The $300 Billion Mistake

We all know the epic story of Steve jobs and how he started Apple from his garage and how he made it into a multi-billion dollar business as it is today.

However, very few people actually know that Steve Jobs was not the only founder of Apple. In fact, there were 3 founding partners of Apple, Steve Jobs, of course, was a visionary and a marketing genius.Then there was Steve Wozniak, who was the brains behind the epic technology and the third was a very little known person, Ronald Wayne.

In 1976, when Ronald was in his early forties, he met Steve jobs and Steve Wozniak for the first time. As soon as he got to know them, he was very inspired by their talent and their ambitions.

Hence he realised that these guys had a lot of ideas, but they did not exactly know how to get started.

So, one day he invited both of them to his house to discuss the action plan and all 3 of them had a good two-hour long discussion and after which, Steve jobs felt that the best way to get started was to form a company and he named it Apple.

Now that was all good. But what do you do next? So these young kids had no idea how to incorporate a company. Well, this is when Ron’s background helped. Ron had experienced incorporating a company before and he also started his own company when he was in his twenties. So clearly Ron was the man for the job.

 The two young men entrusted Ron to draft the partnership agreement for the firm. They saw a lot of value that Ron brought to the table in terms of his experience and his knowledge.

Hence, they decided that Ron would become a partner in the company. Hence, both  Steve jobs and Steve Wozniak got 45% of stake in the company. Ron got 10% and he then personally drafted the historic partnership agreement of the company.

However, Ron’s role in the company was not just administrative. He was also a father figure at this stage because both Steve Jobs and Steve Wozniak were very immature then. They were also prone to getting into frequent arguments and it was Ron’s job to calm them down and resolve any issues before they became bigger.

That is exactly why Steve Jobs always looked up to Ron as a mentor. Apart from this, Ron was also responsible for creating the Apple logo and its first ever user manual.

Now things started to pick up pace when Steve jobs secured their first ever order for a company named “The Byte Shop”. Once they got this order and they were very excited, they did not have any money to get started.

So Steve Jobs secured a $15,000 loan for buying the raw materials for their order. However, this loan started to make Ron very nervous because he had some bad experience from the company that he had started.

It had taken him several years to come out of the debts that he had. He also thought that he might be getting into a similar kind of trouble because he knew that legally, all members of a Partnership were personally responsible for any debts incurred by any partner.

Both Steve Jobs and Steve Wozniak were very young. Jobs was about 21 years old and Wozniak was about 25. They had no money and basically had nothing to lose, but Ron had personal assets, that  potential creditors or banks could possibly seize in case the company went bankrupt.

On top of that, the customer who had actually placed the order, “The Byte Shop”, was known to make very slow payments to its vendors.

Due to these fears, Ron got cold feet and decided to exit the partnership. Now, Steve Jobs personally did not want John to exit and requested him several times to remain with them, but Ron did not listen to him at all. He gave his partnership back for a mere $800. Just imagine, $800 for 10% shares in Apple.

As of today, the same 10% shares of Apple would be worth more than $300 billion. Even when we think about the lost opportunity makes one cringe about the bad decision that Ron made.

However, more interestingly, even after Ron had exited, Steve Jobs contacted him several times and tried to persuade him to come back and join Apple again.

Ron, however, decided that he didn’t want to join. As they say that it takes a special talent to lose billions of dollars and Ron certainly had that talent. As of today, Ron lives in a mobile home in Nevada from where he sells stamps and coin collections.

One can only imagine how his life would have turned if he had shown some faith in these two talented geniuses.

The $300 Billion Mistake

We all know the epic story of Steve jobs and how he started Apple from his garage and how he made it into a multi-billion dollar business as it is today.

However, very few people actually know that Steve Jobs was not the only founder of Apple. In fact, there were 3 founding partners of Apple, Steve Jobs, of course, was a visionary and a marketing genius.Then there was Steve Wozniak, who was the brains behind the epic technology and the third was a very little known person, Ronald Wayne.

In 1976, when Ronald was in his early forties, he met Steve jobs and Steve Wozniak for the first time. As soon as he got to know them, he was very inspired by their talent and their ambitions.

Hence he realised that these guys had a lot of ideas, but they did not exactly know how to get started.

So, one day he invited both of them to his house to discuss the action plan and all 3 of them had a good two-hour long discussion and after which, Steve jobs felt that the best way to get started was to form a company and he named it Apple.

Now that was all good. But what do you do next? So these young kids had no idea how to incorporate a company. Well, this is when Ron’s background helped. Ron had experienced incorporating a company before and he also started his own company when he was in his twenties. So clearly Ron was the man for the job.

 The two young men entrusted Ron to draft the partnership agreement for the firm. They saw a lot of value that Ron brought to the table in terms of his experience and his knowledge.

Hence, they decided that Ron would become a partner in the company. Hence, both  Steve jobs and Steve Wozniak got 45% of stake in the company. Ron got 10% and he then personally drafted the historic partnership agreement of the company.

However, Ron’s role in the company was not just administrative. He was also a father figure at this stage because both Steve Jobs and Steve Wozniak were very immature then. They were also prone to getting into frequent arguments and it was Ron’s job to calm them down and resolve any issues before they became bigger.

That is exactly why Steve Jobs always looked up to Ron as a mentor. Apart from this, Ron was also responsible for creating the Apple logo and its first ever user manual.

Now things started to pick up pace when Steve jobs secured their first ever order for a company named “The Byte Shop”. Once they got this order and they were very excited, they did not have any money to get started.

So Steve Jobs secured a $15,000 loan for buying the raw materials for their order. However, this loan started to make Ron very nervous because he had some bad experience from the company that he had started.

It had taken him several years to come out of the debts that he had. He also thought that he might be getting into a similar kind of trouble because he knew that legally, all members of a Partnership were personally responsible for any debts incurred by any partner.

Both Steve Jobs and Steve Wozniak were very young. Jobs was about 21 years old and Wozniak was about 25. They had no money and basically had nothing to lose, but Ron had personal assets, that  potential creditors or banks could possibly seize in case the company went bankrupt.

On top of that, the customer who had actually placed the order, “The Byte Shop”, was known to make very slow payments to its vendors.

Due to these fears, Ron got cold feet and decided to exit the partnership. Now, Steve Jobs personally did not want John to exit and requested him several times to remain with them, but Ron did not listen to him at all. He gave his partnership back for a mere $800. Just imagine, $800 for 10% shares in Apple.

As of today, the same 10% shares of Apple would be worth more than $300 billion. Even when we think about the lost opportunity makes one cringe about the bad decision that Ron made.

However, more interestingly, even after Ron had exited, Steve Jobs contacted him several times and tried to persuade him to come back and join Apple again.

Ron, however, decided that he didn’t want to join. As they say that it takes a special talent to lose billions of dollars and Ron certainly had that talent. As of today, Ron lives in a mobile home in Nevada from where he sells stamps and coin collections.

One can only imagine how his life would have turned if he had shown some faith in these two talented geniuses.