How Challenging Times Have Triggered Innovation
By: John Prindle
Tags: Innovation, Entrepreneurship, Business Plan

How Challenging Times Have Triggered Innovation

Some of the greatest inventions throughout history were born from challenging circumstances, and some of the biggest innovators have emerged from periods of darkness.

We’ve all heard the phrase, “necessity is the mother of invention.” And it’s true. There’s no doubt that we’re facing the worst pandemic in modern times, but this doesn’t mean that things will just grind to a halt. This week, we take a walk down memory lane to see how those before us overcame adversity and changed the world for the better.

The Great Plague of 1665

Let’s go way back to 1665, when the Great Plague of London caused the University of Cambridge to close its doors and send students home to continue their studies. Among these students was Isaac Newton, a nobody in his early 20s who had yet to earn the title of “Sir.” This early example of work-from-home was a godsend to Newton, who thrived without his professors’ oversight, and he spent more than a year working alone at his family’s estate.

We’ve all heard the story of the apple tree and Sir Isaac’s theory of gravity. This happened during his annus mirabilis, or “year of wonders,” away from the confines of structured classes. But wait — there’s more! During this period, Newton continued to work on the mathematical problems he’d begun at Cambridge, and the papers he wrote evolved into early calculus. He also experimented with prisms in his bedroom and developed his theories on optics. Newton returned to Cambridge in 1667 and was quickly made a fellow, and then a professor, thanks to his breakthroughs. Oh yeah, I almost forgot: he also changed the scientific world forever.

Sir Isaac Newton, post apple tree

The Long Depression of 1873

Let’s move ahead through time to the Long Depression of the 1870s and ’90s, when groundbreaking innovations such as the incandescent light bulb, the steam turbine, and the radio were born.

Guglielmo Marconi was an inventor who is credited with developing the first effective system of radio communication (although some claim that Nikola Tesla actually invented the idea of radio in 1892). Marconi’s work dates back to 1894, when he began experimenting with radio waves as a student at the Livorno Technical Institute. Though he wasn’t a scientist, Marconi recognized the value of wireless technology and he was a natural entrepreneur who put the right people together to invest in the technology, receiving his first patent in 1897. In 1901, Marconi sent and received the first the first wireless message across the Atlantic Ocean — and after years of additional work, he was able to establish transatlantic service.

In 1922, William Paley bought several small radio stations and eventually grew them into the Columbia Broadcasting System (CBS), and radio hit the mainstream. When the Great Depression came in the early 1930s, Americans relied on radio as an inexpensive way to keep up with news and to be entertained.

Guglielmo Marconi

The Great Depression

Invented in 1933 by Alfred Mosher Butts, an unemployed architect, Scrabble is now one of the most popular games in the world. Butts was not the type of guy to feel sorry for himself during his period of unemployment, so he decided to create and sell a new board game. He was analytical in his approach and came up with the novel idea of using letters as pieces. He studied letter usage to glean information about assigning point values, and he handcrafted the first boards and tile racks and sold a few hundred sets of what he called “Criss Cross Words.” His attempts to find a company to manufacture the game failed, but in the 1940s a federal employee named James Brunot saw the commercial possibilities for the game and offered to buy the rights. Butts agreed to the sale but only on the condition that he would retain patent rights on each game sold. The name of the game was changed to Scrabble, and the rest is history.

The Recession of 1982

Now we arrive in the “Me-First Decade,” the 1980s, when new technologies were changing the world. Although personal computers had been around since the mid- to late-1970s (as kits such as the MITS Altair 8800 and the Apple I), the most significant developments came in 1981 with the IBM PC, and in 1982, which Time Magazine dubbed “The Year of the Computer.” But just when things were looking bright, along came the recession of 1982: the worst economic downturn in the U.S. since the Great Depression.

While we might think of Apple, IBM, and Microsoft when reminiscing about the history of personal computing, there were many other companies and products in the industry’s early years. One of these was the Bloomberg Terminal, which hit the market in December of 1982 at the height of the recession. Unlike the PC or Mac, the Bloomberg Terminal has always been a niche product targeted toward investors and other financial professionals. It is also one of the industry’s few truly enduring successes that has kept its core DNA for nearly 40 years. The Bloomberg Terminal of today (known as Bloomberg Professional) provides more than 325,000 subscribers with comprehensive financial information and the ability to execute trades. It processes 60 billion pieces of information from the market per day, yet is still recognizable as a descendant of the original machine from 1982.

An original Bloomberg Terminal from 1982

Its invention came about when Michael Bloomberg was forced out of his partnership at Salomon Brothers. He used his hefty $10M severance package to start Innovative Market Systems and created 20 units of the Market Master computing system (the Terminal’s first iteration) that were used by Merrill Lynch at the end of 1982. Although it’s a much different story than the classic tech-startup born in a garage, Bloomberg’s timing was impeccable, tapping into the the nascent electronic shift in the stock exchange. Large companies were attempting to take advantage of this revolution in the financial industry as well, but Bloomberg’s company benefited from being small, focused, and unburdened by ties to the past. Speaking in a 1982 interview with the New York Times, Bloomberg commented on launching a new company during an economic downturn. He said, “This is an interesting time. You can’t go out and start a steel mill, but the position of the business cycle and the rate of technological change are such that people can go and start small companies when they have a few people with good ideas.” Sounds a lot like where we’re at in 2020.

History is Waiting for You

These are but four disparate examples of successful ideas and innovations that came about during tough times. There are countless others. I believe that the next few years will usher in a wave of new concepts that will change the world, as creativity will be pushed by the constraints and challenges of 2020. As we move into 2021, a new group of innovators will emerge to take the world in exciting new directions. Will you be one of them? If we can learn anything from the past, now is not the time to lay low and wait for things to get better; now is the time to start that company or launch that new product.