Zero to One

I typically choose good books to read, and I typically enjoy and learn quite a lot from them. The Zero To One – Notes on Startups, or How to Build the Future (Peter Thiel, Blake Masters, 2014, 224 pages) escapes this rule. Although it contains some great insights, it also exposes some disappointing biases from the author(s).

To start with the good things about the book, I would like to point out to the insights of how innovations can go from “Zero to One” in terms of creating something new. A new market or a new technology. On the contrary, reproducing existing business ideas take them only from “One to N”. The book associates this dichotomy with the idea of competition, meaning that business that really innovate can become monopolists, while those that build on existing concepts typically end up competing their profits away.

I find it insightful the notion that real monopolists try to hide it (e.g., when the search engine dominant Google denied it had a monopolistic position, comparing its own online business success against the whole of the advertisement industry). While those competing in non-monopolistic ways try to show themselves off as somehow unique (e.g., the only “English restaurant in Market Street”). This twist is very interesting indeed.

I also think that Peter Thiel makes a good case about why sales (or distribution, as the book puts it) is so important for tech business as well. And I agree that many good engineers seem to despise sales, while it is something intrinsic and important to any business. Tech included. Don’t expect from this book much practical insights on how to build up a sales force for a tech company, though.

The things I really dislike about the book and which surprises me are the number of biases you can find along it. For example, at some point it states that only computing and telecommunications delivered revolutionary technological changes in the last 50 years. What about the DNA molecule and its later sequencing and cloning experiments? And the multiple new cancer treatments, medicines and mRNA vaccines? Fuel saving cars and jet planes? Fast trains and gigantic ships transporting goods everywhere? To name just a few.

The authors also seem to think that nothing good comes out of Europe. Or nothing new can appear from China, which only copies other countries' technologies. Pointless to counter-argue that Europe is home to many leading technological companies (from chemistry, to food, to automakers), while TikTok, from China, took over a large global position in a way that only American companies typically managed earlier. Similar to what the Swedish Spotify also did in its own market.

In any case, it seems to me that Mr. Thiel takes proud in being or trying to think like a “contrarian”. Although I certainly see the merits in trying to think outside conventions, one needs to be careful not to make assumptions on topics one has limited knowledge about. Otherwise, a contrarian view of the world can very quickly become a false or biased view of the world. To be a contrarian imposes even greater responsibility in trying to amass as much information as possible about other fields, before trying to connect the dots into what most people may be ignoring about how things really are.

In any case, I think the book is relevant because of the power position the author has. It also can shed some light on Thiel’s previous partner Elon Musk and his recently behavior when taking over Twitter. For example, Musk insisted in freedom of speech before Twitter's acquisition (while the platform was already a space where freedom of speech thrived), and unfortunately the buy-out only resulted (at least by the time of this writing) in a deterioration of this very principle, with severe personnel reductions and allowing extremists to act and harass much more freely. If being a contrarian includes supporting conspiracy theories and a chauvinist worldview, so it is clearly not a good thing to be. In any case,  there are some good insights in the book, although it as a whole needs to be taken with a sizeable pinch of salt.

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