Competition is an Ideology

I think that by far Zero to One by Peter Thiel was one of the most impactful books I read in 2017. It definitely left a lasting impression on me.From the very beginning of the book , the book introduced questions that challenge the status quo and the general assumptions of business. One that stuck a cord with me was challenging the general assumptions about competition.

One of the tenants of capitalism is competition is great for business. Businesses operate to destroy any competitors in their industry. This is what  drives businesses to be more innovative and come up with the best possible products. So how could competition ever be a bad thing?I don’t believe that there is an absolute answer for whether competition is bad or good, because when it comes to business you can always profit from someones misfortune.

I am going to use the example that is given in the book. Peter Thiel makes the point that competition makes businesses weaker. He uses the example of  Microsoft and Google’s fighting with each other allowed Apple to become the leading computer company and today the richest company in the world. The point Peter is trying to make is that Microsoft “missed” their opportunity because they were too busy competing with Google. However, what he fails to mention is how competition between two big companies was an advantage to Apple.

Peter Thiel strongly believes that competition is for losers and would be to the advantage of a company to be less competitive. This may sound strange initially, but the point that is being made is not relating simply to competition, but more about being reactionary. If you want your business to fail build one that only reacts to your competition. If the whole basis of your business is simply to out do the competition you will be successful in the short term but not in  the long term.

Competition also provides opportunity. Perhaps you shouldn’t join the fight with every major company in your industry , but rather when everyone is fighting, you should take the opportunity to dominant that sector.

“More than anything else, competition is an ideology, the ideology that pervades our society and distorts our thinking. We preach competition, internalize its necessity, and enact its commandments, and as a result, we trap ourselves within it. Even though the more we compete, the less we gain.” – extract from Zero to One


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