"Success leaves clues." This was a quote I heard years ago and it has stayed with me since. As they say, a smart man learns from his own mistakes; a wise man learns from the mistakes of others. That’s why the subject of today’s post is Peter Thiel, one of the most successful entrepreneurs in the world. His life and his business sense can offer a lot of lessons for people about success in the business world.
You may have heard of Thiel, he was a founding member of PayPal and the first outside investor in Facebook. As you can imagine, these ventures made Thiel a very wealthy man. As of July 2016, he had an estimated net worth of $2.7 billion at 48 years old.
https://www.amazon.com/dp/B00J6YBOFQbrus
Thiel has also released a best-selling book called Zero to One: Notes on Startups, or How to Build the Future. In it he spells out his business philosophies and the lessons he has learnt over the years.
Thiel has also become famous, or infamous, for some of his political and personal choices. However, these do not negate the lessons you can learn from the philosophies that have made him such a success in the business world.
As the great Bruce Lee said, “Absorb what is useful, discard what is not”.
Standing out is one of the Peter Thiel’s business lessons.
Lesson #1: Don’t Be a Copycat
Peter Thiel stresses originality as one of the key factors of success. He cites as an example the fact that too many people are trying to ‘recreate Google’, and identifies it as a key cause of business failure. Thiel candidly says that the ‘next Mark Zuckerberg’ won’t be building a social network.
“All of the great innovations in business and technology happen once," Peter Thiel says in his book. Companies like Facebook, eBay, and Airbnb are the dominant leaders in their niche, and no one is going to dethrone them anytime soon. That's why he teaches that it's better for people who want to make their own success to look elsewhere.
And while this advice might seem to be directed at people who are making huge contributions to the world, this doesn’t mean it can’t apply on a smaller scale too. This advice should encourage you to look more closely at your own skills and abilities. What skills do you have that separate you from the pack? It may not be any one skill, but a unique combination that could lead you to an original idea or niche. And when you’ve identified where you can add value to the world, you can then work on dominating that niche, which leads to the second lesson.
Lesson #2: Be a Monopoly
The word monopoly has always had a bad reputation. Since the early 20th century, when US President Teddy Roosevelt took on the monopolistic trusts like Rockefeller’s Standard Oil Company, monopolies have been under attack by the general public.
This reputation is worsened by the tenets of our capitalist society, which strongly preaches the importance of competition. According to these ideals, competition makes us stronger and is good for the public. But Peter Thiel strongly disagrees, saying that entrepreneurs who enter into highly competitive markets find their profits eaten up by bigger and better financed rivals.
“The goal of every entrepreneur who starts a company is to create and build a new monopoly," Thiel says. “If you want to have a successful company, you should have a monopoly." Companies such as Google would seem to support the idea that this is a highly profitable way to do business.
And how does this apply to you? Again, being a monopoly does not necessarily mean being a giant global conglomerate. Rather, you can be an effective monopoly by dominating your niche no matter how small it is. For instance, your niche might be repairing garage doors in a small suburban town and this is hardly a large market. But if you’re the best at doing it, you’ll still be doing well.
Peter Thiel teaches that you have to start small, but think big
Lesson #3: Start small but think big
The third lesson follows on from the second. If you focus on the small markets, you need to plan to dominate that market completely. This allows you to start small, with manageable goals that can expanded on as your business grows. Too often, Thiel says, entrepreneurs are drawn to the lure of large and established markets when they should be looking smaller.
Take Amazon as an example. Its creator, Jeff Bezos, wanted to dominate the entire online retail market. But when he started out, he started small by focusing on the online book market. From these relatively humble beginnings, Amazon has now become one of the largest retailers in the world. And this is just one example of what can happen when you start small, but have big plans.
Lesson #4: Be Bold
After the dot-com crash, many entrepreneurs and investors adopted a very cautious mentality. One key feature of said mentality was only making small incremental advances in their business. Thiel lampoons this conservative mindset and says that it’s far better to ‘risk boldness than triviality’.
Of course, this doesn’t mean throwing caution to the wind completely, boldness does not mean being foolhardy. But no one ever achieved great things by playing it safe all the time. Everything in life, especially success, involves risk. And as the saying goes “Fortune favors the bold”.
Lesson #5: Sales Matter Just As Much as the Product
Another remnant of the conservative mentality that Peter Thiel lambastes is the focus on product over sales. He claims that many companies keep trying to build the perfect product, relying on the idea that ‘if you build it, they will come’.
It might happen that way for some people, but most of the time this is a pipe-dream. You can build one of the greatest products or offer one of the greatest services ever, but if no one knows about it, nobody will come. That's why Thiel states that sales and marketing are just as important as the product.
This is even more important if you're an entrepreneur or small business owner. And even if you’re in the corporate world, it's just as important to market your skills so you can move up the ladder. Whether you agree with this mindset or not is irrelevant; it is simply the way the world works.
Lesson #6: Think Long Term
As attention spans shrink all over the globe, so do the timelines on our goals. Too many people have a ‘live for the moment’ mentality, aptly summed up by the obnoxious cry of YOLO. This mentality is often applied to goal setting, to business decision, and in life in general. Well, Peter Thiel has an equally catchy saying for his mindset, “Remember the future”.
In relation to business investments, Thiel asks you to ask yourself the question “Will this business still be around a decade from now?” In this context, he was speaking from the perspective of a venture capitalist, but it is a question you should be asking yourself when considering any business venture.
The number one thing you can take away from this
When studying the lives and careers of people like Peter Thiel it is important to remember that he is still only human. He is not perfect, he has made mistakes, and no doubt will continue to make them in the future. That's why it's important that we not try to copy his life or even his business mentality. Instead, we can do our best to learn from his example, to work out how his philosophies might fit into our own lives. That way we ensure that we become the best we can, without becoming nothing more than a copycat.
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