iPod, the rejected startup

Tony Fadell helped develop handheld devices for General Magic and Philips. Tony had a vision of a portable MP3 player complemented by an online music store. His startup, Fuse, couldn’t get VC financing to build the product. He shopped the idea around to big companies such as Real Networks and only one company decided to experiment with his idea, hiring Tony as a contractor to build a prototype in two months.

The first review on Slashdot in October 2001 called the product “lame” and “not very exciting” for lacking wireless and a bigger hard drive.

The original iPod

The product idea became the Apple iPod, and sold 125,000 units in its first three months and 14 million units in Q1 2006. It almost didn’t happen, but Apple took a chance on a team they had worked with in the past to build something completely new.

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Commentary on "iPod, the rejected startup":

  1. John Diffenthal on wrote:

    When Sony did their initial research for the Walkman they found that users didn’t want it. They had asked if people would buy a tape player that couldn’t record. The research focused on product attributes which were determined for very good technical reasons

    It was only when they revised the question so that people were prompted to think about a light weight player which would provide music when jogging or walking that people responded more positively.

    Sony went ahead on the basis of the revised research and became the category leader for many years – branching out into Walkman radios, CDs and minidisks on the way.

    Ideas come up continuously and the VCs and the investment committees don’t have much time to decide whether or not to explore an individual opportunity further. Most get rejected because that is a lower risk than going ahead – the failure rate on new ideas is catastrophic.