Why I’m Anti-competitive And You Should Be too

Why I’m Anti-competitive And You Should Be too

Why I’m Anti-competitive And You Should Be too

What would your business be like if you had excess demand with no competition?

While monopolising your entire industry is unlikely, it’s easier to build your own micro-monopoly.

In their book Blue Ocean Strategy authors W. Chan Kim and Renée Mauborgne challenge companies to:

break out of the ‘red ocean’ of bloody competition by creating uncontested market space that makes the competition irrelevant. Instead of dividing up existing-and often shrinking-demand and benchmarking competitors, blue ocean strategy is about growing demand and breaking away from the competition.

The book (a must read if you haven’t) uses innovative companies like Cirque de Soleil as examples of companies that solved a unique problem so much better than anyone else that they effectively created what Peter Thiel refers to in his book Zero to One as a ‘Creative Monopoly’.

Thiel describes a Creative Monopoly as one that “creates new products that benefit everyone and create sustainable profits for the creators.”

Some examples include Uber, Apple (5 years ago *sniff*), Google and Amazon.

In contrast, a competitive ‘red ocean’ is when there is a lack of meaningful differentiation industry wide, resulting in eroding profit margins for everyone leading to a grinding fight for survival and eventual obsolescence / extinction.

For those readers that may have an ideological resistance to the concept of a monopoly, be honest: Would you rather be making something that is so similar to everyone else that you’re forced to fight for every dollar, or would you rather have created something that is so radically different that the market overwhelmingly chooses you above all else, regardless of price?

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This got me thinking about the challenges my clients and I face.

I (and others) talk a lot about the fact that the internet means it’s never been cheaper or easier to start a business.

This is awesome except for the fact that as a result, more people than ever are in fact starting their own businesses, creating an increase in competition for everyone.

By it’s very nature, increased competition (for those that are in fact competing) increases struggle while reducing profitability.

If you’re an accountant, real estate agent, personal trainer or any other variety of skill based service provider, by both W.Chan and Peter Thiel’s definitions, you’re operating in a ‘red ocean’ of intense competition.

It appears you have two options:

1. Think like a Edison, Rockefeller, Page, Jobs, Edison, Musk, Zuckerberg and go about creating an entirely new industry category.


2. Stay in your competitive ‘Red Ocean’ of mediocrity and struggle to earn ever decreasing profits until you either burn out or are pushed out of the market entirely.

This is the equivalent of a casual fitness enthusiast being told they’ve got two options: win a gold medal at the olympics, or die.

In his book “Zero to One’ Peter Thiel extolls the value in operating in contrast to the majority.

He asks:

What important truth do very few people agree with you on?

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