- We want competition because it allows nefarious monopolies (and other companies) to be overtaken by better companies.
- We don't want to discourage companies from attempting to obtain monopolies in their markets, since this gives them to opportunity to capture monopoly profits. Monopoly profits are not inherently bad. If a company becomes a monopoly, we want them to be a creative monopoly.
- A competitive market in the sense of having low profit margins is very different from a competitive market in the sense of whether or not new entrants can come in and compete.
- It is a bad thing if a company has monopoly power through something other than being a superior company, is capable of preventing new entrants, and is uncreative. We want to preserve the ability of new entrants to come into the market with superior products and overtake monopolies.
(edit: formatting)
[1] To use Thiel's terminology, it matters how quickly the market moves back into equillibrium, and that is dictated by the same forces that give rise to static monopolies.
Distinguishing between "good" and "bad" monopolies is sufficiently complex to deserve more in-depth exploration. Thiel is smart enough to realize that which is why I consider his point to be misquoted. Unfortunately, his view is oversimplified so as to be readily consumed and debated.
He lists characteristics of a monopoly in his book: proprietary tech, network effects, economies of scale, and branding. First mover advantage is mentioned as a "tactic, not a goal" - a chapter is even called "Last Mover Advantage." Google, for one, was clearly not a first mover in the search space.
I'm pretty sure we all agree that standard oil and internet explorer were not of great benefit to society.
"Something that’s true that very few people agree with you on." I read this and my mind immediately tried to come up with such truths so.. interesting.
"The goal of every successful business is to have a monopoly." What's interesting about this idea?
Monopolies are profitable. Companies like that. They're big, they like that too.
A 'Differentiation' strategy is a way of creating monopoly-like microeconomics for your business. Differentiation is usually the dominant strategy in technologically new industries while its opposite (penetration strategy: high volume, low cost) is usually the dominant strategy in mature industries like supermarkets, auto components and canned beans. That's interesting.
Full-blown monopolies often arise at the centre of disruptive new industries. Rails, energy, computing. Patents were originally created give monopolies as a reward for innovation. That's interesting.
So far, this monopolies thing seems to be an interesting idea.
Other than that, he does interesting things and says interesting things about them: Philanthropy, Seasteading, dropping out of college, anti-aging, book writing...
That's a common misconception. The original reasoning for patents was to provide a limited (in time) monopoly to inventors in exchange for sharing (and describing in detail) their invention with the whole of society.
Interesting anecdote, afaik Gore & Associates, Inc.'s Goretex patent expired before it was universally used for outdoor clothing, thus any brand coukd release their own unlicensed goretex-like material. They have since stopped patenting many of their inventions afaik.
Some of the apparent ancient predecessors of patents may have been on this basis, and clearly that's the theory of the modern patent system in some parts of the world. But the origin of letters patent was really the whim of the monarch, and they may have been granted for sharing information, or just for sharing the proceeds of the monopoly with the crown.
Because from your business' perspective, you want a monopoly to have the greatest potential success. This doesn't preclude competition; your competitors are also trying to build a monopoly.
What is the "game"? Are we trying to build great products to "change the world" (aka another anon msging app or "Uber for X") as so many proclaim or are we just here to get rich quick - adopting the previous generation's mantras to fit in and get funding.
Why are you here? Why did people come in the early ninetees? We should live our rhetoric and stop mostly aiming for money. Sometimes they go hand in hand but what is our primary motivation these days?
Sorry this is not aimed at your response in particular, I just think we as a whole have lost our way and our former identity with startups becoming the new Wall Street.
EDIT: made less ranty
And maybe I used the wrong word - rules suggest something positive - maybe I should say 'mechanics' or something.
Take Machiavelli - did he make politics worse by describing how it works?
I don't see that as a problem, but I also don't see it as a sustainable process. Maybe that doesn't matter since VC fund performance is such a hall of mirrors that having the magic investment criterion is better than having the best numbers.
There is certainly nothing wrong with prompting entrepreneurs to aim for that kind of a business.
And personally, Peter is just very likable. I'm always happy to listen to him talk even when I know what he's gonna say.
His views on technology are a breath of fresh air. He is one of the only SV figures who seems to care about building technologies with the next century in mind rather than the next three years.