5 Key Rules about Starting a Business from the Founder of PayPal

Authored by Claire Standring 
JD Candidate 2024 | UCalgary Law 


The serial entrepreneur, co-founder and billionaire investor Peter Thiel wrote a book in 2014 called "Zero to One". This book has earned the nickname of the Silicon Valley start-up bible, and whether it lives up to its name is… well up for you to decide after reading it.
 
Regardless, this book provides valuable insights on entrepreneurship and business, based on his experience as a successful investor and entrepreneur. One of the main themes of the book is the importance of creating something new and valuable, rather than competing in an existing market. According to Thiel, there are seven key rules for starting a successful business:
 
The first rule is to create a unique and valuable product or service. Thiel believes that true innovation comes from creating something entirely new, rather than trying to improve upon what already exists. To achieve this, entrepreneurs need to have a clear understanding of their customers' needs and preferences, and be willing to take risks in developing new products or services.
 
The second rule is to focus on a specific niche market and dominate it before expanding to other markets. Thiel argues that trying to please everyone will result in mediocrity, and that it's better to start small and build a loyal customer base before expanding. By focusing on a specific niche, entrepreneurs can better understand their customers' needs and provide tailored solutions that meet those needs.
 
The third rule is to build a strong team of like-minded individuals who share your vision and values. Thiel emphasizes the importance of hiring people who are not only talented but also aligned with the company's mission and culture. This is crucial for building a cohesive and effective team that can work together to achieve the company's goals.
 
The fourth rule is to take calculated risks and be willing to pursue unconventional paths to success. Thiel argues that successful entrepreneurs need to be comfortable with uncertainty and be willing to take risks that others are not willing to take. This requires a willingness to challenge conventional wisdom and think creatively about how to solve problems and achieve goals.
 
The fifth rule is to embrace the role of technology in shaping the future of business, and invest in research and development to stay ahead of the curve. Thiel believes that technology is the key driver of progress and innovation, and that entrepreneurs need to be aware of emerging technologies and trends in order to stay competitive. This requires a willingness to invest in R&D and explore new ideas and technologies.
 
In addition to these rules, "Zero to One" also emphasizes the importance of building a strong company culture that aligns with your values, as well as the need to constantly adapt and evolve in response to changing market conditions. By following these principles, Thiel argues that entrepreneurs can build successful businesses that have a lasting impact on the world.


Citation: Peter Thiel & Blake Masters, Zero to one: notes on startups, or how to build the future, (New York: Crown Business, 2014).