7 ms·

Key Takeaways from Zero to One

124 points by Jakkaps 8y ago

stcredzero 8y ago
People have too much faith in their opinions. Exempting yourself from a general human behavior is dumb... That second phrase is gold!
- x220 8y ago
  This sort of thing always comes up when I talk to my friends about marriage. I tell them that I'll never get married because of the divorce statistics, and they tell me that only dumb foolish people get divorced. I tell them "how do I know I'm also not a dumb foolish person or whoever I marry isn't a dumb foolish person?" I haven't found an answer to that yet. Genuinely not trying to start a flame war, just trying to make an interesting point.
  - jliptzin 8y ago
    That’s the kind of observation I’ve come to appreciate the older/wiser I get. You start off life feeling invincible, that those kinds of stats won’t apply to you because you’re not a fool like everyone else. But eventually you learn to pay attention to the stats because much more often than not you fall pretty close to the center of the bell curve for most things in life, no matter what.
mrfredward 8y ago
One of my favorite points in the book is the explanation for why any sort of niche small business software sucks. In consumer software, customer acquisition cost is low and development costs can be spread over millions of people, so there is a big profit potential even though the price is low. For large enterprises, the customer acquisition cost is high (lots of meetings with suits), but the payout is high (millions of dollars is good value for software that is going to be deployed at 20,000 locations and serve millions of customers). For a small business, customer acquisition is still expensive (sales and support done personally), but the price is still pretty low. The book cured me of mumbling "I could make software better than that in a week" every time I saw a receptionist at a small office struggling with a bad app.
- stcredzero 8y ago
  The book cured me of mumbling "I could make software better than that in a week" every time I saw a receptionist at a small office struggling with a bad app. What if the acquisition cost could be made low? Doesn't patio11's appointment reminder app fall into this category? https://www.indiehackers.com/interview/how-i-grew-my-appointment-reminder-business-to-12k-mo-2b8720ca25 https://www.indiehackers.com/interview/how-i-grew-my-appoint...
  - rpeden 8y ago
    It might. He talks about revenue but not about profit. So we dpn't really know much about his costs, aside from him mentioning that he was spending a meaningful amount on insurance. It could very well be that acquisition cost was quite reasonable, and he may have talked about this elsewhere. I just don't think the IH interview tells us enough to know for sure one way or the other.
    - simonswords82 8y ago
      He's published a huge amount of detail about revenue and costs, his profits aren't enough to sustain a family. I say that with the greatest amount of respect for the man by the way, he's super super smart and I love his writing.
  - TrevorAustin 8y ago
    Probably not, given that he abandoned the app and works at Stripe now.
  - coldtea 8y ago
    It can be great even if the "acquisition cost" is high, assuming you charge people for it. It just doesn't lend itself to the "do a business that sells $10 dollar bills for $5 funded by VC money until it has enough eyeballs to start selling ads".
  - simonswords82 8y ago
    I learned the hard way that "passive income" via SaaS is fools game. Yes it does exist, but it's incredibly rare and so it's very unlikely that any idea I have is going to be the unicorn idea that generates a shedload of money for minimal effort. I stand about as much chance of becoming the next YouTube/Insta star.
api 8y ago
"From what I’ve observed, really smart people tend to be right, and you can safely accept their viewpoints." What? I couldn't believe this statement. It completely neglects the massive differences that exist between people of any intelligence in terms of what and how they think. I'm talking about things like educational level, ideological biases, epistemological approaches to thinking, etc. It also completely neglects the honesty and integrity of the person you are emulating. To give just one example: I've found that most of the "conspiracy nuts" I've met (people who think we didn't go to the Moon, etc.) are highly intelligent, probably pretty far above average. If anything being highly intelligent makes it much easier to rationalize a ridiculous belief system. Any idiot can imagine a round Earth that spins and orbits the sun but it takes someone with very high intelligence to understand ether vortex theory. Judging by the intricacies of their speculations the "bakers" who assemble bizarre far-fetched conspiracy theories out of QAnon's cold reading act are also quite intelligent. Con artists also tend to be highly intelligent, hence my comment about honesty and integrity. For some odd reason it seems like a whole lot of very bright people have adopted this weird kind of biological determinist hard materialist view of cognition and its quality. By materialist I mean it reminds me of Marxist dialectical materialism: the idea that the state of society is a pure function of its technology and other capital. A bunch of people think you can measure someone's IQ and that will tell you how correct their opinions are. Smart people have better opinions because they can think more faster, or something. I struggle to understand how anyone could possibly believe this. It's patently absurd. It's roughly analogous to saying you can tell the quality of a driver by the performance of the vehicle they are driving, or that the correctness of a computer's output is a pure function of processor speed irrespective of what software it's running.
- 00N8 8y ago
  I agree. At best the argument that you can trust "smart" people is circular: that smartness is a socially constructed measure of how "good/right/clever" everyone else finds your thinking. so in general people will endorse the opinions of those they endorse as "smart people"
- knightofmars 8y ago
  100% this, "If anything being highly intelligent makes it much easier to rationalize a ridiculous belief system."
jeffdavis 8y ago
The point of lean startups isn't so that your startup finds the global maximum. Investors invest in many startups. Each one starts in a different valley and starts climbing the hill. The investor's job is that one of the startups pays off. Your job is to climb your hill quickly and cheaply.
- foobiekr 8y ago
  This. If you think of startup investments as market probing activity, then the lean startup model is an optimized version of this for specific kinds of markets. You aren't going to make a new storage company or a new ASIC-based company in the lean startup model (though you can certainly be _lean_er_ than companies tended to be in the past or the lavishly spending mega-investment-level companies on the spendthrift side of the capital wall like Uber) but you can do a lot of probing of the consumer marketplace this way.
- Jakkaps 8y ago
  Depends on which way you look at. I wrote the article from the perspective of a founder, not an investor. The math analogy is a bit stretched though. Following it, the only thing that matters is where you start. If you started in the hill leading up to the global maximum you'd be good. I have no statistics to back this up, but I would suspect reaching a global maximum is more expensive than reaching a local one. Truly world-changing ideas, therefore, don't lend themselves as well to the lean methodology.
  - deleted 8y ago
    [deleted]
  - jeffdavis 8y ago
    I guess it's a matter of scale, like a fractal. If your idea is big enough, it might be easy to get fooled into thinking you are at the top when a small detour might lead to a much higher summit.
wcr3 8y ago
fuck off.
TheTruth321 8y ago
Key Takeaways: Zero, Zilch, Nada. Fixed it for you.
OldSchoolJohnny 8y ago
Peter Thiel is a questionable human being. I'm not sure anyone should be taking advice from him.
- astine 8y ago
  Genghis Khan was arguably also a questionable human being but if I found myself at the head of clan of steppe tribemen about to square off against another clan of steppe tribemen, then I might want to know how the great Khan would have handled the situation.
- blunte 8y ago
  Depends on your priorities. It appears there are quite a few people who would happily follow his example in pursuit of rewards like he has received.
- mirceal 8y ago
  hahahahaha. this is a typical mistake of melting the person and the advice/writing/work. it’s a big mistake imho. a lot of people that did do questionable things (not sure that Peter is one of them though) produced great works of art or generated ideas that are at the foundation of the fabric of our society. judge the ideas and the work on their own merits.
- icelancer 8y ago
  Learn to separate personal from business in this world. One can be a great person without being a good one. And vice versa.
  - ilrwbwrkhv 8y ago
    thats why i hang hitlers paintings in my bedroom
- anonytrary 8y ago
  That's a fallacy. Counterexample: "Eat fruits and vegetables if you want to be healthy" - Hitler
owens99 8y ago
The point about Lean Startup is close, but ultimately incorrect. The whole idea behind pivoting is to make a dramatic change when iteration starts to put you into a local maximum. Eric Ries explains it exactly in this way: when each additional iteration leads to less and less improvement, that is when it is time to pivot. Pivoting is not A/B Testing, it is not iterating. It's making a leap in a new direction.
- thomasmeeks 8y ago
  Thanks for this, it resonates with me strongly but somehow I didn't pick it up from the book.
hassan_shaikley 8y ago
I find the fact that this book encourages monopolies troubling at best and dishonest at worst. He seems to be in favor of authoritarianism and domination more than freedom. I find it disingenuous especially for a billionaire who preaches 'Faith' in the free market when one of his teachings is essentially eliminating competition.

124 points by Jakkaps 8y ago

People have too much faith in their opinions. Exempting yourself from a general human behavior is dumb... That second phrase is gold!

x220 8y ago
This sort of thing always comes up when I talk to my friends about marriage. I tell them that I'll never get married because of the divorce statistics, and they tell me that only dumb foolish people get divorced. I tell them "how do I know I'm also not a dumb foolish person or whoever I marry isn't a dumb foolish person?" I haven't found an answer to that yet. Genuinely not trying to start a flame war, just trying to make an interesting point.
- jliptzin 8y ago
  That’s the kind of observation I’ve come to appreciate the older/wiser I get. You start off life feeling invincible, that those kinds of stats won’t apply to you because you’re not a fool like everyone else. But eventually you learn to pay attention to the stats because much more often than not you fall pretty close to the center of the bell curve for most things in life, no matter what.

mrfredward 8y ago

One of my favorite points in the book is the explanation for why any sort of niche small business software sucks. In consumer software, customer acquisition cost is low and development costs can be spread over millions of people, so there is a big profit potential even though the price is low. For large enterprises, the customer acquisition cost is high (lots of meetings with suits), but the payout is high (millions of dollars is good value for software that is going to be deployed at 20,000 locations and serve millions of customers). For a small business, customer acquisition is still expensive (sales and support done personally), but the price is still pretty low. The book cured me of mumbling "I could make software better than that in a week" every time I saw a receptionist at a small office struggling with a bad app.

stcredzero 8y ago
The book cured me of mumbling "I could make software better than that in a week" every time I saw a receptionist at a small office struggling with a bad app. What if the acquisition cost could be made low? Doesn't patio11's appointment reminder app fall into this category? https://www.indiehackers.com/interview/how-i-grew-my-appointment-reminder-business-to-12k-mo-2b8720ca25 https://www.indiehackers.com/interview/how-i-grew-my-appoint...
- rpeden 8y ago
  It might. He talks about revenue but not about profit. So we dpn't really know much about his costs, aside from him mentioning that he was spending a meaningful amount on insurance. It could very well be that acquisition cost was quite reasonable, and he may have talked about this elsewhere. I just don't think the IH interview tells us enough to know for sure one way or the other.
  - simonswords82 8y ago
    He's published a huge amount of detail about revenue and costs, his profits aren't enough to sustain a family. I say that with the greatest amount of respect for the man by the way, he's super super smart and I love his writing.
- TrevorAustin 8y ago
  Probably not, given that he abandoned the app and works at Stripe now.
- coldtea 8y ago
  It can be great even if the "acquisition cost" is high, assuming you charge people for it. It just doesn't lend itself to the "do a business that sells $10 dollar bills for $5 funded by VC money until it has enough eyeballs to start selling ads".
- simonswords82 8y ago
  I learned the hard way that "passive income" via SaaS is fools game. Yes it does exist, but it's incredibly rare and so it's very unlikely that any idea I have is going to be the unicorn idea that generates a shedload of money for minimal effort. I stand about as much chance of becoming the next YouTube/Insta star.

api 8y ago

"From what I’ve observed, really smart people tend to be right, and you can safely accept their viewpoints." What? I couldn't believe this statement. It completely neglects the massive differences that exist between people of any intelligence in terms of what and how they think. I'm talking about things like educational level, ideological biases, epistemological approaches to thinking, etc. It also completely neglects the honesty and integrity of the person you are emulating. To give just one example: I've found that most of the "conspiracy nuts" I've met (people who think we didn't go to the Moon, etc.) are highly intelligent, probably pretty far above average. If anything being highly intelligent makes it much easier to rationalize a ridiculous belief system. Any idiot can imagine a round Earth that spins and orbits the sun but it takes someone with very high intelligence to understand ether vortex theory. Judging by the intricacies of their speculations the "bakers" who assemble bizarre far-fetched conspiracy theories out of QAnon's cold reading act are also quite intelligent. Con artists also tend to be highly intelligent, hence my comment about honesty and integrity. For some odd reason it seems like a whole lot of very bright people have adopted this weird kind of biological determinist hard materialist view of cognition and its quality. By materialist I mean it reminds me of Marxist dialectical materialism: the idea that the state of society is a pure function of its technology and other capital. A bunch of people think you can measure someone's IQ and that will tell you how correct their opinions are. Smart people have better opinions because they can think more faster, or something. I struggle to understand how anyone could possibly believe this. It's patently absurd. It's roughly analogous to saying you can tell the quality of a driver by the performance of the vehicle they are driving, or that the correctness of a computer's output is a pure function of processor speed irrespective of what software it's running.

00N8 8y ago
I agree. At best the argument that you can trust "smart" people is circular: that smartness is a socially constructed measure of how "good/right/clever" everyone else finds your thinking. so in general people will endorse the opinions of those they endorse as "smart people"
knightofmars 8y ago
100% this, "If anything being highly intelligent makes it much easier to rationalize a ridiculous belief system."

jeffdavis 8y ago

The point of lean startups isn't so that your startup finds the global maximum. Investors invest in many startups. Each one starts in a different valley and starts climbing the hill. The investor's job is that one of the startups pays off. Your job is to climb your hill quickly and cheaply.

foobiekr 8y ago
This. If you think of startup investments as market probing activity, then the lean startup model is an optimized version of this for specific kinds of markets. You aren't going to make a new storage company or a new ASIC-based company in the lean startup model (though you can certainly be _lean_er_ than companies tended to be in the past or the lavishly spending mega-investment-level companies on the spendthrift side of the capital wall like Uber) but you can do a lot of probing of the consumer marketplace this way.
Jakkaps 8y ago
Depends on which way you look at. I wrote the article from the perspective of a founder, not an investor. The math analogy is a bit stretched though. Following it, the only thing that matters is where you start. If you started in the hill leading up to the global maximum you'd be good. I have no statistics to back this up, but I would suspect reaching a global maximum is more expensive than reaching a local one. Truly world-changing ideas, therefore, don't lend themselves as well to the lean methodology.
- deleted 8y ago
  [deleted]
- jeffdavis 8y ago
  I guess it's a matter of scale, like a fractal. If your idea is big enough, it might be easy to get fooled into thinking you are at the top when a small detour might lead to a much higher summit.

wcr3 8y ago

fuck off.

TheTruth321 8y ago

Key Takeaways: Zero, Zilch, Nada. Fixed it for you.

OldSchoolJohnny 8y ago

Peter Thiel is a questionable human being. I'm not sure anyone should be taking advice from him.

astine 8y ago
Genghis Khan was arguably also a questionable human being but if I found myself at the head of clan of steppe tribemen about to square off against another clan of steppe tribemen, then I might want to know how the great Khan would have handled the situation.
blunte 8y ago
Depends on your priorities. It appears there are quite a few people who would happily follow his example in pursuit of rewards like he has received.
mirceal 8y ago
hahahahaha. this is a typical mistake of melting the person and the advice/writing/work. it’s a big mistake imho. a lot of people that did do questionable things (not sure that Peter is one of them though) produced great works of art or generated ideas that are at the foundation of the fabric of our society. judge the ideas and the work on their own merits.
icelancer 8y ago
Learn to separate personal from business in this world. One can be a great person without being a good one. And vice versa.
- ilrwbwrkhv 8y ago
  thats why i hang hitlers paintings in my bedroom
anonytrary 8y ago
That's a fallacy. Counterexample: "Eat fruits and vegetables if you want to be healthy" - Hitler

owens99 8y ago

The point about Lean Startup is close, but ultimately incorrect. The whole idea behind pivoting is to make a dramatic change when iteration starts to put you into a local maximum. Eric Ries explains it exactly in this way: when each additional iteration leads to less and less improvement, that is when it is time to pivot. Pivoting is not A/B Testing, it is not iterating. It's making a leap in a new direction.

thomasmeeks 8y ago
Thanks for this, it resonates with me strongly but somehow I didn't pick it up from the book.

hassan_shaikley 8y ago

I find the fact that this book encourages monopolies troubling at best and dishonest at worst. He seems to be in favor of authoritarianism and domination more than freedom. I find it disingenuous especially for a billionaire who preaches 'Faith' in the free market when one of his teachings is essentially eliminating competition.