Category Archives: Strategy

Key takeaways from Steve Jobs’ life based on Walter Isaacson’s biography

This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.

Location Really Does Matter For Entrepreneurs:

You need to be in the right place at the right time. Being exposed to many ideas, variables, and potential inputs for accidental discoveries is better than living in a risk averse environment. In High School, Jobs took an electronics class which would have been less likely in most other cities in the US or Canada. Steve Jobs was fortunate to be raised in Silicon Valley, and because of that location it is less of a mystery as to why Jobs is who he was. Defense contracts in Silicon Valley during the 1950s shaped the history of the valley, military investment was used to build cameras to fly over the USSR, for example. Military companies were on the cutting edge, and made living in Silicon Valley interesting. In the 1930s, Dave Packard moved into Silicon Valley, and his garage was the core of the creation of Hewlett Packard. In the 1960s, HP had 9,000 employees, and it was where all engineers wanted to work. Jobs was ambitious enough at a young age to phone Dave Packard and ask for some parts. That’s how he got a summer job there. Moore’s Law emerged in Silicon Valley, Intel was able to develop the first micro processor. Financial backing was made easier to acquire where rich New Yorker’s retired to…By having the chip technology that could be cost measured for projections, Jobs and Gates would use this metric to revolutionize the technological world.

 

Childhood Shapes Your Thinking:

Jobs was never interested in cars, but he wanted to hang out with his dad, who emphasized the importance of building quality products, and loved souping up cars. The interior of a product is equally important as the exterior for Paul Jobs (Steve’s Father). Eichler Homes were great designs, with a simple capability that was common in Silicon Valley. Paul also taught that you should know more than the person you bargain with. Paul Jobs could not successfully get into real-estate because he was unwilling to sell, and be like-able. By his teens, Jobs realized he was smarter than his parents.  Steve Jobs was willful, and his parents would go to great lengths to feed Jobs every whim by deferring to his needs. Steve Jobs got into a fight with his dad for smoking marijuana, but by his senior year, Jobs was looking into sleep deprivation, LSD, and other drugs.

Jobs was fascinated by the need for perfection in technology. Later on in the 1980s, he argued that even if you can’t see something, it should be done well. Jobs wanted to ensure that the Macintosh mother board was beautiful, so he had members of his team sign the circuit board. Steve Jobs became more interested in electronics than in car engineering, in particular the laser technology his father was working at Spectra Physics.

 

Go Get What You Want, If You Have The Courage:

The 9100A was the first desktop computer, it was a huge computer that Jobs saw in the Explorers Club he participated in. Jobs created a frequency counter as part of the club, but he needed a special part so he phoned the home of the CEO of HP, and spoke with Hewlett directly over the phone for over 20 minutes. This conversation got Jobs a summer position at HP. Jobs had pushed his way into the factory. Steve Jobs hung out with the engineers mostly, but he worked in the electronic components section of HP.

Steve Jobs walked into the lobby of Atari in sandals, and demanded that he work as one of the first 50 people for Atari at $5 an hour. Jobs was very intelligent, and excited about technology. Nolan Bushnell used the power of his personality to build Atari, and Steve Jobs learned about this skill in part from Bushnell. Steve was a prickly person, and he had horrible body odor. Steve Jobs was brash, and, at Atari, told many of his co-workers that they were “dumb shits.” Atari didn’t mind his horrible BO because Jobs was agressive, smart, and worked hard. However, Jobs was put on the night-shift at Atari so that no-one had to deal with him during regular work hours.

 

Education Is For Conformists:

Steve Jobs was not interested in memorizing information but being stimulated. He was sent home repeatedly. Jobs began to excel when he was incentivised by his game-changing teacher Imogen Hill “Teddy” who bribed Jobs into doing Math problems in exchange for lollipops. She further invested in Jobs with cameras and other toys. Steve Jobs was able to convince another kid to give him her Hawaii shirt for a school photo, he knew how to convince others to do things for him early on. Steve Jobs was put forward by one grade for his brilliance. He was not a straight-edged student however.

Assume That You Will Die Young:

Jobs believed that he was going to die young. He worked extremely hard because he was certain that he would be dead at an early age.

The Cream Soda Computer:

Wozniak was able to build a calculator that displayed binary code while drinking cream soda extensively in 1973. Wozniak’s great strength was that he was emotionally and socially inexperienced, was a high school geek who cared more about computers. Wozniak knew more electronics than Steve Jobs, and Jobs was more mature, so they met in the middle. Wozniak and Jobs both listened to Bob Dylan. Dylan’s words struck chords of creative thinking for Woz and Jobs. They bootlegged many Bob Dylan concerts. They even worked as entertainers in Silicon Valley dressing up as clowns to perform for kids.

 

Go To India:

Steve Jobs went to India to expand his meditation skills. Jobs sought spiritual calm but he could not get into his own inner calm in Silicon Valley. He spent 7 months in India being mentored in meditation. Jobs found a spiritual leader in Silicon Valley in Los Altos. Steve Jobs would do meditations, they learned how to tune out distractions. His friends noticed that Jobs became self-important. Steve Jobs also engaged in primal screaming which helped to resolve his childhood pain. Jobs appreciated intuitive spirituality, he wanted to grow in that way. You need to avoid getting stuck in thought patterns that are really just chemical patterns in your brain. By age 30, many people cannot escape their own grooves. You need to be able to throw yourselves out, according to Jobs. Artists go and hibernate somewhere. To be truly innovative over time, you need to think outside of the box, and escape yourself.

 

Pranking People Requires Creative Thinking:

Steve Jobs and Wozniak produced a banner with a hug hand flipping the middle finger to all the seniors as the graduating classes marched past during a High School pep rally. This got Steve Jobs suspended. Steve Jobs was interested in pranking his classmates, and even put a small explosive under one of his teacher’s desk. Their most effective prank had been to scramble TV frequencies with a remote control. Wozniak and Jobs would hide in the bushes while university students were watching television.

On cue, the TV would be scrambled with a small device Woz had built, and one of the students would get up to fix it. Wozniak played around so that the student would be compelled to hold an awkward position in order to keep clear the TV signal. Wozniak’s device was highly effective in manipulating people.

 

Starting A Company Is Very Difficult:

If you’re not passionate about what you are doing, then you will give up. So in order to succeed you need to be passionate, and hardworking. It turns out that Woz and Jobs were not trying to build a company at first but were in fact trying to build a computer that they wanted. They had not gone to business school, and they didn’t even know what the Wall Street Journal was. They wanted to just go build a computer so that they and their friends could use it.

Meet A Brilliant & Noble Engineer:

Jobs was fortunate to meet Steve Wozniak who believed in engineering as the highest, and most noble activity. ‘Woz’ did not believe in marketing, and did not aspire to be in the lime light. Their meeting was truly fortunate. Wozniak’s father taught his son how to build circuits at an early age. His father also taught ‘Woz’ to never lie, accept in the service of a good practical joke. Wozniak had an easier time making eye contact with a circuit than a girl, built a transistor to allow 6 kids to communicate with eachother, read about new computers in his spare time, and focused on designing circuits. Wozniak was socially shut out in high school. Wozniak worked on designing computers with half the number of chips the company had designed in his blue prints. Jobs had inferior tech-skills but had other advantages like charisma and persuasiveness.

 

Meetups Bring Insanely Great Ideas Together:

The Homebrew Computer Club did not conform to the Hewlett Packard mold, or the hierarchical business structures of the UK, Japan or Germany. In Silicon Valley, USA, there were study groups who were building up computers for creative meetups. These were basically self-fulfillment movements in the California area of Silicon Valley where everyone was sharing ideas, and everybody was gaining from that exchange. For most people, computers were ominous, government machines that would destroy life values. By the mid-1970s, computing was no longer a bureaucratic control mechanism but rather a liberating one.

The Altair computer was available in 1975 from MITS, and Bill Gates started building BASIC which would become the first software product from his company Microsoft. Jobs and Wozniak bought the Altair as well in order to learn how it worked.

Borrowing ideas was the way that Wozniak developed the Apple I. He started to sketch out the idea of the Apple I from 1975 to 1976. Since the Intel 80 was so expensive, Wozniak bought a bunch of microchips that were not Intel compatible. This incompatibility would subsequently not allow Apple computers to work with other software products without some modifications. Wozniak built on the shoulders of previous processor chips, and he wrote the code by hand. When he had built the prototype, and the letters were displayed on the screen correctly, there was great excitement. It could not have happened in New York, London, or a small city in France. Innovation is geographically situated because you need to meet the right people, and be at the right place for this kind of success.

 

Knowing What You Wanted To Do Earlier On Is Not Great For Entrepreneurs:

Steve Jobs wanted to go to Reed College because Stanford students already knew what they wanted to do. Reed College had a high dropout rate, and they tuned in, turned on, and dropped out. At Reed, Jobs did a lot of drugs, and he still swears by the importance of taking LSD. Steve Jobs refused to go to Reed classes that he was assigned, and focused on taking classes he was interested in, as well as breaking the rules. Steve Jobs decided that using his parents college funding which his parents had saved was unfair so, and he dropped out, but he didn’t want to leave Reed. Remarkably Reed allowed Steve to stay, and he audited classes. Steve Jobs learned about typography, and he found it fascinating. Jobs rejected the lack of idealistic vision in the 1980s, and he believed in the importance of the counter-culture movements of the 1970s.

 


Steve Jobs Excluded Relevant Information Where Necessary: 

Wozniak was at HP but would come by to play the new Atari games because Jobs was working at Atari. In the 1975, Bushnell asked Jobs to design a single player game which required that bricks fall towards the paddle when struck by the ball, instead of having a computer or a simple wall to compete with. The head of Atari knew that Jobs could not build such a computer programme but he knew that Jobs would likely enlist the help of Steve Wozniak. There was a bonus offered for every chip used below 50. Jobs told Wozniak that this project needed to be completed within 4 days, he then said that they would split the payment. Wozniak was so enthusiastic that he worked hard to get it done on time. The deadline was a false one as Jobs wanted to go apple picking that weekend.

In addition, Jobs did split the payment for the project but he failed to mention the bonus for the number of chips below 50. There were 45 chips so Jobs received 100% of the bonus that Wozniak did not know about. 10 years later on the history of Atari, it was revealed the Jobs was given a bonus and Wozniak was shocked. This program was the basis of the final product which was wildly successful as an arcade game. Wozniak states, “I’m not going to judge Steve’s morality. Apple wouldn’t be where it was without Jobs manipulative nature.”

 

Have Discipline Over Body & Mind:

Steve Jobs got into a disciplined fasting by eating just apples. He believed that minimalism led to great rewards when encountering complexity, and that experience is relative. Vegetarianism, acid, rock music, and the enlightenment campus seeking culture at Reed College was a laboratory for Steve Jobs’ development. Steve Jobs had extremely terrible BO in college because he did not believe in using any chemicals or deodorants. At Reed, Robert Freidland was able to mesmerize him. Jobs learnt from Freidland about charisma, and the art of persuasion. Friedland was a LSD drug dealer, and was sentenced to two years in prison in 1972. When he was released, Friedland ran for student president at Reed College. Freidland had met the Maharaji in India, and Jobs learned about how a state of enlightenment could be attained through practiced mediation. Steve Jobs had an ability to stare people deep into the eyes. Freidland taught Steve Jobs how to initiate the reality distortion field by bending the situation to his will. Freidland was dictatorial, and wanted to be the centre of attention, and a real salesman. Jobs said LSD helped him to understand the connection with human history, and the absence of the need for profit. Steve Jobs was hardly interested in presenting himself in a proper way throughout the early years of Apple Computer Inc.

Picking A Name Is As Simple As Picking Apples:

Steve Jobs was on a fruitarian diet and he picked apples at the One Brand Farm which was a hippy commune. Apple Computer was a smart choice as a name because it was friendly, and simple. It was counter-culture, and nothing could be more American. Apples and Computers don’t go together so it got people thinking.

Crime Does Pay!!!???: 

If you own an Apple product then you are complicit in supporting crime, kinda but not really… However, we forget that sometimes rules have to be broken in order to innovate. Read the following and see if you agree that we might never have heard of Apple Computers without an illegal gadget called The Blue Box…..

Steve Jobs and Wozniak Created Through Illegal Activity

Share this Image On Your Site


Crime Does Pay? Paul Jobs (Steve’s adopted father) made extra money by souping up cars without telling the IRS, and this was duly noted by Steve. When it came to borrowing, Steve Jobs didn’t mind using his high school’s money to buy parts from a major company. After-all, to Steve, hus school had a lot of money. By 1971, Steve Wozniak had read in Esquire about hackers, and ‘phone-freakers’ who had invented a way to cheat phone companies. Woz read the article to Jobs over the phone from college. The so-called Blue Box was invented by a guy named Captain Crunch. It was interesting because the device mimicked the dial tones necessary to connect long-distance calls thereby allowing calls to be made for free. Jobs and Wozniak went to work reading the Bell System Technological Journal produced by AT&T in order to mimic Captain Crunch’s long-distance tones mimicking device. Of course, this was all illegal.

After much research and work, the two Steves created their Blue-Box device which allowed them to call the Pope, Australia, and elsewhere free of charge. Jobs always felt that stealing long-distance calls was fair when a company like Bell was involved. Although it was illegal, Jobs believed they could sell these devices, and they did manage to sell over 100 of them. Jobs did all the pitching of the Blue Box to random people in the Palo Alto area. It was their first real entrepreneurial endeavour. In an illegal market like telephone hacking, however, there were risks. In one encounter, Jobs and Wozniak were robbed of one of these devices by a crazed man who held Jobs and Woz up at gun-point. By doing something illegal, Steve Jobs and Wozniak gained confidence that they could put a product into production. The Blue Box gave them a taste of the combination of engineering and vision. The lesson is that it turns out that crime does pay when the work is the forerunner of something like Apple.

Sharing Ideas Is Fine Up To A Point:

The Homebrew Computer Club (a collection of computer enthusiasts) believed that their ideas should be shared, exchanged, and disseminated. It was coordinated by people who believed that like-minded nerds should all share information for free. They believed that there should be no commerce at the Homebrew Computer Club. Wozniak supported that view, he wanted the Apple I to be shared for free with other people at the Homebrew meetings. Others disagreed. Bill Gates wrote a letter to the Homebrew Computer Club saying the opposite; that they should stop stealing the programming that he and his partners had created.

The letter argued “Who can afford to do their professional work if everyone is stealing it?” Steve Jobs agreed with Bill Gates about sharing ideas. Jobs convinced Wozniak to follow a closed approach, and to sell computers rather than sharing them. Jobs asked that Woz stop sharing the schematics information regarding the Apple I with others, for that reason. Jobs decided to sell these computers by buying 50 panels for circuitry. The closed system had major benefits in his later career. Starting in 1999, Apple created iMovie, FinalCut Pro, iDvd, iPhoto, GarageBand, (most importantly) iTunes, and the iTunes Store. The personal computer was morphing into a lifestyle hub, and only Apple was positioned to create a full (CLOSED) experience where the product was simple, and enjoyable. Therefore, sharing is great up to a certain point.

 

Most Good Ideas Have To Be Forced Down People’s Throats:

Wozniak did not want to go into business, but Jobs convinced Woz to join Apple. But first, Wozniak decided that he would do the ethical thing by telling Hewlett Parckard about his Apple I product which he had constructed based on his experience and training at HP. Wozniak presented the Apple I to executives at HP, but they did not think a personal computer made any sense. During one Homebrew Computer Club gathering, Jobs showed the Apple I and after his presentation he asked how much people would pay for the Apple I. The room was silent, no one was interested in buying the Apple I. That is, no one but Paul Terrell who owned an electronics store called The Byte Shop. Even Atari was pitched by Jobs, but they thought Jobs was a clown.

Apple’s first order was for a total of 50 computers from Terrell for $500 each. It took until 1981 for IBM which had dominated the mainframe computers industry to enter the personal computer market while Apple dominated as the fastest growing company in the history of the world at that time, and had already been in the process of developing both Lisa, and the Macintosh.

Another example is that Xerox PARC researchers had invented the Graphical User Interface (GUI) which was visual point and click system that would replace the black screen coding required to operate a computer previously. The only problem is that the Xerox management did not want to explore this personal computer technology. The management at Xerox did not understand the vision of these researchers at Xerox PARC and could not see a P&L statement that justified the time and energy to make the leap from photo-copying to personal computers. Steve Jobs would later explain that the Xerox management were “copy-heads.”

Adele Goldberg showed Jobs the Xerox GUI, but she was angry that Xerox was allowing Jobs to see ‘everything.’ She understood that Xerox had “grabbed defeat from the jaws of success” according to Jobs, by giving him access to their R&D work in exchange for shares in Apple. Without Jobs’ visit to Xerox PARC, the Macintosh, and Lisa would not have had the GUI, and Bill Gates might not have subsequently revolutionized computers with Windows.

Run Your Company Out Of Your Parents House In Order To Appear Like a Real Company:

In order to fulfill their first order from Mr. Terrell’s electronics store, Jobs ran Apple out of his parents house. This was complicated by the fact that Jobs’ father would frequently insist that he rightfully watch the end of Sunday football instead of letting Steve program computer chips on the family tv screen. Things were awkward; they even had a company phone number which was diverting calls to Steve’s mother who acted as secretary…

A curious brand marker has been the much vaunted Apple logo. Interestingly, the original logo of Apple was a ridiculous picture of Newton and a quote from Wordsworth (as seen on the left side of your screen). For the Terrell batch, Jobs and Wozniak marked up the price of the computer from production to $666.66 for every Apple I sold. Steve Jobs claimed that he was a private consultant at Atari in order to improve his start-up’s credibility. The original Apple I was displayed at a computer fair. Wozniak was the best circuit engineer, but the Sal 20 was better looking. Apple I looked like it was not created by serious people. That is when Jobs realized he needed to build a fully packaged computer, and he was no longer aiming for hobbyists but for the people who wanted to use a computer which would be ready to run out of the box.

Jobs and Wozniak agreed to start their own computer company with $3,000. Wozniak was excited to start a company with Steve Jobs. Apple started with $1,300 of working capital. Wozniak wanted to use his Apple work at HP, but Jobs insisted that the work should be  controlled within Apple, and not given to HP. Steve Jobs’ idea was to have control over the computer, and Jobs created tools so that no one but Apple employees could open their computers. Wozniak refused to leave HP, and Jobs forced Wozniak to give up HP by calling Woz’s family and friends. Jobs actively cried a lot over the phone to Woz’s family in order to convince Wozniak to quit his day job. The only way to get Wozniak onboard was if he could stay at the bottom of the organizational chart at Apple from 1977 onwards. That was not a problem for Jobs.

 

Mike Markkula’s Marketing Theory Is Built Around Three Ideas:

First, you need to connect with your customers, and understand their needs and aspirations. You need to understand their needs better than any other company. Second, you need to focus, and eliminate any activities that do not help to achieve your goal. Third, is to impute. You need to make sure that your brand is respected, because people form their opinion of you based on the signals that you convey. You might have the best product but if you present them in a slip-shot manner you will not get what you want. Steve Jobs would always impute the desires of his customers. He cares about the packaging, and cared about setting the tone for how customers perceived the product.

MacKenna’s Advertising Style Worked: The Apple logo was developed as a multi-colour symbol. The brochure read “Simplicity Is the Ultimate Sophistication.” Apple’s display area in computer fairs was always very impressive. There were only 3 Apple IIs that were finished for the computer fair in 1977, but they stacked up Apple II boxes to suggest they had more. Steve Jobs and Wozniak were forced to dress up, and they were trained on how to act by Markkula.

 

Don’t Worry About A Business Plan Until You Need Investment In A Serious Venture: 

Mike Markkula entered Apple because Jobs needed money to get the Apple II built. They needed to build inventory, and they needed to develop a marketing strategy, and distribution in order to build a business plan. Markkula worked in computer chips, and was excellent at finance, and price measures, Markkula was very successful already. When Markkula showed up he had a convertible. He wrote a business plan that centred on guesstimates of how many people would own a computer in their home. Markkula wanted Apple to balance check books, and keep receipts. The spirit of Markkula’s prediction was true.

Markkula co-signed a bank loan of $250,000. They owned 25% of the stock, and Apple was incorporated on April 1, 1976. He believed that Apple was at a start of an industry. Apple Computer was growing at an incredibly fast rate. The numbers were mind-blowing: from 2,500 Apple IIs sold in 1977, 8,000 were sold in 1978, and up to 35,000 in 1979. Remember there was no market for personal computers before! The company earned $47 million in revenues in fiscal year 1979, making Steve Jobs a millionaire on paper (he owned $7 million worth of private stock). Markkula believed that Apple would go public within 2 years, it went public on December 12, 1980 at $10 per share making over 300 people millionaires. Several VCs cashed out reaping billions in long-term capital gains. Through Markkula, Jobs learnt about marketing and sales. Importantly, Markkula did not want to start a company just to get rich.

 

Your Product Needs To Be A Full Simple Package:

Jobs went in to pitch Atari for support for Apple II which had colour, a power source, and keyboards. It was rejected partly because Jobs went to the meeting without shoes. Another company, building the Commodore decided that it would be cheaper to build their own machine. The Commodore Pet came out 9 months later which sucked according to Jobs. Jobs was willing to sell to Commodore but Wozniak felt that this was a bad move. They designed a simple case for the Apple II which would set Apple apart from other machines. The VisiCalc also allowed Apple II to breakinto in the Financial market. Jobs wanted light molded plastic, and offered a consultant $1,500 to produce the design. The Apple II had the advantage of not requiring a fan, or multiple jacks. Jobs wanted a closed system, a computer that was difficult to pry open. Conversely, Wozniak wanted to give hackers the chance to plug in, but Jobs did not want that option.


Steve Jobs endorsed the view that less is more, and that God is in the details. Jobs embraced the Bauhaus style which rejected Sony’s approach of gun metal or black. The alternative was to create hi-tech products by packaging the products in beautiful, white, and simple casing. Apple customers understand the value of presenting their products out of the packaging. You design a ritual of unpacking a product. Jobs also felt that intuitive ideas need to be connected in computers

Jobs’ Management Style Was “Shit” from 1977 to 1985 Firing:

Steve Jobs loved to tell people that their work was shit, and would force his co-workers to pull all-nighters to finish applications. When Apple started to get going in 1978 – 1979, he would come into the office, and tell Wozniak’s engineering team that they were all shit. This further distanced the two as Wozniak felt that Jobs was abusive, and had changed. Jobs would cry easily, and he would put his feet in the toilet bowl in the middle of the day to wash them. For more stability, Michael Scott was brought into Apple Computer Inc as the president, Scott was fat, had ticks, and was highly wound.

Scott was argumentative, and Jobs clashed with him. Jobs produced conflict, and he was only 22 years old, but Apple was Jobs’ company, he did not want to relinquish control. Steve Jobs and Michael Scott fought about employee numbers. Steve Jobs wanted to be employee number 1, and Wozniak would be number 2. So Scott made Jobs’ badge number O but in reality Jobs’ pay role remained number 2. Scott was a pragmatist while Jobs was not. Steve Jobs started crying over a one year warrantee for the Apple II. At age 26, he had a successful company and the Apple II. In 1981, Jobs was kicked off the Lisa project and took over Macintosh so that he could make a contribution comparable to Wozniak.

Once at Macintosh, Jobs was considered to be a dreadful manager. Jef Raskin (who had headed the Macintosh team and disagrees with Jobs on most issues) said the following about Jobs:

  • a) Jobs missed most appointments;
  • b) Jobs acted without thinking and with bad judgment;
  • c) Jobs attacked any suggestion without thinking, claimed it is stupid and a waste of time only to turn around, if the idea was good, and propose the same idea as his own a week later;
  • d) Jobs would never give credit where it was due;
  • and e) Jobs would cry when conflicts erupted in board room meeting.

Michael Scott was fired as he became more and more erratic giving Jobs more power. In retrospect, the New York Times wrote: “by the early 80’s, Mr. Jobs was widely hated at Apple. Senior management had to endure his temper tantrums. He created resentment among employees by turning some into stars and insulting others, often reducing them to tears. Mr. Jobs himself would frequently cry after fights with fellow executives.”

A Startup Will Become Impersonal With Success:

Wozniak wanted Apple to be a family while Jobs wanted the company to grow quickly. Jobs felt that Wozniak had failed him because Woz appeared to be unfocused, and failed to get a ‘floating point’ BASIC finished for Apple II. The Apple II launched the personal computer industry. Wozniak had created the machine, and Jobs designed the exterior which was marketed more effectively. Steve Jobs wanted to spur a great advance in computers. This meant that the company had to hire more and more people, and Jobs became increasingly disrespectful towards slackers, and B Players within Apple. The point is you can’t really have a family environment in a startup that scales. And you need to scale in most competitive industries because the big players will try to destroy you at every turn. If you want to have a family like atmosphere then good luck you but expect to fail.

Apple III Was A Bastard Child Idea: 

Apple created a failed project, and it was not marketed well. The design that Jobs insisted on was not manageable for the circuits, and the Apple team all collectively made their contributions to the device so it was a gigantic mess. Steve Jobs insisted that there be no fan in the computer, as a result, the design did not allow the computer to cool properly, and it frequently overheated, the only way to prevent the chips from disconnecting with the mother board was to drop the computer onto the desk which customers were instructed to do whenever they phoned Apple; “Okay, just pick the computer up and drop it on the desk, that should knock the chips back into place.” The IBM PC crushed Apple III in sales. It was a disaster.

Being Abandoned = Ignoring Reality & Discrediting That Reality:

Steve Jobs had an illegitimate daughter that he didn’t bother to recognize as his at first. How’d that happen? In the mid-1970s, Jobs lived in a four bedroom house, and rented the place out to strippers. Chris-Ann Brennan lived with Jobs in separate rooms, apparently they lived as weirdos, and did acid. When Chris-Ann became pregnant with Steve’s child, he became disconnected from the situation, and did not deal with the pregnancy. He could be engaged and disengaged in minutes. Chris-Ann Brennan and Jobs had sex, but instead of taking responsibility, he engaged in character assassination against Brennan, and tried to prevent a paternity test in order to avoid dealing with the possibility of bringing a child into the world. He did not want to take responsibility, and he decided to believe in his own lies, according to Isaacson. Steve and Chris-Ann were 23 when they had their child, which was the same age as Jindal (Steve’s biological father) when he had Jobs. Jobs did not try to help Chris-Ann, and instead would ridicule her.

Walter Isaacson speculates that being abandoned by his biological parents led to this heartless/irrational behaviour, but it’s not entirely convincing and clear. Another classic example of ignoring reality would be when Jobs was diagnosed with cancer, but waited 9 months before pursuing surgery. Ignoring reality is how Jobs got through tough times.

Robert Friedland helped Chris-Ann Brennan have her baby girl but Steve Jobs helped name the child, and Jobs insisted in the name Lisa Nicole Brennan.  Finally, a year later, Jobs agreed to get a paternity tests where he was found 94.1% likely to be the father, and a Californian court forced Jobs to pay a monthly child support bill of $385. Despite the test, he claimed at Apple that there was a large probability that he wasn’t the father. He did this by using statistics improperly. Jobs claimed that 28% of the male population of the US could have been the father. When Chris-Ann heard what he said, she interpreted it as if Jobs was claiming that she had slept with 28% of the US male population.

 

Good Artists Borrow, Great Artists Steal:

The best way to predict the future is to invent it’ was one of Steve Jobs’ favourite sayings. Jobs was granted access to Xerox PARC which was established in the 1970s as an R&D digital spawning ground in Silicon Valley for Xerox. One of its products was the Xerox Alto which was a new computer interface that went beyond the BASIC systems like MS-DOS (ie. black screen + code commands), and in the process created a desktop that was called the Graphical User Interface (GUI) ie. everything on the screen was visually represented by icons. Meanwhile at Apple, Jef Raskin brought Bill Atkinson on board in the Macintosh division to develop a cheaper version of LISA but of course, Jobs wanted to get on the front of the wave, and “make a dent in the universe”. Jobs began to exert more influence on the Macintosh project which was Jef Raskin’s brainchild. Jobs hated Raskin because he was a professor/abstract thinker, and Raskin was obviously in control of the Macintosh project which Jobs saw as his own way forward.

In 1981, Jobs gave 100,000 Apples shares at $10 per share to Xerox in exchange for access to their Xeroc PARC. When Steve Jobs saw the demo of GUI he was amazed that Xerox had not commercialized these innovations: 1) the networking, 2) object oriented programming, 3) the mouse and GUI. With this one visit, Steve Jobs had found the way to connect users to the future with GUI, and a way to leapfrog over Raskin’s plans for Macintosh. Steve Jobs was proud of his stealing the great ideas from Xerox. What transpired was less a heist by Apple but a fumble by Xerox. Xerox was too focused on photocopies, and selling more machines. Ideas are important but execution and positioning is also crucial. Microsoft would subsequently ‘steal’ the GUI concept from Apple, but in reality, Bill Gates had also visited Xerox PARC.

 

The Bicycle Alternative to Macintosh nameSurround Yourself With “A Players”:

In the early 1980s, Jobs recruited people by dramatically unvailing the MacIntosh, and seeing how interviewees responded to the designs. He even unplugged an engineers computer named Andy Hurtsfeld (while he was coding), and forced him over to Macintosh from the Apple II team because Jobs recognized Hurtsfeld’s A Player status. You need to build your company with a collaborative hiring process where a candidate tours around the company meeting everyone that is relevant for hiring that candidate. Why? Because Jobs may not have always had A player ideas. For example, he wanted to call the MacIntosh the ‘bicyle’ because like an actual bike, the MacIntosh would help the human achieve objectives that were not possible on their own. The idea of the Apple Bicycle was shot down by wiser marketing minds. A Players hold you in check.

When Wozniak crashed his airplane in February 1981, he left Apple Computer. After the launch of MacIntosh in 1984, Scully merged the MacIntosh and Lisa teams with Jobs as their head. Jobs told the Lisa team that he was firing 25% of their team because they were B and C players. The management of the MacIntosh team would all gain top positions in the amalgamation. It was unfair, but Jobs latched on to a key management experience, that you had to be ruthless to produce an A Player lineup.

For Jobs, if you hire a B player you will cause of Bozo explosion. B players always want to hire people who are inferior to them. C players hire D players. So keep the best people in your team, and make sure that you keep the right people in your organisation. He believed that if you let any B players into your organization, they would attract other B players as well. A players love to work with other A players, by definition, they want to grow and be the best. That is what makes A Players valuable.

 

Reality Distortion Field:

This reality distortion field was empowering. Bud Tribble in the early 1980s said that “Steve has a reality distortion field. In his presence, reality is malleable. He can convince anyone of practically anything. […] The reality distortion field was a confounding melange of a charismatic rhetorical style, an indomitable will, and an eagerness to bend any fact to fit the purpose at hand.” It was self-fulfilling, you do the impossible because you would believe it. Jobs could deceive even himself which allowed him to con other people. Jobs used this tactic which helps to make irrational goals real. The rules didn’t apply to him. He was a liar, and the Reality Distortion Field is a creative way of saying that he was a liar. As a child, Jobs had been rebellious, and this plays into his special, abandoned, unique self. If you trust Jobs, he will make it happen.

That is the great part about the reality distortion field. If you pretend to be completely in control, people will believe you are, and will be empowered. Jobs was so passionate about Apple and NExT devices, and his force of personality allowed him to change peoples minds as a salesman. Steve Jobs was able to change reality by using charismatic rhetoric, and bend facts. The reality distortion field was never acutely apparent. Jobs was lying quite a lot during team meetings.

As a result, it was difficult to have a realistic deadline since bending facts has its downsides (Think wasteful factory decorations, missing product dates at NExT etc). Jobs did not like manuals, and told Gates in 1984 that they should not have any manuals, but Gates did not bother mentioning that they had an entire team working on manuals for Mac. Bill Gates was completely immune to Steve Jobs’ reality distortion field. When reality hit, Jobs had a difficult time dealing with it.

 

Be At The Nexus of Humanities and Technology:

Connecting arts with technology is powerful. Jobs practiced Buddhism & mediation. Simplicity is important for a company. And it is evident that Buddhism was instrumental in Jobs’ development of Apple. Keeping it simple is essential to producing a user-friendly product that even the parents of baby-boomers can use. In his senior year, Jobs loved King Lear, Plato, and Dylan Thomas. Steve Jobs took AP English in high school. Jobs worked in electronics, and learnt about literature. Jobs took an electronics class at high school with McCaulum.

At Reed, Jobs audited a typography class which Jobs later argued was responsible for the Mac having typeface or proportionately spaced fonts. Steve Jobs understood that creative people are disciplined but technology people think they are lazy, while technology people do not know how to communicate intuitively to people, and have created a secret language to exclude ordinary people. Steve Jobs bridges that gap beauty through his life’s work. Producing something artistic takes real discipline.

 

The Believe In A Closed System & Product Control:

The architectural structure and software had to be tightly linked according to Jobs. Functionality would be sacrificed if one were to allow for multiple software producers. While Microsoft could be used on any hardware, Jobs refused to have Apple computers fragmented by the work of partners who did not follow Apple’s rules. On the customer level, Jobs refused to allow users to alter the product, pitching the idea that Apple products were more user friendly (which they were). He did not want to give users control. The closed system is useful for the iPhone era but not from 1981 until the mid to late 1990s with IBM (Big Blue) and Microsoft working across platforms; Apple’s competitive advantage in the PC market eroded dramatically in the early to mid 1980s. By scaling with multiple hardware platforms such as IBM PCs, Dell, and Compaq, software developers had an open-source alternative to the closed Apple system. Bill Gates realised this closed system problem in the early 80s and exploited it. Jobs wanted end-to-end control so that software developers had to buy into the Apple system, however, critical mass was essential for that to work. In 1982, Jobs wanted the industry standard to be Apple software + hardware, he did not want sales cannibalization that comes with allowing other computers to use the Apple Operating System on their computers. But for developers, the labour required to work within Apple’s ecosystem was prohibitive compared to the gains made by working on an open-source PC world. As a result, in 1997, Jobs admitted that they had been overly proprietary, and thus failed to see how that was hurting their marketability from 1984-1997. In the 2000s, the closed system had the advantage as Apple become a premium/closed brand through carefully working with 3rd parties.

 

Market Research Is For Idiots:

For Steve Jobs, Apple was about producing what people did not know they wanted yet. To be innovative, meant producing what he believed was needed. He was not interested in group testing his products. He once asked, “Did Alexander Graham Bell create a focus group before inventing the telephone?” Customers are going to try to get a better, cheaper computer. Focus groups do not tell you what the customers actually need. Customers do not know what they want.

 

Macintosh As The 3rd Industry Standard:

Bill Gates’ Microsoft appeared in Hawaii for the software dating game. The Macintosh was the product that Bill Gates felt was revolutionary. The ideal relationship would be for Bill Gates to work exclusively with Apple but that was not Gates’ strategy. Gates wanted to be a competitor, and wrote software for the IBM. In 1982, 279,000 Apple II were sold compared to 240,00 IBM but in 1983 there were 420,000 Apple II versus 1.3 million IBMs and clones. IBM had taken 26% of the market, and IBM/Clones would take over half of the market which included other compatible PCs.

Motivate With The Big Picture:

Steve Jobs was not interested in profiting more than competitors, but in producing a better, more beautiful computer. Macintosh’s team was burned out in conflict, and demoralized but Jobs had moments of brilliance. To counteract the negatives of Jobs’ management style, he would illicit the big picture. In one meeting, the issue was with regard to the booting time/start time for a new computer which was over a minute long. Jobs explained that if you combined 1 million people’s boot times, it would add up to many many cumulative hours of waste. In dramatic terms, Jobs argued that reducing the booting time by a few seconds could save about 50 lifetimes in total.

‘Making a dent in the universe’ was the overarching idea behind Apple. In 1981, IBM released their own personal computer, and Apple was confident about their market position. The problem was that IBM was a more powerful company, and had real strengths in the corporate establishment, and brand recognition. The Big Blue vision was to crush Apple, and IBM was the perfect foil for the spiritual struggle of Apple. Jobs felt that once IBM gains in a market sector, they almost always stop innovating. For Jobs, IBM was a force of evil, later the enemy was Microsoft and then Goggle subsequently.

 

Unhealthy Competition Within A Company Can Be Corrosive:

Entrepreneurs do not always transition into effective managers. Steve Jobs had a pirate flag waving over his Macintosh office at Apple. The Lisa team was jealous of this renegade team, and stole their Macintosh pirate flag as a prank. The Macintosh members then found the secretary who was hiding the flag under her desk, and wrestled it from her. This bizarre corporate behaviour had a negative effect, it said that Jobs team was better than other ones, and it was divisive within the company.

Steve would not allow Apple II employees to visit the MacIntosh office. Jobs wanted people to know about Macintosh but he wanted everyone else at Apple to know that they sucked even though Apple II was generating the revenue for the company. Steve Jobs’ Macintosh team seemed to be trying to destroy Lisa because Jobs was kicked off the project.

The Lisa team did feel that the Macintosh was undercutting Lisa since people were going to wait until Macintosh was released before buying their next Apple product, as it was announced in 1983 that Macintosh was on the way. In the PR campaigns, Steve Jobs admitted that the Macintosh was better than Lisa, and within two years Lisa was too expensive, and would be obsolete. Within months of Lisa’s launch, Apple had to pin the companies hopes on Macintosh.

 

The Best & Most Innovative Products Don’t Always Win:

The Microsoft team members wanted to know everything about the OS operating system during their close partnership with Apple in 1983. Gates believed that GUI was the future, and he claimed that the Xerox Alto was the foundation of all personal computers so Jobs was stealing the idea anyway. By November 1983, Gates admitted that there were plans to create an Microsoft operating system to be launched on all IBMs and clones.

The product was called Windows. Steve Jobs was furious. Part of their partnership in 1982 onwards was that Microsoft would not develop any programs for IBM until a year after the MacIntosh launch in January 1983. Unfortunately, Apple did not launch the Macintosh until January, 1984 so Gates was within his rights to proceed with licensing to IBM. Gates came down to Apple, and Jobs assailed Gates “You’re ripping us off! We trusted you.” Bill Gates put it well, “We both had this neighbour named Xerox, and I broke into to house to steal the TV but found that you had already been there.” When Gates showed Jobs what he had developed for Windows, Jobs did not complain that it was stealing because he told Gates right to his face that Windows was a “piece of shit.” Jobs was almost crying about it, and went on a long walk in November 1983. Apple and Microsoft were now in serious conflict at this point. Windows was not launched until 1985 because it was not very good, but Microsoft made Windows better over time, and by 1995, it was dominant. Until the return of Jobs in 1997, there was a dark period of Microsoft dominance in the computer industry according to Jobs. The open system approach that Microsoft adopted by working with multiple hardware partners proved better because it allowed Microsoft to get on to multiple platforms for scalability. Meanwhile, other Apple developers began working with clones as well.

 

Eras Are Defined By Partnerships & Rivalry – Gates Versus Jobs Round 1:

Two high energy college drops ended up shaping the commercial PC market. Bill Gates created a program for scheduling classes, and a car counting program while in high school. Gates was skilled at being logical, practical, and analytical while Jobs was design friendly, and less disciplined. Gates was methodical in his business style. Bill Gates was humane but could not make eye contact. Gates was fascinated by Jobs’ mesmerizing persona but saw Jobs as rude and cruel. Jobs has always maintained that Gates should have dropped acid to open up his mind to creativity. The only thing Gates was open to was licensing Microsoft to Apple but not on an exclusive basis. Jobs long believed that Gates was not a creative person, and that Gates ripped off other people’s ideas or at least did not have original ideas. Meanwhile, Gates derisively called Macintosh “S.A.N.D.” ie. Steve’s Amazing New Device. Gates mentions that he did no like Jobs’ management style, as Steve had a tendency to call his own co-workers idiots on a regular basis.

The rivalry was also beyond the personal. In 1982, Apple’s sales were $1 billion, while Microsoft made $23 million. Jobs had an attitude with Gates that suggested Gates should be honoured to work Jobs, it was insulting. From Jobs’ perspective, Gates did not understand the elegance of the Macintosh. There were 14 people working on the Macintosh while Microsoft programmers created applications that had 20 people working on programs to Mac.  Their rivalry was deep and probably spurred innovation forward for that reason.

 

Genius Versus Shit-Head:

For Steve Jobs, you were either a genius or a shit-head/bozo. He sought absolute perfection, and he loved to define people according to this rubric. Steve Jobs tended to be high voltage and might actually say that an idea you proposed is ‘piece of shit idea’. But then he would turn around to propose your idea as his own a week later. Sometimes, he would then take your position in an argument, and agree with you just to mess you up. Jobs could not avoid impulsive opinions, his team at Macintosh were used to moderating his opinions, and not reacting to the extremes of either being a ‘piece of shit’ or ‘genius.’ At Macintosh in the 1981 – 1985 period, Atkinson taught his team to interpret “this is shit” to mean “how is this the best way?” when speaking with Jobs. Steve had a charismatic personality, and knew how to crush people psychologically. In addition, he had huge expectations with his Macintosh team, and it created a fear factor. If you demonstrated that you knew what you were talking about, Jobs would respect you. From 1981 onwards, employees were annually awarded for standing up to Steve Jobs. One marketing specialist stood up to Jobs twice because the marketing projections were unrealistic in 1981. She won the award having at one point threatened to stab Jobs in the heart.

 The Boardroom Showdown & Emotionality:

In May 1985, the boardroom meeting to demote Jobs from Macintosh was nasty. Jobs presented his case first saying that Scully did not care about computers but in response a manager retorted that Jobs had been behaving foolishly for over a year. Scully then presented his case to the board for demoting Jobs and stated that he (Scully) would either get his way or they would need a new CEO. Scully said that Jobs should be transitioned slowly out of the management role at Macintosh. Jobs felt betrayed by Scully. Steve Jobs was emotionally unstable, and even felt as though he should be able to repair his friendship with Scully. Meanwhile, Jobs would spend a lot of time plotting against Scully in light of his career crisis.


Advertising Does Matter:

The 1984 Ridley Scott advertisement entitled “1984” was a way of affirming a desired renegade style, and attached Apple Computers with the rebels, and hackers. Ironically, Apple was a controlled system. Jobs believed in total control. Initially, the 1984 Ad was not popular on the board at Apple. Markkula and Scully thought it was the worst commercial ever, and that they should not put it on during the Superbowl. They were proven wrong by the timelessness of that 1984 Ad. The next advertisement in 1985 was an ad focused on insulting business people by showing them that they were walking off a cliff as if to suggest that they were blindly following the IBM brand. When the commercial was featured at the 1985 Superbowl in January, there was little reaction, and in truth it was a blunder since it insulted the market it was trying to reach. Apple performed poorly in 1985, the ad is not the cause of the outcome but was a symptom of Apple’s situation in 1985; IBM was expanding immensely.

Frame Your Business Around War – Big Blue Versus Apple:

During the 1984 Apple shareholder meeting, Jobs set the stage for the epic conflict between IBM and Apple. The question Jobs asked at the 1984 conference was “Will Big Blue dominate the entire computer market? Will they control the entire information age? Was Geroge Orwell right?” These rhetorical questions helped inspire his company. Afterall, IBM did not have the vision to buy Xerox in the 1950s. Computer dealers fear IBM dominance on pricing. For Jobs, it was about Apple versus evil. Apple is the only hope against Big Blue. With that frame of mind, Apple could do anything. The MacIntosh was finally launched on “time” in January, 1984.

 

John Scully Hello WorldA Messy Company Can Still Work:

When Scully joined Apple, he was surprised at the disorder, and bickering between Jobs and the Lisa team over a) why Lisa was a failure, and b) why Macintosh had not been launched in 1983. Scully felt that Apple was ‘like a household where everyone were running to the beach when there was an earthquake only to discover a tsunami was approaching that forced them back into the house.’ (Isaacson Biography). Things weren’t great on the numbers side for Scully’s first year as CEO either. He had to announce at the 1984 shareholders meeting that 1983 was a bad year for Apple. It was. The competitors were entering the market with cheaper products that were not as user-friendly as Apple but still semi-useful machines. The Apple balance sheet still showed major growth but IBM had launched the PC, and there were many lower-priced clones on the market in 1981 onward which were harming Apple’s competitive advantage.

Steve Jobs Mike ScullyBut Macintosh was marketed as “the computer for the rest of us” and would refocus Apples efforts away from their core Apple II & LISA product offerings. Apples future was bright because there were 25 million information based users in offices across America, and their work had not changed much since the industrial revolution. The only desktop product people used was the phone until the personal computer. Apple hoped that their market share would expand with the unveiling of Macintosh….1984 would prove pivotal for Apples future (to be continued). Below is the balance sheet for the January 24th, 1984 Apple Shareholders meeting.  Apple was a chaotic start-up turned revolutionary full fledged company. It was a messy operation from the standpoint of senior management but generally Apple worked.

Apple RainbowThe Apple Computer, Inc Balance Sheet In 1983            

Current Assets 

Fiscal Year 1983

Cash and Investments

$143,000,000

Receivables – Net

$136,000,000

Inventory

$143,000,000

Other

$47,000,000

Total Current Assets

$469,000,000

Net Fixed Assets

$67,000,000

Other Assets

$21,000,000

Total Assets

$557,000,000

Current Liabilities

$129,000,000

Long-Term Liabilities

$50,000,000

Shareholders’ Equity

$378,000,000

Total Liabilities & Equity

$557,000,000

 

A Clean Factory Is Insanely Great But The Product Has To Sell:

Freemont, California was the location of Apples new automated factory overlooking the Ford manufacturing facility. Apple was more profitable in its early years of existence relative to Ford. Apple was indeed a miraculous company. Jobs spent time going over the machines in the new factory in 1984, at one point, he demanded that the Apple team repaint the machines for aesthetics. This repainting actually screwed up their machines, however, and corrections proved costly. The Apple factory had white walls, and beautiful machines. Jobs believed the factory was a way to establish a passion for Apple amongst employees. Jobs was influenced by the Japanese manufacturing which had a sense of team and discipline. Debby Coleman, a Stanford MBA, was the operations manager. By the end of 1984, the Macintosh’s performance in sales was very low. They had an expensive factory but a failed product.

 

Being Right Isn’t As Important As Winning

Renegades weren’t such a problem to Steve Jobs. In fact, he respected those who stood up to him if they knew what they were talking about on the Macintosh team. Often if they disagreed with Jobs, they realized that they could ignore Jobs’ commandments, and in so doing effectively spare Jobs the embarrassment of making a mistake or a bad judgement. One such incident involved the disk drive called Twiggy which was defective in the Lisa. The alternative would be a 3½ disk drive which was designed by Sony. The dirty Tokyo disk drive factory in Sony did not impress Jobs and he wanted to go with Alps disk drive which had made a clone of the Sony product. So Jobs decided to do a deal with Alps (a competing manufacturer), but Bob Belleville (behind Jobs’ back) decided to hire Sony in secret without Jobs’s approval.

Belleville hired Komoto who was tasked with building a disk drive for the MacIntosh from 1982-83, but Belleville did not want Jobs to know about this backup plan for the disk drive collaboration taking place at Alps, the Japanese company. Whenever Jobs came through the Macintosh office, Komoto was quickly escorted into a closet, or under a desk where he would have to hide for a few minutes at a time. In May 1983, the Alps team in Japan failed to deliver their disk drive, and asked for an additional 18 more months to work out the problems. It was a disaster as Mark Markkula grilled Jobs about what he was going to do about the lack of a disk drive with the MacIntosh launch potentially being pushed back to 1985? Bob Belleville saved Jobs by interjecting that Bob had a disk drive ready thanks to his secret work without Jobs’ approval. Jobs appreciated this renegade behaviour, and swallowed his pride. So we can infer that winning is more important than being right in management.

Bringing In An Outside Expert Can Be Costly:

Steve Jobs was too rough-edged to be Apple CEO so Markkula and Jobs went shopping for an alternative. They focused away from the tech sector to find a marketing genius. John Scully was an outsider who was an expert in management, and a consumer marketer who had a corporate polish. He invented the Pepsi Challenge campaign at Pepsi, and he was good at marketing, and advertising. Scully was struck by how poorly marketed computers were in the mid-1980s. Scully did not actually like computers because they seemed to be too much trouble, however Scully was enthusiastic about selling something more interesting than Pepsi Co.

Scully decided that Apple should work on the idea of ‘enriching their users lives’. Scully was good at generating PR, and excitement around Pepsi. The ability to generate a buzz about Pepsi would be replicated by Steve Jobs in the unveiling of new Apple products subsequently. Initially the two hit it off very well in their meetings about Scully joining Apple. They both admitted to be smitten with each-other over the big ideas surrounding computer technology. Jobs knew how to manipulate Scully’s insecurities to his advantage. Jobs and Scully seemed to understand each-other, and they had become friends, and emotional confidants. The problem was that most marketing people are paid posers, according to a former Apple manager. Scully actually did not care about computers but cared largely about marketing, and selling an idea to the public.

When Jobs showed Scully the Macintosh, he was more interested in Steve Jobs presentation skills than the computer itself. Scully claimed to share with Jobs goals but he was not 100% enamored with the product. Steve Jobs knew that Scully would be able to teach him the most, and Scully successfully sold Jobs the idea of his being appropriate for Apple. Jobs asked him famously: “do you want to go on the rest of your life selling sugar water, or do you want a chance to change the world.” Scully received $1,000,000 in salary, and a $1,000,000 signing bonus as the new CEO of Apple in April 1983.

 

The Original Macintosh Had Bad Sales:

During the planning for the release of Macintosh, the marketing costs needed to be factored into the price according to then CEO John Scully. Scully said $1,999 price was too low because the marketing budget required to spend more in order to sell Apple to the masses. As a result, they set the price to $2,499 for the Macintosh. Steve Jobs argues that this price was the reason that the Macintosh did not sell well in 1984. After the 2nd quarter of 1984, Macintosh started to slump in sales. It was slow, dazzling but not powerful enough. In addition, Macintosh had only 2 applications so there was a major software development gap. It was beautiful but Macintosh used a lot of memory. Lisa functioned on 1000K of Ram. Macintosh had 128K of Ram. There was lack of an internal hard-disk drive.

Jobs wanted to have a floppy disk drive. Macintosh did not have a fan so it over heated easily. When people became aware of flaws, reality hit. By the end of 1984, Jobs made a strange decision, he took unsold Lisa’s grafted on a Macintosh emulation program, and sold them as a new product. Jobs was producing something that wasn’t real, it sold well, and then it had to be discontinued within the company once the extra LISA’s were sold.

People attend the annual Apple Expo at the CNIT center at La Defense in Paris September 15. Apple p..The distribution system did not respond to demand effectively, and there was an inventory backlog which was unintended by Apple Inc. Macintosh very simply did not sell well enough for the production level of building a copy of the computer every 23 seconds. This would later help Jobs realise that a Just-In-Time inventory strategy would be better suited. This was Dell computer’s competitive advantage.

On balance, Jobs’ marketing from 77 to 85 was brilliant but there were some patchy points. Not everything that Apple did on a marketing level had been genius under Jobs’ influence in the 1977-1985 era. We always talk about the 1984 commercial but check out the worst Apple ad ever from 1985 which reads: “you corporate hacks are buying IBM computers without really thinking.”

 

Fall From Grace Through Management Incompetence:

Scully thought that Jobs was a perfectionist, while Scully didn’t care about products at all. Scully did not learn quickly in his new role but was instead focused on marketing and management rather than the products according to Steve Jobs’ recollection. In addition, Scully seemed to be clueless that Jobs was manipulating him with flattery, while Scully believed in keeping people happy and worrying about relationships.  Outside of Apple, the market responded negatively to Macintosh and by mid-84 into 85 a crisis was growing. By early 1985, the managers had told John Scully that he was supposed to run the company and be less eager to please Jobs. Also, Steve Jobs was told to stop criticizing other departments in Apple which was becoming difficult to stomach. Sales in the first quarter of 1985 were only 10% of their projections. Management changes were on the horizon.

Steve Jobs’ abuse of others increased through character assassinations and intense and direct criticism but this was also coupled with a quickly declining market share. Many middle managers rose up against Jobs. Noting the increased tension, Steve Jobs asked Scully if Jobs could create a Macintosh in a book-like format while also heading an “Apple Labs” project as a new R&D off-shoot of Apple Computers. From Scully’s perspective, if Jobs agreed to leave Macintosh, this solution would solve the management issues and get rid of Jobs’ presence at Apple’s head office. Jean-Louis Gassee would move in to take over the Macintosh only if he could avoid working under Jobs. The problem was that Jobs did not want to quit MacIntosh but wanted more responsibility by running both Macintosh and the new R&D project. Finally, Scully had a meeting with Mike Murray. By mid-1985, Apple executives started to blame Jobs for the miscalculated forecasting of Mac sales and resentment built up due to Job’s management style. Mike Murray, Jobs’ lieutenant in marketing, wrote a memo summarizing the problems that Apple had. Murray laid a lot of  blame on Steve Jobs which was a coup considering his closeness to Jobs. Murray pointed out that Jobs had a controlled power-base within the company which created a strategic alliance amongst high value employees. When Scully confronted Jobs, he said that it wasn’t going to work with Jobs’ approach at the Macintosh division. Jobs said that Scully did not spend enough time teaching Jobs as an excuse for the demotion that Scully was proposing ie start an R&D division outside of Apple. Jobs was erratic, he would reach out to Scully, and then lash-out at him behind his back. Jobs would phone one manager at 9pm to discuss Scully’s poor performance, and then he would phone Scully at 11pm to say that he loved working with Scully. The end of the line for Jobs was approaching quickly.

 

Being Vindictive Is Part Of Leadership:

In 1985, Jobs refused a $50,000 bonus for Macintosh engineers who went on vacation during the bonus awarding period. Andy Hurtzfeld quit because he didn’t like Macintosh’s team, or Jobs. Woz and Jobs were no longer friends. As an expression of that, Jobs also shot down Wozniak’s universal remote control company ‘Cloud 9’ by arguing that the design agency should not be allowed to work with 3rd party companies such a Woz’s. Steve Wozniak left Apple saying that the company was not being run properly for the past 5 years. Jobs was vindictive, and convinced himself that Woz’s remote control designs was a problem because it resembled other of Frog’s designs which were used to design Apple products. In 1999, Adobe refused to write programs for the iMac, so when the iPhone was released, Steve Jobs refused to allow flash on its products arguing that these products ate too much battery power, when in reality the core problem was that Adobe had screwed Apple in the past. In other words, being vindictive is part of business leadership as far as Steve Jobs is concerned.

Steve Jobs Rolling StonesRolling Stone PR Stunt:

Apple wanted to build a relationship with Rolling Stone magazine, and Steve Jobs pitched them to get on the cover but they rejected Jobs’ idea. In response, Jobs said that Rolling Stone was a piece of shit in the early 1980s to a Rolling Stone journalist, and that they needed to get a new audience of people who care about technology.

 

Finding Similarities Between Yourself & Your Business Partners May Not Be Good:

John Scully, and Steve Jobs were perfectionists, and they were self-deluded about each other. They had different values, and Scully did not learn quickly. Jobs managed to manipulate Scully into believing Scully was exceptional. Jobs was secretly astounded at Scully’s deference. Scully would never yell at employees, or treat them horribly as Jobs had. Jobs tried to find similarities between himself and Scully in order to justify choosing Scully as Apple’s CEO. Thinking in this way is a mistake.

Eras Are Defined By Partnerships & Rivalry – Gates Versus Jobs Round 2:

As Jobs stepped in the limelight again at MacWorld 1997, he announced a partnership with Bill Gates’ Microsoft stating that a zero-sum game (between Apple and Microsoft) was not the way forward. Gates had stolen the Graphical User Interface from MacIntosh which was borrowed from Xerox PARC, but had struck a deal with Scully to not release a GUI until after 1988. When Windows 2.0 was released, Apple sued them unsuccessfully for IP theft. By 1997, Gates refused to help Amelio create a Word processor. When Clinton began building an anti-trust case against Microsoft for their near monopoly (particularly their destruction of Netscape), and other unethical business practices, Jobs told a Justice department official to continue if only to allow Apple to develop an alternative.

Steve Jobs closed a simple deal with Gates with the agreement that Apple would stop suing Microsoft for stolen IP, while Microsoft would have a $150 million stake in Apple with non-voting shares, and produce Microsoft Office, and Microsoft Explorer for the Mac. At MacWorld 1997, this decision to work with Microsoft was very controversial, and there was a public relations gaffe that Jobs would later regret. When introducing Bill Gates at MacWorld, Jobs decided to have Bill Gates beamed into the auditorium via satellite. The only problem was that Bill Gates was put on a giant projector screen over looking the audience like a powerful overlord or Big Brother.

Force An Ultimatum To Get Control Of A Company:

The Friday executive meeting (in May 1985) was where Scully would confront Jobs about the attempted coup. Jobs said that “Scully was bad for Apple, and the wrong guy, you don’t know how to develop products. I wanted you to help me grow, and you have been ineffective in helping me.” Jobs said that he would run Apple better, so Scully polled the room with each person explaining who would be better for Apple. “It’s me or Steve. Vote.” Everyone supported Scully, and Jobs started to cry again. Jobs left Apple with his core MacIntosh staff. Scully was very upset about what happened. Scully’s wife confront Jobs in a parking lot and said that he had nothing behind his eyes other than a bottomless pit.

Targeting The Education Market Is Not Lucrative:

In September 1985, Steve Jobs announced to the Apple board that he would be focusing on a computer for the higher education market in a new company of his own. This was an outstandingly strange decision since it is not as lucrative as other areas, but he saw a market share for himself. Apple dominated the education market so Jobs took with him key people who would be useful for his goal. Their team would then have proprietary information about Apple’s future goals in the education sector. Jobs raided key employees in a somewhat vindictive manner. Even Markkula was offended at how ungentlemanly he was behaving. So Apple sued Steve Jobs for (a) secretly taking advantage Apple’s plans for the product, (b) secretly undermined Apple by getting new people, and (c) secretly being disloyal to Apple by using their information.

Never Tell The Allies Of Your Opposition That You’re Planning A Coup:

As the summer of 1985 approached and Jobs was transitioning out of his leadership role as the head of the Macintosh division, he begged Scully to reverse the boardroom decision. Scully refused and argued that Jobs had failed to get another Macintosh out to market. May 14th, Tuesday 1985, with a boardroom present Jobs was defiant and argued that it was alright to have Apple II and Macintosh developing two different disk drives. Jobs begged Scully again not to move him out of the role, and in-front of the board, Scully said no. The die was cast. Scully was planning on going to China to launch the opening of Apple to the Chinese computer market, so Jobs started to plan his coup around the Memorial weekend visit that Scully would be going on.  Jobs went around canvassing for the support needed to swing the board against Scully.

The board was largely with Scully. Jobs revealed his plans to Jean-Louis Gassee who was the guy that Scully was going to replace Jobs with. Naturally, Gassee told Scully who immediately cancelled his trip to China. Jobs refused to accept the reorganization of Apple with Jobs as a product visionary. Jobs did not want to play ball. Jobs was excluded from management reports. It was a personal and career disaster for Jobs.

 

How To Save A Dying Tech Company – Return To Your Successful Roots:

Jobs believed that killing the Macintosh clones was the way forward in 1997. He felt that licensing the Mac OS software to third party hardware producers was a mistake and that the largest battle was the software licensing problem for Apple. The problem was that by having a closed system, Apple had to manage its own software development. Microsoft dominated because they produced software that was cross-platform. The clones of Apple cannibalized Apples’ own computer sales even if these clones had to pay Apple software at $80 per sale. Jobs believed that hardware, and software should be integrated, and Jobs wanted to control the user experience from end to end. With this return to Apple’s roots, Jobs was setting a course for creating a closed, highly controlled user experience that had pros and cons.  

 

Avoid The Problem Of Focusing On The Small Battles & Not Seeing The Big Picture:

October 1988, the NeXT launch was an amazing event. After 3 years of consulting with universities across the country, Jobs was betting the company on new technology. Every minor detail was analysed and reworked as the release windows passed for the NeXT computer. In an effort to seek out the best quality technology, Jobs built a highly advanced product but NeXT did not have a floppy disk which was rare for the era. NeXT was risked on the lavish use of Steve Job’s finances to set up his company, and he targeted the higher education industry. The problem was that the features were great but the price of the product was $6,500. At the launch, the applause was scattered when Jobs announced the price tag, the academics were extremely disappointed at the launch event for NeXT because the machine was too expensive. Apparently, the education sector representatives of his NeXT launch were shocked at the cost given the feedback that NeXT had no doubt received. The price has to be low enough to scale the product into universities, other wise the sales pitch has to be extremely aggressive. This price shock was reflected in the sales.

Instead of focusing on price, Jobs’ team focused on features and other details…universities didn’t buy the product. Pricing a product is essential. Most of the features were trivial for the NeXT. In addition, there were too few people interested in building software for the NeXT, and the price was a massive deterrent. In addition, the NeXT was incompatible because few developers were designing the software needed to use the product. Jobs’ strategy was to target the workstations industry where Sun was dominant. It failed, and in 1991, NeXT stopped making hardware much like Jobs had given hardware up at Pixar. By the mid-1990s, NeXT was working in the Operating System market exclusively.

 

Gain Financial Control Against Your Business Partners:

Pixar needed to challenge Disney’s dominance in animation. Toy Story’s success was heavily associated with Disney which was frustrating to Jobs because Pixar created Toy Story. Jobs felt that Pixar was helping Disney roll out their movies and taking all of the credit for Toy Story. Pixar ran and created the movie, and Disney was the distributing channel. There was a need to go public with the Pixar considering that Toy Story was the top grossing film in 1995.

When Pixar was in trouble in 1988, Jobs needed to fire people which he did with a complete lack of empathy. The company was failing partly because their mass market animation hardware did not sell well. He gave these redundant employees a notice of two weeks, but this was retroactive from two weeks before the date of termination! Fast forward to 1995, Pixar was worth $39 per share on the first day of the IPO, Steve Jobs made $1.2 billion dollars in the initial IPO stage (a huge portion of its value). With the success of the IPO, Pixar wanted to assert a co-branding relationship with Disney, rather then being just a studio. Steve Jobs fought to make sure Pixar was every bit as valuable as Disney which later resulted in a Disney take over at a huge valuation.

 

Art Reflects Reality:

Jobs bought Pixar from Lucas films and became a majority stakeholder in 1986. Pixar was technology meeting art which was perfect for Jobs who wanted to live on the intersection of the humanities and technology. He looked into the finance, and strategy in the late 80s to familiarize himself more with the bean counting elements of business. Jobs spewed out all kinds of crazy and good ideas at Pixar meetings. He even tried to sell hardware, and software design via a digital animation product called Renderman but this did not sell well. In the early 1990s, John Lasseter came up with Toy Story. Originally, Woody was a nasty character (who acted like Steve Jobs) but finally they decided to change the story so that Woody was no longer a mean character, and the film was very successful after much difficulty with Disney. A Bug’s Life tells the story of an Ant with all kinds of crazy and good ideas, but he gets in trouble with the colony and he is then expelled from the colony. He goes out to find a solution to the colony’s grasshopper problem, and ends up saving the colony. It basically follows the same life pattern as Steve Jobs who was fired from Apple, only to triumphantly return.

 

Rivalry Of The Ants & Breaking With Disney:

Woody Allen’s Antz film was not a huge success but it was used to challenge the Disney production A Bug’s Life. Katzenberg (Dreamworks) wanted to copy Pixar’s Ant movie, and so Hollywood had two Ant movies being made in the same year. Katzenberg have a falling out with Disney in the mid-90s after being responsible for productions like Little Mermaid and Aladdin. Later Finding Nemo was the most popular DVD and sold $0.867 billion, and Pixar made $521 million with the showdown from Disney. Pixar was producing the films, and Disney was the distribution channel.

 

Build A Board That Cannot Operate Independently of the CEO:

During his transition into the leadership of Apple, Steve Jobs hired Larry Ellison, and other board members who were all loyal to Jobs. This would allow Jobs to take complete control over the company, and give him the breath of control needed to execute the long list of chances that were needed to fix Apple. Once the board was set, Steve Jobs become the CEO of Apple, and he took a salary of $1. The next step would be to rebuild the company. Instead of building Apple off of the divisions in a product line model used originally, with Jobs, there were to be no divisions with independent bottom-lines. Jobs wanted to have a cohesive structure so that he could directly control the company from the top down. He would be able to interact with smaller teams, who were in constant dialogue with each other rather than in painful competition against each other. Instead of a competitive bureaucratic structure where teams competed against eachother, Apple was now a heavily top-down organisation.

  Do Not Chase Profits, Chase Value:

By 1996, Apple had a 4% share of the market from a high of 16% in the late 1980s. Apple had expanded into every technology sector with a wide variety of products over the decade + that Jobs had been outcasted. John Scully did not think that high-tech could be sold to mass markets. According to Jobs, in the 1990s, Scully brought in corrupt people that wanted to make money only for themselves rather than create new ideas through Apple. Scully’s drive for profits at the cost of market share reduced Apple’s value. Apple’s decline was due to its inability to innovate in any area. The Macintosh hardly improved after Jobs had left. In one instance, Jobs was asked to autograph a late-1980s model of the Macintosh keyboard but first he insisted that the arrow keys be removed. Jobs hated the arrows on the keyboard and viewed it as an example of bad decision-making within Apple. Apple was almost sold to Sun and HP in 1996, Apple’s stock fell to $14 in 1996. In 1994, Gil Amelio became the CEO of Apple and wanted to integrate the Apple with Windows NT which would have corrupted Apple further. Amelio did not like Jobs much, and thought Jobs was trying the reality distortion field at every point of interaction.
tion. Amelio was probably right.

 

Do Not Force Other Businesses Into Your Closed System:

In 1983, Jobs loved Microsoft Excel so he made an offer to Gates. If Gates agreed to produce Excel exclusively for Apple for the first 2 years, then Jobs would shutdown his team working on BASIC, and license Gates’ BASIC. Gates accepted. This deal became a lever in future negotiations. When Jobs decided he wanted other companies to produce software for Apple, he exercised a clause in the contract with Gates so that Microsoft would not get an automatic bundling in every Macintosh sold. Instead of getting $10 per Application, per Macintosh sold, Microsoft would have to sell their products separately.

Gates knew that Jobs was good at playing fast and loose with the truth so he was not actually that upset because he then turned around, and started work on versions for IBM. Microsoft gave IBM priority, and Jobs’ decision to back out of the bundling deal was another major mistake by Jobs. When Gates and Jobs unveiled Excel, a reporter asked if Microsoft would be creating a version for IBM. Gates’ answer was “in time.” Jobs’ response was “Yes, in time, we’ll all be dead.”

apple boardHow To Save A Dying Tech Company – Fire The Board Or Resign:

In 1997, Apple was losing good people so Jobs pushed to give the best people a re-pricing of their stock options to ($13.29 per share) as Apple’s stocks were so low that they were nearly worthless. This was not considered good corporate practice. Having quality people was essential to ensure the success of the company. When the board said it would take 2 months to do a financial study, Jobs said he needed their absolute support now. His response was that he would not return on Monday if the board did not agree, Jobs needed to make thousands of decisions, and this was just one hurdle. Most of the board was happy to leave subsequently. Jobs said that the problem with Apples products was that they sucked.

Steve Jobs 1997 Insult ResponseMerge Your Venture With A Giant That You Can Take Over:

NeXT was failing and idea of being bought by Apple in 1996 was a tantalizing prospect for Steve Jobs. He wanted to get back into Apple while Larry Ellison of Oracle wanted to get more money by buying Apple outright. However, Jobs wanted the moral high ground by not making money in the process of transitioning back into Apple. In 1996, Steve Jobs negotiated with Gil Amelio the purchase starting with Apple Computer buying $12 per share for $500 million valuation of NeXT. Amelio countered with $10 per share for $400 million valuation of NeXT, and Jobs agreed as long as he received a payout in cash.

Jobs would hold 100 million in cash, and 35 million in Apple stock. Gil Amelio was not sure about giving Jobs entry into the board of Apple because of the history of 1977-85. You could say that Gil Amelio was caught in Jobs’ reality distortion field because later Amelio would realise that Jobs was positioning himself to destroy Amelio as CEO of Apple. Jobs’ return to Apple was fortuitous; if you can merge with a major company then you are effectively be hired by that company. Bill Gates said that Amelio was an idiot for bringing NeXT into Apple, and that Jobs was a salesman without an engineering understanding. An early example of the feathers that Jobs ruffled circa 1997…

 

How To Save A Dying Tech Company – Make Products Not Profit, Fundamentally:

Do not race to the bottom on prices. Get your user to have an emotional connection with the product. Amelio’s approach was to build a cheap product based on sketches of bolder ideas. Jobs believed in digging into the depth of what a product should do. You need to understand the essence of a product in order to get rid of the parts that are not fundamental. Can you get 1 part to do 4 times as much work? Design was not about surface but design is the fundamental soul of a human-made creation. A good design can be ruined by a bad factory production. Products should be pure and seamless. Do not let the engineers drive design. Apple worked the other way. Jobs found Jonathan Ive to produce the core designs at Apple going forward.

There is an Apple office that Ive’s runs which is built around models for future design to see where the products are heading, and to get a sense of the whole company on one desk. Apple has patented hundreds of devices. They built the modern Apple company around the assumption that design and product trump profits. Together Steve Jobs and Jonathan Ive produced the iMac, iPod, iPhone, iPad, PowerMac 5, iBook.

 

 

Skate Where The Puck’s Going, Not Where It’s Been:

“Skate where the pucks going, not where it’s been.” – Wayne Gretzky. Jobs believed that it was his goal to understand what the customer wants before they do. The iMac is about inspiring with a beautiful plastic blue, and it was translucent so that you could see into the machine. The casing would help to give all the components. The simplicity of the plastic shell had to be perfected, and they even studied jelly beans to see how it would be attractive. Some people at Apple wanted to conduct a study to see if the cost of the translucent casing would be justified by focus groups, Steve Jobs said no. iMac should sell for $1200, and produce an all in one consumer appliance. iMac did not include the floppy disk drive but it was ahead of its time. iMac was friendly so much so that there was a handle on the top of the iMac to actually pick it up. Jobs almost started crying because the iMac had a tray instead of a slot drive. May 1998 was the iMac launching. In 2001, iMac was changed to have a sunflower type design.

 

The Loser Now Will Be Soon To Win:

Jobs believed Amelio was a bozo. Gil Amelio did not actually present or sell himself particularly well, and he famously bombed on stage at MacWorld in 1996. That particular presentation was very poor and unplanned. Once back inside Apple, Jobs was too honest and spoke with one of the board members Willard who asked Jobs what he thought about Amelio. Jobs said that Amelio was not in the right job, and then added that Gil Amelio was the worst CEO ever. Famously, Gil Amelio had explained to a journalist that “Apple is like a ship, that ship is loaded with treasure, but there’s a hole in the ship. And my job is to get everyone to row in the same direction.” That lack of logic in this statement spoke to Amelio’s lack of efficiency as a leader.

Ellison tried to call for the drafting of Steve Jobs as CEO of Apple. When Amelio confronted Jobs about the possible takeover, Jobs denied any of it but refused to declare that he was not positioning himself for a takeover. Jobs loved to dish out flattery with Amelio, meanwhile Jobs was busy turning the board against Amelio, and Apple’s dire situation financially. People were leaving Apple, and thinking of leaving Apple which is never good when your people are an important asset. Amelio was fired because he was incompetent, but once Jobs was offered the CEO job, Steve Jobs moved into the interim CEO because he was still running Pixar. After years in the wilderness, Jobs was back at the top of Apple. The first thing he did there was to commit a subtle by significant vindictive act: Jobs hated the Newton personal assistant because you needed a stylus and also because the Newton was one major innovation of John Scully’s. Scully was the man who kicked Jobs out of Apple in 1985. Jobs cancelled the Newton.

 

The Internet Is Made For Music:

Napster, Limewire, and other music file sharing websites allowed the illegal downloading of music on a massive scale, and a precipitous decline in sales of traditional distribution platforms for music which began dropping by 9% in 1998. The executives at the music companies were desperate to agree on a common standard for copy-right protection. If the music industry could agree to the coding of music across the industry, they might be able to get a head of the Peer-to-Peers. Sony and Universal came up with Press-Play. EMI had their own system alternative, each had a subscription based system where you would rent the music, and the two competing solutions would not license each other’s songs. The interfaces were clunky, and the services were terrible, the record companies did not get how to solve the problem. Warner/Sony wanted to close a deal with Jobs, largely because Warner/Sony did not know what to do. Steve Jobs was opposed to the theft of creative products even though he bootlegged Bob Dylan in the 1970s. If people copied Apple software, there would be no incentive for new music other than from the passion of musicians.

Creative companies never get started, and it’s wrong to steal, and it hurts your own character according to Jobs. iTunes was the alternative to the brain-dead services, iTunes was the legal alternative to P2P where everyone wins: a) users would no longer steal, b) record companies generate revenue, c) artists get paid, and d) Apple disrupts the music industry. Steve Jobs had a tough pitch with record companies because of the pricing model, but he used the fact that Apple was still only 5% of the computer market to convince them that such a deal was not have a major impact oo their bottomline. So if iTunes was destructive, it would not be quite so too damaging. Apple was a closed system, and so these Record companies could use Apple as means of controlling the MP3s.

Record companies got $0.77 of the $0.99. People wanted to own music, not rent, or subscribe to it. The subscription model did not make as much sense. Record companies had made a lot of money by having artists produce two or three good songs with 10 fillers, the iTunes store would allow users to select only the songs they liked, further upsetting Record companies. Steve Jobs’ response was that piracy had already deconstructed the album. He closed deals across the music industry which was astounding. Jobs bridged the gap between technology and art.

 

Brand Yourself Differently:

Think Different – the new slogan was not perfectly grammatical if you think about what you are trying to say: it is most appropriately think differently. Steve Jobs explained that Apple’s future in 1997 was to think differently. The craziness of Apple’s customer base was that they had a sense of creativity and uniqueness that others did not. Steve Jobs argued that Apple was distinctive as a brand, and they formulated a brand image campaign to celebrate what creative people could do with their Apple computers. The Think Different campaign was about reminding themselves about who they were. Here’s to the crazy ones, who think differently. Their television commercial was historic, as well as the posters for Think Different. Jobs believed in the renegade brand that people would choose because it made them feel proud and exclusive.

 

Create Complimentary Product Offerings Without a Lead Loss Generator:

Sales of the iPod would drive sales of the iMac, and vice versa. They got a triple bang for the buck in advertising by invigorating the Apple, Mac, and iPod. Steve Jobs completely dominated the market for music players by putting all of his advertising spending on the Mac into the iPod. So the iPod advertised more aggressively at about 100 times more spend, than the closest competitor. The beautiful iPod cost $399, some people said that iPod stood for “idiots price our devices.” The iPod was about intersection between technology & arts, software & music. 

 

Don’t Be Afraid To Cannibalize Yourself Because If You Don’t Others Will:

When iTunes was released, Microsoft managers realized that they needed to create direct user value with an end to end service. Gates felt like an idiot once again, and Microsoft wanted to move forward although it was caught flat footed by Apple. So Microsoft tried to copy iTunes. When Apple created the compatible iPod, and iTunes systems for other PCs it meant that PC users would not have to buy Macs to use the iPod. Steve Jobs did not want to put iTunes on the PC. The cannibalization of not selling Macs was out weighed by the potential iPod sales. Once iPods went PC, Apple was on its way to be extremely extremely lucrative. Jobs said that iTunes for Windows was the best application for PCs ever. When Microsoft came up with Zune, it was obvious that they did not care about the music or the product. Steve Jobs believed that an iPhone might cannibalize sales for Mac, but it would not deter Jobs. When the inventor of the Walkman tried to compete against Apple, they were held back by cannibalization because Sony had a music department etc etc. In 2004, the iPod Mini was the next innovation which helped eliminated the portable music player competitions. Apple’s market share in the portable music player industry went from 35% to 75% in 18 months. The iPod Shuffle also helped grow it further because people like to be surprised. Jobs decided that they should get rid of the screen, you don’t need to navigate all you needed was to skip over the songs you heard.

 

Focus On What People Really Want…1,000 Songs:

 Jobs could not include the first CD burners in the iMac because he hated trays. The mark of an innovative company is that it knows how to leapfrog when it finds itself behind in the development of new innovation. Napster exploded in growth, the number of blank CDs sales also increased massively in 1999, and Jobs worked hard to catch-up. Steve Jobs wanted to make music management easy. You can latterly drag, and burn a CD. Jobs bought a company called SoundJam, and instead of an interface to see your songs, Jobs wanted a simple search box. In 2001, iTunes was free to all Mac users. The next step was to create a portable player which was the simple interface. Getting all the record companies alongside iTunes would be the complicated part. By the fall of 2000, Apple was working towards this goal.

Fidel and Rubenstein clashed over the iPod because Fidel was charismatic, and wanted to claim control, and he had already been shopping around other companies to pitch his idea of a portable software based device which later became the iPod. They found small company to help them with the Mp3 technology. Steve Jobs wanted white on everything for the iPod, the purity of the white headphones became iconic. Steve Jobs pushed the idea of their iconic advertising. Apple’s whole history was making the software, and hardware together so the iPod made strategic sense. Gates said it was great, too bad it was only for Macs… By 2007 iPod was half of Apple’s revenues.

 

Steve Jobs Said that Google’s ‘Don’t Be Evil Mantra’ Is *Bullshit*:

Android’s touch screen features was clearly stolen from the iPhone. They had a grid app list much like the iPhone. The swipe to open, pinch to expand, these were all Apple ideas that Google was implementing. Google was engaged in grand theft as far as Steve Jobs was concerned. Jobs went to Google, and shouted at everyone there. Jobs wanted Android to stop stealing their ideas. The open source code approach was valuable because Google was able to sell their platform to multiple mobile phone providers where Apple had more control. Nonetheless the Apple App market is much larger than the Google one to this day.

Get Yourself Into The Cloud & A Castle:

Apple’s MobileMe was a failure because it did not sync data. It was expensive but iCloud was the future. This was not a new idea. In 1997, Steve Jobs explained that at NeXT he had all of his data on the server. The idea is that you won’t have to back up your computer by downloading into the iCloud. All you stuff is on the server, Jobs was talking about this idea as early as 1997. The concept that everything would work simply has been applied to cloud computing. Microsoft said that CloudPower would allow individuals to access their content wherever they are but this opens up the door to licensing agreements etc. In a final twists, the Apple Campus is under construction and will be completed in 2015. It is similar to Google HQ. Copied?

 

Don’t Fear Changes In Industry & Anticipate Competitive Market Disruption:

The digital camera industry was destroyed by cellphones, and Steve Jobs knew that in order to stay ahead of the wave, they would have to cover the cellphone market as well. The iPhone was born out of a concern that Nokia et al would eat Apple’s lunch by creating mobile photos that could easily play music, just as Nokia et al had crushed Kodak. Motorola was a stupid company to Jobs because the Rokr was a joke. Jobs realized that the iPod wheel was not going to dial phone numbers. Jobs was working on the iPad with the touch screen system before the birth of the iPhone. The ability to process multiple touch items was Steve Jobs’ ideas. They wanted to transfer the track pad to the computer screen. Ive never made a demonstration with other people because he know Jobs would shoot it down. The tablet development was put on hold, and shifted to the iPhone screen. Jobs split the multi touch track pads and wheel based iPhone plans. The case could not be opened, and Apple made sure that people could not access the iPhone. The iPhone was three products bundled into one: 1) internet interface, 2) mobile phone, and 3) touch controls. The iPhone was a massively successful product even though it was the most expensive phone in the world $500. Ballmer said the iPhone sucked because business people want a keyboard. Apple sold 90 million phones within months.

 

Create An Inventory Management System & Build Stores That Work:

Everything you do incorrectly is in order to get it right. If something isn’t right you can’t fix it later. Steve Jobs wanted to control the customer experience, which included the experience of creating wood, stone, steel, and glass an Apple store. Mega chains were where the salesman did not care about Apple because other products were available. Jobs was impressed by the Gap store business, and Jobs hired Drexler from Gap to build a prototype of the store. Tim Cook, reduced key suppliers from 120 to 24, forced many to move closed to Apple’s plants. He helped save Apple a great deal of money. Apple stores were strategically placed in Covent Garden London, or in New York. Sales are quickly tabulated using Oracle technology every 4 minutes so that they have a lean manufacturing production line, and the building of products can respond to market demand quickly.

 

Converge Old Devices Into 1 New Device:

Is there room for something in the middle of the iPhone and PC, Jobs asked in 2010? The iPad allows people to bring technologies together. The iPad was not sold as well as the iPhone. The name iPad was ridiculed as a women’s hygiene product. Gates still believed that it’s a nice reader but didn’t like the iPad. Further divergence in views suggests that Gates believed in a stylus while Jobs said we already have 10 stylus’. There were 800 emails in Steve Jobs’ inbox. The iPad had the limitation that it was for consumers but does not facilitate creation. The iPad arguably mutes the user turning you back into a passive observer. The question about iPad was whether it should be closed. Google’s Android was an open platform that could be used openly. The iPad was the clearest test of the closed-system model versus the open-system model. In the end, iPad was the most successful consumer product launch in history with 1 million sold in the first month. Jobs was in the process of changing the print industry, he closed deals like he did with the music industry. Apple would take a 30% take of the subscriptions sold, and Apple would have all of their purchase information which they would use later on. The problem was the publishing industry did not want the subscription base to be controlled by Apple since Apple would then change the prices. Steve Jobs believed that the paper textbook was going to be a industry ripe for digital destruction, and created digital versions of the products. The Chinese employees are paid $2.00 per day. It takes 5 days, and 3500 hands to produce 1 iPad in Foxconn China.

Do Not Ignore Medical Diagnoses:

When Jobs was diagnosed with cancer, he did not rush to have surgery to remove the tumour found in his pancreas. Instead, he tried to see if other treatments would work. Why was he hesitant? Partly because he had difficulty with the idea of opening up his body. He went under herbal remedies and psychic treatments as a result of his quibbling. As a response to his psychological concerns, Steve Jobs tried to cure himself in strange ways: reality is unforgiving. Once again, he was able to filter out the world, and ignore stuff that he does not want to confront. Jobs had been rewarded for willing things away, but in July 2004, the cancer had spread. Finally, he underwent surgery in 2004 but a less radical surgery.

The cancer had spread into the liver. Had doctors operated 9 months earlier they would have possibly arrested it. When he had a liver transplant in 2009 by going to another state and by having a multiple listing, the liver Jobs received was the product of a car accident that killed a 25 year old. Steve Jobs lied about his condition throughout the last years of his life by calling it a hormone imbalance. The privacy rights of the CEO had to be weighed, but Jobs also embodied his company more than most CEOs so the impact of negative news regarding his health could have an impact on the stock.

Make Peace With Your Old Enemies:

Microsoft had stolen the interface developed by Apple with multiple clip windows etc. IN 1997 Jobs announced that the only way forward was to make a deal with Bill Gates and Microsoft. In 2007, Bill Gates and Steve Jobs got together to talk about technology. It is an EPIC discussion.

Follow Your Heart:

there is no reason to not follow your heart, and gain meaning because you will be dead one day. Don’t live someone else’s dream. Stay hungry, stay foolish. The Stanford University commencement address is considered one of the greatest commencement ever made.Jobs did not believe that people should be materialistic but should seek to be valuable.

Steve Jobs Was A Brilliant Jerk

From the creator of Going Clear, Steve Jobs: The Man In The Machine is about the now infamous career flaws of one of the most successfull entrepreneurs in American history. It looks like a good rehashing of memories from 2012 when everyone you knew + your grandma read the Isaacson’s biography.  I’m certain Kutcher and the script writers of the disappointing Jobs film are going to have a front row seat as they didn’t actually read the Isaacson biography….’cause that film sucked badly.

Steve Jobs:
  • a) abandoned his own daughter and girlfriend,
  • b) cheated Wozniak out of a bonus at Atari,
  • c) verbally assaulted the LISA team and created intense competition between teams,
  • d) screamed at Macintosh developers regularly,
  • e) cried like a baby when the iMac CD tray was a tray not a slot,
  • f) fired employees with retroactive consequences to their salary,
  • g) parked his car in the handicap spot,
  • h) sped down the highway regularly,
  • i) discovered his Syrian father (who also abandoned him) was the owner of the restaurant chain he frequented regularly but never came by to say “hi”,
  • j) tried to instigate a coup against foolish management and lost…
  • k) cried whenever someone disagreed with him,
  • l) attacked creative ideas for being idiotic then within a week apprioriated them as his own,
  • m) called his co-workers idiots and bozos whenever they fell short of his goals,
  • n) his colleagues had to hide a disc drive developer in the Macintosh supply closet (whenever Jobs visited) in order to prevent Jobs from discovering a parallel disc drive solution was being built which ultimately saved Jobs from disaster as his solution failed,
  • o) he refused to donate to any charity ever,
  • p) built and painted an expensive factory at NExT meanwhile the product completely bombed,
  • q) refused to give shares to one of his earliest Apple colleagues even though the guy put in many hours into the project and begged Jobs for a small part of the equity,
  • r) made his step-mom answer early customer service calls to Apple without pay (laugh out loud)….
  • s) took the tv away from his step-dad who wanted to watch football in order to program Apple’s……
  • t) declared war on IBM as a means of galvanising his company,
  • u) claimed Microsoft was stealing Apple’s ideas when both actually stole from Xerox PARC,
  • v) tried to destroy Adobe and any organisation that expected fair treatment…

This list is not exhaustive & what can we learn from this list, right?

This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.

Phil Knight | ShoeDog (Everything You Need to Know) 1968 – to the End of the Book

1968 – A synopsis

This chapter begins with the author deliberating about leaving his cushy job at Price Waterhouse to be able to devote more time to Blue Ribbon. However, financially, it wasn’t possible to just work at Blue Ribbon. So he decides to become an assistant professor at Portland State University, which will allow him to earn his sustenance as well as have more time for his company. His senior at Price Waterhouse and his father both are baffled at his decision to quit his job.

This is where the story of how he meets his future wife begins. She is a student who looks different than everyone else and diverts his attention by sitting in the first row. Penelope Parks never participates in class discussions (which the author makes lively by using the Socratic method), but ends up surprising the author by getting the topmost grades in her assignments.

He eventually asks her if she would be interested in doing accounting work for his company, and she acquiesces. She soon becomes indispensable, both from a professional as well as a human relations point of view. The author one day finds that she has kept all her salary cheques uncashed in her drawer, and this is what perhaps gives him the courage to ask her out on a date. They go to the zoo where he tells her more about himself, his travels around the world and his dream for his company. She is suitably impressed as she has only dated ‘boys’ who are interested in sports and cars.

They go on a couple more dates, and become more comfortable with each other. They end up meeting each other’s parents, and discover that their homes are as different as possible. The author’s parents are polite but insist on knowing more about her. Parks’ home, in contrast, is rowdy and in disorder. The author eventually connects with Penelope’s mother, who begins to like him.

With things going smoothly at the office and at home and Penelope spending increasingly more time with the author, he asks her mother permission to take her away for a weekend with him. She refuses the first time, but the author uses his negotiation skills to get her to agree the second time round.

The trip is successful and ends with the couple very matter-of-factly deciding about their upcoming marriage.

This chapter also deals with the author’s observations on Japan and its culture. He openly admires their way of doing things, their shyness and his growing camaraderie with Kitami, who invites him to his department’s annual picnic.

An important incident here that highlights the author’s character is his sending fifty dollars to a man in Japan who lost his home and bicycle in a typhoon. The author has just met and conversed with this man once, yet considered it important enough to help him out. The man replies saying he can’t accept the money as per the instructions of his superiors, but cleverly adds a postscript saying that if the author instead sends the money to his home address, he will be able to take it. The author does so.

1969 – A Synopsis

Now that the company is running in a stable manner with regards to steady sales, attention is drawn to other important factors like advertising, athletic endorsements etc. Knight recruits a broke art student for painting advertisements when he realizes how behind they are in that field.

Mention is also made to the historic moment when two athletes, John Carlos and Tommy Smith, raised a protest at the Olympics as a protest. Knight mentions that Bowerman naturally supported them, because he would support all runners. This adds to the facet of Bowerman’s personality revealed before – of putting running before everything. Not only is it above business (he never mentions his company in his book), but it is also above his beliefs, whether racial or otherwise, at the time. He supports his runners simply because they are that.

Knight’s naiveté is also shows in this chapter when he openly puts in a mail to all his employees saying he has his own spy working on Kitmami. He is also revealed to be a difficult person to live with, absentminded, a bad driver, not neat and spoiled in the sense that he is unable to take care of himself. His wife lovingly puts up with all of it. However, when she gets pregnant and they buy a house and Knight makes it clear that the house will be taken away if the company goes under, a major development in her character is reflected.

Knight also mistakenly takes a harder than necessary stance with an employee who is overburdened with work and wants a raise and is starting to detest Knight’s offhand management style. Woodell helps patch this trouble over by staying with the employee for a few days and effectively bonding with him.

She has always been shown as a diligent person who becomes indispensible to the office, but now, she works harder than ever before even when she is pregnant. Her fear of not having stability drives her more than anything else. She fills out uncertain and badly drawn orders, keeping up sales numbers through her days of morning sickness and bodily weight gain. She is a stellar character who rises up to the challenges of Knight’s life.

The relationship between Woodell and Knight also develops. This is the first time that Knight speaks of someone with such fond remembrance that one can detect a yearning of nostalgia for times spent with Woodell. Woodell is an inspiration and much more self-reliant than most fully-abled men. He abhors pity and is dedicated to his work. He quickly becomes a very important part of the Knights’ lives, both professionally and personally.

Knight also reaches another key point in his life – he becomes a father. He is both scared but mostly wondrous at the feeling of having created his own baby with his wife when he first holds the baby. He is ecstatic, and the first thought that comes into his mind is to find his father and tell him the news.

1970 – A Synopsis

This is the point when Knight faces many challenges, including one in his personal life. The gamut of challenges starts with a meeting for contract renewal in Japan that goes well but leaves him in doubt nevertheless. Simultaneously, orders start coming in an even worse manner – earlier, they used to be merely late, now they are the wrong models as well the wrong sizes. Customers start getting frustrated in large numbers. Of course, the company understands that they are first fulfilling their demand in Japan and then sending the leftovers to America.

Next, Knight gets told by his banker that there will be no money given to him any longer, and to return the money he already owes, he must fulfill strict sales quotas set by the bank. Here, for the first time, Japan offers to send the shipment on time – just when the bank has backed out. Knight comes up with the idea of a small public offering.

When this public offering disastrously fails, however, it leaves Knight’s confidence in his life’s work shattered. He is left questioning himself. Although he blames various things for it (Vietnam, the depression) he is ultimately racked with humiliation at having thought too much of something that clearly was not. Still struggling, Knight struggles to find money so badly that he accepts the last life savings of Woodell’s parents.

To continue the downward spiral, Knight also loses the physical agility which he was so proud of. Having gained weight, he could no longer run the way he used to. It all comes down to one humiliating moment when Knight cannot keep up with Grelle in a private run. But this serves as a springboard, and Knight begins to shed the extra kilos.

He trains hard, comes back and beats Grelle in a running bet. This is perhaps the beginning of better days, because Knight finds out about Japanese trading companies, who like to extend lines of credit to fledgling companies. This provides Knight an option after the bank debacle. But he is careful, and takes time to decide.

He discovers some disturbing news – his doubts in the meeting in Japan were correct, after all – Kitami is shopping for another US dealer. This is when he makes the strategic decision of inviting Kitami to his country and his home.

There is a subtle link between the physical fitness of Knight and his ability to keep his company running. This is perhaps because in the past chapters he has always used running as something to soothe him, or calm him down, or even blow off steam – he has gone on a run before big deals or before big decisions, often feeling better afterwards. His lack of physical fitness came as a realization to him at a particularly low point professionally. But once he overcomes that and goes back to his previous weight and is able to proudly run again, even bigger problems than before seem easier to resolve.

1971 – A Synopsis

This chapter is whirlwind of ups and down, and reveals the character of the mysterious Mr. Kitami at length. While the Knights make his and his assistant’s American visit as hospitable as possible, Kitmami blows over reactions at the bank by outright demanding them to give Blue Ribbon money.

Knight is shocked, but catches the smug expression of Kitami as they exit the bank, understanding that Kitami is trying to sabotage this deal in more ways than one. Kitami continues this irritable behaviour at the new offices, refusing to acknowledge the steady double growth as a good thing, demanding more.

Here is where a side of Knight previously unseen is discovered. On continuously hearing that their growth should be triple through reference to a folder, Knight becomes curious and pilfers the folder from Kitmani’s belongings. Shocked at himself, he confides in Woodell, who is shocked as well, but wants to analyze the contents nevertheless. Here it is evident that although both men have a good conscience, yet when it comes to their business, there are some lines that they wouldn’t mind crossing.

Kitami’s unforgivable behaviour continues when he leaves Jenny alone to fix a flat tyre on the highway, himself just sitting in the car. Things continue to go downhill at a get-together at the Bowermans’, where Mrs. Bowerman has allowed alcohol when she generally doesn’t. Tensions are already high due to the war, and Mr. Bowerman gets really tipsy and makes the environment uncomfortable. The weird night ends with Kitami playing songs on a guitar, making everyone fall into silence.

For the first time, Bowerman’s goofy side is shown. He is always the quiet, resilient and diligent person in the background, but at this get-together, he does not mind being the verbose centre of attention. Perhaps it was this effect of alcohol that made Mrs. Bowerman forbid any alcohol in the house.

After Kitami ends his visit by proposing buying out Blue Ribbon, Knight is forced to come up with a strategy to save his company and turns back to the Japanese trading company, which helps him meet a genius show creator’s student.

One of the most historic moments of the story also fall within this chapter – the naming of the brand as Nike. After thinking of various names that the employees could not agree on, the name Nike is decided in desperation, and so is a symbol resembling a swoosh of air.

After trying out various factories, Knight also finds a dream factory that manufactures shoes to his satisfaction. Although he finds a few faults, overall, the quality control and the manufacturing speed are above reproach. He ends up naming the rest of the models in a fit of exuberance, and feels victorious afterwards. That feeling of victory is similar to how he felt when his son was born – the words ‘we made this’ are common in both situations.

This chapter is important not only because of the beginning of the evolving of the company as it is popularly known, but also delving into aspects of personality of the characters previously unexplored.

1972 – A Synopsis

This chapter focuses on how the company starts shaping its own unique identity. Till now, Knight and his people have been working hard, yes, but they have always been controlled by someone else. Although Japan’s support was important in the initial stages, this chapter shows how the company has grown strong enough to throw away the shackles and follow their own path.

This happens when Kitami walks into one of the shoe stores and finds boxes upon boxes of Nike shoes stacked in the back. Thus follows a meeting where both sides threaten each other with lawsuits, and their business connection is terminated. Knight, in this chapter, shows the true qualities of a leader. Till now, although effective, there hasn’t been much evidence of Knight encouraging people, as he prefers not to be the hands-on type of leader. In the meeting after this incident, however, Knight single-handedly converts the defeat and pessimism in everyone’s body language to hope and an eagerness for success. The story after this almost feels destines for success.

The rest of the chapter deals with Nike and how it gets itself into the endorsement business. It begins with the National Sporting Goods Association Show, where despite having mediocre product the company manages to exceed all of their collective order expectations. In disbelief, when asked why they were ordering the product at all, the salesmen confess that they know that this company always tells the truth. Although bewildered that such a simple thing could be behind this success, the answer sticks with Knight.

The company also meets with good success at the Olympic field and track trials, where they get athletes to wear their apparel and their shoes. They eventually end up signing a deal for ten thousand dollars with Ilie ‘Nasty’ Nastase.

To top it all off, the University of Oregon Ducks unexpectedly win, and they do so wearing Nike waffles. Knight is ecstatic because it is a double whammy – his team is winning, and it is doing so wearing his product.

In this chapter, Knight also consciously or subconsciously reveals that this is the turning point from which there is no return. Till before this, Knight’s mindset has always been that if the business fails, it had better fail fast, because then he can get out young. But here, after witnessing the legendary win of Prefontaine and the emerging of the Ducks as winner, it is clear that Knight loves sports so much they are a part of who he is as a person, and he will never be truly able to turn back.

Finally, Bowerman reveals another facet of this character, which comes as a big surprise. After a shocking disaster where eleven Israeli athletes are kidnapped and killed, Bowerman is irrevocably shaken, and resigns from coaching a few days after. This is the first time Bowerman is shown in a defeatist stance.

Overall, the tone of the chapter is promising, and everything is going good for Knight. It seems there is nowhere to go but up.

1973 – A Synopsis

Problems have started cropping up – and not just for Knight. Pre, the star of the last chapter, finishes fourth in the Olympic finals. His financial condition also takes a turn for the worse because Olympic athletes weren’t allowed to collect endorsement money. Knight eventually decides to hire him and use him to spread the word about Nike.

Pre’s personality takes up a lot of the chapter. He is the sort of person people automatically become intimidated by when he walks into a room. The ice eventually breaks over a meal when everyone realizes how Pre is just like them.

Knight takes another important managerial decision – he gets Woodell and Johnson to switch cities. This is difficult because both of them have settled well in the cities they already are in, but Knight convinces them to do it.

One of the most painful moments yet is chronicled in this chapter. Knight meets with his debenture holders after posting a loss, and trying to answer their questions is very difficult for him. Staring up at him are working class faces who put their faith in him, and then and there, Knight decides that he will never take his company public – if facing a few debenture holders could make him feel so bad, what would thousand of shareholders do for him? He placates the debenture holders by telling them that he would keep the conversion rate the same for all the five years (when originally it was supposed to increase each year).

A suit is filed against the company in Japan, and they sue back with the help of Knight’s cousin, Houser. Houser is tenacious and competitive, and plays well in front of a judge or a jury. Knight feels drained because of the depositions he has to go through, where various questions are asked of him just to somehow get him to accept breaking the contract. His father provides him valuable support during this time, both familial and legal. Having such a focused thing to concentrate on gives his father a mission too.

A new law graduate, Rob Strasser, is added to the legal team, and he and Knight hit it off. They bond over work, over sports and over having similar fathers. Strasser also fully believes in the company’s cause.

Meanwhile, Penny is about to have another child. Knight is worried about supporting two children financially. However, after the child is safely delivered, Knight’s mind returns to his business, and Penny can feel it. Although Knight realizes that what he did wasn’t something he should have done, he doesn’t stop himself. Neither does Penny. It is amply clear that she understands him and his state of mind completely.

Knight starts a completely new system that picks up pace with the shoe suppliers for solving the problem of demand and supply. He asks for bulk non refundable orders six months in advance. Although he faces resistance in the beginning, by the end of it, the people who aren’t included beg to be let in.

1974 – A Synopsis

This chapter is a finger-biting account of the entire trial. It is described so well that the tension is palpable. Everything that could have gone splendidly right goes wrong in one way or another. Knight’s nerves are on edge after the countless question in the deposition, and he makes the mistake of not being well rested or well fed before coming to court. He breaks under pressure, often becoming incoherent.

Other witnesses don’t do too well too. Bowerman refuses to prepare for his testimony because of his deep disdain for the Japanese business and ends up getting intimidated on the stand, and Woodell gets so nervous he starts giggling while spelling his name for the judge. After the judge passes a gag order forbidding both of the sides to talk about the trial, the very next day, Johnson speaks to a salesperson who turns up in the court with the defense team. Overall, the case looks like a wreck. But amidst all of this chaos, Knight manages to convey the unstoppable belief that he has in his cousin – and it seems the cousin is the only one who does not in some way contribute to the worsening of the case.

The judge himself is a character whose different sides are revealed throughout the chapter. Increasingly dramatic and at first appearing very stern, it is later revealed that under all the dramatic announcements, he is a logical person who is simply making the most of a case that he doesn’t particularly like. His judgment finds in favor of Blue Ribbon simply because he finds that side most truthful – and it is shown how the judge is a very astute observer because he notices things like Kitami getting a translator but correcting him in perfect English when he makes a mistake translating.

This chapter is extremely well worded – throughout the proceedings, it seems that Knight and his company will lose, but when the point of ruling actually comes about, there isn’t incredulous surprise at them winning. The feeling of joy afterwards is very well captured, and Knight especially gets carried away with the feeling of victory. The other side however does not render the cheque immediately as per their settlement agreement. Another great victory is Jimmy Connors surprisingly winning the Wimbeldon and the US Open, both in Nikes.

Another important part of the chapter is Knight trying to recruit Strasser. Till now, Knight has never actually prepared a speech or arguments to try to hire someone. But he knows how valuable Strasser can be – and knows that Strasser too would love to work with Blue Ribbon. Eventually, Strasser’s only problem turns out to be getting his father’s permission – something Knight hasn’t prepared for. But that works out for the best and Strasser becomes the company’s first in-house counsel. It is clear that this is the bedrock of a relationship that is going to last for a long time. The number of similarities in their personal lives is already quite great, and now they are beginning a professional relationship too. As we see Bowerman becoming less and less focused, Strasser’s involvement simultaneously grows along side.

1975 – A Synopsis

This is where all the financial problems come to a head – there come a point when the company is unable to pay Nissho, the salary cheques of the employees bounce, the bank refuses to associate with them anymore, an FBI investigation is prompted by the bank, angry creditors fly down to demand their money, all the while when the person from Nissho who was dealing with Blue Ribbon – the friendly Sumeragi – is replaced by a higher-up, Ito, who is so cold that Knight starts referring to him as the Ice Man.

Through all the troubles that emerge, the characters of three people come out through and through – Ito, Knight and Giampietro, the man Knight had hired for managing the shoe factory.

Giampietro gets the company out of a huge fix in a very unconventional manner. When the cheques bounce and the angry employees swarm around Johnson, Giampietro drives around to the owner of a local box company, demanding a loan of five thousand dollars. It is a mark of Giampietro’s personality that he actually gets the loan. He then hands out crisp notes to the employees, staving off one disaster.

The entire bank situation gets out of hand with the FBI potentially getting involved. Knight informs Nissho of the situation, preferring to be truthful. He also asks for a further loan of a million dollars to hold everybody else off. Ito demands to see the books before he makes a decision. This is a warning sign because Knight used the money from Nissho to build the factory – and Nissho had no idea about it. Knight spends a sleepless night, only to see that Ito handles it way better than Knight could ever have imagined.

Ito comes out as a sterling character who believes in Knight. Singly handedly, after knowing the exact circumstances, he visits the bank and shuts up their threats forever. He pays off the remaining debt and tells the bank that they can stop hoping to get business with Nissho from now. Knight is delighted and relieved in equal measures.

The creditors are handles in an almost funny way – it would be hilarious if it weren’t so desperate – as Knight assigns a person to each creditor to make sure that they don’t bump into each other inside the building. A third person manages the movements and warns the handlers about the creditors. Knight jumps in and talks to the disgruntled creditors and manages to save the day for the time being.

The chapter ends on a positive note, a much more positive place than could have been expected with the way the financial state of things were. It is clear that Nissho is in with Blue Ribbon for the long haul. It becomes apparent again, that like at the time of the courtroom troubles, it is truth and straightforwardness that saved Knight and his company this time too.

Penny, once again, displays her faith in Blue Ribbon and gives Knight a positive assessment to rely on in times of intense stress.

Part two, 1975 – A Synopsis

This is a very short, very sad chapter. Everything upto this point has been a description of Knight’s struggles with his identity (at first), and then the troubles of getting his business set up. Much of the other parts of Knight’s life – like, death, which everyone deals with – has not come in a large enough form for it to have affected him majorly. This chapter shows how the major characters deal with such a crisis.

The chapter begins quite happily – Blue Ribbon has come out of all the trouble, but they still lack a bank. After trying a number of them, they end up finally getting a bank who is ready to take them on – the First State Bank of Oregon, in Milwaukie. Knight is finally relieved and gets a good night’s sleep after weeks.

The Memorial Day weekend is coming up, and Penny wants to get away, and so does Knight. But as has been shown before, Knight loves to mix business with pleasure – and so he proposes going to Pre’s weekend meet, where he has invited a mix of some of the best runners in the world. The weekend promises to be fun and exciting.

Seeing Pre running inspires Knight, as usual. There is something different this time – Pre is not at his best, and everyone can see it, yet he puts in all he has in the last two hundred yards and wins. Knight recalls Pre’s famous saying, ‘Somebody may beat me – but they’re going to have to bleed to do it’, and vows to apply it in his professional life.

After the Knights drive back home after a good day, Phil receives a call just before dawn Ed Campbell over at the Bank of California, telling him that Pre is dead. Phil is shocked and can’t believe it, and tries to confirm the story. It is indeed true – Pre died in a car accident last night.

Pre’s death is heartbreaking particularly because he was so young. Knight compares it to his age – when he was twenty four, he had hardly lived life. Pre was already world famous and had so much to do. Bowerman is particularly broken down about Pre’s death, having been his coach through tough times, and having also survived the attack on Israelis at the time of the Olympics. Bowerman gives a beautiful eulogy, but look completely spent thereafter. Having been an unstoppable force, it looks like Bowerman is finally slowing down, and this may be a hit from which he may never recover.

Pre was a beloved athlete, and people start leaving gifts at the place he died – flowers, letters, notes, even Nikes. Knight and the rest of Blue Ribbon decide that they will collect everything and build a shrine for Pre, because he deserves that. They have no idea how they will be able to collect the money for this sort of a thing, but Woodell and Knight agree that as long as they are in business, they will somehow find the money for things that matter the most.

1976 – A Synopsis

Going public is the question that is raised multiple times, and is rejected everytime. It is not just because Knight is afraid of becoming answerable to shareholders – it is because it will change the entire culture of the company.

Bowerman finally snaps. First, he refuses to give a personal guarantee on a loan for the company, and then asks Knight to buy his share at a reduced price. Knight pleads with him to stay on and retain a small percentage. Later, Bowerman calls a meeting and tries to pick up a fight where there is no basis for one. It is clear – he isn’t happy, and he doesn’t feel involved.

Nike, meanwhile, brings about a new revolution by changing the color of their most popular pair of shoes to blue, so that they go well with jeans. Till now, no shoes company had been able to massively breakthrough into the everyday wear market, and almost overnight Nike cracked the code.

For solving the factory problem, Knight selects Gorman and takes him to Taiwan with him to give him a refresher course of Asia. Here, Knight fulfills one of his earliest wishes – he goes and lives in a suite he could not afford at the time of his student world tour. This shows how far he has come from then. People also appreciate Nike at the trials, and Knight overhears a statement that says Nike is really beating Adidas.

Nike gets a huge victory when at the Olympic trials, most unexpectedly, the three men wearing Nikes all end up crossing the victory line first. Flushed with success, they hope for a Nike Olympic winner, knowing that this is the most legitimate way for a shoe company to show that it is truly in the game. However, as the competitor’s shoes are shows, it is revealed that Shorter is actually wearing Tigers. This is the defining moment when Knight realizes how invested he is in his Nikes – he is not making Nikes, the Nikes are making him.

This chapter very candidly shares the kind of work culture Nike had at the time. Their annual retreat is called Buttface – and even though they are posting millions in sales there is nothing formal or corporate about this retreat. Ideas are discussed and dismissed in raucous voices, peppered with appropriate insults. No one is out of reach of the insults, including Knight himself. Knight feels brotherly love and loyalty for his entire team and knows that they will face the world together.

Meanwhile, Knight’s family life is suffering as he is spending less and less time with his friends. He ruefully admits that this is not a problem he can solve with the help of his friends and his team. He questions his parenting style – which is also his leadership style, i.e. not being hands on – and wonders if it is wrong or right. As a parent, one of his boys is perpetually frustrated with him because he doesn’t have enough time for the family; while the other boy adores him no matter what.

1977 – A Synopsis

Nike is now moving forward in two aspects – innovation and advertising. Both of these are giving it the kind of momentum that has begun to scare the big players like Adidas and Converse. Knight meets Rudy and Bogert, who bring with them the crazy sounding idea of using air bubbles in shoes soles. While skeptical at first, Knight thinks the idea has potential when he tries it out. On the other hand, Bowerman comes up with an idea that ends up causing injuries to people. Though the people do not lash back, Bowerman becomes dejected. Knight tries to console him, but what actually works in the end is his competitive spirit – when he comes to know the new air sole idea.

Knight starts focusing on college teams and getting them to wear Nikes. Strasser proves more invaluable than ever, because he shows himself to be a great negotiator. For the third time in this story, honesty is what leads them to what they want.

Nike becomes popular not only because of sportsmen wearing their shoes, but because of the relentless efforts of one of the guys on the team handing out Nikes to anyone and everyone on Hollywood. Appearance in a couple of very famous shows ensures that those models sell out like hot cakes.

Knight still is skeptical of the reach of advertising, although he loves the new campaign.

The question of going public comes up again, and this time Knight cannot evade it. He realizes that it is inevitable, and so puts it to a vote. The answer is inconclusive. While still going through this mental upheaval, Knight gets a letter from the Customs Service saying his company owes them twenty five million dollars. This is the result of lobbying from competitor companies and the use of an archaic law. Knight decides he has no other option than to hit back with all he has got because it is financially impossible to pay such a sum, and then continue to pay at this rate.

Knight’s frustration and anger are highlighted like never before. Earlier, he has been in tough situations but he is never portrayed as particularly aggressive. In this situation, he ends up mashing his phone to a pulp thrice.

Meanwhile, with sales climbing, the Knights decide to buy a new home. Although emotional about leaving the one in which their kids grew up behind, they decide they need more space, and they can definitely afford it. Knight’s struggle with fatherhood continues. He begins to rectify his lack of presence by being available for all weekend games and sports that his kids participate in. He soon realizes that Matthew isn’t really interested in sports. Unfortunately, this effect rubs off on Travis as well, who is actually quite talented in this matter.

Knight feels let down by his kids, because sports are such an integral part of his life. It isn’t just that he mentions Nike as his third child, it is also that he has seen life through sports metaphors, and has climbed out of the most difficult times in his life by simply going for a run.

1978 – A Synopsis

Strasser is once again ready to defend Nike against injustice, but both Strasser and Knight are aware of the fact that he can’t on the US Government alone – they would need help. Enter Werschkul. Werschkul is an eccentric but extremely intelligent person whose job is to move to Washington DC and help sort the case out. Though starting out very well, Werschkul eventually loses his mental balance working over the project, and Knight decides he himself will have to head to Washington.

Nike suffers through a major failure. The Tailwind is released – the new shoe with twelve new innovations including air in the soles! It gets sold out faster than any other model, but soon there are serious complaints and the company has to issue a recall and refunds. This hits everyone hard, particularly Strasser. The overall mood at the company seems pessimistic, even as they try to console themselves. The only person who seems to have achieved something positive out of this entire episode is Bowerman – he seems to have come out of his slump at this news.

Knight also decides to start a line of apparel because that would give Nike more respectability and diversification. Till now, Knight has made sound choices about his staff and their positions. This is when he makes a major mistake for the first time – he hires Nelson as head of the apparel department, and realizes later how unfashionable Nelson is. It is too late to make a change, however.

Nike moves out into new offices, and Knight notices the fact that his team looks eccentric and underdressed at best and ridiculous at worst. He institutes a dress code, which is met by rebellion. Sticking to his guns, he starts religiously fining anyone who doesn’t follow the letter as well as the spirit of the dress code.

Eventually, as Nelson comes out with a disastrous result (as was expected), though horrific, the situation is so hilarious that it breaks the tension for everyone involved, including Knight. Knight then puts Woodell in charge of the apparel line, and competen as ever, Woodell churns out a brilliant result.

Knight also reflects on the fact that he is steadily approaching burnout at a time when he is facing one of the biggest problems facing his company. He sits in his office – in his new chair that his designer has fashioned like a baseball mitt – and instead of appreciating himself and his team for having come thus far, can only see the problems looming in the distance.

Knight’s faith in Woodell has always been a salient point of the story, but is outright stated in this chapter when Knight wonders if he should just make Woodell do every job including his own, since he does everything so well. Knight is not looking forward to going to Washington but realizes it is something important, and deserves the best he can do. He also thinks that maybe the only way out of a potential burnout situation is to work harder.

1979 – A Synopsis

Finally in Washington, Knight tries to logically argue with the Customs official, but there is nothing which seems to move him – flattery, appeals, the American spirit, the truth, nothing. Knight has support from the treasury department, but he simply waves it off saying the Treasury department’s memo isn’t binding on Customs.

Knight now realizes what a difficult time Wershckul was having. Knight keeps on commuting to Washington, meeting with important people and trying his best to get ahead of the situation. Finally, it seems a good opportunity is at hand when they secure a meeting with Senator Hatfield. They spend a considerable time going over every possible argument and every possible counter argument. Knight is extremely worried about the meeting, and is so nervous that he gets extremely sweat before the meeting. His chief worry is that if they are not able to convince him, they may not get another chance.

Finally, when they meet the senator, he needs no convincing – he directly tells them he knows of their situation, and what can he do to help? Both of them clash on this and can’t decide, because they aren’t ready with an answer – they didn’t expect the Senator to already be on their side. Knight says they will get back to him soon.

The efforts finally pay off and the bureaucrat is under increased pressure to stop pressurizing Nike to pay. Knight derives a certain satisfaction at getting back at the bureaucrat (whom he refers to as a bureau-kraken).

Nike does a tremendous job at the new retail space they open in Portland. There are long lines and people want to try out everything that is available. There is so much pressure that even Knight helps out. He realizes why it is so important to carry on, no matter what – this is what the company is, and he has to keep fighting to keep it this way. The Nike office also shifts again, this time to a huge forty six thousand square foot building, complete with a steam room, a library, a gym and endless conference rooms. Knight consciously leaves behind the baseball mitt chair. He, however, does not feel a sense of victory as he should, seeing his team shifting into bigger offices. He is still worried about all of it being taken away any day now, and with that worry over his head, is unable to enjoy what should have normally been a great win.

The problems that the company was facing in Japan begin to narrow down in Taiwan as well. Knight knows that it is inevitable that he will have to move to China. He reaches out to David Chang, who is supposedly the best expert on the country. Chang presses all the wrong buttons at the company. He makes a fat joke after meeting Hayes, Strasser and Jim Manns, the new CFO; and mistakenly assumes Woodell is temporarily in his wheelchair and asks him when he is getting out of it. Knight optimistically tells him that there is nowhere to go now but up.

1980 – A Synopsis

Two things happen in this chapter that changed the course of history – Nike entering China, and going public.

Knight and his company are told that things are done differently in China – they have to be issued an invitation to be able to go to the country and start talking about business. So they send a very lengthy formal request on Cheng’s advice, and hope for the best. Fortunately, they get a positive reply.

Knight is really keyed up about this and wants to do everything right. He makes himself and his entire team who is going to go with him read up on China, its traditions, customs etc. He also decides to stop in Japan before going to China, to give everyone else a chance to acclimatize themselves to Asia. The meetings go really well, although they find that the factories and the shoe market in China is pathetically underdeveloped.

They solve the Customs problem once and for all by playing by the same rule that is being forced on them – they manufacture a very cheap shoe, so customs calculations would have to be based on that. Secondly, they start a TV commercial sympathetically telling the story of a hardworking Oregon company who is forced to fight with the big bad government. This gains traction among the public.

As a masterstroke, they file a suit against the government. Finally, the bureaucrat gives in. However, Knight is in no mood for a quick settlement. He refuses to pay a single penny. Over time, he is convinced by everyone around his that this is the best course of action to take, and settles for nine million. There is a moment as he signs the cheque when he reflects how far he has come from times when he could not pay a million dollars in debt without fear of the cheque bouncing.

Knight’s primary problem with going public is the lack of control, and so when he is told that there is a way to go public without losing control, he is all for it. His team agrees. They work on the process – hiring a law firm, preparing a prospectus, meeting with various important people on Wall Street, debating about the price. It is the latter which causes much argument. The law firm is not ready to take the price above twenty one a share, and Knight is determined to have it at twenty two. He believes they are worth that much, and there is another company called Apple that is going public at the same time, at that price too.

After everything is settled, instead of feeling an overwhelming feeling of victory, Knight is surprised that he feels regret – he wishes he could do it all over again. Throughout the going public process, he has been thinking of defining moments that have led his company to where it is right now. There is a strong sense of nostalgia.

He wakes up and overnight he is worth $178 million, but he doesn’t feel any different.

Night – A Synopsis

The epilogue is set in 2007 and explains how far everyone involved in Nike has come till now. It shows the efforts Nike has made worldwide to make lives of people better, how the company has become even better when hit with problem like the sweatshop controversy, and how it is continuing to grow in the present. His hometown has honored him in a myriad ways, by naming buildings after him and Bowerman.

The epilogue deals with some very heartbreaking deaths. The first of these is the death of Knight’s son, Matthew, who dies in a diving accident after a life of running away trying to find himself. Knight still wonders if his being around more would have helped Matthew be a different person.

Bowerman dies after going back to the same place he was most nostalgic about. Knight recalls every memory with him, of running for him, that meeting that started the company, and how he was the creative genius behind so much of the company’s success.

Knight also reveals that he shares a very good rapport with all the athletes that endorse Nike, and how they have been there for each other in hard times.

Although Knight has since retired as CEO, his mind is still looking for new things to do. He feels restless, burrowing into his childhood memories and thinking of his family. The idea of writing a memoir pops up in his head because he believes that the story of Nike hasn’t been told properly. Additionally, it might inspire or help a new entrepreneur who may also learn from the mistakes Knight made. It is important to find a calling in life and never settle for a career or job. It is important to be persistent, but it is just as important to know when to quit and move on to the next thing.

He often wonders about doing it all over again – what he would change, what he wouldn’t do. Knight also candidly admits his failings. As they became rich after the public offer, the money affected both him and Penny in embarrassing ways. Penny took to going around with thousands of dollars in her purse and Phil started wearing sunglasses everywhere. However, when the initial silliness wore off, they return to normal. Now they make it a point to give away a lot to charity and want to leave most of their money after they die.

Knight contemplates on his favorite moments from the entire journey, and thinks of what all he would need to write his memoir. He remembers all those letters from Johnson that he could never keep up with, he thinks of the slides he had after he came back from travelling the world.

Seeing the movie The Bucket List also puts him in deep thought about his own bucket list. Having discovered nothing substantial that he could begin on immediately, he feels a little restless, but as soon as he chances upon the idea of writing a memoir and working towards it, he feels at peace again.

 

Walmart and their Robot Bee Patent

Reading the Walmart Patent, it seems like this is something that can and should be contested. The diagrams a literally what bees do + bluetooth and UAV prior art. What is the patent really? Seems unfair and worth attacking as a legal expert should (I am not one by the way).

Can you patent a docking station? Not sure. We know that China has a problem as the bubble bee population is in a state of collapse. Full grown adult Chinese citizens are pollinating flowers manually……so drone bees is a market.

This is the HoneyDrone (trademark) 

Benjamin Franklin | The Walter Isaacson Biography Synopsis & Analysis

Walter Isaacson – Ben Franklin

The following is an analysis and synopsis of Ben Franklin by Walter Isaacson.

Chapter 1 | Benjamin Franklin and the Invention Of America

Benjamin Franklins’ life is an interesting one, and the first chapter explores the depths of his character in the outset of that life.  Significant emphasis is placed on the fact that Franklin’s was not a linear but rather a multi-layered character, who carried facets from his different experiences in life, all in a single, complex yet amusing entity.

Basically, Benjamin Franklin was a polymath.

Benjamin Franklin is introduced keeping in context with his autobiographical work, as a cheeky young man with the guise for humility, arriving in Philadelphia to develop his own personality. As the story progresses, the tone changes to that of an old man, writing his life’s story in retrospection and with the aim of passing it down to posterity. Therefore, this work spans a full circle where you will come to know the person of Benjamin Franklin rather intimately.

Benjamin Franklin’s character is a rather endearing one- despite being a statesman; he was approachable, accessible and even relatable. Benjamin Franklin adopts a conversational and witty tone to write his autobiography, which helps you to see him not as someone on a pedestal but as someone from among the masses, contemporary even.

Apart from his admirable personality, Benjamin Franklin was also a man well versed in the arts and sciences. An intellectual man, we will see that he turns out to be a successful scientist and innovator with some important inventions to his name. He also had proficiency in the language, writing, and management- skills he honed to become an efficient diplomat, writer, and business strategist. His intellectual inclinations made him a philosopher; a pragmatic one at that.

Franklin came from the American middle class and despite his ascent in the world, he did not forget his roots. This gives an earthiness to his humour that comes through in his writing; writing that appeals to the masses. His belief in the power of the middle class as the force that will drive a new nation to prosperity reflects in his policies and the many measures he took to empower them. He prized civil harmony and undertook several civic- improvement programmes as he sought to give more power to the people who formed the essence of a democracy.

This work is a careful study of Franklin’s character that also turns out to a study in the changing paradigms of American society itself. He has admirers as well as critics, based on the time context he is viewed in. Some praise his materialistic approach to life while others decry his lack of vision for an exalted existence. The romantics vilify him while the entrepreneurs glorify him. This book, however, insists that lessons that are to be drawn from Benjamin Franklin’s life are far more complex than this binary. When reading this book, try to engage with Franklin’s character with a clean slate and not view his motivations that translated into actions as the maxims he swore by in life, because people are definitely more complex than that.

 

Chapter 2 | Pilgrim’s Progress

The opening of the second chapter familiarises us with Benjamin Franklin’s lineage. The aim of this approach is to educate a biographer about a personality by examining his family history. We come up close and personal with the character of Benjamin Franklin’s great-grandfather, grandfather and father, all of who possessed a strain of dissent and intellectual proficiency, which trickled down to his generation.

A rather descriptive account of the family tree informs us that his family had always lived in Ecton, Northampshire, and operated the smith’s business. Further elucidation details his father’s brothers’ lives and their peculiar qualities. From this section, we also find that the Franklin’s family practiced Protestantism in a time and land when it was looked down upon and even persecuted.

Considerable space has been dedicated to the character of Josiah Franklin, Benjamin Franklin’s father, perhaps as a result of the profound impact that he had on the latter’s life.  An original piece from the autobiographical manuscript has been included in the book where Franklin talks at length about the inspiring spirit of his father’s character. A critical analysis at this point reveals that the idealistic description may be motivated by a desire to evoke respect from his son for his grandfather, to whom this account is addressed.

The rest of the chapter focuses on Benjamin Franklin’s childhood. His inquisitive and inventive streak was apparent even in his early years. Another trait that would become dominant later on in his life, that of leadership and organisational abilities, was also conspicuous even in his fun and games. He continues recounting his early years from the time Benjamin joined his father’s business. Since his heart was not in it, he could not sustain interest. However, his inquisitiveness made sure that he had a valuable take-away even from a task he found drab.

Further, we also come to know about Franklin’s other great interest, reading. He indulged in a variety of books, which is exemplary of the author’s voracious appetite for knowledge.  The Netflix of the 18th century was in these books which had great influence on him, and he acquired many skills because of them.

Owing to his penchant for reading, his father sought to set him up in a printing press. He was employed in his brother’s press at twelve; to work as an apprentice. He also developed a knack for prose during this period. His new interest soon translated into an interest in debate and argumentation.  To nurture it, he would spar with a friend of similar temperament, John Collins. Despite the clarity of thought, Franklin fell short in arguing his side, for want of better writing skills. His father helped him hone his skills by pointing out his mistakes. He then adopted a sophisticated method of memorising words and ideas that he would like to use in his writing. His moment of validation came when he wrote an opinion piece for his brother’s paper, and it found great acclaim among the latter’s friends who contributed to the paper.

Now, we come to know that this was a time when political correctness was observed rather strictly, and its violation could make one liable for punishment. Kind of like 21st century North America! Something similar happened with Benjamin’s brother, who was imprisoned for running a piece in his paper The New-England Courant that was unacceptable to the Assembly, the governing authority. Benjamin decided to write with the pseudonym Silence Dogood a middle aged widow; when Benjamin’s brother learned about the ruse; James was upset. Following this incident, Benjamin had to take over the printing press. However, this carved a new rift between the brothers, which only deepened with their clash of ideas, and attitudes. Therefore, the story will now take you on a journey with Benjamin Franklin as he parts ways with his to find with own; he left his job without telling anybody.

 

Chapter 3 | Journeyman

Benjamin Franklin appreciated rationality, as a virtue greatly. He was both an ardent practitioner in his life as well an observer of rationality in others life.  You will find frequent examples drawn of this characteristic of his from his early apprenticeship days.

Franklin was a practicing vegetarian, as he saw the futility in the expenditure of time and money dedicated to lavish food. However, on his trip to New York, when he could rationalise eating fish to himself by reasoning that if they can eat each other, why should not he indulge himself. Franklin’s adroitness at rationality made him an important figure of the European Enlightenment when the virtue was hailed. We find that man’s ability to rationalise what he finds convenient, was of specific fascination to Franklin.

Continuing from the last chapter, we find ourselves back at Franklin’s runaway journey when his friend, John Collins arranged for him to board a ship to New York so that he would start a new life there. He met the sole printer there, but he sent him off to Philadelphia to work for his son. When he could not find work there either, he was introduced to his employer-to-be, Samuel Keimer. He was just seventeen years old at this time. Therefore, you can comprehend that Benjamin Franklin was a man of strong mind and heart, who was ready to brave unexplored territory in order to carve a niche for him.

He developed a good rapport with Keimer as they both found common interest in Socratic argumentation. Benjamin’s magnetic persona also helped him win friends in a new place, people who were of a similar temperament and taught him lessons that he carried with him for life.

Franklin’s writing skills, which he had been honing seriously, found wide acclaim by accident and a worthwhile patron in Governor Keith. However, his promises turned out to be empty, and Franklin learned about the folly of blind faith. From the trajectory of a few friendships and relationships that Franklin formed in these years and which fell apart for one reason or another, it can be concluded that Franklin’s charm could easily attract friends, patrons, and admirers, but keeping them was an art he still had to master.

During his time as a printer, Franklin indulged his philosophical interest and wrote a dissertation concerning free will and the idea of God. This early work of his was a rather shoddy attempt at philosophical writing. However, his position can be defended by the immaturity of his years. Through this writing attempt, it becomes clear that he was not a religious bigot and in fact was pen to scrutinising all elements of religion. He opted for a brand of religion that was pragmatic and where the pursuit of salvation was achieved through good deeds.

Franklin’s obsession with rationality and leading a meaningful life urged him to write a ‘Plan for Future Conduct’ to guide his endeavours. This lists of pragmatic rules sought to make him more of a likeable and productive person in life.

On his voyage back to America from London, he made keen observations about human behaviour that instilled in him a greater appreciation for society. He also honed his scientific acumen in this period and armed with his pragmatic rules for a successful life, Benjamin Franklin was ready to set up a new life in America.

Chapter 4 | Printer

In the fourth chapter, we delve deeper into Benjamin Franklin’s character. In the vast repository of talents he possessed, a flair for salesmanship is also featured. However, when life threw a curveball at him, and he could not make much of it, he fell back on what he knew best, the print business.

Franklin had honed his talents so much as to become indispensable for people around him. For instance, we are told that his employer, Keimer had to beg him to return after the previous fallout because only he could produce the finesse Keimer’s work demanded. Inevitably, his talents could not be tamed for long, and he set out again to make his own niche by opening up a print shop.

Franklin carefully created an image for himself and his business The Pennsylvania Gazette. He did not consider it merely as a career. Rather, it became a way of life for him. Despite reaching the pinnacle of his career as the President, he continued to identify himself as a printer. This goes on to display the dedication and respect he developed for his work.

After going through all the chapters till now, we can confidently say that Franklin was an intellectually inclined man who constructed opportunities to indulge his love for debate and thinking. An important outcome of this was the Junto / The Leather Apron Club, a group of talented young men whom Franklin employed to encourage his cause. His conversational style can be analyzed as disarming, engaging and effective, which helped him carve a successful public persona for himself as a man of intellect.

Early beginnings of Franklin’s interest in civic life can be observed at this stage itself as he used the platform of the Junto not only to discuss but also promote plans for civic development. Therefore, this can be identified as the nascent stage of Franklin’s journey as a celebrated statesman.

Franklin undertook ventures like the Busy Body Essays and Pennsylvania Gazette, through which he established credibility for his career as a publicist. Having risen in his public life, he then directed towards his attention towards private life. Many prospects fell through, mainly for want of suitable dowry until Franklin “chanced” upon Deborah Read. She did not come with a dowry, but as Franklin would later realize, made a better partner for him with her frugality and practicality.

Benjamin’s personal life, much like his public one, was not devoid of scandal, the most uproarious one being his allegedly illegitimate son, William. Even though his descent is a matter of vibrant debate to this day, Franklin never denied his paternity.

From instances of his writing, we can read that Franklin had formulated a concrete idea of what a perfect woman should be like: frugal and industrious. This notion was a dominant theme in his works, which can be seen as sexist from a modern lens. However, despite his primitive ideas about women, he did not limit his advice to only them. He called out men too, on their extravagance and wasteful ways. Therefore, we can conclude that he had struck an unusual balance between primitive and modern ideas in his writings…arguably.

Lucky for Benjamin, Deborah turned out to be an embodiment of traits he deemed virtuous for a wife. Therefore, they formed a companionship where Deborah became his partner both in the household and at work. From a detailed account of the personal dynamic between the duo, it can be inferred that despite some of his rather bigoted views extolling docility, obedience, and servitude for married women, he did appreciate the rebellious and assertive nature of his wife. Theirs’ was not a love that manifested overtly in grand gestures but can be found in subtle ones, like in the letters that Franklin wrote to his wife which are mentioned in the chapter.

Almost as if out of force of habit, Franklin outgrew Deborah. He had developed a character trait of not following through with relationships and followed suit in this marriage. Their personalities and interests came to contradict each others’, and Franklin stayed away from her for a major part of their marriage.

Apart from his marriage, another relationship that would have a profound impact on Benjamin was with his son, Francis. Adorably called Franky, Franklin doted on him and was proud of how curious he was. However, as we see, this turned into a bitter memory for him as he passed away at the tender age of four from smallpox. This made Benjamin a life- long advocate of inoculation and also translated into poignant works that he wrote in his memory.

Moving on, we return to the theme of spirituality in Franklin’s life. At this stage in his life, Franklin seems to have held his views against the wastefulness and dogmatism of organized religion. He continued to be tolerant of other faiths and sects. Benjamin’s brand of religion, as he mentioned in his writings, preached the importance of closeness with God but with pragmatism and devoid of dogma. The developing clarity of his ideas can be gauged by the superior quality of his later work, titled ‘Articles of Belief and Acts of Religion,’ when compared with his earliest attempt of ‘Dissertation on Liberty and Necessity.’

Benjamin Franklin had made it a mission in life to lead it as virtuously as humanly possible. In fact, he made a mechanical process out of this by making himself a list of virtues to abide by. A scrutiny of this list reveals that it was made rather conveniently to help him succeed in life by keeping his efforts on the right track but not chastising him too much. Therefore, it was not constructed with an abstract aim, such as that of spiritual salvation but a more fathomable, practical one.

Benjamin’s religious ideas would attract admirers and critics alike and result in the outstanding success of his Poor Richard series. He became an American icon of the Enlightenment movement of Europe as he worshiped all notions that the movement promulgated: reason, logic, and tolerance as opposed to dogmatism and bigotry.

In conclusion, it can be inferred that by this time, Benjamin had formulated a solid religious identity that was very different from those prevalent in his times. He used his wit, charm, and audacity to promote these ideas through his writings, following the Junto principle of revealing personal ideas through indirection.

Chapter 5 | Public Citizen

By this chapter, we have learned that Benjamin Franklin’s religious ideas were inclined towards pragmatism, tolerance, and appreciation of a civic sense in man because he equated ‘goodness with godliness.’ An extension of this idea can be seen in the manifestation of several organizations for the public good that operated under Benjamin’s watch.

These institutions- hospitals, libraries, fire brigades, were built and supported by an American community that extolled the values of individualism and communitarianism in the same breath. The existence of this paradox was enabled by Franklin’s fervent reinforcement of the idea that a keen civic sense is necessary for the development of the individual as well as the community he was part of.

During the wave of Great Awakening, Franklin encountered a number of personalities that preached strains of faith different from him, similar as him or those that simply amused him. We see that by defending or admonishing them, Franklin wove together his financial interests with his personal zeal for civic pursuits.

As Franklin continued expressing his dissident views through his newspaper, it gained popularity for its anti-establishment and rational sentiment. However, he competed with another prominent newspaper of the time, American Weekly Mercury run by Andrew Bradford. The recollection of sparks between them reveals that Franklin was a prudent businessman who chose his battles wisely and even worked in tandem with rivals when it benefitted him.

Further, as we look into the development of Franklin’s character, we come to evaluate his views about women. Even though not as sexist as the gentry in his day and maybe to an extent modern, Franklin still reared some regressive ideas about the education of women. This dichotomy is exemplified in the case of his daughter Sally, for whom he arranged a proper education in academic subjects, but the emphasis was always laid upon practical subjects that would make her an agreeable homemaker.

Writing to his friends and prospective suitors about his daughters, he would exalt her capacities as a smart and industrious person, but with an undertone that appreciated the usefulness of these traits in making her a good housewife.  The duality in his attitude towards woman also comes forth in his writings. On the one hand, he writes the extremely sexist, almost degrading piece about why older women make better mistresses than young ones and on the other hand, pens the ‘Speech of Polly Baker’, which is an excellent critique of the hypocrisy of society towards a woman’s sexual liberty.

Franklin continued his mission of spreading pragmatic knowledge and power of reason among people by the establishment of organizations like the American Philosophical Society and the more radical Pennsylvania Militia. The success of these institutions reinforced in him the belief that a union of people with common interests was capable of ruling itself and creating a productive society.

This realization and his success in a social and professional capacity would prompt him to retire from the printing business and focus on the other callings in his life; his love for science and penchant for politics.

Chapter 6 | Scientist and Inventor

Benjamin Franklin’s most well-known achievements apart from the field of politics are in science. As we have noted earlier, he had inherited inquisitiveness and nurtured it with voracious reading and meaningful inquiry whenever possible. That enabled him in making significant scientific innovations from as early as in his 20s. His retirement from the printing business afforded him the luxury of time to pursue his curiosities.

Since a young age, Franklin had been experimental and had tried to employ new- found information in everyday tasks to produce something new. The kite and key experiment that catapulted his name into the ranks of Newton and Watson and Cricks was a result of this very enthusiasm to see science in action.

Interestingly, despite being a shrewd businessman, Franklin pursued science purely for pleasure. We come to this conclusion from the evidence that he declined patents and did not necessarily seek utility in his experiments as long as they were able to amuse him.

Practical use of the procedures, even though a secondary goal, did feature as a requisite in his experiments and led to the development of a new design of a stove that produced lesser smoke. The first catheter in America was also a product of this habit.

A detailed study of the process that led to the famous ‘lightning is electricity’ experiment reveals the meticulous method that Franklin observed; relentless endeavor, curiosity, improvisation and keen observation. Despite this, his lack of interest in scientific laws and limitation of his sphere of interest to experimentation leads us to the conclusion that he was not a systematic scientist but more of a whimsical experimenter.

His scientific progress drew equal amounts of applause and admonition. On the one hand, the religious community condemned his innovations as ‘ungodly’; on the other hand, the scientific community went gaga over him and showered him with honorary doctorates. This dichotomy was settled in the succeeding generations when the scientific worth of his work was unanimously established.

Benjamin Franklin’s lack of a formal education in theoretical mathematics or physics can be pegged as the reason why he cannot be considered a scientist of the same merit as Galileo or Newton. However, when we weigh the theoretical importance of his seminal works, we can establish unequivocally that his findings formed the bedrock of some the most basic scientific principles that were later sophisticated by scientists and put to practical use. A prominent example of this can be his discovery of the absorptive nature of black and white color.

We can, therefore, conclude that Franklin was a stellar example of the Age of Enlightenment. He possessed a robust curiosity and the will to experiment to quench his curiosity. He proved to the world that ‘philosophical amusements,’ as scientific experiments if pursued with vigor, have the capability of putting a man in control of even nature’s agents. This notion reinforced the idea of belief in man’s inherent intellectual ability, which was the basic theme of the Age of Enlightenment.

Chapter 7 | Politician

In this chapter, we explore the characteristics that helped Benjamin Franklin become one of the most successful political leaders to have graced our past. First off, we discuss the humanitarian sentiment that he nurtured, and that drew him to the public service sphere.

Franklin believed that a successful civic society is possible only with the active participation of its citizens. He also laid emphasis on the values of pragmatism and tolerance in conducting state affairs. That was the driving principle behind his effort for a non- sectarian educational institution (which resulted in the present day University of Pennsylvania) and a public and private funded hospital.

Benjamin’s ingenuity gave birth to the matching grant, a system of joint government and private funding that is prevalent in America to this day. Although not a libertarian in the present sense of the term, he did believe in the limited control of the government in civic affairs.

Additionally, he favored a government that would strike a right balance between public and private collaborations to produce maximum benefit for the people. However, his beliefs were not binary. Through letters that he sent to friends discussing his political philosophy, we find that he was skeptical of going overboard with public welfare, lest it should lead to complacency and laziness among masses.

However, these were more of questions than assertions. The composition of his political philosophy can be broken down into some basic elements: resistance to establishment, tolerance and non- sectarianism, freedom of social mobility and exaltation of the middle class as the savior of society. He believed in an egalitarian and democratic governance, which was also inclusive of new talent and not just a select elite.

He cannot be called a conservative really, but his ideas were not entirely free of the prevalent currents of thought. For instance, his stance against slavery was not based on the immorality of the act but its economic impracticality. However, he was soon to re-evaluate his position and become a fervent abolitionist.

Benjamin began a formal political career by being elected to the Philadelphia Assembly. He continued his public welfare schemes after assuming office. Federalism, as a system of governance, also saw the light of day under his leadership at the Albany conference. He actively began nurturing his non-parochial view for the American society, where the colonies could unite into a nation.

A look into the amorous relations that Franklin forged out of his marriage was always short of overt passion and often tinged with a paternalistic attitude that he adopted towards the paramour. On the professional front, he was more conducive to risks as he functioned as a pragmatic negotiator in times of crisis for the colonial government, be it with the Indians or the Crown on the question of proprietors.

Therefore, we see that this period can be viewed as the formative stage in Franklin’s political career. Benjamin Franklin enunciated his ideas of non-sectarianism and practical governance rather clearly but was yet to become a formidable political force.

Chapter 8 | Troubled Waters

Owing to his skills as a negotiator and overall prudent politician, Franklin was sent as an envoy to England to appeal the colonies’ case. This chapter explores his life and experiences in a society far removed from the one he was used to.

Firstly, on the personal front, he befriended and sustained romantic relations with a couple of women, including Polly Stevenson, who would prove to be a lifelong friend to him. As earlier, he projected an avuncular, along with amorous, attitude towards her. He was impressed by her intellectual inclinations, and somewhere tried to find a substitute in her, for Deborah’s lack of these qualities.

London appeared to him as an interesting paradox- disease-ridden and dirty on the one hand, vibrant and cosmopolitan on the other. We see that the intellectual community burgeoned here in privileged spheres such as the Royal Society and in common coffeehouses as well. His interaction in these circles helped him forge some useful friendships with the likes of Dr. John Fothergill, Dr. John Pringle, and William Strahan. These associations would help him immensely in achieving his political goals in London.

Since England’s political scenario was unchartered territory for him, we see that his old tricks failed to gain him progress. He had come to England to appeal against the Penns and privileges of the Proprietors at large. He believed that the American people under the British Crown should have the same rights as those in England. However, he soon made a rude realization that people in Britain did not think so and the Proprietors claim had support in the British courts.

He would go on to reason with the Penns directly but would act distinctly out of character. He would lose his calm and often make far-fetched claims that were not entirely correct. He failed to reach an end with his negotiations but decided not to leave England until he had achieved some ground. This is a classic example of Franklin’s resilience as a diplomat. It would take a while before Franklin would regain composure in his correspondence with the Proprietors and use his old pragmatism to win a compromise. Even though the victory was partial, it was definitely a step ahead.

Franklin can be seen as an interesting character based on his beliefs and demands. He was a professed British royalist, yet his demands against Proprietary privileges in colonies was not in consonance with English beliefs. He theorized that the British saw colonies as resource centers that could be exploited to benefit the mother country. He argued against this and concluded that if Britain treated its colonial subjects with the same regard as its natural citizens, then the colonies would never rebel.

After a 5-year stint at London, Franklin finally decided to leave for home. He had wrapped up his job fairly well, though not as expected. Following a sentimental and emotion-laden farewell with his ‘surrogate family’ of Polly Stevenson and her mother, he finally returned to America and continued his scientific pursuits.

Chapter 9 | Home Leave

After returning to America, Franklin resumed his role as a postmaster. We have explored so far that he entertained a keen interest in travel. Luckily for him, his job allowed him just to do that. Despite his fervent attempts, he could not get his wife to accompany him. This can be attributed to her beliefs against venturing too far from home. It can be said that they both asserted their independence in their own way.

He toured the colonies several times and was familiar with the internal politics in a way that put him in a conducive position to bargain for their rights when the time came. First, such opportunity arose on the question of the Paxton boys, that threatened the outbreak of a religious and social civil war. Franklin came out in vehement opposition of the anti-Indian sentiment and published several pamphlets decrying the brutality. He came in direct confrontation with them and was able to pacify them enough not to unleash the same horror in his town.

We see that his hard line stance to bring the Paxton boys to justice was diametrically opposed to that of the Governor, John Penn, who wanted a negotiation for political benefit. This resurfaced the old antagonism between Franklin and the Penns. As a result, we find that Franklin grew increasingly cynical in his discourse on politics as its unjust arbitrariness dawned upon him. He rallied for a colonial rather than proprietary government, with renewed vigor. As a staunch Royalist, he wanted Pennsylvania to come under the direct Crown rule.

However, he faced much opposition for his views. There were two main reasons for this: the frontiersmen’s preference of a Proprietary government and the Penn family’s reputation as formidable political opponents that was known of, even in England. That did not, nevertheless, dampen Franklin’s resolve and he started a petition campaign against the government.  Amid fervent opposition that sought to drag his name through the dirt, he continued his crusade. Therefore, the election season of 1764 was an important year in America’s history of free expression, as it saw its uglier, unrestrained facet.

The elections resulted in a vote in the Assembly to send Franklin back to represent his cause in England. Franklin was more than willing to take up the task for the following reasons: he missed his stint in London, he felt confined in Philadelphia politics, and he had bigger plans for an American union that would require representation in the Parliament. The latter would become important amid news of the Crown planning to levy taxes on colonies. He thought it would be fair to extend citizenship to colonies if they were to be taxed.

He received a hearty farewell as people pinned hope to his efforts. Franklin, on a personal level, did not know what to expect from the trip. We come to this conclusion by his conflicting testimony to his friends, as he told some that he would return in a few months, while some had the knowledge that he did not plan to return at all.

Chapter 10 | Agent Provocateur

On his return to London, the first thing Franklin reconciled with was his ‘surrogate family’ of the Stevensons. He reconnected with Polly and continued sending her letters that portrayed avuncular affection and intellectual flirtation. He also got back with his friends and resumed appearing in their circles. Another important relationship he formed at this time was with his illegitimate grandson, Temple, whom he took under his wing and provided with education.

We will see that Franklin pursued his missions in England relentlessly. In fact, he had his blinders on so tightly that he would not return to America despite the news of his wife’s deteriorating health and would continue his futile fight for 10 years up to the eve of the Revolution. Owing to his political beliefs and allegiances, he had to perform a balancing act between being a royalist who advocated for an imperial rule over the colonies and establishing himself as an American patriot in the face of lack of sympathy from the colonial government.

Franklin found the political atmosphere of England rather bizarre and his old, trusted tricks failed to work there. One of the biggest miscalculations on his part occurred after the passing of the Stamp Act of 1765. It was a tax imposed by the Crown on the colonies, a fact that the populace resented.  Franklin took a pragmatic stance and advised that the people cooperate with the new law. However, he misjudged the attitude of the people who were willing to take up arms against the act. A conflict between the colonies’ and Crown’s interests caught Franklin in the crosshairs, who was villainized as an Imperial sympathizer.

While violence brewed back home, Franklin adopted a moderate stance owing to his love for Britain. Moreover, he was more of a smooth negotiator than a revolutionary by nature. However, his goal of making Pennsylvania an imperial colony now seemed far unrealistic than ever. To salvage his tarnished image as a supporter of the Stamp Act, he began a letter writing campaign where he categorically criticized the act and denied ever supporting it.

His moment of redemption came when he was able to present his case directly to the Parliament in 1766. He was able to put forth the social and emotional turmoil of the colonial population in strong and clear words. Therefore, an excellent performance there earned him his reputation back home.

Another political upheaval came with the passing of the Townshend Act. Franklin’s miscalculation this time was two-levelled; drawing a distinction between internal and external taxes, which was actually not respected in the colonies and adopting a position of moderation. He finally gave up a moderate stance when the British government thwarted his aspiration of Pennsylvania ever being free from the Proprietary rule.

Franklin took to writing critical articles against the government and its discriminatory Acts. However, his attack was still focussed on the Parliament rather than the Crown. Therefore, by the end of this turbulent phase, the inconvenience of Franklin’s paradox as a royalist and an American patriot resurfaced.

Chapter 11 | Rebel

When Franklin faced repeated failures in the political arena, he decided to forsake it for a while. He left in the pursuit of another passion he indulged in with great joy – traveling. He also resumed his scientific inquiries while vacationing around England as he found a subject of interest in the developments of the industrial revolution.

We see from accounts of this voyage that Benjamin’s burgeoning patriotic sentiment often came in conflict with his instilled allegiance as a royalist. For instance, he argued against British sanctions on the colonies by pleading that they would never threaten the British competition. Yet, on his tour of the industries, he wrote detailed descriptions of the manufacturing process in the hope of helping indigenous industries.

At 65, when Franklin found leisure from his professional duties, he took to writing his autobiography. Even though the professed aim of this project was to familiarize his son William with his ancestry and Franklin’s journey from obscurity to prominence, it does not seem to be that limited. Analyzing the writing style which details the processes of his achievements in the way of writing that maintained scope for corrections and additions, reveals that Franklin intended this work for mass consumption. By the time Franklin concluded his voyage of London, he had completed bout 4 chapters of what would turn out to be a lengthy autobiography.

On a personal front, we see that he found paternal affection for another young woman called Kitty, the daughter of his friends, the Shipleys. He would maintain a loving and healthy relationship with her for the rest of his life. At this point, he was also reminded of his grandson Benjamin Franklin Bache, whom he had never met.

Franklin often deemed his ‘surrogate’ relations more highly than he did his real ones. An instance of this can be observed in his behavior towards Benny, his real grandson whom he advised his wife against spoiling and his godson Billy, Polly’s son, whom he talked of very highly. 1774 turned out to be an especially trying time for him as he had begun estranging from his son William and then received the new of wife’s passing away in his absence.

While these developments underscored his life, Benjamin continued his scientific endeavors. Always better at pragmatic experimentation that theorizing, he made initiations into some important scientific themes that would serve as blueprints for subsequent generations of scientists. He, for example, continued his experiments with oil and water that would be a precedent for determining molecular size many years later. The cause of colds, lead poisoning, and saltiness of the ocean are just some of the many phenomena he unearthed in this period.

This was a time when his social philosophy was ripening, and even though it would be many years before he would declare himself an abolitionist, he had begun propounding liberal ideas. On the political front, he gained immense success by dislodging Hillsborough and receiving a land grant in Ohio. Unwittingly, he stirred up radical sentiment in the American colonies when his exchanges with an acquaintance were made public, which portrayed his fervent support for the colonies’ independence.

By 1775, Franklin was ready to leave London. His attempts at any compromise between the colonies and Britain had faded. Therefore, it turned out to be an emotionally challenging voyage for him as he sailed back to a warring America.

Chapter 12 | Independence

Agitations had broken out between British and American contingents, as Franklin sailed towards America in 1775. By the time he reached Philadelphia, the Second Congress was convened, and he was included as a member. The looming question was whether to fight the war for independence or of the assertion of American rights while remaining under British rule. This was a precarious position to be in for Franklin, who was torn between his sentiments as a royalist and an American patriot. He, therefore, chose to keep quiet while the other senators debated on the theme of independence.

He finally broke his silence during a meeting with Joseph Galloway and William Franklin and declared his stance in favor of complete independence for America. This decision was motivated by the several betrayals, personal slights and disappointments he had incurred by the British. It also exemplified the virtues he envisioned to build the ideal American society upon – appreciation of merit, a powerful middle class, liberty, tolerance, frugality, industriousness and respect for the merchant class.

Amidst certain dichotomy where some ministers sought a compromise with the Crown and others had radical ideas of rebellion, Franklin made his position clear by publishing a letter to his friend William Strahan in London. The language was terse and accusing, and its aim was to make public his ideas of America’s future. Even though the letter was not really sent and further correspondences between the friends were mellow and looked for conciliation, the letter did have its desired effect.

As an ardent supporter of an American union, he conceptualized the Articles of Confederation and the Perpetual Union. The kind of federation Franklin proposed was much ahead of its times as it meant the division of powers and a single-chamber Congress to ensure the security of rights and general welfare.

With his experience, managerial skills and visionary character, Franklin became a pillar in the American edifice against Britain. He was an obvious choice to head planning committees that drafted systems for the smooth transition of America into an independent state. Franklin often produced interesting amalgamations of his sharp wit and his political convictions, such as the rattlesnake flag with the motto of ‘Don’t Tread On Me,’ which symbolized American vigor and magnanimity.

When his plans at negotiation were once again thwarted in London following a meeting Lord Richard Howe, Franklin was sent on a secret diplomatic mission to France in order to cajole its alliance. By this time, Franklin’s age had begun to catch up with him, and he accepted the proposal rather reluctantly. He did not keep very well and lacked in vigor and energy.

Yet, he was ambitious about the potential of this trip for America’s diplomatic goals. For his company, he had in tow both his grandsons, Temple and Benny. He hoped that the tour could be a good experiential exercise for both of them and they would prove to be a comforting company to his old soul. Therefore, with a mission in sight, the old Benjamin Franklin set sail for France.

Chapter 13 | Courtier

After an uncomfortable voyage that took a toll on the aged Franklin, he finally touched the French coast. He tried to maintain a low profile at the small towns he visited so that he could test the receptiveness of the French Court for American ministers before initiating anything. However, as we have seen earlier, Franklin had become one of the most famous Americans in Europe through his scientific discoveries and achievements as a politician. Therefore, he was received grandly and was immediately a fixture at social gatherings.

Franklin sought to leverage his fame to further his political interests. France’s long history of hostility with England would make it a perfect ally, only if Franklin could persuade them. France received Franklin with open arms, and he returned the adoration by exalting French civility in his writings. He soon made himself at home thereby setting up a court of sorts.

He made a new set of friends who pampered him and was met by new colleagues, whose conflicting views made his work interesting.

Since American opposition had significantly increased and was buttressed by vigorous diplomatic activity, England deployed a sophisticated espionage system in order to gather information on American movements. Franklin was made wary of this threat as soon as he began operations in France. He even was confronted with the presence of a certain Edward Bancroft who functioned as a spy for the British for a long time before being found.

Franklin had a rather naive response to this matter saying that an honest man had nothing to fear, but it can be fathomed that such a statement was possible only because the spy’s information was unable to do any serious damage.

Franklin soon found a reluctant ally in Comte de Vergennes, the French Foreign Minister, who shared his dislike for England and faith in the new nation. He also liked Franklin on a personal level due to his bourgeois sensibilities that Vergennes appreciated. Franklin, for his part, found a perfect blend of idealism and realism to appease the French minister. He professed a calculated balance- of- power calculus to portray the feasibility of a Franco- American alliance. On the other hand, he exalted American values and sought to establish faith in it by presenting it as an asylum in the face of tyranny. He also began recruitments for the American army while still in France, and was able to secure the loyalty of men who would prove pivotal in the Revolution.

The French soon agreed to an alliance but awaited Spanish acceptance as the two had made a pact to act in concert. Meanwhile, Britain initiated secret negotiations with the Americans to avoid further confrontation. Franklin, with keen diplomatic acumen, pitted the French against the English by leaking information. France, therefore, agreed to co-operate without Spanish support and treaties of friendship and alliance were signed.

Thus, the course of the Revolution was finalized and also of the world’s balance of power, even though it was not realized at that stage.

Chapter 14 | Bon Vivant

After securing a French alliance for the American cause, Franklin was in a much secure position as a diplomat. During this time, he made several acquaintances that would leave a lasting impact on him. One of them was John Adams, who joined as an American commissioner. His equation with Franklin can be seen as a rollercoaster, where the two went through a series of emotions ranging from resentment, to amusement to finally, admiration. They had contradictory personalities but found common ground in their Puritanical beliefs.

Another important acquaintance Franklin made was the famous French philosopher, Voltaire. This match, interestingly, was designed by an enthusiastic public imagination that saw them as fated to meet. Their meetings caused a frenzy of fans and were profusely written about. Franklin’s association with the French intelligentsia and literati prompted him to join a lodge where his ideas against absolutism found popular acclaim.

True to his character, he forged some lasting and meaningful relationships with the opposite sex in Paris. These relationships were amorous but limited to the intellectual and spiritual level. Franklin’s societal stature made him instantly attractive to aristocratic women who sought ways to make his acquaintance. These affairs, often sexually charged though not fully consummated, fed a flurry of scandalous stories.

He got into emotionally serious relationships, one with a Madame Brillon and the other with Madame Helvétius. However, his reluctance to commit kept him from going through with either. These tumultuous relations had the effect of distancing these women from him, but on Franklin, it was quite the opposite: he felt young again, at least in spirit.

Therefore, we see that while Franklin attended to a lively social life in France, he unknowingly began distancing his real family.  His correspondences with his daughter were often didactic and disapproving and were received with replies that reflected disappointment and dejection. He was much softer with his grandchildren although instructive just the same.

Over time, his frequency of correspondence with them also declined, and its direct impact on Benny was that he drew in himself and became rather reserved. A change of company would see a breakout of his rebellious streak, which was received with an admonition by Franklin. For Temple, Franklin was incessantly trying to play matchmaker by hitching him to one of the Brillon daughters. However, Temple’s descent proved to be a roadblock, and while things could have been worked out, Temple had already embarked on his way to becoming a philanderer.

Apart from social obligations, Franklin also found time to pursue his scientific endeavors. However, this time they were tinged with humor and were for the sake of amusement, like his study on the causes and cures of farts. He rejuvenated his admiration for chess and was known to play until the wee hours of the morning. He believed that chess was a good exercise for the brain and taught one foresight and circumspection.

We, therefore, observe that Franklin’s character had evolved much and was now true to his age. Just like an old man with leisure, he was indulging in his interests and cultivating a healthy social life. He also kept his political beliefs to himself until asked for or as he deemed them necessary to share.

Chapter 15 | Peacemaker

During his time in France, Franklin had done everything to make himself a favorite at the French Court as well as the social circles. As a result of this, the French themselves lobbied for him in 1778 to be sent as minister plenipotentiary, and he was guaranteed the job. This result also upset a few that did not believe that Franklin’s candidature befits the bill, like John Adams and Arthur Lee. However, they had no choice but to find a middle ground and work with Franklin.

He came across several interesting characters during his stint as the American ambassador. One of them was John Paul Jones, an adventurous and rogue lad picked to head the American fleet in case of a British invasion. Jones was a reckless man who acted on whims, but this also gave him immense courage that Franklin believed would be necessary for such an expedition.

He was also an incorrigible flirt, which landed him in a series of scandals. Franklin adopted several methods to tame Jones, often sending him didactic letters that instructed him to use restraint in his dealings. When Jones proved his mettle in a naval battle against the British, Franklin developed more admiration for him and would even go on to defend him in disputes.

America needed financial resources to aid the Revolution, and it became rather desperate by 1780. Franklin, therefore, had to act as a representative of this desperation to the French. He made personal pleas, invoked idealism and national interest to get the French to loosen their purse strings. He could not get them to agree to the sum he demanded, though he did secure a substantial amount. Despite this victory, a fervent opposition against him that brewed back home disheartened Franklin. His adversaries pegged him to be too old and ineffective to take charge. That did not go down well with him, and he decided to resign.

However, the Congress was smarter than letting go of an experienced diplomat at a crucial time. So, this request was rejected. Additionally, he was given the charge of peace negotiator with Britain. Britain still wanted to negotiate terms of independence, while Franklin strongly put forward America’s non-negotiable stance. In fact, he proposed that Britain should offer reparations to America for the years of damage that it had inflicted and one way of doing so would be to cede Canada.

A complex balance-of-power game ensued where Britain, France, and America weighed the consequences of such a treaty. Soon a peace conference was initiated for all the stakeholders.

Franklin was clear about the terms he on which he wanted America’s independence. Therefore, he was especially annoyed when France was negotiated vicariously, and America was not involved directly. He felt that American dignity was being belittled. Therefore, he gained special permission to hold peace negotiations with Britain separately. After enduring a lot of back channel intrigue, Franklin found just the right moment to propose his peace plan when people more receptive of his ideas came to power in Britain.

The details of Franklin’s plan are worth mentioning. He divided his peace plan into two parts that contained both non-negotiable and negotiable terms. Under the ‘necessary’ provisions he demanded independence for America, which would be absolute in every sense, removal of British troops, autonomous and secure borders and fishing rights off the coast of Canada. Under the ‘advisable’ provisions, he asked for reparations from the British, ceding of Canada, acknowledgment of British guilt and a free trade agreement.

The plan was tabled, and the negotiations began. Britain was unwilling to ratify the plan in its original form and wanted further dialogue on both categories. France’s position as a reliable ally also came under doubt and led to a rift between Jay the skeptic, and Franklin, the believer. It would take some more espionage to coax Britain into making the terms of the treaty clearer so that American dependence on French help could be diminished and it would be Jay’s endeavor that would achieve it. Following this, he and Franklin were back on the same page and resumed working towards a common goal.

However, this accord came at the expense of peace in French and American relations and on Franklin fell the onus to explain to Vergennes about this decision. He did so by writing a letter that is considered to this day a diplomatic masterpiece. After that, there was little Vergennes could do to stall the proceeding of peace negotiations and eventually gave way. Therefore, Franklin was successful in securing a peace treaty with England, without endangering relations with France; a feat only a man of his political acumen could have achieved.

Having overcome this Herculean task, Franklin retired himself to the leisures of life. He found time to indulge in his family and called Benny to stay with him at Passy. For Temple, he continued to pull strings to secure a good office for him. This time was also conducive for him to resume his scientific pursuits that he had been away from for quite some time. The French were just as intrigued with science as he was and so he found ample opportunity to indulge himself.

He enjoyed the marvel of hot air balloons and perfected the design of bifocal lenses. He also continued writing anti-elitist literature and remained a crucial part of America’s independence proceedings. He also continued to work on his autobiography well into 1784, and he was 50% done with the project by that time.

Soon, it was time for him to return to America, but his bad health and affection for French society made him reluctant. However, when he received the news that his resignation had been approved by the Congress and that his efforts to secure an overseas appointment for Temple were futile, he decided to go back. Franklin conducted elaborate formalities of exchanging gifts and pleasantries with his high society friends and acquaintances, which included the King and Queen of France. He finally bid adieu to France on July 12 and was sent off by tearful eyes of his many admirers.

Chapter 16 | Sage

From accounts of his voyage to America, we can gather that he had finally let his age catch up with him. He did not attempt any studies nor made any observations. It was as if he was finally at peace, having completed all his duties. He also forsook work on his autobiography for that time. He now completely dedicated his time and effort to scientific experimentation. What resulted was a detailed budget of his maritime observations, replete with sketches.

He arrived in Philadelphia in 1785 and was received with great pomp and show by a large crowd. He soon settled into his Market Street home, surrounded by family and admirers. Despite his age and ensuing immobility, he was as sociable as ever and resumed meetings of old associations. He also went on a building spree and remodeled houses that he owned on Market Street. He installed a remarkable library there, equipped with some fascinating scientific implements, all of which were Franklin’s inventions.

It was almost impossible to keep Franklin away from an active political life, sometimes by his own insistence and otherwise by his admirers. He was soon elected president of the state executive council in Pennsylvania and was pleasantly surprised to find his popularity intact after so many years. He became part of the Constitutional Convention, whose task it was to draw up a final constitution for independent America.

He did not let his age or bad health hinder his work and took his seat every morning. He adopted wry storytelling over ostentatious oratory which was exemplary of the gravity he had gained with age.

He was a strong supporter of democracy and embodied the values of Enlightenments. He also had unparalleled experience in world affairs.

These qualifications made sure that his suggestions were always regarded even if they seemed incredulous to some. He professed compromise as a virtue for a nation that was proud of its diversity. This belief had helped him win battles in life. However, the one time that he forsook the value of compromise was also one of the most important ones on the issue of slavery.

Franklin, aged at 82 and having achieved the pinnacle of political success and recognition, had every reason to retire. However, his pride, by his own admission, still made him appreciate public ardor. Therefore, he accepted the renewal of his state presidency for another year. His swan song to a long and successful political career was to be his public mission against slavery. He presented an abolition petition in 1790, which pleaded for the recognition of the equality of man. It was an emotionally charged literature that sought to plead with reason. However, his petition by denounced by supporters of slavery and the Congress also refused to act on it.

Towards the end of his life, his faith in his religion became firmer than ever. Franklin preached indulgence in religion, but his reason for doing so also exemplified his rational beliefs; that it helped people behave better. He was an apostle of tolerance and left statues of this belief in the form of funds that he built for every religious sect in Philadelphia. Letters from the last days of his life are replete with his religious beliefs.

The very last letter that he wrote was to Thomas Jefferson, his spiritual heir to the nation.

His condition began to worsen and reached an all-time low. The final blow came on 17th April 1790, when Benjamin Franklin succumbed to an abscess which had burst in his lung. His funeral procession was a grand display of everything that the great man had achieved in life; throngs of admirers led by clergymen of every faith walking hand in hand to pay respect to one of the greatest Americans to have ever lived. Benjamin Franklin was a total badass indeed.

 

In Defence of Diefenbaker (if it’s possible): The Defense Crisis and Its Implications

A Defiant Defence of Diefenbaker: The Defense Crisis and Its Implications

One of the most tumultuous periods in Canada-U.S. Relations was the Defense Crisis of 1962 and 1963. In order to examine the American presence in Canada during that period, this article will accomplish four objectives. First, it will explain the background of the Defense Crisis. Secondly, this article will provide a historiographical analysis of John G. Diefenbaker. Thirdly, it will argue that the Defense Crisis led to explicit American intervention in Canadian politics. Finally, this article will defend George Grant’s significant contribution to analyzing this history and will reach the conclusion that Diefenbaker’s indecisiveness was not a product of personal tension with John F. Kennedy, but a product of an irreconcilable vision of Canadian Nationalism.

The historical background of the Defense Crisis begins on October 15th, 1958.  On that day, the Canadian government authorized negotiations with the US government “for the acquisition and storage of defensive nuclear weapons and warheads” [1]. Bomarc-B Missiles were to be placed in North Bay, Ontario and La Macaza, Quebec to neutralize a surprise Soviet attack. The Canadian cabinet knew that “in taking the nuclear-[fitted] U.S. Bomarc weapon, Canada ran the danger of falling under greater U.S. military control in North American air defence” [2] given Canada’s obligations under NATO and NORAD. However, in response, Diefenbaker continued through five years of government to stall making a final decision to accept or reject the required nuclear warheads. Eventually, the government collapsed when the Minister of National Defense Douglas Harkness tendered his resignation in protest[3]. Among historians, it is widely accepted that Bomarc controversy was a key contributor to Diefenbaker’s political demise because it highlighted indecisiveness caused by personality problems. This article will suggest an alternate cause of this indecisiveness.

Most historians have a vastly different interpretation of Diefenbaker compared to George Grant’s interpretation of the lucky 13th Prime Minister. The question is how has this history been interpreted through the lenses of political biases? Before assessing Grant’s perspective – which plays a central role in this article – a historiographical analysis of the various competing interpretations of Diefenbaker’s behaviour must be taken into account. It is the next step in this article to contrast these differences and to suggest why such a divergence with Grant’s perspective exists on foreign policy. A general consensus among historians suggests that Diefenbaker was indecisive on accepting the nuclear warheads. What remains to be observed is each author’s claim to the source of this indecisive foreign policy.

A recurring pattern of pro-Liberal Party historians is to attack the character, not the ideological motivations behind Diefenbaker’s demise. Nash and Robinson both take this interpretative position. Among the most popular interpretations of the period is Knowlton Nash’s Kennedy & Diefenbaker: Fear and Loathing Across the Undefended Border. The books major fault is its overemphasis on the personalities of John F. Kennedy and John G. Diefenbaker. Nash first notes that the two world leaders backgrounds do not complement each other as Kennedy was a Bostonian Catholic elitist and Diefenbaker was a Saskatchewanian Protestant populist. Although Nash shares this descriptive tendency with most other historians, he characterizes Diefenbaker as a messianic demagogue full of exaggeration and infectious charisma. Nash also repeatedly calls him ‘insecure’, ‘irrational’, ‘obsessive’ and a small-town lawyer. This is juxtaposed with friendly adjectives calling Kennedy ‘young’, ‘ambitious’ and ‘witty’. For Nash, a series of altercations illustrates the international friction between the two nations. In January of 1961, Diefenbaker visited Washington and argued with Kennedy over sport fishing and the War of 1812[4]. Their personal tension were further exacerbated in May 1961, when Kennedy visited Ottawa, insulted Diefenbaker’s French and then asked for a ‘two-key’ nuclear warheads policy with Canada. Diefenbaker’s response instead was a peculiar proposition to accept nuclear warheads only during the initial phase of the supposed Soviet attack[5]. Nash’s conclusion was that as a consequence of personal clashes, both politicians grew to hate each other resulting in a foreign policy rift[6].

Prime Minister John Diefenbaker is seen here with U.S. President John F. Kennedy in Ottawa in 1961. (CP PHOTOS)

One major historiographical problem in Nash’s interpretation is that he implicitly suggests the lack of friendship between leaders caused the disagreement on the Bomarc missiles. This is misleading. George Grant seems to have indirectly attacked the specific work of Knowlton Nash by stating that the media had “reduc[ed] issues to personalities”[7] for the purposes of the ruling class. Far too much credence is given to the friction between the two world leaders because of a simple truth; personal anecdotes are amusing and they give a simple but false explanation for the poor Canada-U.S. Relations during this period. Another problem with Nash’s interpretation is that in reality Diefenbaker’s policy was not endearing to either American presidents Kennedy or Eisenhower. Evidently, Nash overlooks the smooth personal relationship with Eisenhower despite serious policy disagreements between the Canada and American governments from 1957 to 1960. This misleading historical interpretation must be highlighted in order to demonstrate the flaw of overemphasizing personality clashes. In addition, it seems unlikely that Diefenbaker could position himself as leader of the Progressive Conservative party and then become what is described as a petty and irrational person upon meeting John F. Kennedy. There must be more to Diefenbaker’s indecision over the Bomarc missile. Nash does not differentiate between actions motivated by personal tension versus political tension.

Sharing a similar Liberal bias with Nash is another civil servant’s interpretation called Diefenbaker’s World. Basil Robinson openly admits to being a continentalist Pearsonian who witnessed Diefenbaker’s disintegrating leadership from within the foreign policy bureaucracy. As will be explored in detailed below, a continentalist is an individual who believes in a closely unified North America. Adding more substantive insight into this history, Robinson analyzes the underpinnings of Diefenbaker’s internal indecision by noting the dichotomy between two wings of the Progressive Conservative caucus. Howard Green and Douglas Harkness each represented competing wings of the caucus. Green was appointed the Secretary of External affairs and admonished nuclear proliferation while Douglas Harkness became the Minister of National Defense in 1960 and called for nuclear weapons on Canadian soil. While Green attempted to make international disarmament a reality, Harkness had to constantly make excuses for “the failure of negotiating with the United States and NATO authorities on nuclear warheads”[8]. Robinson also heavily implies that the Prime Minister was negligent and indecisive because of his natural tendencies and demeanour. This is flawed and serves Robinson’s personal self-defence from fundamentally disagreeing with Diefenbaker’s vision of Canadian Nationalism.

The more conservative leaning analysis, Peter C. Newman adds greatly to the interpretation of the growing Defense Crisis. Newman wrote Renegade in Power within several years of Diefenbaker’s fall in 1963. Newman took the necessary time in a balanced historical interpretation to focus on the philosophy that drove Diefenbaker to reject the rules of international subservience. For Newman, Diefenbaker believed in national building in the tradition of John A. MacDonald, although in a modern era of increasing continental interdependence. Diefenbaker was surprisingly left leaning on welfare policy and desired closer ties with Britain, which American continental interests despised[9]. Newman continually emphasized in contrast to the Nash and Robinson readings that the Canadian Nationalist rhetoric damaged the influence of the “continentalists in the American State Department who believe that what’s good for the U.S. us automatically good for Canada”[10]. “Diefenbaker never managed to make convincing his often-repeated boast that his anti-Americanism was actually pro-Canadian”[11]. Although both Newman and Grant agree that a clear vision of Conservatism was allusive, they both point to the institutions and entrenched structures that usurped Diefenbaker from power. The indecisiveness was political, not a product of irrational fool, but of serious discord with the rhetoric and the realities of Canada’s position in North America. It was not that Diefenbaker’s indecisiveness was a product of character, but a product of untenable principle.

It could be argued then that the forces of continentalism overthrew the Diefenbaker’s Progressive Conservatives. With serious policy missteps regarding to the Coyne controversy, cancellation of the Arrow, growing monetary crisis, unabated unemployment rates, Diefenbaker’s defeat in 1963 can be attributed to many factors. This article, however, will present conclusive evidence that among the most significant factors was the American desire for regime change in Canada.

The Cuban Missile Crisis of October 1962 reopened the debate over nuclear warheads in Canada. For Kennedy’s Secretary of State Dean Rusk, “Diefenbaker’s ‘introspection and nationalism’ were the biggest problems in Canada-U.S. relations”[12]. On the Canadian side, continentalists like Sevigny believed that “the need for…a closer association with our NATO partners…[was made] very clear by [the] tragic Cuban incident”[13]. From the American perspective, the intense crisis proved resolutely that Diefenbaker was either indecisive or stubborn with regard to American security needs. Following the failure to swiftly declare ‘DEF CON 3’ on October 21st, 1962, the Diefenbaker government was the target of a replacement campaign that would allow American Cold War objectives to be achieved. Similar to Vietnam in October 1963, Canada required a discreet coup d’etat. In quick succession, the Kennedy Administration struck three strategic blows against the Canadian government to achieve that end.

The first blow occurred with an incident of frankness, revolving around retiring NATO General Lauris Norstad; an American. On January 2nd, 1963, whether by accident or design, Norstad told reporters that Diefenbaker had not fulfilled his obligations under NATO regarding accepting nuclear warheads. This was an open attack on the Canadian government that would spark major controversy. Criticism in the Conservative caucus put Diefenbaker on unstable ground as indecisiveness seemed to give way to utter incompetence.

The next blow was the Pearsonian Re-Alignment on missile defence. On January 12, 1963, newly anointed Liberal Party leader ‘Mike’ Pearson decisively declared that he was ‘ashamed we accepte[d] commitments and then refuse[d] to discharge them”[14]. In a complete reversal of Liberal Party policy, the Liberal leader fulfilled the desires of the ‘Establishment’ by calling for the acceptance of nuclear weapons. The infamous about-face was the consequence of repeated consultation with the JFK. Many insiders “felt sure that Pearson had made a deal with Kennedy that in exchange for Pearson’s switch on nuclear warheads, Kennedy would help destroy Diefenbaker”[15]. As two Nobel Prize winning internationalists, Kennedy and Pearson had good personal relations, but far more importantly; Pearson had a malleable ideological preference for continentalism.

The final blow was a reaction to a miscalculation on the part of Diefenbaker. On January 21, 1963, Diefenbaker claimed in Parliament that a ‘rethinking’ had occurred between the leaders of America, Britain and Canada at the Nassau meeting. This was a crass attempt to justifying indecision concerning the nuclear warheads[16]. The implication of this gaffe was that a public denial in a U.S. Government press release was necessary and tremendously embarrassing. In essence, the Kennedy Administration had explicitly intervened in Canadian affairs in what would “deliberately foster an anti-American thrust in the tactics…[of[ the coming election campaign”[17]. This evidence of interference was openly accepted by future Liberal leader Pierre Trudeau who confirmed in the Cite Libre that “Diefenbaker was beaten by ‘les Hispters’ around Kennedy”[18]. The 1963 Diefenbaker campaign was had the best of his political career according to most sources, but it was not enough against the full force of the United States. The ultimate consequence was the collapse of Diefenbaker and re-installation of the Liberal regime. The nuclear warheads were brought into Canada immediately by Pearson’s new government.

The most plausible conclusion for why Diefenbaker’s government fell is articulated by Sevigny: “…by choosing to listen to the dreamers in his entourage and discarding the opinions of the realists, John Diefenbaker committed his most serious mistake, one which broke up his party”[19]. From the evidence, Diefenbaker’s dream of Canadian nationalism assumed that NATO was an alliance, not an extension of American foreign policy. Pearson’s acceptance of the latter gave him the advantage of American influence. During the election of 1963, Diefenbaker tried to paint the Liberals as co-conspirators with Washington and that a vote for the Liberals would lead to nuclear war[20]. This did not resonate. However, there was some credence given to Diefenbaker’s nationalist position after U.S. Secretary of Defense Robert S. McNamara revealed that the Bomarc missiles were in fact designed to draw fire away from American cities without much regard for Canadian civilians below the aerial interceptions of a Russia attack[21].

To recap, the article first explained the Defense Crisis of 1962 and 1963. Subsequently, a historiographical analysis of Nash, Robinson and Newman interpretations showed that Liberal historians attempted to focus on Diefenbaker’s character over the true source of conflict. Then, the evidence was examined showing the Kennedy Administration’s intervention in Canadian politics. The article will now address the unique historiographical interpretations proposed by George Grant. It will conclude that Diefenbaker’s political principles were his ultimate downfall.

To understand more clearly the underlining framework of American manipulation, George Grant’s interpretation of Diefenbaker’s demise is most salient. George Grant’s Lament For a Nation is a direct reaction to the fall of the Progressive Conservatives in 1963 and its implications for Canadian Sovereignty. As part of his analysis, Grant states that “lamenting for Canada is inevitably associated with the tragedy of Diefenbaker”[22]. According to Grant, Diefenbaker’s political failure occurred because he challenged American continentalist, progressivism, and capitalist designs in Canada. The “prairie blowhard”’s downfall was rooted in his ideology of Canadian Nationalism. Part of the great disappointment from historians like Peter C. Newman was that Diefenbaker’s larger than life expectations fell well short of their mark. His “One Canada[23] campaign rhetoric admonished voters against the Liberal desire for “a virtual forty-ninth state in the American Union”[24] but this socialist nationalism could not stand a chance in an already submissive Canada. In the end, the Bomarc missile fiasco was the tipping-point for an American coup d’etat that was in the making upon Diefenbaker’s rise to power.

To elaborate on Grant’s argument, American imperialism relied heavily on the ruling class within Canada that had become continentalized in its views. These complicit Canadians were Diefenbaker’s adversaries. They include the King, St. Laurent and subsequent Pearson Liberal governments, as well as the entrenched continentalist bureaucrats such as Robinson and Pearson, in addition to the Central Canada’s anti-rural ‘Establishment’. Whether collaboration was intentional or accidental, the Liberal Party achieved hegemony during this period of the 20th century in part because of their acceptance of continentalism. Grant suggests that the march to American annexation was moving faster with Liberal pro-capitalist policies that “paid allegiance to the homogenized culture of the American empire”[25]. As a consequence of compliance, American universalizing and homogenizing free-market forces within Canada benefited the willing Liberals and disadvantaged the Saskatchewanian who was a populist that rejected the ‘Establishment’. Liberal rule was only interjected by a lapse from 1957 to 1963, which would be marked by a constant struggle between the three groups and the antagonist to their self-interest; Diefenbaker.

 

A view of the launch of a CQM-10A Bomarc target missile.

If this is true, as the evidence suggests, then this prairie, Protestant, orator served merely as a sacrificial lamb for American Cold War objectives in 1963. It also shows that the demise of Diefenbaker’s government was the tip of an iceberg that has inevitably sunk Canadian political autonomy. Diefenbaker was unavoidably wrong in contradicting the conventional wisdom of the American led progressive age. From Grant’s account, Canadian sovereignty was no longer viable since no alternative could be found, as demonstrated by Diefenbaker’s failure. In truth, Diefenbaker seemed to be an irrational protestor because a truly rational leader would have submitted to American desires. In his concluding optimism, however, Grant argues that the overwhelming forces of American imperialism left Canada as a satellite state destined to desire annexation for the betterment of Canada’s citizens[26]. The gravitational forces of progressivism, globalization and assimilation of cultural distinctions will ultimately result in the amalgamation of Canada into the American super-structure. This is Grant’s solace which Diefenbaker’s nationalistic rhetoric, so passionately, hoped to avoid but could not.

It would be erroneous to not mention, at this point, that George Grant was a leading proponent of Red Toryism. Compared to Liberal historians such as Nash and Robinson, Grant’s politics may too appear to mask biases. He may have simply developed a skewed perspective of Liberals who “led inexorably to the disappearance of Canada”[27]. However, his claims are justified because they can be qualified with compelling evidence. Both sides have a point, eh?!

The goal of historians is to the piece together the past and synthesize it into tangible explanations of those events. It stands to reason that the Diefenbaker’s flawed personality, described by pro-Liberal academics, is a distraction from the actual source of Diefenbaker’s demise. Instead of the rampant character assassinations, historians should note that the causal arrow moves from Diefenbaker’s conceptualization of Canada to political indecision with regard to the Defense Crisis of 1962 and 1963. What becomes resoundingly consistent among historians is the sense that Diefenbaker was a disappointment. Intrinsic in their view is that he failed to achieve what his rhetoric so sincerely promised. Regardless of the bias of the various historians, there is a compelling argument within Grant’s work that may help change the commonly held perception about the outsider prairie populist and the Canada-U.S. relations in that period. The tragedy of Diefenbaker needs to be re-written to pay homage to his perilous and courageous attempt to carve out a sovereign nation despite forces more overwhelming than anything ever witnessed on this earth.

 

Work Cited

Diefenbaker, John G. One Canada: Memoirs of the Right Honourable John G. Diefenbaker: The Years of Achievement 1956 to 1962. A Signet Book: Scarborough, 1976

Grant, George. Lament for a Nation: The Defeat of Canadian Nationalism: 40th Edition. McGill-Queen’s University Press: Montreal, 2005.

Nash, Knowlton. Kennedy and Diefenbaker: Fear and Loathing Across the Undefended Border. McClelland & Stewart Limited: Toronto, 1990.

Newman, Peter C. Renegade in Power: The Diefenbaker Years. McClelland and Stewart Limited: Toronto, 1963.

Robinson, Basil H. Diefenbaker’s World: A Populist in Foreign Affairs. University of Toronto Press: Toronto, 1991.

Sevigny, Pierre. This Game of Politics. McClellan and Stewart Limited: Montreal, 1965.

Smith, Denis. Rogue Tory: the Life and Legend of John G. Diefenbaker. MacDarlan Walter & Ross; Toronto, 1995.

Stursbeg, Peter. Diefenbaker: Leadership Lost: 1962-67. University of Toronto Press, Toronto, 1976.

[1] Robinson, Basil H. Diefenbaker’s World: A Populist in Foreign Affairs. University of  Toronto Press: Toronto, 1991: pp 106.

[2] Nash, Knowlton. Kennedy and Diefenbaker: Fear and Loathing Across the Undefended Border. McClelland & Stewart Limited: Toronto, 1990: pp. 76.

[3] Newman, Peter C. Renegade in Power: The Diefenbaker Years. McClelland and Stewart Limited: Toronto, 1963: 367.

[4] Nash, 96

[5] Nash, 119

[6] Nash, 100

[7] Grant, George. Lament for a Nation: The Defeat of Canadian Nationalism: 40th Edition. McGill-Queen’s University Press: Montreal, 2005: pp 8.

[8] Robinson, 227

[9] Newman, 254

[10] Newman, 261

[11] Newman, 262

[12] Nash, 65

[13] Sevigny, Pierre. This Game of Politics. McClellan and Stewart Limited: Montreal, 1965.

[14] Smith, Denis. Rogue Tory: the Life and Legend of John G. Diefenbaker. MacDarlan Walter & Ross; Toronto, 1995: pp. 469.

[15] Nash, 255

[16] Smith, 466

[17] Robinson, 307

[18] Nash, 301

[19] Sevigny, 261

[20] Newman, 387

[21] Newman, 391

[22] Grant, 6

[23] Diefenbaker, John G. One Canada: Memoirs of the Right Honourable John G. Diefenbaker: The Years of Achievement 1956 to 1962. A Signet Book: Scarborough, 1976: pp. 21

[24] Grant, 13

[25] Grant, 7

[26] Grant, 94

[27] Grant, 6

Phil Knight | Travel The World To Get Insights & Chase Dreams | 1962

air-travel-not-as-commonPhil Knight, aged 24, traveled across the world to chase his Stanford paper dream of creating a shoe importing business. In the contemporary era, air travel has been accepted as part of pop culture, what with bucket lists, gap years and travel vlogging becoming the norm. But back in the 1960s, ninety per cent of Americans had never boarded a plane. Most Americans had not travelled more than 100 miles from their home.

Phil or Bucky, as his dad used to call him, felt hesitant to ask his father for money to support his plan to travel the world from Berlin, London, Paris to Tokyo, Cairo, Athens while also exploring his business venture idea in Japan. Phil knew before going into the chat with his dad exactly why his father would reject the travel plan. Phil Knight’s dad is an interesting character. His father ran a local Portland-based publisher and was former lawyer. He was someone whose aim in life is to achieve respectability, and more importantly, to be seen as respectable by the society around him. Respectability demands a stable career, a beautiful wife and obedient children – children who don’t randomly have the urge to travel around the world. However, Phil’s request plays on his father’s youthful regret of not travelling much, and he gets his way immediately.

Travel the world monument conceptKnight decides to enlist a friend for the journey, and his Stanford friend Carter was excitedly on board with the global adventure. They had an amazing beach-drenched time in Honolulu, where the itinerary goes out of whack because they love the place so much they decide to rent a place and find jobs. From selling encyclopedias to securities, Phil finds he is uncomfortable being a salesman, and even more uncomfortable with rejection. Eventually, he moves on in his travels alone, as Carter chooses to stay behind for a girl he found. The journey Knight is on is one of self-discovery, to find out what interests him – and perhaps denotes something we all can relate to at one point of time or the other.

nike-goddess-of-victoryHe describes his travels through various countries, elaborating on the ones he enjoyed the most while the rest are clipped to a couple of sentences. The author searches for spiritualism everywhere he goes – as if he is seeking out a power higher than himself to give him some direction. He does find the teachings of various cultures, but nothing moves him as he expected it to. Greece and its architecture, however, leaves a lasting mark on him. Athena the goddess of victory “Nike” is of particular interest. It might be historical revisionism but perhaps more to tell a great story but that name might come up later…..

onitsuka-co-tiger-shoesPhil Knight creates his first business pitch in Kobe. Japan at the HQ of Tiger Shoes, Onitsuka Co. He was warned by two American ex-occupation military guys about how Japanese negotiating is completely different than the typical aggressive American manner, so Phil practices what he will say and how he will deal with his proposed pitch of the “Crazy Shoe Idea.” In the meeting, which featured top Tiger Shoe brass, Knight ends up speaking from a safe space – channeling the speech he gave at his entrepreneurship presentation at Stanford, something he had studied really hard for (‘58-’62) and which had been then the basis of his “Crazy Shoe Idea.” The basic pitch can be captured in the title of the paper: “Can Japanese Sports Shoes Do to German Sports Shoes What Japanese Cameras Did to German Cameras?”

yenKnight was pleased with how the meeting went. The Onitsuka team seemed intrigued with his US distribution strategy which was peppered with quantitative insights, market sizing and a vision for getting Tiger ensconced into the US mainstream. When they asked what the name of his company was, Knight replied with “Blue Ribbon”. His pitch also hit a nerve as the Japanese management were seeing Yen ($) signs via the US track. Without knowing the outcome of the meeting (as Japanese are stereotypically hard to read), Phil had his father wire fifty bucks to Onitsuka so that they could send over a shoe samples they talked about in the meeting.

classi-tiger-shoe-designWhen Phil arrives home, looking bohemian and travel worn, the first thing he asks his dad is if the shoes have arrived. This part of the ShoeDog story is interesting not just because there is a very beautiful description of every country he visited, but because the reader can see the author’s passion for shoes developing in successive stages – from nothing in Honolulu to noticing the shoes of even beggars and statues. Great minds connect desperate events to create innovation; Knight was already on his way to greatness.
shoe-dog-by-phil-knightThe above synopsis is based on notes from ShoeDog by Phil Knight.nike

Blockbuster & Buster Sales Video Training #ThrowBackThursday

Listen, Think and Act…starring Buster Sales. Buster Sales is very frightening to me. Blockbuster should have played up the horror theme in this video just because it is weird. I guess if you want to your employees to pay attention, you might want to shock them with a strange training video. Not a terrible strategy…. I just can’t get the thought of “IT” the made-for-tv movie….
Is this kinda creepy?

Funding Your Startup Guide | Getting Investment

“The following are my seminar notes from October 5th, 2011 @ The British Library: Business & IP Centre in London, UK. This seminar is generally relevant globally but particularly if you live in LonDonN. All examples are circa 2011. I used this guide to gain an initial $5,000 USD investment in my startup!” – Matt Arnot

How to Fund Your Start-Up

by Matt Arnot based on Paul Grant’s presentation.

Introduction:

Mr. Grant learnt how the funding game operates from his Banker to Entrepreneurial experiences, and he has realised that entrepreneurs are wasting a vast amount of time looking for capital, and then getting bad deals. Mr. Grant has helped with HSBC sponsored events, doing many workshops, seminars, and he is business coach.

READ IT ON THE GO:how-to-fund-your-startup

The Objective of this Seminar:

• Getting funding
• Retaining ownership.
• Giving away as little equity as possible.
• Building on expertise and contacts.

The Story of the Eager Businessman:

The eager businessman had a scalable business, which had a lot of potential, but he/she was too impatient. Through his own desperation, he was offered a deal with an investor to give away 51% of the ownership of his business to the investor. In the end the eager businessman said “Yes” at 51%.

A few months later it was revealed that the investor had:
a) put a cap on the businessman’s salary, b) gained complete control over the finances, c) moved the company’s head office, and d) messed around with the fundamental designs of the business.

Making a quick deal is fine if you don’t mind working for someone else. However, if you do mind working for someone else then you should try to make a quick deal early on. There are ways of pulling back equity but it difficult so spare yourself that struggle…

…Part of the game is about controlling the majority stake in your own company and it takes a long time to get money from investors.

The biggest mistake made by entrepreneurs is to play on the wrong field of the four levels of this game. Therefore, you should:
1) Decide what level you are on,
2) Target the players you need to approach

The 4 Levels of the Game

Seed Funding – sources: Family, Friends and Government grants
£1K – £50K: Your business is an unproven concept, and the service/execution needs to be ironed out. You may have spoken to potential customers, and you have determined that there is a market. For an investor, the risk is very high.

Early Stage – sources; Angels, small funds, banks, Invoice discounting, grants, asset finance/bootstrappin
£50K – £250K: You have proven that your concept works, and you have a revenue stream or streams. The investment really does cap out at £250K because there is too much risk for investors. The business angel doesn’t want to concentrate their risk.

Mature Growth – sources: Ofex, AIM, Full Listing, Mezzanine Finance £250K – £10million – You have a good team, and you are executing well. You have proven the concept works in the UK as a whole. The VCs are interested because the risk is lower, this is possible only because VCs are not interested in risk now-a-days.

End Game (The Exit) – Trade sale, MBO,MBI, and in about 2% of cases an AIM listing.

The most believable exit for yourself and investors is a trade sale. Your business has a high valuation, The strategy applied here might be for you to get a management buy out in 5 years time, or for management to buy into the company, but it is not much of a case
for an exit. Get another company to buy you, but if you are in a slow industry they will be less inclined because investors want to make quick exits.

1%…Typical success rate for start-up raising equity in the funding game.

Why have so few entrepreneurs succeeded? You to have a business plan etc BUT this lower performance happen because they haven’t played the game well. There is no proven revenues, and haven’t tested their business model sufficiently….1 out of 100 entrepreneurs actually acquire funding of + £250K.
These are the Paul Grant, and VC/Angel Groups findings. The 1% figure is optimistic.

The 1% Approach….(means failing)

1) An entrepreneur has a great idea!

2) Sets out writing a detailed business plan: a robust business plan, which experts have been paid to ensure will work. Some entrepreneurs buy business plans, and end up spending a year working on a business plan. There are some people who
spend £50,000 on business plans, and only get £5,000 back in investment. Everyone thinks it is all about the plan, but continually fine tuning this blue print for the business actually detracts from reaching your funding goal.

3) In Search of Capital: while people aren’t even keen he/she flies to Silicon Valley where they meet VCs who are disingenuous, and rarely say “no, thanks” for fear of passing up the next Zuckerberg. There is no margin for saying “no.” For the VCs, there is no reason to turn someone away completely, but instead they will spur on an entrepreneur and give the entrepreneur false hope about the possibilities of successful deal being made after further research. Plans are refined, and entrepreneurs then go back with a better business plan, and a bigger team, but it is a waste of time, and have to get salaried jobs.

4) Entrepreneur quits after a year of searching: they might have good team etc and they blame the business plan, or the company who wrote up the business plan for them, perhaps some interest occurs but disappears before any contract or commitment to investment occurs.

BUT they are not going about it the right way.

The Success Model (Works much better!)

1) An entrepreneur has a great idea!

2) Researches market & creates cash-flow: The entrepreneur takes a week or two to produce a 2 or 3 page plan with a cash-flow and P&L forecast. It looks viable. So he/she asks potential customers whether they would buy this product/service? The entrepreneur conducts market research. The entrepreneur goes to potential customers, and even competitors to make contacts and gain feedback. “Can you help me on this project I need to find cash-flow” It could be tiny, but they start getting cashflow through testing the idea, up-front payments, or other methods.

3) Based on experience, proceeds with a concise plan of 12 pages where the most important aspect is centrally focused on an executive summary, which investors will read. Investors will ignore the majority of the business plan document anyway, so please not that the executive summary is the most valuable part of the
business plan.

4) Secures funding with a favourable valuation: the entrepreneur has proven that he/she has a viable concept that is working, and that they have reduced the risk substantially by generating revenue. Their funding is increased with this kind of revenue generation, so they offer a simplistic forecast.

Regarding the Business Plan: VCs are not going to read the business plan but they will read the executive summary: there is no time, as the VCs need to see if the business is credible or not quickly. It may be disappointing to you if you’ve spent the last 9 months writing a robust business plan but learn the reality when asking VCs:

“Did you read the full plan?” The answer is frequently, “No, not really.” Not even small VCs have a good response rate when asked, the vast majority of people will not read your entire Business Plan, so do not make this mistake. They will only notice the tools you have, the actions you have done and the revenue being generated.

Who are the Players?

• The Angel investor
• The Banker
• The VCs
• Government officials
• The Gatekeepers
• The Entrepreneur
• Family and Friends

The Incubators

At the seed stage: Incubators nurture very young companies. They are solely looking for seed stage people ie. those who are vulnerable without any cash, and who need an environment to help them grow. These organisations are set up to give a little bit of money, usually between £10K to £20K to get a business started. They will provide expert advice around that business, including mentoring, office space. There is a lot of access to funding, but these incubators are very technology biased.

The Kinds of Incubators:

Seedcamp (competition based) http://ycombinator.com/ You pay a fee, and it is competition based. You apply to be part of an open pitching competition. If you win, then you get the support, and the money for winning. The problem is that entrepreneurs might not be so good at pitching.
White Bear Yard: they take on someone, read up on it….
Innovation Warehouse: It is part funded by the Corporation of London, they have a small fund attached, and large spaces available to you, also supply a mentoring system, and access to funding. For initial inquires about IW, ask Mr. Grant.
Open Fund: it’s another pitching type event.
Springboard: universities are a good place to start from.
www.microfunding.com These different options require that you pitch effectively amongst large groups.

The Angel Investor (Offering cash, experience and divine guidance)

The perception is it is extremely difficult to get Angel Investment, but there is a lot of money out there. The problem is, rather, that most of the deals aren’t good enough. Most deals are through a network BUT Angel Investors do not want to invest in a badly
structured deal where the propositions do not stack up.

People are very unrealistic about raising £900,000, for example. Or people are very unrealistic about time scales for investment, i.e. 1 or 2 months. They prepare things on a piece of paper but you really need to make money, until you have that you don’t have a lot. It’s a competitive environment, where only 10 out of 100 will actually get read. It is very difficult to get any attention from Angel Investors.
Angel Investors want to be within an hour’s drive: You will want to be in close proximity to your angel investor, do not go out of London, or southeast etc. International angel investing is unnecessary.

Angel Investors investment £50K – £200K: Investment size has deceased over the years. The deal size was much larger a few years ago at about £100K, now it has slipped under £70K on average. It is now not uncommon to get £20,000 or £30,000 instead. This decline has occurred because of the decline in ‘crazy money’ where Angel Investor wealth has declined in the personal accounts. The other reason is it is much easier to start a business on less money in 2011. Running some businesses can cost next to nothing in some cases, so the business environment has changed.

Angel Investors nearly always invests in areas of expertise: It is not easy to make money as an angel investor, and there is a strong incentive to have expertise in a particular area. If they know software, they will stick with that industry, or venture into other areas at their own risk. Angels get burned badly in some cases, they retreat to solid knowledge areas.

Angel Investors tend to experienced entrepreneurs: so don’t pull the wool over their eyes. It is very important to be fairly honest with entrepreneurs. They are looking for deals with a potential to attract VCs.

Angel Investors expect 10x Investment in return: The average portfolio of an Angel is about 10 deals, 2 or 3 will die quickly, but then the majority of deals will go on and on, and never making a profit and no change of an Exit. The only deals they will look at are
the ones that have a chance of getting them to an exit, there is no point of doubling their money because that will not work. ROI from 40% p.a.

Angel Investors exit for them is often in 5-7 years: they want to get their money and then invest it elsewhere subsequently. Your interests as an Entrepreneur have to be aligned with the Angel Investor. You should speak about the exit when you are talking
with Angel Investors. You must plan for an exit for yourself. The Angel Investor needs to have an exit or they will not be interested in the deal. Talk about the exit in your pitch.
Angel Investors prefer deals from referrals: You should not just send an email, you need to interact with an Angel Investor. Networking will be essential for success. You need to create a referral network. It saves you a lot of time. They only look at it from a scalable view-of-point, the business has to have scale and growth. For an angel investor, scalability is very crucial.

2 types of investors

• Passive – Invests in 10 projects a year averaging £100K
• Active – £250K ex-entrepreneur seeking a job with no EXIT!

Tips to retain ownership
1. Include a share buyback scheme (called “ratcheting down”)
2. Reduce the risk whatever way you can (bootstrapping)
3. Get bankers money to support angel investment.

Where do you find an Angel Investor?

Investors.com run by “Oliver” 

Business Angel Networks (BANs): they screen the entrepreneurs, only put forward 5 every month with 5% success fee, and an upfront payment of £5,000 average. These agencies transform the business plan to make it stand up in front of the investors. They help channel, and drill down the business plan, etc. You need to get your business plan as public as possible. They entail Business Plan analysis, and transforming that content into investors.

Accountants: are gatekeepers who can help connect you with Angel Investors.

Lawyers: an investment lawyer doesn’t get a success fee, but they know lots of Angels. They are very low risk themselves, and so the deal must be excellent to move forward.

Other entrepreneurs & pitching groups of entrepreneurs: “What do you think of your deal, he’s doing well. Can you introduce me to your Angels?” Need to assess how much experience they actually have, etc.

Pitching Groups: tend to charge a fortune for pitching to a group. You are nervous when presenting, and then you discover that the room is almost 80% consultants. Pitching groups like that can be tricky, and wastes time. Do your research to find out which ones
are good ones. Try the following pitching groups: Great Eastern Forum, Thames Valley Network, or Oxford Investment Network.

Internet matching sites: but few get any funding this way. Put your deal up for free online. Haven’t known anyone to get funding that way. A matching sites supposedly gets 2,000 angels, but in reality there were only 14 angels. www.companypartners.com might
be acceptable but on the whole do not participate in Internet Matching Sites. In some arrangements, the entrepreneur pays a monthly fee for how many hours the business plan is exposed. This route doesn’t make that entrepreneur look professional. You can strip out the sensitive bits, but everyone can see everything for free, and there are better ways.

Small networking organisations: finding groups, become a member of OpenCoffee which is weekly meet-up, do get out there an mingle. Talking to people is the secret 50% of the time. You need to network, and talk to people. Beware of groups that accept you, and then ask for an upfront payment. Disclosing the Business Plan to as many valuable people as possible is acceptable because it will enhance the likelihood of finding a viable investor. You cannot be secretive. The pitch is about creating a teaser, not providing the chemical formula of your product.

The Big VCs

“The probability of an entrepreneur getting venture capital is the same as getting struck by lightning while standing at the bottom of a swimming pool on a sunny day. This may be too optimistic.” – Quote from a VC based in the US

If you want your own business then you will want that 70% for yourself and then 30% for the investors but it doesn’t mean you will have control in the case of working with VCs. VCs can control you with their contract, and they can do anything including fire you. VCs will try to control your business, and it is a fast ride on a bullet train…

Criteria for VCs: the risk has to be stripped out

• Proven business model
• High-flying team
• 1bn market size: real scale as a target for 1 billion pounds.
• Exit in 3-5years: VCs are always hot on exit because they will only have a 10 year
funding, and they want to make a 20% return. Need to do an exit in 5 years.
• 100m + exit valuation: they are looking for a major exit.
• Other people’s cash, expect to have 0.5%, and you need to know someone from Cambridge or Oxford.

How do you find a VC?

• Make sure your business is high-growth and profitable.
• Target VCs that operate in your sector. www.bvca.co.uk
• Find people who can introduce your deal. You would want to meet as many VCs as possible to leverage influence even if they have a term sheet. Meet with at least six different VCs in order to play various VCs off of each-other.
• Get a good lawyer.

The Small-Business VCs

• Deal size of £250k – £1m: they are not a soft option but it is do-able.
• Producing early revenue
• Credible team
• Scope to grow to £10million+
• Exit in 5-7 years
• £10m + exit valuation
• Other people’s cash.

Six Small-Business Friend CVs

•The Capital Fund (www.thecapitalfund.co.uk)
•The Technology Fund (http://www.londontechnologyfund.com/)
•Braveheart Ventures (http://www.braveheart-ventures.co.uk)
•MMC ventures (http://www.mmcventures.com)
•Endeavour (http://www.endven.com)
•Bridges Community Ventures (http://www.bridgesventures.com)
•Seraphin Capital Bridges Community Ventures (http://www.bridgesventures.com)

1. The London Fund (RVF):
Five or six years into their fund, they need to turn quickly to make an investment. They don’t need a business plan, and they have £50million fund. You must apply online and they have a weekly meeting looking at the possible firms. You do not need a referral.

2. The Technology Fund (http://www.londontechnologyfund.com/)
The London Technology Fund (LTF) is London’s specialist investor in new technology companies. It is focused on the funding gap for new, high growth technology companies based in Greater London. It bridges the funding gap by leading and building a syndicate of investors or by completing the gap in an existing syndicate. The Fund is happy to work with investors already known to a company or to help entrepreneurs find investors. It has developed a streamlined investment process with an initial web-based application. The application helps entrepreneurs identify and provide the essential
information LTF needs for prompt decision-making.

3. Braveheart Ventures (http://www.braveheart-ventures.co.uk)
Braveheart Investment Group plc is an investment company that makes and manages investments in British businesses. Braveheart was formed in 1997, by four Scottish businessmen, as a co-investment vehicle so that they could pool their money and
knowledge to reduce risk. Investments are made in young emerging companies, most of which are not listed on the London Stock Exchange at the time of investment.
Investments are a mix of technology and more traditional businesses and range from start-up companies to businesses in pre-listing situations. Typically ten investments will be made each year out of several hundred-business plans received.

4. MMC ventures (http://www.mmcventures.com)
One of the top firms investing in smaller pre-VC deals. MMC Ventures invests between £0.5 m and £2.5 m in initial funding rounds. MMC typically invests in pre-profit companies where MMC is the first institutional investor. MMC Ventures’ capital comes
from two sources: a value adding syndicate of experienced businessmen and a managed fund that co-invests with them.

5. Endeavour (http://www.endven.com)
Endeavour Ventures is a venture capital firm focused on providing sophisticated and high net worth clients an unrivalled selection of unquoted investments. Endeavour Ventures introduces unquoted investments of between £200,000 and £2,000,000 in growth companies with real prospects and selected other investment opportunities, such as property, to investors. They then provide an on-going service to keep investors up to date with their investments.

6. Seraphin Capital

7. Bridges Community Ventures (http://www.bridgesventures.com)
Bridges Community Ventures are all about social VCs starting in a deprived area. Bridges Ventures is a privately-owned venture capital company with a social mission. All the funds raised aims to achieve a social purpose as well as financial returns to investors.
The size of the fund is £115M. They are looking for deals of £150K to £10M which can deliver strong social benefits either through their geographic location in underinvested areas or through their sector or approach, for example in healthcare, education and the
environment.

8. Noble Investment Bank (http://www.noblegp.com/nfm/npe)
They take a longterm view and invest between £0.5m and £5.0m over the life of the deal. The team is a generalist investor with no specific sector focus. Recently it has invested in a range of transactions across a variety of industries. The team specialises in
providing venture and development capital, either equity and/or debt, to dynamically growing companies, across Europe and the UK, with a focused business plan, strategy and exit strategy within 5 years. This fund is for companies that already have developed
sales and does not provide seed capital or start up finance.

9. NESTA Investments (http://www.nesta.org.uk/)
NESTA is the National Endowment for Science, Technology and the Arts. The largest single endowment devoted exclusively to supporting talent, innovation and creativity in the UK. The mission is to transform the UK’s capacity for innovation. NESTA invest in early stage companies, inform innovation policy and encourage a
culture that helps innovation to flourish. Invest directly in high-growth start-ups with innovative technologies looking for £250K and over.

GATEKEPPERS

• Angel networks
• Lawyers
• Accountants
• Matching websites
• Pitching events
• Crowdfunding

Crowd Funding: (A little more about this emerging trend)

Suited for creative industries: “Marillion” in 2007 got fans to fund a £40,000K music Tour from the general public.

Legal constraints: it is illegal to go around and ask people to fund you, the FSA will be on you quickly. Legally there are only 2 types of people you can approach are:
a) corporate finance people in VC houses trading in that area, or
b) High Net Worth Individuals: people who can afford to invest.
You used to have to have them sign a document. You can now ‘self-certify’ which basically says that you asked for funding. You couldn’t stand up in a room, and ask for money but crowd sourcing is circumventing this somewhat.

www.crowdcube.com:

Going about 6 months and found a way to get around crowd funding limitations, allow entrepreneurs to put a deal on their site. People can make donations up to £2000. They are allowed to legally sell to the general public through their platform. You can put your
business plan up on their website, BUT you need to push people to get them on the page, ie. you need to market, and cuts out the middle-man, if you get a good deal then you stand a chance of getting funding.

www.kickstarter.com

It is illegal to crowd source but not entirely with a certain kind of crowd sourcing. This group have funded a lot of deals, it’s more creative industries, and they have a show or documentary. Then they give it a certain time frame, and if they don’t reach the tipping point then everyone gets they investment returned. There are some crazy deals, which are not mainstream deals that get a lot of funding so it can be done.

www.fundingcircle.com

General public gives money for a loan, rather than an actual investment in this case.

Family and Friends (F&F)

Real business angels require due diligence for a loan, but with family, and friends there is less documentation, and it counts as your own money. Beware of Uncle Bob giving you £20K that they thought was equity rather than an interest free loan. After 5 years in business the person in the background is holding up new arrangements because they claim to have made a loan with the goal of equity, not an interest free loan. Get your payment in writing if it is loan interest free loan or other arrangement. This will prevent you from undue legal strain subsequently.
• F&F will take you on personal merit;
• F&F does not expect big pay-offs;
• Is often willing to commit cash quickly;
• Make sure they can afford to lose the money;
• Pay them back as quickly as possible;
• Warn them of the risks – ie. they could lose everything;
• F&F can be patient – not always though!

The Banker (Who are they lending to?)

It is very difficult to get a business loan. In fact, you may get thrown out the door, and have to come crawling back through the window. Banks will never give you money without a collator, which means you will have to put your assets on the line.

How do you find a Banker? HSBC used to do loans but in the last 10 years, they stopped doing it because, there are so many debts that could go bad, and they are trying to keep the existing debts a float in order to ensure the existing businesses are still working. The fact is that bankers are not focusing on startups as the risk is too high.

Maintaining existing businesses is what has been the preoccupation. The government paperwork is too extreme. It is very difficult to get a banker to come speak at entrepreneur events lately because only 1 out of 20 will get any support.

Visit as many banks as possible: You can even apply 6 times to the same bank, to 6 different managers, until you find someone in the same bank that will say: “Yes.”

Aim for the SLGS (enterprise Finance Guarantee) One option that is available is the Small Firms Loan Guarantee scheme. (http://www.companypartners.com/content/resource/sflg) Government covering these enterprises with the Enterprise Finance Scheme.

Think Cashflow: and your credibility determine whether they will support you.

Find a banker you “click with”: You want to have the decision-maker in front of you, and it has to be under the £25K barrier because that is the signing limit.

Overdrafts are better than loans: try to get overdrafts, which are better than loans. You need to consider getting at £5,000 overdraft, and this is very flexible.

Cheaper than equity capital: bankers are only interested in the cash flow.

www.firstfunding.org

Brokers funds it. These are convertible loans.

www.marketinvoice.com

You cash in your invoices, you bidding for your invoices. They also do a lot of great deals, they are doing of good work.

Alternatives to a Banker?

www.fundingcircle.com They are trying to replace banks, you ask for a loan for £100K, and they look at it like a bank loan. They have John Milton on the board, if you pass the screening, then they’ll put it on their website. When they put a deal up it gets funded almost immediately. There is a very small default rate.
• One year operation £10m loans raised.
• Apply for a listing – 15mins.
• Deal get credit scored (min 2 year trading)
• Members bid from £20 – £20,000
• Investors love it. 2 Weeks before bids are closed
• Funds transferred to business account
• Typical interest rate 8.5% + 3% fee.
• Downside is that you need 2 year trading for this option! Business with a turnover of £60K has been done. The less risk involved, the better interest you’ll get.
• www.firstfunding.org Brokers funds it. These are convertible loans.
• www.marketinvoice.com You cash in your invoices, you bidding for your invoices. They also do a lot of great deals, they are doing of good work.
• Can you use a collection of funds from a group of families, because there are business people that will collect £200,000 and each of the business owners can source the funding as their own for at least 5 or 10 startups.

Government Officials:

Slow…but sometimes win the race. One person was looking for a grant and he hadn’t done anything with the project in lieu of acquiring a grant…. Find someone who knows the grant area, and an expert that can guide you down that path, understand the politics of
each of the grants, and how to make the application, DO NOT DIY.
• Time consuming;
• Usually a small player in the funding game;
• The DTI has developed the Research & Development Grant (this replaces the
SMART scheme) – Up to £500K;
• DTI – Geographical funds;
• European Funds.

The Entrepreneur:

Saving: you want to look like an outsider to the angel investor. This is different from what the media and press will tell you. A smart investor won’t put a whole fund on one business, so do not do so with yours. The chances are that your business is a learning
experience, and you should not expend all finances.

Personal loans: don’t go there, if you put your house, and everything you have, it is considered very imprudent. Personal credit cards: don’t even think of the Credit cards, and that’s insane.
Story of the man starting a club –
•Approached a 100 hot entrepreneurs in a newspaper pull out
•Send exec summaries to nearly all 100
•Obtained 3 meetings
•Secured finance from one investor
•The investors/entrepreneur had valuable contacts and experience
Story of man approaching Bill Gates via e-mail for travel.com company
•Moral of the story – successful entrepreneurs often become angel investors.

The Art of Bootstrapping

It’s about managing the cashflow: in the approach you should take ages to pay out people because that cash is an interest free loan. Build a business to that is scalable, try to survive, and work this out in one or two years. Need to try to work out to keep that cashflow, you need to keep the cashflow in the game long-enough until you work out an investor situation. You need to survive the first year, often so learn how to manage cashflow.

Famous Bootstrapped companies (values adjusted to reflect inflation)

•Larry Ellison from Oracle – Started with £2,000 of his own capital.
•Dennis publishing of loaded magazine and PC world started with less that £100
•Anita Roddick – Started “Body Shop” with £5,000 from an Angel investor
•Tom Hunter founder of Sports Division – Started with £200
•“Ben & Jerry`s” ice cream, started in a rented disused garage in Vermont, US with less
than £10,000.
•Rockefella started with £44,000 and went on to become the worlds richest man
•Amazon started with less than £5k before raising £200K from family and friends.
•“Subway” founder started with less than £2K

Advantages

•Can start generating cash quickly on small levels of finance
•Can learn from mistakes cheaply
•Gives amazing insights into your business
•Helps raising funds about 20x easier, and reduces risk to investor
Help the founders retain large controlling stakes of the company

Alterative Sources of Capital

1) Vendor Funding: as stated above, use suppliers money as an interest free loan. If you get the cash upfront then you can use that cash, and hold off the suppliers. In other words, take ages to pay back the supplier. This is known to fund an entire business. If you have a 30-day period to pay a supplier then you have a 30-day
interest fee loan effectively. You can stretch that to 60-days or 90-days. Bankable companies can afford to pay people later. The problem is that the Vendors will chase you. If you give them enough sales then they will not pull out. If they are a small company they are rarely going to pull out.
2) Rental: People come up to investors and say that they need a £50K chunk of equipment, why buy it when you can rent it or lease it? You need to manage your cashflow until that business is proven, in order to justify that chunk of the business.
3) Factoring/Invoice Discounting: (try www.marketinvoice.com) Rather than wait 90-days, you can get bids on the invoices. If the profits are okay, it might actually work out. There is 20% cut…
4) Half Purchase/Leasing: better approach to full purchase.
5) Overdrafts: try to push the overdraft with your bank to £5,000 then £10,000 etc.
6) Credit Cards: mentioned the credit card, corporate credit card. Then push it, use it a lot and it can be extended. If the worst scenario, unless you have a personal guarantee, you shouldn’t go after that.

The 4 Levels of the Game (Revisited)

The key is to launch your business, then get the funding. With the principle of bootstrapping, you don’t have credibility, so you should find someone who does, and do a deal with them. A lot of people think that bootstrapping is for a select person, but if you check the most successful companies, 45 out the top 50 in Times Magazine were bootstrapped companies.

Seed Funding – sources: Family, Friends and Government grants, Incubators, crowdfunding, competitions

£1K – £50K: Again, your business is an unproven concept, and the service/execution needs to be ironed out. You may have spoken to potential customers, and you have determined that there is a market. For an investor, the risk is very high.

Early Stage – sources; Angels, small funds, banks, invoice discounting, grants, asset finance, bootstrapping

£50K – £250K: Your business is proven, and you have revenue stream(s). The investment really does cap out at 250K because there is too much risk in the game. The business angel doesn’t want to concentrate their risk, so understand their position.

Mature Growth – sources: Ofex, AIM, Full Listing, Mezzanine Finance

£250K – £10million – You have a good team, and you are executing well. You have proven the concept works in the UK as a whole. You have a good team, and VCs are interested because the risk is lower. VC is not interested in risk…

End Game (The Exit) – Trade sale, MBO,MBI, and in about 2% of cases an AIM listing

You should aim for the quick exit from your own company.

Franchising: There is one other funding opportunity: franchising is huge. Build a system and can sell the franchise, but it comes with a high limitation for the franchisee. You cannot change the brand, execute within tight parameters. Trying to buy back franchises
isn’t easy, but it is worth investigating in certain industries.

So what now? (Develop your funding game.)
Ask Yourself:

1. What funding level am I playing on?
2. What players do I need to approach?
3. What tools do I need to win the funding game?
4. What are the next steps?

You build a robust business plan, fine BUT there are six essential tools…

Six Essential Tools (that will dramatically improve your chances)

1) USP: deals have to be unique. Only 20% know their USP, you can spend an hour in front of someone and not come to understand their USP, it needs to be really unique, and succinct. You should be able to explain yourself in 60 seconds.
2) Team: obviously need to have a solid team.
3) Proof of Concept: talk to customers, and reduce the risk as much as possible.
4) Executive Summary: it should be a marketing tool, not a summary of the full plan. You need to get yourself a meeting with an angel investor. This has to be a solid, and short executive summary, with a key focus on investor interests.
5) Valuation/Exit: A crazy man thinks his/her business is worth 5million, he is fixated, there is no risk stripped out of that valuation. You should never go over £1million pounds on your valuation. You need to produce sales ASAP.
6) The Pitch: you need to be face to face, and you have to have your executive summary printed in your head. You need to have a clear presentation. The pitch is a verbal calling card/executive summary. It needs to be a verbal element of the Exec Summary with clearly set out parameters and guidelines.

Fundraising for Fast Growth: October 13th, 2011

a. Intensive one day workshop, ambitious entrepreneurs, step by step approach, building the tools to attract funding, one speaker has been training Angel investors, industry contact and case studies, on getting support, small group – limited places so act quickly.
b. £120 standard (£85 with discount below)
c. 30% discount for past attendees.

Lessons from a Masters In Business Administration: Strategy Is Not Operational Efficiency

Strategy Is Not Operational Efficiency: You can run the best kebab shop in London, UK but if you are doing something that many people can copy, you are not going to make any money. You need a great strategy, but the first step is picking the right industry. Anyone can become a proofreader. The most profitable sectors in the US earning over 20% growth per year: pharmaceuticals, high-technology, financial services, discount department stores, and oil. The worst industry is airlines. Picking the right industry, one with a sound structure, where your chances of making a profit are highest, was where good strategy begins. Note that you should be interested in what you are doing with your time. Passion is also important.

[This is a synopsis of several books on the MBA experience including What They Teach You At Harvard Business School by P.D. Broughton]

Business Is Like A Grilled Cheese Sandwich + Tomato Soup

Grilled Cheese Sandwich Business

Most of the value is in the cheese, the bread and the accompanying tomato soup. Mmm, that all tastes toooooo good. And when customers taste the food, they think “that was a great sandwich” and very rarely think “some Chef made that.” We rarely see the Chef to begin with. The quality of the ingredients is essential. It’s the reason Italian food is so good when, surprise, you actually go to Italy. The Chef is still important however.

The angry cheese and the management that gets all the credit

 

Strange Metaphor

Just like a good grilled cheese sandwich, you need great employees to help create awesome products. However, the cheese is not going to convince the bread to get into the frying pan together. You need that Chef. The Chefs are the management. What frustrates workers is that they are the ones that produce the quality outcome as the cheese the bread and tomato soup. It doesn’t seem fair and it probably isn’t that the cheese and bread don’t get the credit for the amazing meal. The chefs do. From Steve Jobs to George Lucas to Richard Branson, the chefs get a the bulk of the credit and the value from orchestrating the meal that is any business. They just sit in the kitchen while customers eat the cheese and bread and tomato soup that are the true value of the transaction. This is why social democratic values will always live on. It doesn’t seem fair that the cheese that makes the sandwich awesome gets paid less than the chef. It’s really hard to see whether the Chef made the meal awesome or the ingredients themselves are where the value lies…..

Grilled Cheese Sandwich is a Business Model

The difference in business (if there is one: sarcasm) is that sometimes the cheese is smarter than the Chef. But if the chef doesn’t listen and just wants the cheese to stay flavourful, then management misses out on something awesome. In fact, recognising when someone who is not a manager is way smarter than the managers can lead to the opposite effect which is that the Chef replaces that cheese. I think I’ve taken this metaphor too far….

Soviet Space Art

LET’S SAY THAT BUSINESS IS RATHER LIKE GOVERNMENT. In the case of the USSR’s space industry, the government was in the business of captivating the imagination of a nation, to inspire young children to study science, and to make the USSR a interplanetary power. Okay, that’s a bit extreme. Great art is used to evoke feelings of pride. However, like Pets.com or many other startup business, the Soviet Space program rushed launches before sufficient tests were conducted; comparable to a company buying an office before having any cashflow. In Silicon Valley, the running joke was that a startup that bought this highly stylised chair at $600 each was doomed upon purchase. In London, there are still startups with decorations, mascots but no cashflow. It’s important to dream imaginatively, but art is supplementary rather than complementary. The USSR should have invested more in testing the N1 Rocket and computer technology and less on the propaganda around it. By the 2000s, the Russian space program became the dominant channel for delivering supplies to the international space station…


Linchpin: Are You Indispensable? Part XIII

The GENERAL CRITIQUE of LINCHPIN:

Seth Godin does not provide detailed solutions to practical employment dilemmas of the functionary kind. Godin is abstract, a marketer, and he’s a journalist without the experience of working in an Amazon or Apple corporation. His advice that linchpin’s should be artists seems so out of touch with what it is like to work in startups, or businesses generally. At one point he says, schools should teach two things: 1) solve interesting problems, and 2) be a leader. The only problem is a scarcity of leadership positions that are sustainable, Godin. The Functionaries Paradox is that if everyone believes that they are a leader/entrepreneur, it becomes extremely difficult to get anything done in a business team. There are still millions and millions of functionary roles that need to be completed in Western society. Godin, in fact, is speaking to a very small pool of risk taking entrepreneurs but trying to mask it as if a midlevel manager in a corporation can be linchpin without compromising their execution of tasks, and their functionalist remit. Entrepreneurs or linchpin’s as he calls them are UNEMPLOYABLE. He provides no examples of linchpin from bankers to lawyers or doctors, he is talking about entrepreneurs and more loosely about marketers (whom he loves as it’s what he does) while pretending that being a linchpin can work in any business. Marketers frequently under emphasize the scarcity of resources, the scarcity of eye balls, and time which limits the number of Squidoo.com users, or in the case of the linchpin, the number of leaders that can actually aquire leadership positions that are meaningful. Godin can’t say that he’s talking to a small group of risk takers, because then most job-stability focused people will put the book down. He’s repackaging the ethos of the entrepreneur, and more vaguely the artist.

(This is a series of posts on Seth Godin’s Linchpin: Are You Indispensable?)

Linchpin: Are You Indispensable? Part XII

The GENERAL CRITIQUE of LINCHPIN:

Seth Godin’s Paradox ie. the Functionaries Dilemma. Seth Godin is a pop-culture synthesizer, who repeats himself over and over again as if his audience is truly “lizard brained.” Everyone knows he is deducing these arguments based on his macro-observations. He has limited experience in successful business management having created a mediocre enterprise like Squidoo.com. His primary goal is to convince the reader that you can be the linchpin without his giving substantive advice on how to be one in a practical context. His advice is “to be an artist,” along with a series of similar “be different” slogans. Linchpin is a marketing pep-talk designed to suggest that his target market is ANYONE who is working today. In reality, he is talking about entrepreneurs because most entrepreneurs espouse exactly what he is saying, and Godin wants to convince others to join in the innovative. By pretending that the pie is unlimited, he can argue that his readership can all participate in this linchpin ethos. But framing his book in the way he does, Godin is able to build a larger target market of book purchasers (to use his marketing-think). The trick is that functionaries are very useful for entrepreneurs because those workers never realize that they could do what the entrepreneur is doing. It is difficult to occupy that same space as the leader/entrepreneur/artist inhabit. As with much of his marketing-think, Godin is preaching to the converted who already understand his points, or preaching to the lizard brained who are not going to apply his advice anyway.

Linchpin: Are You Indispensable? Part VIII

(III) Workers are interchangeable, therefore we should strive to be linchpins, irreplaceable within the work force. (continue)

A day’s work should not be a remuneration from work = pay. We are willing to sell ourselves so cheaply. Is that it? The transaction is over? The relationship is unfair. Godin is asking you to stop following instructions, and start being an artists? Someone who dreams up new ideas and makes them real, to stop being a cog, and act like a human being. You should become an artist at work. The marketer can also be an artist Godin contends.

It’s not that you can’t, it’s that you won’t be a linchpin. Godin believes that being the linchpin is the most financially responsible choice, and not a risk whatsoever. The new American dream is a lie. The thinking that “that’s not my jobs” is destructive. Employees are more willing to give refunds then deal with conflict: a) keep your head down, b) follow instructions, c) show up on time, d) work hard, e) suck it up.

What do employees really want? Top ten things:

  1. Responsibility, and challenges,
  2. Flexibility
  3. A stable environment
  4. Money
  5. Professional development
  6. Peer recognition
  7. Stimulating colleagues and bosses
  8. Job content that is exciting
  9. Organizational culture to achieve
  10. Location/community.

Notes from Seth Godin’s Lynchpin

Linchpin: Are You Indispensable? Part VII

(III) Workers are interchangeable, therefore we should strive to be linchpins, irreplaceable within the work force.

Suppliers Dilemma for Workers

People have been burying their genius, or misallocating themselves in order to fit a round-peg into a square hole. By not being innovative, these labourers have limited bargaining power against the suppliers which Seth Godin refers to as the PERL (Percentage of Easily Replaced Laborers). These people are easily replaced, yes, but that is exactly what management wants if their short-term goal is to restrict costs, and drive wages down.

The linchpin is between management and labourers. It is now easier to find people in self-organized online systems. Godin believes that we can all create our own factories…Karl Marx and Adam Smith both agreed that there are management and labour; management owned the machines, and labourers followed the rules. Godin believes that the 3rd group is called the linchpin between management and labourers. They are creating new products more effectively, creating new ways to express themselves. 3D printing is an area where new growth may be developing in the near future. Realistically, the linchpin is not likely to be between management and labourers. Godin is basically talking about entrepreneurial people within an organisation.