Peter Thiel on Competition: Why Following the Crowd Could Be a Trap

Peter Thiel, co-founder of PayPal and Palantir, has always challenged conventional thinking. One of his boldest perspectives is on competition, which he sees as more of a trap than a true path to success. According to Thiel, society often teaches us that competition is inherently valuable—that if a lot of people are pursuing something, it must be worth pursuing. But in his view, this can be misleading.

Peter Thiel, Co-founder, PayPal

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The Safety of the Crowd

Thiel likens this mindset to people standing in a long line without even questioning why they're there. The logic goes: If everyone wants it, it must be good. This herd mentality, he says, is deeply ingrained in us. He even references Shakespeare’s time, where the word "ape" meant both primate and to imitate, highlighting how humans are naturally drawn to mimicry and group behavior.

But what happens when we simply follow the crowd? Thiel argues that while competing with others can certainly make you better at a specific skill, it comes at a cost. For example, spending years prepping for an SAT might make you great at taking that test, but you might lose sight of broader, more important questions about what truly matters in life or business.

Missing the Bigger Picture

Thiel’s argument is clear: Competing just to compete can blind you to more valuable opportunities. By focusing so heavily on outperforming others, we can easily lose sight of what’s truly innovative or unique. Instead of chasing after what everyone else wants, Thiel believes that success comes from doing something different—something that nobody else is doing.

Examples of Non-Conformity in Business

Take Google, for example. When it started, it wasn’t competing with other search engines by following their playbook. Google wasn’t focused on winning the competition for the best advertising deals at first; it was focused on solving a fundamentally different problem—organizing the world’s information in a way that was better than anything else. This unconventional focus is what allowed them to outgrow their competitors.

Similarly, Elon Musk didn’t launch Tesla to compete with other car manufacturers on their terms. He saw an opportunity in electric vehicles when no one else was paying attention. By avoiding the competitive rat race and focusing on something new, Tesla is now leading the electric vehicle revolution.

Thiel's message is simple: Don’t compete—create. Success is about carving your own path, not fighting for the same prize as everyone else.

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Source: Stanford Law School 'Peter Thiel Returns to Stanford to Share Business Tips from "Zero to One"'