In this episode, Jason Blumer and I dig into Peter Thiel’s book “Zero to One“.
You can listen to the episode here:
For more on Jason, you can find his company at BlumerCPAs.com and more about him at JasonBlumer.com.
Full Transcript:
Mickey: Every moment in business happens only once. The next Bill Gates will not build an operating system. The next Larry Page or Sergey Brin won’t make a search engine. The next Mark Zuckerberg won’t create a social network. If you are copying these guys, you aren’t learning from them. So that was from Peter Thiel’s book, Zero to One.
And here with me to discuss it is Jason Blumer. So Jason, tell the folks a bit about yourself.
Jason: What’s up, Mickey. Thank you for having me on your show. I’m a daily reader of your blog.
Mickey: Oh, nice.
Jason: thank you for doing that. Um, so I’ve been leading a virtual CPA firm focused on digital marketing agencies for, you know, getting close to 25 years, not
Mickey: Wow.
Jason: and lead other, another community, a consulting community for other accounting firm entrepreneurs, we call them. And that’s another business called thrival.
Mickey: Nice. Awesome. Yeah. We’ve been a client of yours for what? Six or eight years now? It’s been a while. Like, yeah. You talk about CPA firm for creative agencies. Like that’s us. And it’s been fantastic with you having that, that angle on things. So it’s been great. [00:01:00] So, um, so you pick this book as with all my guests in here, I say you pick what book we’re going to do and you pick zero to one.
So I know you have a lot, a lot to say about it. So why don’t you just kind of give us the overview of why you, why you like this book so much?
Jason: Okay. Yeah. So Thiel is a contrarian.
Mickey: Yep. I have a few thoughts in there that he says quotes in the book that
Jason: yeah. He’s so he’s a, he’s an extreme contrarian, which I enjoy.
Mickey: mm hmm.
Jason: so I’ll enjoy looking at things from a different vantage point. And yeah, yeah. I just dive into the, my
Mickey: Yeah. Hit it. Yeah. Go for it.
Jason: so I love when he interviews people, this is the very first part of Chapter 1, he says, I ask him a question, what important truth do you, do very few people agree with you on? Um, which is, which is an amazing question, but I love in Chapter 3, he turns that into the contrarian business building question, which, where he says, what valuable company is nobody building? and I love that spin. now, and we kinda, we. [00:02:00] That contrarian question, we kind of help, we use it now to help entrepreneurs that we’re working with them on. And like, instead of him asking, Hey, think of a company that’s valuable that we could build. He’s trying to get you to think of the one that needs to be built, that’s not being built. And so when we work with entrepreneurs, we basically, we kind of stole this methodology. They’re trying to take a risk to grow or hire or acquire another agency or whatever. And we’re always helping them try to know there’s two risks. You’re always managing, which is what if you don’t. that agency. What is the risk you’re currently bearing by not moving forward? Um, and so that’s kind of a flip. And so we can, I got it from this contrarian flip instead of saying, you know, what’s a valuable company we should build.
He goes, which, what is the company that’s not currently being operated,
Mickey: Yeah. I
Jason: is a totally different way to look at it. Uh, so risk based management can be like that, which is, do you want to take this risk? But what is the risk you’re currently [00:03:00] incurring by not Having taken that risk yet. So there’s always two risks to compare yourself again.
So, so we kind of get to think about things in a more contrarian way and coach with agency in her. So
Mickey: like that.
Jason: that part. That’s one of the biggest parts that hit me in this book.
Mickey: Yeah. And something you said to us a lot is you get what that means. Like any decision you make, you got to get the good stuff and the bad stuff. You know, you get whatever that decision means. And so he’s saying you’re going to, if you don’t acquire that business, you get what that means. Like, sure.
You’re saving money from not acquiring it, but then you’re not going to grow or whatever the case is. And yeah.
Jason: Yeah. And you can, you can spend that, you know, get what it means on, on your, you know, a lot of entrepreneurs don’t know what it takes to sacrifice for a business for it to grow. Uh, and you do have to sacrifice a lot to make a business, uh, grow. And, you know, he, he gives us a lot of ways to look at things in, uh, different ways, uh, which are, which are kind of mind blowing.
Mickey: Yeah, he does. Yeah. One of the somewhat contrarian things he says, but I think you and I will agree with his work signaling. He said, quote, in the most dysfunctional [00:04:00] organizations, signaling that work is being done becomes a better strategy for career advancement than actually doing the work. If this describes your company, you should quit now.
And that came to mind. I was actually, I was in a podcast yesterday with Cal Newport who did deep work. Um, I’m guessing you probably read that. And he had a quote that from, from his book that I thought tied in here said, if you send an answer emails at all hours, if you schedule and attend meetings constantly, if you weigh in on instant messaging systems, All those behaviors make you seem busy in a public manner.
If you’re using busyness as a proxy for productivity, that these behaviors can seem crucial for convincing yourself and others that you’re doing your job well, which doesn’t mean you’re doing your job. Well, I mean, part of it does, you got to answer emails and stuff, but you see people are so busy and they’re so proud of how busy they are, but they’re not actually getting things done.
So, Oh
Jason: and I think it’s important for entrepreneurs to have, um, to have structures and systems. So as entrepreneurial companies grow, especially service based organizations, and that’s the ones me and my partner work with on is just helping a service based company scale and you, you scale that with more people or it’s [00:05:00] controllable too.
You don’t have to scale, you know. Um, but you add more people and that’s how you scale. And it’s difficult to do that. You have to add structure, uh, and kind of really create order from chaos. I think that’s what entrepreneurs do.
Mickey: yeah. Yep.
Jason: actually starts solving some of that, that issue, which is team members who want to signal that they’re working a lot. Which is really sometimes I call kicking up dust, right? They’re just kicking up a dust cloud form. But the larger you get in, the more structure you add to a company. Actually, a lot of that stuff starts to stand out more because you have more protocol, more core value philosophy people are following. And then it forces some of your other team members to start standing out that they’re not, you know, following kind of the path that the rest of the team is.
Mickey: Hmm.
Jason: does that structure brings accountability. To kind of avoid that signaling.
Mickey: Interesting. I, I would have thought that I would have sort of thought the opposite where the smaller team is easier to see when people are signaling versus working, but that’s a good point. As you get better [00:06:00] structures in place,
Jason: Right?
Mickey: you got to fit in the box. Yeah.
Jason: I think it is. So when you’re, when you have a smaller team, uh, and there’s, there’s kind of some, some, some team, um, I don’t know, ranges you can think about, but you know, up to five or six or seven or something like that, an entrepreneur can really have more of an intimate view of what everybody’s doing without a lot of structure.
But as you get bigger, The owners get further away from people, right? So instead of six people, you have 15 or 20. You don’t know who’s really working or not. And that’s when you start leaning on your structure the order you’ve created, the processes, and then people start falling away from the process.
And that’s how you start to be able to tell with a larger team.
Mickey: Gotcha. How big is your team? These guys.
Jason: Uh, so it’s 15
Mickey: Okay. Nice.
Jason: 15.
Mickey: for, yeah, for those that don’t know us, we’re up to nine now with
Jason: yeah,
Mickey: slow growth and we’re, we’re very happy with that. Again, we’ve, we’ve not done a lot of what he says in the book here. We’ve been very cautious and slow and not too contrarian, but it works well sometimes too.
but [00:07:00] I certainly appreciate what he says.
Jason: yeah, yeah. I mean, I, and obviously he’s trying to, he’s trying to teach us right. Philosophies around company building.
Mickey: Yep.
Jason: and he, he does say it’s funny, you know, he talks about. don’t, whether it’s the quote you read, right?
Mickey: Mm hmm.
Jason: do what somebody else is doing, so don’t copy. But you and I do have
Mickey: Right.
Jason: general standard businesses, right?
Mickey: Yeah.
Jason: firm and a digital agency. So, but those still work.
Mickey: yeah.
Jason: Those are still valuable. The economy still needs them. He’s talking to startups, right? That are trying to create these massive valuations. So, he’s talking to people that need to start building something brand new that’s not existed.
Mickey: Yeah. And like, like you said,
Jason: hard.
Mickey: you know, even, even we do need some of those out there, but there’s a need for, there’s a need for more CPA firms and other people to just do the stuff that needs to be done. And then if you want to go for something big, cool, go for it. And there’s always things we can get out of it too.
Like this book, again, if you’re thinking, I don’t want to have a startup like that, this doesn’t apply to me. There’s a ton of great lessons in here that are worth seeing. So one,
Jason: [00:08:00] Yeah.
Mickey: view, I saw in the book where he seems to disagree with himself. And I’m curious your thoughts here. He said at one point, he said, quote, If your product requires advertising or salespeople to sell it, it’s not good enough.
Technology is primarily about product development, not distribution. But later he says, quote, Your products will never sell themselves. Your team needs to do that. And if you’ve invented something new, but haven’t invented an effective way to sell it, you have a bad business no matter how good the product.
Which, I hate that last sentence. I agree with him completely, but I hate it. I always wish the better products, the better services would always rise to the top, but sales and positioning matter so much to make yours stand out, even if it’s not necessarily the best. But, what are your thoughts on that, where he says, if you need salespeople, it’s not good enough, but on the other hand, you need salespeople.
That seems contrarian to me, so.
Jason: I guess the, yeah, the first statement. I don’t know. He speaks in a lot of, um, principles and platitudes.
Mickey: Mm hmm. Mm hmm.
Jason: he’s saying, you know, probably trying to make a point. The value of a company just sometimes should stand on its own. It’s value like Apple, right? They’re a great example. Uh, and I guess they’ve really never had a [00:09:00] other than their stores, right?
Mickey: And those are even relatively new in the history of Apple, so yeah.
Jason: those are, those are new. And I think those were just even part of their experience to, uh, with the product. So some companies are so valuable, they don’t need salespeople. And I think he’s talking about that. But of course, that’s not true for all of of our businesses, right?
Mickey: For sure. Yeah.
Jason: When we don’t have a monopoly, which I love his thoughts on monopolies,
Mickey: He’s very pro monopoly, which is interesting.
Jason: well, I read that and I’m like, of course, that’s a contrarian
Mickey: Right. Yeah.
Jason: loves monopolies and the value they can add, but you and I don’t have a monopoly.
Mickey: Right. Not quite.
Jason: not quite
Mickey: I’m not the only digital marketing firm in the world. So yeah.
Jason: And we’re not the only CPA firm and you know, we’re not the only virtual firm anymore.
That’s becoming more and more
Mickey: Mm hmm.
Jason: common. So, of course, we need salespeople. Uh, of course, we need marketing and positioning, which marketing and sales, you know, are different.
Mickey: Yeah.
Jason: but we have to have that stuff to let people know we exist and that we’re, we’re [00:10:00] valuable and how we differentiate and stand out from our competitor.
Mickey: Yeah. And that’s where being remarkable. It reminded me of Josh Kaufman’s book, the personal MBA. I don’t know if you’ve read that one, but he pulls in quotes from a lot of other people. So in the book he pulls a quote from Robert Stevens that just simply says. Advertising is the tax you pay for being unremarkable.
So if you’re not remarkable enough, you have to advertise more. But again, I think it’s like you where I think some of both is okay. You can advertise and then people see how remarkable you are and you’ll still make the sales. Cause especially in industries like ours, there’s so many out there. You’re not going to just stand out automatically.
So you need some ads or marketing to get people to find you. And then they can see the remarkable difference you have.
Jason: Yeah, for sure. And also when people write books, they’ve got to say cool things that are,
Mickey: There you go.
Jason: that are contrarian. So I don’t know about you, but when I read books or now that I’m older, when I read books, I can really kind of skip, skip the fluff and scan to a lot of the good stuff. So quotes like that are good and I get their point, it doesn’t mean marketing and sales is not needed.
It’ll always be needed
Mickey: Right. But again, back to what he’s trying to do with, you know, [00:11:00] the, the thought of monopolies here, I guess we should unpack that a little bit as he’s saying your business should be so new and stand out from anything. Anyone’s done. It is a monopoly just by default because it hasn’t existed before.
Jason: Right.
Mickey: again, if you can be very remarkable in that monopoly, as it were, then you can, you can dominate there.
It is interesting. I didn’t quite follow him all the way down, but he seems to like monopolies even as they get huge, which I tend to disagree with at that point. But I like where he started with them at least where. Yeah. You should be so unique that you’re a monopoly just by default, because it doesn’t exist elsewhere.
Jason: That’s right. I love, well, right. Cause the, the very existence of a monopoly proves the point that you’ve created something so valuable that you’re really the only provider that can give that. And he makes a point in that section. Uh, the lesson for entrepreneurs is clear. If you want to create and capture lasting value, don’t build an undifferentiated commodity business
Mickey: Mm hmm.
Jason: and you and I are in businesses that could be. commodified
Mickey: No, for sure. Yep.
Jason: um, but the, but the cool thing about my business and [00:12:00] your business is we can get on different parts of a value chain. Like, you know, I, we, we could go all the way down the low value chain and just do a bunch of 1040 individual returns,
Mickey: Mm hmm.
Jason: So we push up in our value chain and our chosen market to businesses.
So we’re only wanting to serve businesses cause they can, they have a better perception of value, uh, you know, then. Individuals can, can actually pay, uh, and same for you. There’s a lot of, you know, commoditization. Um, but he’s just basically saying, yeah, build something that’s so valuable. It just can’t exist somewhere else.
Mickey: Mm hmm.
Jason: I don’t know. So I think in that definition, monopolies are going to be rare
Mickey: Yeah, that too.
Jason: people, right, are going to be
Mickey: And if it does take off, then others are going to jump in right away to try to get a piece of the pie. So, yeah.
Jason: Totally.
Mickey: with Uber. I don’t know if Uber was technically the first, but they felt like the first. But then you’ve seen others lift, and other smaller ones come up quickly, where Yeah, that happened there.
Yeah, the commodity stuff is interesting. [00:13:00] I’m wondering if this is the same for you, but, you know, we build WordPress sites, which very easily can be commoditized. We build in custom and have our designer work it and have storytelling behind it and do it that way, but there’s a commodity market for that, too, where people only have a couple hundred bucks and just want someone to knock up a site for them, which is not us, but we have, we know those people in that part of the market and can support them, and I’m guessing you’re the same, where someone comes and says, Jason, I need my 1040 done, and you’re like, that’s not really what we do, but here’s Martha at this other company, here’s so and so, you know, he’s pointing in that direction to the commodity.
A
Jason: Yeah. Totally. But you know, in the, you know, uh, uh, technology is changing all of our businesses. Obviously that
Mickey: little bit.
Jason: Yeah, just a little bit.
Mickey: Yeah.
Jason: so, so even the 10 forties now cannot even be referred to another firm or person,
Mickey: True.
Jason: you know, they’re like an up work.
There are up works being built for the tax accounting plan. Right?
Mickey: Hmm.
Jason: you know,
Mickey: Interesting.
Jason: just refer into that and there’s, you know, 1500 accountants and they’ll bid on the tax return. Um, but I, the reason I don’t like that, but like you said, Mickey, that is, there is a business for that, right? But [00:14:00] what I don’t like about that is any kind of platform where you bid. Obviously, what are we doing? We’re bidding down
Mickey: Right.
Jason: and that’s a complete opposite belief. I have in the value of companies. I want to build a monopoly. If I could,
Mickey: Right. Yeah.
Jason: the ones that go in front of the Senate right to about because I would want to do that. If I could, I’ve just I just you know, you have to do something, uh, brand new. Um, but so I, I, I don’t like some things. I just don’t believe in going into a platform because now the bid process is to bid down,
Mickey: Right.
Jason: I’m going to choose obviously the lowest bid that I receive. And now we’re, we’re, you know, we’re basing, we’re basing our service on the lowest price,
Mickey: Yep.
Jason: the definition of a commodity.
And so I’m, I want to completely do the opposite of that. And I want to make sure my prices are double what somebody else’s are, if I can, the value is
Mickey: I was gonna say the values there. Cause you’re, yeah, you’re not cheap, but we still [00:15:00] think you’re a steal for the value you bring versus what you charge us. I mean, yeah, your prices seem very low for the value you bring, but they’re higher than other similar firms. So it’s just, yeah. Seeing that value in there.
Jason: And so pricing is a differentiator, right? If you’re trying to not be a commodity, pricing is a way to kind of, that’s one way to set you apart. And I don’t think people use that as a positioning tool a lot of times,
Mickey: Yeah.
Jason: I think we can.
Mickey: Yeah. Seth Godin often said. If you’re in a race to the bottom, be careful, because you might just win, you know, that’s not a good place to be. And he talks about ads too, like with Google ads, like, when it starts out, like, okay, I’m going to pay 25 cents for this Google ad and then make a dollar every time.
But if you make a dollar every time, someone else is going to bid 50 cents and eventually you’re going to be bidding 99 cents to make a dollar. It’s just a push to that because you’re not differentiating enough. And so, let’s see. We’re, we’re getting a little low on time here, so it’s kind of
Jason: Okay.
Mickey: I do like this one other quote here. He says, the most valuable businesses of coming decades will be built by entrepreneurs who seek to empower people rather than try to make them [00:16:00] obsolete, which I kind of disagree with, but gosh, I hope he’s right. Like I really want that to be the case where the most valuable ones will empower people versus trying to make them obsolete because it seems like most of the big companies are working hard to make everyone else obsolete is their kind of, is their kind of goal as monopolies.
What are your thoughts on that verse of empowering people versus making them obsolete?
Jason: Yeah. Um, you know, I think you and I both will believe if we’re running a service based company. We believe in empowering people. That’s kind of what it comes with. If you don’t like people, you’re
Mickey: Thank you.
Jason: to do well if you’re growing a services company,
Mickey: For sure.
Jason: Um, and so I’m all about empowerment of people, but in our economy, there’s going to be both,
Mickey: Mm hmm.
Jason: going to be large businesses and platforms and monopolies. That provides such an extreme value. Yeah. They may churn through their team, their team. If they have 10, 000 people on their team, they just don’t know them.
Mickey: Right.
Jason: so you, you, you have to get in touch with some of your, your community, your employees, uh, or your, your [00:17:00] colleagues, really, that’s kind of your only community.
So, um, but yeah, I’m about empowering people.
Mickey: Oh, yeah. You sure are.
Jason: Yeah, that’s that’s what I want. I want my personal life statement to be about moving people forward. You know, I want being in a relationship somebody with somebody. I want them to have learned something moved forward in some way or had some kind of influence with us.
So I’m a big belief in that a big, big, big part of my work is to sacrifice myself for others.
Mickey: Yeah. Well, the more you can empower, like, clients like us, the longer we’ll stick with you, too. So it’s a win win. You know, it
Jason: yeah. It’s
Mickey: all the way around.
Jason: strategy. So yeah.
Mickey: Helping your client succeed. What a novel thought. It’s crazy.
Jason: I love
Mickey: Um, anything else you want to share from the book?
Jason: Yeah, no, those are good, man.
Mickey: Okay.
Jason: good. But I love the points you did make. So this is a great contrarian book that makes me think. And as you go through it, just like any book, he’s very clear and direct about things he
Mickey: He sure is. Yeah.
Jason: I like [00:18:00] that it bumps up and I can disagree with some of
Mickey: Yep.
Jason: And I love a book that’s so clear about what they believe, I can disagree. And it doesn’t make all of his points, uh, uh, Invaluable. It just is fun to really, uh, absorb that contrarian nature. So even some of your quotes are, um, you know, you disagreed with some of them and I do too, but I love the book because of its contrarian nature, how it makes you think, uh, and we do need to think more like, you know, startups building monopolies and building businesses that have never existed before.
We need to apply some of that thinking.
Mickey: Yeah, that’s a good point though with, it’s a good point with his clarity. I love books that are super clear, even if I disagree, because if they’re contrarian and they’re kind of all over the place, it’s hard to follow, but here you know what he’s going for and you can see the parts that apply and what don’t and
Jason: Right.
Mickey: his clarity is fantastic.
I love authors like him that are so clear in what they believe that you at least know what you’re talking about. So yeah,
Jason: that. And so that’s a book if anybody wants to read it. Yeah. And he does talk about things that some of us can’t achieve maybe, but the way he does it makes you think. [00:19:00] That’s what I love.
Mickey: for sure. Well, Jason, this has been fantastic. How can folks find you and learn more about you?
Jason: Yeah. You can go to BlumerCPAs.com if you want, or you can go to JasonBlumer.com and those are ways to find
Mickey: Cool. I’ll have those in the show notes so people can find there. So great to have you. Always good to talk to you.
Jason: Cool. Thanks
Mickey: All right. See ya.
Jason: See ya.
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