Today, IKEA operates over 300 stores in 40+ countries.
Apple has over 80,000 employees.
And the Virgin Group is made up of over 400 companies.
These three companies are amongst the biggest in the world today. They are what most startups hope to one day become: experts in their field, with a clear vision and the desire to constantly evolve.
They also have remarkable leaders who had a vision to create something life-altering. Ingvar Kamprad started his first business when he was only five years old, selling matchboxes for a profit. Steve Jobs, at the ripe old age of 12, called up Bill Hewlett asking for spare parts for a computer and subsequently landed a summer job at HP. Sixteen-year-old Richard Branson had a poor academic record but a terrific ability to connect with others.
What they all had in common was a desire to constantly seize opportunities. Shaping their companies in line with a vision that revealed the depths of their entrepreneurial spirit, they eventually created a legacy that revolutionized the ways people work, live, and entertain themselves.
Let’s take a look at their early days, before they made the breakthrough that made them what they are today:
What Ingvar Kamprad can teach us from IKEA’s early days
Today’s IKEA bears little resemblance to the IKEA that Ingvar Kamprad founded in 1943. Back then, it was a mail-order company that sold everything from pens to watches to furniture to cards. It was in 1952 that Kamprad decided that IKEA should focus only on furniture and interior decoration. It took one more decade to decide that IKEA would sell mainly through large physical stores, not mail-order.
The lesson here? After testing a series of different strategies, Kamprad decided to focus on one thing only. He found his niche and then cut away all that was superfluous and not in line with his strategy.
The result is the stores we are familiar with today - full of endless exhibits, model kitchens and bedrooms and living rooms, quirky product names and tasty Swedish meatballs (IKEA doesn’t sell you discounted food just because they’re nice. They do it so that you stay in their store longer).
The second lesson to learn from Ingvar Kamprad is practice what you preach. IKEA was founded on the basis of making well-designed, affordable furniture available to the everyday person. This philosophy of affordability, efficiency and simplicity is one that Kamprad has embraced throughout his life.
Even as an 85 year old multibillionaire, he still flies economy, encourages his staff to dress casually, stays in cheap hotels, and drives an old Volvo. IKEA’s culture is one of no-nonsense, cost awareness, and treating employees well. The company has very few allegations of poor labour practices, bad environmental policies, or arrogant customer service.
Fun fact: On the weekend, people are twice as likely to go to IKEA as to church in the United Kingdom.
When Apple was a shop in Jobs’ parents’ garage
In 1975, Steve Jobs and Steve Wozniak set up shop in Job’s parents’ garage. They had 1,350 dollars in capital, which they made from Jobs selling his Volkswagen microbus and Wozniak selling his Hewlett-Packard calculator.
In those days, very few people had access to a computer. Programming - done on punch cards - was extremely cumbersome and time consuming. Home computers did not yet exist.
“We started out to get a computer in the hands of everyday people, and we succeeded beyond our wildest dreams.” - Steve Jobs
In brief, they wanted to build the best thing they could build. Wozniak and Jobs’ vision for a computer accessible to the everyday man sparked the PC revolution and made Apple the icon it is today.
One of the most important things Apple will teach us: For every product Apple designed, Jobs wanted to make something that was practical and beautiful at the same time. He didn’t only want a product people would use, he wanted a product people would love. This attention to aesthetic detail is what set Apple apart from competitors like IBM and Microsoft. Jobs explains his passion for making beautiful products in the following passage:
“When you’re a carpenter making a beautiful chest of drawers, you’re not going to use a piece of plywood on the back, even though it faces the wall. You’ll know it’s there, so you’re going to use a beautiful piece of wood. For you to sleep well at night, the aesthetic, the quality, has to be carried all the way through.”
For Jobs, every tiny aspect of the design had to be just right. If a product was functional but not beautiful, that wasn’t good enough. It could always be both.
The second lesson Jobs has to teach us is: embrace a startup culture, even when you’re no longer a startup.
As a company grows in size, it’s easy for hierarchies to develop that hinder easy exchange of ideas and stifle innovation.
However Apple, despite its thousands of employees, still works with a minimal bureaucracy and takes pains to respect its employees by promoting their personal development. Also, like in its early days, Apple is still run by engineers. Most product teams are small, and many product managers have an engineering background.
The result? There’s not the typical division between managers and code monkeys, and managers have a real understanding of the technology involved.
Fun fact: Jobs would constantly be trying out different diets, learning at a young age how to reach euphoria and ecstasy by fasting. He once ate so many carrots that he turned orange.
Richard Branson: not the biggest, but the best
The Virgin Group today consists of more than 400 companies. Back in the late 1960s, charismatic Richard Branson was struggling in school, dropped out, and founded the magazine The Student. His old headmaster, Robert Drayson, said that he would either end up in prison or become a millionaire.
As it turns out, Drayson was right. Branson made his first million in 1973.
Richard Branson’s lesson to entrepreneurs is to diversify. After founding The Student, which advertised popular records, Branson went on to start a mail-order record business in 1970. A year or so later, he opened up a record store. In 1972, he launched the record label Virgin Records. One of Virgin Records’ very first releases, Tubular Bells by Mike Oldfield, is what earned Branson his first million. The Virgin Group has now expanded into airlines, green energy, mobile phones, even space travel.
By diversifying into complementary industries, Branson created a powerful infrastructure to reinforce his various businesses. As the owner of a magazine, several record stores, a record label, and a nightclub, it became very easy to promote for example a new up-and-coming artist signed to Virgin Records.
So why didn’t he just provide all these services under one massive company?
Because big companies don’t always work better. “Small is beautiful”, said Branson. Smaller companies can stay more nimble and customer focused. Virgin Records is far from the biggest in the industry but still managed to attract legendary artists like the Rolling Stones. Virgin Airlines has only 37 planes, not 700+ like its competitors, but offers cool in-flight services like an onboard bar, massages, and flexible food ordering services. Who said flying isn’t fun?
In the end, Branson thinks that given the choice, it is always beneficial to spin off a company into a second, smaller company (like he did with Virgin Atlantic and Virgin America). When you’re smaller, it’s easier to uphold a cheeky, inquisitive company culture. And after all, Branson wasn’t out to be the biggest; he was out to be the best.
Fun fact: Branson once tried to circumnavigate the globe in a hot air balloon.
Which of these three business leaders do you identify with? Have they influenced the way your team works? Share it with the Sandglaz Team and other readers in the comment section below!