Book Summary

8 questions about entrepreneurship that Peter Thiel answers in his book will guide you to building your startup that sees vertical progress.

What is zero to one?

“Doing what we already know how to do (copying a model) takes the world from 1 to n. But every time we create something new, we go from 0 to 1.”

What is the book about?

This book is about the questions you must ask and answer to succeed in the business of doing new things. It is an exercise in thinking.

Why is technology miraculous?

“Technology is miraculous because it allows us to do more with less.”

Is there a formula to entrepreneurship?

“There exists no formula to teaching entrepreneurship, because every innovation is new and unique, no authority can prescribe in concrete terms how to be innovative. Indeed, the single most powerful pattern I have noticed is that successful people find values in unexpected places, and they do this by thinking about business from first principles instead of formulas.”

What is the contrarian question Peter asks when interviewing?

“What important truth do very few people agree with you on?” he illustrates this with an example of the dot com bubble where entrepreneurs who stuck to Silicon Valley learnt the following lessons.

                Make incremental advances

                Stay lean and flexible

                Improve on the competition

Focus on product, not sales

These lessons have become a kind-of philosophy he says nd yet the opposite principles are probably more correct

                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 product

What is The definition of a startup

“A startup is the largest group of people you can convince of a plan to build a different future. It must question received ideas and rethink business from scratch.”

Why is monopoly better than competition?

“if you want to create and capture lasting value, don’t build an undifferentiated commodity business. The competitive ecosystem pushes people towards ruthlessness or death. All happy companies are different: each one earns a monopoly by solving a unique problem. All failed companies are the same: they failed to escape competition.”

What are the characteristics of monopoly?

• Proprietary technology

The advantage of this it makes the product difficult or impossible to replicate.  Example: Google

• Network effects

They make a product more useful as more people use it. Example: Facebook

• Economies of scale

A monopoly business get stronger as it grows bigger. Example: software startups.

• Branding

A company has a monopoly on its own brand by definition. So creating a strong brand is a powerful way to claim a monopoly. Example: Apple

What is the Last mover advantage?

Generating cash flow is critical. The way to do that is dominate a small niche and scale up from there, towards your ambitious long term vision. That is to make the last great development in a specific market and enjoy years or even decades of monopoly profits.

Luck or Chance is not a factor in success is the idea that Peter Thiel stresses over and over. He has faith in hard work and careful planning. The essential first step to create new things is to think for yourself.

What do you believe? DO you agree? Whether we agree or not, believe or not, we have to agree that Peter Thiel has the power to make us think.

Happy reading!!

Further Reading