Tech’s Bizarre Beginnings & Lucrative Pivots
When you’re building something great, things are bound to get messy.
As many as 80-90% of startups fold and those left standing also fail, repeatedly. Rarely does a business take a straight run at success, and that includes the likes of Apple, Facebook, and their fellow tech giants.
Product lines can come to a screeching halt. Ideas can be stolen. And, yes, even geniuses like Steve Jobs get forced out. But by embracing uncertainty and making timely pivots, the tech companies in the infographic above have become some of the most influential—and valuable—organizations on the planet.
Let’s take a closer look at some of tech’s intriguing beginnings and lucrative pivots.
Samsung’s Evolution from Fish to Phones
Samsung spent much of the 1950s and 1960s testing market waters. The South Korean company tried everything from insurance to textiles, and most oddly, trading dehydrated fish.
Following its experimental phase, Samsung released its first consumer electronic product in 1970—a black-and-white television.
After making a name for itself with TVs, Samsung entered the telecommunications hardware sector in 1980 by way of acquisition. Its product diversification strategy was a successful one. Samsung went on to gain international prominence throughout the 1990s and restructured in 1993 to focus on electronics, chemicals, and engineering.
- Today, Samsung is worth more than $275 billion.
- It has the second-largest market share of smartphone sales in North America, behind Apple.
Facebook Ratings to Friend Requests
Thanks to movies like “The Social Network”, Facebook’s origin story has been hotly discussed.
“Facemash” was developed in Mark Zuckerberg’s Harvard dorm room, as a platform that compared and rated pictures of coeds. When it pivoted from rating coeds to connecting coeds, “TheFacebook” quickly took off across Harvard and spread across the university ecosystem.
- In 2012, Facebook became the first social network to reach 1 billion users.
- It now boasts more than 2.7 billion users across the planet.
- In total, the company has more than 3.14 billion account holders across its platforms, which include acquired companies like WhatsApp, Instagram, and Messenger.
“If you always do what you’ve always done, you’ll always get what you’ve always got.”
— Henry Ford
About Them Apples: Mac Starts with Schools
From the jump, Apple was strategic.
To open up the market for personal computers, Steve Jobs (Apple’s now legendary co-founder), personally lobbied multiple levels of government to increase tax incentives for companies that donate to schools—a remarkable undertaking for a scrappy startup.
After his federal lobbying fell through, Jobs was successful in the state of California. By initially focusing on education—and giving their computers away for free to the California school system—Apple amassed a potential user base and claimed mindshare.
“… for about $1 million, Apple put an apple in every elementary, middle, and high school in California.”
— Hacker Education
Today, an Apple computer is the go-to tool of the creative class. In 2018 alone, the company sold 18.21 million Mac computers. By early 2020, there were 1.5 billion active iPhone devices, and by the end of August 2020, Apple was worth more than $2 trillion.
Apple proves that even with a solid strategy and excellent products, the corporate machine can still veer out of control. Jobs was famously forced out of the company in 1985.
In his absence, ventures backfired. After his return in 1997—and the subsequent introduction of the iPod—Apple went on to become one of the most lucrative tech companies in the world.
Sony Sticks to Electronics
Sony’s brand name has long been synonymous with quality—but its first electronic product didn’t make it to market.
After WWII, Sony wanted to make a rice cooker to serve post-war Japan, so the company developed a simple wooden rice cooker with electrodes attached. Due to inconsistent electrical power throughout the country, the project was shelved.
Sony, however, stuck to electronics. After establishing its brand name with TVs, Sony branched out into gaming and is now the largest video game console manufacturer and game publisher.
- As of 2020, its global revenue neared $77 billion.
- The company brings in 26.7% of sales from game and network services.
- Meanwhile, nearly $4.5 billion in revenue stems from its mobile communications segment.
YouTube’s Dating Game
Gen Z has become the first generation to watch more YouTube than TV. But when YouTube was founded in 2005, it was a bit more akin to Tinder.
Back when video dating was still a thing, YouTube aimed to take the experience online. The company even went so far as to offer women money to upload videos. However, the idea didn’t click. YouTube’s co-founders decided to release a platform that would allow for any video type—and from there, sparks flew.
- YouTube was acquired by Google in 2006 for $1.7 billion.
- By 2019, it had more than 1.68 billion users worldwide.
“If you’re competition-focused, you have to wait until there is a competitor doing something. Being customer-focused allows you to be more pioneering.”
— Jeff Bezos
Twitter Ditches Talk for Type
For the platform known for a deluge of words and character-count limits, it may be a surprise that Twitter was meant to be a podcasting platform called “Odeo”.
When Apple announced its entry into the podcasting world, the team realized they couldn’t compete. Instead, Odeo turned to its engineering manager Jack Dorsey to pivot the company into his side project, now known as Twitter. Although original Odeo investors weren’t happy with the move, the strategy proved successful.
- In 2019, Twitter raked in $3.46 billion in revenue.
- It averages 150 million daily users.
- Twitter collected advertising revenue of nearly $3 billion in 2019.
- It was valued at nearly $35 billion in 2020.
Rubber Boots to Phones: Nokia’s Puzzling Pivot
Back in the 1970s and 1980s, Nokia made a very different kind of product—rubber boots. The Kontio product line was successful, but in the early 1990s, the company pivoted to focus on mobile connectivity and hardware.
Released in 2003 and 2005, the Nokia 1100 and 1110 still hold the record for the world’s most popular phones, with more than 250 million units sold of each.
Although Android and iPhone have sped past Nokia as smartphone manufacturers, Nokia is still worth about $24 billion. While its phones were incredibly popular, the pivot took a financial toll, and the company’s mobile and services division was acquired by Microsoft in 2013.
Shopify Rides into Sales
Frustrated with the online sales experience, the founders of Snowdevil—a Canadian secondhand snowboard shop—decided to create their own online experience. Instead of their gear taking off, it was their platform that caught wind with consumers, and the team knew they were on to something.
In the span of two years, 2004-2006, Snowdevil became Shopify. Less than a decade later, it went public in 2015.
- Today, Shopify claims 20% of global market share among ecommerce platforms.
- It has more than 800,000 online sellers using the platform.
Nintendo Games Span Centuries
When it comes to gaming, Nintendo has more than 150 years of experience to draw from.
Beginning with hand-painted cards in the 1800s, Nintendo sold cards for multiple games, including gambling. Their nature-inspired and cartoon-like style was carried into the 20th century when Nintendo partnered with Disney to create playing cards.
Like other tech companies, Nintendo has ventured into some unusual markets over the years, including ramen noodles.
However, its primary focus has remained on games. In 1985, Nintendo released what would become the world’s most popular video game, Super Mario Bros—which has sold more than 40 million copies worldwide.
The Winding Road to Success
Silicon Valley’s “fail fast” philosophy—pressure testing and pivoting—can be a lucrative, albeit grueling, one.
It’s an adaptive strategy that isn’t relegated to tech companies alone. Pivots large and small are often a key part of any company’s evolution, from products and services to marketing strategies.
Beyond bizarre beginnings and pivots, if there’s one thing successful companies have in common, it’s the audacity to evolve.
Ranked: The Most Innovative Companies in 2021
In today’s fast-paced market, companies have to be innovative constantly. Here’s a look at the top 50 most innovative companies in 2021.
Ranked: the Top 50 Most Innovative Companies in 2021
This year has been rife with pandemic-induced changes that have shifted corporate priorities—and yet, innovation has remained a top concern among corporations worldwide.
Using data from the annual ranking done by Boston Consulting Group (BCG) using a poll of 1,600 global innovation professionals, this graphic ranks the top 50 most innovative companies in 2021.
We’ll dig into a few of the leading companies, along with their innovative practices, below.
Most Innovative Companies: A Breakdown of the Leaderboard
To create the top 50 innovative company ranking, BCG uses four variables:
- Global “Mindshare”: The number of votes from all innovation executives.
- Industry Peer Review: The number of votes from executives in a company’s industry.
- Industry Disruption: A diversity index to measure votes across industries.
- Value Creation: Total share return.
For the second year in a row, Apple claims the top spot on this list. Here’s a look at the full ranking for 2021:
|Company||Industry||HQ||Change from 2020|
|3||Amazon||Consumer Goods||🇺🇸 U.S.||--|
|5||Tesla||Transport & Energy||🇺🇸 U.S.||+6|
|6||Samsung||Technology||🇰🇷 South Korea||-1|
|9||Sony||Consumer Goods||🇯🇵 Japan||--|
|12||LG Electronics||Consumer Goods||🇰🇷 South Korea||+6|
|14||Alibaba||Consumer Goods||🇨🇳 China||-7|
|17||Cisco Systems||Technology||🇺🇸 U.S.||-5|
|18||Target||Consumer Goods||🇺🇸 U.S.||+4|
|19||HP Inc.||Technology||🇺🇸 U.S.||-4|
|20||Johnson & Johnson||Healthcare||🇺🇸 U.S.||+6|
|21||Toyota||Transport & Energy||🇯🇵 Japan||+20|
|23||Walmart||Consumer Goods||🇺🇸 U.S.||-10|
|24||Nike||Consumer Goods||🇺🇸 U.S.||-8|
|25||Lenovo||Technology||🇭🇰 Hong Kong SAR||Return|
|26||Tencent||Consumer Goods||🇨🇳 China||-12|
|27||Procter & Gamble||Consumer Goods||🇺🇸 U.S.||+12|
|28||Coca-Cola||Consumer Goods||🇺🇸 U.S.||+20|
|29||Abbott Labs||Healthcare||🇺🇸 U.S.||New|
|30||Bosch||Transport & Energy||🇩🇪 Germany||+3|
|32||Ikea||Consumer Goods||🇳🇱 Netherlands||Return|
|33||Fast Retailing||Consumer Goods||🇯🇵 Japan||Return|
|34||Adidas||Consumer Goods||🇩🇪 Germany||Return|
|35||Merck & Co.||Healthcare||🇺🇸 U.S.||Return|
|37||Ebay||Consumer Goods||🇺🇸 U.S.||Return|
|38||PepsiCo||Consumer Goods||🇺🇸 U.S.||Return|
|39||Hyundai||Transport & Energy||🇰🇷 South Korea||Return|
|41||Inditex||Consumer Goods||🇪🇸 Spain||Return|
|44||Disney||Media & Telecomms||🇺🇸 U.S.||Return|
|45||Mitsubishi||Transport & Energy||🇯🇵 Japan||New|
|46||Comcast||Media & Telecomms||🇺🇸 U.S.||New|
|47||GE||Transport & Energy||🇺🇸 U.S.||Return|
One company worth touching on is Pfizer, a returnee from previous years that ranked 10th in this year’s ranking. It’s no surprise that Pfizer made the list, considering its instrumental role in the fight against COVID-19. In partnership with BioNTech, Pfizer produced a COVID-19 vaccine in less than a year. This is impressive considering that, historically, vaccine development could take up to a decade to complete.
Pfizer is just one of four COVID-19 vaccine producers to appear on the list this year—Moderna, Johnson & Johnson, and AstraZeneca also made the cut.
Meanwhile, in a completely different industry, Toyota snagged the 21st spot on this year’s list, up 20 places compared to the rankings in the previous year. This massive jump can be signified by the company’s recent $400 million investment into a company set to build flying electric cars.
While we often think of R&D and innovation as being synonymous, the former is just one innovation technique that’s helped companies earn a spot on the list. Other companies have innovated in different ways, like streamlining processes to increase efficiency.
For instance, in 2021, Coca-Cola performed an analysis of their beverage portfolio and ended up cutting their brand list in half, from 400 to 200 global brands. This ability to pare down and pivot could be a reason behind its 20 rank increase from 2020.
Innovation Creates Value
As this year’s ranking indicates, innovation comes in many forms. But, while there’s no one-size-fits-all approach, there is one fairly consistent innovation trend—the link between innovation and value.
In fact, according to historical data from BCG, the correlation between value and innovation has grown even stronger over the last two decades.
For example, in 2020, a portfolio that was theoretically invested in BCG’s most innovative companies would have performed 17% better than the MSCI World Index—which wasn’t the case back in 2005.
And yet, despite innovation’s value, many companies can’t reap the benefits that innovation offers because they aren’t ready to scale their innovative practices.
The Innovation Readiness Gap
BCG uses several metrics to gauge a company’s “innovation readiness,” such as the strength of its talent and culture, its organization ecosystems, and its ability to track performance.
According to BCG’s analysis, only 20% of companies surveyed were ready to scale on innovation.
What’s holding companies back from reaching their innovation potential? The most significant gap seems to be in what BCG calls innovation practices—things like project management or the ability to execute an idea that’s both efficient and consistent with an overarching strategy.
To overcome this obstacle, BCG says companies need to foster a “one-team mentality” to increase interdepartmental collaboration and align team incentives, so everyone is working towards the same goal.
Timeline: Looking Back at 10 Years of Snapchat
A high level look at Snapchat’s 10-year history, including user growth, innovative product design, and the twists and turns along the way.
Looking Back at 10 Years of Snapchat
Over the years, many ideas have emerged from the dorm rooms at Stanford University, but not all of them evolve into billion dollar companies.
Snapchat, however, has beaten the odds. The company’s stock has recently shot up during the COVID-19 pandemic, a bright spot in a decade of highs and lows.
The graphic above is a high level look at Snapchat’s 10-year history, including user growth and financials. Snapchat’s wild ride from start-up to massive success is well documented, so we’ll focus on key elements of story—product design, the Facebook rivalry—and look at how the company is doing today now that the hype surrounding the app has died down.
But first, a quick history…
Setting the Scene
Snapchat originally began its life as a project called Picaboo in 2011.
Cofounders Evan Spiegel, Bobby Murphy, and Reggie Brown, who were attending Stanford, began building an app that could send photos that disappear after a certain amount of time.
Picaboo was renamed Snapchat in 2012, and by the end of that year, it was clear that the start-up was onto something big. A $13.5 million Series A financing in early 2013 helped fuel the company’s explosive growth.
Positive Momentum: Product Design
One of Snapchat’s biggest strengths over the years has been innovative product design. Many of the features we now see baked into every social app originated from Snapchat.
Here’s a quick rundown of Snapchat’s key feature and product development over the past decade.
Of all the features listed above, the concept of stories is perhaps the most significant contribution to the digital landscape. Disappearing short-form videos started off as a messaging tool, but ended up transforming the way people share their lives online.
As well, the forward-looking acquisition of Looksery in 2015, helped introduce millions of people to augmented reality (AR). AR continues to be a major growth driver for Snapchat today, as advertisers embrace the Lenses feature.
Negative Momentum: Facebook Rivalry
To Mark Zuckerberg’s credit, he realized the potential of Snapchat early.
When the company was only one year old, the Facebook CEO offered the Snapchat founders $60 million to buy the company. When they rejected the offer, Facebook almost immediately launched an app called Poke which was extremely similar to Snapchat’s offering. You’d be forgiven for not knowing what Poke is, as the app received a tepid reception and was quietly shut down in 2014.
“I hope you enjoy Poke.” – Mark Zuckerberg, in an email to Evan Spiegel
For Snapchat, Poke was a blessing in disguise as it brought even more attention to their growing app. Mark Zuckerberg, however, was not done trying to steal the company’s thunder. After offering $3 billion in cash to purchase Snapchat (the offer was once again rebuffed), Facebook copied a number of features from Snapchat and integrated them into Instagram.
Stories were a massive hit for Instagram, and Snapchat, which could not yet match Instagram’s scale, took a big hit. Growth began to slow noticeably after that Instagram update.
Snapchat hit rock bottom in 2018 after shares dropped below the $5 mark, and user growth had stalled out. As well, underwhelming sales of Snapchat’s Spectacles product garnered negative press and hurt the brand’s “cool factor”.
Today though, the situation looks much different. The app still has a strong market share with the younger demographic, and close to 300 million daily active users. Snapchat was one of the many digital companies to benefit from the COVID-19 pandemic (or, at least, the increase in digital content consumption), and the share price has rocketed to new highs. One other promising indicator is the company’s rising average revenue per user, or ARPU.
Of course, as the last 10 years have shown, success is not guaranteed. TikTok is still a significant competitor with a lot of momentum, and tastes can change quickly in the digital world. That said, there is a positive path forward for Snap Inc.
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