From Ben Sandofsky
Why You Can't Build Apple with Venture Capital
An ex-Apple designer who went on to startup success once told me, "I wish I could give a workshop for Apple jumping into startups, to help them un-learn The Apple Way." As someone who strives to build products with the craft and quality of Apple, it pains me to admit that The Apple Way can destroy a lot of startups. Which brings us to Humane.
The pin shipped with fraction of the features promised at its unveiling eleven months ago, and what features that did ship fail most of the time. It's too heavy, and has atrocious battery life, with users expected to swap batteries every few hours as the device runs uncomfortably hot. Its projector is useless in daylight, and its input system is awkward and slow. For a device meant to replace your phone, you expect an experience faster than just whipping out your phone.
Despite all its quirks, Humane might have worked out if it followed a traditional VC startup formula. Instead, they tried to follow The Apple Way, where 1.0 products need to be so insanely polished as to blow everyone away.
The Apple Way works best when they take an existing product and make it amazing. It also helps when a product leverages Apple's existing ecosystem, and the goodwill Apple had earned from customers.
Humane spent five years developing their product in a vacuum. They had little evidence people want to ditch their phones. They didn't know what form factors users would tolerate. They didn't have normal people telling them battery swaps are dumb. But the most damaging consequence of their delayed launch was missing the chance to strike while the iron was hot.
It's obvious that Humane pivoted to AI late in the game, and it's obvious how they got backed into that corner.
It's that funding that will be Humane's undoing. Before the Ai Pin launch, they convinced investors the company is worth $850 million. When they go back for their next round, they need to argue with a straight face that the company is now worth $1.7 Billion.
It's very likely that the next time Humane raises money, they'll have to value the company less than what they told their last group of investors. These "Down Rounds" screw recent investors and employees, as the stock that they bought is worth less than what they paid for it. It also has a chilling effect on longtime employees. Do not be surprised by an exodus.
Humane's follies were amplified by overconfidence, as if they thought they were still working at Apple. When Apple launches a thing, they tell you it's the best thing in the world. More often than not, they're right. People are attracted to confidence, so I get why it works in Apple's favor, but if you come for the king you best not miss.
If there's a tragic lesson to learn from Humane, it's that if you spend all of your time dwelling on the past, you'll miss your chance to shape the future sitting right there in front of you.