This past Wednesday, famed venture capitalist and founder of PayPal Peter Thiel spoke to the Booth School of Business in Illinois, Chicago. In his talk on entrepreneurship, Bitcoin, and business practices, Thiel admitted that he felt that Bitcoin is a product which was founded on the same set of ideas as PayPal; however, the two have clearly developed in completely opposite directions. Coming from the founder of PayPal, this was more than a tacit admission that each business idea has multiple paths to different types of success. Thiel continued:
Bitcoin is the opposite of PayPal, in the sense that it actually succeeded in creating a currency,” he said. “However, its payment system is lacking, and it is often used to make illegal transactions, such as to buy heroin. Until Bitcoin is used to make more legal transactions, I am a bit skeptical.
Both supporters and detractors of Bitcoin might support this statement for different reasons. Depending on your personal opinion of centralized institutions such as PayPal, or essentially free (to be traded for heroin) transaction systems, you might even read Thiel’s statement in different ways. Thiel is well-known for his Thiel Fellowship, which offers twenty individuals under 20 $100,000 to pursue their entrepreneurial dreams in lieu of university.
Peter Thiel Gives Unique Business Advice
Speaking to the crowd of over 1,000 attendees, Thiel reminded the group of mostly still-hopeful entrepreneurs that the common myth that all low-hanging fruit (business ideas) have already been picked, ripened, and turned into mash may be true, but in reality holds you back.He explained: “I’m telling you that it has always been intermediate-hanging fruit, and it is up to us to find it and pick it.” His advice to those with profitable intermediate-hanging fruit within their grasps was to “seek to establish a business monopoly.” According to Thiel, monopolies are only bad when they artificially reduce the supply of a particular good, something that he argues corporate behemoths such as PayPal and Apple have not done.
What do you think about Thiel’s comparison of Bitcoin and PayPal? Comment below!
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