The Compound Interest of Success

I’m sure you’re aware of compound interest of money.
You know… you put money in a bank account, you earn interest on that money then, that interest adds to the principal and then you earn interest on that new amount and what happens over time is, it starts to grow and increase exponentially.
And maybe you have even heard of Albert Einstein.
 So this Albert Einstein said that one of the greatest inventions of mankind was compound interest.
Well I don’t know. But what’s cool about compound interest is, it doesn’t just apply to money, it applies to a lot of different areas in life and it’s due to something that’s called Positive Feedback Loops.
Now, if you don’t know what Positive Feedback Loops is, they’re really fascinating things and it explains a lot about the world and why it is the way it is. What a Positive Feedback Loop basically is it’s a loop where a small change has a compounding effect.
So if you want to hear more about this, either watch the video or read the transcript. This choice is all yours.

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Here’s the transcript…
The Compound Interest of Success

I want to tell you about the compound interest of success. Now, I’m sure you’re aware of compound interest of money where you put money in a bank account, you earn interest on that money then, that interest adds to the principal and then you earn interest on that new amount and what happens over time is, it starts to grow and increase exponentially.

Albert Einstein said that one of the greatest inventions of mankind was compound interest. Well what’s cool about compound interest is, it doesn’t just apply to money, it applies to a lot of different areas in life and it’s due to something that’s called Positive Feedback Loops. Now, if you don’t know what Positive Feedback Loops, they’re really fascinating things and it explains a lot about the world and why it is the way it is. What a Positive Feedback Loop basically is it’s a loop where a small change has a compounding effect.

So, if you have money in a bank account, you earn interest on their it comes around in ads again and then, you earn interest on that new amount. So, it compounds and grows exponentially over time. Positive Feedback Loops don’t just apply to money in a bank account, they apply to a lot of different things and a couple of examples are you can probably think back to when you were high school in a sports team and they would have been one kid in that sports team who had a slight advantage and who was slightly better than everyone else in the sports team. Well, that slight advantage at first would have just been small but what would happen very quickly is the coach would favor that kid, he would give him more of his attention during trainings, he would get preferred positions in the sports team, he’d also get more game time, he’d also get more support from the sidelines and more support from his own team members and that small advantage just attracts more success and over time, that starts to compound. As his teammates and his coach tells them that you’re really good, he starts to think I’m really good, starts to play better and then that increase gets bigger and bigger and it just keeps compounding and compounding. This is how superstar athletes get to where they are. They start with a small advantage and then get positive feedback loops. It starts cascading and compounding overtime.

Now, another completely different example, just to explain how Positive Feedback Loops works is, you could have a pond with goldfish in it and if there is one goldfish that has a slight size advantage over the other goldfish, just ever so slight, that goldfish will be able to fight off other goldfish when they’re being fed food and he’ll be the leader in that pond which will mean that he will have access to more food and over time, he’ll grow exponentially and scientists have done studies. They look at a pond full of goldfish, they look at a group of animals and the one that has the slight size increase, if they come back in a few months, that animal has a huge size increase and this is due positive feedback loops. The same thing that’s going on with money and interest in your bank account.

Now, why this is important to you? Why this is important to you is what you’ve got to understand is you only need a slight increase and a slight improvement over everyone else or your competition before Positive Feedback Loop starts to take a fit. If you’re in a sports team or if you’re in business or if you’re a consultant or anything or if you have a software product, you only need to have a slight edge over everyone else before Positive Feedback Loop start to take a fit. My advice to you is, whatever you’re in whether it’s sports, whether you’ve got a job or you’ve got a business is, instead of looking at everyone that’s at the top and thinking, “Well, they’re so much further away from me.” Just look at what you can do right now to get a slight improvement over everyone else because I can tell you that Positive Feedback Loops will distort that improvement that you have overtime and you’ll start to earn compound interest on your own success.