Chapter 1

Apple Computer began as a two-man partnership in a garage. It grew rapidly and, by 1985, became a large publicly traded corporation with 60 million shares of stock and a total market value in excess of $1 billion. At that time, the firm’s more visible cofounder, 30-year-old Steven Jobs, owned 7 million shares of Apple stock worth about $120 million.

Despite his stake in the company and his role in its founding and success, Jobs was forced to relinquish operating responsibilities in 1985 when Apple’s financial performance turned sour, and he subsequently resigned altogether.

Of course, you can’t keep a good entrepreneur down. Jobs formed Pixar Animation Studios, the company that is responsible for the animation in the hit movies Toy Story, A Bug’s Life, and Toy Story 2. Pixar went public in 1995, and, following an enthusiastic reception by the stock market, Jobs’s 80 percent stake was valued at about $1.1 billion. Finally, just to show that what goes around comes around, in 1997, Apple’s future was still in doubt, and the company, struggling for relevance in a “Wintel” world, decided to go the sequel route when it hired a new interim chief executive officer (CEO): Steven Jobs! How successful was he at his new (old) job? In January 2000, Apple’s board of directors granted Jobs stock options worth $200 million and threw in $90 million for the purchase and care of a Gulfstream V jet. Board member Edgar Woolard stated, “This guy has saved the company.”

Understanding Jobs’s journey from garage-based entrepreneur to corporate executive to ex-employee and, finally, to CEO takes us into issues involving the corporate form of organization, corporate goals, and corporate control, all of which we discuss in this