and knowledge – then reinvesting in the business that generates cash flow. Financial assets are treated as a final stage for preservation and compounding, not as the initial investment vehicle. The speaker encourages viewers to commit to one action today to begin their journey towards more effective investing, emphasizing that continuous learning and self-improvement are paramount. He directs viewers to his newsletter for ongoing insights and resources.