Sometimes two or more great business-related books appear to offer contradictory advice, and it's not always clear whether you should follow the advice from one book or from another, as evidenced by a comment I saw on the previous article between "The Lean Startup" and "Zero to One."
The commenter pointed out that "Zero to One" criticizes some of the ideas in "The Lean Startup" in many ways. As a result, it's not entirely clear which approach you should take when launching your own startup company.
So, rather than simply responding to the comment, I thought it would be interesting to dive into this in a separate article where we could go into more detail. So, let us quickly set the scene.
"The Lean Startup" by Eric Ries'
Eric Ries' "The Lean Startup" is a methodical approach to turning a startup idea into a sustainable business. So it's really focused on identifying the assumptions within your startup or business idea, clarifying those assumptions, translating them into hypotheses, and then validating those hypotheses before investing further into the business.
So, rather than just taking a big swing, it's about understanding your guesses and assumptions and finding ways to validate those things as cheaply and quickly as possible so you can have more confidence in your idea and don't overinvest in something that might not turn out to be a winner.
"Zero to One" takes a slightly different approach. The central theme of this book is to have a bold vision, to strive for big things, to step outside of your comfort zone, and to take risks rather than focusing on iterative approaches. In the book, Peter Thiel says, "It's better to risk boldness than triviality."
So, in many ways, he's advocating for the type of business where you have a bold vision from the founder or founding team, and in many ways, that's kind of the concept behind the title "Zero to One," because it's about finding ways to go from zero to one, to bring entirely new things into the world that didn't exist previously, rather than making iterative improvements on an existing idea going from one to two or two to three or three to four.
Now, in my personal opinion, I don't believe there is such a stark contrast between these two approaches. I think in one way, they're speaking to different audiences and different problems, and they're also addressing extremes that can sometimes occur in business.
So "The Lean Startup," what I love about the message here is that almost no matter what you're pursuing, there's almost certainly a way to get clear on the assumptions that are underlying your business idea, and it's almost always the best approach to test and validate those ideas before making a massive commitment. That's almost always the case.
In some cases, it's very difficult to test things ahead of time, but in most cases there's no really good reason why you should just take a massive risk for the sake of taking a massive risk.
Zero to One by Peter Thiel
What I love about this book is it's really calling on people to avoid getting stuck in an overly iterative approach.
I'm going to give you a few examples so you can see how this works because when we look at some of the most successful companies, particularly in the tech space, companies like Uber, Google, and Amazon, we often have this perception that they are visionary led, that the founders knew exactly what they were building from the start and simply set out to execute on this bold and ambitious vision.
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When you get down to the nitty gritty, that doesn't actually hold true, but there is a blending of these two approaches, and that's really what I want to emphasize here. It's like taking the best of both worlds and figuring out how to combine them into a more effective strategy.
So, for example, let me quickly go over a few. Uber, Uber did have a bold vision, but it was very different from the Uber we see today. Uber began as a simple attempt to build a premium black car service where you could hail a black car from your smartphone.
I believe, it was in San Francisco at the time. You could call what was essentially a limousine service using your smartphone, and it wasn't until much later.
In response to Lyft and their efforts to do more of the crowdsourced driver relationship thing, that Uber changed their mission.
They altered their strategy and developed a much bolder and more innovative approach, pursuing the business model that we see them pursuing today.
However, they used lean startup methodologies throughout the process, testing ideas, iterating, and trying new things, but it was all tied to a bold vision, and it was the combination of the two elements that really made it work.
Google is another quick example here. Google was a research project in its early days, not this incredible search engine project. In the beginning, they planned to sell the technology to existing search engines.
That was their business model from the start, but they still had a bold vision for a better way to organize the world's information, or at least to organize and make information more searchable in the early days, and so they had a bold vision, but that vision iterated over time and they found ways to validate their idea.
When they reached a plateau, they would look for ways to scale up their vision, and it wasn't until much later that AdWords appeared, as well as their recent ambitions in AI, automation, and pursuing other interesting avenues.
So there are a lot of examples, and I'm not going to get into the specifics, but there are a lot of examples of how these companies used a blended approach.
I'll give you one more quick example because it's probably the most relevant here given Peter Thiel's early investment in Facebook, and in many ways, I believe he would argue that Facebook is an example of a business that went from zero to one, that introduced something entirely new to people, and that he famously invested something like $500,000 into.
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I believe he was the first significant outside investor in the company, and, of course, he turned that $500,000 investment into over a billion dollars, making it one of the best examples of perfect tech investments.
In my opinion, Facebook is another example of a company that took a very blended approach; they had a bold vision, but you could easily argue that the idea behind Facebook was iterative. There were already social media networks in place.
They saw the vision of connecting real identities rather than the more anonymous approach that MySpace and others were using at the time.
So there was some innovation there, they did bring an entirely new approach to social works, but it was also iterative, and while they had a bold vision for the future, that vision evolved and changed dramatically over time, and that story is out there.
You can read about it in books and see it in the popular Facebook film. Early on, the vision was very different from what the company is today.
So, once again, I want to emphasize that in many cases, both of these perspectives work together to create a more complete picture. So it's not always so simple, and often, the viewpoints suggested in one book are the most important for the type of person who is naturally inclined to read the other books.
For example, in some cases, the founder with a bold vision and all kinds of amazing and incredible plans that they just want to dive into, a book like "How to Be a Great Founder?" can be the most practical book for them to read because it can fill in their gaps.
They can see that they don't have to take reckless risks. There are methods for identifying and validating assumptions in their strategy before simply over-investing in an idea.
On the other hand, if you naturally have a very iterative approach, you see other products and services in the marketplace and think, I can make a slightly better version of that, and customers would probably love it.
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In all likelihood, a book like "Zero to One" could inspire you to have a bigger and more ambitious and bold vision for the future, where you think not just in terms of slight iteration or slight improvement over existing products and services, but you try to come up with a more ambitious vision.
So those are my thoughts on the differences between Eric Ries' "The Lean Startup" and Peter Thiel's "Zero to One." Please let me know what you think in the comments section. Is this correct?
Do you still see a contradiction here? What are your opinions? What are your thoughts on these two fantastic books? And if you have another set of books you think would be interesting to compare, please let me know in the comments section, and we may do another episode where we discuss those books.
If you have any additional questions or comments about anything we discussed here, please leave them in the comments section.
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