Proprietary technology is the most substantial advantage for a business: it makes your offering hard to replicate. You need an order of magnitude (10x) improvement to have a real monopolistic advantage:
- Incremental improvements offer no real improvement to the user and are hard to sell in a crowded market.
- Lab results don’t compensate for expenses and risks of a new product in the real world.
- People are used to exaggerated statements and 20% improvement is not enticing enough to overcome skepticism.
How to get a 10 improvement?
- Easiest way to create a >10x improvement is to create something completely new.
- Radically improve an existing solution (Amazon offered >10x books than every other bookstore)
- Superior integrated design (Windows and Nokia tablets vs Apple iPad)
Zero to One, Peter Thiel.
Links to this note
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