This chapter returns to the contrarian question from Chapter 1 and explores it in depth. Thiel argues that every great business is built on a secret — an important truth that most people do not know or do not agree with. The challenge is that our culture has stopped believing in secrets.
The World Still Has Secrets
Thiel identifies a troubling trend: most people today believe that all the important questions have been answered. The conventional view is that all the low-hanging fruit has been picked — in science, technology, and business. But this view is dangerously wrong.
“Every one of today’s most famous and familiar ideas was once unknown and unsuspected… There is no reason why we should have reached the end.”
— Peter Thiel
If there are no secrets left, then no new company can create genuinely new value. The existence of secrets is what makes 0-to-1 innovation possible.
Three Kinds of Truth
Thiel divides all truths into three categories to explain where secrets fit.
The Spectrum of Knowledge
- Conventions: Things that are easy to figure out. Everyone knows them. They are taught in school.
- Secrets: Hard but not impossible to discover. They require effort, original thinking, or courage to articulate.
- Mysteries: Things that may be unknowable. No amount of effort will crack them.
The productive space is in secrets — truths that are knowable but not yet widely known. If you give up on finding secrets, you stop looking, and you stop building new things.
Why People Stop Looking for Secrets
Thiel identifies four social forces that discourage people from searching for secrets.
Barriers to Secret-Finding
- Incrementalism: From childhood, we are taught to advance one small step at a time. Bold discoveries seem unrealistic.
- Risk aversion: Finding a secret and being wrong means looking foolish. Playing it safe is more comfortable.
- Complacency: If the world has already allocated all its resources efficiently, there is nothing new to find.
- Flatness: In a globalized world, if a secret were there to find, someone else would have found it already — so why bother looking?
These forces converge to create a world where most talented people do not even try to discover secrets. They pursue conventional paths in conventional fields.
How to Find Secrets
Despite the discouraging social forces, secrets are still out there. Thiel offers a framework for finding them.
Two Kinds of Secrets
- Secrets of nature: Undiscovered aspects of the physical world. Found through scientific inquiry.
- Secrets about people: Things that people do not know about themselves, or things they hide. Found through observation and contrarian thinking.
Secrets about people are often more accessible. Ask yourself: What are people not allowed to talk about? What is forbidden or taboo? Often, the best business ideas hide behind social conventions that prevent people from seeing or discussing certain truths.
Practical Secret-Finding
- Look where others are not looking: The most promising areas for secrets are fields that matter but have been neglected
- Ask contrarian questions: What do people believe that is wrong? What are people afraid to say?
- Study overlooked fields: Nutrition, human resources, and many other important areas are understudied relative to their importance
- Start with what you know: Your unique perspective and experience may reveal secrets invisible to others
What to Do with Secrets
Once you find a secret, Thiel advises caution about who you share it with. A secret shared too broadly ceases to be an advantage. The practical approach is to share it only with the people you need to build a company around it.
“So who do you tell? Whoever you need to, and no more. In practice, there’s always a golden mean between telling nobody and telling everybody — and that’s a company.”
— Peter Thiel
Key Takeaways
- Every great business is built on a secret — an important truth that most people do not see
- Conventions are easy, mysteries are impossible, but secrets are the productive space for innovation
- Incrementalism, risk aversion, complacency, and globalization discourage people from looking for secrets
- Secrets about people — social dynamics, hidden needs, forbidden truths — are often the most accessible
- Share your secrets only with those you need to build a company around them
- If you think there are no secrets left, you will not try to find them, and you will never build anything new