How did Carl go from $0 to $600 million in 3 years?
Read his advice on whether you should be like Tim Cook or Johny Ive
I am an entrepreneur. I build businesses and believe in the mantra of “daily progress”. I share everything I learn on the road to wealth. Here are take aways and reflections from last week:
How did Carl go from $0 to $600 million in 3 years?
If you win the 1st hour, you will likely win the day.
The secret to longevity is a cycle.
You can access previous editions of my weekly emails here. Let’s begin!
(1) How did Carl go from $0 to $600 million in 3 years?
He was the first person to get the iPod and the iPhone in Sweden.
On a family trip he realized that China makes really good hardware. He fell in love with a brand called Meizu which made MP3 players. He loved it so much he built a global community around it. The company ended up hiring him right out of university.
For the next 11 years, Carl Pei lived in China. He learnt how to build hardware. At 24, he joined Oppo. At that time OnePlus was being launched as a new brand to disrupt the D2C space. They were focused on China. Carl convinced the bosses to let him build the international markets. OnePlus has become one of the top brands globally since then.
By 2020, Carl left China. He had been working non stop, 6 days a week for 8 straight years. He started traveling the world, living in fancy hotels, enjoying drinks and dinners at the best places. But within 10 days he got bored. Anxiety set in because he felt like he was wasting his life. He felt like he wasn't contributing. He immediately wrapped up his trip and headed back home to Sweden. He started connecting with entrepreneurs to learn how to raise money. He managed to raise a seed round. NOTHING, the brand, was born.
Carl knew that to make a smartphone they needed at least $100 million and they needed to partner with companies that made smartphones like Foxconn. Foxconn had worked with 5 startups that had all failed so they didn't want to take a risk anymore. They got shunned by everyone except one factory that was going bankrupt. The strategy shifted to first making earbuds, building credibility and then finding a good partner to make smartphones.
The Ear-1 was launched. 5000 units were shipped out. 90% of them would not charge properly. It was a disaster! To save the business 15 engineers made a permanent base right outside the factory and QC'd everything. This lead to the sales of 600,000 earbuds. It was a very scary and uncomfortable experience but it made them stronger.
Carl says "there is a beauty to not having another option. It forces you to survive. I've seen that multiple times. Each time we come out a little stronger. Better processes. Better teams. Better partners. It's the desire to keep on living as a company."
When Carl got asked whether a person wanting to launch a hardware brand should be more Tim Cook (operations) or Johny Ive (design), he said: "Most people should be 90% Tim Cook because survival is the name of the game. Only when you survive can you pickup the volumes. With volumes you get stronger engineering teams. You get better prices. Over time you can become more like Johny Ive as you create differentiation in the product. 80% be safe. 20% take a risk. You can increase this skew overtime."
It is 2024, NOTHING is doing a business of $600 million annually, taking on the likes of Apple, Samsung, Google and One Plus.
Last year Apple spent $570 million / week. And NOTHING, spent $5.7 million / week, 1% of Apple.
This is how they spend:
1. Overheads: $366,000 / week
2. Salaries: $686,000 / week
3. Marketing: $390,000 / week
4. Building Costs (R&D, BOM, Production, Shipping): $3,900,000 / week
5. Total: $5,692,632 / week
For a 2 year old brand competing with the likes of Apple and Google, this is inspiring. Especially because I am building my business and brand in a bootstrapped manner.
(2) If you win the 1st hour, you will likely win the day.
The 1st hour of the day determines how much work I get done the rest of the day.
I have realized that momentum matters. On days that I get to work right after I wake up, I am able to get a lot more done.
Typically right after I wake up, I get out of my PJs and head outside to get some sun. I want sunlight to enter my eyes to signal to my brain that it is time to be awake. This just lasts for a couple of minutes. Humans typically perform at their peak when they follow the circadian rhythm.
I then drink a cup of coffee except on Sundays. This really wakes me up!
I then have a look at my to-do list. This is never empty. Something is always pending. When something gets done, something else gets added. It is a system that helps me prioritize what matters.
I then open a new journal entry for the day. It's a great idea to dump your thoughts on paper or on the screen. Usually your brain is problem solving at night. I will wake up with ideas, solutions and thoughts. Sometimes they are just feelings. Whatever it is I get it out of your mind and onto paper or screen. This process is very therapeutic. It is also a great way to make sense of what is happening inside. You will make connections. You will have aha moments. You will also make space for new thoughts and ideas. You brain is made to think so help it do its job.
In a perfect world I should be headed to the gym at noon. This is when the sun is at its peak. It is when the body is primed to perform. This often does not happen. I have calls to attend, teams to direct, sales to make. So I try to work around my schedule to make time for my body. I need to get a point to turn up everyday whether it is a session at the gym, going for a run or just doing 10,000 steps. The days I turn up for myself, I get a lot more work done. My mind is just better equipped to handle all the pressures when my body is put under stress to release endorphins.
As the day progresses, the mind is able to do less deep work. I try to do more process oriented work as the sun is setting. So the day starts with deep focused work and ends with calls and routine tasks.
After dinner with my wife, we stare at the screen to see some random show. Currently this is Slow Horses on Apple TV. I want to read myself to sleep but I usually fail to do so; my mind just revolts when the thought enters my brain. So unfortunately, Youtube wins the end of the day till my eyes shut on me.
(3) The secret to longevity is a cycle
I saw this and took a pic.
And then I thought about Warren Buffett and Charlie Munger. Charlie lived to be 99. Warren is in his 90s. They never got off the cycle of life. They may have slowed down but they never stopped peddling.
The day you put your feet up and say to yourself "I've made it. I can now chill!" is the day you'll start falling off the bike!
Never stop cycling. The ride may get slower but it must not stop. It's better to wear out than rust out.
Harsh Batra (LinkedIn)
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