Zero to One

Zero to One: Notes on Startups, or How to Build the Future by Peter Thiel, with Blake Masters, is a compelling treatise on innovation, growth, and shaping tomorrow’s economy. While the book is renowned among entrepreneurs, its lessons are equally relevant to policymakers and regulators responsible for fostering frameworks that support progress and benefit society at large.

Rethinking Progress: Zero to One versus One to N

Thiel begins by drawing a crucial distinction between two types of progress. "Zero to one" describes the act of creating something fundamentally new—an unprecedented leap such as inventing the internet, the microchip, or a novel drug. In contrast, "one to N" refers to the process of making incremental improvements to what already exists, like building another smartphone or efficiency improvement in existing grids.

For regulators, understanding this distinction is pivotal. Incremental progress is reliably measurable and fits neatly into existing frameworks and regulations. Breakthrough innovation—going from zero to one—demands flexibility. It often doesn’t map to old categories, and if regulated too rigidly, novel products or paradigms may never emerge at all.

Monopoly versus Competition: The Innovation Ecosystem

A core argument in "Zero to One" is that monopolies drive innovation. Contrary to conventional wisdom, Thiel suggests that successful innovators strive to create and maintain markets for themselves—at least temporarily—by offering products or services so unique that competitors cannot easily imitate them. Efforts to force immediate competition can stifle the scale and stability required for breakthrough innovations to take root.

For regulators, this provokes an important policy consideration: When does fostering competition benefit society, and when does it risk deterring radical innovation? Thiel’s view is that encouraging healthy, temporary monopolies—where companies can enjoy profits that reward risk-taking—leads to greater long-term progress. By contrast, excessive focus on competition from the outset can lead to fragmentation or discourage ambitious projects that require long runways without immediate rivals.

The Value of Secrets: Knowledge and Discovery

Thiel places strong emphasis on the importance of seeking secrets—truths that are not widely known or accepted. Entrepreneurs discover secrets by questioning accepted norms and probing beneath the surface. For example, harnessing an overlooked technology or reevaluating a sector’s core assumptions can yield transformative breakthroughs.

Effective policy encourages such discovery by creating environments that reward thoughtful exploration and permit deviation from established practices. Regulatory frameworks should, therefore, support safe experimentation and respect dissenting voices, recognizing that regulations built only around existing realities risk missing the transformative promise of uncovered secrets.

Foundational Strength: The Role of Planning and Institutions

Contrary to the popular image of reckless entrepreneurs, Thiel highlights that the most successful innovators plan meticulously and build strong foundations—from how teams are assembled to how companies are structured. Sustainable progress arises not from chaos but from clear vision and strategic execution.

This lesson resonates with the regulatory environment. Good regulation, like good company design, arises from clear goals, transparent processes, and accountability mechanisms. Policymakers, too, must forecast the future, anticipate risks and opportunities, and build adaptable frameworks.

Technology and Complementarity: Not All Innovation is Software

Thiel warns against a narrow focus on “tech” as synonymous with computer software. True innovation occurs in every sector, from energy and healthcare to manufacturing and infrastructure. The book provides examples such as SpaceX and Tesla as instances of “going from zero to one” in industries long thought stagnant.

For regulators, this underscores the importance of broad-based innovation support—not just for the most visible “Silicon Valley” companies, but across the spectrum. Incentivizing experimentation in critical physical domains like energy, water, and transportation is just as vital.

The Challenge of Singular Vision: Contrarian and Correct

Perhaps Thiel’s most provocative point is that, to create and capture lasting value, innovators must be both contrarian and correct: they must believe and act on insights others overlook, and those insights must prove true. Applied in the regulatory context, this means that simply following what is popular, or bowing to public pressure, does not always serve the long-term public interest. Sometimes, supporting seemingly unpopular or misunderstood initiatives is what moves society forward in leaps rather than steps.

Policies should, therefore, be structured to allow room for thoughtful contrarians to operate and prove their case—while preserving necessary safeguards.

The Regulator’s Role in Building the Future

"Zero to One" challenges both entrepreneurs and policymakers to recognize that progress is not automatic. Regulatory choices can either enable or constrain the kind of generational leap that benefits everyone. By appreciating the difference between true innovation and mere incrementalism, fostering environments that reward risk and experimentation, and granting time for new ideas to prove themselves, regulators can become true partners in building a better future.

A balance between protection and permission, between skepticism and support, is required. It is in this nuanced approach—recognizing that society cannot simply regulate its way into the future, but must also nurture it—that policymakers rise to Thiel’s challenge: to help enable the leaps from zero to one that define lasting progress.