Peter Thiel Interview – Peter Thiel’s Top 10 Rules For Success (@peterthiel)

– He’s an American entrepreneur,
venture capitalist, and hedge fund manager. – He co-founded PayPal, with
Max Levchin and Elon Musk. – He’s ranked fourth on the
Forbs Midas list of 2014, at 2.2 billion dollars. – He’s Peter Thiel and here are his top ten rules for success. (swooshing) – You are the entrepreneur of your life. And you can, you can decide you know, what you’re going to do, what
you’re going to prioritize, and you should never forget that you have a tremendous amount of freedom as it is to make these very basic decisions on what you’re going to do with your life. You can start anytime you want. The most critical thing for every start up is to be doing one thing uniquely well, better than anyone else in the world. Technology’s a fundamentally
global business and the really great technology companies, are doing something significantly better than anybody else in the
world and you want to be in that sort of position. I think if you’re just
starting a business, one of the questions that’s
always valuable to answer is what do you know
that’s true that nobody else understands or more prosaically, what great business exists
that nobody is building? One part that I’m always very focused on is sort of, the structure
of these companies and how well are people aligned? So you can and making sure
that people are you know aligned properly, not just
that they say they are. I think this is sort of a
very, a very legal kind of a framework to think about; what are peoples’ incentives, you know, are they going to be aligned or not and I think you want to
both have formal alignment, where you set the structure right, and you want to have informal alignment, where the people would naturally
try to work together well in one way or another. And I think that somehow
tends to get obscured in all these other ways. You know there’s always, there’s
always a, there’s always a pre-history question I like
to ask founders of companies which is how did you,
how did you um, meet, what’s the pre-history of the
company before you got started and I find that to be a really
instructive set of questions to ask; a bad answer is
something like, you know, we met a week ago at a
social networking function at a business networking function. We decided to start a
company because we both wanted to be entrepreneurs. You know that’s like saying, I married the first person
I met at the slot machines in Las Vegas and you
might hit the jackpot, but it’s probably a really bad idea. A much better answer is you
know, we’ve been talking about his for a long time. You know, maybe one of us
is more on the tech side, the other ones more on the business side. We have these sort of complimentary skills and so I think this question
of alignment and structure is incredibly important. I think that all, if you’re
a founder or entrepreneur, what you want to aim for is monopoly. You want to aim to build a
company that is one of a kind. That’s so far differentiated
from the competition that it’s not even competing. And I this conventionalism
is always with capitals and competition are somehow synonyms; I believe they’re antonyms. A capitalist is someone
whose in the business of accumulating capital; a
world of perfect competition is a world where all the
profits are competed away. If you want to compete like
crazy then you should just open a restaurant in Chicago. And um, and I think the
great companies like Google, so the paradigm example I use, has had no serious competition
in Search since 2002 when it definitively distance itself from Yahoo and Microsoft
and as a result it’s been generating enormous cash
flows for the last 12 years. But yeah, there probably are
a lot of people who end up trying to be somewhat fake entrepreneurs where the goal is to be an entrepreneur. If you ask people what do you
want to do with your life? What do you want to do when you grow up? I want to be an entrepreneur, which I always think is
a somewhat too common, disturbingly somewhat too common and I think you know it’s
a, it’s saying that you want to be entrepreneur
sort of like saying I want to be rich or I want to be famous. You know, nobody in their
right mind starts a company for the sake of starting a company. You start a company because
there’s a very important problem to solve that’s not getting solved in large you know,
governmental or nonprofit or for profit institutions and that’s why you actually need to start a new company. Just starting a company
for the sake of doing so is a really odd thing to do. On an individual level
I think it is always, it’s always really good
if there’s something that you’re incredibly passionate about and just sort of are find to
be intrinsically interesting and the people pursue that and so the, you know one of the
resolutions I came up with a number of years ago was to always value substance over status;
substance over prestige. And you know if I sort of was
giving my younger self advice on what to, what to do or how
to think about ones’ life, I probably, I think I you
know, I probably would still go to Stanford, I might
still go to law school. But I’d ask sort of, I’d
ask a lot more questions why I was doing these things and I think I think if I was honest about it, too much of it was driven
by, by prestige and status and not quite enough about
really the substance of trying to learn things. I have sort of this, I sort
of just think of it as this sort of crazy rolling quarter life crisis and sort of culminated in
this big New York law firm where you know, from the outside
everybody wanted to get in. From the inside everybody
wanted to get out. You know, after, I lasted
seven months and three days and after, when I left one of
the people down the hall said, it’s so reassuring to see you leave Peter. I had no idea it was possible
to escape from Alcatraz. Which again, and again I,
and all you had to do was go through the front door, but our identity, people’s identities get so wrapped up in the things they compete for
that it was inconceivable for people to actually do that and then the question was you know, well how had I ended up there? Why had I not thought about that more? And I think it was that I
had taken too many of these shortcuts of valuing sort
of what was prestigious, what was conventional over
what I really wanted to do. So I think always substance over status. And this is why I think
competitions always this very two edged thing; when
you compete ferociously, you will get better at that
which you are competing on, but you will always narrow your focus to beating the people around you and it often comes at
this very hight price of losing sight of what is more important or perhaps more valuable. The general theme I would
suggest is that all trends are overrated and so if you
think about current trends in technology, you know, health care, I.T. software,
education software, overrated. SAS enterprise software really overrated. Big data, cloud computing,
if you hear those words you need to think fraud;
you need to run away as fast as you possibly can. And the reason these buzzwords tell you that something, these buzzwords
are sort of like a tell in poker that people are bluffing and that there’s nothing,
that the business is not undifferentiated
because the buzzwords tell you that it is one company of a
category that’s undifferentiated from the others in that
category and therefore, are symptomatic somehow
of a lot of competition and a bad business idea. And so you know, you don’t
want to be the fourth online pet food company, you
don’t want to be the tenth tin foam solar panel
company, you don’t want to be the one-thousandth
restaurant in San Francisco and so there’s something
about if you can describe what a company is doing
very straight forwardly by referencing these
buzzwords, these categories that already exist. That’s actually a sign
that it’s a pretty bad, that it’s a pretty bad idea. I think there’s a problem
in western Europe where, where failure is, it’s
too impossible to fail. Once you fail you can never,
you can never start over. I think there’s an opposite
version of this in California where I think sometimes
people are a little bit too facile about failure because
I think it actually is always incredibly damaging to
people and if you work really hard at something
and it doesn’t work that’s, you know, that’s
going to be psychologically damaging, you know, people
have less confidence. All sorts of reasons why that tends to be, that tends quite bad. I think that when people, I
don’t think there’s that much you learn from failure by the way because it’s typically overdetermined;
it’s like why is technology slowing down, why did you fail? It’s typically five separate reasons: you work with the wrong
people, the idea was bad, the timing was wrong,
it wasn’t a monopoly, the product didn’t work, and okay, next time I’m working
with different people. You figure out one of the five things, you’re likely to fail again. So I think, I think
failure is not something we can learn very much from. I think that’s sort of a
myth that I would challenge. But what I think you should do when something goes badly wrong is you just keep going; you do something else and you don’t dwell on the past. Already in the time of
Shakespeare the word ape meant both primate and to imitate and there is something
very deep in human nature that is imitated; it’s how,
it has a lot of good things, it’s how language gets learned by kids. It’s how culture gets
transmitted in our society. But it also can lead to sort
of a lot of insane behavior. It can lead to the madness
of crowds, to bubbles, to sort of mass delusions
of one sort or another and I think it can, I
think it’s advertising. We always think of, we
always tell ourselves that we’re not that prone to this and I think that’s something
I would encourage all of us to rethink; you know, we always think of advertising as something that
just afflicts other people, that never afflicts ourselves. I think this is very far
from the case and so, and so, the monopoly
competition is not just this intellectual failure,
it’s also this thing where you have a tiny door where
everyone’s trying to rush through and there may be around the corner a vast and a secret gate that no ones taking and you should always find the secret path and go ahead and take that. – Thank you guys so much for watching. – Now we made this video
because Chain Wan Chung on YouTube asked Evan to make it. If you have a famous entrepreneur that you really really really
want Evan to make a video on leave it in the comments below. – I’d also love to know which
of Peter Thiel’s top ten rules hit you the most; leave
it in the comments. We’re going to join in the discussion. Thank you so much for watching. Continue to believe
and we’ll see you soon. (swooshing)

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26 thoughts on “Peter Thiel Interview – Peter Thiel’s Top 10 Rules For Success (@peterthiel)

  1. I strongly disagree with his view on monopolies and competition, but otherwise great advices and video ! His point about failure (starting at 8:44) is pretty interesting and out-of-the-box.

  2. minute 4:11 ……thats exactly what i said about a bunch of people i know at university thats being somewhat doctrinated by these accelerator programs to be entrepreneurs for the sake of entrepreneurs..almost grouped with them but i couldnt work to be motivated as a entrepreneurs, it only make sense to me to give up everything for an idea you really believe in

  3. Ugg, whenever I listen to a Peter Thiel videos, I think about how if I would have looked up who the Theil Fellowship recipients were and found out about Vitalic Buterin, I likely would have bought Etherium at <$2.

  4. I'm reading his book and its pure gold , very interesting and unique perspective of how to be an entrepreneur

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