Jan 30, 2017

The Compound Effect

My takeaways from The Compound Effect, by Darren Hardy

More than just a productivity book, The Compound Effect, by Darren Hardy, deals with the importance of developing good habits. It is easy to read and full of valuable insights and actionable steps.

Here are my most important takeaways:

Massive results take time

Whether we are trying to build wealth, lose weight, learn a new language or any other worthwhile pursuit, success only comes after small, consistent actions performed over a long period of time. Most people get discouraged because they don’t see results weeks, months or even years after they start, but eventually momentum is built and massive results begin to show. The author makes the analogy of “the penny that doubles” (if you start with a penny and double it every day, after 30 days you will have $10.7M).

On Choices

At the beginning, you make choices. Then, your choices make you. Make good choices.

On Owning Outcomes

If you want to be successful you need to develop an owner mentality. This means holding yourself 100% responsible and accountable for your outcomes. You may have done 90% of the work but if you haven’t crossed the finish line it won’t mean anything. It is not enough to your do your part. All that matters is the end result.

The Formula for Success

Success = Preparation + Attitude + Opportunity + Action

There will always be an element of luck, but when opportunity knocks you need to be prepared and ready to take action.

Small Difference, Big Payoff

The horse that wins by a nose wins 10X the price money. The soccer team who wins the championship, even with a penalty goal in extra time, gets all the glory. As you get good at what you do, you will notice that the difference between the best and the rest doesn’t seem that big, but achieving that plus is the hardest part. It takes practice, preparation, consistency and good habits. That plus is why the best get paid disproportionately more than the very good.

The Ripple Effect

One small action sets in motion thousands of other small actions that make a huge difference over time. When you stop going to the gym even for one day it doesn’t seem like much, but you are breaking momentum, which is the hardest thing to get back.


When you have why-power (a goal), willpower comes easy. You need to know why you are doing what you are doing.

Small, Consistent Steps

World class performers increase difficulty a little every day. They aim for small, steady steps, consistently applied over a long period of time.

Avoid Instant Gratification

You won’t notice the immediate effects of eating that greasy donut or skipping a workout, but compounded over time these seemingly inconsequential actions will derail your chances of success. Think of the second order effects of everything you do.

Be, not do

It’s not “what do I have to do to get X”, but “who do I have to become to attract X”.


The first step is always the hardest one. Starting wins half the battle. Before we achieve momentum we have to start. Momentum is why the rich get richer, the happy get happier and the lucky get luckier.

Routine Power

Routines, even trivial ones, are important because they represent small wins that keep us motivated. It is important to start and end our days with routines: make your bed, meditate, evaluate your day and set goals for the next day.

External Influences

Surround yourself with positive influences and supportive people: don’t watch news, find a mentor, assemble your own board of advisors. Look at what successful people do and do that. For example, successful people never stop learning. The most skilled musicians, public speakers, sports icons, CEOs, etc. always hire a coach to help them become better than they already are.


Do one little thing more than your competition. Make one more phone call, send one more email, check with customers after the sale, ask for feedback to see how you can improve. This extra effort doesn’t cost much but will make a huge difference in the long run.

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