On September 16, 1985, Steve Jobs walked out of Apple, the company he’d co-founded in his parents’ garage nine years earlier. The board had sided with CEO John Sculley. Jobs was 30, publicly humiliated, and convinced he’d blown his one shot at greatness.
Twelve years later, Apple bought his failing computer company for $400 million and made him CEO. He spent the next 14 years building the most valuable corporation on Earth.
The firing, it turned out, was the best thing that happened to him.
Act One: The Garage (1976–1985)
Steve Wozniak built the computer. Steve Jobs figured out how to sell it.
In early 1976, Wozniak had finished designing a single-board computer he called the Apple I. He showed it off at the Homebrew Computer Club in Palo Alto and planned to give away the schematics. Jobs convinced him that was a terrible idea. They should start a company.
On April 1, 1976, Jobs (21), Wozniak (25), and a third partner named Ronald Wayne founded Apple Computer Company. To raise the $1,300 they needed for parts, Jobs sold his Volkswagen bus, and Wozniak sold his HP calculator.
They built the first batch of Apple I boards in the Jobs family garage, then sold 50 of them to a local computer shop called the Byte Shop for $500 each. The buyer expected assembled units. They delivered circuit boards. He paid anyway.
The Apple II Changes Everything
Wozniak’s next machine, the Apple II, shipped in 1977 with a keyboard, color graphics, and a plastic case. It looked like something you could put on a desk. When VisiCalc, the first spreadsheet program, came out for it in 1979, businesses started buying.
Apple went public on December 12, 1980. The IPO raised over $100 million—more than any since Ford in 1956. Jobs, at 25, was worth $256 million.
The Macintosh
Jobs had seen the future at Xerox PARC: a computer with a mouse and a graphical interface instead of a blinking command line. He threw Apple’s resources into building one.
The Macintosh launched on January 24, 1984, with a famous Super Bowl commercial directed by Ridley Scott. It was the first mass-market computer with a GUI. Jobs introduced it at a shareholders’ meeting; the machine said “Hello” from the stage and received a five-minute standing ovation.
But it sold poorly. The Mac was expensive ($2,495), underpowered, and couldn’t run the business software that made the Apple II useful. By 1985, Apple was losing money, and the board blamed Jobs.
| Year | Event |
|---|---|
| 1976 | Apple founded; Apple I released at $666.66 |
| 1977 | Apple II ships; Mike Markkula invests $250,000 |
| 1980 | Apple IPO raises $100 million |
| 1984 | Macintosh launches |
| 1985 | Jobs forced out after power struggle with John Sculley |
Act Two: The Wilderness (1985–1996)
Jobs left Apple with a handful of employees and started a new computer company called NeXT. He also bought a struggling computer graphics division from George Lucas for $10 million.
NeXT: Beautiful Failures
The NeXT computer, unveiled in 1988, was a black magnesium cube with rounded edges. It ran a sophisticated operating system called NeXTSTEP and cost $6,500—later raised to $9,999.
Almost nobody bought it. NeXT sold about 50,000 machines total before abandoning hardware in 1993. The company survived by licensing its software, but it never turned a meaningful profit.
Pixar: The Expensive Hobby
The Lucasfilm graphics division Jobs bought in 1986 was renamed Pixar. It made high-end graphics computers that sold even worse than NeXT machines. Jobs poured in more money year after year—eventually $50 million—and watched it bleed.
But Pixar had John Lasseter, an animator Disney had fired for pushing computer graphics. Jobs let Lasseter make short films to demonstrate the hardware. Those shorts kept winning awards.
In 1991, Disney signed Pixar to produce the first fully computer-animated feature film. Toy Story opened on November 22, 1995, and grossed $373 million worldwide. A week later, Pixar went public. Jobs owned nearly 80% of the company. He was a billionaire.
Act Three: The Return (1997–2011)
Apple, meanwhile, had almost died.
By 1996, the company had tried and failed to build a next-generation operating system. It was losing hundreds of millions of dollars a year. The board fired CEO Gil Amelio and went looking for software to buy.
NeXT had the operating system Apple needed. In December 1996, Apple acquired NeXT for $400 million. Jobs came with it, officially as an “advisor.”
Seven months later, Amelio was gone and Jobs was running the company. He called himself “iCEO”—interim CEO—and kept the title until 2000.
Slash and Focus
Apple made dozens of products in 1997: desktops, laptops, printers, PDAs, servers. Jobs drew a simple grid on a whiteboard:
| Consumer | Professional | |
|---|---|---|
| Desktop | ? | ? |
| Laptop | ? | ? |
Apple would make four computers. Everything else was cancelled—including the Newton, Apple’s PDA, which had a cult following.
“Deciding what not to do is as important as deciding what to do,” Jobs said later. “It’s true for companies, and it’s true for products.”
The Turnaround Products
- iMac (1998): A translucent blue all-in-one computer that looked like nothing else on the market. It sold 278,000 units in six weeks.
- iPod (2001): “1,000 songs in your pocket.” Announced October 23, 2001; Apple sold 450 million iPods before discontinuing the line in 2022.
- iTunes Store (2003): Legal music downloads at 99 cents per song. The major labels had spent years fighting piracy; Jobs convinced them to try selling instead.
- iPhone (2007): “An iPod, a phone, and an internet communicator.” Announced January 9, 2007. More than 2 billion have been sold.
- iPad (2010): A tablet computer that critics said nobody needed. Apple sold 3 million in 80 days.
The iPhone Keynote
On January 9, 2007, Jobs took the stage at Macworld in San Francisco wearing his usual jeans and black turtleneck.
“Every once in a while, a revolutionary product comes along that changes everything,” he said. “Today, Apple is going to reinvent the phone.”
He teased the audience by describing three new products: a widescreen iPod with touch controls, a revolutionary mobile phone, and a breakthrough internet communicator. Then he repeated the list. Then again.
“Are you getting it? These are not three separate devices. This is one device. And we are calling it iPhone.”
The phone went on sale June 29, 2007. By November, 1.4 million had been sold. Time named it the invention of the year.
How He Worked
Jobs was not an engineer. He didn’t write code or design circuits. What he did was edit.
“People think focus means saying yes to the thing you’ve got to focus on,” he said. “But that’s not what it means at all. It means saying no to the hundred other good ideas that there are.”
His product reviews were famously brutal. Designers brought their work expecting feedback; they often left with nothing approved. The iPhone went through dozens of prototypes. Jobs rejected features, materials, and entire concepts until what remained met his standard.
That standard extended to things customers would never see. He once delayed a factory shipment because the inside of the machines—where no user would ever look—wasn’t painted properly.
Some Quotes
On product design:
“Design is not just what it looks like and feels like. Design is how it works.”
On ambition:
“We’re here to put a dent in the universe. Otherwise why else even be here?”
On death, from his 2005 Stanford commencement speech:
“Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life.”
And the sign-off from that same speech, borrowed from the Whole Earth Catalog:
“Stay hungry. Stay foolish.”
The Illness
Jobs was diagnosed with pancreatic cancer in 2003. He had a rare form—a neuroendocrine tumor—that was more treatable than the common type, but he delayed surgery for nine months, trying diet and alternative treatments first.
He had the tumor removed in 2004. In 2009, he received a liver transplant. By 2011, the cancer had spread.
On August 24, 2011, Jobs resigned as Apple’s CEO. Tim Cook, who had been running day-to-day operations for years, took over.
Six weeks later, on October 5, 2011, Jobs died at home in Palo Alto. He was 56.
Apple’s market capitalization that day was around $350 billion. When Jobs had returned in 1997, it was under $3 billion.
The Ledger
| Company | Jobs’s Outcome |
|---|---|
| Apple (first stint) | Forced out in 1985 |
| NeXT | Sold to Apple in 1996 for $400M; technology became macOS |
| Pixar | Sold to Disney in 2006 for $7.4B; Jobs became Disney’s largest individual shareholder |
| Apple (second stint) | Built into world’s most valuable company; died as CEO |
Jobs held over 450 patents. He appeared on the cover of Time eight times. Fortune named him the CEO of the decade in 2009.
His estate still holds a significant Disney stake. The technology he bought from Lucasfilm for $10 million in 1986 eventually made his family billions.
What He Left Behind
The Macintosh gave people the graphical interface. The iPod gave them legal digital music. The iPhone gave them the internet in their pocket.
None of it would have happened if the Apple board hadn’t fired him in 1985.
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