The dogged pursuit of reinvention is just as important as creation.
If you look at the world’s most valuable technology companies, you’ll notice something interesting. Not a single one invented the category of products they’ve come to define. The vast majority of their enormous profits come from markets they did not create.
Whether it’s Apple in smartphones, Google GOOGL -0.34% in search, Microsoft MSFT 0.09% in operating systems, Facebook FB 0.84% in social networks or Amazon AMZN 0.29% in ecommerce, when these companies launched, nobody could have predicted their eventual path to domination.
What does that tell us? For one thing, you don’t have to be first to be number one. But you probably already knew that. Far more important is that every one of these companies’ founders chose a ridiculously improbable path that flew in the face of conventional wisdom.
“Trust your instincts even when everyone else says you’re crazy,” is advice that’s easy to give and hard to follow. Challenging the almighty status quo to do what experts say can’t be done isn’t for the faint of heart. But that’s exactly what these founders did, ignoring the advice of the many and trusting their own focus group of one — or two.
The pundits thought Steve Jobs was absolutely insane to get into the dog-eat-dog cellphone business. In 2007, John Dvorak put into words what everyone was thinking: “Apple should pull the plug on the iPhone,” he wrote, as “there is no likelihood” it would be successful. He later called the iPad tablet a “giant iPod Touch” that would have nominal market impact.
Today, the iPhone is undoubtedly among the most successful products ever, generating more revenue than nearly every S&P 500 company. The iPad-dominated tablet market surpassed PCs in 2015, just five years after its introduction.
And let me tell you — everyone thought Apple was crazy when it opened its first retail stores in 2001.
Today, Apple stores are the most lucrative retail space in the U.S.
In 1998, Stanford graduate students Larry Page and Sergey Brin shopped their search engine to just about every venture capitalist and Internet company that would listen. They were repeatedly met with the same response: The world doesn’t need a stand-alone Internet search company.
Finally, one man, former Sun co-founder Andy Bechtolsheim, wrote a check for $100,000 and Google was born. But for a while, it looked like everyone was right; Google’s share of the search market was a dismal 7.8% in 1999.
Then, in October of 2000, the Silicon Valley startup launched AdWords. Who knew that the combination of search engine and advertising platform could create a business model that practically mints cash — and turn Google into one of the most valuable and powerful companies on Earth?
Way back in the summer of 1980, some suits from IBM approached a young software developer named Bill Gates about an operating system for a personal computer. Since Gates’ specialty was programming languages, he referred them to someone else. When that didn’t work out, he finally agreed to do it using a modified version of QDOS, which he bought for $50,000.
But instead of simply selling it outright for a quick profit, Gates licensed DOS to IBM on a non-exclusive per-unit royalty basis. Microsoft co-founder Paul Allen said the innovative licensing model was his idea, but that’s neither here nor there. DOS became Windows and more than a billion PCs and countless apps would be built on top of that ubiquitous operating system.
Of course, not every successful founder has a comparable story. But the select group of entrepreneurs who have built companies that truly change the way we live and work usually do, for one simple reason: The kind of vision required to disrupt markets on that scale is a rare thing. So rare that if these founders did not believe strongly in themselves, their companies would never have made it.
Don’t get me wrong. It takes a lot more than perseverance in the face of conventional wisdom to turn a startup into a business powerhouse. And having the courage, self-confidence and tenacity to trust your own instincts when everyone around you says you’re nuts will not, in and of itself, make you the next Mark Zuckerberg. But if you’ve got the talent to back it up, it’s a damn good start.