Please explain this proverb" Tell me who your friends are, and I will tell you who you are".

I'm gonna explain it as best I can.
Usually people tend to hang out with those who're similar to themselves.
It is easier for them to meet and keep in touch with those who are in the same background or level. Even if it is not the case of someone, still it is possible that they get affected by their friends either good or bad ways. Therefore, you can say peopel=people  in the same group tend to resemble each other. I don't know who said this or when it was said but I agree with this notion.