Being contrarian is often critical to the process of becoming massively valuable (unless you are a politician). If you can bet on something that nobody agrees with, and win, there’s nothing like it. I’ve written on this topic at length, but turns out that wasn’t enough. It’s still easily misunderstood, which is a shame. In this (short) post, I’ll try to fix that.
First, let’s go back to Peter Thiel in Zero to One.
Whenever I interview someone for a job, I like to ask this question: “What important truth do very few people agree with you on?”
This question sounds easy because it’s straightforward. Actually, it’s very hard to answer. It’s intellectually difficult because the knowledge that everyone is taught in school is by definition agreed upon. And it’s psychologically difficult because anyone trying to answer must say something she knows to be unpopular. Brilliant thinking is rare, but courage is in even shorter supply than genius.
If you pursue an opportunity that everyone agrees is attractive, you’ll have a difficult time distancing yourself from an army of competitors—be it a business or an investment. But if you pursue an opportunity that conventional wisdom ignores (or, even better, disdains), you will have the time you need to refine your idea into a well-oiled machine.
Amazon pursued ecommerce when people didn’t think consumers would feel comfortable using credit cards online. Google launched its search engine when people thought search was a mature commodity. Facebook built its social network when people believed social networking to be either useless, a market dominated by MySpace, or both.
We can all agree that great ideas look dumb at first. But being contrarian doesn’t mean that dumb people disagree with you; it means that smart people disagree with you. This is the most important part of being truly contrarian that people don’t understand. Let me explain with an example.
When the Airbnb guys tried to pitch their idea, Paul Graham, the highly regarded founder of Y Combinator, told them flat out that their idea was terrible. “People are actually doing this?!” he incredulously asked. When Brian Chesky told him yes, people were in fact renting out their living spaces for a night, Graham’s response was, “What’s wrong with them?” Graham couldn’t imagine why people would ever use the service.
Graham didn’t understand the business not because he was dumb, it was the opposite. Despite being super smart, this idea didn’t make sense to him, and this is very important. Lots of people disagreeing with you isn’t enough. You have to see if smart people are disagreeing with you or not. One smart person disagreeing has more value than an infinite dumb people disagreeing.
Who is smart, you ask? Well, if you ask that to yourself it isn’t very hard to answer. Most venture capitalists and angel investors are smart. People who invest in unproven ideas and believe it’s better than investing in proven ideas are smart. In fact, Airbnb was so contrarian that even the smartest investors passed on them. This is usually a bad sign, but if you are contrarian and true, it’s the best sign. 99.9% may completely disagree with you, but you know for sure that the rest of the people—the ones who agree with you—are super duper smart. There’s nothing better than having smart folks as your allies.