“M. Scott Peck wrote a book which starts, ‘Life is difficult.’ This is one of the great things about life. If you understand this, you can transcend it, because you anticipate that things are going to be difficult, and you can take pride in overcoming difficulties. But if you expect there are going to be no difficulties, obviously you are going to be disillusioned.”
— Richard Koch
Richard Koch (@RichardKoch8020) is an entrepreneur, investor, former strategy consultant, and author of several books on business and ideas, including four on how to apply the 80/20 principle in all walks of life.
His investments have grown at 22 percent compounded annually over 37 years and have included Filofax, Plymouth Gin, Belgo, Betfair, FanDuel, and Auto1. He has worked for Boston Consulting Group and was a partner at Bain & Co. before joining Jim Lawrence and Iain Evans to start LEK, which expanded from three to 350 professionals during the six years Richard was there.
In 1997, Richard’s book The 80/20 Principle reinterpreted the Pareto Rule—which states that most results come from a small minority of causes—and extended it beyond its well-known application in business into personal life, happiness, and success. The book, rewritten in 2022, has sold more than a million copies, been translated into roughly 40 languages, and has become a business classic. It was named by GQ as one of the top 25 business books of all time. Richard’s latest book is Unreasonable Success and How to Achieve It.
He has two upcoming books: 80/20 Beliefs, which identifies the very few beliefs in our lives that strongly influence what we do, and, therefore, the results we get, and 80/20 Daily, a collection of 365 short daily readings using the 80/20 philosophy to achieve the good life.
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The transcript of this episode can be found here. Transcripts of all episodes can be found here.
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Want to hear the last time Richard Koch was on the show? Listen here to our conversation in which we discussed investing for the mathematically challenged, Oxford Bodleian Library secrets, writing The 80/20 Principle, optimizing happiness, different journaling styles, nine landmarks of successful people, Nelson Mandela’s unique intuition, and much more.
What was your favorite quote or lesson from this episode? Please let me know in the comments.
SCROLL BELOW FOR LINKS AND SHOW NOTES…
SELECTED LINKS FROM THE EPISODE
- Connect with Richard Koch:
- THE OXFORD EXPERIENCE at WADHAM COLLEGE, OXFORD | Contact form
- Richard Koch on Mastering the 80/20 Principle, Achieving Unreasonable Success, and the Art of Gambling | The Tim Ferriss Show #466
- Unreasonable Success and How to Achieve It: Unlocking the 9 Secrets of People Who Changed the World by Richard Koch | Amazon
- The 80/20 Principle: The Secret to Achieving More with Less by Richard Koch | Amazon
- The Simplest Way to Talk about Location | What3Words
- Glastonbury Festival of Contemporary Performing Arts
- Fear-Setting: The Most Valuable Exercise I Do Every Month | Tim Ferriss
- How to Increase Your Luck Surface Area | Codus Operandi
- Tranche: Definition in Finance, Purposes, and Examples | Investopedia
- Betfair | Wikipedia
- Bookmaker | Wikipedia
- What Is Vig and Overround? | Matter of Stats
- Filofax Company Turnaround Strategy (Richard Koch) | Planet Perry
- Belgo | Wikipedia
- Is Plymouth Gin the Unluckiest Spirits Brand Ever? | Just Drinks
- Mackerel | The Art of Tasting Portugal
- Counterfactuals | Stanford Encyclopedia of Philosophy
- Counterfactual History and the Outbreak of World War I | American Historical Association
- “No Lenin, No Hitler?” Reflections on Simon Sebag Montefiore’s Bolshevik Revolution Counterfactual | The Counterfactual History Review
- Expected Value Definition, Formula, and Examples | Investopedia
- Global Management Consulting Firm | Bain & Company
- Strategic Management Consulting | Boston Consulting Group
- What Is the Growth Share Matrix? | Boston Consulting Group
- Does Marriage Actually Make People Happier? | Psychology Today
- Harvard Professor: Winning the Lottery Won’t Make You Happier in Life | CNBC
- Living Longer: Historical and Projected Life Expectancy in the United States, 1960 to 2060 | US Census Bureau
- A Research-Based Approach to Relationships | The Gottman Institute
- Where Will You Be Happiest? | Richard Koch
- Cape Town Tourism
- Doris Day: Que Sera, Sera | YouTube
- The Pros and Cons of Moving to Portugal as an Expat | Portugal
- The Road Less Traveled: A New Psychology of Love, Traditional Values, and Spiritual Growth by M. Scott Peck | Amazon
- Tom Magliozzi: Happiness is Reality Minus Expectations | The Knoxville News Sentinel
- Meditations by Marcus Aurelius | Amazon
- Church or Cult? Inside the Moonies’ ‘World of Delusion’ | Financial Times
- Strategy Consulting Firm | L.E.K. Consulting
- Mental Toughness Training for Sports: Achieving Athletic Excellence by James E. Loehr | Amazon
- Rumble in (British) English Slang | Able2Know
- Basic Buddhism: The Theory of Karma | BuddhaNet
- The Lost Religion of Love and Optimism | Richard Koch
- The Log Song | The Ren & Stimpy Show
- England World Cup 1966 Stamp | Exploring Stamps
- Experts Forecast Cancer Research and Treatment Advances | American Association for Cancer Research
- English Patriotic Song: The Spanish Armada | English Folk Project
- Churchill: Walking with Destiny by Andrew Roberts | Amazon
- “I Shall Be the One to Save London” | The Churchill Project
- FanDuel | Wikipedia
- Europe’s Largest Wholesale Platform for Used Cars | AUTO1
- The Oxford Experience | Oxford University Department for Continuing Education
- Wadham College, University of Oxford
- The Oxford Tutorial | Oxford Study Abroad Programme
- THE OXFORD EXPERIENCE at WADHAM COLLEGE, OXFORD Contact form
- Flexible Work Options | L.E.K. Consulting
- Step Brothers | Prime Video
- Gather with Purpose: How to Host a Jeffersonian Dinner | Purpose Generation
- Dialog
- Understanding Comics: The Invisible Art by Scott McCloud (Note: Tim considers the first three chapters a bit slow, so he suggests skipping around.)
- Pablo Picasso in Eight Periods | DailyArt Magazine
- Colin Smith | Tate Britain
- What Steve Jobs Learned from the Bauhaus | Artsy
- Why Steve Jobs’s Passion for Calligraphy Is an Important Example for You | Entrepreneur
- Dan Carlin’s Hardcore History Podcast
- The Daily Stoic: 366 Meditations on Wisdom, Perseverance, and the Art of Living by Ryan Holiday and Stephen Hanselman | Amazon
SHOW NOTES
- [06:18] What3Words.
- [12:59] Upbeat fish pond reflections.
- [15:04] Journaling toward optimistic investment.
- [17:14] Betfair vs. bookmakers.
- [27:42] How history ties in with investment strategy.
- [33:47] Assigning probabilities.
- [36:56] The cows, the stars, and the question marks.
- [45:41] 80/20 happiness.
- [57:36] A qué será, será quandary.
- [1:06:48] Toxic beliefs and terrible templates.
- [1:11:24] A meeting with Bill Bain.
- [1:14:41] Charm school.
- [1:15:08] Why Bain & Company was a better fit than BCG had been.
- [1:17:34] The formula.
- [1:25:04] Identifying one’s own toxic beliefs.
- [1:35:04] Opposites to toxic beliefs.
- [1:41:53] Churchill’s helpful delusion.
- [1:47:46] The formation of grand beliefs.
- [1:51:06] How grand beliefs can become toxic.
- [1:53:37] Pattern interruption.
- [1:56:08] The Oxford Experience for 99/1 people.
- [2:09:04] A bespoke request for hands-on art.
- [2:11:33] Useful beauty.
- [2:18:55] Parting thoughts.
MORE RICHARD KOCH QUOTES FROM THE INTERVIEW
“The 80/20 principle runs … through the whole of my thinking. So, in terms of my own success or money but also things like happiness, I’m trying to think, ‘What are the few things that I need to do in order to attain what I want?'”
— Richard Koch
“I go around asking people, ‘Who are your best five friends in the world?’ And people come up with a list. And then I say, ‘Who are the five people that you spend the most time with?’ And very often, the lists are completely different. And that tells you that that person, they might be happy, but they’re certainly going against the grain.”
— Richard Koch
“M. Scott Peck wrote a book which starts, ‘Life is difficult.’ This is one of the great things about life. If you understand this, you can transcend it, because you anticipate that things are going to be difficult and you can take pride in overcoming difficulties. But if you expect there are going to be no difficulties, obviously you are going to be disillusioned.”
— Richard Koch
“Delusions can be very helpful sometimes.”
— Richard Koch
“Happiness is probably the least selfish thing that you can pursue, because if you’re happy, you’re going to make a lot of other people happy as well. If you’re miserable, you’re going to make other people miserable.”
— Richard Koch
PEOPLE MENTIONED
- Andrew Black
- Vladimir Lenin
- Adolf Hitler
- Franz Ferdinand
- A.J.P. Taylor
- Bill Bain
- Bruce Henderson
- Charles Darwin
- Jeff Bezos
- Elon Musk
- Yuval Noah Harari
- Eeyore
- John Gottman
- Karl Marx
- M. Scott Peck
- Tom Magliozzi
- Marcus Aurelius
- Ralph Willard
- Iain Evans
- Sy Tilles
- Winston Churchill
- Elizabeth I
- Andrew Roberts
- Neville Chamberlain
- David Lloyd George
- George Bernard Shaw
- George VI
- Stuart Jackson
- Pablo Picasso
- Colin Smith
- Steve Jobs
- Dan Carlin
- Ryan Holiday
The Tim Ferriss Show is one of the most popular podcasts in the world with more than one billion downloads. It has been selected for "Best of Apple Podcasts" three times, it is often the #1 interview podcast across all of Apple Podcasts, and it's been ranked #1 out of 400,000+ podcasts on many occasions. To listen to any of the past episodes for free, check out this page.
Comment Rules: Remember what Fonzie was like? Cool. That’s how we’re gonna be — cool. Critical is fine, but if you’re rude, we’ll delete your stuff. Please do not put your URL in the comment text and please use your PERSONAL name or initials and not your business name, as the latter comes off like spam. Have fun and thanks for adding to the conversation! (Thanks to Brian Oberkirch for the inspiration.)
Dear Tim, thank you for a wonderful podcast.
I enjoyed this episode with the exception of the factual inaccuracy of Sally’s story. Police never shot or threatened to shoot dogs during the initial Covid lockdown period in Cape Town.
Thank you for your kind words about this episode and for your comment, Andrea.
The story found at https://www.timeslive.co.za/news/south-africa/2020-04-09-dogs-shot-for-no-reason-with-rubber-bullets-in-khayelitsha-lockdown/ may shed some light on the origin of this perception. (Warning to readers: the link goes to an article with a graphic photo of a dog undergoing surgery.)
Team Tim Ferriss
Huge fan Also from Cape Town, Agree with Andrea, Richard statement is uninformed. Team Tim shouldn’t be so defensive with weak evidence from a google search
Tim! I have dipped in and out of your podcast for years, and I always enjoy. I am struck though by how far I have to scroll before I see a female guest. I would love to hear you speak to this. Is it something you think about? Is it a challenge to find female guests? Are the best candidates for the show more often men? Appreciate any insight.
I second that. Would love to hear from more female speakers.
Brilliant chat. Your latest with Huberman was good too.
What a wonderful episode. Great to hear Richard interviewed again. I noted in particular the segment (1h 34 – 36m) on great questions to consider around beliefs, toxic and constructive. Love the turbocharging of 80/20 to 99/1s to look out for! Thank you Tim and Richard, Kevin
Your all episodes are mastermind. Nothing to say. Feeling lucky to find your website.
Thanks for a great chat. Tim, you may enjoy the late Roger Scruton’s documentary Why Beauty Matters.
The concept of “unreasonable success” and focusing on the few critical activities that yield the greatest results is a game-changer. It’s fascinating to consider how we can apply this principle to every aspect of our lives, from career to relationships. Thank you for sharing this valuable piece, Tim!
Excellent episode! I live in the UK so it’s nice to hear another British voice on there. I can’t get away from how he sounds identical to Bill Nighy, in tone and how he speaks!
Really inspiring listen so much to digest. I too thought Richard sounded uncannily like Bill Nighy!
Hey Tim. You’ve talked about doing these 80/20 analyses for years, but I struggle with actually doing in. Have you ever done a demonstration or some sort of practical example? Or are you aware of anyone who has. This might be too much hand holding but if you (or anyone on this blog/comments) could point to a youtube video, blog post, etc of what this might look like in practice I’d appreciate it.
Richard Koch’s 80/20 ‘Happiness Islands’ exercise is essential to identify the few things that truly matter to you in your life, in order to keep returning your focus to them!
https://medium.com/learning-for-life/how-to-use-paretos-80-20-heuristic-to-hack-your-happiness-20c7b727f0ef
Hi Tim!
I believe in this podcast you mention you don’t have socials on your phone. I’d love to do that but I’m just wondering if they aren’t on your phone how do you use them? Do you use a PC or do you download them and delete them when you need? I’d love to know how you manage things like self promotion (which you likely don’t have to worry about anymore) and staying in touch with a friend who might contact you through a social app.
I feel like I’d benefit from reducing my phone useage and content consumption like endless scrolling and reading short form information that seems to never stick.
Thanks a lot! And love what you do. You’re a true inspiration to many and your podcast does a lot to help guide me through life. I can confidently say that I believe I am a better and more thoughtful person because of you and your guests.
Hi Austin, Tim has chatted with Cal Newport a couple of times who is big into strategies to do this. He’s a great writer too and has very actionable stuff. I think its his book called Digital Minimalism that talks about it though check out their talk (#568) first to see if you like Cal’s vibe 🙂
Hey Austin,
Have you read the four hour work week?
From your question, it sounds like you haven’t. I suggest you read, or reread it. Batching, outsourcing and time management all come into play here.
Cheers Craig
Great podcast. I use the 80/20 principle when drawing and painting. I am an artist and illustrator from NY and appreciate the content. Thank you
Tim,
I’m actually replying to one of your “P.S.” that followed the “80/20” podcast in a recent email. You mentioned “Dry Farms” and I wanted to let you know there is another vineyard in Virginia that has the same standards that you might like – Arterra Vineyard [Moderator: Link removed.]
Check them out, the winemaker Jason is extremely passionate about his craft and his wines.
Loved this podcast and guest.
At the end of the podcast Tim your comment about the brilliant young Portuguese artist was frankly no surprise. As a professional fine artist, several years ago I was asked to be a judge for the local Maui public schools annual art competition grades Kindergarten thru Senior. Of the over one thousand pieces submitted the best work I saw was from the 5-10 year old’s. Creating work with the freedom that can only be created by those who have not yet been taught to care deeply what others think about their work. We’ve all probably seen similar outstanding art from young children posted on the family refrigerator. I will leave you with a quote from Picasso. “It took me four years to paint like Raphael, but a lifetime to paint like a child.”
Brad Forsythe
Maui HI – Houston TX
Hi Tim,
My fiancé and I just listened to your podcast with Richard Koch. We live in Portugal and got a recommendation from a friend for a person (if you are still looking for someone) who might be interested in working with the seven year old comic book prodigy you mention in the episode. The person is an illustration teacher at an art school called ArCo. Our friend reached out to him, so let me know if it is still relevant and we will be happy to connect you with him/the school.
PS: by the way, thanks for the inspiration through the 4HWW, it kickstarted our journey as entrepreneurs and helped us create a small lifestyle business 🙂
Tim I wonder if you agree that a Protestant work ethic or hard work as a net positive is truly a toxic belief?
LOVED this episode Tim and great to hear you both with loads more rapport due to being in person and having had copious amount of booze the night before ;). I’ve got all Richard’s books; he’s so easy to read, and the actionable steps and positivity are awesome! Thanks for the reminder…I’ve GOT to revisit them. One of the best is The Star Principle where he goes into much more depth about the Growth Share Matrix (mentioned on the Show). There’s some great ideas in there for anyone looks for great ideas on new segments of niches 🙂
Hey Nic,
I was just wondering where to start with Richard’s books, now I know thanks to your comment.
Thanks!
Cheers
Hey Tim – loved this chat with Richard, it’s been on my mind non-stop for the past couple weeks.
Also! I didn’t realize you were ever into drawing / visual art. I’m a New York Times Bestselling author / illustrator of picture books, so I found that really intriguing. I have so many questions. I’m also a podcaster, my show Creative Pep Talk is a big part of my creative practice as well.
One question I have, is now that you have this podcast – do you ever struggle to find a reason to make future books? Is the podcast a much more efficient way of delivering this info?
Thanks for all you do