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A Legacy Of Disruption: Tony Fadell, Principal, Build Collective Talking all things entrepreneurship with Tony Fadell, the mind behind multiple generations of theiPod and iPhone, who now focuses on startups that will change the world at Build Collective.

By Devina Divecha

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.

Tony Fadell is the principal of Build Collective, a company that focuses on impactful investment.

It's possible that you're reading this on a descendant of the device Tony Fadell helped design. You see, Fadell was once Senior Vice President of Apple's iPod Division- his team created the first 18 generations of the iPod, as well as the first three generations of the iPhone. After he left the American multinational, he was the founder and CEO of Nest Lab, the company that pioneered the internet of things (IoT), and his career trajectory has seen him author more than 300 patents, with him known today for being an investor and entrepreneur with more than 30 years of expertise. Fadell is today the Principal at Build Collective, an investment and advisory firm coaching deep tech startups, which is currently coaching more than 200 startups innovating game-changing technologies.

So, it's fair to say that Fadell has gathered a lot of valuable insights from his entrepreneurial journey, and it is with one such observation that he kicks off a conversation with me, saying, "You can ponder stuff all the time, but you have to do it, and that's the only way you really learn. Do. Fail. Learn." He then doubles down on this premise, saying, "Most businesses are not successful because they came up with a good idea, and then executed it properly. They came up with an idea, found out where it didn't work, kept changing it, and adapted and persevered. They understand that 'perfect' is the enemy of 'great,' and you need to keep iterating to find success. It doesn't just happen the first time- maybe, sometimes, that happens. But, most of the time, it doesn't, and you have to be ready for that."

And this is perhaps why Fadell stresses the importance of becoming entrepreneurial as soon as you possibly can in your professional trajectory. "You should start early in your entrepreneurial career, and not think you're going to be an entrepreneur after 10 years in a larger entity," he says. "You really need to go from big to small to startup, and not be afraid of being on your own. Because the biggest thing with being an entrepreneur is that you're going to be on your own for a little while, and you're going to have a tiny team." Note that Fadell is speaking from experience here- he clearly isn't one to preach without practicing himself. "I chased all my great ideas when I was younger," he says. "Something that I learned very, very early on is that it takes a team. Don't be religious about every idea. You need a team to help you see your idea from different angles, and where it could break and try to make it better." Fadell then adds that it is essential to have a mentor to guide you through the process, before concluding, "Those were some very key things that I learned through my decades of building things."

Now, Fadell has certainly built a lot- but not necessarily everything worked. After working on the Magic Link (which was essentially the predecessor to today's smartphones) with Japanese multinational Sony and the now-defunct US-based General Magic, and then similar concepts like the Velo and the Nino with Dutch multinational Philips, he ended up at Apple- and the rest is history. So, when it comes to product development, Fadell knows what he's talking about when he advocates for identifying and addressing consumer pain points first. "For me, it all starts with the pain," he explains. "Where is the pain? Where is it obvious? Where is it hidden? Can you go and solve that, and make a painkiller for it, and hopefully not just make a painkiller, but create a superpower? Give that person a superpower, so they can do that job in a way that makes them feel special. Typically, the pain gets removed, because new technology allows you to solve the problem in a different way than you could previously. That's what happened with the iPod. That's what happened with the iPhone, iTunes, and the App Store. The same thing happened with Nest."

Founded in 2010, Nest Labs -which launched its first product, Nest Learning Thermostat- was eventually acquired by Google for $3.2 billion in 2014, and Fadell left the enterprise a couple of years later. He is candid when talking about exit strategies, which can either be because the business is getting acquired or is going public, and he acknowledges acquisitions are challenging challenges mostly due to culture clashes. "Acquisitions fail 80-85% of the time, because cultures don't align," he says. "It's because the fundamental team that is being bought does not mesh with the other team. Then, if you go the initial public offering (IPO) route, then you have a whole new set of masters, and a quarter-to-quarter cycle… I wish I had something good to tell you… But, maybe, you could find an acquirer who has an incredible culture that you align with perfectly. And, maybe, you could have an IPO that, in some way you do differently, where you're not subject to the quarter-to-quarter whims of the market."

Today, Fadell is at the helm of Build Collective (previously known as Future Shapes), an enterprise that's all about impactful investment. The company's website states that it "invests its money and time to help engineers and scientists build a greener world, in which every person enjoys a longer, richer life." As such, its investment philosophy centers on deep tech innovations with the potential to disrupt major industries. "We are deep tech investors, which means we look for fundamental technology changes at the basic level, like quantum computing or artificial intelligence (AI)," Fadell explains. "Those kinds of things then can disrupt big industries. So, we go for big industries that can be disrupted by technological shifts, just like digital music was a huge shift, just like data networks were a big shift, just like the internet was a big shift. Those are the kinds of businesses we really like, and they have to be centered around climate, or health or society."

In 2022, Fadell published Build: An Unorthodox Guide to Making Things Worth Making, a book that saw him share advice and anecdotal insights into products that made an impact in the 20th century. And when asked about what will constitute an impact in the future, Fadell stresses the responsibility of entrepreneurs to consider climate change and other issues affecting the world right now. "Everyone should understand that they're either part of the problem, or they're part of the solution," he notes, firmly. Here, Fadell highlights that it doesn't matter if the business is not related to climate action specifically- but all entrepreneurs have a part to play. "Any business can do this- and you can do it at home too," he says. "It's not like you need to be in a direct carbon capture business to make changes… You need to make changes anyway."

In 2022, Fadell published Build: An Unorthodox Guide to Making Things Worth Making, a book that saw him share advice and anecdotal insights into products that made an impact in the 20th century. Source: Build Collective

And changes are coming, he points out. "Every single thing on this planet that humans have built, every non-biological thing, we need to blow up and redo. Whether it flies, it floats, it drives on the land- all that is going to get changed. We can already see it around us. So, how we do agriculture, how we create chemicals, what chemicals we create, how we do many of the basic things that have been created over the last 150 years, are all going to change, and that means all the companies that are running those businesses are going to change. We have to; it's an existential problem. We need to do this, because we need to keep customers on this planet buying stuff. You have got to think about climate change in a 'what's going to happen in the business and the business world;' so, it's just pretty obvious this change is good. We're going to need to do it. We have to do it. And it's going to be great for business."

Looking ahead, Fadell remains optimistic about the potential of emerging technologies like AI and quantum computing, particularly in sectors such as agriculture, healthcare, and societal needs. The entrepreneur says, "What I'm really interested in is the new technologies for agriculture, for building materials and for medical." Here, Fadell shares examples of companies he's working with. "I'm on the board of a company called Orionis, and we have a cancer vaccine that we've been building for years now," he shares. "It's actually in trials [right now], and it's working. We're working with another company called Prenuvo which does full body magnetic resonance imaging (MRI) scans, reinventing the way you do health and wellness outside the traditional system. That is what I did at Apple, Nest and even through my previous career of devices- which is taking technology, and applying it to the various fields that are outside of the general information technology or computing domain like agriculture, health, societal needs, climate. That is what is really interesting."

In terms of the future, Fadell says that he remains committed to supporting impactful startups through Build Collective, which is also why he wrote his book to give back to the ecosystem. "We are going to continue investing, and mentoring, and helping companies that we think are going to change the world," he says of the former, while adding that the book fulfilled a dual role of catharsis for him, as well as putting all his advice to companies in one place. "It's just rewarding, it's really helping people, and that's the goal," he says. "Also, every book I sell doesn't make any money for me. All the books that sell go back into a climate change-related fund for new startups." For entrepreneurs in the Middle East who might look up to him, Fadell offers advice rooted in the concepts of localization and community engagement. "Fix local problems," he says. "Everybody thinks, 'Oh, I'm going to run a Silicon Valley company, and I'm going to solve Silicon Valley problems.' No- there are problems all over the region that can be solved. Go look for those things, and solve those issues at a grand scale, bring technology from other parts of the world, and bring it there to solve the local problems. So, look for the pain- and bring the painkillers to people in need in your area."

Related: Shifting Mindsets: Growing A Culture Of Impact Investing In The MENA Region

Devina Divecha

Writer, editor, emcee, and media consultant

Devina Divecha is an independent writer, editor, emcee and media consultant, specialising in the hospitality and F&B industry. With more than 10 years of experience under her belt, her work has appeared in a number of publications including Skift, SUPPER, HOTELSmag, Destinations of the World News, Spinneys Magazine, Entrepreneur Middle East, and more. She holds a BSc in Business from the London School of Economics and an MA in Magazine Journalism from the University of Sheffield.

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