How Peter Thiel distinguishes insanely cool startups from insane
Recently, San Francisco hosted one of the most prestigious events for startup developers - TechCrunch Disrupt SF. TechCrunch talked during the conference with Peter Thiel, a famous venture investor, co-founder of PayPal and the first external investor to Facebook. He and his partners have launched and funded many successful startups of the last decade: among them LinkedIn, Yelp, SpaceX, Friendster, Quora, and Geni. You can watch a video of the interview with Peter Thiel on YouTube , and we in Alconost translated this conversation into Russian - to the delight of all startups, IT specialists and not only.
- You talked a lot about the need to choose ideas and projects that may seem crazy to an ordinary person. After all, someone already surely realized the ordinary, “normal” ideas. How do you distinguish just a crazy project from a crazy awesome project that has every chance of success?
- Studying an idea or a project, one should try to understand their real value and look into the very essence. For example, assess whether the technology is operational, under what conditions it will work. In addition, it is worth asking the founders about their common history: did they work together before, would they not give up their project at the first difficulties? You should always focus on the essence of the project: there are no easy ways.
')
- Are you trying to avoid bias by evaluating which idea might work in the future, and which one - not?
- Yes, there is always a temptation to get by with simplified criteria, and we [venture investors, - approx. trans. ] like no one else we do it. But I think you should always try to find the highlight, not trying to immediately say "yes" or "no"; really get to the point every time and keep an open mind.
- When you meet an idea that makes you wonder if it really will work - what questions do you ask entrepreneurs making a presentation? For example, questions about their philosophy, their long-term vision, about the likelihood of success?
- I evaluate three key components: team, technology and business strategy. All these components must be equally valuable. Therefore, when I see people putting emphasis, for example, on technology, I would rather want to talk with them about the team and about the business strategy. That is, I turn to topics that entrepreneurs themselves do not want to talk a lot about.
- I want to ask you a little about your philosophy and the philosophy of "nouveau riche", which came from the world of technology. Do you think that the value systems differ from those who earned good money from technology and from those who make money from a business that is far from technology?
- It is always difficult to summarize. But I think these are quite different things: when you earned money on computers or, say, in resource extraction in the Congo or something like that. Of course, I'm a little prejudiced, but I really believe in it.
As for my philosophy - I think that such a concept as charity deserves rethinking. I always like to ask uncomfortable questions; if in business it is: “What great companies are not founded by anybody?”, then in charity such a question would be approximately like this: “What kind of good deeds nobody wants to support?”. And another question that I always love to ask: "Why is this good thing unpopular?". I do not want to allocate funds for good deeds that are popular: it seems to me that they are already well funded. In my opinion, unpopular good deeds deserve to get more.
- One who makes a fortune in five years may feel that the money he earned does not actually belong to him, that he received it by sheer chance. But the one who consistently and purposefully built a career, working every day for 20 years, will have the confidence that everything that he came to as a result really belongs to him. Have you noticed that it seems to people that they really do not have rights to the money earned in IT, and it is better for them to donate this money to someone? What is the philosophy of these people making big donations to charity?
“Well, I think most of them just want to give something back to the community.” Not sure what they think about whether they deserve all of their wealth or only a part of it.
In fact, what is unusual in the IT industry in Silicon Valley is that most inventions bring at least some benefit to their creators. After all, the history of innovation is for the most part stories about people to whom their own inventions bring nothing. For example, the Wright brothers invented the plane, but did not become rich. You can also recall the famous Edison and Tesla opposition: they say Tesla was a great inventor and did everything right, but Edison somehow ousted Tesla ... As you can see, usually most inventions don’t bring anything to their authors.
To make money, you need to do two things. First: create something valuable for the world. Second: to wrap part of the value created in your favor. And just the second people often fail completely. I think Silicon Valley is special in that there is a vast class of innovators who can benefit from the value they have invented.
- That is, now we have businessmen who have grown rich on what the whole world needs and hoping that they can bring benefit to the world?
- Yes, and I always say that it is better to do the world better not because of the need for status or respect. In charity activities you need to be as courageous as in setting up a business.
- Well, be brave and make donations!
About the translator
The article is translated in Alconost.
Alconost is engaged in the localization of applications, games and websites in 60 languages. Language translators, linguistic testing, cloud platform with API, continuous localization, 24/7 project managers, any formats of string resources.
We also make advertising and training videos - for websites selling, image, advertising, training, teasers, expliners, trailers for Google Play and the App Store.
Read more: https://alconost.com
How to evaluate ideas and startups
- You talked a lot about the need to choose ideas and projects that may seem crazy to an ordinary person. After all, someone already surely realized the ordinary, “normal” ideas. How do you distinguish just a crazy project from a crazy awesome project that has every chance of success?
- Studying an idea or a project, one should try to understand their real value and look into the very essence. For example, assess whether the technology is operational, under what conditions it will work. In addition, it is worth asking the founders about their common history: did they work together before, would they not give up their project at the first difficulties? You should always focus on the essence of the project: there are no easy ways.
')
- Are you trying to avoid bias by evaluating which idea might work in the future, and which one - not?
- Yes, there is always a temptation to get by with simplified criteria, and we [venture investors, - approx. trans. ] like no one else we do it. But I think you should always try to find the highlight, not trying to immediately say "yes" or "no"; really get to the point every time and keep an open mind.
- When you meet an idea that makes you wonder if it really will work - what questions do you ask entrepreneurs making a presentation? For example, questions about their philosophy, their long-term vision, about the likelihood of success?
- I evaluate three key components: team, technology and business strategy. All these components must be equally valuable. Therefore, when I see people putting emphasis, for example, on technology, I would rather want to talk with them about the team and about the business strategy. That is, I turn to topics that entrepreneurs themselves do not want to talk a lot about.
Philanthropy: helping those who do not help much
- I want to ask you a little about your philosophy and the philosophy of "nouveau riche", which came from the world of technology. Do you think that the value systems differ from those who earned good money from technology and from those who make money from a business that is far from technology?
- It is always difficult to summarize. But I think these are quite different things: when you earned money on computers or, say, in resource extraction in the Congo or something like that. Of course, I'm a little prejudiced, but I really believe in it.
As for my philosophy - I think that such a concept as charity deserves rethinking. I always like to ask uncomfortable questions; if in business it is: “What great companies are not founded by anybody?”, then in charity such a question would be approximately like this: “What kind of good deeds nobody wants to support?”. And another question that I always love to ask: "Why is this good thing unpopular?". I do not want to allocate funds for good deeds that are popular: it seems to me that they are already well funded. In my opinion, unpopular good deeds deserve to get more.
Big Jackpot and Universal Injustice
- One who makes a fortune in five years may feel that the money he earned does not actually belong to him, that he received it by sheer chance. But the one who consistently and purposefully built a career, working every day for 20 years, will have the confidence that everything that he came to as a result really belongs to him. Have you noticed that it seems to people that they really do not have rights to the money earned in IT, and it is better for them to donate this money to someone? What is the philosophy of these people making big donations to charity?
“Well, I think most of them just want to give something back to the community.” Not sure what they think about whether they deserve all of their wealth or only a part of it.
In fact, what is unusual in the IT industry in Silicon Valley is that most inventions bring at least some benefit to their creators. After all, the history of innovation is for the most part stories about people to whom their own inventions bring nothing. For example, the Wright brothers invented the plane, but did not become rich. You can also recall the famous Edison and Tesla opposition: they say Tesla was a great inventor and did everything right, but Edison somehow ousted Tesla ... As you can see, usually most inventions don’t bring anything to their authors.
To make money, you need to do two things. First: create something valuable for the world. Second: to wrap part of the value created in your favor. And just the second people often fail completely. I think Silicon Valley is special in that there is a vast class of innovators who can benefit from the value they have invented.
- That is, now we have businessmen who have grown rich on what the whole world needs and hoping that they can bring benefit to the world?
- Yes, and I always say that it is better to do the world better not because of the need for status or respect. In charity activities you need to be as courageous as in setting up a business.
- Well, be brave and make donations!
About the translator
The article is translated in Alconost.
Alconost is engaged in the localization of applications, games and websites in 60 languages. Language translators, linguistic testing, cloud platform with API, continuous localization, 24/7 project managers, any formats of string resources.
We also make advertising and training videos - for websites selling, image, advertising, training, teasers, expliners, trailers for Google Play and the App Store.
Read more: https://alconost.com
Source: https://habr.com/ru/post/237975/
All Articles