Year-End Memo 2025 — IV of IV

Here is the frame this series has been circling, stated plainly.

Wealth is not built by working harder. It is built by owning things that work for you.

The people who compound over decades are not the ones who out-hour their peers. They are the ones who understood, early, that the input that matters is not effort. It is leverage — the ratio between what you put in and what returns to you — and there are only four kinds worth naming.

The four forms of leverage

Labour. Other people''s time and effort. The oldest form. It is real leverage, but it is expensive to acquire, hard to manage, and its returns scale linearly. Doubling output requires roughly doubling headcount. Every additional unit brings additional coordination cost. It works, but it is the least efficient of the four.

Capital. Other people''s money. More efficient than labour: capital does not need to be managed, motivated, or reviewed. Deploy it well and it compounds. Deploy it badly and it evaporates. It scales, but it requires access — and access is the thing capital is designed to protect. Historically the domain of the already-wealthy.

Code. Software that works without you. Zero marginal cost of replication. One person can build a product that serves millions, works while you sleep, and improves with each release. This is the leverage that made the last two decades'' fortunes.

Media. Attention that compounds. A single essay, video, or podcast can reach millions without permission. Every piece adds to a body of work that continues to generate opportunity, trust, and reach long after publication. It scales infinitely and requires no capital to produce.

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The distinction that matters: the first two require permission. The last two do not.

You need someone''s approval to hire employees or raise capital. Nobody''s approval is required to write code or publish media. This is why the last twenty years produced more self-made wealth, from more unlikely starting positions, than any period in economic history. The two forms of leverage that most closely resemble physics — replicable at near-zero marginal cost, indifferent to who deploys them — became universally accessible for the first time.

The multiplier effect

The people compounding fastest are not choosing between these forms. They are combining them.

Code and media together are the most powerful pairing. Code builds the product. Media builds the audience the product serves. Each amplifies the other. The audience trusts the operator, so they try the product; the product performs, so the operator''s authority compounds. Attention becomes distribution. Distribution becomes revenue. Revenue funds the next release, which further extends the authority.

This is the pattern behind almost every operator who reached significant scale in the last decade without institutional capital. Not code alone. Not media alone. The compound of the two.

The trap of trading time for money

The single most valuable reframing in this material is old and worth restating anyway:

If you are trading your time for money, you have a job — even if the job pays extraordinarily well.

Salary, hourly rates, project fees, consulting engagements — all of them are variations of the same structure. You stop working, you stop earning. That is not a business. It is well-compensated labour.

The move to ownership is the move from selling time to accumulating assets that produce value without your continued presence. That is what "wealth-building" actually names.

What this series has been arguing

Read together, the four memos describe one shift with four faces.

Trust moved from institutions to people, because platforms made individual reputation legible at scale.

Category kings capture the market because clarity of definition is now the leverage that compounds most reliably in crowded fields.

The creator economy is a distribution inversion — control passing from institutions to individuals as the intermediary layers dissolve.

And leverage is the vehicle by which all of this is executed, because in a world where distribution is free and trust is peer-to-peer, the constraint on outcomes has moved from access to ownership.

The through-line is straightforward. Ownership is the asset. Leverage is the vehicle. Clarity is the wedge that opens the market.

The people who understand this are already building. The rest will read this and wait for permission.

Sources

This memo is a synthesis rather than a report on new data. The framework of the four forms of leverage — labour, capital, code, media — and the distinction between "permissioned" and "permissionless" leverage is Naval Ravikant''s, most concisely stated in his tweetstorm and podcast series How to Get Rich (Without Getting Lucky) (2018–2019). https://nav.al/rich

The wider argument draws on the three preceding memos in this series:

  • Deriss, Trust Moved to People — Year-End Memo I of IV. https://deriss.com/articles/trust-moved-to-people
  • Deriss, The Clarity Premium — Year-End Memo II of IV. https://deriss.com/articles/the-clarity-premium
  • Deriss, The Distribution Inversion — Year-End Memo III of IV. https://deriss.com/articles/the-distribution-inversion

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