Zero-One

Main Theme:

• Zero To One = Creating something NEW vs. copying things that work

• How to build and scale a business that will thrive for decades

Key Takeaway #1 – Build a creative monopoly instead of trying to compete

• Capitalism = profits get competed away, Monopoly = keep profits

• If you want to create a business that will stand the test of time, don't build an undifferentiated commodity business (e.g. mortgage company)

• Creative monopoly = new products that benefit everybody and sustains profits for the creator.

• Competition = no profits for anyone, no meaningful differentiation, and struggle for survival.

• Four characteristics of a monopoly:

• Proprietary technology (PayPal)

• Network effects (Facebook)

• Economies of scale (programmers versus yoga instructors)

• Branding (Apple)

Key Takeaway #2 – Find the perfect market

• The perfect market = small group not served by competitors

• Scale into slightly broader markets

• Don't disrupt – avoid competition

• Last mover advantage – if you make the last great development in a market, you'll enjoy a long sustainable profits

• If you focus only on near-term growth and profits, you'll miss the most important question which is: will this business still be around decades from now.

Takeaway #3 – Every business must answer these seven questions

1. The engineering question – can you create breakthrough technology instead of incremental improvements.

2. The timing question – is now the right time to start your business?

3. The monopoly question – are you starting with a big share of small market?

4. The people question – do you have the right team?

5. The distribution question do you have a way to not just create but deliver your product?

6. The durability question – can your market position be defensible decades to come

7. The secret question – have you identify the unique opportunity that others don't see?

Final Thoughts

• Innovate or die – Zero To One.

• Dominate, don’t compete.

• Put a lot of thought into the beginning – 3 characteristics of a monopoly and 7 questions of successful businesses.