Aim to build a monopoly - Deepstash
Aim to build a monopoly

Aim to build a monopoly

Aim to build a company that is so different and ahead of the others that it's not even competing.

A monopoly enables you to:

  • Allocate more resources towards innovation and long-term plans.
  • Stop focusing on generating revenue to survive.

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MORE IDEAS FROM Zero to One

Create the future

The future is a time when the world looks fundamentally different from today.

We need two types of progress to create the future:

  1. Horizontal progress/Globalization (from 1 to n) - Copying things that work somewhere and making them available everywhere.
  2. Vertical progress/Technology (from 0 to 1) - Doing new things that nobody else has ever done.

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Seven questions every business must answer
  1. Technology - Can you create a breakthrough technology instead of incremental improvements?
  2. Timing - Is now the right time to start your particular business?
  3. Monopoly - Are you starting with a big share of a small market?
  4. People - Do you have the right team?
  5. Distribution - Do you have a way to deliver your product?
  6. Durability - Will your market position be defensible 10 and 20 years into the future?
  7. Secrets - Have you identified a unique opportunity that others don't see?

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Peter thiel

No company has a culture; every company is a culture. A startup is a team of people on a mission, and a good culture is just what that looks like on the inside.

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Proprietary technology

Proprietary technology is a great advantage on which you can build a monopoly business because it makes it difficult for other companies to replicate your product.

However, for proprietary technology to offer an advantage, it needs to be 10x better than existing solutions. You can achieve this by inventing something new or radically improving an existing solution.

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Get the right co-founder

Choosing a co-founder is a crucial decision at the start of every company - one that's very hard to correct. You should team up with someone that has complementary skills and with whom you share a prehistory.

A great founding team is critical for the success of the startup. They draw people in with their vision, get alignment across teams, inspire loyalty, and bring out the best work from everybody.

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Future value

The value of a business today is the sum of all the money it will make in the future. Great businesses have the ability to generate significant cash flows in the future.

This explains why promising tech companies have such high valuations. Most of that value will come 10 to 15 years into the future.

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Peter thiel

A startup is the largest group of people you can convince of a plan to build a different future.

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Do your own recruiting
  • Attract people by explaining why your mission is compelling and why your company is a unique match for them.
  • Select only people that match your criteria and can be involved full-time.
  • Build a team of skilled people that can work together cohesively.

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Cash vs. Equity

You need to get the right balance between cash and equity when rewarding employees:

  • Cash is about compensating people for the job they are doing today.
  • Equity orients people toward increasing the company's value in the future.

High cash compensation teaches employees to claim value from the company as it is today, instead of investing their time to create new value in the future.

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Competition is for losers

Competition narrows your focus on beating the other companies. While this makes you good at that which you are competing on, it doesn't guarantee success.

You risk losing sight of the big picture and of what is important for future growth, if you keep relating to what your competitors are doing.

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Start with a niche market

Startups should start with a very small market because it's easier to dominate than a large one. Once you dominate it, scale up and move into adjacent broader markets.

The perfect target market for a startup is a small group of particular people that are served by few or no competitors.

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RELATED IDEA

Zero to One is about how to build companies that create new things

The book draws on Thiel's experience as a co-founder of PayPal and Palantir, investor in hundreds of startups, including Facebook and SpaceX. Thiel cautions the book offers no formula for success. Such a formula cannot exist as every innovation is new and unique. 

The 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.

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Going from one to n is just a start of another new business which is already existing in the market. You are building something which is not unique, which is not something people can say 'okay this is something new in the market'.Its just another service from another brand.

Going from zero to one is a process where you have unique idea which was never build, never used. You make something new that gives value to people.You start something which can overcome some large and real world problems.

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A better way to live...

Houses of tomorrow: A more hopeful vision of domesticity, or a dystopian nightmare?

In the future, will we find a better way to live, or will our homes be taken over by surveillance and despotic appliances?

Imagine, if you can, a small, bluish room. Wires, screens, sensors. A few keepsakes from the old world. The room’s fleshy inhabitant, confined indoors by a zoonotic pandemic, greenwashes a data-mining company from her bed. The government has made it illegal for her to step outside.

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