“EVERY MOMENT IN BUSINESS HAPPENS ONLY ONCE”.
The next Bill Gates will not build an operating system. The next Larry Page or Sergey Brin won’t make a search engine. And the next Mark Zuckerberg won’t create a social network. If you are copying these guys, you aren’t learning from them. It’s easier to copy a model than to make something new: doing what we already know how to do takes the world from 1 to n, adding more of something familiar.
But every time we create something new, we go from 0 to 1. The act of creation is singular, as is the moment of creation, and the result is something fresh and strange.
Zero to One is about how to build companies that create new things. It draws on everything Peter Thiel has learned directly as a co-founder of PayPal and Palantir and then an investor in hundreds of startups, including Facebook and SpaceX. The single most powerful pattern he has noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas.
Ask not, what would Mark do? Ask: WHAT VALUABLE COMPANY IS NOBODY BUILDING? “– “Thiel starts from the bold premise that we live in an age of technological stagnation, even if we’re too distracted by our new mobile devices to notice.
Progress has stalled in every industry except computers, and globalization is hardly the revolution people think it is. It’s true that the world can get marginally richer by building new copies of old inventions, making horizontal progress from “1 to n.” But true innovators have nothing to copy.
The most valuable companies of the future will make vertical progress from “0 to 1,” creating entirely new industries and products that have never existed before.
Zero to One is about how to build these companies. Tomorrow’s champions will not win by competing ruthlessly in today’s marketplace. They will escape competition altogether, because their businesses will be unique. In today’s post-internet bubble world, conventional wisdom dictates that all the good ideas are taken, and the economy becomes a tournament in which everyone competes to reach the top.
Zero to One shows how to quit the zero-sum tournament by finding an untapped market, creating a new product, and quickly scaling up a monopoly business that captures lasting value. Planning an escape from competition is essential for every business and every individual, not just for technology startups. The greatest secret of the modern era is that there are still unique frontiers to explore and new problems to solve.
Seven Questions Every Startup Business Must Answer
Since 2012, many companies in the “CleanTech Industry” have crashed; gone out of business or filed for bankruptcy because they neglected one or more of the following seven questions:
- The Engineering Question
Can you create breakthrough technology instead of incremental improvements?
A great company should have proprietary technology an order of magnitude better than its nearest substitute. Companies must strive for 10x better because merely incremental improvements often end up meaning no improvement at all for the consumer. Only when your product / service is 10x better can you offer the customer transparent superiority.
2. The Timing Question (chapter 2)
Is now the right time to start your particular business?
Entering a slow-moving market can be a good strategy, but only if you have a definite and realistic plan to take it over.
3. The Monopoly Question (chapter 3)
Are you starting with a big share of a small market?
Exaggerating your business’s own uniqueness is an easy way to botch the monopoly question. You can’t dominate a submarket if it’s fictional, and huge markets are highly competitive, not highly attainable.
4. The People Question (chapter 9 and 10)
Do you have the right team?
Never invest in a tech CEO that wears a suit. The best sales is hidden. There’s nothing wrong with a CEO who can sell, but if he actually looks like a salesman, he probably bad at sales and worse at tech.
5. The Distribution Question (chapter 11)
Do you have a way to not just create but deliver your product?
The world is not a laboratory: selling and delivering a product / service is at least as important as the product / service itself. Technical challenges can be overcome successfully, but its the other obstacles that can not be overcome.
6. The Durability Question (chapter 6)
Will your market position be defensible 10 and 20 years into the future?
Every entrepreneur should plan to be the last mover in her particular market. That starts with asking yourself: what will the world look like 10 and 20 years from now, and how will my business fit in?
7. The Secret Question (chapter 8)
Have you identified a unique opportunity that others don’t see?
Great companies have secrets: specific reasons for success that other people don’t see.
“Zero to One shows how to pursue them using the most important, most difficult, and most underrated skill in every job or industry: thinking for yourself”– Peter Thiel
Conclusion: Stagnation or Singularity?
If even the most farsighted founders cannot plan beyond the next 20 and 30 years, is there anything to say about the very distant future? We don’t know anything specific, but we can make out the broad contours. Philosopher Nick Bostrom describes four possible patterns for the future of humanity.
The ancients saw all of history as a never-ending alternation between prosperity and ruin. Only recently have people dared to hope that we might permanently escape misfortune, and it’s still possible to wonder whether the stability we take for granted will last.
However, we usually suppress out doubts. Conventional wisdom seems to assume instead that the whole world will converge toward a plateau of development similar to the life of the richest countries today. In this scenario, the future will look a lot like the present.
Given the interconnected geography of the contemporary world and the unprecedented destructive power of modern weaponry, it’s hard not to ask whether a large-scale social disaster could be contained were it to occur. This what fuels our fears of the third possible scenario: a collapse so devastating that we won’t survive it.
The last of the four possibilities is the hardest one to imagine: accelerating takeoff toward a much better future. The end result of such a breakthrough could take a number of forms, but any one of them would be so different from the present as to defy description.
Which of the four will it be?
Recurrent collapse seems unlikely: the knowledge underlying civilization is so widespread today that complete annihilation would be more probable than a long period of darkness followed by recovery. However, in case of extinction, there is no human future of any kind to consider.
If we define the future as a time that looks different from the present, then most people aren’t expecting any future at all; instead, they expect coming decades to bring more globalization, convergence, and sameness. In this scenario, poorer countries will catch up to richer countries, and the world as a whole will reach an economic plateau. But even if a truly globalized plateau were possible, could it last? In the best case, economic competition would be more intense than ever before for every single person and firm on the planet.
However, when you add competition to consume scarce resources, it’s hard to see how a global plateau could last indefinitely. Without new techology to relieve competitive pressures, stagnation is likely to erupt into conflict. In case of conflict on a global scale, stagnation collapses into extinction.
That leaves the fourth scenario, in which we create new technology to make a much better future. The most dramatic version of this outcome is called the Singularity, an attempt to name the imagined result of new technologies so powerful as to transcend the current limits of our understanding. Ray Kurzweil, the best-known Singularitarian, starts from Moore’s law and traces exponential growth trends in dozens of fields, confidently projecting a future of superhuman artificial intelligence. According to Kurzweil, “the Singularity is near,” it’s inevitable, and all we have to do is prepare ourselves to accept it.
But no matter how many trends can be traced, the future won’t happen on its own. What the Singularity would look like matters less than the stark choice we face today between the two most likely scenarios: nothing or something. It’s up to us. We cannot take for granted that the future will be better, and that means we need to work to create it today.
Whether we achieve the Singularity on a cosmic scale is perhaps less important than whether we seize the unique opportunities we have to do new things in our own working lives. Everything important to us — the universe, the planet, the country, our company, your life, and this very moment — is singular.
Our task today is to find singular ways to create the new things that will make the future not just different, but better — to go from 0 to 1. The essential first step is to think for yourself. Only by seeing our world anew, as fresh and strange as it was to the ancients who saw it first, can we both re-create it and preserve it for the future.