Billionaire VC Peter Thiel Says Silicon Valley's 'Obsession' With Disruption Is Totally Misguided
<img src="http://static4.businessinsider.com/image/5419fb3f69bedd176a724d94-1200-600/peter-thiel-31.jpg" border="0" alt="Peter Thiel">
It's hard to find a hotter business buzzword than disruption.
<span style="background-color: #ffffff;">The theory, made popular by Harvard Business School professor Clayton Christensen, refers to a strategy that scrappy, young companies use to topple giant firms<span style="line-height: 1.5em;">, like Netflix did to Blockbuster or Microsoft did to IBM back in the day.</span><span style="line-height: 1.5em;"> It's now bandied about so often by aspiring entrepreneurs that it's become a cliche used to describe almost any effort to alter or improve a business.</span></span>
<span style="font-size: 15px; line-height: 1.5em; background-color: #ffffff;">And it's not a very helpful one, says PayPal founder-turned-mega-VC Peter Thiel. In his new book <span style="background-color: #ffffff;">"Zero to One,"</span> he explains why fixating on disruption dupes entrepreneurs: </span>
<p style="padding-left: 30px;">The concept [of disruption] was coined to describe threats to incumbent companies, so startups' obsession with disruption means they see themselves through older firms' eyes...
<p style="padding-left: 30px;">But if you truly want to make something new, the act of creation is far more important than the old industries that might not like what you create.
<p style="padding-left: 30px;">Indeed, if your company can be summed up by its opposition to already existing firms, it can't be completely new and it's probably not going to become a monopoly.
<img style="float:right;" src="http://static2.businessinsider.com/image/541702d669bedde00b1a57ac-800-1200/zerotoone.finalcover-resized.jpg" border="0" alt="zero to one cover peter thiel book" width="400">Why is this important? Because for Thiel, the only way a startup can be sustainably successful is if it totally owns a category, like Google did with search (and continues to do so, with a full 67% of the global search market).
"Monopolists can afford to think about things other than making money," he says. "Non-monopolists can't."
Since Google dominates search — with<span> competitors Microsoft and Yahoo lagging at 18% and 11% marketshare in the space — it can afford to actually take care of its people, Thiel says.</span>
To Thiel's point, Larry Page and Sergey Brin didn't set out to "disrupt" the Yellow Pages; they just made the best search engine the world's ever seen, arguably establishing a monopoly in search.
<span>"Monopoly is the condition of every successful business," Thiel writes. N</span><span style="font-size: 15px; line-height: 1.5em;">ot disruption.</span>
<b>See Also:</b>
<ul><li>Emerging Payment Technologies Will Create New Winners And Losers In The Giant Credit Card Industry</li><li>These Hidden iOS 8 Tricks Will Make Your iPhone Feel New Again</li><li>French Police Find 9 Pounds Of Cocaine In A Vatican Car</li><li>Peter Thiel: Google Has Insane Perks Because It's A Monopoly</li><li>Why Peter Thiel Doesn't Hire MBAs, Hates Suits, And Thinks Silicon Valley Can Be Awful For You</li></ul>
SEE ALSO: Why Peter Thiel Doesn't Hire MBAs, Hates Suits, And Thinks Silicon Valley Can Be Awful For You
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