Tony Fadell Wants to Disrupt Silicon Valley

With his firm Future Shape, the creator of the iPod and the iPhone seeks to dethrone tech’s giants.

It’s a crisp January morning in Paris’s 13th Arrondissement, and outside Station F, the former freight terminal that is the epicenter of France’s startup scene, twentysomethings climb out of cars hailed using iPhone apps. They approach the huge, glass-fronted concrete arches, heads bowed over screens, thumbs dancing out social media updates, pristine white earphones poking out from under beanies or from behind shoulder-length hair. The gates are activated by QR code, so they hold out their iPhones to get into work, where they’re probably building iPhone apps themselves, to connect our homes, cars, everything, to the device in our pocket.

This is the world that Tony Fadell helped build. Fadell is known in Silicon Valley as the father of the iPod, which, with its iconic wheel and those classic white earbuds, helped transform Apple’s fortunes from a struggling computer manufacturer to the most valuable public company in history. He played a central role in the creation of the iPhone, helping Steve Jobs and Jony Ive usher in the smartphone age. After leaving Apple, in 2010, Fadell founded the smart-home company Nest, which Google bought in 2014 for $3.2 billion. Few have played bigger roles in shaping today’s technological landscape. No iPod, no iPhone. No iPhone, no Instagram, Snapchat, Uber, or Pokémon Go.

But lately Fadell, like many in Silicon Valley, has been reconsidering the changes he and  his colleagues have brought about. In recent months, several former engineers and executives from Google and Facebook—including the inventor of the “like” button—have spoken out publicly about the dangers of smartphones, in particular the design of apps that are intentionally addictive. In June 2017, Fadell told an audience at London’s Design Museum, “I wake up in cold sweats every so often thinking, What did we bring to the world?” This January, after two of the largest investors in Apple called on the company to take action against smartphone addiction in children, Fadell joined in, publicly urging both his former employers to do more.

Photo: Céline Clanet

When I meet him two weeks later, the subject is still on Fadell’s mind. To be clear: He doesn’t blame Apple—“We can’t say all iPhones are bad”—or even social media companies, although he admits there are “what some people judge as bad actors out there.” Instead, he believes that today’s shocks are a symptom of society reckoning with an unprecedented technological change.

We’re sitting on a bright yellow sofa in Station F, where he has set up his own investment firm, Future Shape. At 48, he is a lean, energetic presence, wearing a teal V-neck, cords, and black zip-up boots. “My first son was born three weeks before the iPhone was released, so my kids have never known a world without them,” Fadell says. He believes Silicon Valley’s current crisis of conscience can be traced back in part to the architects of the mobile age having children and seeing the impact of their creations. “Your worldview changes dramatically when you have your first kid. You change from ‘me, me, me’ to family and community.” Fadell has three children and, although two of them have smartphones, the family imposes time limits, “screen-free Sundays,” and parental controls.

“When I think about digital well-being, I go back to packaged and mass-produced foods,” he says. “We have created a nomenclature around fats, sugars, proteins. What is obesity? What is bulimia?” Like food, Fadell argues, apps should be subject to their own health classifications. But our smartphones, he says, are just refrigerators. “They’re not going to cause you to be an addict or not. But they always stock themselves, and will give you the ability to buy anything you want.”

Photo: Céline Clanet

The first time Fadell tried to create the iPhone, it was 15 years too early. Born in Detroit, Fadell picked up engineering from his grandfather, a lifelong tinkerer who helped Fadell buy his first computer. Fadell showed a prodigious talent for computing; in college, he even sold a new microprocessor design for the Apple II to Apple itself.

After graduation, Fadell joined General Magic, a now-storied Silicon Valley company (alumni include eBay founder Pierre Omidyar and Android creator Andy Rubin) that was working on an early personal communications device. “We had email, we had downloadable games, downloadable apps, we had shopping, we had books,” Fadell recalls—in other words, the key features of today’s smartphones. General Magic built two devices, for Sony and Motorola, but neither took off, and the company folded. “It was too soon,” says Fadell.

Shortly afterwards, Philips appointed Fadell, then just 25, as its chief technology officer. It was at Philips that Fadell started thinking about digital music. “He had a vision for music being liberated from CD players—how music and portability could be reinvented,” recalls the designer Yves Béhar. The pair sketched out ideas for a portable MP3 player.

In 1999, Fadell formed his own company, Fuse Systems, to build it. However, as the dotcom bubble burst, the company struggled to raise money. Then, in 2001, Fadell was approached by Apple to consult on the design of an MP3 player—what would become the iPod. Steve Jobs hired him to run the new division.

Photos: Céline Clanet
Photo: Céline Clanet

Today, it’s easy to forget the iPod’s significance. “When I started, [Apple] had $25 million in the bank and $500 million in debt,” says Fadell. The iPod, with its navigation wheel and crisp white aesthetic, was far superior to anything on the market. But it wasn’t an instant success. “Steve was always saying the iPod’s going to help us sell more Macs, so the iPod can only work on the Mac,” says Fadell. Infuriated, he lead a skunkworks effort to make a PC-compatible version. “[Steve] said, ‘Over my dead body.’” It was only after Jobs relented that the iPod exploded, selling by the hundreds of millions. Mac sales also began to take off. “It was the gateway drug.”

When Jobs decided to build the iPhone, he initially appointed two separate teams to develop it. One, headed by Fadell, worked on integrating phone functions into the iPod’s click wheel design. The other, lead by then head of software Scott Forstall, attempted to slim down the Mac’s operating system to work on a touchscreen. Ultimately, the latter won out, but given Fadell’s experience with the iPod, he was brought in to oversee the hardware development. Inside Apple, Fadell had a reputation for being a troublemaker. He’d argue fiercely with Jobs, and occasionally quit or get himself fired. “His aggressive, combative style is what endeared him to Steve,” says David Bell, a friend who then worked for an Apple semiconductor supplier. “[But] he would sometimes be too argumentative, and that would piss people off.”

The Nest Nest Protect 2nd Generation and the Nest Learning Thermostat 3rd Generation. Courtesy Nest

When Google bought Nest, in 2014, Fadell’s style caused conflict again, and although the products racked up design awards, the connected home didn’t take off as expected. (Fadell disputes this saying, “Nest revenues grew 80 to 100 percent every year since inception—quite difficult to achieve for a hardware startup.”) After Google restructured in 2015, becoming Alphabet, Nest came under financial pressure. “When Google decided they wanted to sell Nest, I said, ‘Fine, I’m not staying,’” Fadell says. Alphabet reportedly tried to sell Nest in 2016, but failed to find a buyer. (Fadell contests this as well, saying “Google did have an offer for Nest, but decided not to sell.”) This February, Nest was rolled into Google’s hardware team.

In Paris, we talked about what Fadell has learned about mentorship. “When someone works for me, they say, ‘Tony pushed me harder than I ever was, and it was frustrating, but I did work that I never thought I’d do,’” he says. “That’s what people did for me. They pushed me when I wasn’t thinking properly, when I was being an idiot.”

“It’s difficult. You’re not always loved, and you’re not always liked.”

Recently, he’s started taking meetings in museums. “Steve Jobs and I would go on walks. You’d just walk and talk, and get to know somebody,” he says. In museums, “you get to be inspired, and also get to know the person. How do they think about that art? Can they look at things and think differently?”

He likes the notions of artists having creative periods. I ask if, after Nest, his own entrepreneurial period is over. “Maybe there’s something that pops up that’s like, ‘I have to do it,’” he says. “I’ve been close. But everything takes time.”

The Ressence e-Crown watch and app. Courtesy Ressence

When Fadell stepped back from Apple in 2009, the family went traveling. They fell in love with Paris; the city suits Fadell, who has a taste for European culture and design. They moved back to the Bay Area when Fadell was working on Nest, but when he quit Google in 2016 the Fadells moved to France for good, buying an apartment in the Seventh Arrondissement, and enrolling their children in school.

Station F might be downtown Paris, but it feels very Silicon Valley. It’s midmorning, and young startup workers are playing foosball over cappuccinos. There’s there’s a “Creative Zone” complete with craft supplies; food trucks linger outside. Funded by the French telecommunications billionaire Xavier Niel, it’s vast, with space for a thousand companies. Facebook, Microsoft, and LVMH have already moved in. France’s high taxes and red tape have previously been seen as inimical to startups, but that’s changing: President Macron toured Station F last summer, and the government even has an office here.

Future Shape was still settling in when I visited. The space wasn’t much to look at: a few tasteful chairs and a conference table in a glass-fronted former shipping container. Fadell had ordered a clock—it currently hangs in London’s Ham Yard Hotel—but it hadn’t arrived yet.

Fadell began investing nearly a decade ago (he won’t reveal his personal wealth, but given Apple stock and Nest’s sale, it’s likely substantial) and has stakes in around 200 companies. They range from OpenROV, a manufacturer of underwater drones, to Grenoble-based Aryballe, which develops biosensors to detect smells and tastes, and Karius, a medical startup that claims to be able to diagnose more than 1,000 infectious diseases from a single blood test. “We get to put ourselves in two hundred different scenarios—in agriculture technology, food technology, financial technology, pharma, and drugs. For me, that kind of stuff is oxygen,” Fadell says.  

Photo: Céline Clanet

Living in Paris has also given him time to work on personal projects, such as Ressence, the Brussels-based luxury watch brand, which has won acclaim for its blend of traditional craft and modern technology. Fadell, a watch collector, met its founder, Benoît Mintiens, after buying a Ressence Type 3, which has an innovative oil-filled display. (He’d explored similar approaches when developing touchscreens at General Magic.)

The week before we met, at the 2018 Salon International de la Haute Horlogerie watch fair in Geneva, Ressence unveiled the “E-crown”—a mechanical movement that connects to a smartphone to regulate its own time, meaning it never requires winding. It’s being acclaimed as a breakthrough timepiece. Fadell consulted on its design. “The whole magic was, how do you make a better mechanical watch, not [just] a smartwatch?” Fadell says.

“We look at products in a similar way,” says Mintiens. “Tony is someone who is putting the user in the center. In the end, with watches, it’s about: How efficiently do you express time?”

For Fadell, user experience is everything. “If we look at the major Cambrian explosions of digital technology, it’s always come from a disruptive combination of cutting-edge technology with cutting-edge user experience,” Fadell says. Every detail should be intuitive and create delight from the moment of unboxing; it was this, he says, that drove Jobs to create Apple Stores and ship iPhones with pre-charged batteries. “When you get that experience right, you put that device in somebody’s hand and they go, ‘Wow.’”

Trident, OpenROV's underwater drone. Courtesy OpenROV

Today’s technology landscape is very different than when Fadell started. Apple, Google, Amazon, and Facebook loom above everything, with near-infinite reach and financial capital, buying every promising startup—as Fadell himself experienced. I ask if it’s possible that the next big breakthrough could come from outside those companies.

“[If we thought] that you can’t unseat giants, we would have never made the iPod,” says Fadell.  “When we were doing that first iPod, I said ‘Steve, Sony is the number one in the world. They own every single audio category. How are we going to beat them?’ And he goes, ‘We will beat Sony. Watch me. If you guys build this, we’re going to put every single marketing dollar behind it.’ And where is Sony in audio today? Where is Nokia?”

His focus on “deep tech” companies at Future Shape—the portfolio includes new types of transistors and microscopic LEDs—is intentional, he says. “I’m doing the things that I know can unseat the big guys. If we get [the technology] right, we can build product companies around it.”

One area that particularly excites him is biotechnology. “Computational synthetic biology is a whole new world,” he says. “We can literally write code, like you would write code for a computer, synthesize it in DNA. We are at the cusp of making biological computers.” Future Shape’s investments include Impossible Burger, which makes lab-grown meat substitutes, and Modern Meadow, which has created a lab-grown leather alternative. “He’s been more than an investor,” says the latter’s founder, Andras Forgacs. “Tony really understands where design and technology come together to create great consumer products. That is not common among investors.”

Fadell is skeptical about the current hype around autonomous vehicles. “The self-driving cars world is making lots of progress, but there’s so much more to do. People don’t understand: They don’t work in certain weather, they don’t work in certain times of day, they don’t work in a fog.”

Robotics and artificial intelligence, Fadell thinks, are also further off than most people think. “We are so far away from being able to create real humanoid kinds of robots,” he says. “These robots are so fragile. And we’re not even talking about intelligence. We’re just talking about grasping and picking up and and walking.”

“The one thing I learned, especially from my General Magic experience, is sometimes the technology is not there, and sometimes society is not there yet.”

Photo: Céline Clanet

Fadell is starting to think about the generation that will succeed him. In 2015, Fadell cofounded an electric go-kart company, Actev Motors, with David Bell. “I said: ‘What was the experience that I had that was formative for me?’ And that was being in a workshop with my grandfather, fixing things, building the soapbox derby racer, and learning about different technologies.”

Actev’s go-kart is designed to be taken apart and modified: Parents can set speed and safety limits, while kids learn about electronics and basic coding skills. “It gives kids some opportunity to do ‘do it yourself,’” says Bell. “It’s really a modern version of what he and his grandfather would do.”

I ask Fadell about one of the tech industry’s growing problems, planned obsolescence: the relentless cycle of waste driven by constant product updates. Apple has recently been the subject of global furor and ongoing lawsuits after it was revealed that the company intentionally limits the performance of older phones, supposedly to protect battery performance. “Everyone went really crazy with the iPod because it [had] a sealed battery,” he recalls. Today, he worries about the environmental impacts of devices. “Reuse is really important. We have limited resources on this planet. That was the reason for Nest,” he says, noting that the company’s products are designed to last decades.

Increasingly, Fadell thinks the next generation of technology designers should commit to a kind of Hippocratic oath: first, do no harm. He has lobbied Apple and Google to introduce a “digital scale” function, to help us track our smartphone habits. “They’re tracking our physical well-being. Why don’t we have the same thing for our digital life?” At Future Shape, he’s pushing founders to think about impact early. “What is the purpose? How does it affect society?”

Fadell remains optimistic about the future. He often thinks back to his childhood in Detroit, building racers and taking apart radios with his grandfather. “What my grandfather would tell me is, ‘If a human made this—and they did—you can fix it,’” he says, his eyes shining. “‘And you can make it better, too.’”


Editor’s note: After the publication of this story, we heard from Fadell in regards several particular points. We felt it important, for clarification and balance, to share his response. It is below.

[I’m] tired of the iPod-dial versus Mac-touchscreen battle myth: First off, there was one iPhone hardware team and three iPhone software teams—one for the Apps, one for the Operating System, and another for making all the hardware, such as the cellphone, Wi-Fi, camera, battery, etc., work properly. None of them were competing teams, because they all had to work together seamlessly to create the original iPhone.

The [user interface] question was one of hundreds, even thousands, of decisions we debated. Like most any other design process in this space, it was an iterative process that required getting the hardware right at the same time as the software. On the UI, at the broadest level, we tried adding a phone to the existing iPod using the click-wheel. But we quickly learned it was cumbersome to dial a phone number like an old rotary phone. We also created an iPod with a full screen, to watch iTunes videos. We kept a lot of the original iPod UX in place, but replaced the beloved click-wheel with a single touchscreen on top of the familiar iPod interface—it, too, didn’t feel right. We also investigated a multitouch touchscreen approach that was also being investigated on a Macbook with MacOS, but treating this smaller screen like a desktop was too finicky, and [it was] heavyweight. All of these learnings ultimately lead us to the first iPhone, which took bits of hardware from each of those prototypes, [and] combined them with a highly revised MacOS using an entirely new UI that was paired with the iPod lower-level software [and] all-new Apps.

On [Scott] Forstall, yes, it’s well known that he and I didn’t get along. He didn’t get along with a lot of people. But it’s not accurate to conflate the iPhone design process with those disagreements.”

Back to List