By Clay Chandler

Clay is an author, editor and fellow at Hult International Business School where he follows technology, economics and global business. He is a former Asia editor at McKinsey & Company, and has held senior editorial roles at Fortune, The Washington Post and the Wall Street Journal. Follow him on Twitter @claychandler

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Since its publication late last year, Zero to One has become the most hotly debated book in Silicon Valley.

It is a contrarian polemic, which is pretty much what you’d expect given that its author, Peter Thiel, is a gay, Christian, libertarian billionaire with degrees in philosophy and law from Stanford who is known for advocating “seasteading” (building lawless urban utopias on the high seas) and offering scholarships to entice smart kids with big ideas to drop out of college.

For would-be entrepreneurs, this book is a must-read, if for no other reason than that Thiel also happens to be co-founder of PayPal, the online payment service, and Palantir, one of the world’s most successful data mining companies. He was also the first outside investor in Facebook (on whose board he serves), and has been a major early stage investor in Airbnb, Spotify, LinkedIn and SpaceX. If that’s not enough street cred for you: he’s generally thought to be the real life inspiration for Peter Gregory, the eccentric tycoon in the HBO’s sardonic comedy Silicon Valley. Fortune magazine, which put Thiel on its cover last fall, has declared him “America’s leading public intellectual.”

The book is based on “CS183,” which Stanford insiders will know as the catalogue designation for the undergraduate computer science course Thiel taught during Stanford’s Spring 2012 session. (Co-author Blake Masters was a student in that class, took detailed notes and posted them on his blog). The big idea, reflected in the title, is that incremental tinkering is for losers. Thiel believes truly valuable innovation comes not from building a better mousetrap but from creating breakthrough stuff that is genuinely new—like the first airplane or the first home computer. As he puts it: “If you take one typewriter and build 100, you have made horizontal progress. If you have a typewriter and build a word processor, you have made vertical progress.”

It follows, Thiel insists, that not just anyone can make that sort of vertical progress. Big breakthroughs don’t come from smart kids all taking the same tests, going to the same schools, chasing after the same grades and academic awards, according to Thiel. True innovation, he believes, requires contrarians and iconoclasts, people whose thinking isn’t just different but at times borders on anti-social. Hence Thiel’s peculiar and vaguely cult-like definition of what a startup is: “The largest group of people you can convince of a plan to build a different future.”

Much of Thiel’s book is a screed against American colleges and graduate schools, which he thinks have become little more that status factories. Thiel seems to regard students who make it into those institutions as a vast herd of over-achieving, under-imaginative lemmings, aimlessly chasing after everyone else into “safe” professions like consulting, banking, law and medicine, and utterly failing to create cool new stuff that can shake up the world. (One of the book’s best zingers: “All Rhodes Scholars had a great future in their past.”)

It helps to know that Thiel himself was once the sort of grind he now decries. He earned top marks as an undergraduate and law student at Stanford, and narrowly missed out on winning a coveted Supreme Court clerkship. He now sees that “failure” as the best thing that ever happened to him. Thiel thinks that, for entrepreneurs, business schools are a particularly egregious waste of time.

One of the book’s most controversial arguments is that entrepreneurs shouldn’t obsess about whether their ventures are “competitive.” Great entrepreneurs, he argues, shouldn’t bother going head-to-head with products that are already out there. Rather they should seek monopolies—areas where they can be so different, and get so good, that rivals can’t really touch them. Indeed, Thiel argues that competition is the “opposite of capitalism” because when there is too much competition, firms aren’t able to accumulate the capital they need to do really momentous things. To hear Thiel tell it, monopoly is a pre-requisite of success.

Not surprisingly, then, Thiel reserves great disdain for the tech industry’s infatuation with “disruption.” Entrepreneurs, in his view, shouldn’t bother trying to compete with ideas or products that will “disrupt” things that already exist. They should invent new things that don’t exist at all.

Zero to One: Notes on Startups, or How to Build the Future, by Peter Thiel with Blake Masters (Crown Business) 2014.