We are all entrepreneurs

Despite my own misgivings about Peter Thiel’s political contributions, I have been interested in reading his book “Zero to One” for a while now. It is marketed as a book of lessons Thiel has collected over his time starting PayPal and Palantir, and is a condensed version of a course he taught at Stanford on how to build successful companies. The book has been recommended to me several times, and my own experiences in entrepreneurship makes “Zero to One” particularly intriguing. At first I was skeptical about how useful a book about startups could really be, but I found myself pleasantly surprised at how Thiel’s advice on technology companies could be applied to creativity and thinking in general.

Thiel can certainly be criticized for being too vague, or spending so much on his own accomplishments so as to make his points in the book less relatable to a wider audience. However, there are still many instances where Thiel does offer straightforward, and tangible pieces of advice that I now consider to be crucial for any of my future entrepreneurial endeavors. For example, Thiel notes the importance of trying to find only one or two distribution channels, using the metaphor of a Power Law distribution from statistics. He argues that the majority of the rewards from distribution will only come from a few channels, and that it is in a company’s best interest to single those out, rather than chase after several. He extends this idea further, pushing the reader to build startups that focus on extremely small markets first, before scaling up. Additionally, when it comes to building economies of scale, one of the characteristics of a company that Thiel states as being helpful for its ability to grow aggressively is whether or not it has network effects (as more people use the product, the more valuable the product becomes).

These are all simple ideas, but I found them extremely valuable when thinking about the process of starting a company. It is easy to get overwhelmed at almost every stage of the process. There are countless decisions to be made, with each one seeming to have profound impacts on the potential trajectory of the company. It is tiresome to isolate and determine what exactly it is one should do. This is the value of Thiel’s ideas; he presents a general philosophy that one can use to think about any new decision that comes along, rather than state explicitly what one should do every step of the way. To think of this book as a manual for how to build a successful technology company is wrong. “Zero to One” reads more like a treatise on how to think more clearly about one’s work.

Indeed, the central idea of the book (building something when there was nothing is difficult and valuable), is a point that can be easily applied outside of technology startups. Going from Zero to one, quite literally, is where all the interesting things happen, in any field or industry. When I think back to my history classes, the events that the professor’s were most interested in were those that marked drastic changes in people’s lives, things that were not just slight improvements to the status quo. Consider the invention of the steam engine, the internet, or the telephone. We are intrigued by new modes of art, and unexplored genres of music. It has become my goal to make sure this insight begins to permeate in all of my projects moving forward, and that with every idea, I do not just try to make something better, or copy others with variations, but rather see if there is an utterly new mode of thinking.

There are many other interesting perspectives from “Zero to One” that should be taken outside the field of startups. One of them is Thiel’s distinction between Positive Definite and Positive Indefinite people. Both types of people feel like the future will be positive, but the “indefinites” are not sure how it will be so. This speaks to a general flaw in our thinking as a culture and society; we almost naturally assume that things will get better. “Someone else will build it”. “Progress is always upwards”. But this is lazy thinking. Sure, some things do get better over time on their own. Popular and effective ideas linger and improve due to some sort of memetic evolution. However, true advancement of our species will take too long with this attitude. We often think about how far we have come, and appreciate how much more freedom, power, and happiness we have compared to our ancestors. But by patting ourselves on the back we fail to see how much brighter our future could be. We could merely be at the start of an exponential curve of progress.

To think of things in this new way represents an entire change in the way one thinks about the ecosystem they reside in. Thiel offers some other examples of how a change in perspective can alter our understanding of reality. Think of Google. From one perspective, it is a generic technology company, with its hands in a ridiculously large number of industries (automobile, advertising, email, etc). It only takes up a small fraction of the total market in all of those industries. But if we think of it as only a search company, Google becomes a clear monopoly. Thiel reminds us of how powerful a change in outlook can be. Consider iRobot. Is it just a company that builds vacuum cleaners, or are they a company that will build a new generation of smart home devices? This idea can be taken to research as well; is finding more efficient renewable energy a way to make money, or to save the planet? Depending on how you frame the question, the research avenues, and solutions you explore will be wildly different.

Another change in thinking that I found valuable was how Thiel talks about “secrets”. It can be easy to think of “Zero to One” as meaning that every successful company must build something entirely unforeseen. But again, that would be an incorrect interpretation. In reality, novel ideas are things that are discovered. They do not come out instantly, perfectly formed in one’s mind, but rather from a culmination of experiences all coming together to provide a unique way of looking at something. The band “OK go” is well known for their creative music videos, and they describe coming up with the ideas for those music videos as if they were looking through a telescope. When they aim the telescope just right, and the planets and stars are lined up in a particular way, they reach an insight. This is an absolutely liberating way of thinking about creativity. It can seem like an insurmountable task to simply think, and then all of a sudden create something new. However, if we frame it as an exploratory question, it becomes easier, the pressure is taken off. It is more forgiving of bad ideas, and encourages curiosity. If one lives their life believing that there are many secrets to be found, and is dedicated to trying to find them, this will lend itself to a life of exploration and growth.

And while finding such a secret may lead to a great company, the search itself for a secret will lead to a more interesting life.