Source: Kigaku Club
PayPal's co-founder Peter Thiel is Silicon Valley's most successful and legendary investor. Some of his own opinions on investors are also very worth learning from.
1. Actively think about the future
1. Independent thinking is not an imitation, but a maverick
What people need is not imitation, but maverick behavior.
Innovation is not about finding ways to find a fixed model for success, because no such model exists.
One of the major challenges of innovation and entrepreneurship is to find your own differences and find fields that others haven't discovered or even thought of to start a business.
As long as you start a business, you will face competition. It's very difficult to succeed in a competitive environment. For example, competition in the restaurant industry is very fierce, and it is very difficult to make a profit in the restaurant industry.
Those big, very successful companies are all in some monopoly areas, and they adopt practices that others have never done before. For example, Google has a very large monopoly position in the market and competed with Yahoo in 2002, but later it became a monopoly company in the US and Europe in terms of search engines.
How to break this model where everyone competes in one field and find some new fields? Peter Thiel believes that imitating others is not a good way to break through and innovate because you don't always think independently from your own perspective.
To date, the vast majority of companies have been imitative, and few have innovated too much. Most of those particularly valuable companies are companies that can make big breakthroughs.
2. Fashionable often means unspecial
Every important moment in the history of technology and business comes only once. The next Bill Gates won't develop an operating system; the next Larry Page won't create a search engine; and the next Mark Zuckerberg won't build a social network.
If anyone else is imitating these people step by step, that must be a bit of a problem.
Most of the time, people have a “sheep mentality,” which doesn't mean that the public must be wrong. It would be quite nice if a large wave of people could make their own judgments independently. The problem, however, is that in most cases, judgments are not made independently; people always look to others.
When people chase something like a flock, there is a “premium effect.”
Everyone is talking about “trends” now. But every trend people hear is probably being overvalued, such as SaaS, big data, cloud computing, etc. If you want to start a business, you'd better think in reverse (contrarian thinking) — the farther away you get from these buzzwords, the better.
2. Continuously surpass oneself
1. Think outside of inertia
Peter Thiel is not only a thinker, but also a practitioner. Because practice fed back ideas, his transcendence had greater realistic power and lighthouse effect.
The methodology of “self-transcendence” is: breaking out of the current logical framework, reorganizing and reconstructing the world in a large spatial and temporal dimension; rearchitecting logically in a meticulous form to obtain a higher dimensional perspective and develop a rescue strategy; breaking out of mental inertia in the process of continuous upgrading and restructuring to continuously achieve self-transcendence.
For example, we often think that competition is the essence of business, and even to defeat our rivals, we focus all our energy on competition, but if we cannot win quickly, it will only lead to the consumption of value rather than the creation of value.
Therefore, Peter's attitude towards competition is: if you can't beat your opponents, join forces. At the beginning, Peter Thiel and Elon Musk created Paypal.
2. Thinking outside of inertia, how should we view monopoly
How to achieve a monopoly? Many people's first thought is to occupy a huge market. However, according to Peter Thiel, the first step in monopoly is not to rush to occupy a huge market, but to occupy a large share in a relatively small market.
Every startup starts small, and every monopoly company needs to dominate the market, so to be a good startup, you need to monopolize a small market from the beginning.
This is the case with PayPal. They initially targeted 20,000 small stores on the eBay website to determine this target customer base, and their market share grew from 0 to 40% in 5 to 6 months.
Once you have a monopoly on a niche market, you should gradually expand into related and broader markets. Bezos founded Amazon to monopolize online retail, but he deliberately started by selling books. Appropriate methods are needed to sweep up the market. Gradual expansion requires strict discipline, and a specific market must be monopolized before expansion.
3. Of anything that others believe in, there is no value that can be created
Ben Horowitz, a top investor in Silicon Valley, also said that what everyone wants to hear is: they already believe something “true or true”; what they don't want to hear is a unique opinion that goes against their cognitive system.
But of everything anyone else already believes in, there really isn't any value that can be created; this is true of everything in the business world.
Peter Thiel believes that all startups are founded on a secret, and behind every company there is a so-called “secret that is close in sight, but no one knows it.”
edit/lambor