Call it what you will. An asset. Your competitive advantage. Your primary strength. Your forte. It doesn’t matter what you name it as long as you know what it is.
An entrepreneur’s strength may be to effectively execute on, provide value with and capture value from an idea. An investor’s competitive advantage may be how he leverages his expertise to solve a start-up’s problems. A scientist’s chief skill could be detecting simple patterns amongst complex data sets.
Your primary asset is what sets you apart. It is what distinguishes you from the crowd. It’s what you’re known for. It’s your fingerprint. Your signature. It’s the main driver of your success.
And the chances are you’ll see more success if you start to treat your primary asset like proprietary technology.
Google’s search algorithm is proprietary tech. So are the recipes for Coca-Cola and Heinz tomato sauce. In Zero to One, Peter Thiel makes the point that “any new and better way of doing things is technology.”
Proprietary technology doesn’t have to reside in Silicon Valley or be protected by lawyers, copyrights and trademarks. A politician’s proprietary tech could be his network and the favours and debts he has accumulated.
Here’s how Thiel describes it:
“Proprietary technology is the most substantive advantage a company can have because it makes your product difficult or impossible to replicate.”
Is what you offer inimitable? Could one of your clients get a similar result from another provider at the same cost?
Thiel goes on to say:
“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.”
If what you can offer is two or three times better than what everyone else is offering, you have an advantage. You can be a success by leveraging it intelligently.
But by striving to be ten times better, you could transform your primary asset into something else. Something that nobody else can compete with. Something that gives you an unrivalled advantage.