Founders - #83 Thomas Edison, Nikola Tesla, George Westinghouse, and the Race to Electrify the World

Episode Date: August 4, 2019

What I learned from reading Empires of Light: Edison, Tesla, Westinghouse, and the Race to Electrify the World by Jill Jonnes.A list of all the books featured on Founders PodcastJeff Bezos on The Electricity Metaphor for the Web's Future ----Founders Notes gives you the ability to tap into the collective knowledge of history's greatest entrepreneurs on demand. Use it to supplement the decisions you make in your work.  Get access to Founders Notes here. ----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast

Great indeed is the power of electricity, and in the final decades of the 19th century, three titans of America's Gilded Age were among the Promethean few who dreamed of the possibilities hidden in this force of nature, its awesome power visible only in the wild rumble and slash of electrical storms. Each titan was determined to master this mysterious fluid. Each vied to construct an empire of light and energy on a new and monumental scale. Each envisioned radiant enterprises that would straddle the globe, illuminating the night and easing forever the burden of brute labor. This is the story of the nascent years of the electric power industry and the rise of a new technology that completely transformed society. A tale told largely through three visionary today, which is Empires of Light, Edison, Tesla, Westinghouse, and the Race to Electrify the World by Jill Jones. So this one paragraph just gives you an idea of the time that this entire story is set in.

It says, the miracle of the great Atlantic cable flashed telegrams across the coldest depths of the ocean, where once letters from J.P. Morgan's father, J.P. Morgan actually plays an important role in this story. I didn't know that going into the, before I read the book. Once letters from J.P. Morgan's father in the London office took weeks to arrive, now telegrams pulsed through in mere minutes. The railroads had become mighty, creating new cities where there'd been only marshland or prairie.

And in just the past year, they had laid an astounding 10,000 miles of track. The 1880 census, that's where the story begins. It's going to go all the way up until the early 1900s. Census showed 50 million Americans. J.P. Morgan, unlike many of his old money peers, relish this new temper of the times. He admired men like Edison who were bold, ambitious, hardworking, and confident. So not only does J.P. Morgan play a role, which I'll talk, expound on later on in the podcast, in financing some of these electrical companies, but he also had the first, his house was the first private home

in New York City that was lighted up and actually wired for electricity. And one of the main takeaways of this story that I was thinking about is how important it is to study like that, you know, the electrical industry is now massive and we could not imagine living without it. But at the very beginning, things look very different. And so humans have the tendency to look at how things are now and extrapolate in the future that it's just gonna be the same. And obviously that's not the case.

And so here is how individual houses were able to have electric lighting at the beginning of this industry. And think about how different this experience is taking place in J. in JP Morgan's house as it is in where you live. And it says they were run by generators. It says the generator had to be run by an expert engineer who came on duty at 3 p.m. and got up steam so that any time after four o'clock on a winter's afternoon, the lights could be turned on. Now think about that. We flip a switch. They had an actual person in the house, and he had to be an expert engineer. He says, this man, so it starts at 4 o'clock.

This man went off duty at 11 p.m. It was natural that the family should often forget to watch the clock. So then at 11 p.m., all the lights turn off. He says, the lights would die down and go out. Then there was a careful groping about in the had either lit candles or you lit gas-powered lamps. A lot of people complained they'd have gas-powered lamps in their house and it would produce headaches and other kind of issues with your health. Candles obviously sometimes started fires. So the light bulb was a huge step up. And so people would jump through hoops to be able to get access to this new technology. And what I found interesting was once it was wired up, Morgan had obviously with any new technology,

he had all kinds of problems. So like sometimes they would bury the uh the electrical lines underneath his floorboards and then put like a rug on top there'd be like small fires or like burning so they and then they had to rewire the house over and over again but he was just so happy um that he wound up being a good like early salesman for the edison electric company which is the one he's he financed. One of the ones he financed, I should say. But this paragraph just reminds me that this is like the influencer marketing in the early electrical industry. The banker they're referencing, Morgan, was subsequently so delighted with his electricity that he gave a reception and about 400 guests came to the house and marveled at the convenience and simplicity of the system.

Two of the guests, California gold rush millionaire Darius Ogun Mills and his son-in-law, New York Daily Tribune publisher White Law Reed, promptly contacted the Edison Electric Illuminating Company to have their own houses electrified. So we see that obviously happen a lot where there's people we admire. They start talking about other products, and very soon we say, hey, we want that product as well. And then I just want to – we're going to jump jump in and we're going to go back and forth.

So this is going to be a little different because normally I focus on just one person, right? And I originally was reading the book. I'm like, okay, well, maybe I'll do separate episodes all about the book. One based on Edison. Take each person at a time because they're hugely important, hugely fascinating people. And then the more I got into the book, I was like, no, you know what? I'm just going to make this maybe even if the podcast is a little longer. They're just the dynamic between all these three is so fascinating. It was like this belongs in one podcast, in one story, in one sitting. So with that said, I do want to read this

part. And we're going to jump around between the people, obviously, why this period, in my opinion, was so important. So it says, but for the visionary capitalist, electricity possessed other, more practical allures. Already, this astonishing, invisible agency had birthed two radically new technologies, the telegraph and the telephone, that had forever compressed and altered the age-old realities of time and distance. The most farsighted were tantalized by even greater electrical prizes. Who would further harness electricity to light the nation's streets, its dim factories, and all those millions of households, dramatically transforming man's

age-old sense of day and night. Like I was just referencing, once the sun set, if you didn't have candles, you didn't have lamps, that was the end of your day. Of even greater moment in these commercial times, who would harness electricity to operate work-saving machines, mechanisms artfully reinvented to liberate humankind from the hard toil of farm and factory? He who could unleash the full only dreamed of potential of electricity and control this awesome invisible power would become wealthy and powerful indeed. Was it any wonder the war of electric currents would be so fiercely waged?

So that may that that's actually what this book is about. That that term there, the war of electric currents, that is what the battle between the entrepreneurs, Edison with his direct current and then Westinghouse and a few other people. And then obviously the inventions of Tesla with the alternating current. And now before I continue talking about Edison, I want to take a slight tangent, a slight right turn here, because I always talk about this idea that books are the original links. They lead us from one idea to another or one person to another, much like the modern web does. And in this book, and this kind of relates to what we're doing here, right? In this book, a lot of people, a lot of early entrepreneurs, inventors, tinkerers

in the electrical industry were going off of and inspired by people that came before them, right? So when I talk about founders podcasts to people in person, I was like, listen, what is Elon Musk, Jeff Bezos and Steve Jobs have in common? And the answer is they all learned and studied from entrepreneurs that came before them and that influenced their ideas in business and how their life turned out, right?

Well, a lot of the early inventors in the electricity field were influenced by Faraday, Michael Faraday, who you might have heard of. And this book, Empires of Light, talks a lot about Faraday. So I'm only going to read like two paragraphs about him, just so you understand who he is. He's hugely influential. And this caused me to find biographies on him. And he's going to appear in a future founders podcast. He's not technically an entrepreneur, but he thinks like one, he acts like one. So let me just read this part before I get into Edison. And Edison was hugely influenced by Faraday. So this is one quote from a biography on Faraday. He says, such was the prodigality of his output and the diversity of his skills that modern chemists, no less than physicists, He says, and the practical consequences of his discoveries have profoundly influenced the nature of civilized life.

And then this is, is this a quote from him? Okay, yeah, this is Faraday. He says, a philosopher should be a man willing to listen to every suggestion but determined to judge for himself he should not be biased by appearances have no favorite hypothesis be of no school and in and in doctrine have no master truth should be his primary object and then in turn so all edison and a bunch of other these uh maybe even tesla were inspired by faraday faraday was in turn inspired by benjamin franklin he says faraday liked to quote benjamin franklin um so they were asking like what what is the before i read you the quote um like he would create like a new chemical process or a new electromagnetic realm and then people would inevitably over and over again when he'd make some kind of discovery like what is its use

like i don't understand and it says Faraday liked to quote Benjamin Franklin, who had famously replied, what is the use of an infant? The answer of the experimentalist is endeavor to make it useful. So saying it's our job to make these discoveries useful and practical. And that's exactly what they were doing.

The book talks about, they were experimenting. There's records of humans experimenting with electricity for a couple thousands of years. And in some cases, there'd be progress. Then nothing would happen for 500 years. So somebody else picks it up. And then 200 years. And then finally, in the late 1800s, we have huge amounts of progress.

All right. So this is what motivated Edison to work on electrical lighting. At this time, he's in his mid-30s. He's already super, super famous, one of the most famous Americans living easily. And this actually worked to his benefit in starting his company. He said, Edison, so he was, at first, his friend was trying to get him to go check out like these new electrical dynamos and these experiments with with lighting and he was he's like no i'm too busy too busy then eventually he goes and he's blown away and he says edison was now a fire with excitement ever the competitor he turned to his host william wallace and said i believe i can beat you making the electric light i do not think you're working in the right direction.

So something that Jill, the author, talks about a lot is Edison's extremely cocky. And I covered this a little bit because if you're longtime Founders listeners, remember, I think it's like Founders episode number two. I did the Thomas Edison biography, The Wizard of Menlo Park, and they talk about that a lot in there. He was extremely confident in his own abilities. So he says, Edison rushed back to his research workshop to throw himself into creating a better and more practical electrical light. This is actually an important part.

He worked feverishly, thrilled at the possibilities of this new field. It was all before me, this is a quote from Edison, I saw the thing had not gone so far, meaning the industry is still new, but that I had a chance. I saw what had been done and had never been made practically useful. The intense light had not been subdivided so that it could be brought into private housing. So that's an important part.

It's like you've got to lower that. It's too bright. And he understood at the very beginning, of course, people are going to want an alternative candles and k, it's like an 18-minute talk. I took notes on it. I'll actually link my notes in the show notes so you can read them if you want. And it also links to the video. But Jeff's like, listen, a lot of people, and this talk is like 15 years old, right? And in it, Jeff is like, a lot of people think like the early, the analogy for the internet revolution that we're going through right now is the gold age. He's like, no, I don't think that's the right metaphor.

And he gives all these examples from history of how he thinks about it. And he says it's the growth of the internet is going to be, is going to look closer to the growth of the early electricity industry, which is really interesting. And because Jeff was like, they're not people were not saying hey like why are my house for electricity they were they said why are my house for lighting and he's saying essentially the killer app of the electric industry before um uh was the light bulb and this is what edison is working on right now where we're at in the book he's like well i i actually think that i could be doing this better. I can make it more practical, which is obviously what he endeavored to do for all his inventions.

And he winds up succeeding because he gets the patent. He winds up fighting patent wars for, I don't know, there's probably hundreds if not thousands of lawsuits trying to stop people from infringing on his patent. And it's upheld all the way up to the Supreme Court, if I'm not mistaken. And so Edison gets the patent for the first, I think it's incandescent bulb. So that's what he's working on here. He says, the man who came up with the best arc light system might well make a fortune stealing away even that 10% of the gaslighting business.

And he's saying, so even on the tiniest, and that's, he's just talking about streetlights. So even if you could just take 10% of the gaslighted streetlights, you already have a fortune. So they knew from the very beginning, the size and the magnitude of the industry. But the man who could subdivide the light to take it indoors and tame it into a gentle glow, which is what the light bulb does, right? And power it with a dynamo, which that doesn't happen anymore. At least not in the way they did it back back then he would be the true promethean the blazing electrical pioneer the hailed benefactor of humankind and he become wealthy to boot the race to illuminate with electricity the houses and offices of america was on okay so we're going to stick with Thomas Edison for a little while because how Jill,

the author, she starts out talking at, she basically built a foundation to understand how each individual thought about electricity one by one, gives us some background, and then the story unfolds and how they interact with each other. So this is just, I'm going to do a brief introduction to Thomas Edison. He says, Thomas Edison had announced he was becoming a full-time inventor in early 1869. So now we're going back in time. Okay. The previous six years had been spent drifting from city to city as a Western Union operator, while he was continually devising improvements in telegraphy. Remember they just referenced to set the stage for the time we're in,

the two huge improvements with human communications. One of those, telegraph. And he was soaking up technical books on telegraphy and electricity. He's a lifetime veracious reader and learner. Once committed to full-time inventing, Edison had done well enough with such clever items as an electric copying pen.

But he really hit the jackpot in late 1974 when he sold rights to his quadruplex telegraph system to Western Union and Wall Street manipulator Jay Gould for $30,000. I'll give you an idea at the time what that $30,000 means. A typical laborer, let's say when the the electrical industry is up and about they have tons of people like laying the wires like you know working people in the field they would make about 12 a week okay so this says this was uh this was heady success for a small town boy from port here on michigan whose father had muddled along in various grocery, real estate, and truck farming enterprises. Edison had received very little formal education, being taught mainly by his mother. His boyhood revolved largely around his many ingenious efforts to make mechanical things or brew new chemistry experiments, including one that produced an explosion that wrecked a corner

of a building and burned Edison and some of the boys. When Edison was 13, he joined the Grand Trunk Railroad as a newsboy. He impressed his bosses as a hardworking, entrepreneurial, and intent on self-improvement. Those are really good traits to have, those three, hardworking, entrepreneurial, and obviously focused on self-improvement. He spent $2 to join the new Detroit Public Library, which was two days of his pay at the time. This gives you an indication of how hungry he was for knowledge. So he spent two days pay to join the Detroit Public Library and proceeded to read his way through the shelves. It was during these railroading years that Edison became partially deaf. Now, I didn't remember this part. I knew

he was partially deaf because he has some funny lines about being partially deaf saves him from the cacophony, I think is the word he used, of the ridiculous everyday talk that people have. But the reason I want to bring this to your attention

is because I think there's a lot of things that we can't control that happens to us in life, but we can control the frame of mind in which we look at these things. And he took a positive spin on a very negative event. He says, so this guy, one of the conductors grabbed him by the ear for some reason and lifted him, and something snapped inside one of his ears, and his deafness started from that time.

So it's a terrible thing to happen, right? But he says, ever the optimist, Edison viewed his deafness started from that time so it's a terrible thing to happen right but he says ever the optimist edison viewed his deafness as an advantage a built-in buffer against outside distractions that helped him concentrate on whatever he was doing edison's avid curiosity about all things mechanical had led him to befriend the local telegraph operator wherever he was when edison turned 16 in 1863, his natural flair for banging out and receiving Morse code, which was honed by 18-hour bouts of practice,

earned him a slot as a junior operator. The Civil War was going on at this time, and telegraphers were in great demand. So sometimes you're at the right place at the right time. Timing is really important in these things. And so Edison was launched into the world of telegraphy,

invention, money, and getting ahead. So now this is Edison's approach to work and the power of inspired work and the different paths you can take. So when Edison was onto a problem, there was no day or night, just hours in which to work as his long-suffering, neglected wife and two small children well knew. So I bring that up because obviously we want to grab the best ideas from a lifetime of experience that these entrepreneurs have, right? But we also want to learn from their mistakes. Now, it's great to work on something you're passionate about, to love it so much that you want to dedicate a lot of time to it. Very few people in life find something like that. But to me, in my opinion, family is extremely important. So I don't think neglecting your wife and your two small children, he winds up having six children um and you know he's basically sacrificed his family life

for invention uh you have to be who you are it's just uh for me that that that's a bad trade he winds up some of his kids wound up being estranged and they basically say he's a crappy father um edison could rarely pull himself away long enough to dine at home instead of fueling himself on yet another slice of apple pie that was a really weird thing that i learned that he sustained himself just to be eating apple pie um so now he's oh and this this is a sign of his cockiness remember he he toured uh william wallace's shop and it says a mere week since the tour of wallace's shop edison pronounced with his characteristic hubris to the reporter from the New York Sun that he, Edison, would be the one to succeed with the electric light where others had failed. He, Edison, would be the Prometheus. They use that word so many times in this book who would define the secrets of this mysterious agency and light up America and the world.

He had, in one inspired week, just invented the first practical incandescent light bulb so that is partially true but partially not true he had got one set up in one week yes but then he would he would the search for the right material i think it was a filament is what they're called took a very long time after that so the basic idea was there after one week and he had to run constant numerous uh maybe countless is the better word experiments to try to find the filament that wouldn't burn out and that could actually last. He says, I have, and this is Edison, and he's not going to give too much details because he hasn't secured the patents yet. But he says, I have obtained it, the light through an entirely different process than that from which scientists have sought to secure it they had all been working in the same groove and so that's the power of inspired work on

different on a different path realizing okay well everybody's running the same experiments they're working the same groove maybe let me attack this same problem and find a solution in a different manner and that's what he did um this is just faraday uh inspiring edison edison was a voracious and penetrating reader hungry for knowledge and possessing an amazing memory so it says edison had avidly consumed all three volumes of british scientist michael faraday's book and that book's called experimental researches in electricity and magnetism faraday became an immediate hero a poor lond London boy who rose to the top ranks of science on brains and hard work alone

to Edison Faraday had been living proof that the secrets of nature could be revealed through a determined experiment and astute observation beloved as Edison was by an odd and respected public his cocky ways and phenomenal early success had deeply irked his many scientific and inventing rivals especially the gentleman of academia so this is also uh you'll see westinghouse has to deal with this tesla definitely has to deal with this a lot of people did not like him belittling

their work understandably so um but I just wanted to bring this part because I had this, in so many of these episodes, I had this section that I tongue-in-cheekly called Critics Don't Know Shit. And it's not that saying that you should ignore all criticism. It's just that it is inevitable.

I don't think I can think of one example of the biographies that I've read and covered on the podcast where people at the very beginning told the entrepreneur, the founder, the inventor, no, it's not going to work. Oh, you're going to fail. Why are you doing this? Why are you trying to be different? It's just a part of human nature. Human nature does not change. This happened hundreds of years ago. It'll happen a hundred years in the future. And you're going to see this where you have what they just said. The gentleman of academia were like, Edison's a liar. Like, this is ridiculous. And so let me give you a quote. And this is just silly nonsense. And we know this is silly nonsense because we're living in the world that Edison helped partially birth. So this guy named, I'm not even going to say his name.

It doesn't matter. He scoffed in a public lecture. What a cocky, and I wrote, who is the cocky one? And you understand why I wrote that after you hear this sentence, he says. We have heard a great deal of late of Mr. Edison's discovery of a means of indefinitely dividing the light. I cannot tell you what his method may be, but I can tell you that any system depending on incandescence light will fail.

So how, like they're saying he's cocky, right? How cocky is it to say, I don't know what, how he's doing it or what even, what the details are, but I'm just going to make this pronouncement that nope, it's never, it's impossible. Like you just have no idea if it's impossible. So I bring that up because inevitably, whatever you're working on uh sometimes it's it's customers sometimes it's your own family sometimes it's friends sometimes it's strangers on the internet um you're gonna experience uh criticism it's just what humans do they just like to babble on about stuff they know nothing about and it's best for you to just ignore it i mean if there's some element of truth then listen but oh is that true and true? And if you find it to be true, then hopefully you can use that as helpful information that's actually useful criticism.

But if it's just some people saying, oh, no, this is impossible. I have no details. I haven't looked into it at all. I'm just talking. Then ignore them. Edison is telling, this is something I talk about a lot. I talk about this with friends and family that one of my favorite quotes is, action expresses priority. So your actions actually tell the world what is actually important to you.

There's a lot of people that say, oh, I want to start a business. I want to lose weight. I want to do X, Y, and Z. And then you look at their actions and it's like, oh, you don't actually want to do that. You're just playing. It's a fairy tale in your mind. So Edison is telling us with his actions what to do, and that's avoid distractions. Edison, who had always been easily available to any reporter looking for a story, now put off all requests.

Now what's taking place at this time is he's got the light bulb working, but he doesn't have the filament working. So he's like, all right, I'm avoiding distractions. I cannot entertain reporters like I normally do because I got to solve this problem. OK, so he's raised a little bit of money. Obviously these are hugely capital intensive businesses, but he's getting a lot of pushback. And this section made me think of a quote that I've been actually thinking about a lot lately. And it comes from the podcast I did on Jim Clark, founder of Silicon Graphics, Netscape, other companies. One of the craziest stories, if you haven, founder of Silicon Graphics, Netscape, other companies.

One of the craziest stories, if you haven't gone out and listened to it, go back and listen to it. Jim Clark, it's based on Michael Lewis's book, The New New Thing, A Silicon Valley Story. But he has a quote in there that I've been recently thinking about where at the time, Jim was like trying to raise more money and people were like waffling. I think, let's say he needed $20 million. I don't remember the exact number. But he's like, you know what? I'm not. They're like, oh, you know, they were trying to make some concessions or basically dilly dallying for lack of a better word. And Jim's like, you know what? Forget it. I'll put up the money myself. I'll do it. And then this inevitably resulted as kind of predictable. Then they became extremely

interested because then they had FOMO. They're like, oh, no, we're going to miss out. He's going to just do it himself. So we'll do it. And then the part that stuck out to me is what Jim said about it. He was raised in a small southern town in Texas. So he has like a really interesting way to think about things. And he says to do anything great, you need pigs and not chickens. Right. And this is one of my favorite metaphors. And Thomas Edison is experiencing the same thing. He needs pigs, not chickens. So it says, Jim Clark liked to say that human beings, when they took risks, fell into one of two types, pigs or chickens. And this is a quote from Jim. He says, the difference between these two kinds of people is the difference between the pig and the chicken in the ham and eggs breakfast.

The chicken is interested. The pig is committed. If you're going to do anything worth doing, you need a lot of pigs. So obviously the pig gave his life and the chicken just laid an egg. So we see an echo of that about 150 years early before Jim experienced the same thing. He says, this is now Edison talking. He says, we were confronted by a stupendous obstacle. Nowhere in the world could we attain any of the items or devices necessary for the exploration of the system.

The directors of the Edison Electric Light Company would not go into manufacturing. Thus, forced to the wall, I was forced to go into manufacturing myself. So you don't want to spend the money in manufacturing? Forget it, I'll do it. Since capital, listen to the words Edison uses here. Since capital is timid, I will raise and supply it. The issue is factories or death.

So Edison is a pig. He's committed. The people that have funded him up until this point are chickens. If you're going to do something great, you need pigs, not chickens. To show he was not kidding, Edison had boldly established a light bulb factory out at Menlo Park, which by the end of the year was turning out several hundred bulbs daily. This was controlled and financed by Edison himself, who sold electric stock and borrowed whenever he could.

So he's fully in. He's like, listen, if we don't do this, we die. So we have to do it. Oh, so this is something just crazy to me. This has really nothing to do with any of the three that we're studying today. But it was a reminder to me about that there's always always opportunities um for entrepreneurs that are always focused on improvement because there's a lot of uh problems in our life that there's like the adaptability of humans is one of the the greatest traits of our species right

but it could also lead to this point where like you just you settle for good enough like this is and if you focus on hey we don't have to focus on good enough we can actually always focus on improvement that's where there's a lot of opportunities to start new companies to products and new services right and one of this was i i thought about like i've been thinking about henry ford a lot lately because i just covered uh his book a few weeks ago and how much of an improvement uh the automobile was compared to how people got around on horses or with their own feet. So this is the main setting for the story we're talking about today is in New York City and Pittsburgh, right? But mainly New York City because that's where they started lighting up everything first.

And this is the environment that these people were living in in the 1800s in New York City. Working largely at night when the city's much maligned street cleaning crews spread out to remove the 2 to 3 million pounds of horse manure left behind each day by the city's 150,000 horses. So think about this. Before they mentioned the automobile, the primary way to get around the city was horses horse-drawn carriages and humans thought it was fine to have three million pounds of horse crap in the city streets every day people live like that they're like this is the best solution this is this is good enough and so i think for entrepreneurs always focus on improvement you realize that there's no such thing as good enough we can always improve and find up new new ways. And eventually, of course, like New York City does not have, or any other cities does not have 150,000 horses dropping a bunch of crap everywhere now. And that's because

entrepreneurs, tinkerers, inventors, experimenters found a better way to transport our bodies around. Moving on, some traits that I've obviously learned from Edison, among others, his patience and persistence overcomes all. He said for four years, now we've jumped ahead in the story, Edison had worked as hard as ever as he had on any one project. And he was understandably nervous that it would actually perform as promised. Edison was now 35 years old. And while his face still looked as useful as ever ever his brown hair had turned gray in the years since he had blithely and innocently promised to light up all of lower manhattan with his boat with his light bulb so think about that he he got a lot of initial traction after one week it took over four years to finally find the filament that's persistence um this is what

edison wanted or as i would say like everybody needs to know their why like why are you doing what you're doing like what is your why so this is edison's why before him the great inventor saw only more glory and great fortune which to edison translated into utter freedom to exercise his prodigious gifts as an inventor. He explained, my one ambition is to be able to work without regard to the expense. I want none of the rich man's usual toys. I want no horses or yachts. I have no time for them. What I want is the perfect workshop. And that is actually a belief held by a lot by, I would say, Edison, Tesla, and Westinghouse in fact I was just watching a talk Steve Jobs gave back in like the late 90s and he talked about how he was influenced by

Bill Hewlett and David Packard specifically the fact that they wrote down the principles of their company it's called the HP way I actually read that book and did a podcast on it. You can find it in the Founders Archive. But he talks about it. He's like, the first thing they said in the HP way is that we have to make a profit. That's the very first thing. They weren't. And they said they have to make a profit so they can go on building other products. And I like that as opposed to building a product to make a profit. It's like, no, no, we're going to make profits so we can make products that make the world better.

That's how Edison thought about it. That's how Tesla thought about it. That's how Westinghouse, Westinghouse winds up being a very wealthy man. He has like $50 million by the time he dies in early 1900 money. But he focused solely on like building products for the good of humanity. And I would argue that same thing with steve jobs like you can go and look at the house he lived in or like the fact that he i don't think he ever sold stock i know they borrow against it they do all the other stuff but um he wasn't

in it he had he was in it for the right reasons and that and to me the right reason is to build the best product possible now a byproduct of building the best product possible is you're going to have uh assuming you're running your business correctly, you're going to have profits. But what are you going to do with your profits? And for Edison, Tesla, Tesla winds up making a little bit of money too. And I'll get to that in a minute. It was always just so they could invent and make more products. I feel like there's a theme there that between Edison and Tesla and Westlinghouse and Hewlett and Packard and Jobs that I think is important to realize. It says, I mean, even think about what Jeff Bezos is doing.

He's taking, he's liquidating about a billion dollars a year in his Amazon stock and he's putting it into Blue Origin. He's, I mean, he could spend that billion dollars on all kinds of ridiculous uh consumption you know and he's like no i want like i've had a passion since i was five years old about space and rockets and i would i feel like that's my obligation to humanity all right so now we're going to go into tesla what a character this guy is uh nikola tesla was truly possessed by only one great passion, the mystery of all things electric. So let's see.

It says settled into a strenuous schedule that began at 5 a.m. So he's going to start working for Edison's company in France. Now this is his schedule. He's such an interesting person. So he settled into a strenuous schedule that began at 5 a.m. Every morning, regardless of the weather, Tesla explained,

I would go from where I resided to a bathing house on the river Seine. I don't know how to pronounce that. Plunge into the water, loop the circuit, which means swim laps, 27 times, and then walk an hour to reach the factory where the company was located.

It was a considerable coup for a young man whose whole soul resonated to the little-known mysteries of electricity. Here he was in the expanding Edison empire. So he starts working there. It quickly showed he was a reliable troubleshooter capable of solving most electrical tangles. However talented Tesla was as an engineer, he was also a decidedly odd fellow. So he's a misfit. What a surprise. Tesla was prey to strange habits and phobias. He silently counted each step he took as he made his early morning walk down to the factory. Every activity had to be divisible by three,

hence the 27 laps each morning. Before eating or drinking anything, he felt obliged to calculate its cubic contents. He deeply disliked shaking hands with anyone. He had a violent aversion against the earrings of women. Whoa. Pearls above all freaked him out that's weird i would not and then this is our tesla talking i would not touch the hair of other people except perhaps at the point of a revolver and the mere sight of a peach brought on a fever what uh this is tesla i was intended for my very birth for, for the clerical profession. And this thought constantly oppressed me. So he talks about why he left his native Serbia,

that, uh, he was very, his Serbian family was very, um, against his experimentation. Um, so it says,

this is Tesla in high school. Uh, this is more critics, obviously, um, Tesla, a prodigy in math and physics, felt even more deeply and irrevocably enthralled to the still nascent science

of electricity. He alarmed his professors with his voracious and exhausting appetite for work, especially if it had to do with electricity. It is impossible for me to convey an adequate idea of the intensity of feeling I experienced was experienced i experienced in

witnessing my physics teacher's exhibitions of these mysterious phenomenon so this is where he's falling in love with his life work and he started he worked on this up until he died in his 80s every impression produced a thousand echoes in my mind i wanted to know more of this wonderful force and i'm going to share a lot of quotes with you from Tesla. He's got a very poetic way of speaking. So he goes, this is important, though. So his teacher gives a demonstration of this thing called a gram machine. And Tesla, this is another example of like critics where Tesla realizes.

Well, let me just read this to you, actually. So let's see it says notice tesla this is that um there's here's a quote from tesla says sparking badly talking about the gram machine and i observed that it might be possible to operate a motor without these appliances meaning all these moving parts that they needed to to alternate to current but my professor declared it could not be done and did me the honor of delivering a lecture on the subject at the conclusion he remarked mr tesla may accomplish great things but he certainly will never do this it would be the equivalent of converting a steadily pulling force like that of gravity into a rotary effort it is a perpetual motion scheme an impossible idea and he's saying this in public like how why would you do that initially deeply embarrassed by such a public rebuke

tesla the dreamer could not resist however thinking about the pointlessness of the sparking community communicators i don't know what those things are uh he winds up actually accomplishing this very feat that his professor says is impossible. He winds up selling a variation of this idea to Westinghouse, which we'll cover later. And it took years and years and years. I'm skipping ahead in the book, but this is Tesla's response to solving a problem that he worked on for more than five years. And this is this is Tesla talking to his friend about it. He says, isn't it beautiful? Isn't it sublime?

Isn't it simple? I have solved the problem. Now I can die happy. Now keep in mind, he's a very young man. But I must live. I must return to work and build a motor so I can give it to the world. No more will men be slaves to hard tasks.

My motor will set them free. it will do the work of the world and what he's talking about the work he's talking about is is ac it's alternating current uh he's a he was integral in get and bring this new technology to life unfortunately um as we'll see later in the book like he never captured nearly, he dies basically penniless and he never captured the value that he actually provided to the world. He was not a good businessman, unfortunately. But I want to bring up that point because he actually dreamed, daydreamed, obviously it didn't happen all at once. He was thinking about this problem and working on it for many years, but he saw the solution in his mind. Then he says, I know, obviously it didn't happen all at once. He was thinking about this problem and working on it for many years, but he saw the solution

in his mind. Then he says, I have to build it. So that's what I mean. He's got a very, I've never come across a person like Nikola Tesla before. That's basically what I'm trying to say. Um, okay. So now we're, I'm just going to give you some early responses to electricity. Um, people were pessimistic about it and they called it like witchcraft.

This is one quote. We are not yet in the habit of observing machines that function without apparent cause. Remember, electricity is largely invisible, right? Their occult workings baffle us. The secret of their existence escapes us. The naive and enthusiastic Tesla was soon explaining his wonderful alternating current induction motor, that's what he was talking about, and full system to these new colleagues and bosses. This is happening at Essence Factory, but remember,

Edison is dedicated to direct current, assuming that they, of all people, would appreciate it. At a time when the understanding of electricity was still quite primitive, polyphase alternating current was a quantum leap and difficult to grasp. So that's what Tesla's working on. Tesla's exuberant and idealistic plan to liberate the world from drudgery was not at all obvious, even to those working in the field. What they knew and understood was direct current electricity where the electrons flowed only in one direction and created little magnetic field so tesla this is tesla creates a lot of enemies within the industry because like this is he's basically saying this is dumb there's a much

better way to do it direct currents it's not going to it's not going to last because it was limited you'd have to build a reason they started in New York City because you needed population density. So they build like the stations and each individual station could electrify houses and that are producing the power much closer to the actual fuel source. And that's how we do it today. You see the electrical lines either running on these wires in the road or they're buried underground, but they travel very long distances. And so Tesla's like, you're not going to be able to spread. And he framed it in idealistic terms. He's trying to free humans from drudgery. Liberation is what he constantly used. He's not going to be able to do that

over long distances under a current. You have to use my current. So this is surprising, but still true to this day. And also an insight into what it's like building a company in new industry. And this is a quote from one of Edison's managers. He says,

people generally did not at all appreciate the need or value of electricity. They had to be educated to its use. Suitable manufacturing methods as well as adequate ways of distributing the manufactured product had to be devised. So what they're saying is not only like you have to create the product,

but you have to create every single processes you need in this nascent industry, including distribution. Customers did not, and check this out. This is such a great quote. Customers did not exist. They had to be created. A litany of insufficient capital, shipments that needed to be sped. This is some of the problems that they're having in New York, laying on this electrical wire. So this is a litany of insufficient capital, shipments that needed to be speeded up, fickle clients of isolated plants, that's the recurrent plants, problematic and erratic machines, and poor quality supplies. Many of these difficulties were resolved fairly easily, but others were major embarrassments and threatened grave financial consequences. So, you know, every day they had more fires and more chaos to deal with.

This is Tesla on meeting Edison. He finally comes to America because he realizes like that's, if he's obsessed with electricity, that's where electricity is happening. He needs to go there. At the time, like I said, he was working at a factory of edison's factory in one of his in europe in france he says the meeting with edison was a memorable event in my life i was amazed at this wonderful man who without early advantages and scientific training had accomplished so much i had studied a dozen languages delved into literature and art and had spent my best years in libraries reading all sorts He's like, maybe I made a mistake. Maybe I didn't need to do this. Look what Edison's accomplishing. But he realizes, no, no, the fact that I spent all this time having a broad set of life experiences is actually better

because he was able to see the deficiencies in Edison's systems. But he says, but it did not take long before I recognized that that was the best thing I could have done, meaning constantly exposing himself and learning about new things. So this is, I left my note to myself. i don't know no one is always right no one is perfect let's see what that meant it says tesla pointed out that a central station based on alternating current dynamos could liberate there's that word again electricity from the one mile shackle of edison's dc plants moreover his ac induction motor would surely be superior to those operating on DC. Oh, this is what, now I understand my note. Edison, when Tesla's telling Edison this, Edison

responded very bluntly that he was not interested in alternating current. And then this is Edison being extremely wrong. This is what I meant about no one's perfect. There was no future to it, and anyone who dabbled in that field was wasting his time. And besides, it was a deadly current, whereas direct current was safe. So obviously Edison, we know because the world we live in is AC-powered that Edison was wrong. And these two do not— they don't mix well. Tesla and Edison are very much like oil and water. And Tesla leaves and he starts his own company and he says, Tesla lasted less than a year as Edison's employee in New York.

In truth, he and Edison were like oil and water, each amused and annoyed by the other. Far worse, believe Tesla, edison's approach to science there's a quote from now this is really interesting because there's multiple ways um to to uh to succeed in any complex endeavor right and so this is tesla saying that he doesn't like edison's approach he said if edison had a needle to find in a haystack he would proceed at once with the diligence of the bee to examine straw after straw until he found the object of his search. His method was inefficient in the extreme, for the immense ground had to be covered to get anything at all unless blind chance intervened. And Tesla suggests to us a different alternative. He says a little theory and calculation could have seemed to have 90% of his labor.

Edison, in turn, dismissed Tesla as a poet of science whose ideas were magnificent, but utterly impractical. So there's two very different people. And again, they're both very smart, make a lot of inventions, succeed at life, and take different approaches. Now I'm going to talk a little bit about the dramatic ups and downs of the life of Nikola Tesla.

And he says, I have lived through a year of terrible heartaches and bitter tears, my sufferings being intensified by material want. So he has no money at this time. He's starting his own company. Scraping by in the cold winter, Tesla was reduced many a day to working in a New York labor gang.

And he just has such a, I'm going to eventually cover a biography of just of his because his life is so interesting. Just a little bit I learned about it from this book. And so he's in this like labor New York gang and he's doing physical work. And then one of the people he's in this like labor New York gang and he's doing physical work. And then one of the people he's working with realizes this guy has like a hell of a mind behind. And so he he he sets up a meeting for a potential patron.

And he just does he does an experiment where he rotate. He he's like figures out how to to command the electromagnetic field and make— well, let me just read this. He placed the egg on the table, and to their astonishment, it stood on end. But when they found it was rapidly spinning, their stupefaction was complete. So he was very, like, a flair for the dramatic, and he would do these lectures or these experimentations, and that's where he wound up building most of his reputation to make him famous.

No sooner had they regained their composure than they delighted Tesla with their question, do you need any money? Of course he needs money. He has no money at the time. Nikola Tesla's life was taking another one of his dramatic turns. After the betrayal of his partners, his winter of pauperism, I skipped over a part. He started a company. They did a little bit

of financing and then they just steal stole all of his work and kicked him out uh nikola tesla was once again launched on his long deferred electrical dream and that electrical dream is to bring uh alternating current to the world finally he would be able to build the whole ac system he had dreamed of for so long okay so now we got to the part about George Westinghouse, and I just want to give you a little bit of background to him. All right, and this is the time he starts to realize, hey, I'm going to work in this industry as well. He says, by 1884, at just 37, he had already assembled a formidable empire and fortune in the freewheeling world of railroads, the most important and ruthless corporate force in America.

So he was already, before he started working in the field of electricity, he was already well-established and really successful entrepreneur. At the age of 22, he introduced his most momentum invention, a revolutionary air brake that allowed the engineers of a passenger train for the first time to quickly and safely stop all the cars. Westinghouse had had a struggle finding anyone willing to back this novel and expensive venture. And so far, far wiser when he finally did introduce his air brake, he staunchly refused to give the railroads licenses, saying only he would manufacture them in his small Pittsburgh work. So, one, I want to stop and tell you what the alternative was before he invented the air brake system. So, let's say there's something on the track, and at the time the train want to stop and tell you what the alternative was before he invented the air brake system. So let's say there's something on the track.

And at the time, the train had to stop. The engineer had to go back in every single car and brake it manually, one by one by one. And so the air brake system used compressed air to do that all at once. So the whole train would stop. So then the second part i think is really important to notice he's like um when he did introduce his airbrake uh he didn't sell licenses right he's saying that he is going to own them he will manufacture them right this reminded me so there's a lot of i've read two books on howard hugh books on Howard Hughes. Howard Hughes is one of the most famous people that ever lived. There's movies made about him. And all I could think of after

studying him is, there should be books written about his dad, not him. I mean, what he did in aviation was impressive and other things. Yeah. But like, one of the greatest business decisions of ever, one of the greatest strategic business moves of ever has got to be Howard Hughes Sr. when he founded Hughes Tool Company, one of the greatest strategic business moves of ever has got to be Howard Hughes Sr. when he founded Hughes Tool Company, which is the vehicle for which printed money, hundreds of millions, if not billions of dollars, and that his son controlled later on after Howard Hughes Sr. died, was he came up with a way to, he developed a drilling bit, right? That would enable oil speculators to drill deeper and to access hidden fields of oil, right? And they're like, oh, I want to buy it, I want to buy it.

He's like, no, no, no, you're not going to buy this from me. I'm going to own it. I'm going to lease it to you, which means you're going to pay me every month, right? And I'll service and do repairs. And what happened is his break-even happened really fast. I don't remember, let's say a month or two after. And so everything after that was pure profit. And Hughes Tool Company has got to be one of the most profitable companies that ever existed. It's got to be. I mean, he printed profits for like 40 years of astounding, just an astounding measure. uh westinghouse is doing the same thing here he's like no no i'm going to control this you're not going to manufacture

i'm going like i'm not going to sell you licenses i'm going to manufacture them i'm going to make them myself and i'm going to control that he says when how when westinghouse felt the railroads however powerful were treading on his turf he intervened forcefully threatening patent lawsuits usually in person um Having seen his first patents expropriated by the railroads, that this happened in his early, before the invention that he had before the air brakes, he got screwed over. So they took his patents and his first company consequently dwindled away. Westinghouse assumed a lifelong ferocity when it came to his products and patents. So you just learn from him.

He also discovered railroad signaling. So that's another business that he built. In 1881, he began buying up promising patents, most important ones that controlled electric circuits set off by trains, thereby activating signals. So they needed to know when trains are coming and to switch tracks or whatever the case was. By combining these with his own improvements and inventions, Westinghouse soon dominated this new field. He said the oil lamps used in the signaling system were problematic

and existing electric companies were unhelpful with solutions. So this is the genesis of the idea of, hmm, maybe I should get involved in this new industry. When Westinghouse surveyed the state of the electrical art as embodied by edison and his competitors it did not much excite him except as a sure way to develop a large enterprise so he saw an opportunity the physical and he saw the exact same thing that tesla saw he says the physical limitations of edison's direct current central station was more than evidence the future foretold

an insatiable demand for small direct current central stations serving mile square areas and individual isolated plant plants so he knew that there was going to be a lot of demand for edison's new system but eventually knew that he's going to run out because you can't it's there's america's largely rural at this time like you can't what was working in new york city in 1880 is not going to work for the vast majority, but it will with AC. And then this is Westinghouse's greatest advantage. And then we're going to contrast Edison and Westinghouse a little bit here too. So it says, this is a direct quote from Westinghouse.

My early greatest capital was the experience and skill acquired from the opportunity given me when I was young to work with all kinds of machinery coupled later with the lessons in that discipline to which a soldier is required to submit so he was um when he was a young boy he would he he was exposed also his family worked and build machines and so he was constantly tinkering as I was constantly obsessed to see how things worked and constantly improve it and at the same time the civil war is going on and he tries to go when he was like 15 years old he go he runs away tries to join the civil war he goes back because his parents aren't going to let him two years later i think maybe three years later maybe 16 or 7 maybe 17 or 18 at the time and he winds up serving and fighting for the North in the Civil War. And so his childhood was formed by these two twin factors,

this idea that I can make machines, I can create things that other people use, which is an extremely powerful idea, and he also had discipline instilled in him, the soldier's discipline, when you're fighting a war. So he combined these two into a career. He was very much a man to contend with, the founder of four successful companies. Unlike Edison, who preferred to use only his own patented work, Westinghouse already had long and reasonably happy experience

with purchasing other inventors' better ideas and improving them in his own shops. So that's his M.O. Westinghouse was nowhere near as famous as the flamboyant Edison. He usually refused requests for interviews and stories. And he explains why. Amos is the flamboyant Edison. He usually refused requests for interviews and stories. And he explains why. If my face becomes too familiar to the public, every bore or crazy schemer will insist on buttonholing me. So he wanted his privacy.

In private, however, he was intensely compelling, fort right, blunt, and often charismatic. He could charm the bird out of a tree. And now here's a story from one of his employees. And this is part of the reason I've come away from this book, very much admiring of Mr. Westinghouse. Why am I calling him Mr. Westinghouse? George, I'm calling by his first name. And definitely going to read his biography and turn into a future founders episode. And this is one of the reasons. So this is one of his employees talking. They're trying to like wheel. Let me give you some background here.

They're taking like equipment they need and supplies they need from one of his factories and moving it. And they're doing it by wheelbarrow. The wheelbarrow falls. There's like a runway. It's like cement. And the wheelbarrow falls off and into the mud and so everybody's like other uh employees are laughing and like just laughing at how helpless

this guy is right his employee and then mr wessinghouse sees what happens he says mr wessinghouse appeared in his long tail coat and hi-hat he removed his gloves took hold of the wheel and lifted it onto the slab he said said nothing. It made a lasting impression on me. Here was a boss whose first impulse was to help, to set things right, and at the same time to drive home a powerful but unspoken lesson. They were all working together from top to bottom. George Westinghouse, like Edison, thought money was important only as a form of stored energy to use as he wished in his work and expand his businesses. He was interested not in being rich but in helping the world. He strove incessantly to deliver better more reliable products but he had another goal also.

My ambition is to give as many persons as possible an opportunity to earn money by their own efforts he once explained and this has been the reason why I have tried to build up corporations, which are large employers of labor, and to pay living wages, larger even than other manufacturers pay, or that the open labor market necessitates. That is very Fordian. Very much. If you didn't tell me that was a quote by George Westinghouse, I could easily think that was a quote by Henry Ford, because all he focused on was service. And that's what Westinghouse is saying. He's like, listen, I want to make money, but I want to make money as a way to expand the amount of service that I give to other people. And that's the point of the

businesses that I'm creating. And I think like, why would he say that? And it's because missionaries believe. They have a deep belief in what they're doing, right? They're sacrificing their time, sometimes their safety, to spread the word of what they believe in, right? And I think it's really important to realize that that scales up and down. And, in fact, on an individual level, it only takes one person to really really believe in an idea and as long as that person is unrelenting and willing to not give up they can

motivate and and and gather other energy from those around them and push that idea forward and so this is what he does they invent the modern transformer the electrical transformer uh he says the opposition by all the electric and this is happening within his own company so the reason i should give you some background he he george is realizing exactly what tesla realized that ac is the future right and so but everybody in the in this early industry was trained in direct current so like no no just focus on what's already out there and it took westinghouse to have this unrelenting belief in AC. And he's like, even the opposition, he overcomes the opposition of his own company. So this is the opposition by all the electric part of the Westinghouse organization was such that it was

only Mr. George Westinghouse's personal will that put it through. No one besides Westinghouse understood the tremendous breakthrough represented by the AC transformer, a machine that could take high voltages that had traveled long distances and step them down for safe use in entire factories or homes, undeterred by the chorus of naysayers at his own company. So what do you believe in? What do you believe in so much that you're willing to dedicate and to say, no, no, I understand that you may not understand this, but let me explain to you why I believe this is true. I think it's a very important like to pause and really think about like, what am I working on? What am I doing? Do I have this deep belief? Because it's one of the rarest things in life to be able to work on something you truly, truly believe in. And I think as entrepreneurs, like, we are unbelievably, like, lucky to be able to do that. Most people don't do that. I was just

listening to Arnold Schwarzenegger talk. He talked about, like, the importance of making a full commitment in whatever you're doing in life, right? And so he's like, I don't know where he got the number, but he's like, 74% of all Americans hate the job that they have. And he's like, the reason they hate the job they have is because they're just accepting whatever job is available. They didn't actually sit down and think, what do I want to do in my life? What do I believe in? And for Arnold, he's like, I wanted, I made a full commitment to become Mr. Universe, the winning of the bodybuilding contest. And then when I was done with that, I made a full commitment to become a movie star, even though everybody told me, no, you're silly.

People can't even understand your accent, et cetera, et cetera. And then when he was done that, he said, I made a full commitment to being in politics. He said, I knew my why and I centered that. And everybody said, like, you can't even pronounce the state of the of the that you want to be governor of. He's like, it doesn't matter. Like, I made the full commitment. I believe this. He was a missionary in every single endeavor that he did. I don't know. I think that you see that with Westinghouse, you see with Tesla, you see with Edison, you see with all of them. It's extremely important to be, to make yourself aware of that and then spend some time thinking about like,

how does this apply to my own life? All right. So this is Edison on Westinghouse. And this is the beginning of the war of the currents. So Thomas Edison already has an successful DC company. And I say successful in like quotes, because they're these are capital intensive businesses, they have to take on high levels of financing high levels of debt. And there's all kinds of like, global financial panics that caused them to in some in many cases, like had to reorganize, raise more monies and go

bankrupt these are so they're successful in the sense that they're spreading the product but financially not not not so much thomas edison smoked his cigar and stewed deeply incensed to learn that the westinghouse electric company was invading the field of incandescent lighting westinghouse was altogether another matter meaning there's a lot of other people that like little companies that try to pop up and in some cases even infringe on Edison's patents. But he never had an adversary like of the same level quality of person as Westinghouse. She says Westinghouse and altogether another matter, a formidable rival with immense achievement and access to major capital. He was not a man to scoff at, deride, or dismiss.

The Pittsburgh industrialist was reputed to be a real fighter who, once decided, pursued a course of action full bore. In other words, he makes full commitments to what he's going to do. Whatever new project he launched, he was looking to be the best. Like Edison, he thoroughly enjoyed working in the noisy, dirty shops among his men, inquiring about the state of their projects and infusing everyone with his own zest. Here were the first angry rubblings in the coming hostilities that would become to known

as the War of the Electric Currents. Okay, so there's one thing that's very confusing, because once, at the very beginning, everybody, okay, DC makes sense, EC. Then once Westinghouse starts installing them, he grows extremely fast. People realize, oh, wait, this is like a better option. Edison was extremely stubborn. And he kind of ignored what was obvious. And I don't know why. It was confusing to me.

To the point where he even bought, there was like European companies that were developing AC motors and stuff at the same time and AC systems. And he even bought an option for one of their systems, but then he refused to use it. So he could have sold,

like he starts getting outsold later on by even though he had a headstart by Westinghouse's ac system and he just never did it and so like my question i wrote down myself was like why stay with the dc system given its location short cut shortcomings right um it says um one somebody worked this is a quote from somebody worked edison it says edison genuine genuinely feared that poorly designed and installed ac systems would impede the broad adoption of electric power. That's what his stated reason was.

One suspects a further cause, stubborn pride of authorship. Every aspect of the Edison DC system had been created from scratch by Edison or his colleagues. It is easy to imagine him balking and incorporating the inventions of others. So in other words, what the author is suggesting here is it's ego, right? And I think that's very important because all like the idea that you're going to accomplish something great without a deep-seated belief in yourself. It's just that's of course you have this deep belief in yourself. Now, sometimes it's called ego sometimes obviously they could be taken too far in this case i think edison definitely took it too far

um but i bring that up because it's inevitable that we all have these same blind spots in our life um and just realizing when you see i guess my point is like you can see it's a lot easier identify uh flaws and other people than it is in ourselves. And just knowing that, okay, that person has flaws. Undoubtedly, I have flaws. Where are they? What am I? What am I papering over? What am I ignoring? What is my ego not allowing me to see? Because it could cause dire financial in terms of business, like dire financial consequences for yourself. It definitely did for Edison. Edison would have been, I mean, he still did relatively well financially for himself. He has a lot of other inventions, other businesses. But he was the first one in the field.

He owned the freaking patent for the light bulb. If he had just gone with, and I don't want to step over my point, but I guess it's not like this is like a brand new. I mean, this happened 150 years ago, but he winds up like, gee, General Electric, that came, that was a forced merger, which I'll talk about later in the podcast, between Edison and another AC company. And it was forced by JP Morgan, actually. You know, General Electric is still around today, but, so he's going to be forced into doing something he doesn't want to do. But if he just adopted it earlier, like he could have, it was his for the taking. Imagine being at the very, very beginning of one of the most important industries ever created, ever. opportunity that once in a once in a thousand lifetime opportunity because of ego worrying about ego or authorship or having to incorporate because remember edison didn't look at himself

like an entrepreneur he looked at himself as an inventor so it's going to be hard for him to say like oh wait this person invented something better than i did now an entrepreneur if you were an entrepreneur you'd be like oh no i don't care like i'm that's a better option let me let me go and let me actually that's that's way better that's a better product let me adopt adapt to that um so it's it's frustrating there's a lot of parts in this book we're just like edison come on man um so this idea of uh businesses that create fud fear uncertainty and doubt uh against their competitors. Very common, very old tactic. This is Edison creating FUD against Westinghouse. He says, and he's trying to,

he hits on this idea that AC current is deadly, that you're going to kill everybody. He says, the quickest, most painless death can be accomplished by the use of electricity. And the most suitable apparatus for the purpose is the class of dynamo electric machine, whichploys air intermittent currents that's ac the most effective of those are known as alternating machines manufactured principally in this country by george westinghouse so he's he's directly attacking uh westinghouse here the passage of the current from these

machines through the human body even even by the slightest contacts, produces instantaneous death. That's a hell of a way to compete, huh? Saying if you use my competitor's product, you're going to die. He lashed out publicly, issuing what surely stands as America's longest and most splendid howl of corporate outrage, an 84-page Edison diatribe.

He basically wrote a book, a small book on this, and it was called Warning, all capital letters with an exclamation point. It served as the first official public salvo in the most unusual and caustic battles in American corporate history. Edison, with his DC system, was making his first open attack against Westinghouse and AC in the War of Electric Currents. While Edison and Westinghouse are competing, Tesla is inventing. As Nikola Tesla returned to his seat, the assembled electricians comprehended uneasily

and somewhat resentfully that a new titan had risen unbidden among them, eclipsing much of what they had done, making irrelevant many of their dearest labors. So this is what I was talking about earlier, how Tesla would do, or excuse me, Tesla would do these public displays of what he did. And the author called it earlier a quantum leap.

And that's making these AC motors without, I think they're called brushless AC electric dynamos, actually. But that's a way to simplify the motors needed to make AC travel long distances. And so this public demonstration becomes extremely famous. Everybody's reading about it in the the early electric industry like trade journals and so Westinghouse it does the opposite of what Edison does like oh this is genius this guy's has already invented something better than what my company has so he goes and buys it from Tesla and this is um this is tesla um describing to us uh what he thought of westinghouse it says tesla very much admired westinghouse qualities as a businessman he said once no

fiercer adversary than westinghouse could have been found when he was aroused an athlete in ordinary life he was transformed into a An athlete in ordinary life, he was transformed into a giant when confronted with difficulties which seem insurmountable. When others would give up in despair, he triumphs. Had he been transferred to another planet with everything against him, he would have worked out his salvation in my opinion the only man on this globe who could have taken my alternating system under the circumstances then existing and win the battle against prejudice and money and power so he's saying westinghouse was the only one so i wrote a note to myself be a wolf survive anywhere you were dropped because

think about what what tesla just told us about westinghouse he said had he been transferred to another planet with everything going against him he would have worked out a solution um so what i mean about being a wolf and surviving anywhere you drop i use podcasts a lot to learn about what i would consider like just completely different lives to my own right and so i listened to uh this this outdoor podcast uh by an author and podcaster and tv host named steve ranella it's called meat eater it's very fascinating because i know nothing about like the natural outdoors i don't hunt i don't know anything about like i just it's like a foreign world to me considering and it's so weird when i think about it because like

most of human um existence was much closer to like Steve Vanilla's existence than my own, right? Where I live in a city, you know, deal with the, like we have the internet, we have all this, like we just, we basically built our own world within our, the natural world, right? That's kind of separate from it. And so I wind up find like, and Steve is like a student of history. So he goes and talks about like how different species exist. And it's just, I find like, and Steve is like a student of history. So he goes and talks about like how different species exist. And it's just, I find his podcast fascinating because it's a world I'll never probably exist in. So I was listening to, and he interviews a lot of like, I guess the US government has a lot of like people working for them

that manage like wildlife populations and like the national parks and all this other stuff. So I was listening to one where they had to move around. They track and monitor how much of any given animal is in an area to make sure they don't go extinct, right? And what happens is they were talking about how they had to move. I don't remember the name. Let's just say it was an elk, right?

They had to move the elk population a couple hundred miles and you do that they have like a let's say a small group of like a hundred and you build this huge fenced in area right the fence is so big they can't even see the fence and eventually you keep uh removing parts of the fence so over months and months and months um eventually like you're easing them into it where like they you you relocate them to an area they have food and water and things they need to survive. And then eventually you remove pieces of the fence and they start expanding out.

And as they expand out, the population increases. And so then you have these pods of elks. I don't know what they're called, what groupings of elks are called. But in the environment they were just moved from, they're still growing. And now this new environment, they're're still growing so basically splitting them up and now that allows them to to create more right and so that was like interesting that they had to like

be so protective of them because there's so many things that hunt them and then steve or somebody else on the podcast says they're like oh you've done this with the wolf population and i'm in the american like northwest right and and you've moved them do you have to do the same he was asked question like do you have to do the same process where you like set up this huge uh fenced in area where there's food and everything else and the guy's response I'll never forget he's like no he's like you can drop wolves anywhere and they'll immediately start surviving like basically they're they're infinitely adaptable over hundreds of thousands, if not millions of years

to do what they're put on the planet to do. And I think there is an analogy there for entrepreneurs. I always talk about how I learned a lot from, like if you listen to the words of, I think like entrepreneurship and hip hop have a lot of like similarities. And there's this, Jay-Z has a line that came out like 15 years ago or 20 years ago that I always think about.

And he says, put me on any, uh, put me anywhere in God's green earth and I'll triple my worth. Meaning like he'll understand like how to identify opportunities. And he's basically saying, I'm like in that scenario, he's the wolf. It doesn't matter where you drop me. I'll figure it out and I'll thrive. I'll figure out what resources are me. I'll figure it out and I'll thrive. I'll figure out what resources are there. I'll figure out how to get what I need. I'll figure out how to combine those resources and to make them more valuable over time. And that's all you're really doing

when you're building a product or doing a business. So I think in this case, going back to Tesla's quote, had he been transferred to another planet with everything against him, he would have worked out his salvation. Be a wolf, survive anywhere you're dropped dropped westinghouse is going to survive anywhere you drop them okay um oh and westinghouse just has a lot of good personnel like personality traits that i want to um focus on so they're having this bitter battle they don't even know each other um

and westinghouse is like this is stupid so in the middle of war westinghouse just writes edison a personal letter so she said he wrote a personal note to thomas edison and he's like i want to propose peace here he says i believe there has been a systematic attempt on the part of some people to grow to do a great deal of mischief and create as great a difference as possible between the edison company and the westinghouse electric company where there ought to be an entirely different condition of affairs so they're like let's just talk this out we don't have to do this we don't have to like there's there's plenty of room for everybody in the business and I think Edison rebuffed him so it didn't work out but I I think like I think about

any time I've had like personal conflict um there's something very human when, let's say you have a fight with a friend or a business associate, anybody else, like, I think it gets really, it makes it a lot worse if you just stop talking or ignore it. And sometimes you have to take a step back, let time, like, get everybody to calm down. But almost every other time, you can just be like, listen, let's just sit down and talk about this, man. This is stupid. Let's figure out why we're having a problem and let's just come to some kind of solution. I think this personal touch is extremely important in human endeavors.

So next time you find yourself in conflict, once you, as long as you're not, you know, letting anger or emotion blow your judgment, just be like, let's sit down and talk calmly and I bet you we can figure this out. And in most cases, you can. And that's what Westinghouse is trying to do. Edison rebuffed him.

And part of the reason he probably rebuffed him is because AC was winning by a long shot. And here it says, Westinghouse emphasized his company's huge success. The 1888 Essen annual report showed central station orders totaling 44,000 lights. Okay? So they did 44,000 lights the whole year.

In October of 1888, his farm's orders was 48 000 lights so he did more in october than edison did an entire entire year and edison had a huge head start on him because again other people saw the same exact thing that tesla and westinghouse saw that the ac was going to be it was going to win out um edison does win a few battles. This war goes on for quite a bit of time. So it says, Edison could feel happy about the drop in copper prices. So light bulbs need copper at the time. And what he's talking about there is there was a small group of people try to corner the market on the world's copper prices and try to basically create a monopoly so they could jack up prices that affected edison for a little bit uh

and it didn't really affect westinghouse as much because ac required less uh lighting or less copper i don't know the exact details obviously i'm not well versed in and all the materials but that that was actually um that monopoly was penetrated and broken up and it was actually done by like, uh, market forces like scrap dealers or whatever the case was. But anyways, the price drops. So that's what they're talking about there. His clear cut light bulb patent win in the courts that happened over and over again. Um, and Tesla's humbling in the real world of making things work. So what they're talking about is Westinghouse bought Tesla's, uh, AC system, whatever you want to call it.

But after a year, he left Westinghouse because they couldn't make it work. He makes it work later on. They just couldn't at this point in the story. There was also the unexpected appearance of a new and powerful player. All through the war of electric currents, both Edison and Westinghouse were continually in the story. There was also the unexpected appearance of a new and powerful player. All through the war of electric currents, both Edison and Westinghouse were continually in the public eye, whether through their proxies or firsthand.

Notably absent from this very public fray was the other major AC company, the Thomas Houston Company. So the Thomas Houston Company winds up, it's run by, check this out, if you think about where you're at in life, hopefully you're working on things that you want to, but maybe like a lot of people,

you're in a spot where you're like, man, I know I could do better. The guy that runs Thomas Houston, you know what he did before he runs Thomas Houston? And remember, Thomas Houston merges, they went up growing 75% of the market into General Electric. He sold shoes.

He was a shoe salesman. My point being is like where you're at now is not indicative of where your life will always be. You are perfectly capable. You are human. You're an adaptable person. You can learn new skills. You can do whatever you want to do that you set your mind to. This guy went from selling shoes to running the largest electric company in the world. Come on, that's amazing. Edison, obviously, is going to be forced into merging with him. He doesn't like the guy. Westinghouse doesn't like him either.

But nonetheless, I thought the fact that he sold shoes before he started an electric company is quite inspiring. So there's this huge, really, a lot of the public relations battle in the War of the Corrants, according to this book, was really one-sided. Edison was really attacking Westinghouse. And Westinghouse is really smart. And he's like, this is a lesson, what we're going to focus on here, is don't play the other person's game. So Westinghouse hires this guy named Henrik, who's a former reporter. He's basically saying, hey, I need positive PR. I want positive PR. I don't want you going out attacking other people, okay? And so Henrik reads a story about the same thing.

They're attacking AC and Westinghouse, and Henrik is getting mad. So he runs up to Westinghouse. Or Henrik is getting mad. And Henrik runs up to Westinghouse, or Heinrichs is getting mad. And Heinrichs runs up to Westinghouse's office. He's pissed off. He's like, and he bursts in the door. He's like, can you believe this is happening? And this is Westinghouse saying, he's saying, he saw that Heinrichs was agitated and what he was clutching, the newspaper. The Pittsburgh industrialist cocked his great head and asked Heinrichs, well, what's the hurry? And then

Heinrichs says, don't you think we ought to say something against these slanders and false statements? Heinrichs would always remember how Westinghouse eyed him for a few seconds. Westinghouse smiled. Heinrichs, they tell me you're quite a whist player. Whist is like a, something like bridge, some kind of like game. Is that so? Heinrichs admitted a fondness. Well, then you know the meaning of the expression, don't play the other fellow's game. Heinrichs found this thought puzzling. What did this, what did the game whist have to do with Edison? Westinghouse explained. Now, seriously speaking, all this opposition to the alternating current is doing our business a great deal of good.

He's understanding there's no such thing as bad publicity. We are getting an invaluable amount of free advertising. As a practical commercial proposition, the alternating current system is so far superior to the direct current that there's really no comparison. By keeping up this agitation about the deadly alternating current, they are playing our game and we are taking the tricks. They hope that by their power, their influence, they can accomplish the rest of the march of progress. This, by the very laws of nature, cannot be done. As to the attacks made against me personally of course they hurt but my self-respect and conscience do not allow me to fight with such weapons meaning he knows that he's in the right

because i feel that my moral reputation and my business reputation are too well established to be hurt by such attacks by letting others do all the talking we shall make more friends in the end I mean, I don't know how you can come away from reading this book or listening to this podcast without a lot of respect for the mind and philosophy of George Westinghouse. So one of the ways that Edison decides to fight the war is by trying to get... At the time, New York State, it might be New Jersey, let's say it's New York, is saying, you know, we're going to outlaw.

They have the death penalty. They don't want to hang people anymore. So they're asking people to come up with different, like more humane ways of killing people. And they come up with the idea of the electric chair. And so Edison wanted to he he was he was um contacted as like an expert on electricity so he says oh yeah the perfect thing to kill people is westinghouse's machines and this is more uh evidence that there's no such

thing as bad publicity because they're using these machines now to kill people and he says despite edison's war against alternating current, the month of September in 1890, soon after the first botched electrocution, so they use the machine, they think the guy's dead after like 12 seconds. They pronounce him dead, and then he comes back to life. He was never really dead, obviously. And so they have to keep electrocuting him, and it was like a very gross and public spectacle, and it made news everywhere, right?

So that's what they mean by botched electrocution. At the exact same month this happened, there was a banner sales month for Westinghouse Electric Company. In four short years since this was established, total annual sales soared from $150,000 a year to more than $4 million. So he's clearly winning this war. Now, he's doing a lot of sales, but he has a lot of debt. These are capital-intensive businesses, like I said earlier. And so there's two or three great recessions, if not depressions, that happen during this time. And sometimes they start overseas and they spread to America. Sometimes they start in America and spread elsewhere, like many banking crises tend to do. And so at this point, he needs a lot of money to pay off all his debt because they're calling in loans because a lot of these banks are having runs on the banks and they need money to satisfy their depositors.

So this is another example that if you're going to do anything great, you need a lot of pigs, what I referenced earlier, Jim Clark's idea. And so he's trying to raise money the bankers are seeing an opportunity of weakness so they try to like they're like oh yeah we're gonna give you money but we want to make sure that your company is properly managed okay so this is uh this is westinghouse forcing them to change from being chickens to pigs the phrase properly managed reflected an ominous turn of events. But leaving Westinghouse cornered, one of the bankers saw an easy chance to gain partial control of this highly valuable industrial property. He said to his colleagues, Mr. Westinghouse wastes so much on experimentation, how ridiculous is that, and pays so liberally for whatever he wishes in way of service and patent rights, that we are taking a pretty large risk if we give him a free hand

with the fund he has asked us to raise. We ought to at least know what he is doing with our money. When the bankers demanded a voice in management, Westinghouse explained in a genuine and pleasant way that this was impossible. He had always run his own companies, they were flourishing but for this immediate need to pay off electric creditors, and he had no intention of being second guessed or told what to do the two sides went back and forth at some length until westinghouse said he must have an answer either they were providing a loan no strings attached or they were not so they said they won't to their astonishment instead of being staggered he rose with a smile remarking well thank god i know the worst at last. It was not Westinghouse, impetruble as ever, who was shaken, but the overreaching bankers.

Westinghouse told several jokes, bade the silent bankers good day, and left the room. They had just witnessed the disservantly famous Westinghouse courage. So he goes and he finds other financiers and he's like i my business is good you can look at the numbers we just raise a lot of debt like and obviously most businesses you shouldn't be doing that in the case of what they're actually inventing in this case it might probably it sounds to me uh had to be like there is no other way um and he winds up finding people he recapitalizes the company this This happens to him actually twice. And at the very end, like 25 years, 20 years in the future from where we're at now, maybe a little less, they wind up due successfully bankrupting the company and installing like a, I wouldn't say adult supervision

because the guy's like 50 years old at the time, but they do make him have management and then he winds up leaving the company. I'll talk more about that later. But before he recapitalizes, he also has to, he goes to Tesla. He's like, listen, I set up this agreement with you.

You get royalties. And this, Tesla basically gives up the royalties to save Westinghouse. And here's, You get royalties. Tesla basically gives up the royalties to save Westinghouse. I'm going to read to you the description of how this event happens. It's sad from Tesla's perspective because he didn't have a lot of money. Then he has this huge success, makes a little bit of money. This decision he's going to make right here is going to wind up costing him close to $20 million.

He needed that later in life. He did not have a good later life. So they're meeting. He says, elaborated upon the crisis and asked Tesla to repudiate his contract and forego his patent royalties. Tesla described this critical episode in his own life. Your decision, said Westinghouse, determines the fate of the Westinghouse company. Tesla says, suppose I should refuse to Westinghouse company. Tesla says, Westinghouse replies,

Westinghouse replies, I believe your polyphase system is the greatest discovery in the field the world? Westinghouse replies, I believe your polyphase system is the greatest discovery in the field of electricity, Westinghouse explained. It was my efforts to give it to the world that brought on the present difficulty, but I intend to continue no matter what happens to proceed with my original plans to put the country on an alternating current basis. Mr. Westinghouse said, Tesla, you have been my friend. You believed in me when others had no faith. You were brave enough to go ahead and pay me. When others lacked courage, you supported me when your own engineers lacked vision to see the big things ahead what you and I saw. You have

stood by me as a friend. The benefits that will come to civilization from my polyphage system mean more to me than the money involved. Mr. Westinghouse, you will save your company so you can develop my inventions. Here's your contract and here is my contract. I will tear both of them to pieces and you will no longer have any troubles for my royalties. Is that sufficient? That's a hell of a level of dedication

that Tesla had to bringing electricity to the world. I think our goal should be to work in an industry that excites us like electricity excited Tesla. Here's an example of that. Tesla understood that many branded him a visionary for his deep belief in time, that in time, energy would be easily extracted from the universe around us. He pointed out, we are whirling through endless space with an inconceivable speed. All around us, everything is spinning. Everything is moving. Everywhere is energy. He pointed out, store ever exhaustible that's an interesting way to describe it humanity will advance with giant strides the mere contemplation of those magnificent possibilities expands our minds strengthens our

hopes and fills our hearts with supreme delight with that tesla bowed modestly instead beaming as the audience rose to its feet and thunderously clapped in amazement at what they had just seen and heard so this is one of his world famous um demonstrations of new inventions that he was making at the time too um this is the beginning where edison is going to be starting to be forced uh to merge westinghouse determined quest for money continued thomas edison might well have been grained great pleasure from westinghouse financial woes were he not much in the same predicament. That's what I meant about

these are businesses that created unbelievable values to the world, but as far as profit at this point in time, not so much. The previous summer's reorganization, meaning they had to raise

payoff debt too, so they reorganized, was not after all such a great arrangement. So the Edison Electric Company is being, the president is this guy named Villard. He said, Villard was well aware reorganized was was not after all such a great arrangement so the edison electric company is being the president is this guy named villard he said villard was well aware from his previous efforts to merge edison's company with rival firms that thomas edison bristled at such talk the inventor had angrily dismissed the notion that mergers would solve any problems

as for merging with thomas houston that was absolute anathema. Edison had already denounced its men for having boldly appropriated and infringed every patent we use. Moreover, Edison fervently believed that were he to combine with any of his hated rivals, his inventive fertility would drive up. If you make the coalition, my usefulness as an inventor is gone. My services wouldn't be worth a penny. I can only invent under powerful incentive. No competition means no invention. But here's the problem with this. He doesn't want to merge, but he only held 10% of his own company's stock. Villard once again began secretly talking to Charles Coffin. This is the former shoe salesman whose business brilliance had steadily forged Thomas Houston into a major electrical power. So they continue talking.

Fillard goes to J.P. Morgan. J.P. Morgan was one of Edison's first financiers. And they do something here. I couldn't even imagine what this felt like. They're going to merge the company and they don't even tell Edison. They don't even tell him. They do it because they control everything, so they just do it.

And then he finds out secondhand. It says, And it was so that J.P. Morgan, whose house had been the first in New York to be wired for electricity by Edison, but a decade earlier, now erased Edison's name out of corporate existence without even the courtesy of a telegram

or a phone call to the great inventor. So what they mean by that is the new merged company is uh they dropped edison's name and they just call it general electric and they had to do this because obviously um i mean you didn't have to do it that way i think that's terrible it's just not good at all um like interpersonal human relations, I mean, but they had to do this because DC was getting its ass kicked. AC had won the war and Edison was refusing to give up. So now the combined company controls 75% of the market and they sell both DC and AC systems. And at this point, effectively, the war for electric current is over. AC has won. I do want to update. I'm going to tell you more individually

about the lives of Westinghouse, Edison, and Tesla after the end of the war, because obviously now it's just the beginning of a whole new industry. Everybody's kind of competing on the same, like they're offering similar products. Before I do that, I just want to remind you that my podcast has no ads. So if you want to support yourself and this podcast at the same time, please sign up for the Misfit Feed. You can find that link directly in the show notes below. You tap it within 10 to 20 seconds. You can access half of the podcasts I do for free, like this one, and half are reserved exclusively for Misfits.

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All right, so let's talk about Westinghouse after the war. And this is somebody that worked for him. And it says, I have never met a human being who could keep track and direct as many things simultaneously as him. He had a farsightedness that it was almost uncanny to me every new idea was almost immediately analyzed by him and acted upon when you real before you realize what was in his mind as westinghouse

traveled relentlessly among his many businesses he continued his lifelong practice of seeking out brilliant inventors or engineers buying their their patents, and then collaborating with them to create better industrial versions. So that's kind of his MO about how he started all his companies. When he was younger, he'd invented himself, and then later on, he would just partner with them. It's just some philosophy on life,

just some random things, little nuggets of wisdom I think we can learn from Westinghouse and apply to our own lives. And they're saying, how can you go to sleep after such a busy day? And he goes, I never think of the past. I go to sleep thinking only of what I'm going to do tomorrow. With this constant forward thinking, Westinghouse squandered no mental energy on what might have been.

So this is the part of the story where there's another financial panic. This is in the early 1900s now, and this is where he's going to lose his company. And I just want to read the part, like how he responds to it. It's again, there's a lot of things in life that are, that are going to happen to us.

So most of which are not out of our, or most of which are not under our control, but we can control how we, we, we react to this. And he's having this conversation when this really sad and unnerving day, and he's talking to that Heinrichs guy,

the guy that was doing his PR, and he wants to get the word out to the press about what's going on. And this is Westinghouse. He says, Do not forget to make it very emphatic to them that this receivership is not the end of the company. The company is fundamentally as sound and solid as ever.

At the time, they're doing like, I don't know, like 30 million in revenue. They just have a lot of debt. The company is fundamentally as sound and solid as ever, and it will emerge out of this unfortunate situation a greater and more prosperous concern than ever. He's actually right about that. The bankruptcy was a great shock to both insiders and outsiders. but with money so tight, Westinghouse sold no alternative. He treated it as matter of factly. I grant to you, and this is the part I want you to remember and internalize for your own life. I grant you this is not pleasant, he told one friend, but it isn't the biggest thing in the world. All large businesses, I would say all businesses, has its ups and downs.

This sentence is super important. The crisis through which we are passing is only part of our day's work. It's remaining calm and realizing, hey, there's going to be ups and downs, and I just got to work my way through it. So they bring in this other guy named Robert Mather. They wind up pushing him off the board entirely, but then they want him to come back. And he says,

they made various lukewarm overtures to bring the great industrialists back into some kind of active management, but he disagreed with their whole corporate philosophy. This is another thing I think we can learn from him. He saw himself as interested in progress and profits and the welfare of his men while they were only interested in profits.

The loss of his electric company was a cruel blow, but Westinghouse was at heart an optimist, a doer, and a builder. He still had his four other major American companies and his insatiable desire to improve the world, and he was an entrepreneur till the day he died at a time when many americans had had come to view the nation's industrialists and financiers as little better than robber barons westinghouse was a notable exception this is how he was viewed an honest industrialist who sold the best product for the best price who relished competition and valued his workers and who deserved his hard-earned fortune. So when he dies, he winds up having like thousands of his employees coming out and to his funeral. And I think this is just an important thing that he, one lesson he taught everybody in this time, he says, a corporation can have a soul. And this is the last quote from Westinghouse in the book.

And he says, one day, one day towards the end of his life he was on a train whose air brakes helped avert a derailment at a bad track washout so he turns to the person next to him he says if someday they say of me that with my work i've contributed something to the welfare and happiness of my fellow men i shall be satisfied so i love that that's that's the like the the northern lady um the north star rather that guided him was like i just want to contribute something to the welfare and happiness of my fellow men and of course capture some of that um edison edison was distraught after after general electric reform he said you know what i'm just gonna i'm gonna work on something so big that they'll forget that i was ever associated with the electric industry.

Winds up spending years and a lot of money on this failed iron ore business. But he goes on and creates, surprisingly, the movie business. So Edison had to set up a primitive movie business. It says Edison had set up a primitive movie studio. And by 1904, with the Edison studios, they made a movie called The Great Train Robbery. Did early movies begin to move beyond skits to real stories? This was a revelation soon copied by others flocking to the business. And there's all these other machines and inventions that were basically in the early motion picture industry.

And he went to consolidating this. He says he had a bunch of, as came to be like standard for the industries Edison operated, was he had a lot of patent wars, but he wins. Like he won the light bulb patent war. Long drawn out patent wars, he emerged triumphant as a holder

of the key motion picture patents in 1907. So he sets up this thing called the Motion Picture patents company which was essentially a movie trust it guaranteed fees worth a million dollars a year to edison how crazy is that when one former colleague expressed concern to edison about his financial status he wrote back cheerfully my three companies the phonograph works the national phonograph company and the edison manufacturing company which makes motion pictures and machines and films are making a great amount of money, which gives me a large income. So as he turned 60, Edison was flourishing.

While Westinghouse had become a great industrialist, building even bigger and heavier machines, Edison was almost unwittingly developing a whole other sector of the American economy, one that was far less capital intensive and far more glamorous. The entertainment industry. So it wasn't working out for him in the end. He didn't get nearly what he wanted out of the electrical industry, but he took that, didn't give up, and kept going.

Tesla, unfortunately, did, you know, I would say worse out of both both Westinghouse and Edison. And this is a little bit about Tesla. His dreams were big, far beyond the imaginings of his peers, and very expensive. Tesla's idealistic and generous renunciation of his AC royalties was beginning to haunt him.

At $2.50 per horsepower, one can quickly calculate that Tesla had nobly forfeited a princely and heartbreaking sum of $17.5 million in royalties. And that's just the American induction motors. At that time, they've generated 7 million horsepower that he gave up. So he would have made more than that, assuming he would have got the patents in Europe as well. And I'll close on this. To this day, Nikola Tesla remains a brilliant but enigmatic figure, a scientist, inventor, dreamer, and visionary.

He did find patrons later in his life. He was allowed to live in, like, he lived the rest of his life in New York City, lived in hotels and whatever the case was, but he did not have a lot of money. Electricity had, so it says, to this day, he remains a brilliant but enigmatic figure, a scientist, inventor, dreamer, and visionary. Electricity had created many, many millionaires, but Tesla, who made possible the electric age, was never one of them. Still, he did live to see his AC system straddle the globe, illuminating nation after nation, and powering millions of motors. Almost 60 years after he had stepped ashore in New York, dreaming a big dream of electrifying the world. The dream had more than come to pass.

I will leave the story here. As you can see from the length of this podcast, I had a lot of notes. I really, really enjoyed this book. When it was over, I felt like I always talk about that feeling. You know when you get to the end of a great book, there's this weird, melancholic, I don't know even the name of the feeling. It's like you're very satisfied you got to the end, but very sad at the same time that it ended.

I really think Jill, it's spelled J-O-N-N-E-S. I'm pronouncing it Jones. I have no idea if that's how you pronounce it. But if you want the rest of the story, here's how you can support the author, yourself, and the podcast simultaneously. I leave a link in the show notes for every book that I cover. You click that link. It's an Amazon affiliate link. If you click that link and buy the book using that link, Amazon sends me a small percentage of the sale at no additional cost to you. It's a great way to support the author who did an unbelievable lot of

work that we can learn a lot from. Support yourself by reading a great book. There's very few better uses of your time than, especially if you're obsessed with entrepreneurship like I am, and like millions and millions of people all over the globe. Hard to find, other than outside of your own work, a better use of your time than reading about entrepreneurs over the globe. Hard to find, other than outside of your own work, a better use of your time than reading about entrepreneurs of the past, learning from their mistakes, stealing their good ideas, which in some cases took 70 years for them to figure out, and you also support the podcast at the time. So it's a win-win-win, and you'll just get a fantastic story. You can click that link, or you can just go to amazon.com forward slash shop,

forward slash Founders Podcast. You will see not only this book, but every single other book that I've ever reviewed for this podcast. And if you go to there, you'll see which book I'm working on. It's like a way to have a sneak preview to see what next week's podcast is about.

I usually post that and put it on the list a week in advance. What else? Oh, Misfit Feed. If you're ready to take it to the next level, if you're serious about studying, doing the same thing

that Thomas Edison did, doing the same thing that Steve Jobs, Jeff Bezos, Elon Musk, literally almost everything, I would say every single entrepreneur that we've covered, if you're ready to do what they've done and what they showed you with their actions,

they thought was a good idea, which is continue to study entrepreneurs that came before you. More importantly, learn from entrepreneurs that came before you. You're missing out. You're missing half of the episodes that I've done by not signing up for the Misfit feed. So the value that you'll get is incalculable. The value of ideas that people spent their entire lives figuring out that you can then just download into your brain and very quickly. It's worth, who knows what these ideas will be worth over your lifetime as you continue to dedicate your time and effort into whatever you're working on, whatever craft that you're pursuing. So please support. Again, that's another thing where you're supporting yourself. You're supporting me and allowing me to spend all the time that it takes

to make these. And I still, you know, I don't know if there's another podcast on the planet that's coming out on a weekly basis that prepares more than I do. You know, having to read hundreds of pages, taking notes, going back and looking and trying to make something that one, that hopefully you find entertaining, but you know, cause I think do entertainment is the, is the way it's like the Trojan horse, make this entertaining. And at the same time, you'll learn a lot. So please, if you've learned from, from my work and you value my work, consider doing that. And I would really greatly appreciate it. So you know where to get the books.

You know where to get the Misfit Feed. I mentioned earlier, if you leave a review, how to do that. Oh, and if you want, I'll leave a link. I take a lot of notes on talks by entrepreneurs. So if you want to, like, I'll leave the link. I'm just going to leave the link for the Jeff Bezos one because because his ideas on comparing and contrasting the internet industry with the electrical industry i think it's important especially because we are in the very beginning of this internet revolution that we're living through that's affecting all areas of our life and jeff is one of the smartest

people i've ever come across and he just the way he thinks about things and and his presentation was just fantastic i not only read my, but I'll link to the whole, in the notes, I link to the whole talk. And it's worth the 18 or 20 minutes it takes to watch it. So please tell your friends about the podcast. Thank you very much for listening. Thank you very much for your support.

And I'll be back next week with another biography about an entrepreneur.