The path from Zero to 1

Every firm in a competitive market is undifferentiated and sells the same homogenous products. since no firm has any market power, they must all sell at whatever price the market determines.

if there’s money to be made, new firms will enter the market, increase supply, drive prices down, and thereby eliminate the profit that attracted them in the first place.

if too many firms enter the market, they will suffer losses, some will fold, and prices will rise back to sustainable levels

Under perfect competition, in the long run no company makes an economic profit.

The opposite of perfect competition is monopoly.

whereas a competitive firm must sell at the market price, a monopoly owns its market, so it can set its own prices. Since it has no competition, it produces at the quantity and price combination that maximizes its profit.

To an economist, every monopoly looks the same, whether it deviously eliminates rivals, secures a license from the state, or innovates its way to the top.

However, the best form of monopoly is to be so good at what you do that no other company can offer.

Google would be a perfect example; it hasn't competed in search since the early 2000s, when it definitely distanced itself from Microsoft and Yahoo - proprietary search algorithm.

Google was so good, the word “google” is now an official entry in the Oxford English dictionary - as a verb.

If you want to create and capture lasting value, don’t build an undifferentiated commodity business.

This is what we are doing at OyaPay through our proprietary algorithm and Bluetooth tech we have built a platform that empowers merchants to receive payment with or without internet data.

Credit: zero to one - Peter thiel