The Innovation Stack: Building an Unbeatable Business One Crazy Idea at a Time

by Jim McKelvey

Overview

From the cofounder of Square, an inspiring and entertaining account of what it means to be a true entrepreneur and what it takes to build a resilient, world-changing company

In 2009, a St. Louis glassblowing artist and recovering computer scientist named Jim McKelvey lost a sale because he couldn't accept American Express cards. Frustrated by the high costs and difficulty of accepting credit card payments, McKelvey joined his friend Jack Dorsey (the cofounder of Twitter) to launch Square, a startup that would enable small merchants to accept credit card payments on their mobile phones. With no expertise or experience in the world of payments, they approached the problem of credit cards with a new perspective, questioning the industry's assumptions, experimenting and innovating their way through early challenges, and achieving widespread adoption from merchants small and large.

But just as Square was taking off, Amazon launched a similar product, marketed it aggressively, and undercut Square on price. For most ordinary startups, this would have spelled the end. Instead, less than a year later, Amazon was in retreat and soon discontinued its service. How did Square beat the most dangerous company on the planet? Was it just luck? These questions motivated McKelvey to study what Square had done differently from all the other companies Amazon had killed. He eventually found the key: a strategy he calls the Innovation Stack.

McKelvey's fascinating and humorous stories of Square's early days are blended with historical examples of other world-changing companies built on the Innovation Stack to reveal a pattern of ground-breaking, competition-proof entrepreneurship that is rare but repeatable.

The Innovation Stack is a thrilling business narrative that's much bigger than the story of Square. It is an irreverent first-person look inside the world of entrepreneurship, and a call to action for all of us to find the entrepreneur within ourselves and identify and fix unsolved problems--one crazy idea at a time.

Product Details

ISBN-13:	9780593086735
Publisher:	Penguin Publishing Group
Publication date:	03/10/2020
Pages:	288
Sales rank:	1,063,015
Product dimensions:	5.60(w) x 8.60(h) x 1.20(d)

About the Author

James McKelvey is a serial entrepreneur, inventor, philanthropist and artist.
He is the cofounder of Square, was chairman of its board until 2010, and still serves on the Board of Directors. In 2011, his iconic card reader design was displayed at the Museum of Modern Art.
In 2016, McKelvey founded Invisibly, an ambitious project to rewire the economics of online content.
In 2017, he was appointed as an Independent Director of the St. Louis Federal Reserve.

Read an Excerpt

Introduction

Suddenly, we won.

For over a year, a giant monster had chased us through the graveyard of corporate corpses. Amazon, the scariest monster on the planet, had copied our product, undercut our price, and was going to eat our brains. Then, without warning, on Halloween in 2015, the monster stopped the at­tack and handed us a treat.

This treat was better than any bag of candy. Not only did Amazon discontinue its competing product, it also mailed the product’s existing customers a little white Square card reader in a smiling cardboard box. Happy Halloween! Was this a trick?

Square, the little company that I cofounded with Jack Dorsey back in 2009, had just done something amazing. The odds of surviving an attack by Amazon would depress a Powerball player, but there we were, still alive after going “nose‑to‑toe” against the world’s most dangerous company. Was this just luck, or had something else happened? I knew what we had done, but I didn’t have any idea why it worked. I spent the next three years answering that question, and eventually wrote this book.

This is not the story of Square. Instead, it is the story of how founding Square led me to discover a phenomenon that applies across industries and even time. Square is a good example because I can tell the story firsthand; but if this were just about Square, I would not have written this book.

What happened at Square was no accident; it fit a pat­tern. It’s a pattern that repeats in a shockingly regular man­ner; and when it does, the companies that harness it become the biggest of their kind in the world. Patterns are funny things, for you can see them your entire life without ever noticing them. But once you finally notice, they appear ev­erywhere. When I learned to notice this pattern, it was like finally seeing the world in three dimensions— was still looking at the same objects, but now everything had depth. My enhanced vision revealed even more patterns. Patterns that have changed the world.

Table of Contents

Introduction ix

Part 1 Solving a Perfect Problem

1 Entrepreneurs and Perfect Problems 3

2 Bob and the Pyramids 11

3 Squaring Up 31

4 The Innovation Stack 54

5 Squaring Off 70

6 Copies of Copies 82

Part 2 The Mythical Expert

7 Lemonade 101

8 Entrepreneurs Everywhere 107

9 The Bank of Italy 115

10 The Boy They Kicked Out 130

11 The Cloud God 143

12 When 160

Part 3 Innovation Physics

13 Stack Attack 185

14 The Invisible Army 198

15 Low, Not Lowest 213

16 Disrupting Disruption 227

17 How it Feels 235

18 Back to Zero 249

Acknowledgments 263

Index 265

Editorial Reviews

McKelvey tells the remarkable story of how with Square, he started a business that would transform an industry, along the way unlocking a whole new model for innovation. An inspiring call to action for entrepreneurs who want to tackle problems that affect our everyday lives, with perseverance and some crazy ideas.” —Steve Case, chairman and CEO of Revolution, cofounder of AOL, and author of The Third Wave: An Entrepreneur's Vision of the Future
 
“The Innovation Stack is a deeply useful book about the characteristics of successful companies and how and why to build one, complete with inspiring case studies that literally span centuries. But it’s also much more than that: a witty, humane exploration of living in the complicated, inequitable world we all share and are working to make it less so.” —Eric Ries, entrepreneur and bestselling author of The Lean Startup
 
“Who can say they went up against Amazon—and won? Jim McKelvey can, and this book tells how.” —Peter Thiel, entrepreneur, investor, and author of Zero to One
 
“Growing up in the Show Me State—aka Missouri—made me skeptical of everything . . . especially Jim McKelvey. I’d say more but I’m out of charact” —Jack Dorsey, cofounder and CEO of Twitter and Square

From the Publisher