Apple and The Cult of Personality

There are a couple of facts about Apple today that may or may not be related.

• Charismatic and dynamic Apple founder and CEO Steve Jobs died a little over a year ago.
• Apple's stock has taken a dramatic downward turn over the past few months.

If Apple was really a cult of personality centered around Steve Jobs, then these two things are directly related. But I think this is an overly simplistic view of what is happening.

Apple's dramatic rise to become the most valuable company in the world was based on it creating entirely new markets with high margin products and then dominating those markets for many years afterwards even as competitors entered with less expensive options.  This was true with the iPod, iPhone, and iPad.

Without an entirely new market or category being created by Apple in the last couple of years, the  rate of growth has slowed.  While still dominant in it's existing markets, there are no new products on the horizon that would warrant the continued growth rate in the stock.

There is also the law of really big numbers at play with Apple.  It is has reached the point in size where it becomes very difficult to continue to grow at the same rate it did when it was smaller.  At some point growth slows.

It is possible that Steve Jobs would have been able to keep the growth up a little bit longer, but not too much longer.  This was no cult of personality, but it was and still is a great company.  It will continue on and while there are surely things that Steve would have done differently, it is difficult to believe that Apple would not have performed about the same.