The compound interest of relationships & the importance of trust

Some of of us are aware of a a quote attributed to Albert Einstein even though it turns out there’s no evidence him saying it:

Compound interest is the eighth wonder of the world

Sadly when you’re a genius many quotes eventually get attributed to you in order to give it some weight. 

But this does not take away from the weight and beauty of the concept of compound interest in particular when we apply it beyond the realms of finance coupled with frequency:

(1.01%) 365  ≈  37.78%

When applied to relationships, improvements and increase in trust compounds. What may have required a detailed and bullet proof contract or statement of work eventually becomes a handshake with much lower friction. The time and effort invested in relationships compounds as trust over time. 

High trust environments and societies allow individuals to cooperate efficiently without constant oversight. 

On the other hand, losing trust has a devastating effect. Whether this erodes over time or more frequently when trust is lost immediately and all the capital invested is lost. 

Which brings us to the following equation:

A full 1% loss per day is slightly harsher: £100 falls to about £2.55 after a year (a 97.45% loss).

Math can be both beautiful and terrifying. 

https://www.instagram.com/p/BQTRH9mAKtJ/

https://nav.al/long-term

What we believe in is important

  • Curiosity, learning and change
  • Trust and relationships
  • Think BIG, act small
  • Soft real skills over talent
  • Margin and boredom as creative fuel
  • Extreme Ownership
  • Leaders Eat Last

Further Examples

The importance of margin and boredom as creative fuel

A packed schedule, devoid of margin, has become a status symbol, overshadowing the natural rhythms of life. Incorporating margin and embracing boredom fosters creativity, inspiration, and the ability to seize opportunities.