Continuing the series of articles which look at the history of the major tech companies, this week I’m looking into how Apple came to be the first trillion-dollar company ever.

As with most tech company stories, Apple’s begins in a non-descript garage in the US.   The two friends, Steve Wozniak (Woz) and Steve Jobs met in 1971 after being introduced by Bill Fernandez who also became one of Apple’s early employees.

Jobs and Wozniak had shared interests in technology and pranks.   They started off by building a gadget known as a “Blue Box”, a device that fooled the telephone network into allowing free calls.   Using the device, they almost managed to speak to the Pope at the Vatican.

“Yeah, we did call the Pope. He [Woz] pretended to be Henry Kissinger.

We got the number of the Vatican and we called the Pope, and they started waking people up in the hierarchy,  you know…I don’t know, Cardinals and this and that, and they actually sent someone to wake up the Pope when finally we just burst out laughing and they realized we weren’t Henry Kissinger.”

(Ironically, in 2016 the CEO of Apple, Tim Cook actually met with the Pope to discuss technology!)

Woz had the technical brains of the pair, whereas Jobs looked after the business and design/marketing aspects.

The MITS Altair hobbyist computer had just been released and Woz was inspired.   He produced the first traditional computer with a keyboard that could connect to a TV screen and it became known as the Apple I.    Woz wasn’t (and still isn’t) in it for the money – “When I built this Apple I… the first computer to say a computer should look like a typewriter – it should have a keyboard – and the output device is a TV set, it wasn’t really to show the world [that] here is the direction [it] should go [in]. It was to really show the people around me, to boast, to be clever, to get acknowledgement for having designed a very inexpensive computer.”

Jobs on the other hand could see the potential for this breakthrough device and sold his VW microbus to fund its development.   Woz sold his calculator and together they founded Apple Computer Inc on April 1st1976 with the help of friend Ronald Wayne.   However, Wayne got cold feet and 12 days later sold his share of the company for $500.   Forty years later that
$500 holding would’ve been worth $72 billion dollars!

Jobs and Woz took a gamble with the Apple I, agreeing to supply 50 to Byte Shop in Mountain View.   Byte Shop were themselves taking a gamble as the Apple I only existed as a prototype and Jobs and Woz didn’t have the capital necessary to build the machines.   They’d been turned down for a bank loan but had convinced Byte Shop to fund the order on a thirty-day credit.   It was now or never – the two enlisted help from friends and family to build the computers at the kitchen table.

Together, they made 200 units which due to their scarcity are now worth nearly $1 million today!   Their popularity drove the development of a successor – the Apple II which was debuted at the West Coast Computer Fair in April 1977.   This was an expensive machine though – it cost $1300.  To make it sell they needed a “killer app” which turned out to be VisiCalc – one of the first spreadsheets.   This combined with the new colour graphic capability of the Apple II made it a huge success.

By the 1980s the Apple III had been released but was still based on the same text-based interface of the I and II.   Apple needed to innovate, and Jobs had heard that Xerox PARC were developing new graphical interfaces.   He stuck a deal with Xerox – they would give Apple employees three days of access to their engineers and demos.  In return Xerox were given the right to buy up to 100,000 Apple shares at $10 each (altogether worth $708 million today!).

What Jobs saw at Xerox changed the way that computers would be used forever.

I’ll cover that along with the rest of Apple’s history in the next article!