The following is a summary of Zero to One: Notes on Startups or How to Build the Future. I do not claim to own any of the book's original work, the following is simply a bulleted summarization with a few direct quotes. All copyrights and trademarks belong to their respective owners. Chapter 3 - All Happy Companies are Different:

• Creating value is not good enough
  • You also have to capture some of the value too
• Perfect competition is considered ideal by basic economics
  • Markets achieve equilibrium when producer supply meets market demand
  • All competitors ell nearly the same things
  • Market sets the price of all competitors items

 

• In the long run, “no company makes an economic profit”

 

• Opposite of of perfect competition: monopoly
  • A monopoly completely owns its market
    • So, it can set its own prices
  • Produces the quantity and price combination to maximize profits
  • Thiel specifies by monopoly, he means “the kind of company that’s so good at what it does that no other firm can offer a close substitute
• “If you want to create and capture long lasting value, don’t build an undifferentiated commodity business”
• Companies tell lies:
  • Companies that are monopolies try to conceal the fact
  • Companies that have competition try to say they are in a league of their own
• Ruthlessness:
  • Companies not earning monopoly money have to be ruthless to survive
    • They can only focus on money
    • They can only pay minimum wage, etc.
    • Only focuses on day-to-day operations
  • Monopoly companies can focus on other things since they have cash to spare
    • Can focus on long term plans
    • Ability to take ethics and morality seriously
      • This is very important to me

 

• “money is either an important thing or it is everything”

 

• Monopoly Capitalism:
  • Creative monopolies give customers more choices
  • Powerful engines to make society better
  • Government awards monopolies (patents) but also hunts them down (antitrust)
  • “Monopolies drive progress because of the promise of years of profits means incentive to innovate”

  If you've liked this summary, I highly recommend you get the full book here: Zero to One: Notes on Startups, or How to Build the Future < Previous Chapter | Overview | Next Chapter > - Alec Kriebel