Chapter Two – Party Like Its 1999 

If you can identify a delusional popular belief, you can identify what lies behind it. This is the contrarian truth. Take the 90s for example, some people have only warm nostalgic memories of this era. But both good and bad things happened in the 90s. Including the economic recession, unemployment that followed along with it and war.

The old economy couldn’t handle the effects of globalization, something needed to work and in a big way. The new economy of the internet was the only way forward.

The dot com mania was short but intense and lasted a period of only 18 months. There was money everywhere and no shortage of sketchy people to chase after it. Investors were throwing money at any startup. Everybody should have known that the mania was unsustainable. The most successful companies embraced an anti-business model where they lost money as they grew. Irrationality was rational given that adding “.com” to your name could double your value overnight. Companies exist to make money not lose it. This wasn’t an obvious fact in the 1990s.

There were four big lessons learned from the dot com crash that still influence businesses today

• Make incremental advances
• Stay lean and flexible
• Improve on the competition
• Focus on the product not sales

According to Thiel, planning is key. Competitive markets aren’t where the big profits can be found. It’s better to create new markets. It is also important to keep in mind that sales are as important as the product, advertising is not a waste of resources.