The Wisdom Wall

“So startups never win by being better. Better isn't enough. Better doesn't matter. Only by being radically different can a startup make a radical difference.”

“If you're harnessing a regulatory inflection, I hope you were involved in helping that law get written, because very few laws get passed just out of the goodness of people's heart. Usually there's a set of people who are lobbying for those laws. Usually they have a reason that they want to exploit those laws. Ok, if…”

“either it embodies an inflection. You just haven't thought about it enough, or it doesn't embody an inflection, which probably means you're solving present pain for present customers for present unmet needs. And you might build a reasonable business doing that, but you're not going to build a great business doing that.…”

“They believed in an aesthetically different superior future, and that's why early customers move. They move for aesthetic reasons rather than practical reasons. The same reason that people buy art. They buy into the aesthetic vision of the artist.”

“It's like Buffett and Munger talk about your margin of safety when you buy a stock. It was the intrinsic value of the stock higher than the price of the stock. My business is the opposite. My business is margin of asymmetric upside if it works.”

“So I would say that AI is characterized by tons of massive inflections and not enough insights.”

“So if the answer to your product idea as a startup is, how does that compare to X? You're doing something wrong. You're either not different enough, or you're not leaning into the difference enough. You're being not courageous enough in communicating the difference and languaging the difference.”

“If you have an insight, you have a first mover advantage into the future. And even if your initial implementation is wrong, it's a reference implementation of your insight. You can pivot the implementation by changing the implementation itself or by focusing on a different customer for that implementation. But the art…”

“every startup idea has been tried, because there's an efficient market for ideas, but all of the good ideas will happen. So the only question is, why is now the time for it to happen?”

“What I found was that people who find these secrets, they almost feel guilty about it. They weren't being contrarian in the traditional sense. Contrarian means you're against something. They were just looking in an area they were interested in, an area where most people weren't looking, and they were just paying more…”

“the best startup ideas come from living in the future and building what's missing in the future”

“people tend to misremember how it really happened. Even the founders, they tend to remember knowing things they didn't really know at the time.”

“Here's the other thing I've learned is that startups, even the founders, have an incentive to tell the story differently after the fact, because in the early days, they're trying to appeal to the misfits and the early believers who believe as they do. In the later days, they're trying to appeal to the mainstream, and…”

“The inflection is the thing that allows the startup founder to wage asymmetric warfare on the present. The inflection provides the force multiplier that allows the startup to show up out of left field and not compete by being better, but by changing the subject.”

“A great startup founder needs to say, it's by definition bad for me to compete that way. What I need to do is assume that the future must be radically different and work backwards from those radically different futures. I back cast rather than forecast. And the way that I backcast is I use inflections to bend the arc…”

“People tend to operate according to the current patterns of how they're used to doing things, and that the way that an entrepreneur wins is they impose a new pattern in place of the old pattern, rather than being a pattern match or their pattern break.”

“And in startups, you can't be non-consensus and right without taking the risk of being non-consensus and wrong, but there's no free lunch in that regard.”

“So if everybody likes your idea, it's too much like the consensus, which means that it's an incrementally better product rather than a radically different product.”

“The way I like to say it is you need at least a Delta IV experience, and so if taxis in San Francisco were three out of 10 good, ride sharing needed to be at least seven out of 10 good. Because if it's seven out of 10 good, then they think you can't compare the two things. I've transcended taxis rather than…”

“The more powerful my insight is, the more likely it is that I can have strong product market fit because I have something highly unique and highly empowering. And by definition, something that's highly unique and highly empowering should have someone desperate for that empowerment. The more empowering it is, the more…”

“If we're not getting product market fit, it's like, okay, what is it that's not working about the audience? What is it that's not working about the implementation? Or do we just not have fundamental insight in the first place? But one of those three things has to be true”

“When you live in the future that way, you're more likely to notice what's new about it. These founders are obsessed with this tinkering of new technology that they're with, and so their instincts about what to build are far more likely to be right, because they're encountering firsthand the limits of the capabilities,…”

“That's why it's more correct, in my view, to think of it as a movement rather than a market at first. It's a movement where a set of people move at first, and at first they're your early believers who believe what you believe about the future. It's a subset of the market, and you can't afford to spend your time with…”

“Most of the great startup ideas come from being surprised by your interactions.”

“This is the biggest problem that startups have is they solve a problem that only exists in the minds of the founders and nobody else.”

“if they've tried to solve the problem before, I know one thing for sure, and that is that they believe the problem exists. If they haven't tried to solve the problem before, on what basis can I assume that they believe the problem exists? If they were desperate to solve it, they would have tried somehow.”

“I think that it has been remarkably robust in explaining why a lot of these startups happen, but it's still very vexing and hard to apply the tenets of the theory at the time that you have to decide. There's still a lot of uncertainty.”

“And so to me, a great startup is pursuing a highly risky, but underpriced future that has wildly asymmetric upside.”

“People who think all the time about a domain and are intensely curious about it for its own sake and pursue understanding it beyond what seems even reasonable Tend to attract luck. They tend to be visited by the muse before it visits other people, and especially people who do that, plus keep their minds open to being…”

“But if you're a hundred and fifty million dollar fund, you don't have to be in all 20 of the top 20 startups. In fact, if you're in one of the top 20 every couple of years, you could be really good.”

“one of the things I tend to believe about Business and life is that it's better to amplify your known strengths and bolster your weaknesses rather than try to turn your weaknesses into strengths out of some source of false misplaced pride.”