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[ Music ]
>> Steven Jobs figures heroically in the history
of American entrepreneurship.
At the age of 22 he founded a company called Apple Computer
and proceeded to grow it into a $2 billion business.
In the spring of 1985 he lost a power struggle inside Apple
and left the company he had created.
He spent the summer considering his next move
and resolved to begin again.
In September he started a new computer company
with his own money.
With characteristic flair, he called it NeXT Incorporated.
This morning at its offices in Silicon Valley, California,
the company is about to get a first look at its new trademark,
the signature it hopes to make familiar around the world.
The designer, Paul Rand, created the logos for IBM,
Westinghouse, UPS, and many others.
Rand doesn't normally work for infant companies even
if they could afford him, but NeXT isn't an ordinary startup.
>> The idea is to, please don't open,
don't look at the back first.
This is the front.
And don't get scared, this is not the design.
[laughter] The reason I did this was to sort of floor Steve
when he saw it, you know and think,
Jesus 100,000 bucks down the drain.
[laughter] [Inaudible]
>> Jobs has had a sneak preview of the logo and loves it.
As he waits for a verdict
from his staff he can hardly contain his excitement.
Assertive as he is, he values consensus.
Most of these young computer and software designers were
on the team that developed the Macintosh.
They left secure jobs at Apple to follow their boss
in pursuit of his new vision.
Steve's goal is to transform the learning process at the college
and graduate school level with a powerful computer
and a new kind of software.
>> And we decided we wanted to start a company that had a lot
to do with education, and in particular, higher education;
colleges and universities.
So what our vision is is that there's a revolution
in software going on now on college and university campuses,
and it has to do with providing two types
of breakthrough software.
One is called simulated learning environments.
It's where you can't give a student
in physics a linear accelerator.
You can't give a student
in biology a $5 million recombinant DNA laboratory
but you can simulate those things.
You can simulate them on a very powerful computer,
and it is not possible for students to afford these things.
It is not possible for most faculty members
to afford these things.
So if we can take what we do best which is
to find really great technology and pull it
down to a price point that's affordable to people,
if we can do the same thing for this type of computer
which is maybe 10 times as powerful as a personal computer
that we did for personal computers,
then I think we can make a real difference
in the way the learning experience happens
in the next five years.
And that's what we're trying to do.
[ Waves crashing ]
Companies come and go at the crest of the wave.
I mean you know IBM had their day way back when when they,
you know, they were at the crest.
>> In December, 1985, in business for just 90 days,
Jobs and his 11 employees hold their first retreat.
Company retreats like this are the continuation
of a tradition Steve established at Apple early on.
Watching him in action at these brainstorming sessions is an
opportunity to observe him at his lucid best
as a company builder and motivator.
>> Slicing into the future.
>> His opening remarks reveal his faith in high technology
and his idealism, an unusual combination
that is part of his uniqueness.
In effect, he is planting the seeds
of a new corporate culture.
>> More important than building a product, we are in the process
of architecting a company that will hopefully be much,
much more incredible-- the total will be much more incredible
than the sum of its parts.
And the cumulative effort of approximately, you know,
20,000 decisions that we're all going to make
over the next two years are going
to define what our company is.
And one of the things that made Apple great was
that in the early days, it was built from the heart.
Not by somebody who came in
and said I know how to build a company.
Here's what you do.
Da da da da da da da.
It wasn't built that way.
It was built from the heart.
Now unfortunately we didn't always use our heads
and we can do better in many respects because we are wiser
and smarter and know more and those kinds of things.
But one of the most important things,
one of my largest wishes is that we build NeXT from the heart
and the people that are thinking about coming to work for us
or buying or products or who want
to sell us things feel that, that we're doing this
because we have a passion about it.
We're doing this because we really care
about the higher educational process,
not because we want to make a buck.
Not because, you know, we just want to do it to do it.
>> Jobs can be overbearing and impatient,
but this team knows what to expect
and is not easily intimidated.
They are smart and they are focused.
And their preferred language is computer ease.
>> They actually provided analogous
to [inaudible] small talk.
[Inaudible] provided you a way to drop actually
into [inaudible] and program the actions that happened
when you double clicked on an icon
or when you dropped something on an icon.
>> We have to create a product that's an order
of magnitude more powerful than the current generation of PCs.
>> For two solid days the group listens
to progress reports from each department.
The goal is to arrive at design decisions, production deadlines,
and a marketing strategy aimed at selling on college campuses.
>> is define the problem.
>> The point is that June, July,
and August are the timeframes when people do work.
When they, when the school's out and when the people
or researchers and the staff that deal
with making computing happen for September,
that's when they do work.
>> That is, that's like a bomb run.
You don't change your target when you're in the bomb run.
>> From the sidelines, Jobs probes and challenges.
He has a remarkable ability
to identify the conclusions implicit
in what the others have to say.
>> So really the next 90 days are real important.
>> We are going to make it or break it based
on whether we can provide products to higher education
and services and relationships to higher education
that no one else provides.
And I think we ought to spend 100%
of our time thinking about that.
And if we can't do that, then we ought to go broke.
There needs to be someone who is sort of the keeper
and reiterator of the vision
because there's just a ton of work to do.
And a lot of times, you know, when you have
to walk 1,000 miles and you take the first step it looks
like a long ways.
And it really helps if there's someone there saying well we're
one step closer.
You know the goal definitely exists.
It's not just a mirage out there.
So in 1001 little, and sometimes larger ways,
the vision needs to be reiterated.
I do that a lot.
>> There was the price one, the schedule one--
>> The technology.
>> and technology.
>> Yeah.
>> Jobs continually interrupts to focus the lens
of his vision on priorities.
By the end of the first day the team has established the
critical importance of keeping the price of the computer
within the reach of students and professors
and bringing the product to market by spring 1987.
A survey of college campuses has indicated
that the new computer should sell for no more than $3,000
to be considered affordable.
Since college buying takes place in the summer, Jobs is concerned
that a failure to have their product ready
by spring 1987 will delay the company an entire year.
>> If we don't deliver this by spring '87,
we're out of business so my first priority is
to make sure this damn thing is out by spring '87.
>> I think spring can basically push out to summer,
but I also hear that that is number one.
>> Right.
>> I guess I disagree with price being the second thing
because unless we have,
unless we have this technology that wows people--
>> Um hum.
>> we're not going to have a firm foundation
that people are going to buy from.
And I think people are going to be a lot more flexible saying,
well jeez, this runs three times faster, seven times faster than,
you know, a computer--
>> Well what's the highest we could go here?
>> Oh well [inaudible] technology jumps ahead in price.
>> Well we couldn't make this 5,000.
I think we're, they didn't say
if you made it go three times faster we'd pay 4,000.
They didn't say that.
>> No they said [inaudible].
>> That's right, they said if it's $3,000 it's a hot product.
>> But they were--
>> They said you're over 3,000, forget it.
>> Yeah.
>> That that's their magic number.
They've also told us that nobody else says they can do that.
And they think that's a really big number.
Now, whether it is or not in reality, who knows?
>> Um hum.
>> Whether it is or not in terms of their commitment--
>> Yes.
>> to push us, we've established that.
>> Um hum.
>> That's right.
>> If we really do believe that we have to ship this by summer
of '87, then how are we going to move that up?
I don't think price is going to change the schedule that much.
I think the real risk is
in the technology, it's not in the cost.
>> Yeah.
>> There's another option, it can go to the spring of '88.
>> Yeah, we could.
[laughs] But the problem is if we do that, then the--
>> Then [inaudible].
>> Well wait I think--
>> No that's not the worst thing.
The worst thing is, every, the world isn't standing still,
so by the spring of '88 well we want color.
The technology window sort of passes us by
and all the work we've done we throw
down the toilet and we start over.
And you know since we've proved we can't do something great
in 18 months, why should we believe we could do it,
you know, a year later?
>> I don't care what you're saying, reality--
distortion is reality distortion
and its has its motivational value and that's fine.
And I think it has a very strong point
and a very important value.
However when it comes to the, when it comes
to that date affecting the design of the product,
that's when we get into a rut.
Real, deep, shit because if we are unrealistic about this date,
we make design decisions that we have to then go over, reiterate,
throw out, start all over again.
>> Um hum.
>> And you told us yesterday we have a past
and unfortunately some of us can't get rid of that past.
And I remember a past where we put out a list this long
about the software that was going to ship with our product.
As you recall, the list was formidable
and we all thought we could do it in 12 months.
>> Um hum.
>> 15 packages, right?
>> So maybe what we ought to do though is say--
>> And--
>> see, I think we have to drive a stake in the ground somewhere
and I think if we miss this window then a whole series
of events come into play.
We can't sell enough units in '87 to pay
for our operating costs, okay?
You know word gets out that we're not doing that well.
A lot of the credibility starts to erode.
Da da da da da da da da da.
I don't know, you know, you could make
up all these fantasies.
We've got to have a stake in the ground.
>> Okay the problem I've got though is one,
will everybody believe that the stake is in fact in the ground?
And secondly, when software comes back
and says what they can do by summer or spring of '87,
will they be telling us the truth?
That's what I'm worried about.
>> [Inaudible]
>> One of the things--
>> Well, yeah.
>> Yeah my, that's exactly my point.
We've got a person here that said he can do a word processor
in six months that's taking three years.
>> Well George I can't change the world, you know?
What do you want me to do?
What's the solution?
>> I think the--
>> Yeah I mean I don't want to hear just
because we blew it last time we're going
to blow it this time.
>> But you see what we can learn is--
>> What I want is probably irrelevant.
I mean there are certain realities here,
both psychological and market, that are going to come into play
in my own personal judgment.
And I think this is a window that we've got.
We've been given it, and thank god we've been given it.
Nobody else has done this.
It's a wonderful window.
We have 18 months.
So I don't think we have a company if we don't do this.
No matter what I say or anybody else says,
that is my deepest belief.
If we don't do this, we will not be able to attract great people.
We will not be able to retain the ones,
some of the ones we have, and you know, it just won't be us.
>> And I find myself making lists of things we don't know
and then I remember that our company is 90 days old
[laughter] and I look back to all the things we do know.
And it's really phenomenal how far we've come in 90 days.
>> Boy, I'd forgotten how much work it actually is
to start a company.
It's a lot of work, and you've got to do everything.
You've got to come up with a name, you've got to come
up with a logo, I mean in addition
to designing the product.
You've got to figure out what to design.
You've got to figure out how you're going
to get it to the marketplace.
You've got to do a part number system.
You've got to go get bank accounts.
You've got to set up charts, general ledgers,
get a management information system,
get a little kitchen setup, get a coffee maker.
All this stuff.
>> Where are we going to?
>> Three months later the company returns to Pebble Beach
to hold its second retreat.
Progress has been made.
The first mockup of the new computer is
in the trunk Steve is carrying.
But the flush of excitement that animated the first days
of startup has given way to the pressure
of solving actual problems in time to meet critical deadlines.
The minute Steve begins to deliver his traditional sayings
of Chairman Jobs, it becomes clear that the mood
of this retreat will be different from the first.
>> Well my first saying is that the honeymoon is over.
[laughter] All of those wonderful things that we got
for just being, are now sort of just old news.
We are like every other startup.
We've been a company now for six months and yes you could say
that well we had a, you know, a lawsuit for four of those months
and we had this and that,
but the bottom line is the world doesn't really care.
What the world cares about is what we produce.
We've been a startup for six months.
We've been spending money like we've been a startup
for six months, and in some areas we've really produced
a lot.
We've got a lot to show for six months in some areas.
In other areas we don't have a lot to show for six months.
So I hope that throughout this retreat we tend to make sure
that our feet are on the ground and we realize that we're going
to be judged like every other startup from here on out
and that is by what our product is and how timely we bring it
to market, not on the fact that we're NeXT.
Not on the fact that we were sued.
Not on the fact that we're really good people
who had a lot to do with Macintosh.
That stuff's irrelevant at this point.
>> What we'd like to do is step back and minute form the point
of view of what's feasible.
Ignore that--
>> In December the group concluded they must ship product
in 18 months and agreed they could be ready.
Three months down the line this seems questionable
and there is frustration in the room.
>> It's totally useless as far as I can see to talk
about how you're going
to implement something unless you know what it is you want
to implement.
>> Yeah I agree--
>> So that's what I'm not getting.
I'm not getting it from marketing.
I'm not getting, you know, a clear idea
from anybody really what the features are
and what is this thing that we're talking about doing.
>> It ain't my job.
And I don't, if I was him it wouldn't be my job,
it'd be your job.
>> You know it isn't like this, it should be something new.
>> That's one--
>> But I mean I agree.
Let me back up--
>> So somebody's got to say here's what we can do
and we can make it happen and here's the level
of thing we can ship in 16 months.
And what I hear him saying is well anything more
than a [inaudible] forget it,
and boy that just makes me smoke.
It just seems like we're,
we're in this really difficult time where,
I don't know you know, I mean I sort
of think another month's going to go by
and there's still not going to be anything running
on the sun that's very interesting.
And another month will go by
and there still won't be anything running and,
it just seems like it's just,
and I guess maybe that's just the way it has to be.
>> I think we're going to have to--
>> So forget about [inaudible] fuck everything after shipment.
Just look to shipment, you know?
Marketing's out of line.
There's too many people in marketing.
>> Figure about $250 for health and life.
Before we cut the facilities budget, it's $1000.
>> That's, but that's not where it's going--
>> Money is also emerging as a problem.
In return for 70% of the stock, Jobs has committed $7 million
of his own money to carry the company to product launch.
But at the present burn rate,
it appears that that amount will be insufficient.
The unpleasant task of cutting expenses must be faced.
>> Rather than--
>> All this other stuff that we,
when in the final analysis we really don't care
about that much, is what's costing us the money.
>> There are not million dollar buckets out there to identify
that we need spending cuts.
There's lots of lots of hundred thousand dollar buckets
and it's going to take everybody
in this room doing a mindset change.
>> We just go out and we buy branny new Macintosh's
and branny new hard disks for everybody and it's not
at all cle- I don't think we're getting great deals
on that stuff.
We're not scrounging.
>> Well no one--
>> We're not--
>> Mac owners bringing their Mac from home.
>> Well we're not, I mean we used to be,
we used to find people to get us really good employee discounts
on things and everything else
and we've stopped scr- I mean we stopped--
>> Nickel and diming.
>> Nickel and diming for that stuff.
And it all adds up.
>> And I think the other thing is we signal deep pockets
out there.
>> Yeah.
>> Every vendor that comes to us, every person that comes
to us for recruiting, everything,
they expect these $20 $30 million behind us
and it isn't there and it's not going to be there.
>> So you can kick yourself in the butt but--
>> Now's the time to change.
>> I guess, now's the time to change.
And one of the things I don't see is, I don't see it
in myself, I don't see it in the re- in enough of the rest
of us is I don't see that startup hustle.
In other words, if we zoom out at the big picture,
it would be a shame to have lost the war
because we won a few battles.
And I sort of feel like I and some of the rest
of us are concentrating too much on the smaller battles.
>> We have to keep--
>> and we're not keeping the war in perspective
and the war is called survival.
The war is called not run out of money
until we get our product on the market.
>> Steve Jobs had built a major company by the time he was 28.
According to some, he had even created the personal
computer industry.
In any event, he was a wealthy man and was acknowledged
as a master entrepreneur.
What is it that drives him at age 31 to begin all over again?
Part of the answer seems to be his need to feel
that he is contributing to history.
>> I felt it the first time when I visited a school.
It was like had third and fourth graders classroom one time,
and they had a whole classroom full of Apple II's
and I spent a few hours there and I saw these third
and fourth graders growing up completely different than I grew
up because of this machine.
And what hit me about it was that here was this machine
that a very few people designed--
about four in the case of the Apple II--
and then they gave it to some people that didn't know how
to design it but they knew how to make it, to manufacture it,
and they could make a whole bunch of them.
And they gave it to some people that didn't know how
to design it or manufacture it
but they knew how to distribute it.
And they gave it to some people that didn't know how
to design it or manufacture it or distribute it
but they knew how to write software for it.
And gradually this sort of inverse pyramid grew,
and when it finally got into the hands of a lot of people,
it blossomed out of this tiny little seed.
And it seemed like an incredible amount of leverage.
And it all started with just an idea.
And here was this idea taken through all
of these stages resulting in a classroom full of kids growing
up with some insights and some fundamentally different
experiences which I thought might be very beneficial
to their lives because of this germ of an idea a few years ago.
And that's an incredible feeling to know that you had something
to do with it A, and B to know it can be done.
To know that you can plant something in the world
and it'll grow and change the world ever so slightly.
[ Music ]
>> Whether NeXT can be a viable business is something only time
will tell.
But Steve Jobs' passionate commitment
to his vision is clear.
And his certainty that it can be achieved
and is worth achieving is a conviction to be observed
in all successful entrepreneurs.