General Magic Had First Concept IPO Ever but Failed Despite Building iPhone Generation Early
"They were in the early '90s, they were the first so-called concept IPO ever where Goldman Sachs took them public without a product, just based on an idea because they had so much talent, so many resources. They were basically building the iPhone like a generation before it existed, before the internet even existed. They could do anything. So they did do anything."
About this episode
In this episode of The School of Greatness, host Lewis Howes interviews investigative journalist and bestselling author David Epstein about his new book Inside the Box: How Constraints Make Us Better. The conversation challenges conventional wisdom about freedom and options, with Epstein arguing that unlimited choice actually makes people less creative, less happy, and less productive. Drawing on research from MIT, the Census Bureau, and psychological studies, Epstein reveals that the average age of a successful fast-growing startup founder is 45, not in their twenties, and that people have become measurably more bored since the introduction of infinite scrolling. The discussion explores the story of General Magic, a 1990s company that received the first concept IPO ever from Goldman Sachs but failed despite having unlimited resources because they pursued every idea without boundaries. Meanwhile, employees who left with constraints created eBay and the Palm Pilot. Epstein introduces practical frameworks including satisficing rules for decision-making, the press release exercise Tony Fadell taught him for setting project boundaries, and batching work to combat what psychologist Gloria Mark calls self-interruption at the cadence we've become accustomed to. The episode becomes personal when Epstein shares how a devastating arm injury in eighth grade forced him to develop mnemonic memory techniques he still uses today, and how recent migraines forced him to become fanatical about his circadian rhythm, leading to better energy than ever before. Howes challenges Epstein to write his next book in six months with public constraints, and the conversation concludes with Epstein's three truths: optionality is overrated, happiness is love through real-world relationships with reciprocal obligations, and monotasking is a superpower that must be trained because merely having a phone visible reduces cognitive performance.
Key takeaways
- Research from MIT and Census Bureau shows average fast-growing startup founder is 45 years old, not in their twenties, because older founders identify specific customer problems from experience.
- Since infinite scrolling was introduced, people have become measurably more bored according to psychological research, contradicting the assumption that more options increase satisfaction.
- General Magic received the first concept IPO ever from Goldman Sachs in the 1990s but failed despite unlimited resources because they pursued every idea without boundaries while low-level employees left to create eBay and Palm Pilot.
- Venture capitalists deliberately target companies in slight debt because more startups die of indigestion than starvation according to Bill Gurley, meaning excess resources often hurt more than help.
- Studies show merely having a smartphone visible reduces cognitive performance even when not used, and the effect is stronger for phone-dependent people.
- People become accustomed to a certain distraction level and will self-interrupt with intrusive thoughts at the same cadence even when trying to focus, according to psychologist Gloria Mark.
- Epstein developed mnemonic memory techniques after a devastating eighth grade arm injury forced him to adapt, and recent migraines forced circadian rhythm discipline that gave him better energy than ever.