#466: Richard Koch on Mastering the 80/20 Principle, Achieving Unreasonable Success, and The Art of Gambling

**Tim Ferriss** (0:00)
Well, hello, boys and girls, ladies and germs, whether you're here across the pond, in the pond or otherwise, this is Tim Ferris, and welcome to another episode of The Tim Ferris Show, what I just said will make sense in a moment.
It is my job on every episode to deconstruct world-class performers, to tease out the favorite books, the habits, routines, forms of journaling, whatever it might be, that you can test and apply in your own lives. My guest today, I've wanted to have on for a very long time, his name is Richard Koch, K-O-C-H. Richard is an entrepreneur, investor, former strategy consultant, and author of several books on business and ideas, including four books on how to apply the 80-20 principle in all walks of life. He also has a wonderful British accent, which is why I talked about Across the Pond.
His investments, because he's not just a theoretician, he's a practitioner, his investments have grown at 22%, compounded annually over 37 years. That's a long time, try that with a small number and see what happens. Richard's investments have included Filofax, Plymouth Gin, Belgo, Betfair, which is the world's largest betting exchange. We talk about this one quite a bit, FanDuel and Auto One. He has worked for the Boston Consulting Group and was a partner at Bain & Co, that's Bain & Co, before leaving to start LEK with Jim Lawrence and Ian Evans, which expanded from three to 350 professionals during the six years Richard was there. In 1997, the 80-20 principle, the book, reinterpreted the Pareto Rule, extending the observation that most results come from a small minority of causes, which was well known in business, into personal life, happiness, success and more. The book, substantially updated in 2017, has sold more than a million copies.
I have bought many of those myself and given copies away. It's been translated into roughly 40 languages and become a business classic. It was named by GQ Magazine as one of the top 25 business books of all time. His new book, published on August 13th, 2020, is Unreasonable Success and How to Achieve It. In it, Richard charts a new map of success, which he says can propel anyone to new heights of accomplishment. High success, he says, does not require genius, consistency, all-around ability, a safe pair of hands, or even basic competence, which is reassuring, but it does require the nine key attitudes and strategies he has identified. And we dig into all of this and more in this conversation.
It's important to note, I had a great time doing this, that's not important, but the following is important, that we talk about a lot in the world of investing and consulting because I want to give you all a lens into his thinking.
So rather than listening to someone say, negotiating is important, I would prefer to dig into real world examples of what they have done so you can learn how to fish, metaphorically speaking, as opposed to being given a fish in the form of some type of fortune cookie parable or something like that. So we get into a lot of concrete details in investing and consulting and those are lenses through which you can look at many, many areas in your own life, whether it's personal or business. So I just wanted to explain that and I think that's enough preamble. We get into a lot, we get into The Art of Gambling, 80-20 Principle, Happiness Islands, Achieving Unreasonable Success, Ball-Aking Insights, Journaling, Walt Disney and lots more. You can find him on Twitter at RichardKosh8020 and online, richardkosh.net.
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