The Principles for Success by Entrepreneur & Investor Ray Dalio: A 30-Minute Animated Primer

Investor and hedge fund manager Ray Dalio has a net worth of $18.4 billion. That alone would persuade a great many of us to listen to any and all advice he has to offer, but unlike many multi-billionaires, he's also put no small amount of thought into just what advice to give and how to give it. One reason is that the pieces of advice he doles out publicly began as pieces of advice for himself, discovered through trial and error and refined into a set of principles. These he lays out in his book Principles: Life and Work, the content of which he has also distilled into the animated video above, "Principles for Success by Ray Dalio."

Dalio breaks down his own journey to success as the continued repetition of a five-step process:

  1. Know your goals and run after them
  2. Encounter the problems that stand in the way of getting to your goals
  3. Diagnose these problems to get at their root causes
  4. Design a plan to eliminate the problems
  5. Execute those designs

This framework already sets Dalio apart from other successful advice-givers, some of whom offer nothing more than broad platitudes about believing in yourself and never giving up hope, and others of whom fall back on cynical cracks about doing unto others before they do unto you. Dalio, for his part, endorses a mindset he calls "hyperrealism," the adoption of which demands putting the truth before all else. And the hyperrealist first examines the truth about himself, assessing as objectively as possible his weaknesses as well as his strengths and regularly drawing upon the perspectives of those who disagree with him.




Underlying Dalio's ideas about hyperrealism and success is a mechanistic conception of humanity, the economy, the world, indeed all reality: "Everything is a machine," as he starkly puts it. By this, he doesn't mean we should think of ourselves as pre-programmed robots, but that we can approach all of our choices as puzzles to be figured out. "Most everything happens over and over again in slightly different ways," he says, but most of us, with our viewpoints biased toward recent history and our "ego and blind spot barriers" that keep us from seeing the full picture, mistakenly regard the situations in which we find ourselves as unique, thus making them into more difficult problems than they are.

Of course, even if we embrace hyperrealism and develop ever more reliable strategies to surmount the obstacles that crop up along our chosen paths, we'll fail as often as we succeed. Dalio tells of his own grand humbling in the early 1980s when he bet everything on a depression that never came, and explains how the fallout taught him that "truth is the essential foundation for producing good outcomes." Even if we have no interest in doing what it takes to make $18.4 billion, we might still bear in mind the two principle-driven equations that Dalio provides — "Dreams + reality + determination = a successful life" and "Pain + reflection = progress" — along with his conviction that success requires not just knowing the truth of world, but the truth of ourselves as well.

Related Content:

Economics 101: Hedge Fund Investor Ray Dalio Explains How the Economy Works in a 30-Minute Animated Video

Steve Jobs Shares a Secret for Success: Don’t Be Afraid to Ask for Help

Harvard Dean Lists the 5 Essential Questions to Ask In Life … Which Will Bring You Happiness & Success

Oprah Winfrey’s Harvard Commencement Speech: Failure is Just Part of Moving Through Life

Alain de Botton Proposes a Kinder, Gentler Philosophy of Success

Based in Seoul, Colin Marshall writes and broadcasts on cities, language, and culture. His projects include the book The Stateless City: a Walk through 21st-Century Los Angeles and the video series The City in Cinema. Follow him on Twitter at @colinmarshall, on Facebook, or on Instagram.


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