Zero to One: Notes on Startups, or How to Build the Future

by Peter Thiel

As a good rule of thumb, proprietary technology must be at least 10 times better than its closest substitute in some important dimension to lead to a real monopolistic advantage. Anything less than an order of magnitude better will probably be perceived as a marginal improvement and will be hard to sell, especially in an already crowded market. The clearest way to make a 10x improvement is to invent something completely new. If you build something valuable where there was nothing before, the increase in value is theoretically infinite. A drug to safely eliminate the need for sleep, or a cure for baldness, for example, would certainly support a monopoly business.

10x is a lot. I've been playing with the new email service Superhuman - its marginally better than Gmail, but not 10x. Though if they nail email, maybe they could apply their improved UX to a slew of other products and rachet up. So can you start with 1.5x better and increase?