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Introducing Business History: The Edison Invention People Don't Talk About · What's Your Problem?

• 0:15
  Speaker 1: Pushkin. Hey, it's Jacob. Today. We are going to play
• 0:21
  Speaker 1: for you an episode of a new show that I'm
• 0:23
  Speaker 1: hosting in addition to What's Your Problem. The new show
• 0:26
  Speaker 1: is called Business History because it's a show about the
• 0:30
  Speaker 1: history of business. I'm hosting it with Robert Smith, who
• 0:33
  Speaker 1: some of you might remember I used to work with
• 0:36
  Speaker 1: at Planet Money. He was a co host at Planet Money.
• 0:38
  Speaker 1: And the episode we're going to play today is about
• 0:40
  Speaker 1: Thomas Edison, who is an extremely What's Your Problem kind
• 0:45
  Speaker 1: of guy, huge figure in the history of technology, very
• 0:48
  Speaker 1: interesting in many ways. This is actually the first of
• 0:51
  Speaker 1: a three episode series we're doing about Edison. If you
• 0:55
  Speaker 1: happen to subscribe to Pushkin Plus, you can listen to
• 0:58
  Speaker 1: the whole series now. Otherwise they'll come out one episode
• 1:01
  Speaker 1: a week over the next few weeks in the Business
• 1:03
  Speaker 1: History Feed, which you can of course get wherever you
• 1:06
  Speaker 1: are listening to this show right now. So if you
• 1:09
  Speaker 1: happen to want to see me and Robert in addition
• 1:11
  Speaker 1: to hear us, you can watch it on YouTube. I
• 1:14
  Speaker 1: hope you like the show. If you like it, of
• 1:16
  Speaker 1: course I would love it if you would subscribe. Thanks.
• 1:19
  Speaker 2: Here's the show Business History, Episode two Edison Part one.
• 1:25
  Speaker 1: What if that's the segment that's sponsored, sponsored by what
• 1:28
  Speaker 1: by whoever wants to pay for it. We can talk
• 1:32
  Speaker 1: about that afterwards. I suppose Thomas Edison died in nineteen
• 1:45
  Speaker 1: thirty one. He was eighty four years old, and when
• 1:48
  Speaker 1: he died, the President of the United States, Herbert Hoover,
• 1:52
  Speaker 1: decided that Edison was such a big deal that the
• 1:55
  Speaker 1: whole country, the entire United States, needed a moment of mourning.
• 1:59
  Speaker 1: So Hoover is talking this over with his says, what
• 2:02
  Speaker 1: should we do to honor Edison? And somebody says, what
• 2:05
  Speaker 1: if the whole country turns off the electricity for one
• 2:09
  Speaker 1: minute to honor Thomas Edison, the man who brought electricity
• 2:12
  Speaker 1: to the masses. And you're laughing for what I think
• 2:15
  Speaker 1: is an obvious reason, right.
• 2:17
  Speaker 2: Because if you think about it, who needs electricity all
• 2:21
  Speaker 2: the time?
• 2:21
  Speaker 1: Right? Everyone?
• 2:23
  Speaker 2: Everybody, Fire departments, hospital, sanitation systems, They all needed every
• 2:28
  Speaker 2: minute they need this thing that Edison helped create, electric power, this.
• 2:33
  Speaker 1: Thing that nobody had, nobody had, you know a few
• 2:37
  Speaker 1: decades before this crucially right, this itself is testament to Edison. Right,
• 2:43
  Speaker 1: this fact that if you turn off electricity for one minute,
• 2:46
  Speaker 1: people will die. And Hoover actually puts out this official
• 2:51
  Speaker 1: statement where he walks through this thought process that he
• 2:54
  Speaker 1: and his aides have gone through. He writes, quote, this
• 2:58
  Speaker 1: demonstration of the dependence of the country upon electrical current
• 3:01
  Speaker 1: for its life and health is in itself a monument
• 3:05
  Speaker 1: to mister Edison's genius. And so Hoover decides, Okay, we'll
• 3:09
  Speaker 1: do this more modest thing where it's like, if you
• 3:12
  Speaker 1: want to turn off the lights for one minute at
• 3:15
  Speaker 1: ten PM, and a lot of the country does it, so.
• 3:18
  Speaker 2: I can imagine the nation city in the dark for
• 3:20
  Speaker 2: sixty seconds, just waiting to turn the lights back on.
• 3:24
  Speaker 2: You can hear a fridge whirring in the background. Did
• 3:27
  Speaker 2: not exist when Edison was born. Maybe the radio's playing
• 3:30
  Speaker 2: softly that wasn't around. And when the light comes back on,
• 3:34
  Speaker 2: people could see cars in the streets, planes in the
• 3:37
  Speaker 2: sky that didn't exist fifty years earlier. You could see
• 3:40
  Speaker 2: the Empire State Building and the Chrysler Building.
• 3:42
  Speaker 1: Both brand new at the time, as were skyscrapers in general,
• 3:47
  Speaker 1: because you couldn't build a skyscraper if you didn't have electricity,
• 3:50
  Speaker 1: because nobody's going to walk. What is it one hundred
• 3:52
  Speaker 1: stories up right, buildings were like ten stories tall max.
• 3:55
  Speaker 1: Before electric grids.
• 3:57
  Speaker 2: When we look back, Edison's life was probably this moment
• 4:00
  Speaker 2: in US history where the most progress was made between
• 4:03
  Speaker 2: the time he was born and the time he died
• 4:05
  Speaker 2: technological progress, and if you look in such a compressed
• 4:09
  Speaker 2: period of time, it is unimaginable how much life changed
• 4:13
  Speaker 2: for people.
• 4:14
  Speaker 1: Certainly if you were eighty years old, but even if
• 4:15
  Speaker 1: you were sixty years old, your life was entirely different
• 4:21
  Speaker 1: by nineteen thirty than it had been when you were
• 4:23
  Speaker 1: a small child. And you know, to be clear, Edison
• 4:27
  Speaker 1: wasn't the cause of all of that. He didn't have
• 4:29
  Speaker 1: anything to do with cars and planes. He didn't really
• 4:32
  Speaker 1: invent the light bulb, in fact, though people thought he did.
• 4:35
  Speaker 1: And there was this myth of Edison that was part
• 4:37
  Speaker 1: of the story. But I think Edison really did do
• 4:41
  Speaker 1: as much as anybody. He certainly did an incredible amount
• 4:45
  Speaker 1: to use technology and business to bring about this incredible
• 4:50
  Speaker 1: change in daily life for hundreds of millions of people.
• 4:54
  Speaker 2: I'm Jacob Goldstein and I'm Robert Smith. And this is
• 4:57
  Speaker 2: Business History, a show about the history of business.
• 5:00
  Speaker 1: So why would call it business history? Because it's about
• 5:03
  Speaker 1: the history of business. And today we are starting on
• 5:06
  Speaker 1: a three part series big pretty sure it's going to
• 5:08
  Speaker 1: be three about Thomas Edison. Edison was this incredible figure
• 5:14
  Speaker 1: in a lot of ways. He was an inventor, a tinker.
• 5:17
  Speaker 1: He was like a grinder, you know, workaholic, huge self promoter,
• 5:21
  Speaker 1: great entrepreneur. Invented the photograph, built the first electric grid
• 5:25
  Speaker 1: of any size to light up Lower Manhattan, controlled essentially
• 5:28
  Speaker 1: the entire American movie business. But today, in the first
• 5:33
  Speaker 1: episode about Edison, I'm going to argue that the most
• 5:36
  Speaker 1: important thing he did came before any of that, and
• 5:40
  Speaker 1: it wasn't even any particular thing or system that he invented.
• 5:45
  Speaker 1: It was this kind of meta breakthrough. It was this
• 5:49
  Speaker 1: new way of inventing, and it happened early in Edison's life.
• 5:53
  Speaker 1: It happened before he was thirty years old. So he
• 5:55
  Speaker 1: came up with a new way of inventing that industrialized invention,
• 5:59
  Speaker 1: and that really created the template for the modern twentieth
• 6:04
  Speaker 1: century style of progress. That was his great break.
• 6:08
  Speaker 2: Which we see even to Internet AI everything. Thomas Alva Edison,
• 6:16
  Speaker 2: it's one of those people you love saying is middle
• 6:17
  Speaker 2: name Alva He was born in what was already an
• 6:20
  Speaker 2: age of miracles. There was the railroad, and there was
• 6:23
  Speaker 2: the telegraph, and they were shrinking this very notion of distance,
• 6:27
  Speaker 2: of time and space. It felt like an age that
• 6:31
  Speaker 2: was on the move, and the spirit of invention, of
• 6:34
  Speaker 2: innovation was everywhere. And Edison had this particular combination of traits, right.
• 6:40
  Speaker 2: He was an inventor, that's we learned about in school,
• 6:42
  Speaker 2: of course, but he was also a hustler, an entrepreneur.
• 6:45
  Speaker 2: He was interested in new things, but he always asked himself,
• 6:49
  Speaker 2: what are people willing to pay for?
• 6:51
  Speaker 1: Yeah, And it's really striking. You see both of these traits,
• 6:56
  Speaker 1: the entrepreneur and the inventor of the tinker. You see
• 6:59
  Speaker 1: them from very early in his life. You see him
• 7:01
  Speaker 1: from when he's a kid, a little kid. So he's
• 7:03
  Speaker 1: born in eighteen forty seven in a town called Port Huron, Michigan.
• 7:08
  Speaker 1: On the show of Lake Huron, I'll be honest with you,
• 7:12
  Speaker 1: I did not remember as one of the great lakes.
• 7:14
  Speaker 1: It's one of the greatest of the lakes. You have
• 7:15
  Speaker 1: got it, have you been.
• 7:16
  Speaker 2: I was born between Lake Huron and Lake Erie in London, Ontario, Canada.
• 7:22
  Speaker 1: Yeah, yeah, I wouldn't have got it. Yeah. So he's
• 7:24
  Speaker 1: born on the shore of Lake Huron, this little town
• 7:26
  Speaker 1: out in the middle of nowhere. He barely goes to school,
• 7:30
  Speaker 1: goes to school for like a few months here and there.
• 7:32
  Speaker 1: It was a bad distracted student and he's working from
• 7:36
  Speaker 1: a young age. When he's twelve, he gets a job
• 7:39
  Speaker 1: selling like candy and newspapers on the train that goes
• 7:43
  Speaker 1: back and forth from Port Huron to Detroit. He's working
• 7:46
  Speaker 1: the angles, he's hustling. There's this detail that I love,
• 7:49
  Speaker 1: which is, you know, when the train gets to Detroit,
• 7:52
  Speaker 1: he gets a bunch of newspapers to sell on the
• 7:54
  Speaker 1: way back to Port Huron. And if he has some
• 7:57
  Speaker 1: unsold papers, when he's almost back to the end of
• 7:59
  Speaker 1: the line, while the train is still moving at the
• 8:03
  Speaker 1: edge of town in Port Huron, there's this like sandbank
• 8:06
  Speaker 1: or something. He throws the bundle of papers off the
• 8:09
  Speaker 1: train into the sandbank. Then he jumps off the moving
• 8:11
  Speaker 1: train after him and walks home, selling the papers one
• 8:15
  Speaker 1: by one.
• 8:15
  Speaker 2: These days, we don't let twelve year olds out by themselves,
• 8:18
  Speaker 2: you know, in the modern era, these guy's jumping off trains.
• 8:21
  Speaker 1: Yeah, and like obviously a bad idea, but in my heart,
• 8:25
  Speaker 1: I kind of love it, like in my twelve year
• 8:27
  Speaker 1: old boy heart's seat on the log Yeah yeah, yeah.
• 8:30
  Speaker 1: So you know he's out there selling newspapers on the train,
• 8:34
  Speaker 1: off the train, and after a little while he thinks, wait,
• 8:37
  Speaker 1: I'm just like a chump. I'm out here working for
• 8:39
  Speaker 1: the man. I could be selling my own papers. And
• 8:43
  Speaker 1: so he buys a used printing press, puts it into
• 8:47
  Speaker 1: some space on a baggage car on the train, and
• 8:50
  Speaker 1: starts printing his own newspaper on the train.
• 8:54
  Speaker 2: What is he reporting on? Like the guy in seat
• 8:56
  Speaker 2: thirteen B. You know he's got a hot tip.
• 8:59
  Speaker 1: It's it's not a lot of news. It's that news heavy.
• 9:01
  Speaker 1: You might call it a newsletter. Yeah, okay, the Weekly Herald,
• 9:05
  Speaker 1: Thomas A. Edison publisher. It's like one page, but selling
• 9:09
  Speaker 1: it and making all the profits and keeping all the
• 9:11
  Speaker 1: profits right, cutting out the middle man. So there's entrepreneur Edison,
• 9:16
  Speaker 1: and like right next to entrepreneur Edison in that same
• 9:20
  Speaker 1: baggage car, you see Edison the inventor, because next to
• 9:24
  Speaker 1: the printing press, he sets up this little chemistry lab.
• 9:28
  Speaker 2: So he's got like magnesium and potassium. He's like making
• 9:31
  Speaker 2: things turn purple.
• 9:33
  Speaker 1: I'm imagining like things bubbling. I don't I don't know.
• 9:36
  Speaker 1: There's one thing I do know, which is he has
• 9:38
  Speaker 1: some phosphorus. And the reason I know he has fosporus, right, oh,
• 9:44
  Speaker 1: is at some point the phosphorus like spills or whatever
• 9:47
  Speaker 1: and starts a fire on the train bag, on the train,
• 9:50
  Speaker 1: on the train car. Yeah, which is like, obviously that's
• 9:53
  Speaker 1: gonna happen. You have a teenage boy with like dangerous
• 9:55
  Speaker 1: chemicals out to trade. Of course you're gonna start a fire.
• 9:58
  Speaker 1: And of course if you do that, you're gonna get fired,
• 10:00
  Speaker 1: which is what happens to Edison. So he gets fired
• 10:04
  Speaker 1: and now comes this very Horatio Alger turn and that
• 10:09
  Speaker 1: is this So not long before the fire and the firing,
• 10:13
  Speaker 1: Edison has been hanging out at a train station and
• 10:16
  Speaker 1: there is this little toddler stay with me, who is
• 10:19
  Speaker 1: out playing on the track and a loose car train
• 10:24
  Speaker 1: car comes rolling at the toddler and sees it happening,
• 10:27
  Speaker 1: and he goes it grabs the toddler and brings him
• 10:29
  Speaker 1: to safety.
• 10:30
  Speaker 2: And this story is almost too perfect, right. A runaway
• 10:33
  Speaker 2: box car toddler on the tracks is Steven Spielberg writ
• 10:36
  Speaker 2: this apocryphull the word you're looking for. The history he
• 10:38
  Speaker 2: gave is apocryphal, too good to be true.
• 10:40
  Speaker 1: Although I looked at this and thought about it, and
• 10:44
  Speaker 1: I think it is true. You know, there is one
• 10:47
  Speaker 1: recent biographer of this guy, Randall Strauss, who is like
• 10:50
  Speaker 1: particularly skeptical of Edison's self mythologizing, and he thinks it's true.
• 10:54
  Speaker 1: And you can see letters between Edison and the kids dad.
• 10:57
  Speaker 1: So I think the world used to just be more wild, right,
• 11:00
  Speaker 1: like more dangerous. So yes, I think it's true. But
• 11:05
  Speaker 1: at this moment it is in fact helpful for Edison
• 11:07
  Speaker 1: because because the father of the child that Edison rescues
• 11:12
  Speaker 1: runs the station but also is a telegraph operator, and
• 11:17
  Speaker 1: so when Edison gets fired, this grateful father teaches Edison
• 11:23
  Speaker 1: to be a telegraph operator. This is the next phase
• 11:28
  Speaker 1: of Edison's life, right, Being a telegraph operator proves to
• 11:31
  Speaker 1: be a huge opportunity for him. But I want to
• 11:34
  Speaker 1: say one thing first, because it's another big moment, and
• 11:36
  Speaker 1: that is Edison, by the time he's twelve years old,
• 11:41
  Speaker 1: is mostly deaf, like not entirely deaf. People can shout
• 11:45
  Speaker 1: to him and he can hear but the key quote
• 11:48
  Speaker 1: he has later is I haven't heard a bird sing
• 11:50
  Speaker 1: since I was twelve years old, which is poignant, especially
• 11:53
  Speaker 1: for like I was gonna spoiler alert invent the phonograph,
• 11:56
  Speaker 1: but he said Edison said he didn't mind it. It
• 11:59
  Speaker 1: helped him focus, helped him like tune out distractions. He
• 12:02
  Speaker 1: was a very focused man. And there is this actually
• 12:05
  Speaker 1: lovely detail which is later in his life when he's
• 12:07
  Speaker 1: like famous and going to lectures, you know in big halls,
• 12:10
  Speaker 1: when you can't hear what the guy is saying, his
• 12:12
  Speaker 1: assistant will tap on Edison's leg. We'll tap with the
• 12:15
  Speaker 1: person is saying in morse code.
• 12:17
  Speaker 2: So this is an opportunity for Edison because at this point,
• 12:22
  Speaker 2: like the telegraph is the cutting edge communication tool, like
• 12:26
  Speaker 2: it's just exploding at this time. They've just around this
• 12:29
  Speaker 2: time laid the first transatlantic cable. Suddenly you could communicate instantaneously.
• 12:34
  Speaker 1: Right, You're in the.
• 12:35
  Speaker 2: Midst of a civil war. People want to know the news,
• 12:38
  Speaker 2: and suddenly they can know it. They can move troops,
• 12:40
  Speaker 2: they can know what's happening, and people are just sort
• 12:43
  Speaker 2: of getting used to this idea of information is not
• 12:47
  Speaker 2: this rare thing that you print on the newspaper and
• 12:51
  Speaker 2: deliver the next day. Like information is power, it's instantaneous. Yeah,
• 12:55
  Speaker 2: Edison learning.
• 12:55
  Speaker 1: To be a telegraph operator is him walking into this
• 12:58
  Speaker 1: great technological moment of his time. And there is this
• 13:02
  Speaker 1: one particular story that I love about how transformation all
• 13:08
  Speaker 1: the tele is. It's about a pickpocket gang in London
• 13:14
  Speaker 1: run by a guy named Fiddler Dick. Govnor watch out
• 13:20
  Speaker 1: for Fiddler Dick. Uh very good. What Fiddler Dick's gang
• 13:25
  Speaker 1: does is this, They loiter on a train platform and
• 13:29
  Speaker 1: then the train pulls in, and you know, it's chaos.
• 13:32
  Speaker 1: People are getting off the train, people are getting on,
• 13:34
  Speaker 1: they're moving around, they've got all their stuff out, and
• 13:36
  Speaker 1: Fiddler Dick and his boys pick the pockets to the
• 13:38
  Speaker 1: people in the crowd, and then just as the train's
• 13:41
  Speaker 1: about to pull out, they hop on the train and
• 13:43
  Speaker 1: head to the next station. And this is an incredible strategy, right,
• 13:47
  Speaker 1: because if you are on a moving train in say
• 13:51
  Speaker 1: eighteen forty, there is literally no way to send information
• 13:57
  Speaker 1: faster than you are traveling. You might as well be
• 13:59
  Speaker 1: going at the speed of light, because no message is
• 14:03
  Speaker 1: going to get to your destination before you do, right,
• 14:06
  Speaker 1: So then you just get off the train at the
• 14:08
  Speaker 1: next station, and nobody knows anything is a miss. And
• 14:12
  Speaker 1: then one day in eighteen forty four, a cop in
• 14:16
  Speaker 1: London sees the Fiddler Dick gang strike right, somebody the
• 14:20
  Speaker 1: platform's like, whatever, my wallet, whatever, I don't know. Somebot
• 14:22
  Speaker 1: to stop that boy, and they're on the train and
• 14:24
  Speaker 1: they're gone. But then the cup is like, oh wait
• 14:27
  Speaker 1: a minute, we got a telegraph now, and you're just telegraphs.
• 14:31
  Speaker 1: They head to the next station. Fiddler Dick out of
• 14:35
  Speaker 1: the boys get arrested. Thank you Telegraph. Here's Fiddler Dick.
• 14:38
  Speaker 1: You got Fiddler Dick by the telegraph. So this is
• 14:42
  Speaker 1: the world that Edison is going into. And it means
• 14:48
  Speaker 1: that if you know how to send and receive Morse code,
• 14:52
  Speaker 1: you can write your ticket. It's like being a coder
• 14:54
  Speaker 1: in whatever twenty twenty. What it was the best year
• 14:56
  Speaker 1: to be a coder? Twenty twenty? Probably right.
• 14:58
  Speaker 2: I feel like we should just say here, if Netflix
• 15:00
  Speaker 2: is listening in, we could write the Adventures of Young Edison,
• 15:04
  Speaker 2: telegraph operator, traveling the nation, solving crime, wading inventions. I
• 15:09
  Speaker 2: love it, actually, yes, next time on the Adventures of
• 15:12
  Speaker 2: Young Thomas Edison.
• 15:14
  Speaker 1: Very good it's basically this episode, but with a little
• 15:16
  Speaker 1: more like murder. Well, sure, that's here's a murder.
• 15:20
  Speaker 3: We'll be back in just a minute.
• 15:43
  Speaker 1: Thomas Edison, he's going from town to town, you know,
• 15:47
  Speaker 1: he's in Indianapolis, Memphis, Louisville, and he'll roll into town,
• 15:52
  Speaker 1: get a room with some other telegraph operators, and go
• 15:54
  Speaker 1: to work and make money. And he's spending all his
• 15:56
  Speaker 1: money still experimenting, buying chemicals and stuff to build batteries.
• 16:01
  Speaker 1: And there's this moment in Louisville. Actually his room is
• 16:04
  Speaker 1: above the telegraph office and he spills some acid on
• 16:06
  Speaker 1: the floor and it eats a hole through the floor
• 16:09
  Speaker 1: and drips down into like the boss's office below. So
• 16:12
  Speaker 1: he gets fired, but who cares, right, he's like a
• 16:14
  Speaker 1: teenager and he has this valuable skill. So he winds
• 16:17
  Speaker 1: up eventually in Boston as a telegraph operator. And this
• 16:21
  Speaker 1: is where there's kind of a big turn, the next
• 16:24
  Speaker 1: big turn in his life.
• 16:26
  Speaker 2: So in the classic story of an entrepreneur, right, you
• 16:30
  Speaker 2: need to have the basic skills, you need to have
• 16:32
  Speaker 2: a bunch of ideas, but you also have to sort
• 16:35
  Speaker 2: of take a risk. You have to have that moment
• 16:37
  Speaker 2: of failure before you pivot, and I feel like we're
• 16:40
  Speaker 2: about to get to that.
• 16:41
  Speaker 1: Yes, that's right, both the failure and the pivot. Right.
• 16:44
  Speaker 1: So yeah, So it's eighteen sixty nine. Edison is twenty
• 16:48
  Speaker 1: two years old and he gets his first patent ever,
• 16:52
  Speaker 1: first of one thousand and ninety three patents he will
• 16:54
  Speaker 1: get legend in his lifetime legend and this one for him,
• 16:58
  Speaker 1: it's for an electric vote recorder, right. And so the
• 17:02
  Speaker 1: idea is he's in Boston, which is the state capital
• 17:05
  Speaker 1: of Massachusetts, right, and you know the voting is super inefficient, right,
• 17:11
  Speaker 1: I whatever. The gentleman from whatever, I don't know what, wherever.
• 17:15
  Speaker 2: He sees a he sees a pain point there if
• 17:18
  Speaker 2: someone has to write down eyes and knais.
• 17:20
  Speaker 1: And so he invents this automatic counting machine and takes
• 17:25
  Speaker 1: it to I think it takes it to the state House.
• 17:27
  Speaker 1: He takes it to some legislator, takes it to the
• 17:29
  Speaker 1: you know, customer, and they're like, look, this is very clever,
• 17:33
  Speaker 1: but I'll tell you a little secret. We don't actually
• 17:37
  Speaker 1: want our votes counted instantly, right. We need that time
• 17:39
  Speaker 1: to go talk to the other legislators see if we
• 17:42
  Speaker 1: can sway them. Maybe go out in the lobby and
• 17:44
  Speaker 1: see if any the lobbyists out there want to discuss
• 17:47
  Speaker 1: our campaign contributions or whatever they called them back then. Right,
• 17:51
  Speaker 1: So in fact, this is not a problem. It would
• 17:54
  Speaker 1: it would create a problem for the legislators. They don't
• 17:57
  Speaker 1: want it, nobody buys it. He has built a thing
• 18:00
  Speaker 1: that nobody wants.
• 18:01
  Speaker 2: And this is a classic lesson for entrepreneurs. I mean
• 18:04
  Speaker 2: even today in business school, people will come up with
• 18:06
  Speaker 2: ideas and even make a prototype of it and be like,
• 18:11
  Speaker 2: look at how amazing this idea is. And you'll be like, well,
• 18:14
  Speaker 2: does anyone want it? Did you talk to your customers
• 18:17
  Speaker 2: and like, oh, not yet. But it's clearly genius, so Engavier, right,
• 18:23
  Speaker 2: it's having genius. Yeah, having a genius idea without a
• 18:29
  Speaker 2: need for it is nothing. It's like not having it
• 18:32
  Speaker 2: at all.
• 18:32
  Speaker 1: Yeah. It reminded me of you know why Combinator, the
• 18:36
  Speaker 1: famous startup incubator in Silicon Valley. I think their motto
• 18:40
  Speaker 1: is something like make something people want. And I seem
• 18:44
  Speaker 1: to recall, although I could not find evidence of this
• 18:46
  Speaker 1: when I went to look for it, but I seem
• 18:47
  Speaker 1: to recall that they give entrepreneurs a T shirt if
• 18:50
  Speaker 1: their business gets to some level of success that says, congratulations,
• 18:55
  Speaker 1: you made something people want. It's a very simple, elegant lesson,
• 19:00
  Speaker 1: and it's a lesson that Edison really learns, really internalizes
• 19:05
  Speaker 1: at this point in his life.
• 19:06
  Speaker 2: And we'll see this for the rest of his life
• 19:08
  Speaker 2: when he he interacts with other inventors, right, you know,
• 19:11
  Speaker 2: he's the king inventor, So he's often brought in to.
• 19:13
  Speaker 1: Be like, what do you think about this?
• 19:15
  Speaker 2: And you know, they're showing it off to Edison being like, oh,
• 19:18
  Speaker 2: isn't this amazing? And he's thinking, all right, how much
• 19:21
  Speaker 2: can I get for it? Who will pay a nickel
• 19:23
  Speaker 2: to use this thing? How I get into stores? Like
• 19:25
  Speaker 2: what's the revenue model? Essentially, and this is one of
• 19:29
  Speaker 2: the things that makes him a great inventor and a
• 19:33
  Speaker 2: great businessman.
• 19:34
  Speaker 1: So Edison takes this lesson and he turns to the
• 19:37
  Speaker 1: finance industry smart smart, because finance is just literally the
• 19:41
  Speaker 1: business of money, right, and if you can help people
• 19:44
  Speaker 1: make more money, they will pay you for that. And
• 19:47
  Speaker 1: right around this time, people have started using the telegraph
• 19:50
  Speaker 1: to send real time information about stock prices. This is
• 19:55
  Speaker 1: basically the invention of the stock ticker is a thing
• 19:57
  Speaker 1: that has happened.
• 19:58
  Speaker 2: Which is powerful because if stocks are trading for a
• 20:00
  Speaker 2: different price, let's just say in London, New York, New York, Chicago,
• 20:05
  Speaker 2: then that's this huge opportunity to buy cheap and want
• 20:09
  Speaker 2: place and sell expensive in another place. This arbitrage opportunity.
• 20:13
  Speaker 2: And having that information means you can spot those opportunities exactly.
• 20:18
  Speaker 1: And if you can improve that a little bit, if
• 20:21
  Speaker 1: you can make it faster or clearer, whatever, people will
• 20:24
  Speaker 1: make more money. We saw this even into the twenty
• 20:26
  Speaker 1: first century when people were building crazy, you know, dedicated
• 20:29
  Speaker 1: fiber optic lines and satellite towers and wild things to
• 20:32
  Speaker 1: move price information faster. So Edison moves to New York,
• 20:37
  Speaker 1: of course finance Wall Street and gets a contract from
• 20:41
  Speaker 1: the Golden Stock Telegraph Company of New York City. Really,
• 20:44
  Speaker 1: what does that company do? I love old company names, right,
• 20:47
  Speaker 1: What does the National Biscuit Company make? They make biscuits.
• 20:51
  Speaker 2: I feel like the Golden Stock Telegraph Company became like
• 20:54
  Speaker 2: go Telcom in the eighties and and now is known
• 20:57
  Speaker 2: as Spritzel.
• 20:58
  Speaker 1: Yes, Fritzel, but no I for some reason. And so
• 21:02
  Speaker 1: now Edison is in New York and he is able
• 21:06
  Speaker 1: to stop being a telegraph operator, he's able to do
• 21:09
  Speaker 1: with his job. Start his first company, straightforward name Newark
• 21:13
  Speaker 1: Telegraph Works. Ask me why why was it located in Newark?
• 21:18
  Speaker 1: And what did they work on? Telegraph? He's hiring workers,
• 21:22
  Speaker 1: he delivers that first stock ticker. And he's also he's
• 21:26
  Speaker 1: working on all these incremental improvements, right, like not crazy
• 21:31
  Speaker 1: things that are going to make him famous, but he's
• 21:33
  Speaker 1: just making all these tweaks that give little efficiency gains,
• 21:38
  Speaker 1: you know, little better batteries and weird electrical things. Right.
• 21:43
  Speaker 1: His company's growing. He gets married, married to a Jersey
• 21:46
  Speaker 1: girl named Mary Stillwell, they buy a house. But Edison
• 21:50
  Speaker 1: is definitely not a family man. He's working. He's always
• 21:53
  Speaker 1: working all the time. In fact, in his first year
• 21:55
  Speaker 1: of marriage he gets thirty nine patents, but I'm sure
• 21:58
  Speaker 1: he made it home for dinner never probably zero times.
• 22:03
  Speaker 1: And then in eighteen seventy four he comes up with
• 22:07
  Speaker 1: a big idea. Doesn't sound like a big idea to us,
• 22:11
  Speaker 1: but it is a big idea. It's a system that
• 22:15
  Speaker 1: lets you send four messages at once on a single
• 22:19
  Speaker 1: telegraph line. Calls it the quadruplex.
• 22:22
  Speaker 2: Now, at this point, telegraph was essentially one wire and
• 22:28
  Speaker 2: you basically tap into one side of the wirepp peep
• 22:32
  Speaker 2: person listens on the other end, taps.
• 22:34
  Speaker 1: Back, and the wire is made of copper. Right, it's
• 22:38
  Speaker 1: copper wire. So it's expensive. It's expensive, right, And they're
• 22:41
  Speaker 1: running the copper wire all over the country, you know,
• 22:43
  Speaker 1: across the Atlantic Ocean. Costs a lot of money to
• 22:46
  Speaker 1: run all that copper wire, right, And so if you
• 22:49
  Speaker 1: can get more messages on the same amount of wire,
• 22:54
  Speaker 1: that is a huge efficiency gain, right. That makes things cheaper. Yeah,
• 22:59
  Speaker 1: because it's more efficient. It's something that no one would
• 23:01
  Speaker 1: ever see or notice. But if you're running a company,
• 23:04
  Speaker 1: I mean that is a huge productivity increase. And I
• 23:06
  Speaker 1: want to just like zoom out from this for a moment,
• 23:10
  Speaker 1: because you know, we talk about technology now, we talk
• 23:15
  Speaker 1: about like amazing things and maybe it's scary, like AI
• 23:19
  Speaker 1: or whatever, but it's it's kind of exciting and dramatic.
• 23:22
  Speaker 1: But in the long run, maybe the most important thing
• 23:26
  Speaker 1: that technology does is make stuff cheaper, makes it cheaper
• 23:29
  Speaker 1: to communicate, makes it cheaper to grow food, makes it
• 23:32
  Speaker 1: cheaper to make clothes. And when everything gets cheaper, everybody
• 23:36
  Speaker 1: gets richer. Right. The way we have had material progress
• 23:40
  Speaker 1: is by technology effectively making things cheaper. So shout out
• 23:46
  Speaker 1: to that. And that is what Edison is doing here.
• 23:48
  Speaker 1: He is making the most important communications technology of its
• 23:51
  Speaker 1: stay cheaper.
• 23:52
  Speaker 2: So he's on a roll. He's got dozens of inventions
• 23:55
  Speaker 2: at this point, he's been tweaking. He's finally got something
• 23:57
  Speaker 2: that people are going to pay money for. He's got
• 23:59
  Speaker 2: a family, right, But he's not yet this world changing inventor.
• 24:05
  Speaker 2: Because there's one last piece of the puzzle any entrepreneur needs,
• 24:08
  Speaker 2: and that is scale. He needs money. He needs so
• 24:12
  Speaker 2: much money. There's a special name for it.
• 24:14
  Speaker 1: Capital. Yeah, he needs capital. Like, I don't know at
• 24:17
  Speaker 1: what point does money become capital. I mean, I know
• 24:20
  Speaker 1: you could say it's like the structure of it is it.
• 24:21
  Speaker 1: But I feel like nobody calls one hundred thousand dollars money, right, that's.
• 24:26
  Speaker 2: Not that is investment capital.
• 24:28
  Speaker 1: Yes, yeah, he in fact, at one point writes to
• 24:32
  Speaker 1: the head of Western Union. Western Union is the big
• 24:34
  Speaker 1: telegraph company. He's doing a lot of work for them.
• 24:36
  Speaker 1: He writes to the head of Western Union, I need
• 24:39
  Speaker 1: ten nine, eight, seven, six, five, four, three or two
• 24:42
  Speaker 1: thousand dollars anyone you would like to advance he's actually
• 24:47
  Speaker 1: writing this to that funny it's good, it's charming. He
• 24:50
  Speaker 1: had this kind of homespun charm people talked about like
• 24:53
  Speaker 1: he was from the Midwest. He had that Midwestern charm.
• 24:56
  Speaker 1: Is that a thing? I think it is for Edison?
• 24:57
  Speaker 1: It is dressed in kind of country clothes, even when
• 25:00
  Speaker 1: he was famous. So he's writing this to the head
• 25:02
  Speaker 1: of Western Union, this big executive, William Morton, and in
• 25:05
  Speaker 1: fact Orton advances Edison five thousand dollars and then they
• 25:08
  Speaker 1: start to properly negotiate over Edison's big idea over the quadruplex.
• 25:13
  Speaker 1: Edison wants twenty five thousand plus royalties. Orton, you know,
• 25:17
  Speaker 1: controls Western Union can kind of do whatever he wants.
• 25:20
  Speaker 1: So he's sort of I think playing games with Edison, stalling.
• 25:23
  Speaker 1: He goes off to the Midwest for Christmas break, and
• 25:26
  Speaker 1: Edison is just has to kind of wait around, right,
• 25:28
  Speaker 1: has to wait for his big capital infusion. One day,
• 25:31
  Speaker 1: as this is happening, into Edison's little Newark, New Jersey, workshop,
• 25:38
  Speaker 1: walks Jay Gould.
• 25:41
  Speaker 2: Jay Gould legendary. He was a railroad magnet, a big
• 25:46
  Speaker 2: financial speculator. O't call him investor, I'm calling him a speculator.
• 25:50
  Speaker 2: He was a classic robber baron. But more than that,
• 25:52
  Speaker 2: you know, there was this whole robber barons they called him. Right,
• 25:55
  Speaker 2: everybody you know thought, oh, they're stealing all our money,
• 25:58
  Speaker 2: they're manipulating the markets. But even the robber barons hated
• 26:02
  Speaker 2: Jay Gould. He was a robber barons, robber baron. Now
• 26:05
  Speaker 2: I will say I've toured his mansion recently up on
• 26:08
  Speaker 2: the Highs and River, and the tour guys say he
• 26:11
  Speaker 2: was misunderstood. He was actually a really great guy. But
• 26:14
  Speaker 2: we'll do a future episode. It's a very nice manchion.
• 26:17
  Speaker 1: Yeah. Yeah. Even at the time, right, even at the time,
• 26:20
  Speaker 1: people was like the he.
• 26:21
  Speaker 2: Was always trying to corner the market, like like take
• 26:24
  Speaker 2: all the gold contract.
• 26:25
  Speaker 1: I tried to corner gold stuff stuff like that.
• 26:29
  Speaker 2: Some economists have argued that he was hated because he
• 26:33
  Speaker 2: went against big company interests and in fact things got
• 26:38
  Speaker 2: cheaper because of him.
• 26:38
  Speaker 1: But we will look at this in the future show.
• 26:40
  Speaker 1: Robert bart who is in it for the little guy.
• 26:42
  Speaker 1: He was going to give that mansion to the poor someday,
• 26:45
  Speaker 1: you know. To be continued. He walks in, this guy,
• 26:48
  Speaker 1: this famous guy walks into Edison's little shop, and Gold actually,
• 26:52
  Speaker 1: among other things, controls the Atlantic and Pacific Telegraph Company.
• 26:56
  Speaker 1: Arrival to Western Union, Jay Gold has heard about the quadruplex,
• 27:01
  Speaker 1: and if you're Edison, it is great news when Jay
• 27:05
  Speaker 1: Gold walks in the door. Right. It's like that Seven
• 27:08
  Speaker 1: Bugs Bunny when Bug Funny looks at a guy and
• 27:10
  Speaker 1: the whole guy is just a big bag with a
• 27:12
  Speaker 1: dollar sign on it. Right, Because if Western Union is
• 27:15
  Speaker 1: all you have, if the head of Western Union is
• 27:18
  Speaker 1: jerking around and going off for Christmas break and not
• 27:21
  Speaker 1: giving you any money, you don't have any leverage. Right,
• 27:22
  Speaker 1: You basically have to just take what they offer. But
• 27:25
  Speaker 1: now now there are multiple buyers for what you're selling.
• 27:29
  Speaker 1: Now there are multiple buyers for your quadruplex, and you
• 27:32
  Speaker 1: have leverage. And so the very next day Edison goes
• 27:37
  Speaker 1: to Gould's mansion on Fifth Avenue in Manhattan, goes down
• 27:41
  Speaker 1: to Gould's office in the basement, and Edison actually wrote
• 27:44
  Speaker 1: about this exchange later. Edison wrote, Here's what he wrote.
• 27:49
  Speaker 1: Gould started in at once and asked me how much
• 27:51
  Speaker 1: I wanted. I said, make me an offer. Then he said,
• 27:54
  Speaker 1: I'll give you thirty thousand dollars and I said, I'll
• 27:57
  Speaker 1: sell any interest I may have for that money, which
• 28:00
  Speaker 1: was somewhat more than I thought I could get.
• 28:02
  Speaker 2: Great negotiating lesson always let the other guy say the
• 28:06
  Speaker 2: number first, because right, if it's more than you wanted, you.
• 28:10
  Speaker 1: Just say yes. You just say yes, thank you, pleasure
• 28:13
  Speaker 1: doing business with you. So then of course Edison gets
• 28:15
  Speaker 1: the money. Gold actually sells a yacht and gives Edison
• 28:18
  Speaker 1: the money from the yacht. Lovely Robert Baron detail, and
• 28:22
  Speaker 1: then of course Western Union sues Gould over ownership of
• 28:25
  Speaker 1: the quadrupleags. The lawsuit goes on forever. Edison's inventions are
• 28:28
  Speaker 1: going to end up tied up in lawsuits again and again, right,
• 28:31
  Speaker 1: intellectual property story. But Edison doesn't care this time because
• 28:34
  Speaker 1: he's got his money. What does he do with it?
• 28:37
  Speaker 1: He does the most important thing he's ever going to
• 28:40
  Speaker 1: do in his life. He knew it. He does the
• 28:43
  Speaker 1: thing that is going to transform the very nature of
• 28:46
  Speaker 1: invention itself itself in the world. And what that thing
• 28:50
  Speaker 1: is is he moves to the country. He moves to
• 28:54
  Speaker 1: this little failed housing development out in the middle of
• 28:57
  Speaker 1: nowhere in New Jersey called Menlo Park, next to the railroad,
• 29:02
  Speaker 1: between New Jersey and Philadelphia. So it's early eighteen seventy six.
• 29:06
  Speaker 1: By this point, Edison is twenty nine years old. He's
• 29:09
  Speaker 1: got two kids who he calls Dot and Dash. Oh yeah,
• 29:13
  Speaker 1: very sweet, although it's not like he hangs out with them.
• 29:16
  Speaker 1: What he actually loves is the telegraph. His family moves
• 29:19
  Speaker 1: into this big house that used to be the sales
• 29:21
  Speaker 1: office for this failed housing development in Melo Park, some
• 29:24
  Speaker 1: of his workers move into some of the other empty houses,
• 29:28
  Speaker 1: and then on top of this little hill not far
• 29:31
  Speaker 1: from the train station. I think you can see Manhattan
• 29:34
  Speaker 1: from the top of the hill, not sure. On top
• 29:36
  Speaker 1: of this little hill, he builds the thing, the main
• 29:39
  Speaker 1: thing that is like the manifestation of his big idea.
• 29:44
  Speaker 1: It's a lab. It's a lab for him and his
• 29:46
  Speaker 1: employees where they're going to work. And he says, in
• 29:48
  Speaker 1: this building he is going to come up with quote
• 29:51
  Speaker 1: a minor invention every ten days and a big thing
• 29:55
  Speaker 1: every six months or so.
• 29:56
  Speaker 2: It's amazing because if you would ask most people at
• 29:59
  Speaker 2: this time, if you ask most people today, they would say,
• 30:01
  Speaker 2: invention is one of those things that you know comes
• 30:03
  Speaker 2: from God or the greater spirit, you know, the eureka moment,
• 30:07
  Speaker 2: you know, and everyone's he is like, oh, it was
• 30:10
  Speaker 2: out walking when it suddenly came to me fully formed,
• 30:13
  Speaker 2: Like this is the myth of invention, and maybe it
• 30:16
  Speaker 2: happens sometimes this way. But for Thomas Edison to say, yeah,
• 30:19
  Speaker 2: we got a schedule here, we got a calendar like invent, invent, invent.
• 30:23
  Speaker 1: It's taking away the magic, right, It's taking it from
• 30:26
  Speaker 1: this kind of romantic world to the industrial world.
• 30:29
  Speaker 2: And you didn't maybe know if it was possible, but
• 30:31
  Speaker 2: it ended up being possible.
• 30:33
  Speaker 1: So what he builds there is a long, two story
• 30:37
  Speaker 1: wood building one hundred feet long twenty five feet wide,
• 30:41
  Speaker 1: painted white. People say it looks like a schoolhouse or
• 30:44
  Speaker 1: a church without a steeple. And on the ground floor
• 30:47
  Speaker 1: there's a machine shop. Upstairs there's a lab. Eventually people
• 30:51
  Speaker 1: will call this the invention Factory, which is a perfect
• 30:54
  Speaker 1: name for it, but right now nobody calls it anything, right,
• 30:58
  Speaker 1: because nobody outside the telegraph industry has even heard of
• 31:01
  Speaker 1: Thomas Edison. He's just some guy moving out to the
• 31:03
  Speaker 1: middle of nowhere.
• 31:04
  Speaker 2: I've seen a replica of this lab in Michigan outside Detroit,
• 31:08
  Speaker 2: in Ford's Museum. He so admired Thomas Edison that he
• 31:13
  Speaker 2: rebuilt the laboratory down to like the test tubes and
• 31:17
  Speaker 2: the little bits of wire on the wall. Apparently so
• 31:20
  Speaker 2: my tour guy told me. When Edison saw it, he's like,
• 31:23
  Speaker 2: it's an exact replica. I accept it so clean, you know,
• 31:26
  Speaker 2: it was like perfectly clean. But there's a million little
• 31:30
  Speaker 2: things and screws and connectors and all sorts of fabrics
• 31:35
  Speaker 2: and that sort of thing. In case Thomas Edison or
• 31:38
  Speaker 2: his people at this point had an idea, they didn't
• 31:41
  Speaker 2: have to go to Manhattan to pick up.
• 31:43
  Speaker 1: A button or a part or anything. Right, the core
• 31:46
  Speaker 1: thing this place does is it makes Edison's inventing process frictionless. Right,
• 31:53
  Speaker 1: anytime he thinks of something, he has right there standing
• 31:57
  Speaker 1: next to him, you know, skilled machinists and electricians and
• 32:01
  Speaker 1: like all the parts and machines and chemicals and whatever
• 32:04
  Speaker 1: you can think of. This is the breakthrough. There's this
• 32:09
  Speaker 1: great quote about this from this guy, Paul Israel. He
• 32:11
  Speaker 1: wrote a biography about Edison. He spent decades editing the
• 32:16
  Speaker 1: Edison papers at records. He's like a deep Edison scholar.
• 32:20
  Speaker 1: And the quote is that the lab in Menlo Park
• 32:23
  Speaker 1: showed that invention itself could be an industrial process. So
• 32:28
  Speaker 1: like this is the great era of industrialization in America
• 32:31
  Speaker 1: and Edison is industrializing invention.
• 32:35
  Speaker 2: He's gone from Thomas Edison Young Morse code operator to
• 32:39
  Speaker 2: Thomas Edison inventor, to Thomas Edison Incorporated. He's the guy
• 32:43
  Speaker 2: who runs the factory that makes inventions. And in just
• 32:47
  Speaker 2: a minute we will hear how the invention factory comes out.
• 32:51
  Speaker 4: Of the gate with a big one.
• 33:16
  Speaker 2: Jacob, I feel like the pieces are in place. Edison
• 33:18
  Speaker 2: has his invention side, his business side, he's got money,
• 33:22
  Speaker 2: he's got the industrialization of invention itself, he has the
• 33:26
  Speaker 2: manifestation of his own mind on a hilltop in New Jersey.
• 33:31
  Speaker 2: And yet no mention of the light bulb or are
• 33:34
  Speaker 2: these things that like every elementary school student knows about
• 33:37
  Speaker 2: Thomas Edison.
• 33:37
  Speaker 1: It's coming, Okay, it's coming, though it comes in an
• 33:41
  Speaker 1: indirect way. It comes in a really interesting way. And
• 33:43
  Speaker 1: that is this. So right around the time Edison moves
• 33:46
  Speaker 1: to Memo Park, there is in fact this historic breakthrough,
• 33:50
  Speaker 1: but it doesn't come from Edison, doesn't come from his
• 33:53
  Speaker 1: lab on the hill. It comes from another inventor who's
• 33:56
  Speaker 1: based in Boston, and this invention is granted as patent
• 34:01
  Speaker 1: one seven four four sixty five, and it's called improvement
• 34:05
  Speaker 1: in telegraphy Yon wait for it. The inventor says, my
• 34:10
  Speaker 1: present invention consists of a vibratory or undulatory current of
• 34:13
  Speaker 1: electricity in contradistinction to a merely intermittent or postulator current.
• 34:18
  Speaker 1: And essentially, this inventor says, this is a breakthrough because
• 34:21
  Speaker 1: you can send more telegraph messages down the same wire,
• 34:24
  Speaker 1: so it's like quadruplex plus. But then at the very
• 34:29
  Speaker 1: end of the application, literally second to last paragraph, the
• 34:32
  Speaker 1: inventor writes that the patent covers quote the method of
• 34:36
  Speaker 1: and apparatus four transmitting vocal or other sounds telegraphically as
• 34:41
  Speaker 1: herein described by causing electrical undulations similar in forms of
• 34:46
  Speaker 1: the vibrations of air accompanying the said vocal or other
• 34:49
  Speaker 1: sound substantially as set forth. And then last paragraph in testimony,
• 34:54
  Speaker 1: whereof I have here unto signed my name this twentieth
• 34:58
  Speaker 1: day of January eighty, eighteen seventy six.
• 35:02
  Speaker 2: Alex Graham Bell Alexander Graham Bell, I love it. I
• 35:07
  Speaker 2: love it when you're in reading the famous biography and
• 35:10
  Speaker 2: another famous guy comes in.
• 35:11
  Speaker 1: Yeah, came up, Alexander graand Belt Watson come here. I
• 35:14
  Speaker 1: want you. Alexander Grambell. He is inventing the telephone right here,
• 35:19
  Speaker 1: and he doesn't know it, right, amazing. He just thinks
• 35:22
  Speaker 1: he's like coming up with a better way to send telegraphs.
• 35:24
  Speaker 2: And does Edison see this in like Telegraph Weekly or
• 35:27
  Speaker 2: something like that.
• 35:28
  Speaker 1: And so Edison at tracks new patents. That's like one
• 35:30
  Speaker 1: of the things he does is he just sees all
• 35:32
  Speaker 1: the new patents that come out. He reads them and
• 35:35
  Speaker 1: he sees this, and he thinks, I'm gonna tweak it
• 35:39
  Speaker 1: so I can send even better telegraph messages. And you know,
• 35:44
  Speaker 1: he's all set up to do this, right, He's got
• 35:46
  Speaker 1: his muckers, he's got his lab, he's staying up all night.
• 35:50
  Speaker 1: And there's this one piece of this new thing that
• 35:54
  Speaker 1: Alexander Grambell has invented called the diaphragm. It's the thing
• 35:58
  Speaker 1: that turns sound into vibrations, right, So it vibrates when
• 36:02
  Speaker 1: sound waves hit that's a thin membrane.
• 36:04
  Speaker 2: It vibrates and it creates an electrical current that is
• 36:07
  Speaker 2: not dots or dashes, but is variable electric current.
• 36:10
  Speaker 1: Yes, and going the other way, it turns the electric
• 36:12
  Speaker 1: current into vibrations that you can hear. And so one
• 36:17
  Speaker 1: day Edison is playing with one of these and just
• 36:19
  Speaker 1: like talking into it, and he feels that it's vibrating
• 36:23
  Speaker 1: on his hand. As he talks to it, he can
• 36:24
  Speaker 1: feel the vibrations. It's the middle of the night. He's
• 36:27
  Speaker 1: having dinner with his boys, with his muckers, probably eating
• 36:31
  Speaker 1: apple pie. And as he feels this thing vibrating on
• 36:35
  Speaker 1: his hand, he turns to his chief engineer, this assistant
• 36:40
  Speaker 1: named Charles Bachelor guy, he calls Batch, and he says,
• 36:43
  Speaker 1: you know, Batch, if we took one of these diaphragms
• 36:46
  Speaker 1: and we put something pointy, put like a needle or
• 36:48
  Speaker 1: something on the bottom of it, and put it on
• 36:52
  Speaker 1: a piece of paper and talked into it, it would
• 36:54
  Speaker 1: scratch the paper. It would leave scratch marks on the paper.
• 36:58
  Speaker 1: And then maybe if we took that paper with the
• 37:01
  Speaker 1: scratch marks and pulled it back under the needle, would
• 37:05
  Speaker 1: it make the diaphragm vibrate and send sound back out?
• 37:09
  Speaker 1: Would it recreate the sound?
• 37:10
  Speaker 2: And because they have a factory with needles and paper
• 37:13
  Speaker 2: and diaphragms and all this stuff, they don't need to
• 37:15
  Speaker 2: wait long to know the answer to this question.
• 37:17
  Speaker 1: They don't need to wait at all. Right, all the
• 37:19
  Speaker 1: dudes in the middle of the night, in the middle
• 37:21
  Speaker 1: of nowhere in New Jersey are sitting there ready to go,
• 37:24
  Speaker 1: and so they just do it, right, this whole team
• 37:27
  Speaker 1: of people. There's a machinist who's sitting there, who walks
• 37:29
  Speaker 1: over to his whatever machine and like, solder is a
• 37:33
  Speaker 1: needle onto the bottom of a diaphragm, or however you
• 37:35
  Speaker 1: get a needle onto the bottom of a diaphragm, and
• 37:37
  Speaker 1: Bach Bachelor gets some wax paper and cuts it up,
• 37:40
  Speaker 1: and they build a little wheel, a little system just
• 37:42
  Speaker 1: right then, right that night, and you know, presumably this
• 37:46
  Speaker 1: is every night, right, presumably it's always like Edison's like,
• 37:50
  Speaker 1: how about this? How about that? And most of them
• 37:52
  Speaker 1: are not very good ideas, but this one, this one
• 37:55
  Speaker 1: is a good idea. Right. So they hook up the
• 37:56
  Speaker 1: diaphragm with the needle, so it's touching the wax paper,
• 38:00
  Speaker 1: and there's this wheel that the paper's on, and so
• 38:03
  Speaker 1: Bachelor slowly pulls the paper along the wheel under the needle,
• 38:08
  Speaker 1: and Edison says, into the diaphragm, Mary had a little lamb,
• 38:16
  Speaker 1: And they take the paper out and they look at
• 38:18
  Speaker 1: it and it has these little scratch marks on it, grooves,
• 38:21
  Speaker 1: if you will. And then bachelor puts the paper back
• 38:25
  Speaker 1: on the wheel with the little scratches, you know, pulls
• 38:27
  Speaker 1: the paper under the needle past the diaphragm, and as
• 38:31
  Speaker 1: it's going past the diaphragm, they hear like, er uh damn, eureka.
• 38:40
  Speaker 1: This is a real eureka. Yeah, this is a real eureka. Right,
• 38:43
  Speaker 1: Like it's not perfect, right, it doesn't quite work, but
• 38:46
  Speaker 1: it works. It works. Edison writes in his notebook that day. Basically,
• 38:52
  Speaker 1: this is an invention that will make it easier for
• 38:54
  Speaker 1: people at the telegraph office to transcribe messages.
• 38:57
  Speaker 2: Oh no, oh no, he's still thinking telegraph. His mind's
• 39:01
  Speaker 2: in the telegraph. He's thinking, oh, yeah, someone in a
• 39:03
  Speaker 2: telegraph office has to use a pencil and paper to
• 39:05
  Speaker 2: write things down. We could use this new transcription device
• 39:11
  Speaker 2: essentially for dots and dashes.
• 39:12
  Speaker 1: Yes, yes, huh. He is still he is still in
• 39:15
  Speaker 1: the world that he's living in, right, Surprisingly, he is
• 39:18
  Speaker 1: still in his world. But he gets he gets that
• 39:20
  Speaker 1: this thing is gonna be big, not to the exclusion
• 39:24
  Speaker 1: of everything else. He keeps puttering on other things, but
• 39:26
  Speaker 1: he does have somebody over the next few months make
• 39:28
  Speaker 1: a list of possible names for his new invention. I
• 39:31
  Speaker 1: know you love a list. You want to take this one,
• 39:33
  Speaker 1: all right?
• 39:34
  Speaker 2: Possible names for this new invention. Autophone, cosmophone, I do
• 39:39
  Speaker 2: like that one. Acoustaphone, nice and tipophone, liquophone, chronophone, glottophone,
• 39:46
  Speaker 2: that's nice, clangophone, who laghamophone, aerophone. I feel like they
• 39:51
  Speaker 2: have a Latin dictionary there in the Park laboratory.
• 39:54
  Speaker 1: There's like going through it. Epigraph They don't choose any
• 39:59
  Speaker 1: of those. Nope, as we know, they choose phonograph, which
• 40:02
  Speaker 1: I think is Edison's and means something like sound writer.
• 40:07
  Speaker 1: Right the graph the graph is right there in the name,
• 40:10
  Speaker 1: which is telling they're really still focused on this kind
• 40:13
  Speaker 1: of automatic transcription part. They're not thinking music.
• 40:17
  Speaker 2: They're not thinking orchestras that someone's going to buy this
• 40:20
  Speaker 2: at home. No.
• 40:21
  Speaker 1: I mean, if anything, they're thinking like when they think
• 40:24
  Speaker 1: beyond telegraph, they think of like, oh, this is like
• 40:27
  Speaker 1: a something that business people can dictate letters into. It's
• 40:31
  Speaker 1: very much like a recording device as opposed to a
• 40:34
  Speaker 1: playing device at some level. So they're working on it
• 40:37
  Speaker 1: they're you know, iterating, they're making it a little better.
• 40:40
  Speaker 1: And a few months later, in December, they decide they're
• 40:44
  Speaker 1: ready to go public with this idea, and it comes
• 40:47
  Speaker 1: out in Scientific American, which was a big, big deal
• 40:50
  Speaker 1: at the time in that sort of technology.
• 40:52
  Speaker 2: Sure, and the story is called the Talking Phonograph, and
• 40:55
  Speaker 2: I'll read a little bit of it. Mister Thomas A.
• 40:58
  Speaker 2: Edison recently came into this office, placed a little machine
• 41:01
  Speaker 2: on our desk and turned to crank, and the machine
• 41:04
  Speaker 2: inquired as to our health, asked how we liked the phonograph,
• 41:09
  Speaker 2: informed us that he was very well, and but us
• 41:11
  Speaker 2: a cordial good night.
• 41:12
  Speaker 1: People now went bananas. People could not believe that this
• 41:19
  Speaker 1: was a thing.
• 41:20
  Speaker 2: It's hard to imagine how big it is that a
• 41:23
  Speaker 2: mechanical machine is doing.
• 41:27
  Speaker 1: What a human does. Yeah, that it talks to use
• 41:30
  Speaker 1: to you like a person. In fact, a professor who
• 41:33
  Speaker 1: reads this article writes to Edison and basically says, like,
• 41:36
  Speaker 1: mister Edison, I'm sure you're an honorable man. You need
• 41:39
  Speaker 1: to correct this article because it makes it sound like
• 41:42
  Speaker 1: you have a machine that can record sound and play
• 41:44
  Speaker 1: it back, and surely, as we all know, that is
• 41:46
  Speaker 1: not possible.
• 41:47
  Speaker 2: It's the kind of thing you'd see at a carnival
• 41:49
  Speaker 2: in the day, right, the box that streaks, and it's
• 41:52
  Speaker 2: a small child or something inside the box put you know,
• 41:56
  Speaker 2: a bunch of hocum.
• 41:57
  Speaker 1: But you know it was magic. I mean it was magic.
• 42:00
  Speaker 1: It was magic. It was magic. He takes it down
• 42:02
  Speaker 1: to Washington, d C. At this big like scientific meeting,
• 42:06
  Speaker 1: and so many people want to hear it that they
• 42:07
  Speaker 1: actually have to take the door off the hinges of
• 42:10
  Speaker 1: the room where he's displaying it. While he's down there
• 42:14
  Speaker 1: the White House, he hears that the president wants to
• 42:17
  Speaker 1: see his new machine. Pop quiz Robert who is the
• 42:20
  Speaker 1: president in eighteen seventy seven seventy eight Garfield Rutherford behays, oh, class,
• 42:27
  Speaker 1: I wouldn't have got it, Classic Lake, you're on.
• 42:30
  Speaker 2: Rutherford behays the things you don't know?
• 42:31
  Speaker 1: Things I didn't know. And Rutherford behayes loves the phonograph.
• 42:35
  Speaker 1: He keeps Edison at the White House like till after
• 42:38
  Speaker 1: midnight playing with this incredible thing. And this is the
• 42:41
  Speaker 1: moment when Edison goes from being you know, inventor known
• 42:47
  Speaker 1: in the telegraph business to being a celebrity. This is
• 42:51
  Speaker 1: the moment when he becomes known as the Wizard of
• 42:53
  Speaker 1: Memo Park.
• 42:54
  Speaker 2: Because this is a leap in technology. It's not just
• 42:58
  Speaker 2: a little extra something to make telegraph operators more money.
• 43:01
  Speaker 2: This wasn't just the front page of Telegraph weekly. This
• 43:04
  Speaker 2: is the front page of the New York World.
• 43:06
  Speaker 1: Yeah, and you know, I think there's something something about
• 43:11
  Speaker 1: the human voice is important here. Like you know, obviously
• 43:14
  Speaker 1: there had been portraits and people had had their writings,
• 43:17
  Speaker 1: but the voice is connected to the breath, right, It
• 43:19
  Speaker 1: is ephemeral, It dies with you. And like immediately when
• 43:23
  Speaker 1: this comes out, people are thinking about like, oh, this
• 43:26
  Speaker 1: machine is going to let people talk to us after
• 43:29
  Speaker 1: they die, as if they're talking to us from beyond
• 43:33
  Speaker 1: the grave. This is it's almost supernatural.
• 43:36
  Speaker 2: So how does he take something that is magic and
• 43:39
  Speaker 2: make money off of it?
• 43:40
  Speaker 1: This is a great question. So he is not yet
• 43:43
  Speaker 1: to the point where they can manufacture these at any
• 43:47
  Speaker 1: kind of scale and sell them for a profit. That's
• 43:49
  Speaker 1: the obvious thing you would do. Yeah, but the sort
• 43:51
  Speaker 1: of minimum viable product version of it. They just got
• 43:56
  Speaker 1: a couple of phonographs. They rent out rooms, sell tickets
• 44:00
  Speaker 1: and people pay to come and hear somebody like record
• 44:04
  Speaker 1: themselves singing and then play it back.
• 44:06
  Speaker 2: I would totally pay that nickel you would pay it today?
• 44:09
  Speaker 1: I would probably we probably did so. Obviously, this is
• 44:16
  Speaker 1: just kind of a stalling maneuver, right, This is just
• 44:18
  Speaker 1: what they're doing until the business gets up and running
• 44:21
  Speaker 1: and there are investors in the Edison Speaking Phonograph Company
• 44:24
  Speaker 1: and they're like, Okay, Edison, let's let's get to scale here,
• 44:28
  Speaker 1: let's figure out how to manufacture this. And it turns
• 44:32
  Speaker 1: out this is not Edison's thing. Edison's thing is not
• 44:37
  Speaker 1: taking his genius invention and operationalizing and building the factory
• 44:41
  Speaker 1: to build it. You know, he has his invention factory.
• 44:44
  Speaker 1: He starts working on the telescope of phone, his big
• 44:48
  Speaker 1: idea for how people I'm like, whatever, hilltops a mile
• 44:50
  Speaker 1: apart can talk.
• 44:51
  Speaker 3: To each other.
• 44:52
  Speaker 1: It's amazing. Right.
• 44:53
  Speaker 2: He doesn't want to be in the business of like
• 44:55
  Speaker 2: hiring orchestras and pressing like music and distributing this through
• 45:00
  Speaker 2: music stores. I mean, that's just like being a businessman
• 45:03
  Speaker 2: that's not coming up with cool stuff.
• 45:05
  Speaker 1: All. Yeah, that's not his thing, but it does mean
• 45:07
  Speaker 1: he leaves the phonograph by the way side for years
• 45:10
  Speaker 1: and several years later, Alexander Graham Bell him again actually
• 45:16
  Speaker 1: improves on Edison's idea for the phonograph, brings it to market,
• 45:20
  Speaker 1: and this is the wax cylinder. Yeah. He eventually Alexander
• 45:23
  Speaker 1: Grahm Bell is eventually the one who comes up with
• 45:25
  Speaker 1: the wax cylinder. Yes, and that does inspire Edison many
• 45:28
  Speaker 1: years later to sort of follow right to chase Alexander
• 45:32
  Speaker 1: Graham Bell. And Edison does wind up in the phonograph business,
• 45:36
  Speaker 1: but he's always behind, ironically, given that he invented it.
• 45:39
  Speaker 1: Like his other inventions, he's much less clearly the inventor
• 45:42
  Speaker 1: the ones they're coming, but this one is him unambiguously
• 45:45
  Speaker 1: and yet and yet he never dominates the industry as
• 45:51
  Speaker 1: arguably he should have. And then finally, in nineteen twenty nine,
• 45:55
  Speaker 1: two years before he dies, he just gets out of
• 45:57
  Speaker 1: the phonograph business altogether, gives up. He's got bigger things.
• 46:01
  Speaker 1: So what do we make of this story? Jacob?
• 46:03
  Speaker 2: At the very beginning, we promised that Edison wasn't just
• 46:07
  Speaker 2: an inventor, He's an entrepreneur's business man.
• 46:09
  Speaker 1: And yet, so far.
• 46:11
  Speaker 2: I have been in front of our actual episode. But
• 46:14
  Speaker 2: so far he doesn't seem to be squeezing every last time.
• 46:19
  Speaker 2: He doesn't seem to have that ruthless businessman in him.
• 46:22
  Speaker 1: Yeah, no, that's true. You definitely would not call him
• 46:25
  Speaker 1: a profit maximizer, right. He sort of reminds me of
• 46:29
  Speaker 1: of this type of founder you see with startups now,
• 46:32
  Speaker 1: where they're like brilliant and driven and they create this
• 46:36
  Speaker 1: very innovative company and get it going and then like
• 46:40
  Speaker 1: a year or two in, somebody from the you know,
• 46:43
  Speaker 1: venture capital firm, takes him into a back room and
• 46:45
  Speaker 1: gray hairs. Yeah, the gray hair comes in. Listen, we
• 46:48
  Speaker 1: love you. You've got a great job getting this company
• 46:51
  Speaker 1: off the ground. But now it's time to bring in
• 46:53
  Speaker 1: I'm not gonna call it a grown up, but let's
• 46:55
  Speaker 1: bring in somebody who's more into operations. Right. Edison is
• 46:58
  Speaker 1: kind of like that founder.
• 47:00
  Speaker 2: He could have been the greatest telegraph operator in the world.
• 47:03
  Speaker 2: He could have been the greatest telegraph maximizer in the world.
• 47:07
  Speaker 2: He could have been the phonograph nant and run orchestras
• 47:10
  Speaker 2: around the country and recorded them and sold them all
• 47:13
  Speaker 2: the first David Geffen And maybe he knows himself well
• 47:15
  Speaker 2: enough to know that he has a lot of different interests, right,
• 47:19
  Speaker 2: He's almost like, I wouldn't say scatterbrain because that seems
• 47:23
  Speaker 2: like an insult. It's like things are just coming constantly
• 47:27
  Speaker 2: into his head. You know, at one moment, he's showing
• 47:29
  Speaker 2: a phonograph to the President of the United States, But
• 47:31
  Speaker 2: as he's showing the photograph, he's probably thinking, you know
• 47:33
  Speaker 2: what if you had a giant tube on top of
• 47:37
  Speaker 2: a mountain that you could yell at other mountains with
• 47:41
  Speaker 2: other twoes.
• 47:42
  Speaker 1: And Retherford behazes's like, what what are you talking about?
• 47:44
  Speaker 2: I just want you've already done the thing, right, But
• 47:48
  Speaker 2: that was an actual thing he wanted to do right.
• 47:51
  Speaker 1: Yeah, if he had been this sort of more narrow
• 47:54
  Speaker 1: minded prophet maximizer, he probably would have got stuck at
• 47:59
  Speaker 1: like a sort of local maximum right, Like, maybe he
• 48:01
  Speaker 1: would have stopped at the photograph and be like, I'm famous,
• 48:04
  Speaker 1: I'm the phonograph guy. I'm gonna be the phonograph king now.
• 48:08
  Speaker 1: But this is clearly not what Edison had set out
• 48:11
  Speaker 1: to do, right. He had set out to create an
• 48:14
  Speaker 1: invention factory, a place where he can chase his curiosity,
• 48:18
  Speaker 1: a place where he has all the equipment he needs,
• 48:20
  Speaker 1: and he has this team and a place crucially where
• 48:23
  Speaker 1: he can keep coming up with big ideas one after another,
• 48:26
  Speaker 1: and he is gonna succeed at that.
• 48:28
  Speaker 2: Yeah, inventing the photograph from most people would have been
• 48:31
  Speaker 2: the big thing, but one great product is fine. But
• 48:38
  Speaker 2: transforming a whole system, right, transformative technology, the kind of
• 48:43
  Speaker 2: technology that makes everything change. That's what's about to come.
• 48:50
  Speaker 2: We should thank Thomas Edison for his scatterbrain nature. Yeah,
• 48:54
  Speaker 2: and for his ambition, right. His ambition was not to
• 48:57
  Speaker 2: be the phonograph king. It was to invent greater and
• 49:00
  Speaker 2: greater things. And really, interestingly, like his whole life, he
• 49:03
  Speaker 2: keeps thinking, the next thing I invent is gonna be
• 49:07
  Speaker 2: even bigger. He keeps saying that, even to the point
• 49:10
  Speaker 2: where he's wrong, right, because that's just who he is.
• 49:13
  Speaker 1: He keeps trying to invent bigger and better things.
• 49:18
  Speaker 2: Next time on Business History, Thomas Alva Edison, age thirty
• 49:22
  Speaker 2: or so, he's still so young, gets bored with the
• 49:24
  Speaker 2: phonograph and builds the first big electric grid in the
• 49:28
  Speaker 2: history of the world and reveals that the great inventor
• 49:32
  Speaker 2: has a fatal flaw. He falls to in love with
• 49:36
  Speaker 2: his products. Our showrunner is Ryan Dilly, Our producer is
• 49:40
  Speaker 2: Gabriel Hunter Chang.
• 49:41
  Speaker 1: And our engineer is Sarah Bruguer. I'm Jacob Goldstein.
• 49:44
  Speaker 2: I'm Robert Smith. We'll be back next week with another
• 49:46
  Speaker 2: episode of Business History, a show about the history of business.