🍎 Apple investors' mental torture

Hey hey, happy Monday Tuesday.

Hope you all had a wonderful long weekend reflecting on what truly makes America great: its diversity of opinion. We are a better nation together than divided, honoring and respecting everyone for who they are.

Quick author’s note before we began: I accidentally left a placeholder in last week’s edition of OptimistiCallie. In the fifth paragraph of the third section, this stat should say:

Since the beginning of December, about 70% of the 10-year yield’s rise has been attributed to the “other” category…

Ugh, my bad! Thanks to all who pointed this out.

Today, I wrote a thing for every one of you who scowl with jealousy over Apple IPO investors and their millions. It’s not as desirable as you think.

Smash the button below to share OptimistiCallie with a friend 😊

2025 AI Outlook: Investing in AI’s Present and Future

Today, I want to tell you the story of Mike Markkula.

One of the greatest executors in history who made the investing mistake of a lifetime.

Mike was an engineer by trade who started his career doing classified work on a Lockheed fighter jet (nbd). He eventually pivoted into product marketing at Fairchild Semiconductor and Intel, overseeing the early days of computer chip and circuit manufacturing. Along the way, Mike collected stock options and did well enough to retire by age 32.

But that wasn’t the end of Mike’s story. He became an angel investor, meeting entrepreneurs all over Silicon Valley and daydreaming about the future of the personal computer. By chance, a mutual friend introduced him to a creatively inclined brainiac named Steve Jobs.

Steve Jobs needs no introduction. But almost five decades ago, Steve was a nobody, and Apple was a one-year-old startup with a hand-built personal computer prototype. Jobs and Steve Wozniak (Apple’s other co-founder) were raising money to mass-produce the next version of their home-brewed prototype, and the Steves crossed paths with Mike.

In 1977, Mike invested $250,000 in young Apple for essentially one-third of the company.

There are two reasons why you’ve heard of the Steves, but never of Mike.

First, Mike wasn’t in the limelight. We know Apple for its colorful ads, sleek user experiences, and product innovation. Mike, however, worked behind the scenes—writing programs, setting processes, and securing financing to keep the company afloat. He wasn’t giving keynote addresses or CNBC interviews.

A lesser-known reason is that Mike cut ties with Apple in 1997. He bailed before the iPod, iPad, iPhone, and AirPods— all the iconic products that made Apple the tech giant it is today. 

According to public filings, he gradually sold his Apple shares up to his departure, whittling his stake down to 2% at the end of 1996.

At today’s value, his ~30% stake shares could’ve been worth over $1 trillion, instead of a mere $72 billion.

Ah, what could’ve been...

OK yes, you’re probably eye-rolling at that last line. Trillions instead of billions, would somebody think of the ultra-wealthy here?

But Mike’s story teaches us an important lesson about one of the tightest-held assumptions about investing.

It is very, very hard to buy and hold one single stock for decades.

Even a company insider with firsthand knowledge of Steve Jobs’ genius couldn’t do it.

Still, we try our hardest to become the next tech gazillionaire. I can’t count the number of friends and family members who gawk over tech stocks like Nvidia and Palantir, then ask me what I think the next big winner will be. Or the questions I get from clients about why we hold European bank stocks when so-and-so stock is blowing others out of the water.

Honestly, I get it. The media tells us about people who seemingly bought Apple on its first day of trading in 1980—enticed by the rainbow logo and the Macintosh PC—and are now worth millions. They caught lightning in a bottle and held it for decades.

What isn’t sexy enough for a headline, though, is that very few investors can actually handle the smoke of a young, promising company.

Those tech unicorns that made Silicon Valley venture capitalists famous? They were once touch-and-go garage projects that relied on half-baked ideas and the fumes of a single bank account. Even after ideas turn into viable businesses, you have to navigate through countless changes—new products, CEO departures, rising competition, shifting consumer preferences, and global events.

In Apple’s case, the first two decades of being a public company were mayhem.

Between 1980 and 1997 the stock went through six drops of 50% or more. For context, the S&P 500’s biggest drop over that same period was 34%, and that just happened once.

Apple was a computer company for most of that period, and it was flailing. Steve Jobs left Apple after a corporate spat in 1985 (with Mike and John Sculley, the CEO at the time) to start a rival computer company. For much of the 90s, Apple held the second spot in PC market share to IBM, a company that was once known for computers (not Watson the Jeopardy robot).

Apple cycled through three CEOs in four years, and was reportedly on the brink of bankruptcy in 1997 before a $150 million investment from Bill Gates. Right around the time Mike Markkula finished selling.

As a shareholder, you had to endure all of this while ignoring the other tech temptations of the 90s and watching your investment repeatedly get cut in half. Then, standing strong in an 80% drop in nine months as the world turned on tech stocks at the turn of the century. That’s conviction.

Not only that, but you had to hold in the good times. A feat harder than it sounds. You had to stay put when that $1,000 IPO investment finally turned into $10,000 in 2005. And you had to resist cashing out to buy that Porsche for $100,000 in 2011. Today, you’re being tempted by the thought of early retirement as your shares hover around $1.8 million in value…and you’re still holding!

If this is you, I have questions.

I doubt when you invested almost 45 years ago, you could’ve predicted the trillion-dollar juggernaut of a company Apple has become four decades down the road. Now, it’s in the midst of another transformation as tech enters the AI arms race.

Your investment has outgrown your wildest expectations. You’ve done the thing that everybody dreams about.

But is this healthy for you?

Are your life and legacy staked on what you do with those shares? You’ve held them longer than you’ve known your kids. 

Are you in too deep? Will you ever sell?

This is what the media won’t tell you.

Buying and holding one stock for decades can be a unique form of mental torture. And for many, it ends without actually enjoying those millions you’ve made on paper.

Back to Mike.

For all we know, Mike still holds 2% of Apple’s shares. I doubt it, though – he doesn’t come up on the billionaire rankings I’ve scoured for this piece.

We may never find out if he’s still invested or what he’s worth. But what we do know is this:

He sold his shares methodically over a number of years. He’s disappeared completely from the headlines. He’s probably not stressing over Apple’s current 12% drop.

Sounds like he’s doing just fine, regardless of Internet lore.

I will never tell you not to pick stocks and ride them for dear life. It’s your money. Do whatever you want with it.

But what I can tell you is that nothing – and I mean, nothing – matters more than your sanity.

Thanks for reading!

Callie

Like what you just read? Share it with a friend, pretty please 😊