James Altucher Shares Unexpected Tips to Help You Execute Your Next Big Idea
If you can improve any skill by 1% each day, you’ll double your ability every 72 days. James has used this formula to help him get better at both comedy and entrepreneurship.
James Altucher is best known as an entrepreneur, angel investor, venture capitalist, and hedge-fund manager. He’s also a best-selling author, podcaster, and — what some people might not know — a comedian.
Sure, James has been involved in at least 1,000 businesses, including Reset Inc. and StockPickr, as an investor, entrepreneur, venture capitalist, and hedge-fund manager. But he’s also picked up some incredibly valuable skills as a comedian.
“I can take those skills — and they’re amazingly difficult skills in comedy — and I can take those skills and bring them back into my business life, whether it's public speaking, writing, negotiating, selling, or investing,” he says.
I had the chance to interview James at Stand Up NY, a comedy club in New York City where he’s a part-owner. (Yes, of course he invested in a comedy club!) James and I talk about everything from “Seinfeld” to time travel, but, perhaps most interesting, were the valuable lessons he’s picked up as a comedian and applied to his business ventures.
An entrepreneur walks into a comedy club…
…Oh, it’s James Altucher!
At first glance, comedy and entrepreneurship might seem completely unrelated but, surprisingly enough, the skills James has picked as a comedian have helped him become a more savvy entrepreneur. Here are some of the most valuable insights we talked about.
1. Run fast with your ideas
Before James started his first business, he worked as an online producer at HBO in the ’90s. That’s when he fell in love with comedy. But fear held him back from actually getting on stage and performing.
“It was fascinating to watch,” James recalls. “I really wanted to do it, but I was terrified, terrified to go on stage. I was really afraid the audience was going to heckle me.”
James sat on the sidelines for years, until Stephen Dubner (you know him from “Freakonomics”) challenged him to do stand-up. That was the push James needed, and three months later he had what he calls “the best six minutes of my life” on stage.
It was about four years ago now that James made that leap into the comedy world, and he has no regrets — only perhaps that he’d overcome his fears sooner.
Today, James encourages entrepreneurs to run with their ideas — don’t be afraid to just get on stage, so to speak. Because here’s the thing: The first three businesses James started failed. In fact, he’s started 20 businesses, and 17 of which have failed.
At first he hated the rejection, and he resolved to never start another business. Then he decided to keep going and use the failures as lessons. Today, he encourages entrepreneurs to do the same.
If you have an idea, find the easiest way to try it out. Don’t put a ton of time or money behind it — you just want to see if it could work. If it does, great! If not, move to your next idea.
2. Figure out how to skip the line
James isn’t trained in stand-up comedy. He didn’t sit through hundreds of hours of classes or seminars or workshops. He didn’t hang out at comedy clubs every night until 2 a.m. Instead, he figured out how to skip the line — or skip the so-called 10,000 hours it takes to become an expert at something.
So, he invested in a comedy club, which allowed him to surround himself with real experts and learn from people who have been doing stand-up for years.
James will be the first to admit comedy clubs aren’t the best investment. To be honest, he doesn’t recommend it. But he’s had fun with it and most importantly, it gave him invaluable access to talented comedians.
It parallels his journey in business. He didn’t go to business school. He doesn’t have an MBA. He learned along the way, and he’s surrounded himself with smart investors.
In fact, before he invests in a new venture, he has three rules:
Invest in the first round, so not when a company is at a high valuation.
No more than 2% of his net worth can go toward a deal.
Invest side-by-side with investors who are smarter than him.
That third point is key to shortcut your learning curve and skip the line. James surrounds himself with people who are smarter than him, and whose experiences have been different than his own.
“It's better for me to invest with people smarter and let them do all the hard due diligence,” he says. “They've got 50 PhDs running around … they'll do all the hard work, and they have more connections than me.”
In return, he’s always sure to offer them something, whether that’s new ideas, strategies, or industry insights.
3. Improve 1% a day by learning from mistakes
James resolves to get 1% better at comedy each day by watching his past performances and taking notes on ways he can improve. He also watches and learns from other comedians.
For instance, in one video he watched of himself on stage, he noticed he was hunching. By becoming aware of that hunch, which was affecting perception of his performance, he was able to improve his stand-up just a little bit — what he calls a 1% improvement.
Over time, small improvements lead to big gains. “If you just want to improve 1% a day at everything, compounded, that means you're going to double in ability every 72 days,” he says. “This applies not just to comedy. It can apply to investing, entrepreneurship, relationships, parenting, whatever.”
Now, quantifying his improvements in comedy can be difficult, but this is a formula that’s worked in business, too.
When James was in his mid-20s, he already had three or four failed businesses under his belt, so he took a step back and analyzed exactly what went wrong and mapped out a plan to overcome those mistakes.
To this day, he continues to learn from his “thousands of mistakes” — including that one time he invested in a time machine (yes!).
4. Read the room
When you’re telling jokes, you’ve got to read the room. What might be funny to your friends, probably won’t be funny to a group of drunk cruise ship guests, so you have to adapt.
Within just a few months of starting stand-up, James was able to apply these new skills to his non-comedy public speaking engagements.
“I'm feeling the audience completely differently than I used to,” he says. “You start to figure out who you should focus on, depending on what your goal is for different parts of the talk.”
During an informal, 15-minute speech one day, he started interacting with the audience, like he would at a stand-up show. He decided to crowdsource his talk that night, letting the audience clap to choose which topic they wanted to hear about. This makes them feel special, he says, and they’ll be more interested because they participated in choosing the topic at hand.
Something else he learned in comedy and applied to his public speaking is addressing what’s happening in the room. If you can address the noise coming from the other conference room, the weird elephant decor, or the small chairs, for instance, you can quickly get people on the same page and make them feel like part of your “tribe,” James describes. Then, they’ll be more likely to engage.
So, no, we can’t all jump on a stage tonight and start telling jokes, but we can learn a thing or two from James, who’s proven himself as a successful entrepreneur and stand-up.
This article is based on Episode 50 of the Entrepreneurs Circle, hosted by Erik Cabral, founder of PodMAX and On Air Brands.
