Let’s imagine a world where Elon Musk is a video game professional instead of the co-founder and CEO of electric car maker Tesla.
Or one in which Warren Buffett plays the ukulele instead of a revered investor and owner of the Berkshire Hathaway holding company.
Finally, let’s imagine a scene in which Bill Gates makes a living playing bridge instead of becoming the brains behind the Microsoft technology group.
These worlds could have existed if the three billionaire business magnates had followed their passions instead of their talents, something Scott Galloway advises against.
In his new book, The algebra of wealthA marketing professor at New York University’s Stern School of Business, who served on the board of directors of The New York Times, advises people to put aside their passions to get ahead financially.
“If someone tells you to follow your passion, it means they’re already rich,” writes Galloway, who grew up in Los Angeles and now lives in London. “And they usually made their fortune in some unglamorous industry like iron ore smelting. Your mission is to find something you are good at and apply the thousands of hours of courage and sacrifice necessary to become great at it.”
Although his approach may horrify some, he says that following your passions will likely lead you to careers where the supply of enthusiastic workers far exceeds the demand. He points out that sports, music, film and fashion are some of the most offending industries.
Galloway, who has founded nine companies, explains that only 2 percent of professional actors make a living from their craft and half of all visual artists earn less than 10 percent of their income from their art. Similarly, the top 3 percent of YouTube channels receive 85 percent of all views on the platform.
“A former client of mine, Chanel, is among the strongest brands in the world, with thousands of prices and gross margins of 90 percent,” he notes. “The family that owns Chanel are billionaires. And they had unpaid interns. Why did they do this? Because they could. ‘Follow your passion’ is Latin for ‘prepare to be exploited.’”
So how does Galloway define talent? Something that is easy for you and that others find difficult, she writes. Unlike passion, she continues, talent is observable and verifiable; It can be more easily converted into a high-paying career and improves the more it is exploited.
“Passion for something can make you better at it; talent definitely will,” he argues. “Doing what you are good at creates a virtuous circle. Your achievements come faster, boost your confidence, and encourage more focused effort. The entire experience is somewhat more pleasurable than exhausting, which makes it easier to relive it day after day, year after year,” she says.
He cites as an example one of the first people he hired at Prophet, a consulting company he founded in 1992. Her name is Connie Hallquist and, before joining the company, she had been a French academic, professional tennis player and currency trader. .
All of those career paths took advantage of their distinct and obvious talents. But what she was really good at, Galloway says, was managing people. “I have rarely seen someone so skilled at putting together a plan, motivating a team, and driving everyone toward a common goal.”
Hallquist founded her own business and has since been hired for a number of CEO roles.
“Unlike tennis or commerce, people management is amorphous and difficult to identify as talent. But, when identified and cultivated, it is possibly the most valuable a person can have. People often assume that if someone is intelligent and a good person, they are a good manager. That is not true. It is a different skill and one that can be trained but, like most skills, it flourishes best in those with natural talent.”
What about the rest of the book? He says it’s a practical guide to “optimizing your life for wealth and success.” What it is not is a self-help book to put your finances in order by collecting supermarket coupons or lowering the temperature of your boiler. Galloway’s book is aimed at those who may already be described as wealthy.
“This is not a typical personal finance book,” he admits. “There are no spreadsheets you have to fill out. “I’m not going to tell you to cut up your credit cards or tape motivational quotes on your refrigerator,” she says.
In a style without frills, The algebra of wealth attempts to explain what you need to know to improve your chances of achieving financial security. Galloway examines how to harness and optimize big economic waves; what small steps can be taken that could lead to big benefits in the future, including diversification; and how stoicism can help minimize spending and develop better financial habits.
“How do you achieve economic security? There is an answer: that’s the good news. The bad news? The answer is . . . little by little,” he states.
The Algebra of Wealth: A Simple Formula for Financial Security by Scott Galloway (Torva, £22.00)
This article is part of FT Wealtha section that provides in-depth coverage of philanthropy, entrepreneurs, family offices, as well as alternative and impact investing.