The are many forms of Capital.
Many great thinkers have proposed different conceptualised models. Adam Smith the founder of Capitalism in its modern form proposed 4 types of capital - Financial, Material, Human and Natural. Pierre Bourdieu also had 4 types - Economic, Social, Cultural & Symbolic. Within Permaculture - 8 Forms of Capital (Appleseed) is widely adopted and taught. In fact there are countless models to make sense of this concept.
In my journey down the rabbit hole of understanding the bigger picture of reality and becoming a master at life I found the above models covered it all but didn’t quite capture everything in one tight framework. Hence I propose the following conceptual model to understand the many forms of capital.
Before we dive in let’s define the terms. Capital is anything available to us that we can use, consume or leverage to improve the quality of our lives.
Adam Smith: "That part of man's stock which he expects to afford him revenue."
The most obvious form in the world today is Financial Capital (money and all its derivatives).
But money doesn’t exist in isolation. It is only as good as mans ability to produce. Money is a future claim on goods and services produced through work (human effort over time).
Human effort builds up the world of Material Capital - but we can’t build anything without access to natural (elemental & living) resources, aka Natural Capital.
That material capital, built from the gifts of Mother Nature comes together through the application of Intellectual Capital (the realm of ideas) mixed with Experiential Capital (the realm of action). To build up more complex forms o technology - we leverage Social Capital (our relations with each other) and Financial Capital (money and all its derivates). What we chose to build - is guided by our Cultural Capital (stories, beliefs, values).
When we zoom out we can see the interconnectedness of the many forms of capital. From this elevated perspective we can see a bigger picture with much higher resolution of the whole we are working with. Extrapolate this static picture over time and we can see how each nugget of capital is in a constant flux of dynamic exchange, leveraged to improve the quality of our life.
1. TIME
At the top of the list and centre of it all is time. Time is the common thread that binds us together. It is the only form of capital that is objectively limited to each of our lifetimes - getting shorter every day. There is no topping up our time bank.
Whilst we can’t grow the total amount of time we have here on this earth - we do have a relationship with it and can manage it effectively. All our efforts in building up other forms of capital are simply to give ourselves more time to enjoy life. This is the substrate of all human thought and action existing beyond an indigenous and tribal existence.
How is your relationship with time? Do you feel like you have plenty of it? Or are you always short on time? What steps can you take to manage your time more effectively?
2. SPIRITUAL
Our Spiritual Capital is not some airy-fairy woo-woo stuff - it is our direct relationship with our body and life itself. For some people, this is accessed through organised religion. For others it's a more free-flow and intimate affair that is accessed through our intuition. Spiritual Capital is your connection to life itself. It is life force energy and your direct connection to it is through your living body. This then includes the realm of physical and mental health because your Spiritual Capital is directly tied to your general state of being.
This is the realm of kinesiology and our biology orientating itself to that which is life supporting. Life attracts life and so forth. When our cognitive capacity (aka ego) is operating in service and alignment to our biology - it comes through as intuition.
How is your relationship with the divine through your body and life itself? It there a high state of congruency, alignment and purpose? Or do you feel a lot of internal conflict and dis-ease? What steps can you take to build more harmony, ease and grace into your general state of being?
3. INTELLECTUAL
This is the realm of ideas. Your unique ability for cognitive function. Your awareness of time means you can remember the past, identify patterns and then make predictions about the future. As we seek to make the quality of our life more enriching - we use our intellect to understand the world, and our imagination to remix possibilities.
Once we have learnt something through direct experience (Experiential Capital) - we have the ability to package that experience up into bodies of information that we can pass onto the next generation so they don’t have to reinvent the wheel. This can manifest as formal education or less formal courses and trainings.
Intellectual Capital exists in a constant back-n-forth dynamic relationship with Experiential Capital. Our ideas have no value if they cannot guide our actions.
When doing a stock take of your own Intellectual Capital, take a look at your ability to assimilate new ideas and learn new things. Bodies of information you are officially competent in. EG; university degree, TAFE course and other certificates also count as Intellectual Capital. Do you find yourself lacking in creative ways to solve problems? Or perhaps you give yourself paralysis by analysis? Perhaps you have so many ideas it keeps you scattered and prevents you taking meaningful action!?
4. EXPERIENTIAL
This is the realm of action. Accumulated wisdom and knowing through trial and error. We learn (Intellectual) from the experience of others so we can stand on the shoulders of giants and take human experience to new frontiers. But we will never know if the information is good until we battle test it in the field.
Experiential Capital can only be accumulated through the process of work. An embodied knowing that can only be created through having lived the experience. As we clock up experience - we create bundles of intellectual capital that we can pass on to others - to save them time and having to “reinvent the wheel”.
Intellectual capital might be adopted then then tested in reality, to build up and verify the usefulness of the information through your own experience. This way only the best ideas last thanks to being tested through our human experience.
What unique life experiences and skills have you clocked up in your time here on earth? What problems can you solve based on that unique life experience? What wisdom and insights do you hold from those experiences that you can share with others?
5. CULTURAL
The influential sociologist Bourdieu first introduced the term Cultural Capital - defined as symbols, ideas, tastes, and preferences that can be strategically used as resources in social action. Think of Cultural Capital as the frame you find yourself in.
Collectively, it’s the meta-story we are all embedded within, framed by our culture's dreamtime stories and values. Whilst we are largely confined by the collective globalised western culture frame - there is lots of room to create sub-cultures at an individual, familial, local and regional community level.
Primarily you have the power to create a micro-culture around your being. As you begin to live this you resonate with other individuals who share the same culture - ultimately plugging into or forming a local community or sub-culture.
By far the best framework to understand all the layers of cultural capital at play - is Spiral Dynamics. It clearly shows the meta-story of cultural evolution through different value sets and paradigms for Western Society - and makes obvious why there is so much disparity and conflict within itself.
Permaculture emerged out of the tipping point into green-heart-based-post-modern consciousness in the 60’s and 70’s. It used that cultural revolution as a springboard to flesh out the beginnings of a holistic framework called Permaculture that seeks to integrate the best wisdom from all cultures across all time.
When assessing your own Cultural Capital - look at what values, stories and beliefs you individually hold to be important and true. Compare that with the culture of your collective? Can you plug into and turbocharge other groups or organisations that share the same or similar values which can then support the development of your own cultural capital in the process?
6. SOCIAL
The idea of Social Capital has been kicking around for centuries. Human beings are social creatures. We create social cohesion through the sharing of Cultural Capital, Intellectual Capital and Experiential Capital.
Trust is the ultimate currency in the realm of Social Capital - created through shared experiences of goodwill and reciprocity. Lyda Hanifan is credited with bringing the concept to the forefront in modern times with his article “The Rural School Community Center” - a powerful article and case study that shows how Social Capital is the foundation for all community building.
“I do not refer to real estate, or to personal property or to cold cash, but rather to that in life which tends to make these tangible substances count for most in the daily lives of people, namely, goodwill, fellowship, mutual sympathy and social intercourse among a group of individuals and families who make up a social unit.… If he may come into contact with his neighbour, and they with other neighbours, there will be an accumulation of social capital, which may immediately satisfy his social needs and which may bear a social potentiality sufficient to the substantial improvement of living conditions in the whole community. The community as a whole will benefit by the cooperation of all its parts, while the individual will find in his associations the advantages of the help, the sympathy, and the fellowship of his neighbours.”
Your Social Capital is ultimately measured by who you know and your standing with them. It is unquantifiable in metric terms. It fundamentally exists in the relational field - however, in modern times there are other layers stacked upon that. Bourdieu also proposed Symbolic Capital (official accolades and recognition) as a distinct separate form of capital. I include this in Social Capital as they are simply formal recognitions within this realm.
With the dawn of telecommunications and the internet - our social capital extends to our digital network of contacts and audience online. Some of this is easily quantifiable (eg. the number of followers or contacts), but much of it is not. To help navigate the realms of extended digital social networks - the concept of Weak Ties and Strong Ties helps.
Weak Ties - the number of comments, likes, followers and subscribers on any given platform. The purpose of social media is share our story with a broad reach to find our tribe - but this broad reach ultimately means that most contacts through the socials are weak ties.
Strong Ties - a tighter, more engaged community, with shared values participating in a more engaging and ongoing conversation around a particular topic or theme. Often manifests as a focalised group, paid course or community.
There is a strong argument that Social Capital is the most powerful form of capital in the age of social media and the internet. If you have a large audience and following - you can leverage that to make your wildest dreams come true. To build this audience you must be putting out content that gives value (see 10. Media)
When looking at your social capital - consider concentric rings of influence. Who are the individuals that influence you and your decision-making the most? Who are the individuals that you influence? Who is your audience? Who will listen when you speak? Who are the people you can trust and call on for a favour or to engage to solve a complex problem? What is your reputation - the stories other people say about you? Whether you like it or not - you have a personal brand - you exist in the hearts and minds of others. You can’t control your reputation - but you can control how you conduct yourself in relation with others.
7. NATURAL
These are all the gifts from Mother Nature in their raw form. Primarily elemental and living. All of the raw materials that make up life and life itself. Everything we consume and build comes from this realm. Natural Capital is the physical basis for all Material Capital to be created.
Our modern paradigm in its reductionist approach to understanding the world prioritised the elemental forms to create the incredible achievements of the modern material world. As this paradigm flourish and ran it’s course. There has been a shift in focus back to the importance of Natural Living Capital. Complex ecosystems that perform important ecological functions to keep life on this planet thriving. Permaculture brings the focus back to creating diverse and resilient food systems that also provide ecological functions but can sometimes ignore the importance of mining and extraction of raw materials to make all of the modern material comforts we enjoy today.
When taking stock of your natural capital think of not only the elements and living things under your care - but that you also have access too. EG: you might not have your own garden - but are an active member of your local community garden and therefore have access to all the natural capital there. If you have no access to natural capital - what are some ways you can start to build that up? It might be as simple as growing herbs in a pot - or starting to volunteer at a local farm, landcare group or community garden. (Which will also build up your Social Capital!)
8. MATERIAL
This is the realm of technology and everything man-made. From the most basic stone-age tools to the future sci-fi feats of personal robots. Material Capital can improve the quality of our lives, free up our time and buffer us from the uncertainties of the future. Ultimately all forms of Material Capital are degenerative in someway - and require constant love, care and attention to maintain their form and usefulness. Think of a house - if you do nothing - it will eventually atrophy, decay and be reclaimed by nature. Material Capital is forged by combining Natural Capital with Intellectual and Experiential Capital. As the realm of Material Capital complexified beyond indigenous tribal level existence and we stepped into the realms of larger groups at a civilisation level - the most precious and widely accepted form of Material Capital emerged as Money.
When taking stock of your Material Capital - consider all of the physical tools and technology you have available to you. From hand tools to machines to smart phones. They can all be leveraged to improve the quality of your life and increase your output.
9. FINANCIAL
This is the realm of money and all of it’s derivatives and is a deep topic since most people don’t truly understand what money is. Not often associated together, money is very necessary and permanent aspect of culture - aka Permaculture.
Money is the highest form of energy human beings can channel. Because of this fact dark forces have continued to capture and manipulate it through the ages. Right now we live in a world of broken and corrupted fiat money. Like a fish, it is the water we don’t know we are swimming in. Despite this we all know when there is no money in our bank accounts and we know when prices continue to rise thanks to the printing of new money (aka inflation). If we are half smart about money - we know how much cash is stashed under our pillow… we know how much gold is buried in the back yard - we know how many sats we’ve stacked.
For something to naturally evolve and become money it must perform 3 sequential functions;
Store of Value --> Medium of Exchange --> Unit of Account
We tend to select money that displays certain characteristics to support these core functions. We want our money…
SCARCE - to reflect the scarcity of our time
DURABLE - to move value thru time
PORTABLE - to move value thru space
DIVISIBLE - to scale exchange in size
FUNGIBLE - each unit interchangeable
RECOGNISIABLE & VERIFIABLE - to prove it's true value and authenticity.
Money is the ultimate form of measure in a civilised world. Fiat currency is not money because it fails its core function as a store of value over time (through the printing of money). This is a big part why the world has lost touch with reality. Watch the following 8min video from Robert Breedlove answering the question - What is Money? to get a better understanding.
In addition to the objective facts above - you also subjectively run a money story. That story is probably a mix of 8 archetypes. Understanding which archetypes are the driving force in your money story can help redefine that story if you want to. You can take this quick, easy and free Money Type Quiz to learn your dominant archetypes.
When taking stock of your financial capital - don’t just look at the numbers - take a look at your story money story. Which archetype is driving your story? Are you ok with that? Are your financial holdings the highest and purest form of money? If not are you ok with the risk associated with each derivative?
10. CONTENT
Welcome to the digital age where attention is the new oil. Right now you are consuming a piece of content that I created. l have your attention and this content is doing work for me, impacting you whilst I’m off doing something else. It’s the precursor to time travel.
Content Capital is emerging to be the 2nd most powerful form of capital in the digital age. This concept is best outlined in this short video from Alex Hormozi. An excellent living example of this concept in practice. Even 2 years on - I come back to this video and still get more value out of it.
As this is a new phenomena we are all individually and collectively learning to engage with - I find it helps to frame it back to permaculture terms. If we can shift our mindset from consumption to production we start to see content as a living system in itself.
What type of content are we consuming? Is it sound intellectual capital that is improving the quality of your life? How can you increase your production of content? What story can you share based on your unique life experience? When taking stock of your content capital - think about all of your creative works that you have “put out there”. This includes your website, blog articles, social media posts, videos, audio books and e-books. What have you published? What could you publish? Is this content working for you? Is it helping build your Social Capital?
NOTE: If you have never even thought about producing creative content - and you don’t know where to start… first look at the content you like to consume (not doomscroll content - content that improves your life). Then take a look at your own life experience. What’s some important lessons you’ve learnt that you wish you could tell your old self. The best approach is to remember your audience is your old self. This way we are sharing Intellectual Capital, based on Experiencial Capital in little (and sometimes large) gold nuggets of Content Capital. This process naturally becomes authentic when we realise social media and the internet is an open source journal where we can all openly, authentically and transparently learn from each other.
11. CODE
At the top of the pyramid of leverage is code. More powerful than media - we all engage with Code as a form of Capital in many ways. At the simplest level you might pay for SAAS (Software As A Service) - which automates complex tasks for you. Quickbooks or Xero are great examples of this. It also extends to any form of automation, CRM’s, website builders and ad managers.
As we step into the new wave of AI - the possibilities are endless. If you want to stay on the leading edge - you must figure out ways to leverage AI to automate repetitive and complex tasks you do in front of a computer so that you can life a more enriching life. It is a steep learning curve and requires a new level of thinking and creativity to leverage it properly.
Taking this to the new heights is the ability to write your own code and develop your own SAAS systems. As a Millenial that came of age only engaging with computers as a consumer - this is one area I’ve had to do a lot of work learning the basics - but I don’t let that stop me learning how to leverage what I can. You might think this is not relevant if you just want to get on land, grow food and build community - but I can guarantee you it is. Just try and do that without using all the apps on your phone. You can do it. But it's going to take a lot longer - and require much more work.
When taking stock of what Code Capital you have working for you - start by writing a list down all the SAAS subscriptions you have for free and pay for. Are you utlising that SAAS to its full capacity and its is delivering you value to improve the quality of your life? This space is evolving exponentially - is there now a better, cheaper, faster solution? Do you have the Intellectual, Social and Financial Capital to develop and deploy your own SAAS solution?
That wraps up this piece and perspective on the 11 Forms of Capital and the interconnectedness of everything. I hope you’ve got some value out of it to make better more holistic decisions improve the quality of your life.
Be well. Rupert