“Zero To One”, by Peter Thiel
I recently read Peter Thiel‘s book Zero To One. There are some great insights in the book even if a lot of it is theoretical rather than proven. Particularly, I like the way he frames monopolies in a positive light. I believe he is right in saying that if a monopoly ‘behaves well’ they can certainly add more value than many competitive companies can due to continued innovation and long term strategy. I no particular order, some of the particularly interesting ideas were:
1. Monopolies are good. Monopolies reward innovation and can create enough capital for long term planning as opposed to incremental strategies.
2. If a monopoly creates value, then people will still love that monopoly. Apple and Google are examples.
3. Characteristics of a monopoly include, proprietary technology, network effects, economies of scale and branding.
4. Software companies are particularly good at economies of scale which allows for very scalable, global reaching companies.
5. A power law exists almost anywhere you have to allocate resources. For a startup, a significantly high proportion of income will come from a small proportion of customers.
6. A startup doesn’t have a culture, it is a culture. Hire people who breed the mission.
7. Everybody sells.
8. Successful companies succeed in: engineering, timing, creating a monopoly, building a great team, finding a distribution channel, gaining defensibility and knowing something that no one else knew.
9. In order to succeed you have to improve a solution on some level by an order of magnitude.
10. Do one thing. Give each staff member just one thing to do. If you give them many things they’ll put off the difficult one indefinitely.