innovator_mindset

Is it possible an innovation based on a feeling? Unfortunately for Steve Jobs – not. At the time of creating GUI, it was almost impossible to patent an innovation that looked and felt like interacting with a computer. It was the primary reason for the dispute between Bill Gates and Steve Jobs. In 1983, just before the launch of the Macintosh, Microsoft announced that they were developing Windows and, most importantly, relying on a graphical interface. Jobs was furious and called Gates a plagiarist.

And although from the point of view of the law Gates was right, but not from the aesthetic point of view. You can understand Jobs's anger because Apple's solution was innovative, creative, more sophisticated, and more ingenious in terms of design.

Interestingly, Jobs considered Microsoft's success as an aesthetic defect in the functioning of the universe.

What then ensured Windows world domination? As we have already understood - clearly not design. The answer is the business model.

The main reason for success is the willingness and desire to give the right to use your OS to any hardware manufacturer.

Now let's look at Apple's approach. They followed an integrated approach. That is, their hardware was supplied only complete with software. This is again a reflection of Jobs' obsession with controlling everything personally and managing the user's experiences from start to finish.

Therefore, what were the implications of these two different approaches? Apple's approach has led to better products, greater profitability, and more refined user experiences. Microsoft's approach has led to a wider choice of hardware and proved to be the best way to gain market share.

Product is what matters, not pitching
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For any venture investor, the most important thing is to choose the right startup. So, what are venture investors guided by when making this decision?

Marc Andreessen, the founder of Mosaic, became a venture capitalist after its creation. For example, he preferred startups, whose founders focused on creating a quality product and customer service, rather than on schedules and presentations.

"They will be the first to become companies worth trillions of dollars."

Nowadays there are tons of information on how to present your product. Just google and you’ll see half a billion pages on this topic. “How to write a winning pitch”. “How to nail your sales presentation”. “7 Sales Pitch Examples Too Good to Ignore” and so on. No doubt pitching is an essential skill – not only for product presentation but truly for anything! We live during the time when even kids in the kindergarten learn how to pitch. However, no matter how useful it is when it comes to successful business the presentation part fades into the background.

To illustrate the point take an important event in the technological era – the finding of Google. In 1998 Larry Page and Sergey Brin met with the first investor and presented their search engine, which was not like the others. Andy Bechtolsheim received dozens of applications each week. Though unlike others this was something quite different – real. It was not a PowerPoint presentation about some hypothetical software that didn't yet exist. He could enter queries himself and instantly see on the screen the results, moreover, much better than those already existing at the time.

Andy liked that they didn't waste a lot of money on marketing. They spent more money on computer components that they assembled themselves. As he recalled:

“Other websites have spent a significant amount of venture capital on advertising. Here the approach was the opposite. Create something valuable and present an attractive service so that people just take it and use it”.

Interestingly, Jeff Bezos was also among the investors. As he said: "They had a vision. That was a customer-oriented point of view”.

Rebellion – innovator's defining feature
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The driving force of innovation is people who have both good theories and the opportunity to be part of a group that can put them into practice.

Social forces promote the progress and formation of innovations, which in this case bear the imprint of the cultural environment in which they were born.

A trait of many technological innovators is disobedience.

Like many innovators, Bill Gates was rebellious just for the hell of it. After completing his first year at Harvard, he persuaded his partner Paul Allen to drop out to start their own company. However, his parents demanded that he continue his studies.

He relented but decided not to attend any of the classes he enrolled in, and to attend lectures only on those subjects he did not enroll in. He followed this rule very carefully.

"By my sophomore year, I was auditing classes that met at the same time as my actual classes just to make sure I’d never make a mistake. So I was this complete rejectionist"

He had another trait of innovator: he was a rebel with little respect for authority.

Larry Page and Sergei Brin were also famous for their impudence. According to their academic advisor “They didn't have this false respect for authority. They were challenging me all the time. They had no compunction in saying to me: "You're full of crap!"

For most of the 20th century, new companies were mostly funded by a small group of wealthy families (such as the Rockefellers).

After World War II, many of these clans set up firms to institutionalize their businesses.

Example №1: J. Whitney created J. H. Whitney & Co. (1946), which specialized in "venture capital" (as they first called it) - financing entrepreneurs with interesting ideas who could not take a loan from a bank.

Example №2: The Rockefeller Children founded Venrock Associates (1946).

Example №3: G. Doriot, former dean of the Harvard Business School, and K. Compton, former president of MIT, founded ARDC. The basis was not family wealth, but business acumen.

However, these firms were on the east coast. Arthur Rock spread the concept to the west. Thus, began the era of venture capital in Silicon Valley.

Arthur Rock brought together the "Traitorous Eight" with Fairchild Camera. He and his firm secured a share of the new company's profits in the deal. After that, he realized that he could attract funding without the involvement of corporate bosses. He had market research experience, a love of technology, an intuitive sense and leadership in business, and a group of investors behind him.

Arthur Rock: "The money was on the East Coast, but the companies I was fond of were in California, so I went west knowing I could put it together."

Interestingly, when Noyce and Moore decided to start a company, they didn't even need a business plan. They just scribbled a description of what they were going to produce. And this description took no more than half a page.

Arthur Rock: "It was my only investment, the success of which I was 100% sure."

1976. Steve Jobs demonstrates the first Apple I Computer at Homebrew Computer Club. After the demonstration, Paul Terrell, the owner of the computer shop Byte Shop ordered 50 of Apple I.

However, there was something that had not happened before. He agreed to order them but wanted to get them fully assembled, not just printed boards with a pile of components.

It sounds strange, but this was the next step in the evolution of the PC. Until then, they have been the subject of interest only for craftsmen. Those like Steve Wozniak.

However, the trend began to change and Steve Jobs, having a flair for such things, caught it. When it came time to build the Apple II he did something quite unordinary. He went to Macy’s and studied the Cuisinart. He decided that the next PC should be like an appliance. That is, no assembly should be required. Everything should be tightly integrated - from the power supply to the software, from the keyboard to the monitor.

"We were no longer aiming for the handful of hobbyists who liked to assemble their own computers and knew how to buy transformers and keyboards. For every one of them, there were a thousand people who would want the machine to be ready to run"

The rise of Apple marked the decline of hobbyist culture. DIY kits, being so popular among young innovators for decades withered away. Hardware hackers such as Steve Wozniak ceded primacy to software coders such as Bill Gates.