The Power of Desirable Difficulties

This message comes from Avalera. What's it like running a business with Avalara? No thinking about tax and compliance, It's handled. calculating, filing, validating, accurately and audit defensibly Avalera, Aentic tax and compomplliance with Confidence. This is Planet Money from NPR. Okay, how many times have you sat and thought about how much more you could accomplish if you had more, more time, more money, more resources. Like how good your project could be if you had just one more day. or bigger budget or more help This is the story of a company that did have all of that. and they were making something amazing, something most of us touch every day smartphone And this is a part that is bonkers. This was happening nearly two decades before the iPhone. came out Before the internet Be WiFi, before mobile data, before cell phones even. Tony Fidel was employee number twenty nine at that company. Be even email really existed for people before Anything like Amazon or eetailing existed before downloadable games or downloadable music exists. All of that stuff. We were creating all the technology that would later become what the iPhone was. Nowadays, Tony is a businessman Al been a computer geek. His words, not ours I was making fake ID's on a mac in high school because if you had a laser printer and a laser printer was like, oh my God, I could replicate things in the world. So I was making fake ideDass on a laser printer. It must have been very popular. Oh yeah, yeah, I made a lot of money too Tony was brought up in the seventies and eighties to build things I was fixing things. I was changing electrical sockets. You're describing yourself as kind of being like a shop class kind of kid. Yeah. My grandfather taught shot class Oh, seriously a shop class kid. Okay. He always had the mantra If a human made it, a human can fix it and build other things too Tony's favorite thing to tinker with was computers. It was your own world. You could make anything you wanted. And around the time Tony was in high school, mid eighties, computer geeks actually started to become cool. And Rolling Stone, there was a huge article by Stephen Levy about the original Mat team And I was like, oh my God, there's computer Guys like me, guys and gals like me building this thing that I love the Macintosh. and they're in a rock and roll magazine. I'm like superstars He's fifteen and he became obsessed with these computer engineers. Oh, I could be like that. so they were my heroes And so I would just track them obsessively. yees, Dalking you could say Tony went to college, launched a few startups, and he kept reading tech magazines. And then one day, he saw something buried in the gossipy type pages in the back of one of those magazines. Tony learned his heroes were working on this top secret project It was at a brand new company called general magic. And I was like General magic, what What is this? And he didn't care how he just wanted in. I had no idea what they were doing, but whatever it is, I needed to get involved You found a number, started calling sometimes ten, fifteen times a day. This is your favorite band. You're like, I want to get on the road with the band. Yeah, I to be a roadie. whatever it takes. I just want to be with this band. So after you know six to seven month knocking on the door, getting rejected and pestering the hell out of everyone there. they gave me a job and I went crazy. Tony moved to Silicon Valley to work with his heroes. He was twenty one, his dream had come true. He was hired as a software engineer in the hardware team at General Magic to make the first smartphone, this thing that was going to change the world in nineteen ninety one Hello and welome to Planet Money. I'm Erica Barris, and I'm Ema Peasley. General Magic had everything, the vision, the talent, the money, but having everything might have been its undoing today on the show, but the push to create the first smartphone can teach us about how genius ideas come to life. Bordom This message comes from Cook Unity, the first chef led meal delivery service where every meal is handcrafted in local microkitchens, not mass produced in large facilities, with hundreds of dishes to choose from, and over ten different dietary preferences like high protein, low sodium, GOP one, and more, taste what happens when real award winning chefs make f fresh small batched meals just for you. Go to cookunity. com slash money or enter code money before checkout to get fifty percent off your first order. This message comes from Granger. For the ones who get it done, Granger offers the professional grade products you need to get the job done With fast delivery and access to technical product experts ready to help you meet any challenge. Call, click granger. com or just stop by General Magic was creating basically an iPhone But in the early nineties That time. I was carrying quarters around to use payphones. Computers were in like fifteen percent of American homes and yet Here was generenal magic, creating this Mit Portable Interconnectivity device From your palm, you'd call people, send them faxes, you'd be able to buy things on it, book travel, navigate yourself around, play games. And none of this existed Tony was part of a team that was building all of it. We were creating the entire operating system. We were creating all the chips We were creating the devices. We were creating all the network servers and network server software All the user interface, all the applications. We were creating That is a lot. We were creating the touchs screen. We were creating everything in this little company. All of it at this company Research, development, and engineering were all happening at once And they had the talent to do it. General Magic was started by those rock stars, and they handpicked other budding rock stars to work there too. It was so exciting. General Magic even hired an in house film crew ile, you candid camera. That ended up making a documentary about the company. So we've seen footage of younger long haired Tony hunched over a small screen with a bunch of wires connected to a keyboard up a demo so that we can see keyboards working with the device He's building an early version of the USB Gordon If you want to hook up disk drives and things of that nature, yeah, it's really important. Another employee, Meghgan Smith, was working on a touch screen You can figure out where you are whether you're touching tea or whether you're touching capsu. How small will it finally be think? Someday, Dict tracy Rishaurge. And the money was there to fuel all these experiments. The company's investors included all these telecom and electronics giants, like Apple and AT and T and Motorola and Sony Panasonic to name a few. They literally threw many, many millions of dollars at this Silicon Valley startup because they all wanted a piece of what could potentially be the next big thing People from those companies would sometimes come visit. They were just like Mesbarra, was like, what is this you're building? They had no reference point because it was so different than anything they had seen So they're like Whoever these people are, they're really geniuses. That's really cool. I don't understand it, but'll just keep them going because it's clear. they think they know what they're doing The employees called themselves magicians, and there was even a bunny in the office. An actual bunny named Bowser, because of course, magicians need a rabbit The magicians worked endlessly. Just people programming, whatever at all times of the day and night doing things. it', come over here and check this out People would be sleeping there overnight. We were there so often the place smelled You know, people would hang up their dirty clothes on the cubicle walls It was like a huge dorm room smmelled like work And their job was just to come up with ideas and try everything bosses encourage that I'm like, hey, I'm thinking about this. Yeahah, that's a good idea. goo work on that. I'm like, okay. And then I'd show them. they' like, well, maybe a little bit more of this, maybe more of that, and then go off and do it funders, those giant companies, they also had ideas. Tony would travel as far as Japan to meet with Mitsubishi or Sony, and those companies wanted the general magic device to work with their systems. So Tony would come back to the office and they'd all keep tinkering. So much cash that in nineteen ninety four, they traveled around the country by private jets. to show off their product They got lots of press attention. Some say it's revolutionary. Others simply say it's magic It was quite possibly the wildest, the mniest, the most creative company of its time And Tony right at the center of it It was the biggest sandbox playing with the smartest, coolest geeks, you see our foundnder skipping through the hall and singing. So this sounds like ideal. like this sounds like the dream Yeah. Yeah, okay. So you're living the dream. the dream Tony was having the time of his life A few years in He started to think there might be problems. They had not made anything yet. Nothing actually existed, and there was no real schedule. No Re deadlines. When I joined, they were like, we're going to ship this product in the next year to year and a half. Okay. sounds great to me Well, twelve months goes by And I'm like, okay, we're shipping a product. I'm just trusting every.one' like, I guess this is how you ship a product. I don't know. These guys should I'm twenty two. Yeah, these guys know they've done it before. so I'm just gonna to follow the lead. Then eighteen months go by and I'm like Wait a second. We're not even close to shipping anything that. And then it was twenty four months and I'm like What? Then it was it was, you know, thirty two months Twelve months turned into four years and they still hadn't actually finished the product they had set out to build And at that point, there started to be pressure Sony and Pamonic and Mora and all those companies were like Hello. Where is the product that we invested in? They had to get a product to market So in fall of nineteen ninety four They finally did. And in true tech fashion, the company's leaders, the tech rock stars, held a big splashy show for its debut So welcome to the first public demonstration of General Magic's technologies. I want to talk a little bit about the device existed. Sony Magic link powered by generenal Magic. It was like a mini tablet but chunkier. You could choose apps from a touchs screen while holding it in your hands and Almost fitted in your pocket. General Magic, played a promotional video and all. It's a new way to reach just about anyone. Anywhere, anyime. You're only a pressive button away. Sony Magic Link. And what it takes off your desk is only matched by what it takes off your mind The future was here. The magicians, they had delivered. You could send a fax, track your checks, read a book, play a game like Solitaire, all for the price of eight hundred dollars in nineteen nineties dollars And there was just one minor issue This magic link ended up being the biggest flop in Silicon Valley for a decade or more. Yeah, they ran into a very eCon one hundred one problem when customers press and everybody looked at it and they go, what is this? It is not enough to have supply. Gott to have demand Less than three thousand magic links were sold Mly to family and friends of the magicians Within a few years, this company that was going to change the world became a distant Silicon Valley memory How did that happen? How did this visionary idea become a nothing product Well, that whole story you just heard. That whole story. was the reason it became a nothing product. At least that's the theory of one guy who spent years researching what happens when people have too much freedom They were a spectacular failure because they had T much They had too much talent, they had too much time, they had too many resources. They could do anything And so they did do anything. David Epstein is a journalist and he says, years later, when he got his hands on the thing General Magic built, this iPhone before the iPhone was actually pretty fun. I mean, I played with a Sony Magic link and it's definitely cool Um, but part of the problem was There was so much that it was incoherent. I mean, it's shipped with a two hundred page manual. Can you imagine getting a device like the phone book, essentially? We first learned about general magic from a book David wrote called Inside the Bx, How Cstraints Make us Better David studied what made Dr. Sus and doror Martin Luther King Jr., and Isabella Yende and NASA and Pixar successful And his big theory that cuts across all of them is that to be creative, to be successfully creative, you need limits. David says what happened at General Magic is a great example of why people need constraints And you can basically distill those takeaways into three lessons. Number one didn't have a clear customer in mind. They didn't have a problem they were fixing or a need they were filling Basically nothing to guide what they were making did have an imaginary customer in their heads named Joe Sixpacks Basically a guy lazing on his couch with a beer watching TV. what they didn't think about was what problem they were solving for him He didn't need email in his pocket because odds are, Joe Six Pack didn't even own a computer Is Joe Sixpack going to read a two hundred page manual? I mean, I've read a lot of the manual It's elaborate didid test the magic link on a few real people like Tony's mom My mom was a user a tester So my mom came to visit me. My mom said in user testing. She's like 't get it. What is this thing for? It didn't work. Was it me? Did I do something wrong? I don't understand why I even need this thing. was like Wait a second. Moms always know. And I was like, Yeah Who is going to purchase this? What problems are we going to solve for them with this Why are they going to want to put their money down Tony and David agree. Sure the technology may have been ahead of its time But David says a big part of what tripped them up was not having a clear picture of their customer. It was a problem because it didn't tell them what to do, and more importantly, what not to do So if they had a very specific customer in mind And they identified some real customer problems, they would have had priorities And the fact that they weren't listening to what customers needed was compounded by who they were listening to the second problem David identified Too much money General Magic's idea was so revolutionary that it attracted the attention and money of a lot of powerful partners. You know, those companies Tony was flying to visit like Sony, Mitsubishi, Motorola, Phillips, AT and T. They covered so much of the communications technology world that whenever they had meetings The meetings had to begin with an antitrust lawyer listing all of the topics that they were not allowed to discuss. so they wouldn't run afoul antitrust regulations. But what they were talking about was this product that they were locked into because they had so much investment from all these companies General magic probably would have done better to stay really, really, really small. It might seem inefficient to stay small for years, but that's when you're laying the groundwork and setting the boundaries. notot letting the cost explode They hired way more people after Tony There's this principle called Brooks's Law. It's named after Fred Brooks, who was a computer scientist. He led the development of the operating systems that NASA used in the space program. Brooks's law essentially says that when you add people to a project that's already late It's going to be even more late. They spent a lot on people. They spent on offices They had a gigantic bush in the shape of a bunny even when they were already having problems. Like The essentials. Yeah, the essentials And they spent a lot on materials General Magic was pretty much building everything from scratch. Like at one point, Tony reinvented the technology that connected the remote to a TV, even though that had been around for many years. They were never forced to look around the technological environment and say, what's realistic and what can we borrow and build on? I mean what was the problem The problem was because they had time, they had money, They really ended up kind of building for each other Almost the engineers sort of trying to impress one another. Which brings us to the third and final big lesson, General Magic's failure teaches us s Hard to make magic when you have no bosses and no deadlines everyveryone who had a good idea did it Like they very rarely told someone no, they couldn't do something David says what they had We're leaders. What was the difference between a leader and a manager to them The leaders were legendary programmers. so I think it was we're going to listen to these people Our legends are our icons Those people were not equipped to be giving them deadlines and help clarifying what they should be doing and priorities and all those things either. They were off doing things that they thought were cool but priorities also Games, emojis, sound effects. Can I give an example of what I think it was an emblematic u case inside of general magic. The engineer Steve Parlman who was charged with creating a calendar function. And Steve wrote the calendar function to go from nineteen oh four to twenty ninety six. and he checks it in and thinks he's done And then one of the leaders of the company comes to him and says, Steve. somebody might write historical apps, you have to write this calendar to go back farther So he opens it up and writes it to go from year one to the future. Okay, checks it and thinks he's done. Then another team comes to him and says, Steve Why are you tying it into this arbitrary religious context? You should make it go back to the beginning of astronomical time. Right, So that's how Steve Perlman ends up opening up the calendar function and writing it to go from the B bang. to the future. and On a device that maybe doesn't yet exist. And as he said, if he had stuck with nineteen oh four to twenty ninety six, it would have been four lines of code and he could have moved on. Be they could do anything They did and everything always got bigger Meanwhile, the Magic Link, what was supposed to be the first smartphone, never delivered on its most basic promise This thing that was going to be a phone and a computer and more didnn't end up having a phone And we can look at the magicians and go, wow, what a disaster, What a rack Too bad. and move on Or we can look at general magic the way Tony Fidel did prrint for what After he left the company, Tony applied what he learned to future projects, like big projects, including the real iPhone And in the most iconic features of those products he helped create, you can actually see and touch the lessons Tony learned That's after the break This message comes from Cook Unity, the first chef led meal delivery service where every meal is handcrafted in local micro kitchens, not mass produced in large facilities, with hundreds of dishes to choose from, and over ten different dietary preferences, like high protein, low sodium, GLP one, and more. taste what happens when real award winning chefs make f fresh small batched meals just for you. Go to cookunity. com slash money or enter code money before checkout to get fifty percent off your first order. This message comes from Granger. For the ones who get it done, Granger offers the professional grade products you need to get the job done With fast delivery and access to technical product experts ready to help you meet any challenge. Call, click granger. com or just stop by This message comes from Aive campaign Frustrated with spending hours on AI outputs that don't feel like your brand. Active Intelligence two point eight from Active Campaign keeps you from sounding like everyone else. Describe your tone, your rules, and your brand once, and Aive intntelligence builds every email and campaign for you with on brand images and content that sounds like you wrote it Marketers are saving ten hours every week and getting campaigns they're proud to put their name on. Import your brand in seconds at activecampaign d. com slash AI In the years after leaving General Magic Tony did a lot of reflecting about what went wrong What made this company that had all the best people, all the money, all the possibility He ended up writing his own book. It's called Build where he talks about his time at General Magic and all the lessons he took away You kind of turned what happened there into a list of everything not to do A few years after leaving General Magic, he was hired by Apple to work on this idea he had portable MP three player when you had a protype Steve Jobsot And he was like, Oh, this is this is great. I really want to do this thing. Now you have to remember This is march two thousand one ul was five hundred million dollars in debt Steve goes, I'm green lightighting this project. We need to do this They were going to have to do it on a budget. And Tony says that ended up working in his favor can have too much money You absolutely because you don't have constraints to make you think hard. When when you know the clock is ticking and the bank account is draining and you have to really understand what it is you're building, it focuses people Right at the outset, Tony says he and his team knew what they were making and had a very specific customer in mind who wanted a very specific thing I want to take all my digital music with me everywhere I go I want to take a thousand songs in my pocket We knew exactly what that product needed to do with a limited budget and a clear scope Tony says he looked for ways to build on what was already out there You didn't completely build it from scratch. Yeah, I went to all the different big companies and small companies around the world doing MP three to find the right processors ground level software necessary, the right batteries, the screens and everything else. So it's like, what are the Lego blocks I can get, stick them together, add a bunch of software, add a bunch of things to make this thing work Everything from the interface software to the chips to the batteries to the hard drive. even the design. In building the iPod, Tony thought of this Danish cordless phone he admired. I ran right to Bang and Olson and bought a couple Trum apart. Oh yeah, ye, that's just optal Optoc couplepler veted like I can just do that. No problem The result was the classic iPod design with the wheel and the button in the middle. The lesson Literally, you do not have to reinvent the Rotary, wheel. Tony gave his team deadlines. He was not just a leader, he was a manager Day one, he told them, We're going to need to do this by Christmas, which was less than eight months away Why? Because Sony was the number one in every audio category. I knew how Sony worked. They're going to come out with something this Christmas. And if it does, that means Apple is going to be canceling this project. I was like, this is going to have to work We must ship by Christmas And he says that big deadline wasn't the only constraint. He set up lots of little deadlines Tony and Apple got the iPod done and debuted it in months When we launched the product to worldor at Apple, literally two hours after that launch was done Steve called me in and said, let's talk about the next one. Oh wow. Literally we had not even shipped the one. He's like, I wouldn't w want to talk to you about the next one. Iteration. They kept tinkering with the iPod, kept releasing new models Tony worked on eighteen of them. General magic, we only got one we only got one shot because it took so long, so many years. We had no more money and so we never had the chance to make another go at it ple all those iterations of the iPod eventually led to the iPhone. And Tony worked on that too. the first three iterations. Now we're up to the iPhone seventeen. After the iPhone, Tony went on to invent the Nest thermostat And that was also wildly successful and kicked off an Internet of Things revolution. A lot of Tony's colleagues at General Magic emerged out of that chaos to do big techy things Some of them were early employees at Google. One of them invented the Android phone. anotherother one created eBay, one founded LinkedIn David Epstein says when he first started researching for his book, the thing that most surprised him was how the exact thing we imagine will get in the way of creative success can be the thing that makes it possible What everyone says they want is no oversight, no deadlines. L we could be so free and so creative if we could just, you know, fling sand into the air and make something out of nothing. Yeah, it's interesting because Anyw way you cut it in the abstract, people say they want more freedom And in reality It's it's often not good for them Our preference for complete freedom in the abstract is often a mismatch with what actually gets the best work from us and makes us the most satisfied