From OnePlus to Nothing: Carl Pei's Journey in Building a Tech Empire

Carl Pei, the visionary behind the successful smartphone brand Nothing, has achieved remarkable growth in just two years, reaching $600 million in annualized revenue. His journey into the tech world began with a childhood fascination for gadgets, leading him to co-found OnePlus, a company that redefined the smartphone market. However, Pei felt the industry had lost its spark, prompting him to embark on a new venture focused on user experience and stylish design.

From Gadget Fan to Tech Pioneer

Pei's passion for technology started early. As a kid in Sweden, he was an early adopter of devices like the iPod and the first iPhone. The innovative spirit of early Apple products deeply inspired him. A broken iPod after its warranty expired sparked a realization about product longevity and customer experience. This led him to discover Chinese electronics brands, like Meizu, which impressed him with their quality and design. He even built a fan community around one of these brands, which eventually led to a job offer in China.

The Genesis of OnePlus

In 2011, Pei moved to China, where he learned the intricacies of hardware manufacturing. He was approached by Oppo, a company he admired, but soon learned of their plan to launch a new brand targeting the online market. This new venture, OnePlus, aimed to combine Oppo's manufacturing strengths with a direct-to-consumer online sales model. Pei, then just 24, took the reins for international markets, a segment Oppo had not yet focused on. Since Google's services weren't available in China, they collaborated with Cyanogen, a custom ROM community that had recently become a company, to power their international devices.

The Birth of Nothing

After a successful tenure at OnePlus, Pei took a break, but the desire to create something new quickly resurfaced. He found that a long holiday felt empty without a sense of contribution. Returning to Stockholm, he connected with local entrepreneurs who guided him on raising capital. The initial idea for Nothing wasn't fully formed; Pei admits his early pitch deck was weak, primarily driven by a desire to apply his OnePlus learnings. The challenge of hardware manufacturing became apparent early on, as raising the substantial capital needed for a smartphone and securing manufacturing partners like Foxconn proved difficult. Many factories had experienced losses with previous tech startups and were hesitant to take on new ventures.

Overcoming Hardware Hurdles: The Earbuds Strategy

Facing skepticism from manufacturers, Pei and his team decided to launch with a smaller, yet still complex, product: earbuds. This strategy aimed to build credibility and demonstrate their manufacturing capabilities. However, even with earbuds, they faced rejection from factories unwilling to work with a new, unproven brand. They eventually found a factory on the brink of bankruptcy, which agreed to partner with them. The initial production run was fraught with issues, with 90% of the first batch of earbuds failing to charge due to a faulty spring mechanism. Pei's team responded by deploying engineers directly to the factory floor to oversee production, ensuring quality control. This hands-on approach saved the product, leading to 600,000 units sold in the first year.

Cultivating a Unique Brand Identity

Nothing has cultivated a distinct brand identity that appeals to both tech enthusiasts and creatives. Their curated Instagram feed, blending elements of luxury fashion and technology, attracts a different kind of user. Pei believes in creating products with an iconic, memorable feature, inspired by his partnership with Teenage Engineering's founder. This philosophy led to the development of the "Glyph Interface" on their phone, a system of lights on the back that provides notifications and information without requiring users to constantly check their screens. This design choice aims to promote more mindful smartphone usage, moving away from the addictive nature of modern devices.

Design Philosophy and Future Outlook

Pei favors a balance between practicality and design innovation. He suggests that hardware founders should initially focus on survival and volume, akin to Tim Cook's approach, before prioritizing design flair like Jony Ive. He estimates an 80% focus on practicality and 20% on risk-taking in the early stages. His favorite design elements include the skeuomorphic volume knob on the first iPad and the classic Royal Oak watch. Looking ahead, Pei encourages aspiring hardware founders to be persistent, learn from setbacks, and consider a phased approach, starting with smaller products to build momentum before tackling larger, more complex ones. The satisfaction of seeing people use products you've helped create, especially when they don't know you're the maker, is a unique reward in the hardware industry.

Key Takeaways

• Start Small, Dream Big: Begin with simpler products like earbuds to build credibility and manufacturing experience before tackling complex devices like smartphones.
• Embrace Setbacks: Hardware development is challenging. View failures as opportunities to improve processes, teams, and partnerships.
• Focus on User Experience: Design products with iconic features that offer tangible benefits and promote mindful interaction.
• Build a Community: Cultivate a brand that resonates with a specific audience, blending different interests like tech, design, and fashion.
• Balance Practicality and Design: Prioritize survival and volume in the early stages, gradually incorporating more design innovation as the company grows.