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Principles

Life and Work

by Ray Dalio


In 1975, Ray Dalio founded an investment firm, Bridgewater Associates, out of his two-bedroom apartment in New York City. Forty years later, Bridgewater has made more money for its clients than any other hedge fund in history and grown into the fifth most important private company in the United States, according to Fortune magazine. Dalio himself has been named to Time magazine’s list of the 100 most influential people in the world. Along the way, Dalio discovered a set of unique principles that have led to Bridgewater’s exceptionally effective culture, which he describes as “an idea meritocracy that strives to achieve meaningful work and meaningful relationships through radical transparency.” It is these principles, and not anything special about Dalio—who grew up an ordinary kid in a middle-class Long Island neighborhood—that he believes are the reason behind his success.

In Principles, Dalio shares what he’s learned over the course of his remarkable career. He argues that life, management, economics, and investing can all be systemized into rules and understood like machines. The book’s hundreds of practical lessons, which are built around his cornerstones of “radical truth” and “radical transparency,” include Dalio laying out the most effective ways for individuals and organizations to make decisions, approach challenges, and build strong teams. He also describes the innovative tools the firm uses to bring an idea meritocracy to life, such as creating “baseball cards” for all employees that distill their strengths and weaknesses, and employing computerized decision-making systems to make believability-weighted decisions. While the book brims with novel ideas for organizations and institutions, Principles also offers a clear, straightforward approach to decision-making that Dalio believes anyone can apply, no matter what they’re seeking to achieve.

Here, from a man who has been called both “the Steve Jobs of investing” and “the philosopher king of the financial universe” (CIO magazine), is a rare opportunity to gain proven advice unlike anything you’ll find in the conventional business press.

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Recommendations: 2

Categories: Business & CareersManagement & Leadership

Reading time: 1213 hours

Recommendations


Matt Mullenweg
Entrepreneur

I wish it had come out a decade before because I could have saved a lot of trouble. It’s called Principles by Ray Dalio, who’s one of the most successful hedge fund investors and he runs his company in an extremely interesting way. And this is the first of I think several books he’s planning on doing where he spells out the things he’s learned. He’s one of these folks who has an extremely analytical mind, writes down everything and checks it later. So if your mind is not as analytical like mine is not quite there. Actually, I think probably a few people in the world are quite as analytical as Ray Dalio is. It can be, I would say provocative and challenge you to think in different ways.


Kevin Systrom
Entrepreneur, Co-founder of Instagram

I give people that are trying to learn actively is Principles by Ray Dalio. It’s interesting actually. Someone gave me the PDF. It was a PDF before his book. Gave me the PDF and I skimmed over. I was like, “Oh, this is pretty good.” They were like, “No. I seriously think you’re going to love this.”

For some reason, I didn’t get around to it for maybe a year-and-a-half, and then I read the actual book, and I was blown away. It’s both a guide to life, a guide to business, and also I think an insight into Ray and someone who’s built an amazing business. If you guys listening don’t know what he does, he runs a hedge fund called Bridgewater and he’s so much more than just a finance thinker, he’s also just a brilliant philosopher. I give that a lot because I think it’s a great guide to life.