Legendary startup icon and venture capitalist Thiel and Masters reveal how they succeed with startups and why business school graduates most often do not.
Known as a co-founder of Paypal and early investor in Facebook and SpaceX, billionaire Thiel and his former student, Masters, are not offering tips on becoming superrich. Surprisingly, they are contemptuous of finance, which they call “the only way to make money when you have no idea how to create wealth.” They offer an older model of business based on the potential earnings foreseeable as a by-product of the transformations associated with leaps in technology into unserved spaces in human activity. Paypal and Facebook are good examples. The authors distinguish their own thinking and methods from the orthodoxies of the financial and business communities. Lively and often acerbic, Thiel and Masters leave many of today's business shibboleths trashed along the way. They are unabashed proponents of monopoly to control and secure profit for reinvestment, and they assert, agreeing with thinkers like Walter Lippmann, that “[c]apitalism is premised on the accumulation of capital, but under perfect competition all profits get competed away.” In their view, monopoly is how technological innovators successfully change the rules with order-of-magnitude improvements instead of incremental advances. Thiel and Masters provide rules of thumb and case studies drawn from experiences, all bound up with their radically different business methods and practices. Their views on viral marketing and the importance of sales will be of interest to aspiring entrepreneurs, as will their dismissal of current ideas of market and technological disruption. They don’t hide their dislike of the use of stock options as incentives for business leadership.
Forceful and pungent in its treatment of conventional orthodoxies—a solid starting point for readers thinking about building a business.