There are, in my mind, probably only two broad categories in the entire history of the last two hundred and fifty years where people actually came up with new things and made money doing so. One is these sort of vertically integrated complex monopolies which people did build in the second industrial revolution at the end of the nineteenth and start of the twentieth century. This is like Ford, it was the vertically integrated oil companies like Standard Oil, and what these vertically integrated monopolies typically required was a very complex coordination, you've got a lot of pieces to fit together in just the right way, and when you assemble that you had a tremendous advantage. This is actually done surprisingly little today and so I think this is sort of a business form that when people can pull it off, is very valuable.
It's typically fairly capital intensive, we live in a culture where it's very hard to get people to buy into anything that's super complicated and takes very long to build. When I think of my colleague and friend Elon from PayPal success with Tesla and SpaceX, I think the key to these companies was the complex vertically integrated monopoly structure they had. If you look at Tesla or SpaceX and you ask, was there sort of a single breakthrough, I mean they certainly innovated on a law of dimensions, but I don't think there was a single 10X breakthrough on battery storage, they may be working on some things in rocketry, but there was no sort of single massive breakthrough. But what was really impressive was integrating all these pieces together and doing it in a way that was more vertically integrated than most other competitors.
So Tesla also integrated the car distributors so they wouldn't steal all the money as has happened with the rest of the car industry in the US. Or SpaceX, basically, you pulled in all subcontractors where most of the large aerospace companies have single sourced subcontractors that are able to charge monopoly profits and make it very hard for the integrated aerospace companies to make money. And so vertical integration I think is sort of a very under explored modality of technological progress that people would do well to look at more.