“It’s me or Steve, who do you vote for?”
Steve Jobs scanned the room at Apple’s executive committee as CEO John Sculley fired his ultimatum. Jobs saw old friends and mentors among its members, and he knew they would vote for him to take over Sculley as CEO. He was obviously the right person to lead Apple.
Apple’s key executives looked back at Jobs, and they didn’t feel as assured. For the past four years, the 30-year old wild child had run roughshod over the Macintosh division, finally delivering the Macintosh personal computer late and over budget.
Part of the problem was that Jobs had been fanatical about getting everything perfect. He paid extreme attention to the Macintosh’s design, even scrutinising the way the circuit board looked on the inside. He obsessed over the operating system’s appearance, making his staff design and re-design the title bars that appeared on top of windows and documents.
When the Macintosh shipped, it looked like Jobs’ fanaticism had paid off: the Macintosh was, indeed, revolutionary. It looked unlike any computer before it, and was the first personal computer that came with a graphical user interface and mouse. Jobs declared it “insanely great.”
But Jobs’ fervour had a downside. Jobs insisted that the Macintosh have just one floppy disk drive, and no internal hard drive, which made copying data an arduous task. Jobs didn’t want the Macintosh to have a fan, which made it prone to overheating. Thanks to the Macintosh’s various problems, sales would plummet to less than 10,000 units a month by the end of the year.
Now, just four months after the launch of the Macintosh, Jobs tried to secretly overthrow CEO John Sculley. When Sculley learned about the coup d’état, he confronted Jobs at an executive staff meeting and forced them to choose; it was either Jobs or him.
Jobs watched as one by one, the committee voted against him in favour of Sculley. They didn’t believe that Jobs, who had co-founded Apple nine years ago, could run anything without ruining everything.
“I guess I know where things stand,” Jobs choked. He ran out of the room, back to his office, and started to cry.
Days later, Sculley demoted Jobs to a figurehead role as chairman, with not a single person reporting to him. He banished Jobs to an office so far away it was nicknamed ‘Siberia’. Jobs became so depressed at one point that his colleague Susan Barnes worried he might kill himself. In September 1985, four months after his failed coup, Steve Jobs resigned from Apple.
But he didn’t leave without a plan.
Love and Loss
“It’s good to be back.”
The 3,000-strong audience cheered at Steve Jobs’ opening line. They were gathered in the Davies Symphony Hall in San Francisco, to lay eyes on what Jobs had worked on for the past three years since leaving Apple.
Before he resigned from Apple, Jobs had already decided to start over again with a new computer company. This time, instead of making mass market personal computers, his company NeXT would produce powerful workstations for academics.
This time, he would be CEO, and nobody would stop him in his quest for perfection. He would show Apple what it meant to make “insanely great” computers.
And he would show them how they had all been wrong about him.
From the start, Jobs demanded that everything at NeXT be precisely perfect: He had NeXT’s factory machines painted and repainted again to an exact shade of grey. He wanted the factory walls pure white. He required the machines specially configured to work from right to left, so it would look especially appealing to visitors.
Besides an immaculate factory, Jobs also paid master designer Paul Rand $100,000 for a single logo, delivered sight unseen with no second options. He commissioned architect I.M. Pei, who had designed the glass-and-steel pyramid for the Musée du Louvre in Paris, to create a staircase for NeXT’s office. Jobs bought luxuries like $20,000 leather chairs, and even moved the building elevator to make the office’s front entrance more impressive.
There was only one problem with all this extravagance: NeXT hadn’t even shipped a single product yet. On that October day in Symphony Hall, Jobs finally unveiled the NeXT computer, 18 months past its original launch target. It was a perfectly formed black cube that he declared “the best computer in the world.”
Like the Macintosh, the NeXT cube was beautiful, a pure geometric study in simplicity. It was also difficult and costly to manufacture. To get the perfect right angles Jobs wanted, the cube’s sides were made using premium molds in specialty shops. Jobs wanted the cube made from magnesium, which was far more expensive than plastic. Even the screws inside had lavish plating.
Because of this, the NeXT cube cost more than Jobs’ academic customers could pay. At $6,500 per computer, the price was more than double the $3,000 he’d promised them earlier.
Not only was the NeXT cube expensive, it was also lethargic. Jobs decided that the NeXT computers would use magneto-optical drives instead of hard disks, which provided far more storage than hard disks at the time. But because the drives read information from the disks slowly, the NeXT cube ran sluggishly.
The NeXT computers shipped late, in mid-1989, and tanked. NeXT’s state-of-the-art factory was designed to churn out 600 computers a day. In the end, the factory never produced more than 600 computers in a single month.
After bleeding massive amounts of cash, Jobs surrendered NeXT’s hardware division in 1993, laying off more than half his employees. Jobs’ NeXT dream was over: it looked like he would never make another insanely great computer again.
That is, until a remarkable turn of events happened to give Steve Jobs one more shot to make a dent in the universe.
A Remarkable Turn of Events
“It’s probably a totally crazy idea.”
It was December 2, 1996, and Steve Jobs was in Apple’s Cupertino office for the first time since he’d left 11 years ago. He was trying to sell NeXT to Apple, “I’ll structure any kind of deal you want — license the software, sell you the company, whatever.”
Jobs needed to make this happen. NeXT was failing, and he wanted to pay back the $120 million his investors had put into the company. Apple also needed to make this happen, it had lost nearly three-quarters of a billion dollars in the first calendar quarter alone. Apple CEO Gil Amelio was even considering filing the company for bankruptcy.
In the decade since Jobs left, Apple had lost the platform war to Microsoft and Windows, sliding to just 4% market share. A major problem was that Apple’s decrepit Macintosh System 7 OS (operating system) couldn’t compete with the more advanced Windows 95. Apple’s efforts to develop a new OS had led to failure after failure, and it needed one fast. A new OS could inject new life into Apple’s products, and give Apple a chance to turn itself around.
Steve Jobs had just what Apple needed. The NeXTStep OS was a modern OS that NeXT’s engineers had built to run on the NeXT workstations. NeXTStep was built on Unix, the same architecture underpinning Mac OS, and could run on the PowerPC processors Apple was using on their Macs.
After a round of presentations, Apple announced the deal to buy NeXT and the NeXTStep OS for $429 million. As part of the deal, Steve Jobs would return to Apple as an advisor to the company. He was going back to where it’d all started.
The Lightness of Being a Beginner Again
“The products suck! There’s no sex in them anymore!”
Steve Jobs thundered in the auditorium. He had asked Apple’s top executives to tell him what was wrong with Apple, but he didn’t wait for their answer.
It hadn’t taken long for Jobs to wrestle for control of Apple again, but this time he succeeded. Jobs orchestrated the board to fire CEO Gil Amelio, as a result, Amelio resigned just seven months after Jobs returned. Two weeks after that, Jobs forced all but two of Apple’s board of directors to resign as well. In September 1997, Jobs announced that he would take over as interim CEO of Apple, or as he liked to call it, its iCEO.
Once again, Jobs proved he was adept at getting what he wanted, consequences be damned. But what he hadn’t yet proved was that he could save Apple. Apple needed an exciting new product to make it relevant again, but Jobs’ last two major product launches had been duds. With the company close to insolvency, Apple couldn’t take another failure.
With this on his mind, Jobs returned to Apple fiercely focused. Apple had grown a bloated portfolio of products, with confusing lines of computers, printers, digital cameras. The company even made a home gaming console. Jobs got rid of 70% of these products, cut the number of R&D projects from 50 to 10, and laid off more than 2,000 employees.
“Deciding what not to do is as important as deciding what to do,” Jobs said. “That’s true for companies, and it’s true for products.” At a product strategy mission, Jobs outlined exactly what he meant by that.
He drew a chart with four quadrants, on the top of the chart, he wrote, ‘Consumer’ and ‘Pro.’ On the side of the chart, he wrote, ‘Desktop’ and ‘Portable.’ Instead of making more products, Apple would focus on making only four computers, one for each quadrant.
It was a radically sparse strategy, especially when the perceived wisdom was to create as large a portfolio of products as possible, to capture the highest market share possible. But Jobs’ tight focus worked, it gave Apple’s staff a clear direction and galvanised them to target their efforts in four sharply defined areas.
One of the people Jobs inspired was Apple’s head of design, Jonathan Ive. Jobs wanted to launch a new consumer desktop personal computer the next year, and it had to be special. Ive showed Jobs a dozen foam prototypes for the new computer, but none of them caught his eye — except one.
This prototype was round and playful, and didn’t look like any computer that’d been made. “It has a sense that it’s just arrived on your desktop or it’s just about to hop off and go somewhere,” Ive told Jobs.
Ive proposed a translucent, sea-green, plastic casing for the new computer, which would later be named Bondi Blue, after the colour of the water at Bondi Beach in Sydney, Australia. To make it work, Ive and his team even visited a jelly bean factory, to study how to make translucent colours look appealing.
Jobs fell in love with the design. He carried the prototype around Apple’s campus, raving about it to trusted executives.
Jobs worked on the new computer’s internals with Apple’s chief of hardware Jon Rubinstein. They decided not to include a floppy disk drive in the new machine, despite the fact that people were still using floppy disks at the time. Instead, the new computer would only have a CD tray. Just like he did with the NeXT cube’s magneto-optical drive, Jobs made a bet on new technology. In this case, he was right; computers eventually phased out floppy disks in the next few years.
But that CD tray would almost derail the computer’s launch. At the launch rehearsal, Jobs saw the completed prototype for the first time. The CD tray had a button on the front, under the display, to push the tray in and out. Jobs saw it and went ballistic, screaming, “What the fuck is this?!”
Rubinstein insisted that he’d previously shown Jobs this exact drive, but Jobs was adamant that the earlier version only had a slot without any buttons. Jobs furiously suspended the rehearsal. It looked like Jobs might just cancel the launch, because he couldn’t get his new computer precisely perfect.
Finally, Jobs turned to Rubinstein in tears and said, “I’m only going to go ahead with the launch if you promise me we’re going to go to slot mode as soon as possible.”
On May 6, 1998, Jobs presented Apple’s new personal computer, the iMac, to the world. Like the Macintosh and the NeXT cube before it, the iMac was a revolution. Compared to the beige boxes being sold at the time, the iMac was colourful, organic and friendly. It looked less like an inscrutable piece of technology, and more like a device anybody could use.
Unlike the Macintosh and NeXT cube, the iMac was a smash hit at launch, selling nearly two million units in its first year. It brought Apple back from the brink of extinction, and proved that Apple and Steve Jobs could once again make “insanely great” computers. Two years later, Jobs would drop the ‘i’ in his title and officially become Apple’s CEO.
Steve Jobs was home again, and in the 14 years of his return to Apple, he would never look back.
Afterword: Connecting the Dots
After the release of the iMac, Steve Jobs led Apple to greater and greater heights. Under his tenure, Apple introduced three products, which I can honestly say without hyperbole, changed the world: the iPod in 2001, the iPhone in 2007, and the iPad in 2010.
Those products also changed Apple. In 1997, when Jobs returned to Apple, the company reported a loss of $1 billion. In 2011, when Jobs resigned as CEO, Apple was making $108 billion.
This is the Steve Jobs that most would probably remember, the incredibly successful genius, billionaire, visionary, asshole. But most might not remember that Jobs suffered through two very public failures, and was even once considered a has-been.
So, how did Jobs make his remarkable comeback? How did he transform failure into success, and deliver one of the greatest second acts of all time?
The answer is complicated, especially when you consider that Steve Jobs’ comeback story is also the story of Apple’s resurrection. While Jobs was the centre that held everyone together, Apple’s rejuvenation was the result of a group — not solo — effort. But there are lessons we can still gleam from Jobs’ personal story about how to start over.
While Steve Jobs is a more comprehensive read, Becoming Steve Jobs delves deeper into Jobs’ psychology, and explains how Jobs changed in the years he was exiled from Apple, and eventually returned a wiser and more mature leader. Becoming Steve Jobs offers a tapestry of reasons how Jobs weaved success out of failure, and is a great read.
If I had to pull a single thread out of this weave to focus on, I’d say that Jobs seemed to be a remarkably forward-focused person. When Jobs was demoted to the figurehead role of Chairman in 1985, he was truly depressed. But it didn’t take him too long to focus on what he would do next.
When Jobs resigned from Apple, he already knew his next target market, had an idea of what he would build, and had corralled a number of key Apple employees to leave with him.
“What’s the point in looking back,” he told me in one email. “I’d rather look forward to all the good things to come.”Brent Schlender and Rick Tetzeli, Becoming Steve Jobs
It wasn’t ever like ‘Oh, you screwed up.’ It was ‘What are we gonna do to move forward?’ The past can be a lesson, but the past is gone. He believed that.Edwin Catmull, Becoming Steve Jobs
Let’s go invent tomorrow rather than worrying about what happened yesterday.Steve Jobs, D5 Conference: All Things Digital
Years later, when Jobs returned to Apple as an advisor, he faced an incredibly daunting prospect. He could either try to turn around a rapidly dying company — a Herculean task that would have worried any of the world’s best CEOs — or wash his hands of the entire mess, walk away a rich man, and enjoy retirement with his family.
In fact, Jobs was already a billionaire by this time. To keep this post more concise, I’ve left out a significant chunk of Jobs’ “wilderness years,” which included his time at both NeXT and Pixar. After Jobs left Apple, he bought the fledging Pixar, shepherded it through tough times, and led it to huge success with the release of its first movie Toy Story. From Pixar’s IPO, Jobs became far richer than he’d even been at Apple.
Jobs didn’t need the money anymore. But he chose to do the harder task of rescuing Apple.
I watched Bob Dylan as I was growing up, and I watched him never stand still … If you look at true artists, if they get really good at something, it occurs to them that they can do this for the rest of their lives, and they can be really successful at it to the outside world, but not really successful to themselves. That’s the moment that an artist really decides who he or she is. If they keep on risking failure they’re still artists. Dylan and Picasso were always risking failure.
This Apple thing is that way for me. I don’t want to fail, of course. When I was going in I didn’t know how bad it really was, but I still had a lot to think about. I had to consider the implications for Pixar, and for my family, and for my reputation, and all sorts of things. And I finally decided, I don’t really care, this is what I want to do. And if I try my best and fail, well, I tried my best.Steve Jobs, Becoming Steve Jobs
Jobs was a man who was remarkably unafraid about starting over. He started over multiple times, from NeXT, to Apple 2.0, and even on the iPhone:
We had a different enclosure design for this iPhone until way too close to the introduction to ever change it. And I came in one Monday morning, I said, ‘I just don’t love this. I can’t convince myself to fall in love with this. And this is the most important product we’ve ever done.’ And we pushed the reset button. We went through all of the zillions of models we’d made and ideas we’d had. And we ended up creating what you see here as the iPhone, which is dramatically better. It was hell because we had to go to the team and say, ‘All this work you’ve (done) for the last year, we’re going to have to throw it away and start over, and we’re going to have to work twice as hard now because we don’t have enough time.’ … That happens more than you think, because this is not just engineering and science. There is art, too.Steve Jobs, Fortune
It was probably a combination of his focus on the future, and willingness to start all over again, that helped him to see worlds of possibility, to see what could be instead of what had been. Jobs carried many strengths that enabled him to start over, and I believe this was one of them.
It is hard enough to see what is already there, to remove the many impediments to a clear view of reality, but Steve’s gift was even greater: he saw clearly what was not there, what could be there, what had to be there. His mind was never a captive of reality. Quite the contrary. He imagined what reality lacked, and he set out to remedy it. His ideas were not arguments but intuitions, born of a true inner freedom. For this reason, he possessed an uncannily large sense of possibility — an epic sense of possibility.Laurene Powell Jobs, Becoming Steve Jobs
Featured image of Steve Jobs by Ben Stanfield. Licensed under CC BY-SA 2.0.