Weekly Wisdom #324 - Leverage, Build Updates, Tiny Homes & AI Companies

Leverage, Build Updates, Tiny Homes & AI Companies

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Happy Tuesday!

One of the upsides of construction work is an appreciation for how good office work really is.

It only takes a few hours sweating outside in 30 degree weather to appreciate how easy it is to sit in front of a computer in an air-conditioned room; I have a lot of respect for the many workers that do this every day.

Construction does give a lot of satisfaction in seeing something you've built with your hands become reality.

But one of the things that struck me most in the first few days of doing work was how little leverage there is in construction.

Now, this shouldn't come as a surprise.

Working in software, I know that one of the big benefits is that the cost of delivering it to an additional customer is near zero.

The input-to-output leverage is almost infinite (though there are costs, like cloud infrastructure, AI tokens, etc.).

Delivering a software feature means thousands of customers immediately get to experience it.

In construction, delivering a feature means that only a single task is done.

In hardware in general, leverage comes from factories and machines.

Almost any prefab company will have a factory that builds components indoors; however, most of those are probably still done by workers, meaning leverage is low.

Companies like Printerra here in Canada are 3D-printing homes in just days, which seems like the highest potential option for big improvement:

A Printerra 3D-printed home

Now, the input-to-output is only one measure of leverage.

Building a home or rental property can generate income for years in the future, so in that sense, construction is a source of financial leverage.

Construction also has boundaries that software doesn't: it's highly localized, so you aren't competing with all other providers in the world, like you are with software.

Like a diversified portfolio, I think having a mix of these kinds of activities is nice: construction and rental income is low-leverage, but low competition and low uncertainty.

Software is high-leverage, but high competition and high uncertainty.

Much of Nassim Taleb's writing (like in Antifragile) focuses on the ideas of leverage, upside, and downside.

Part of what made his books so popular is that these frameworks can be applied to almost everything we do in life.

Have a great week!

Graham

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Links

📚 Book Notes: Antifragile - Nassim Nicholas Taleb - One of the most impactful books (the whole series is excellent) I've ever read.

I continue to see the concepts of optionality, leverage, risk, and non-linearity every day, in all parts of life.

📖 Build Update 4: Framing the Small Shed - The latest update on my DIY build, focused on building the first walls for the smaller of the two sheds.

This one includes a lot of the small decisions I made regarding how I'm planning to build all the buildings, and also all of the initial mistakes I made (thankfully none catastrophic).

🏠 Deconstructed Tiny House Tour - A lot of like about these builds, and they share a lot of things that I'd like to include in my builds.

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Tweet of the Week

Andreesen-Horowitz (a16z), the venture capital firm, published a list of the top 50 AI companies (by startup spend) in the world. Many you'll know, but many others you won't; they're all growing extremely quickly:

Olivia Moore-->

@omooretweets

🚨 Introducing the AI Apps 50: Startup Edition

Ever wondered how startups are spending their money when it comes to AI?

Our team at @a16z worked with @mercury to crunch the numbers and rank the top applications by spend.

The list + what we learned from it👇

12:53 PM • Oct 2, 2025

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