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UPDATE NOVEMBER 2012: On the day this article was written, Apple Computer became the most valuable corporation in the world. Less than two months later, on 11 October 2011, its co-founder and chairman Steve Jobs (56) lost his long battle against cancer. Apple has continued to thrive after Job’s death, the market cap rising 57% in the subsequent year to $537bn – as much as Google and Microsoft combined.
August 11, 2011
The world this week celebrated the power of unreasonable people. Apple Inc, a computer and consumer electronics business started 35 years ago by a university dropout, became the most valuable company on earth. It has overtaken oil major Exxon Mobil, leaving other contenders PetroChina and ICBC Bank far behind.
Apple’s place on top the global pile was overdue. Money managers say despite its staggering $340-billion valuation, the company is actually undervalued by normal investment yardsticks. The shares trade at a discount because of worries around the health of its leader, the founder and unreasonable person in chief, Steven Paul Jobs. After overcoming pancreatic cancer in 2003, he took six months off in 2009 for a liver transplant. This year the inspiration behind the iPhone, iPad, iPod, Apple Macs et al announced an indefinite leave of absence for health reasons. Investors fret that the 56 year old won’t return.
Don’t count on it. Steve Jobs has long possessed an appreciation of his own mortality. In 2005 he told Stanford University students: “For the past 33 years, I have looked in the mirror every morning and asked myself: If today were the last day of my life, would I want to do what I am about to do today? Whenever the answer has been “No” for too many days in a row, I know I need to change something. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose.”
It’s a philosophy that’s served him well. The son of unmarried Wisconsin University students, he was raised modestly by adopted parents in the apricot orchards of what became Silicon Valley. Jobs dropped out after just six months at a university his parents couldn’t really afford, opting rather to explore his spirituality by backpacking across India. At 21, together with Steve Wozniak and Ronald Wayne, he started the company that transformed the personal computer sector, first with the Apple II and then the Mac.
Like so many great entrepreneurs, Jobs is tough to get along with. He famously enticed PepsiCola’s marketing wunderkind John Sculley to stop selling sugary water and “come change the world”. Two years later they fell out so badly the Apple board was forced to choose between them. It kicked Jobs upstairs – and at the ripe old age of 30, he left the company he’d founded, selling all his shares in disgust.
Thirteen years later Sculley had been fired, the Apple share price was in freefall and a $700m quarterly loss loomed. A desperate Apple board paid an effective $1bn for the company then 43-year old Jobs had created. That business, NeXT Computers, built the machine used by the Internet’s “creator” Tim Berners-Lee. It also developed software that’s now the core of the operating system for all Apple computers worldwide. But the biggest benefit for the once teetering business came by bringing Jobs back home. And the rest, you might say, is on your desktop (briefcase, pocket or sound system).
This amazing man transformed no less than five industries. Back in the 1980s he changed publishing through his Apple Mac, software and the first affordable laser printer. Jobs’s iTunes and iPod turned the music industry on its head. The Apple iPhone revolutionized the cellular phone sector. Pixar, a company he bought for $10m during his non-Apple period, changed movie animation forever. And the Apple II, Mac, Powerbooks and now iPad have re-shaped personal computing. We need go back more than 200 years to Benjamin Franklin for a polymath who compares.
Secrets of his success? Good genes helped. Jobs’ biological father, Abdulfattah Jandali, a Syrian immigrant, became a professor in political science; his sister, Mona Simpson is a literature professor and novelist. Jobs’ laser-like focus doubtless played a big part as well. Ditto in-built cussedness when it came to anyone proposing he compromise standards. He also started with a simple, driving vision to “put a computer on every desk” at a time when such devices were unknown outside large organisations.
But the real inspiration comes at a more basic level, and is relevant to all, not just those in business. In his autobiography Odyssey: Pepsi to Apple Sculley recalls a twenty-something Jobs saying: “We all have short period of time on this earth. We probably only have the opportunity to do a few things really great. None of us has any idea how long we’re going to have, nor do I, but my feeling is I’ve got to accomplish a lot of these things while I’m young.” Really knowing we’re here for a brief moment in time brings perspective. And an urgency the human condition finds all too easy to sideline.
WORLD’S BIGGEST CORPORATIONS BY MARKET CAP
August 10, 2011
1 Apple Inc $340bn
2 Exxon Mobil $335bn
3 PetroChina $271bn
4 ICBC $221bn
5 Nestle $219bn
6 Microsoft $214bn
7 IBM $203bn
8 Royal Dutch Shell $199bn
9 Chevron $187bn
10 BHPBilliton $187bn
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