Naval Ravikant on why founders shouldn’t chase trends

“Trend chasing is a lot like macro chasing. It’s often too late.”

In the clip below, Naval argues that trend chasers will usually get drowned in a sea of copycats or they will eventually get crushed by the company that established the industry. He cites AI as an example.

“The thing that is always the best to do is something that you know really well and have conviction about. Usually it’s that you’ve worked on a product because you want it to exist for yourself or it’s an industry that you know really well or there’s some technology that other people don’t get but you’re intellectually obsessed with.”

Naval’s favorite companies are the ones that are doing something technologically challenging and difficult that the founder is passionate about but that’s not in an easy-to-define field or trend.

“Wealth is a byproduct of knowledge… What you should be doing when you are creating a startup is not asking what space is hot. Instead, ask ‘what knowledge do I have?’”

He recalls Peter Thiel’s famous question: what important truth do very few people agree with you on?

In his book Zero to One, Thiel writes:

“The best entrepreneurs know this: Every great business is built around a secret that’s hidden from the outside. A great company is a conspiracy to change the world; when you share your secret, the recipient becomes a fellow conspirator.”

Naval adds:

“You’re only going to [have a secret] if you have an intellectual obsession—if you are obsessed with a space for some time… and you figured something out. And because you figured something out, you can bet on that with deep conviction.”

Full video: AngelList “Fireside Chat with Avlok & Naval | AngelList Confidential 2023” (Dec 2023)

P.S. We’ve put together a YouTube playlist with every Naval Ravikant insight we’ve ever shared. You can watch it here: "Best startup advice from Naval Ravikant"