The differentiation I’m talking about is doing something that no one else is doing, and that it’s possible no one else can.
Three stories
Pumpkin carver
Find something you’re great at, even if it feels small, and maximize it.
Packy’s sixth grade teacher was a master pumpkin carver. It’s nothing magnificent–doesn’t fix poverty, climate change, cure cancer–but he doubled down on it and made the best out of it.
Breather - what happens when differentiation dies.
Packy worked at a WeWork-like startup before Not Boring. They rented out spaces, booked via an app or phone call, cleaned up etc–it was hard and weird.
No one in their right mind would run a business like Breather.
That was exactly their advantage! Breather was unique, so it had the pricing advantage. Even though it was hard, it was fun coming to work, so they attracted exceptional talent (and retained them). They also skipped the brokers, cultivating a direct relationship with the customers.
But their margins were shit (-25%). After a bunch of some complex business magic, they managed to get their margin up to +25%. The complexity was hard, but worth the differentiated product.
This was too complex for the board, they hired a CEO to simplify all this and make money. He came and simplified stuff, but with each move they looked more and more like WeWork. When you’re the third or fourth biggest player in a competitive market, the worst move is to compete directly with the bigger competitors, to try to play their game better.
They went from product-first to sale-first. Cut costs to compete based on cost (not product), cutting costs led to a worse product. Instead of focusing what Breather was doing better than WeWork, they focussed on what they were doing worse than WeWork. And employee moral plummeted–it’s fun working hard, if you believe in it, and really hard if what you’re doing sucks.
Personal Monopoly
From David Perell’s Write of Passage:
The ultimate goal of writing online is to build a Personal Monopoly. It’s your unique intersection of skills, interests, and personality traits where you can be known as the best thinker on a topic and open yourself up to the serendipity that makes writing online so special.
The Internet uniquely rewards people with Personal Monopolies because it rewards differentiation.
When Packy started writing, he was interested in tech strategy, but he couldn’t compete with Stratechery. So he combined his interest in tech strategy, with pop culture and his less-serious writing style.
Why differentiation matters now more than ever
There are a lot of people following a playbook, re-doing what’s already been done–essentially copying, but more average. But AI, huh, it’s great at average. If something can be taught, it can learn it better. If it can be copied, it can copy it faster. The value of things that can be taught or copied will trend toward zero and the value of fresh new ideas, new ways of doing things will increase.
AI’s creativity is debatable (Is AI actually creative?), but as of now its creativity depends heavily on the data it ingests. If there’s no new ideas, writing styles etc created by humans, our models are not gonna that much.
Also evolution. The whole reason we exist is because some monkey had a flip switched in it, and nature rewarded that flip.
Memorize, code, write, and draw if you love doing those things, if getting your hands dirty helps you think better, if you’re trying to earn your corpus of basic knowledge the hard way so that you can jump off from a stable base, or if you want to do them differently than anyone ever has; otherwise, don’t waste your time. It will regurgitate better than you ever could.
By making the competition to be better at someone else’s game practically futile, it frees us up to play different games.
Metadata
- People:: Packy McCormick
- Related::
- References:: Not Boring article, How Jack Butcher Productized Himself
- Status::
- Created:: 19th Jan 2023
- Updated::
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