Permanent Equity: Investing in Companies that Care What Happens Next

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What Makes Special

If you haven't yet read this profile of Apple CEO Tim Cook, I recommend it. In a world where succession planning is hard, whatever Apple figured out way back when has worked out and then some. Maybe it's because (not to be crass) Cook’s visionary predecessor Steve Jobs wasn't around to “offer assistance” or maybe it's because Jobs's last advice to Cook was to do what was right, not what Jobs would do, and Cook listened. But any explanation probably oversimplifies the factors that have helped Cook have an incredible 13-year run in his role.

Of course, the world didn’t always view Cook so favorably. After I asked for your thoughts on successful successions, I heard from Kyle who said that not long after Apple picked Cook he heard the inspirational Simon Sinek speak on the matter. Sinek thought Cook was a terrible choice and gave him “24 months before being fired.” Opining on that, Kyle said that maybe one way you know you’ve picked a good successor is that everyone thinks you’ve picked a bad successor. 

I rolled that point over in my head on a long run and wondered if maybe there isn’t something to it. That’s because it seems logical to believe a good successor is someone who will run a business like its predecessor did. But it’s probably the case, and I understand that I’m trafficking in the world of counterfactuals now, that someone who wasn’t Steve Jobs that tried to run Apple like Steve Jobs would have failed spectacularly for many, many reasons. But even the fawning profile linked above notes that while Apple seems less “magical” today under Cook, it’s “more predictable” and “a whole lot more valuable.”

As for why that is, a lot of ideas in that profile resonated. Some highlights:

"Every day, every product."
The person most vested in your stuff is you. If you can't be bothered to use it, why should the world?

"Not first, but best."
You get better outcomes when time is your friend, not your enemy.

"Innovation is everything that happens after the idea."
What's special is the work of turning something that's never been done before into reality.

"The more curious you are, the smarter you get."
I wholeheartedly agree.

At $3.6 trillion, Apple is the world’s most valuable company and it seems that one way they got there is by using their stuff, making it better, working hard, and asking questions. And maybe that isn’t magical, but it is special.

Tim


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