On August 2, 2018, Apple made history by becoming the world’s first $1 trillion company. (To read more, see: Apple is a $1 Trillion Company. Now What?)
Here's the story of how the company was built and the man central to its founding and growth.
In October 2011, Steve Jobs passed away at the age of 56. He had just left the CEO post at Apple, the company he cofounded, for the second time. Jobs was an entrepreneur through and through, and the story of his rise is the story of Apple as a company, along with some very interesting twists. In this article, we'll look at the career of Steve Jobs and the company he founded, as well as some of the lessons there are for potential entrepreneurs. Critics doubted Apple's ability to keep up its level of constant innovation and its status as a groundbreaking company following Jobs' departure. Becoming the first $1T company is in no small part connected to the legacy and lessons learned from Steve Jobs.
From Blue Boxes to Apple
Steve Jobs got his start in business with another Steve, Steve Wozniak, building the blue boxes phone phreakers used to make free calls across the nation. The two were members of the HomeBrew Computer Club, where they quickly became enamored with kit computers, and left the blue boxes behind. The next product the two sold was the Apple I. It was a kit for building a PC, which the customer needed to add a monitor and keyboard to in order to do anything with it.
With Wozniak doing most of the building and Jobs handling the sales, the two made enough money off the hobbyist market to invest in the Apple II. It was the Apple II that made the company. Jobs and Wozniak created enough interest in their new product to attract venture capital. This meant they were in the big leagues and their company, Apple, was officially incorporated in 1977. Steve Jobs was a month shy of turning 22 and would be a millionaire before his next birthday. (For related reading, see: Steve Jobs: Legacy Of A Tech Guru.)
The Roller Coaster Ride Begins
By 1978, Apple was making $2 million in profits solely on the strength of the Apple II. The Apple II wasn't state of the art, but it did allow computer enthusiasts to create and sell their own programs. Among these user-generated programs was VisiCalc, a type of proto-Excel that represented the first software with business applications. Although Apple did not profit directly from these programs, they did see more interest as the uses for the Apple II broadened. This model of allowing users to create their own programs and sell them would reappear in the app market of the future, but with a much tighter business strategy around it.
By the time Apple went public in 1980, the dynamic of the company was more or less set. Steve Jobs was the fiery visionary, with an intense and often combative management style, and Steve Wozniak was the quiet genius who made the vision work. Apple's board wasn't too fond of such a power imbalance in the company, however. Jobs and the board agreed to add John Sculley to the executive team in 1983. In 1985, the board ousted Jobs in favor of Sculley.
The Gap Years
Steve Jobs was rich and unemployed. Although he wasn't working at Apple, he was far from idle. During this time, from 1985 to 1996, Jobs was involved in two big deals; the first of which was an investment. In 1986, Jobs purchased a controlling stake in a company called Pixar from George Lucas. The company was struggling, but their eventual success in digital animation led to an initial public offering (IPO) that earned Jobs around $1 billion. (For related reading, see: How an IPO Is Valued.)
The second was a return to his old obsession with computers, founding NeXT to create high-end computers. These were expensive machines with an operating system representing the best attempt yet at making the power of UNIX fit into a graphical user interface. When Tim Berners-Lee created the World Wide Web, he did so using a NeXT machine.
Of these two deals, NeXT proved the most important, as it turned out Apple was looking to replace its operating system. Apple bought NeXT in 1996 for its operating system, bringing Steve Jobs back to the first company he founded.
Getting Apple Back on Track
When Jobs returned, the company wasn't in a very good condition. Apple had begun to flounder as cheap PCs running Windows flooded the market. Jobs found himself in the driver's seat again and took some drastic steps to turn around Apple's decline. The company asked for, and received, a $150 million investment from Bill Gates. Jobs used the money to ramp up advertising and highlight the products Apple already offered, while choking off R&D money in non-producing areas.
The NeXT operating system was used to create the iMac, Apple's first hit PC in a long time. Jobs followed this up with a list of successes from the iPod in 2001 to the iPad in 2010. The years between saw Apple dominate the smartphone market with the iPhone, open up an e-commerce store with iTunes and launch branded retail outlets called, what else, the Apple Store. When Jobs stepped down as CEO, Apple was scrapping with Exxon for the world's largest market cap. (For related reading, see: The Power Of Steve Jobs.)
The Bottom Line
It's impossible to sum up Jobs' career in a single article, but a few lessons stick out. First, innovation counts for a lot, but innovative products fail without proper marketing. Second, there are no straight paths to success. Jobs did get wealthy very early on, but he would be a footnote today if he didn't return to Apple in the 90s. At one point, Jobs was kicked out of the company he helped create for being hard to work with. Rather than change, he bided his time, then took over again, and this time his attitude was seen as part of his genius.
There is much more to be learned from the life of Steve Jobs, as there is in the life of every successful entrepreneur. The sheer hubris of the entrepreneurial spirit, the idea you can do something bigger and better than it has ever been done before, always bears watching and studying, whether to imitate it or just to marvel at what that hubris can create. (For related reading, see: What Can We Learn From Steve Jobs.)