Bushnell talks about an upcoming Atari movie, and how he hopes it will be about encouraging entrepreneurship. I’m there day one.
Atari is a very fun company to study because, at one point, it was the fastest selling company in American history. Think about that. Faster than companies even in the Industrial Revolution. Atari’s origins are also Apple’s origins as Apple was founded by ex-Atari employees. At one point, Atari was going to be the sole publisher of the NES. It was possible that Nintendo and Apple could have been under Atari’s roof.
The way how Atari was run was fascinating. Bushnell went to the employment office and got people literally off the streets. Steve Jobs later described these men as having huge, giant beards that you couldn’t even see their faces. The smell of marijuana floated through the building. Imagine having investors come to visit the site and see employees, scraggly, wearing jeans and being barefoot. Bushnell’s management was also unique in that he would rely on his instincts and, when he saw something an employee had made that he liked, would simply say “Neat!”. If I recall, employees could come and go as they pleased in Atari. Since everyone was so young, Atari obtained rock bottom health insurances that were probably the cheapest any company got at that time. Many employees used it for braces not for their kids but for themselves. There was also an Atari fund for getting employees out of jail and ending unwanted pregnancies.
The entire investment Bushnell made on Atari was $200. When he eventually sold the company, he got, I believe, $22 million. A very good return.
As an entrepreneur myself, you cannot know the glass guys like Bushnell had to crawl over to get his dream a reality. When one pursues entrepreneurship or has it on his resume, you are basically blacklisted from employment. No one wants to hire entrepreneurs except other entrepreneurs (who go so far to encourage it among their employees). Entrepreneurship makes life far more fun than the dreary job world. It would be fun to interview Bushnell over entrepreneurship, and I’d be fascinated to hear him speak about it in any detail of his choosing.
I wonder how it must have felt to have founded and put your heart into establishing a business, which everyone said couldn’t exist, only to have to be told what to do by prick-like elitist Wall Street type who think you are a bumbling idiot that ‘just got lucky’. I imagine Bushnell wanted to rip these people apart.
“Nobody thought that video games represented a business. That’s the part that I think a lot of people don’t understand; if you really work it, you can turn your dream into a reality. It’s not because the bankers like you, it’s not because Wall Street likes you, it’s because they all think you’re an idiot. But if you keep your dream in tact and just work as hard as you can, you can often pull it off.”
To give you an idea of how Wall Street thinks, they would gladly sell America to Red China if that meant being assured of the next two years of full growth. They are short term thinking and all thing they are smarter than everyone else including the entrepreneurs who make the business world work. Even Steve Jobs was fired for not ‘knowing’ how to run a business. When Bushnell says bankers and Wall Street, think of the analysts, and you’ll see similar personalities.
I wonder if Atari, meaning Phil Harrison’s company, is going to begin rapidly ascending. Phil Harrison is at the head, and he is clearly in front of the next entertainment wave of social games. The Atari movie will just excite people’s passion in all things Atari meaning more goodness to Phil Harrison’s company. Maybe I should start buying Atari stock.
Bushnell’s comments on Wall Street remind me of something I saw before the Wii launched. I remember reading many, many reports on Xbox 360 and Play Station 3 in their upcoming battle to take over the living room. Christensen’s disruption was even cited for them and how it would change all entertainment business. Nintendo was never mentioned. This reveals to me two things:
1) The excitement for ‘taking over the living room’ was sprinkling fairy dust into analysts’ eyes. Even today, they can’t get the fairy dust out of their eyes and think, especially the PS3, will rocket up because it took over the living room. I can’t emphasis how excited Wall Street was over this.
2) Wall Street still has zero interest in the video game business. They were completely disinterested in the DS-PSP competition (why? Because of number one). When you hear analysts talk, they never talk about terms specific to the video game business. You never hear them cite history of the NES generation or even Atari or even SNES vs. Genesis. They are more interested in exchange rates, in the technology used in the consoles, in the Blu-Ray adoption rate, in how movie business is contributing, and the ‘brand’. They have ZERO INTEREST in gaming itself.
Gamers have picked up on this and grow angry at these characters. When analysts hear angry gamers, they think, “Oh, he is playing games so he thinks he is more of an expert at understanding games and their future. Reasonable for why they are angry.” It is not because gamers think they are MORE of an expert about games, it is because analysts have shown ZERO INTEREST in studying the business of gaming. I NEVER hear any analyst ask these questions:
”Why is Wii Sports attracting so many newcomers?”
”Why is Mario Kart Wii selling more than previous Mario Karts? Why are such Nintendo franchises still vibrant while most franchises end up in decline?”
”Are there any parallels between this generation and another? Has this current phenomenon occurred before?”
”What is the nature behind the Wii mania? Or the DS mania?”
”Why has disinterest grown behind the HD Twins?”
”What was it about Yamauchi that gave him the ‘golden touch’ to the market?”
”How did Bushnell create a huge gaming business only on $200?”
These are all relevant, indeed critical, questions for this cycle. They are never asked because they have no interest in the GAMING business. Analysts don’t care why a new hit game is a hit game. They only care why Blu-Ray or other non-gaming factors haven’t taken the PS3 off yet.
To those who disagree, consider this. With the extraordinary growth and even drama of the games business, where are all the business books about this? Why am I essentially alone in investigating Nintendo’s business strategy? It isn’t this way in the tech world that is super-saturated with articles and opinions. Gaming, however, is non-existent.
Analysts ignore Nintendo because Nintendo is all about gaming. They don’t want to study that. They want to study tech business aspects which are why they were all over the HD twins.