Apple Revolution and Evolution — Opportunities For Changing The Playing Field: Part I

As Apple recently released its Q2 earnings and surprised the Street once again despite many skeptics, I thought it’d be interesting to go back in time and review the beginnings of this now-iconic brand. While working on this piece, Tomasz Tunguz of Redpoint Ventures wrote on his page, there’s a huge “benefit of knowing and understanding [startup] history: understanding the assumptions that led to the status quo and being able to seize the opportunity when one of those assumptions no longer holds.” [August 22, 2016 blog]

Let’s take a step back in time…It’s 1976, the year marked our country’s 200th Birthday (young by country standards). Ironically, this year also marked the birth of another start-up and revolution — Apple Computer Inc.

On April 1, 1976, with the creation of the Apple I desktop computer, three guys officially went into business. Steve Jobs sold his VW Bus and Woz sold his beloved HP programmable calculator to keep the fledgling business going and to buy parts for the Apple 1. Within weeks, the third co-founder, Ron Wayne, cashed in his stake for an $800.00 buyout from his two partners (“no regrets,” Wayne says). As it turns out, it was no April Fool’s joke. Apple Computer Inc. would go on to revolutionize not only the tech industry, but also impact many other industries, and that trend continues to this day.

For further context, in the 1960s and 1970s, to run reports and capture relevant data, it meant working with huge mainframe computers. Due to their storage capabilities, processing power and sheer robustness (physically and technically), they were for the enterprise and IT departments only, frankly it was hard to imagine them going mainstream. In fact, Naveen Jain shared a quote just this week from 1977, from leading MIT computer scientist Ken Olsen “I see no reason for individuals to have computers in their homes.” It was in that window, Apple (and IBM) entered the scene and were quickly on the heels of the mainframes with more user-friendly and “portable” computer models. It made the mainframe stalwarts and its ancillary businesses very nervous in Silicon Valley. Deals were quickly made with consolidation going on by the middle of the 1980s. It was literally changing the landscape and players of Silicon Valley.

With the release of Apple’s Macintosh in the early 1980s, it was realized that a personal computer could do similar activities of the mainframes for far less money (shout-out to Peter Diamandis on the 6 D’s of Exponential and de-monetization, and to Google for helping prove this point further in present day). On a side note, who didn’t love the Oregon Trail for Macintosh:? I digress…

A major evolution came in 1984 with Apple’s (now infamous) Super Bowl commercial featuring this latest Mac model. The commercial (a Chiat/Day ad) was literally so talked about that the Mac was flying off the shelves. True to form, it wasn’t only the commercial’s message to prevail against “big brother” and the norm, but it was clearly Apple’s stance going forward. Not even ten years after Apple’s humble beginnings back in 1976, it was the dawn of a new era that would revolutionize the tech industry, and open up new markets in and beyond The Valley.

It is interesting to reflect back on these earlier days, as it reinforces the need to “seize [new] opportunity.” Silicon Valley has its waves of boom years, and, it has its years of doomsday predictions, which have yet to truly come to fruition, unless fewer deals and lower than massive market valuations are considered absolute doom (granted, they are by some). The players change with the technology, but the stalwarts tend to remain — as long as they are aware of trends, as well as flexible. Likewise, with technology as its mainstay, the Valley has always been resilient. Thus, and perhaps, it is resilience and absolute flexibility, while never overlooking the major tech trends that are the lessons to be learned for startups and stalwarts, alike.

Please stay tuned for this Apple retrospective and perspective to continue. In my next post, I’ll turn the page to review its more recent 20 years, including the Tim Cook era, along with the Mobile revolution, where it was again a pioneer — and it again understood “to seize the opportunity.”

Needless to say all of these innovations, and innovators paved the way for where Scrimmage is going to today, and where we want to be in the days and years ahead of us. I’ll share more on this next week, and follow us @wescrimmage on social media. Also, THANKS to those who read and share these posts! Lastly, thanks and references below for the individuals referenced as sources for some great and inspiring reading…

This is Tomasz’s blog link: http://tomtunguz.com/technology-history

Naveen Jain’s post: https://www.linkedin.com/pulse/20140924143446-11514853-why-you-should-always-bet-on-dreamers-not-experts?trk=prof-post

Check out Peter’s books on Amazon: https://www.amazon.com/Peter-H.-Diamandis/e/B006392BR2