His premise is: "What valuable company is nobody building?" [1] That sounds like avoiding competition to me.
If Google had wanted to compete, it would have gone for Yahoo, and become a portal, and tried to maximize user time on the site. The conventional wisdom was that Yahoo was far more worthy of competition than AltaVista. AltaVista wasn't even a company; it was almost shut down by its parent company IIRC. And it didn't make any money. Nobody wanted to compete with AltaVista. Search was viewed as a feature, not a company.
Facebook also avoided competition in its early years by being closed to the public and signing up one college at a time. They formed monopolies on social networks within specific colleges, and leveraged that position to expand to the rest of the world.
The idea is not to compete "head on". Don't just try to do same thing, but better. Do something different. It's hard to imagine what the world was like before Google or Facebook, but they were both doing something radically different early in their lives.
If Google had wanted to compete, it would have gone for Yahoo, and become a portal, and tried to maximize user time on the site. The conventional wisdom was that Yahoo was far more worthy of competition than AltaVista. AltaVista wasn't even a company; it was almost shut down by its parent company IIRC. And it didn't make any money. Nobody wanted to compete with AltaVista. Search was viewed as a feature, not a company.
Facebook also avoided competition in its early years by being closed to the public and signing up one college at a time. They formed monopolies on social networks within specific colleges, and leveraged that position to expand to the rest of the world.
The idea is not to compete "head on". Don't just try to do same thing, but better. Do something different. It's hard to imagine what the world was like before Google or Facebook, but they were both doing something radically different early in their lives.
[1] http://www.wsj.com/articles/peter-thiel-competition-is-for-l...