Breaking the mold with Nothing: In conversation with Nothing’s Carl Pei at Slush

EQT Ventures
Published in
7 min readMar 5, 2024

Today marks the release of Nothing’s latest Phone (2a) (see launch here), and we’re reflecting on our last conversation with co-founder and CEO, Carl Pei, which took place on a freezing cold night in Helsinki last year. Although Nothing only launched in 2021, with EQT Ventures investing in 2022, partner Ted Persson had been following Carl for some time. He first came onto his radar whilst heading up his previous venture, OnePlus. Back then, it wasn’t just that he clearly seemed ambitious, it was pretty clear he had the talent and vision to back it up.

The work that Carl and his team have carried out at Nothing has only made us more convinced of that. Over 2 million units shipped worldwide, across 37 countries is impressive — particularly for a company barely three years old.

On Slush’s main stage, Ted and Carl discussed Nothing’s origin story, thoughts on the hardware industry, as well as hands-on advice for any founders looking to break into consumer technology.

I liked what Benedict Evans said in his talk earlier about smartphones entering their “boring phase”. In a way, that’s what you’re combating with Nothing.

Carl: Exactly. When I was young, I was super excited about technology. I was a big Apple fan. I got the first iPod, the first iPhone, and the entire reason why I’m in this industry is because of the work that they did. Lately, it feels like the innovation is slowing down. It’s getting really boring.

We wanted to do something about it. And if you look at our industry, it’s so tough to break through that there’s not a single startup company apart from us. It was almost like, ‘Hey, if we don’t try then who else is going to, and the industry will remain boring for the foreseeable future.’

Let’s rewind a bit. You were here back in 2018, when you worked for OnePlus, and then you left to set up Nothing. Let’s talk a bit about that journey.

Carl: Yeah, I helped create the global side of the business, and I learned so much being part of that journey. But as the company grew, I realized I had a different vision for what the future would be like and no way to really influence that future. So in late 2020, we started Nothing.

It’s a really funny name, but, more seriously, it’s also a vision for technology. I think technology should be so seamless and easy to use that it’s not in your way anymore. It’s everywhere but nowhere. That’s long term. But in the meantime we’re making smartphones — I see some Nothing phones in the audience — and wireless audio products, with a lot more coming.

Phone (2a) is a product of daring design decisions and meticulous engineering.

You spent seven years at OnePlus, overseeing the design and marketing of its products and helping turn it into a massive success. After that, you could have done whatever you wanted — and you decided to go into the consumer electronics industry again.

Carl: I wanted to do some soul searching. I was planning a half-year vacation, because I had never really taken time off at OnePlus, but after a week I couldn’t take it anymore. So I went back to Sweden and just started raising money.

But consumer electronics is notoriously hard to crack, and plenty of startups have failed. How does Nothing set itself apart?

Carl: You have to be hyper-pragmatic in this industry. In the beginning, design is a quick way to differentiate yourself. But I think the difference between us and those who’ve tried in the last ten years is that we’re way more pragmatic. We do have a grand ambition and a vision to change the face of the tech world and how we use computers, but we also have a detailed step-by-step plan for how to get there. Not all the steps are super sexy or interesting, but they’re crucial to achieving the bigger dream.

So what do you think is coming next? And what steps do you need to take to get there?

Carl: I’ve always said that the smartphone is going to be the dominant form of computing for the foreseeable future. But now I think there’s a new computer on the horizon. I don’t know exactly what it’ll look like, but AI is going to change the world in fundamental ways. And I think one of the most important products that’s going to come out of this revolution is the new primary computer.

I’ve been thinking about how we can be part of this. One approach is to just decide right now ‘This is what it’s going to be’ and go make it. But I think that’s too high risk an approach. We want to start with building strength. We’re three years old now, and a lot stronger as a company than we were before. We want to continue building strength while exploring internally what that new form factor could be, laying out the different pieces to then be able to leverage a late mover advantage. Other teams out there will be throwing their products at the wall to see if they stick — and a lot of respect to them. But we’re going to be watching and learning from that to see what works and what doesn’t, and when we get a feeling for something that might work, we can go all in. We’re playing Go, not chess.

You doubled down on design and branding early on, but how do you think about it — then, now, and into 2024?

Carl: We’re not just building a tech product. We’re building a cult brand that people really feel they belong to.

Marketing, in a way, is all about arbitrage. It’s all about finding — at this given time and relevant to your company’s situation — what you can exploit to your advantage. We have many disadvantages as a small company. We pay more for our components, we have fewer engineers — so how can we turn these disadvantages into advantages?

One area we’ve identified is, ‘Why don’t we just become a YouTube creator?’ Big brands like Samsung cannot be very real on YouTube, but we can be. We don’t have anything to lose. So over the last year, we’ve been launching YouTube content not as a brand speaking to you, but as a native creator.

Our Phone (2) launch event wasn’t on stage, it was native YouTube content. I went to New York and asked Casey Neistat — the OG of vlogs — ‘How do you do vlogging?’ In the launch video he teaches me how to vlog and then I end up vlogging the launch of the product.

Carl vlogs the launch of Phone (2) with some help from Casey Neistat.

You’ve also done very honest reviews of other smartphone and audio products — even Nothing knock-offs.

Carl: Yeah, I wanted to know how they could sell the product that cheaply, because we can’t even build it for that price. But it was actually very bad inside.

Any tips for founders thinking about building a hardware startup?

Carl: Just don’t do it. And I’m only half-joking, because it’s very challenging and there’s very little margin for error. But if you’re going to do it, be really pragmatic about it. Don’t take too much risk.

One of the most common mistakes that people who make hardware make is overordering on the inventory. I think it’s way better to have less inventory and more demand in the market. More hardware companies have died because of ordering too much inventory rather than because of anything their competitors did.

Speaking of, you’ve done really well to get into the supply chain and get top-tier suppliers — how did you do that as such a young company?

Carl: We were just very realistic about it. You can trick suppliers with a pitch, but if they trust you and you don’t deliver on volumes, they won’t trust you again. It was extra challenging for us because a lot of people had tricked them already. You had five or six different startups making smartphones with a big vision and great founders and backers, so the factories were like, ‘Hey, we’ve heard this story so many times. We supported these companies and lost so much money — why are you different?’

We just had to deliver volume. When we built the Ear (1), our first earbuds, we knew we had to ship this volume or we wouldn’t get support from the suppliers for the next product. And now we’re in phones, we need to scale up because we’re still a tiny ant in the industry. Even if we do a million, two million a year, others are doing 100+ million a year. We’re nothing to the suppliers; they’re not going to make money on us, so we need to show them our path to becoming a 100+ million annual shipment company and actually deliver on those numbers. There’s no shortcut in the supply chain.

Last question. You were here in 2018, now again in 2023. When you’re back in another five years in 2028, where is Nothing?

Carl: Five years is a long time. Hopefully we would have taken a good stab at the next computer.