

Lessons from Peter Thiel's Class On Startups - azazo
http://www.forbes.com/sites/ryanmac/2012/06/07/ten-lessons-from-peter-thiels-class-on-startups/

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dllthomas
> But in perfect competition, nobody actually makes any money; all economic
> profits are competed away.

This is incorrect. Competition drives economic profit to zero in the long run,
but!

First, there's also the short run - "in the long run, we're all dead", etc -
where gobs of money could be made.

More importantly, economic profit includes a term for opportunity cost - money
you'd be making with your next best option. So if you have an alternative that
would also be making you lots of money, and your economic profit is zero,
you're making lots of money.

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loboman
Can you add some detail? Isn't it true that in a competitive market the actual
profit tends to 0, in the long term? (whatever you call it; the actual money
you make at the end of the day). From what I understand in your message, this
is not true, but the truth is that there is a different value, "economic
profit", that tends to 0. Is that right? If so, why doesn't the actual profit
tend to 0?

Edit: most importantly, how can the economic profit include a term for
opportunity cost, isn't the opportunity cost different for every person /
company?

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dllthomas
It's been a while since I took micro, but from what I recall...

In a competitive market, the "actual" (IIRC, the term you want is
"accounting") profit doesn't tend toward zero, no. If it falls low enough that
more accounting profit could be had elsewhere, firms will move to that
elsewhere, supply will be reduced while demand stays the same, and firms will
see more accounting profit.

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cdjarrell
I'm very grateful for Blake Masters taking the time to type up his essays on
his class notes for the rest of the world that didn't get to sit in on this
class. If he wants to get his name out there more with your typical 4 page/3
bullet points per page/10 point lesson that is on Forbes.com then that's fine.

It's an alright article but don't let that take away from what he did over the
last 10 weeks

~~~
stfu
Blake did indeed a great job typing up his notes in these very enlightening
essays. Always enjoyed reading them. Glad to see that his sharing efforts get
fully credited by Forbes/Ryan and not just the typical aggregation recycling
write-ups.

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swombat
Way to condense what, going by the one on founder/heroes, is an awesome series
of insightful lectures, into a crappy set of ten platitudes.

~~~
rmason
Without the authors notes we wouldn't have learned anything from those
lectures.

I received value from his summary and wouldn't remotely classify it as crappy
but YMMV.

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sparknlaunch
Forbes! Congrats to Blake. Only spotted the notes on his blog via HN. Now
guest blogger on Forbes. One good motivation for writing notes in class!

