Apple Computer, now known simply as Apple Inc., is one of history‘s most improbable business success stories. The world‘s first trillion-dollar company revolutionized personal computing, digital music players, smartphones, tablets, smart watches and has expanded into streaming video/music services and beyond. As experts project Apple‘s rapid growth to continue over the coming years, we take an in-depth look at the two ingenious founders behind the world‘s most valuable brand – Steve Jobs and Steve Wozniak.
From Phone Phreakers to Tech Pioneers: The Early Days
Long before starting Apple and becoming business legends, Steve Jobs and Steve Wozniak were just two ambitious teenagers in Silicon Valley with a deep passion for electronics and computers in 1971. The two men vastly differed in personality, but shared a unique talent for innovation.
Jobs and Wozniak first met through a mutual friend, Bill Fernandez, who shared their interest in electronics. According to Isaacson‘s biography, the two Steves bonded over pulling elaborate pranks and building Blue Boxes – devices that exploited telephones to make free long-distance calls by emitting certain pitch frequencies. Wozniak handled building the pioneering tech, while Jobs took charge of marketing and sales to fellow students. This homebrew Blue Box project foreshadowed the pairing of Wozniak‘s engineering genius with Jobs‘ business savvy just a few years later.
Turning a Homebrew Computer Kit into a Breakthrough Product
Steve Wozniak began designing his own computer system in 1975 after reading an article about the Altair 8800 microcomputer kit in Popular Electronics magazine. Staying up through the night, he devised a superior version of the Altair without ever having seen it, using a similar central processing chip. When he showed his friend Steve Jobs the drawings and plans, they decided to start their own computer company. After selling personal possessions for startup capital, they founded Apple Computer on April 1, 1976.
Wozniak‘s first computer design would become the Apple I. Priced at $666.66, this basic motherboard with no case, power supply or keyboard, showed what a complete microcomputer could potentially look like in the future using his cost-reduced designs. Though an early prototype, it demonstrated enough commercial promise to secure funding from investor Mike Markkula just a year later. This facilitated moving from Jobs‘ family garage to an office in Cupertino, California to develop Apple‘s follow up product.
The Apple II, introduced in 1977, proved to be their breakthrough product – packaging Wozniak‘s user-friendly hardware with software in an all-in-one PC with a plastic case and color graphics. Considered one of the first true personal computers, the Apple II found popularity with home users, small businesses, and even classrooms. The runaway success of Apple II sales fueled incredible early revenue growth, establishing Apple Computer as an industry player.
The Departure of the Third Founding Member Sets Stage for Future Conflict
While most associate Apple‘s origin story with Jobs and Wozniak, the partnership originally included a third founder during the company‘s pre-incorporation phase – Ronald Wayne. Serving as somewhat of a mediator between Steve‘s contrasting personalities, he also drafted Apple‘s first logo and documentation. Worried about potential financial risk, Wayne decided to relinquish ties just 12 days after co-founding Apple by selling his 10% stake for just $800. He now regrets this decision as his shares would be valued today north of $300 billion!
With Wayne relinquishing his role so early on, Apple Computer operated without a balanced leadership dynamic between the two founders. Almost from the start, Steve Jobs asserted himself as the boss of the operation rather than a peer partner with Wozniak. This created an imbalance that led to power struggles and rifts over the coming decade. Nonetheless, it was the intrinsic motivations of its two ingenious remaining founders that propelled Apple‘s meteoric rise through sheer innovation.
Clash of Leadership Direction Results in Jobs Being Ousted from His Company
Behind the scenes, power struggles and internal leadership conflicts long brewed between Steve Jobs and John Sculley. As Apple CEO since 1983, Sculley was brought in from Pepsi by Jobs himself to provide business experience. But over time, tension arose as Sculley aimed to rein in Jobs‘ perfectionist tendencies which caused product launch delays. The board sided with Sculley as Apple success climbed, resulting in Jobs being stripped of duties and resigning in 1985.
This caused Jobs to sell all but one share of his Apple stock and instead pour focus into his new venture – NeXT Computer Inc. Their aim was building advanced workstation PCs for education and business markets. Simultaneously, Jobs purchased acclaimed visual effects company Pixar from George Lucas in 1986 which specialized in computer animation. He navigated Pixar into position as an industry leader through films like Toy Story, though they struggled with profitability initially.
Meanwhile at Apple in the 1990‘s, the company began losing direction and market share under Sculley‘s appointed successors. With their aging operating system falling desperately behind and lackluster consumer products, they struggled turning out hit releases. Apple acquired several companies attempting to revitalize – but none could replicate Jobs‘ design brilliance. This downward spiral would open the door for Jobs‘ phoenix-like return.
Jobs Leverages Lessons from his Successes at NeXT and Pixar for Apple‘s Second Act
By early 1997, Apple Computer was on the brink of bankruptcy. Then-CEO Gil Amelio began acquisition talks with Steve Jobs‘ much smaller NeXT Computer Inc. which had been seeing success with its advanced NeXTSTEP operating system and slick magnesium computers. Apple ended up acquiring the company in a $400 million deal that year.
From Pixar, Jobs learned the immense value of compelling storytelling to captivate audiences. He applied this creative marketing approach to develop Apple‘s brand identity of being a creative force for revolutionizing technology to empower lifestyle pursuits like music and movies. Pixar also drove lessons in building a collaborative corporate culture which empowered talent.
As part of the NeXT acquisition, Jobs returned to leadership at the company he co-founded but previously forced out from. Engineer Avie Tevanian ported NeXT‘s operating system to work on Apple Mac hardware, which updated the Mac‘s outdated software foundations. The following year, Jobs introduced the first iMac personal computer which captured mainstream consumer attention by focusing on internet and design. This bouncing back also came from clear lessons learned through Jobs‘ struggles to sharply define NeXT‘s products.
Revolutionizing Consumer Electronics Through a String of Hit Products
The initial success of the iMac in 1998 was just the beginning of Apple‘s furious comeback under Steve Jobs focused vision. The company churned out revolutionary consumer products over the next decade leveraging cutting edge industrial design and human-focused interfaces. This includes the 2001 iPod portable digital music player, 2007 iPhone touchscreen smartphone, 2010 iPad tablet computer and beyond.
For example, the iPod‘s click wheel and software allowed Importing entire music libraries to a palm-sized device. Likewise, the visual iPhone software made mobile internet user-friendly when competitors focused on physical keypads. The Western world shifted from albums and flip phones almost overnight. Likewise, the 2010 iPad realized the potential of slick multi-touch tablet computing as an on-the-go entertainment device.
Each product intelligently focused the digital age into understandable, enjoyable human experiences through elegant design. This made Apple products veritable status symbols and allowed the stock price to skyrocket by over 33,000% since 1990 based on excitement over this string of hits.
Meanwhile in leadership, Tim Cook steadily grew through the executive ranks under Steve Jobs before being named Chief Operating Officer in 2005. Considered a supply chain genius for doubling Apple margins, he oversaw worldwide operations and sales like opening Apple Stores globally until Jobs‘ ailing health led Cook to assume CEO duties by August 2011. He doubled down on Apple services like iTunes, App Store and subscriptions in later years.
While lacking Jobs‘ sheer creative vision, Cook expanded Apple‘s programs in renewable energy, employee equity and accessibility. This balanced Jobs‘ long-time stance against philanthropy. He additionally navigated geopolitical challenges as Apple‘s global reach expanded. Though different from Jobs, Cook maintained Apple‘s cultural identity. Critics initially worried innovation would stall, but Apple Watch, AirPods, Apple Card and Vision/Reality work suggest otherwise as Cook enters his 12th year as CEO targeting new frontiers like autonomous electric vehicles.
By the Numbers: Apple‘s Journey to a $2.5 Trillion Valuation
Launched from a California garage in 1976, Apple is certainly no longer a startup. Today, Apple employs over 160,000 workers in the USA alone who help design, engineer, manufacture, program and sell electronics changing how we work and play. For perspective on Apple‘s gargantuan size today:
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Apple earned over $394 billion in their 2022 fiscal year ending September 24, 2022. This staggering sum is nearly $1.1 billion per day.
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As of August 2022, Apple passed Saudi Aramco to become the world‘s most valuable company at over $2.5 trillion in market capitalization
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According to Above Avalon, Apple captured over 36% of global smartphone revenue and 40% of smartphone industry profits
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Apple owns 81% share of tablets over $200 in America and 73% in China showing dominance
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900 million paying subscribers use Apple services like Apple Music, iCloud and AppleCare warranties
This behemoth success would have been unimaginable when Ronald Wayne originally drafted the first Apple partnership contract. Apple is now 30,000 times as large as 46 years earlier. With strong iPhone 14 sales and new devices slated for 2023 like the mixed-reality headset, rapid expansion looks to carry onward as today‘s most iconic brand.
Setbacks and Stumbles: Examining Apple‘s Biggest Failures
In retrospect, Apple‘s meteoric rise seemed almost fated considering their ubiquitous iPhones today. However, Apple likely wouldn‘t be the $3 trillion titan we know without learning important lessons by weathering various setbacks and product failures over the decades.
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The Apple III computer aimed to build on their successful II series, but faced engineering flaws like overheating and even melting motherboards.
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The 1996 PowerMac G4 Cube, while an engineering marvel, saw dismal sales from a questionable $1,800 sticker price for a tiny performance PC with limited expandability.
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Steve Jobs pitched the PowerMac G4 with radical Features like a liquid cooled processor and PCA integrating a full computer into a monitor base. But this runs counter to later simplicity values.
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Steve Jobs envisioned Apple touch screen tablets long before iPad, but the early 1990s Apple Newton fizzled with iffy handwriting recognition before the technology matured.
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In services, Apple aimed to be the Netflix of video games with 2014‘s Apple Arcade subscription – but faced stiff competition from console platforms and Steam.
Through each misstep, Apple learned lessons regarding pricing, marketing, technology limitations or optimal user experience. This prepared them for later homeruns. Likewise, Apple Music overcame early iTunes Radio troubles. Even as the world‘s most valuable company, Apple still sees experimental services like Apple News falter as not every new product resonates. But taking calculated risks has long spurred Apple ahead regardless.
What‘s Next for Apple: Evaluating Emerging Technologies
As much as Apple already transformed mobile phones, personal computing, digital music and more in just the past 20 years, they continually set sights on the next frontier. Rumors whirl regarding an augmented/virtual reality headset dubbing Apple‘s next "Next Big Thing". This could revolutionize everything from mobile gaming to facilitating remote collaboration.
Additionally, experts believe Apple plans vegetation deep into building autonomous electric vehicles. Breaking into auto manufacturing would be a tall order given massive barriers to entry and regulations. Then again, critics similarly doubted Apple could ever compete in crowded fields like smartphones and smart watches before they redefined those landscapes completely through revolutionary design. If any company has potential to re-envision transportation as seamlessly as they did music players, it may just be Apple.
Between Constant software updates advancing iPhone, iPad and Mac beyond the competition, major new product categories rumored biannually and Apple‘s $200 billion cash stockpile for investments or acquisitions, it seems Apple is still just getting started – 45 years later! Steve Jobs would undoubtedly be gobsmacked seeing Apple grow over 300,000% from its origins building motherboards in a garage into the wealthiest enterprise on Earth. But then again, given Jobs and Wozniak‘s history-making vision, he may have expected this astronomical rise all along from those earliest days as friends designing blue boxes.
