Deep Dive: Zero to One - by Peter Thiel

Deep Dive into the groundbreaking 2014 book which showcased the singular ways to create those new things

Every week I make a personal commitment to learn and grow.

One of the ways I learn best is through the process of chunking.

In cognitive psychology, chunking is a process by which small, individual pieces of information are bound together to create a meaningful whole later in your memory.

I do this by consuming a text and highlighting the main points. Then creating a bulleted guide of those main points. And then rereading that guide several times.

Once I’m able to explain the main points to someone else in detail, I know I’ve retained the information in an effective way.

I will be offering these bulleted summaries to paid subscribers on a regular basis.

My first bulleted deep-dive into Arthur C. Brooks’ book Build the Life You Want: The Art and Science of Getting Happier is available to you today, for free, if you want to learn with me.

If enough people care about this and subscribe, I will invest those revenues to hire more researchers to help me publish more content. I will also look to our subscribers to influence what we research and read out to everyone. 

So without further ado, here is a preview of my deep dive of Zero to One by Peter Thiel

The Challenge of the Future 

• What important truth do you believe that very few people agree with you with? 

  • Tim Ferriss heresies 

• Globalization 

  • Horizontal progress. 

  • Taking things that worked somewhere and making them work everywhere. 

• Technology

  • Vertical, 0 to 1 progress

  • The rapid progress of information technology for example 

• Technology and Globalization 

  • are different modes of progress 

  • But technology matters more 

  • Without technology, globalization will lead to ruin

    • If China doubles its energy production over the next few decades, it will also double its pollution. Only through cleaner energy or more efficient technology can this be assuaged 

All Happy Companies are Different 

• You or your company could create a lot of value without becoming valuable yourself. 

  • Creating value is not enough, you also need to capture some of the value you create 

• “Perfect Competition” is considered the ideal and default state for capitalism 

  • But the dirty secret is no one makes an economic profit under these conditions 

• Be a monopoly

  • Not an illegal bully or government favorite who has lobbied to create a moat for regulatory capture 

  • By monopoly we mean: the kind of company that’s so good at what it does that no other firm can offer a close substitute 

    • If you want to create and capture lasting value, don’t build an undifferentiated commodity business 

• Competitive Lies

  • The British Restaurant in Palo Alto 

    • “No One Else is Doing It” “We’ll Own the Entire Market”

    • That’s only true if the relevant market is the market you’ve identified 

    • What if the market isn’t “British Restaurants”? 

      • The market is “every restaurant in the city”

    • Same with podcasts or media. Your competitors aren’t “other podcasts like yours” 

      • Your competitors are everything else a person who listens to podcasts could do with their time 

  • Create greater abundance, not artificial scarcity 

  • In business, equilibrium means stasis and stasis means death 

  • Every business is successful in that it does something others cannot 

    • Monopoly (of a certain market) is the condition of every successful business 

    • Tolstoy said “All happy families are alike, each unhappy family is unhappy in its own way” 

    • Business is the opposite. 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. 

• Power Law 

  • Less than 1% of new businesses started each year in the US receive venture funding and a total VC investment accounts for less than 0.2% of GDP. 

    • But the results of those investments propel the entire economy. 

    • Venture backed companies create 11% of all private sector jobs. 

    • They generate revenues equal to 21% of GDP. 

    • Together, the top 12 companies are worth $2 trillion (more now), more than all the other tech companies combined