A-great-business-plan

How to Build a Great Business Plan According to Peter Thiel

According to Pether Thiel, former CEO of PayPal and founder of the software company, Palantir, there are seven questions to answer if you want to create a company that will go from Zero to One.

Those questions are critical to building a business which will be able to capture value in the long run. In fact, according to Peter Thiel the value of a business isn’t to go from 1 to but to real value is to go from Zero to One. In short, build a company that creates new things, rather than building a business based on the existing “best practices,” which according to Peter Thiel leads to dead ends.

This framework of going from Zero to One can be summarised in seven questions to answer if you want to have a great business plan. In fact, you don’t need complicated Excel models or reasonings. You only need to address now these seven questions.

Indeed, that is how Peter Thiel puts it in Zero to One:

Whatever your industry, any great business plan must address every one of them.If you don’t have good answers to these questions, you’ll run into lots of “bad luck” and your business will fail. If you nail all seven you’ll master fortune and succeed.

The Engineering Question

Can you create breakthrough technology instead of incremental improvements? 

The Timing Question

Is now the right time to start your particular business

The Monopoly Question

Are you starting with a big share of a small market? 

The People Question

Do you have the right team? 

The Distribution Question

Do you have a way to not just create but deliver your product?

The Durability Question

Will your market position be defensible 10 and 20 years into the future? 

The Secret Question

Have you identified a unique opportunity that others don’t see? 

How to get started with your business:

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Business Competition

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In a business world driven by technology and digitalization, competition is much more fluid, as innovation becomes a bottom-up approach that can come from anywhere. Thus, making it much harder to define the boundaries of existing markets. Therefore, a proper business competition analysis looks at customer, technology, distribution, and financial model overlaps. While at the same time looking at future potential intersections among industries that in the short-term seem unrelated.

Business Scaling

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Disruptive Innovation

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Disruptive innovation as a term was first described by Clayton M. Christensen, an American academic and business consultant whom The Economist called “the most influential management thinker of his time.” Disruptive innovation describes the process by which a product or service takes hold at the bottom of a market and eventually displaces established competitors, products, firms, or alliances.

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History of Innovation

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Innovation in the modern sense is about coming up with solutions to defined or not defined problems that can create a new world. Breakthrough innovations might try to solve in a whole new way, well-defined problems. Business innovation might start by finding solutions to well-defined problems by continuously improving on them.

Read also: Business Strategy, Examples, Case Studies, And Tools

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