AOL: Steve Case

When Steve Case started out in the tech business in the mid-80s, the idea of the internet — as we think of it today — didn't exist. But with AOL, Case saw an opportunity to connect millions of people, through chat rooms, news updates, and the iconic greeting, "You've Got Mail." See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Guy Raz?

  So when that deal unraveled, I'm assuming that was the biggest contract that the company had.

• 0:07Speaker 01

  Yeah, we were banking on that. We just raised a bunch of money, about $5 million, which for us was a lot of money. So when Apple basically said they wanted to pull the plug, pull the rug out from under us, that was a scary time.

• 0:20Guy Raz?

  Did you think the company was going to collapse?

• 0:22Speaker 01

  There was certainly a possibility of that.

• 0:28Guy Raz?

  From NPR, it's How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built.

• 0:41Guy Raz?

  I'm Guy Raz, and on today's show, how Steve Case made email and the internet a normal part of American life and went on to forge the biggest corporate merger in US history.

• 0:59Guy Raz?

  If you happen to be over the age of, say, 35, there is a good chance the first time you ever used email was on a computer with an AOL account. Because in the 1990s, AOL made sure of that by mailing free CD-ROMs to almost every household in the US. You'd pop it into your computer, and within minutes, you could magically type a message to someone else who had something called an email account. And I promise you, if you do not know what I'm talking about, it was magical. It was a miracle. And this revolution in human communication was pushed by companies that are mostly forgotten now: CompuServe, Prodigy,

• 1:39Guy Raz?

  EarthLink, Delphi, and of course, AOL. And out of all of them, AOL prevailed, in part because the company was smart, and in part, as you will hear, it was lucky. Steve Case was as relentless as he was ambitious. And the way he did it, well, like many entrepreneurs, Steve went the corporate route out of college. And in the early 1980s, he landed a job doing product development for Pizza Hut. But at night, he would tinker with his computer.

• 2:11Speaker 01

  You know, went through the process of trying to plug it into a modem. And, you know, back then, it seems silly now, but not many people had PCs. And the vast majority of people had PCs, didn't have the ability to connect their PCs. So you'd have to go to the peripheral section of the computer store to buy something called a modem and figure out how to plug that in.

• 2:29Guy Raz?

  And put the phone receiver on it, right?

• 2:31Speaker 01

  Right. Initially, phone receiver, and then you could plug the line in. But it was viewed as sort of a peripheral, nonessential part of computing. And that was most interesting to me. So when I did buy a computer, I immediately wanted to get it connected. Found that very frustrating process. It was kind of expensive to get online, about $10 an hour. There wasn't much to do. There still wasn't much content online. There obviously weren't many people online. It was really early days, but still, there's something about that that I found magical.

• 2:58Guy Raz?

  What was it?

• 2:59Speaker 01

  It was the fact that you could be anywhere. I happened to be at the time in Wichita, Kansas, and, you know, connect to people and ideas all over the world. And that if you could just take the leap of faith that someday, everybody'd be connected and would just be part of everyday life, then I really believed that would be transformative. Indeed, have the potential to be as transformative as things like the telephone or television.

• 3:23Guy Raz?

  You thought that when you were connecting on this rudimentary modem, you thought, this is going to be transformative?

• 3:29Speaker 01

  I totally did. I just knew it. I didn't know whether I'd be part of it. I didn't know how to get into it. But I always knew the idea of the internet was going to change the world.

• 3:38Guy Raz?

  So at what point are you able to leave Pizza Hut and then, like, go on a completely different career path?

• 3:46Speaker 01

  Well, when I was at P&G and then at Pizza Hut, I was still paying a lot of attention to what was happening, tried to learn more about what's happening, started a little consulting business on the side, consulting with technology companies, trying to... To learn from it. And my brother was an investment banker in San Francisco. And one day, he sent me a business plan of a company that they were thinking of investing in their venture capital.

• 4:06Guy Raz?

  He was just like, what do you think, kind of thing?

• 4:08Speaker 01

  Yeah, what do you think? And he knew I was interested in this space. And so they did decide to invest. I ended up starting a consultant with that company. And then moved to DC to join them the summer of 1983.

• 4:20Guy Raz?

  What was that company called?

• 4:22Speaker 01

  Company's called Control Video Corporation. They had a product called Game Line, which at the time was almost like Netflix for video games.

• 4:29Guy Raz?

  Huh.

• 4:29Speaker 01

  Back then, most people didn't have PCs, but a lot of people had Atari game machines.

• 4:33Guy Raz?

  Right.

• 4:33Speaker 01

  And so Game Line allowed you to turn your game machine into an interactive terminal to download games. And over time, I thought to do email and other things through that terminal.

• 4:42Guy Raz?

  I mean, it must have been a tiny, tiny market.

• 4:45Speaker 01

  It was a tiny market, and it actually turned out to be an idea that, while I thought made tremendous sense, the market didn't agree with. And when they launched the product in the fall of 1983, basically failed. And so suddenly, this company was in freefall. So this was my first experience. And a few months after I was there, I was kind of on teetering on bankruptcy, had to lay off 70, 80% of the employees. And so it suddenly became a struggle.

• 5:09Guy Raz?

  So what happened to your job?

• 5:10Speaker 01

  Well, they kept me, in part because I think there were seven or eight people in the marketing department. And I think I was the only one who survived. And part of it was because I was paid the least, I think. And so I worked with them and trying to figure out some way to reposition it, did some partnerships. But eventually, we decided to start over again. And two of the people that were there at the time, Jim Kimsey and Mark Seraph, and I ended up in 1985, starting essentially what became America Online.

• 5:36Guy Raz?

  At the time, in the mid 80s, if you wanted to get online, what were your options?

• 5:40Speaker 01

  Basically, you had to buy a PC. You had to then figure out a way to buy and integrate this thing called a modem. You then had to subscribe to one of the national online services.

• 5:50Guy Raz?

  And who were the big players at the time?

• 5:51Speaker 01

  Big players we started were CompuServe and The Source. But then neither were particularly big at the time. There were some other ventures that were coming into fruition. There was one in particular called Prodigy that IBM and Sears and for a while CBS committed about a billion dollars to launch Prodigy. So people were piloting things, trying things. But about 3% of America was online, an average of one hour a week.

• 6:14Guy Raz?

  Wow.

• 6:14Speaker 01

  The market still was pretty small.

• 6:16Guy Raz?

  So how did you even get the money for this new venture? Because, I mean, here you are, right? You and your partners failed, basically. Your last business failed. So how did you even find new investors?

• 6:29Speaker 01

  Well, it was a struggle. And some of the investors from the previous company were willing to invest in the new company, and some weren't. And we also were able to attract some new investors. But I think we raised $1 million in that first round.

• 6:40Guy Raz?

  And did you get a decent share of that?

• 6:42Speaker 01

  No. It was kind of unusual because it was this restart, and some of the investors had lost their money on the previous company. Essentially, management started with zero of the company, and the investors were 100%.

• 6:53Guy Raz?

  But you had no choice?

• 6:54Speaker 01

  No choice. We wanted to continue going. We had this idea we wanted to pursue. Back then, in 1985, it was hard to raise venture capital. So at the time, the only path to essentially have a new start, a fresh start, was to agree to a deal where the investors owned the company and the entrepreneur's team, over time, kind of earned their way into part of the company.

• 7:17Guy Raz?

  So, I mean, at that time, in 1985, did you just think to yourself, well, you know, this internet thing's going to be so huge, we're going to all make money off of it, doesn't really matter how we structure this deal?

• 7:28Speaker 01

  It's a mix. I actually, I did believe that, obviously, in the idea of the internet, did believe that, you know, huge companies were going to be built on the back of the internet. But I was driven, as I think a lot of entrepreneurs are, not just by the economic rewards side of it, but really the idea that you could change the world. And so I wanted to figure out some way to take this idea that I was so fascinated with and make it more mainstream. So it frankly mattered less what I was paid, which wasn't much, or how much stock I got, which was not that much in the grand scheme of things. I wanted to pursue this idea, this passion, this dream.

• 8:01Guy Raz?

  And what were you going to do? What was your product? What were you selling?

• 8:03Speaker 01

  Well, we realized then, this was still the early days of personal computers, but there were different manufacturers offering different kinds of computers. And we said, well, instead of trying to do it on our own, why don't we create essentially custom, private-label, online services with each of those companies? So our deals with all these companies would be Commodore, Or Apple or IBM was we'll create the service and you market it. You'll bundle our software with your modems or with your computers or whatever you choose to do. And then we'll essentially share the revenue. And so we created something called Q-Link for Commodore. We created something called PC-Link for Radio Shack. We created something called Promenade for IBM. We created something called Apple-Link for Apple.

• 8:41Guy Raz?

  So if I bought like a Radio Shack computer in 1984, it would come with its like own Radio Shack online service, but your company was the one that was designing that service?

• 8:53Speaker 01

  Correct.

• 8:54Guy Raz?

  So what could you do with it?

• 8:57Speaker 01

  Do a lot of things. I mean, we basically, the core was allow you to download software because at the time that was interesting. But you also could do things like email and participate in message boards and we created chat rooms and other ways. We always believed that the killer app of the Internet was people. Some thought it would be content, particularly the media companies. Some thought it would be commerce, particularly the retail companies. We thought content and commerce would be important, but that community was really going to be the most important. So we always focused on people interacting with each other, even to this day with social media, Facebook and Twitter and Snapchat. Essentially, that idea of community continues to carry forward.

• 9:35Guy Raz?

  So you mentioned that one of your customers was Apple, which by that point was already a big company, as well established. So, I mean, how did you even get them to partner with you? Was it, was that easy?

• 9:47Speaker 01

  No, it was hard. It was, they were skeptical and then they weren't quite sure what part of the company even should deal with this. I ended up moving to the San Francisco area.

• 9:56Guy Raz?

  You left DC and moved to San?

• 9:57Speaker 01

  Left DC, got a department.

• 9:58Guy Raz?

  Just for the Apple?

• 9:59Speaker 01

  Just for the Apple deal.

• 10:00Guy Raz?

  You wanted that deal, you moved to San Francisco.

• 10:02Speaker 01

  Yep. And every day for six months showed up at their office.

• 10:04Guy Raz?

  Just knocked on the door every day?

• 10:06Speaker 01

  Whoever would talk to me, I'd talk to the marketing people, I'd talk to the software people, I'd talk to the customer service people.

• 10:11Guy Raz?

  Were there days where they said, can you please like stop bugging us?

• 10:14Speaker 01

  Yeah, just have to keep, keep going. I wanted to get that deal. I figured somebody, somewhere in Apple was going to say yes. I just needed to find them.

• 10:23Guy Raz?

  Steve Jobs was not there at the time, right?

• 10:26Speaker 01

  Steve Jobs not, he'd been kicked out just before that. And so we worked with a variety of different people within the company, but he was, he was not there during that period.

• 10:33Guy Raz?

  Because if he was there, I can't imagine he would have done a deal with you.

• 10:37Speaker 01

  You're probably right because he was so careful about controlling his brand.

• 10:41Guy Raz?

  Brand, yeah.

• 10:42Speaker 01

  I'm not sure. It was, I think, the first time Apple licensed their brand to another company, and indeed, not long after, within the first year of launching the Apple-on-service. Apple basically decided they didn't like the idea. They wished they hadn't licensed the brand. And so we had a little bit of a standoff. And so we eventually had to rename the service. They paid us a few million dollars to kind of go away quietly. And that's when we had to rename it, so we called America Online.

• 11:07Guy Raz?

  So when that deal unraveled, I'm assuming that was the biggest contract that the company had.

• 11:11Speaker 01

  Yeah, we were banking on that. We'd just raised a bunch of money, about $5 million, which for us was a lot of money, on the idea of expanding this Apple deal. So when Apple basically said they wanted to pull the plug, pull the rug out from under us, that was a scary time.

• 11:27Guy Raz?

  Did you think the company was going to collapse?

• 11:28Speaker 01

  There was certainly a possibility of that. I think there were a lot of our investors who believed that it was going to be hard to recover from this loss. And the idea of essentially moving away from partnering to instead launch our own brand, America Online, with our own marketing, it was scary.

• 11:46Guy Raz?

  Yeah, I mean, it sounds like it was probably also a pretty lonely time, right? Because you were just, like, really waiting for this thing to take off.

• 11:53Speaker 01

  Yeah, it was lonely. And I'd even go to industry conferences. I remember one in the late 80s called PC Forum. There'd be 300 or 400 people there, and there'd be one or two that were focused on the internet. Most were focused on semiconductors or software or something else. And so we were viewed as sort of this fringy little hobbyist thing that, you know, most people didn't ever believe would amount to much. But I still believed. I kept at it.

• 12:18Guy Raz?

  Steve Case, in just a minute, how Steve and America Online created one of the most iconic sounds of the 1990s.

• 12:26Speaker 01

  You've got mail.

• 12:28Guy Raz?

  I'm Guy Raz, and you're listening to How I Built This from NPR.

• 12:41Guy Raz?

  It's How I Built This from NPR. I'm Guy Raz. So when Steve Case launched America Online in the mid-1980s, the internet as we know it did not yet exist. AOL was basically a service that let subscribers log on, use chat rooms and email, but you couldn't visit websites that were outside of the AOL service. Actually, until 1991, it was illegal for most people to connect to the internet. At the time, it was a network of computers used by research universities and the Department of Defense. So, explain how AOL then really started to take off. I mean, it becomes AOL. You say Congress passes legislation that allowed the internet to become commercialized, which

• 13:26Guy Raz?

  obviously was a huge turning point for you guys. And was that it?

• 13:30Speaker 01

  That was it, as well as by then we had convinced PC manufacturers to build modems in, so it suddenly was a standard part of a computer and not a peripheral. World Wide Web was also created in that 93-ish timeframe. And so all these things really kind of came together. But when we went public, took AOL public in 1992, it was the first internet company to go public, and we had less than 200,000 customers. Been at it for seven years. The first decade was slow and hard and two steps forward, one step back. It's the second decade that things really kicked in, and thankfully, we did stick with it.

• 14:06Guy Raz?

  But in those early days, when you were still a pretty young guy, were you running the company?

• 14:12Speaker 01

  Over time, when we started, I was, I think, 25, 26, something like that. I was kind of a young kid with sort of the crazy marketing partnership ideas. But over time, I got more responsibility, took on more roles. And I think it was in 1991, I was named CEO of the company. Sadly, at least for me, when we decided in 1992 to go public, the board decided I was too young to be CEO.

• 14:37Guy Raz?

  They didn't want you to be the face of the company?

• 14:39Speaker 01

  Well, they just, again, lots changed in the past three decades. But back then, the idea of the internet was sort of foreign, and there were not 30 Your old CEOs, you know, taking companies public.

• 14:50Guy Raz?

  How did you feel about being demoted?

• 14:52Speaker 01

  I was quite upset. I didn't think it was fair. But same time, I cared about the company and decided to weather that storm. And I did understand at one level, I didn't fully agree with it, but did understand this logic that institutional investors, who didn't understand what the Internet was and didn't understand why it would ever amount to much, you know, it was even harder if it was some, you know, kid who was untested and didn't have significant business experience.

• 15:17Guy Raz?

  When you did eventually formally lead the company, what kind of leader were you? What did you think your role was?

• 15:26Speaker 01

  I think it evolved, certainly as the Internet became much more of a force in the mid to late 90s. I became not just the spokesman for AOL, but also for the Internet. So even when I was CEO, people used to joke, I wasn't just CEO of the company. I was also sort of the mayor of the community. I'd write monthly letters to our members, talking about what's happening and what our strategy is. I wanted them all to feel like they were part of this effort. So it really was sort of a cheerleader, kind of, you know, rallier role even 20 years ago.

• 15:57Guy Raz?

  Give us a sense of what kind of environment you were operating in, because this is like the early 90s. How do you sell this idea to customers? How do you even describe what the Internet is at that time?

• 16:08Speaker 01

  Well, it was challenging, but it went back to trying to figure out ways to partner. So even if it wasn't PC manufacturers, we partnered with New York Times and Time Magazine.

• 16:16Guy Raz?

  To what, to offer their publications?

• 16:18Speaker 01

  Offer their publication. Also essentially have the credibility, their names associated with what we were doing.

• 16:22Guy Raz?

  So when you would go to AOL, you could get Times headlines and...

• 16:25Speaker 01

  Yeah, weather the encyclopedia. We partnered with lots of companies that provided some of the services, some of the content that would make it more interesting, but also made it more credible.

• 16:35Guy Raz?

  I think anybody who's over the age of like 35 probably remembers having an AOL account, right? Like you would log on and you would hear, "Welcome, you've got mail." How did that, how did that come about?

• 16:47Speaker 01

  The voices, well, we were in that early 90s. We're trying to figure out a way to make the internet more accessible, more something that people could relate to. So we're trying to humanize the internet, put a friendly face on it. One way to make it seem more friendly, more human, was to actually have a person welcoming you to the service. And so I was talking about that one day with our customer service department. A woman there basically said, well, my husband does voiceover kind of thing, so he'd be happy to tape some messages. And so I got my little pen down, a little Post-it note, and wrote a bunch of different things like, "You've got mail." And that guy, Alwood Edwards, recorded them that night and brought in the next day a little cassette tape. And they said, "Well, that sounds pretty good. Let's stick it on the software." And then they became one of the most recognizable voices of that generation.

• 17:31Guy Raz?

  Do you remember the moment when you realized that this was going to be a huge, like, consumer product, not just for 3% of Americans, but for most people, like, when it was going to be huge?

• 17:42Speaker 01

  Well, to be honest, the moment I thought that was 1980, when I first started focusing. I just, in my heart of hearts, believed that the day where it became clear that that was actually happening, and wasn't just sort of a crazy pipe dream. I think the year was 1996, and we had moved to unlimited pricing, and we had system problems, our system actually was down for 23 hours, nobody could log in. And it was a national news story. It led the network TV news, was the lead article in most newspapers, and suddenly the fact we were down for 23 hours was a national crisis. That's when I knew that this idea of the internet had arrived. It was frustrating, because obviously, we were down, and a lot of people had been counting on us, and we let them down.

• 18:23Speaker 01

  But it also was just a sign that this really was becoming real, and this, you know, the idea of the internet was becoming part of everyday life, and had gone from something when we got started in 1955 that nobody knew about or cared about, to suddenly something that people needed and couldn't live without.

• 18:39Guy Raz?

  I guess, once you really started to take off in the mid-'90s, all of a sudden, Microsoft says, "We want to get into this business. We want to have our own portal to the internet." Phil Gates summons you to Seattle to meet with him, and what makes, makes an offer to buy you guys out?

• 18:55Speaker 01

  They basically said they decided this Internet world, this online world was now a strategic priority for them. They're going to take it very seriously. They're planning to create their own service. They're planning to bundle it with every copy of Windows, but they respected what we were doing. And if we had a willingness to sell our company to them, then instead of building their own thing, then they would be happy to indeed prefer kind of going with us. And so it was a little scary because we knew the threat of Microsoft was pretty serious. And some of our investors, some of our board members did feel like we should quit while we're ahead. Maybe we can't compete in this new era with Microsoft. So it came down to a close vote, but eventually the board decided not to sell to Microsoft. Microsoft did, in fact, launch their own service.

• 19:40Guy Raz?

  And were you worried that they were going to crush you?

• 19:42Speaker 01

  Oh, sure. We were quite worried they were going to crush us because they had a lot more money than, particularly the power of distribution, the fact that essentially every computer shipped with their Windows software, and they were saying they were going to include in every copy of that access to their service or every computer when you first turn it on would automatically, basically be going to Microsoft. So we were quite afraid.

• 20:05Guy Raz?

  How did you combat that? How did you fight against that? What did you do?

• 20:10Speaker 01

  First of all, we tried to rally the team to really focus on what made us unique, what made us different. And we actually, the fact that we knew Microsoft was coming, ended up rallying the company and the partners of the company to be much more ambitious in terms of what we were trying to do. And we used to say that, you know, let's do what we can today to build a larger audience, create more content. And so that actually ended up pushing us to do better than we likely would have done without the threat of Microsoft looming over us.

• 20:37Guy Raz?

  I know that today your relationship is much different, but back then, did you think Bill Gates was just being super aggressive? I mean, did you?

• 20:44Speaker 01

  Oh, yeah, of course. Yeah, he was being super aggressive.

• 20:46Guy Raz?

  And was it personal for you?

• 20:48Speaker 01

  I'm not sure it was personal. I mean, I understood why they were doing what they're doing, and I think they understood why we were doing what we were doing. So it was something that we wanted to prevail. We wanted to win. And I remember even one cover story of Fortune magazine in the mid to late 90s, basically had Bill Gates on the cover of the magazine saying, who is going to win the battle for the Internet? Of course, the answer was none of the above.

• 21:17Guy Raz?

  Towards the end of the 90s, a huge change for AOL when you basically buy Time Warner. Why did you want to do that?

• 21:25Speaker 01

  A mix of things. So first of all, from a financial standpoint, we had a pretty good run. It was the best performing stock of the decade. I think our peak was $150 billion, so it really had been rocking.

• 21:36Guy Raz?

  And what percentage of the, I heard something like 30% of all internet traffic went through AOL?

• 21:41Speaker 01

  At the time, it was more like 50%. We were the leader of the pack, but we were the leader of the pack in what was called the narrowband world with dial-up modems. We didn't have a clear path to broadband, which was controlled by the cable companies. We tried to figure out ways to get into that, but it was looking like a struggle.

• 21:56Guy Raz?

  You were looking ahead and you knew you were going to run into problems if you did nothing.

• 22:01Speaker 01

  Correct. We knew it would be more difficult to maintain a lead in the broadband world, so we needed to figure out some way to do that. One of the things that was attractive to us about a merger with Time Warner in particular was they had the largest cable network. And so the fact that they had that broadband footprint was really a key driver for us as well. So it was partly financial. We went from our company, when we did the merger, I think it was $5 billion of revenue, about $1 billion of profit. The combined company had $40 billion of revenue, $10 billion of profit. So from a financial diversification standpoint, it made sense as well.

• 22:35Guy Raz?

  As you know, it's like a classic case study at business schools today, right? Of a disastrous partnership. You were blamed for a lot of it. You know this, you've read all the articles from the time. Did that get to you?

• 22:50Speaker 01

  Sure, sure. I always believed, still believe, the idea of the merger made sense. I think it really was the execution, particularly around people and culture, where things got rocky. And I was very frustrated that the company wasn't able to achieve the kind of vision that I certainly thought was possible.

• 23:07Guy Raz?

  Was it you couldn't convince people of what you wanted to do? Or that... You just saw the world in different ways?

• 23:12Speaker 01

  It's a mix of things. Some of it was the market itself. Right after we did the merger, the stock market generally went into decline. The internet sector went into kind of a free fall. So that was unhelpful timing. Also, as part of the merger, to get the merger done, I stepped aside as CEO. So I didn't have direct control of any of the businesses, including AOL. I was just overseeing the board itself. Some of it was the fights within the company. Time Warner historically had been organized as a lot of independent companies. So part of the idea of the merger was to run it in a more integrated way. But that really never, never happened. So it was a mix of different factors. But at the end of the day, it really was about execution. And the key lesson is that it really does come down to people. How do you take these ideas and make them real? And it's about people and it's about teams.

• 23:57Guy Raz?

  Were you just miserable doing that job? Did you just hate doing that job?

• 24:01Speaker 01

  Miserable is maybe a little strong. But yeah, I was frustrated. It was harder to, after basically a decade of being CEO and leading the charge and being on the field, it was hard to be kind of in the skybox, not really having that day-to-day interaction. And obviously, there were some strategic differences that I had with others on the team, others on the board, and that was frustrating as well.

• 24:25Guy Raz?

  When you left Time Warner AOL, what did you think? I mean, you were looking for something new to do. Did you know what you wanted to do?

• 24:33Speaker 01

  Not specifically, but I knew I wanted to do something that was more entrepreneurial. I loved the whole 20-year journey I had with AOL. But I realized that the first 10 years, even though it was harder and more frustrating and scarier and lonelier, that part of it I really enjoyed. And so that I wanted to go back to the garage and kind of roll up my sleeves and focus on new things. At the same time, I decided, rather than start another company, I wanted to figure out a way to partner with and mentor and invest in entrepreneurs in a variety of different sectors. And that's really what I've been doing for the past 15 years or so.

• 25:10Guy Raz?

  What do you think is the most important quality or characteristic that you've, that you either have or you've developed over time that's allowed you to be successful as an entrepreneur?

• 25:22Speaker 01

  I think it's a mix of skills. Some of it is, you know, goes back to the idea, the vision side of it, and being pretty good at seeing around corners, pretty good at pattern recognition, getting a sense of what might be happening. I think perseverance, I think being willing to take a long-term view. As we discussed, the A W L journey was a decade in the making overnight sensation. And so recognizing that revolutions sometimes happen in evolutionary ways and you've got to have to take a long-term view and be steady there. And the other is a respect for the role of government and the role of policy that I have an appreciation that I've developed over the years of that role, partly because the internet wouldn't exist without the government. You know, it was the government 50 years ago that funded DARPA that created the internet. It was the government through the judicial system that broke up the phone company,

• 26:05Speaker 01

  you know, Ma Bell, which unleashed competition and lowered prices in telecommunications. The government that then commercialized the internet with the telecom act. So I just understand the role of policy. I think when you are trying to figure out ways to innovate, these are going to be tough challenges to take on.

• 26:21Guy Raz?

  You know, earlier, Steve, you talked about like being a cheerleader, right? Like, how important do you think it is for the CEO or the entrepreneur behind the company to be the head cheerleader? Do you think that's crucial or is it a little overrated?

• 26:36Speaker 01

  No, I think it is crucial. You know, people have to believe in the mission. They have to believe it's sort of a battle worth fighting, a mountain worth climbing. The most entrepreneurial journeys are circuitous and, you know, two steps forward, one step back, and can be sometimes scary. And so just reminding people why this, you know, why it's important to not just focus on the vision, but also the execution and priorities and things like that. I think that is part of the journey. If you're really trying to change the world, you're really trying to disrupt important aspects of our lives.

• 27:09Guy Raz?

  Steve Case, founder of America Online. In 2005, he moved on to found a venture capital company in Washington DC. It's called Revolution. By the way, during the Obama administration, Steve was a member of the president's Council on Jobs and Competitiveness, and that wasn't the first time he'd met Barack Obama. In fact, Steve and President Obama actually went to the same high school together in Hawaii.

• 27:32Speaker 01

  He was there at the same time, but no, I was a senior when he was a freshman. I did joke that before he made his run for the presidency, I was, you know, the best-known

• 27:40Guy Raz?

  He overshadowed you a little bit.

• 27:41Speaker 01

  Graduate, totally overshadowed, man. That one's a goner. He's won that one for generations.

• 28:00Guy Raz?

  And stick around. In just a moment, we're going to hear from you about what you're building.

• 28:07Guy Raz?

  Hey, thanks for sticking around because it's time now for how you built that. We know from reading all your stories and emails that an idea for a business can come from just about anywhere. And for Christina Kazakia, her idea was about as basic as it gets.

• 28:23Speaker 02

  Well, when I was walking around Providence, I just kept seeing sticks everywhere.

• 28:27Guy Raz?

  Sticks, like, you know, the kind you just see lying around in the grass?

• 28:31Speaker 02

  I was like, OK, sticks are on the floor, kids are playing with sticks. I loved building a fort as a kid, and all my other friends loved building forts, too.

• 28:37Guy Raz?

  By the way, this was all going through Christina's mind about four years ago when she was at design school in Providence. And for her final project, she was thinking, maybe I'll make a new toy.

• 28:48Speaker 02

  And that's when I realized I need to find a way to get kids outside, today's kids, away from the screen, away from battery toys, to get outside and engage.

• 28:57Guy Raz?

  Because, you know, what kid doesn't want to be pried away from her iPad or Playstation to build a teepee made of sticks in the backyard? A challenge admittedly, but Christina started tinkering with an idea to help kids connect sticks into shapes.

• 29:13Speaker 02

  You know, I started working with existing connectors and like rubber bands and zip ties to understand, OK, how do you tie a knot? How do you secure something?

• 29:23Guy Raz?

  And eventually, she designed these stretchy connectors made of silicone. And she called them Sticklets.

• 29:29Speaker 02

  They're almost like cookie cutout shapes. And they have two to four holes in the shapes. And all the holes are various sizes. And you can use them with little twigs that you find or huge branches that you find.

• 29:41Guy Raz?

  And you might be thinking, why do I need silicone connectors to build a fort? I mean, I could just use rope to tie sticks together, right? But Christina says Sticklets are a lot easier to use.

• 29:53Speaker 02

  Especially the younger kids. They love that they're stretchy and so pliable. They'll bring people over and say, look what I built. Like, look, this is the raccoon's chimney, and he's climbing up and he goes down. We gotta add a stick.

• 30:06Guy Raz?

  Anyway, after Christina made a demo of her Sticklets for that project at design school, people would ask her, where can I get them? So she started to sell them for real and eventually to sell them in toy stores and then online. But some of her toughest customers were the parents.

• 30:24Speaker 02

  Occasionally, parents will contact me and be like, well, wait, don't you have like step-by-step instructions? Like, how do we do this? I don't get it.

• 30:31Guy Raz?

  Christina says the whole point of Sticklets is that kids don't want instructions. They just want to figure out how to connect things on their own. But because parents are demanding it, she is now writing a manual on all of the stuff you can make with sticks.

• 30:47Speaker 02

  But the challenge is, well, how do we show parents the value of what they're paying for? How do we convince them that it's worth the money because it's a higher quality, higher-end toy?

• 30:57Guy Raz?

  A pack of six Sticklets, by the way, goes for about $17. Silicone is expensive, but you can use them over and over and over again. To find out more about Christina Kazakia and her company Sticklets, go to our Facebook page. And of course, if you have a story about something you are building, please tell us about it. Go to build.npr.org.

• 31:23Guy Raz?

  And thanks so much for listening to the show this week. If you want to find out more about who was on it, go to howibuiltthis.npr.org. You can also follow us on Twitter. That's @howibuiltthis. And you can write to us at [email protected]. Our show was produced this week by Casey Herman, with music composed by Ramtin Arablouei. Thanks also to Neva Grant, Sanaz Meshkhanpour, and Jeff Rogers. Our intern is Claire Breen. I'm Guy Raz, and you've been listening to How I Built This from NPR.

• 32:16Guy Raz?

  Hey, one more thing. There are tens of thousands of podcasts out there. It's pretty hard to know what's good. But WAMU and NPR's The Big Listen has come to the rescue. Host Lauren Ober introduces you to podcasts you might never have heard of and gives you the inside scoop on shows you already love, like the one you're listening to right now. Find The Big Listen on the NPR One app and npr.org/podcasts.