Most Important Concepts

• Competitive markets erode profits. The goal should be to create a monopoly by solving unique problems.
• A great product alone is not enough; effective sales and marketing strategies are crucial to capturing value.

Action Points

Chapter Recap

Preface

1 - The challenge of the future

• A new company’s most important strength is new thinking.

2 - Party like it’s 1999

• Big lessons from the dot-com crash:
  • Make incremental advances.
  • Stay lean and flexible.
  • Improve on the competition.
  • Focus on product, not sales.
• However, the opposite is probably even more true:
  • It is better to risk being bold than to be trivial.
  • A bad plan is better than no plan.
  • Competitive markets destroy products.
  • Sales matter just as much as product.
• How much of what you know about business is shaped by mistaken reactions to past mistakes?

3 - All happy companies are different

• Your company could create a lot of value without becoming very valuable itself. Creating value is not enough, you also need to capture it.
• Under perfect competition, all profits get competed away. So if you want to capture lasting value, don’t build an undifferentiated commodity business.
• All happy companies are different: each one earns a monopoly by solving a unique problem. All failed companies are the same: they failed to escape competition.

4 - The ideology of competition

• Competition is a destructive force, especially so in business.

5 - Last mover advantage

• Characteristics of a monopoly:
  • Proprietary technology makes your product difficult or impossible to replicate.
  • Network effects
  • Economies of scale
  • Branding