This book by Peter Thiel is unusually dense. On the Parato-scale I would give it a 60/40. This is a must read for everyone. For those of you who do not know who Peter Thiel is; in short, he was the co-founder of Paypal, and went on to found Clarium and Palentir. He was also the earliest angel investor in Facebook.
What important truth do very few people agree with you on?
Peter Thiel is a contrarian and a visionary thinker. His book will inspire you to grow both financially and personally.
Horisontal progress is easy to imagine, but vertical progress is another ballgame. That is when you need to think or do something that has never been thought or done before. I find this book to be a huge brick in the path to thinking vertically.
Peter Thiel has some, at least for me, surprising perspectives on competition. He likes monopoly and argues that the ideology of competition preached by the education system is a mistake. Competition leads to worse economy and worse products. And, something I believe he didn’t mention; worse use of the worlds resources. He argues that if companies are free of the waring competition, they are free to innovate and invent.
So, in essence we should try to create endeavors so unique that rivals cannot enter.
Non-monopolists tell the opposite lies of monopolists by saying they are in a league of their own. Entrepreneurs are biased to understate the scale of competition. It is the biggest mistake a startup can make. The fatal temptation is to describe your market extremely narrowly, so that you dominate it by definition.
The creative industries work this way too. The screenwriter doesn’t want to admit that her movie script simply rehashes what has been done before. So, the pitch is; this film will combine various elements in entirely new ways. Non-monopolists accentuate their distinction by defining their market as the intersection of various smaller markets. Monopolists by contrast disguise their monoply by framing their market as the union of several large markets.
His critique on the current education system resonnates with me as well. I know the education system in Norway from the inside, and frankly in many aspects it produces unambitious, lazy, horisontal thinking, status driven and superficially skilled people.
Believe that there are more secrets in the world! Look at everything like it is new.
Start small and dominate your niche before entering into harder and larger markets (eg. Facebook). Choose your markets carefully, and expand deliberately.
Focus on substance before branding.
Talented people do not need to work with you. If you want to collaborate with someone on your film project, you must find the answer as to why this person should work with you.
Focus relentlessly at something you are good at doing, and before that you must think hard whether it will be valuable in the future. Do not diversify what you do in order to create something to ‘fall back on’.
Dogmas after the dot-com crash:
Make incremental advances.
Stay lean and flexible.
Improve on the competition.
Focus on the product, not sales.
Peter Thiel kind of gives Eric Ries a kick with his new contrarian principles:
It is better to risk boldness than triviality
A bad plan is better than no plan.
Competitive markets destroy profits.
Sales matters just as much as the product.
Seven questions that every founder should answer before starting a business:
The Engineering Question: Can you create breakthrough technology (vs. incremental improvement)?
The Timing Question: Is now the right time to start this particular business?
The Monopoly Question: Are you starting with a big share of a small market?
The People Question: Do you have the right team?
The Distribution Question: Do you have a way to not just create but deliver your product?
The Durability Question: Will your market position be defensible 10 and 20 years into the future?
The Secret Question: Have you identified a unique opportunity that others don’t see?
Finally, I found it enchanting to read about Peter Thiel’s perspective on being a definite or indefinite pessimist or optimist. Why? Because I felt that he put words on my own personal development, having become a definiteoptimist, or at least close to it. There was a time when I was an indefinite pessimist. Do whatever you can not to be there! Reflecting on this is an absolute must!