This video is sponsored by Shopify. There’s no mistaking a Dyson vacuum when you see it. Whether you’re using an upright ball vacuum, a handheld Cyclone, or a motorhead vacuum, there’s something distinctive about their design. And even refurbished, many find them the best on the market. But the sleek and transparent vacuum we have today is a far cry from the cardboard and duct tape prototype built by a man who had been such a terrible student that his headmaster wondered what he’d do with his life. It took more than 5,000 prototypes and near-constant financial debts and the threat of bankruptcy for Dyson to go from a company on the brink, to “outselling its competitors 3 to 1,” and bringing in billions of dollars every year. James Dyson was born in Norfolk, England on May 2nd, 1947. His parents, Alec and Mary Dyson, were both teachers. When James was only nine years old, his father passed away of cancer. It was a difficult time for James, while his mother saw it coming, he didn’t. And soon a kind offer would further isolate the young James. While James' father didn’t have life insurance, the boarding school that Alec Dyson had taught at invited James to attend for free. But going away to boarding school just after his father had died tore James away from his siblings and mother. In James’s own words, “That was probably a pretty harsh thing to do to a nine-year-old.” James soon proved to be a terrible student. At one point, his headmaster even told his mother, “Goodness knows what James will do, but he must be talented somewhere and somehow.” Implying quite strongly that no talents had been seen yet. One issue was that he was far more interested in art than the usual practices at a boarding school. Once, when put in charge of creating informational pamphlets for a school play, James created curled up scrolls instead of flat booklets. When the headmaster saw, he was enraged, saying “Programmes, Dyson, should be flat!” James said it was a good lesson. That day he learned that, “to change things and be an inventor, you are going to come up against trouble all the time." In terms of future career prospects, a career advisor told James his love of the outdoors made him well suited to be an estate agent, or maybe he should consider the medical field. But there was one thing his career counselor told him explicitly not to do. He was told not to go into art... So he did. In 1966, James enrolled at the Byam Shaw School of Art in Kensington for painting. At the time, James had wanted to be a painter, but hadn’t thought much about life beyond that. When the end of the year came, principal Maurice de Sausmarez sat James down and asked what he wanted to do. When James said that he hadn’t thought about it much, Maurice suggested he become a designer instead. Byam Shaw School of Art was also where James’ future wife, Deirdre, studied. Furniture design took James in particular, so he enrolled at the Royal College of Art to study the field. At the time the Royal College of Art was exclusively a post-graduate school. However, they were running an experiment and would let in three students who didn’t meet that qualification. As luck would have it, James was among them. James started his studies there with Furniture Design, but found that the program had been attached to Interior Design and Industrial Design to create an interdisciplinary “three-department class”. Here, he discovered an interest in Interior Design, specifically the nitty-gritty of designing rooms. He was encouraged to explore filmmaking, sculpture, and industrial design before finally settling on engineering. Once a week, renowned structural engineer Tony Hunt would teach a class on the subject of his expertise. James found him inspiring, because not only was Tony a working structural engineer, he was a designer too. Tony could talk both about how structures worked, and their appearance, and was able to draw designs that even those without a background in mathematics could understand. Like James. Tony encouraged his students by walking around the classroom, talking to them about their individual projects, and becoming invested in the methods his students used to keep their structures standing. James found him inspirational. While studying at the RCA, James also designed a new children’s theatre for director Joan Littlewood. He had overheard Joan mention her desire to build a new theatre in East Stratford that could be covered by a tent in the winter. James came up with a mushroom-shaped design influenced by the works of American architect Buckminster Fuller, and aided by Tony when drawing up plans. Unfortunately, while they managed to get permission for the plans, they were never able to raise the funds needed to build it. One of those James approached for funding was British inventor and the founder of Rotork, a design and manufacturing company, Jeremy Fry. While Jeremy denied him the funds, he did offer James some work. Fry handed James freelance design jobs, one of which involved working on a high-speed landing craft that Jeremy had invented and intended to sell for military purposes around the world. James’ role in this project was to design and engineer a prototype. James began theorizing on the design, to which Jeremy replied, “Shut up. Just go and make it. See if it works.” Leading James to realize the importance of experimenting and prototyping. After a few designs, James created a design that took. Then, once James had finished college, Jeremy hired him on to Rotork, the company building the final product. Known as the sea truck, final sales of the vehicle amounted to over 500 million. In 1973, James was promoted to director of Rotork. But he had realized something while working on the sea-truck. He didn’t want to design what someone else wanted, or have someone else build what he designed, he wanted to control everything in the process and follow his own path, so in 1974 he left the company to build his own creation. A wheelbarrow. Enjoying this video so far? Make sure you subscribe to learn more stories about industry leaders. James wanted to make things for ordinary people, not militaries. His first innovation came after his wheelbarrow got stuck in the soft ground and cement started to spill from it. He realized that he could improve the age-old design with a wider surface to hold the weight. Those in the industry balked at the idea, but James managed to push the idea far enough to create his first company named Kirk-Dyson. In gathering the funds for his new company, James had needed to build and patent his ballbarrow product. But when he founded his company, he gave Kirk-Dyson the patent, and when investors bought in, they wound up with a controlling share in it. James didn’t own the patent to his invention. Still, the ballbarrow was a success and took over 50% of the UK market for wheelbarrows. Yet it never made much money due to the market demand and markup being small. But it was in the ballbarrow factory that James would find his next inspiration. Painting ballbarrows involved spraying a powder onto them. In order to properly clean up the leftover residue, a large, industrial vacuum cleaner was required. At first, the vacuum the factory used had something akin to a vacuum bag that was constantly getting clogged by the epoxy dust. When it came time to replace it with a cyclone model that used centrifugal force, the cost proved to be far too expensive. So James snuck into a sawmill at night and took measurements of the one they used. Then he built his own, and installed it at the factory. With the new cyclone vacuum, James noticed that it didn’t clog the same way their previous model had. James became taken by the device and wondered why no one used the design for home vacuum models. James had just purchased a Hoover vacuum, advertised as the most powerful in the world. However, he noticed that the suction seemed to grow weaker every time he used it. He assumed it was because the bag was full, but emptying it didn’t help. Instead, he found that the small pores in the bag and filter that air travelled through were getting blocked by dirt particles. He went home and built a cyclone of his own from tape, cardboard, and a piece of hose then attached it to his own vacuum. It worked, and James went to his company with his revolutionary new design. And was immediately fired from his own company. The investors of Kirk-Dyson believed that if there was the possibility of designing a better vacuum cleaner, a leading company like Hoover would have already made it. They were sick of James, and this suggestion was the last straw. At age 31, James found himself fired from his own company with nothing to show for it but a pile of debt, a mortgage, and a family to support. A pile of debt, a mortgage, and the cost of supporting a family still wasn’t enough to stop James. James sought out other means to create his new vacuum cleaner. He approached Jeremy first to raise some funds. Together, they established a new company, the Air Power Vacuum Cleaner Company. After that, James got to work. He started building prototype after prototype in his backyard shed. He had two issues with the cyclone design he was working on: First, industrial cyclones only separated air from dust down to 20 microns—about half the size of the smallest thing a human eye can see. James needed his cyclone to separate dust down to half a micron in order to capture particles from things such as cigarette smoke. Second, hairs and fluff would go through the cyclone without being separated. James needed to find a way to collect those as well to properly clean them. You may have heard the phrase, “the road to success is paved with failure”, and that’s a phrase that James seems to have taken to heart. It took him five years. James built prototype after prototype of his cyclone vacuum. By prototype number 2,627, he and Deirdre were really counting their pennies. His friends thought he had gone mad, but everytime he thought about quitting, Deidre pushed him to keep going. When money got tight, she gave art lessons to help support them. Then, after 5,127 prototypes, James developed a design that worked. Using a low efficiency cyclone on the outside to spin out larger pieces of dirt, and a high efficiency cyclone inside to separate finer particles of dirt, the design met his needs. James dubbed it the Dual Cyclone. Now all James had to do was manufacture it. The only problem was that his company was in debt from the development and patenting process of the system and couldn’t afford to enter into full scale manufacturing and sales of the final design. So James thought he would license the design out. After all, who wouldn’t want it? James and Jeremy changed the name of their company to Prototypes Ltd. to reflect their new focus, but they still needed to find a licensee. His discussions with Hoover ended immediately as Hoover insisted that the rights for anything they discussed be handed over. Other vacuum companies turned out to be just as uninterested. What James realised was that the vacuum business was a razor and blade market. Like Gilette makes much of their money from replacement blades for their razor handle, vacuum companies made their money from selling bags on the market for $500 million a year. The idea of a bagless vacuum went against how they made their money. Fortunately for James, he did find someone to license the design to. First, Jeremy’s company Rotork licensed the design and sold it as the Cyclon. Only 500 units sold, but the customer feedback James received as a result helped him improve the vacuum. An opportunity to further license the Dual Cyclone vacuum came thanks to the Cyclon appearing in an in-flight magazine from Trans World Airlines, where it was discovered by Amway, an American company that negotiated a licensing deal. But when James flew out to sign the contract and hand over technical details, Amway pulled out, asked to renegotiate, and eventually sued the company. Amway claimed that Prototypes Ltd. had deceived them, and that the product was not yet ready. Prototypes countersued in retaliation, but were forced to settle out of court due to dwindling finances. This, however, only led to further legal battles. In the midst of settling their legal dispute, James discovered that Amway had made a bagless vacuum of their own. One that was suspiciously similar to the technical designs he had shown them. Prototypes sued Amway again, this time for patent infringement, and only managed to settle years down the line. With bankruptcy looming for James, and an ongoing legal battle, he needed something to go right. Thankfully, something did. With the help of a small licensing company from Japan called Apex Limited, James managed to license his Dual Cyclone design to a Japanese company which sold it as the “G-Force”. At the time, it was made of pink plastic, and sold for $2,000. It became a status symbol, and won the 1991 International Design Fair in Japan. The royalties he made from sales in Japan saved Prototypes from bankruptcy and let James go his own way again. He’d taken a lesson away from his previous negotiations with vacuum companies: if he wanted to manufacture his new and improved vacuum cleaner, he’d have to do it himself. Especially if he wanted to do it for a reasonable price. He had also since bought Jeremy out of Prototypes, leaving him on his own when it came to raising finances for the project. This proved to be easier said than done, however. Investors weren’t interested in funding James now that he was the one in charge. Despite the award his design had won in Japan, they didn’t believe that an engineer and a designer knew anything about actually selling the product. But soon, James would get a fresh influx of cash thanks to an unexpected reason. Undeterred from more rejection, James went ahead and established a new company of his own: Dyson Limited. He managed to finance his new company by taking out a loan of almost 1.25 million pounds from Lloyds Bank against his house. The bank manager had been hesitant, but wound up approving the mortgage for two reasons: First, he saw that James had endured legal battles already. James’s determination in the face of his multiple lawsuits with Amway won the bank manager over. And second, the bank manager had returned home and asked his wife what she thought of a bagless vacuum cleaner. Her response was an enthusiastic, “Exactly what I want”. The money in hand, James turned around to design, and manufacture, the first Dyson vacuum: The DC01. Now all he had to do was sell it. Selling the DC01 proved easier said than done. Once more, everywhere James went he faced rejection. Eventually, James set up a meeting with the chief buyer for Great Universal Stores, the largest mail order catalogue in the UK at the time. The man had agreed to see him because apparently he was curious about the “funny man who had done this yellow vacuum cleaner with a cyclone instead of the bags.” After hours of negotiation the buyer asked him, “Why should I put your vacuum cleaner in my catalog and take out a Hoover or an Electrolux?” Especially since the DC01 cost three times as much as its competitors. James replied, “because your catalog is boring.” The buyer reportedly stared at James for some time before finally saying, “Okay. I’ll give it a go.” Dyson had found its first distributor. The other vacuum companies weren’t happy to see the DC01 on the market. Established brands started resorting to tricks to try and sabotage James’s product, with an executive from one company telling customers that if they wanted a vacuum cleaner from someone who used to make wheelbarrows, then they should buy a Dyson. If they wanted to buy a vacuum cleaner from people who made vacuums for 90 years, they “should buy ours.” But even that wasn’t enough to stop Dyson now that it was out and in the public eye. Still, their competitors claimed that they would be a flash in the pan, dismissing them as something that would be gone in six months. Within six months, the DC01 had captured 50% of the British market. Within a year, it was the best selling vacuum in the UK. After two years, Dyson had brought in revenue of $100 million. And after four years, Dyson had sold more vacuums than their two largest competitors, Hoover and Electrolux, combined. It seemed that everyone thought it was a great idea. Including Hoover. The vacuum giant launched a product of their own known as the Triple Vortex vacuum that was similar to James’s design. Suspiciously so. Dyson sued the vacuum manufacturer for patent infringement and won, leaving Hoover legally blocked from selling more Triple Vortex model vacuums until such a time that James’s patent expired. Hoover’s Vice President for Europe, Mike Rutter, would later say, “I do regret that Hoover as a company did not take the product technology off Dyson; it would have lain on the shelf and not been used.” By 2001, James decided he didn’t enjoy being a CEO. He wasn’t interested in business, and the job was too much for him. It was time to hand the reins of CEO over to someone else, namely, Martin McCourt. While James remained the sole owner of the company, he would go back to the work he loved: engineering and designing. Under Martin, Dyson expanded to the United States and released new products. Not all of them succeeded, like the Contrarotator washing machine which had to be pulled from production because it was too complex and sold for too little, with James saying,”As a washing machine, it was a great success. As a business, it wasn't.” Still, James found it a valuable experience, and the company continued to expand at a fast pace. Which made it a problem when they were denied an expansion at their Malmesbury, Wiltshire manufacturing plant. So in 2002, James made the difficult decision to relocate their manufacturing. He moved the operation to Malaysia, at the cost of 500 jobs in the UK. His decision was motivated by the lower cost of production in Malaysia, their existing factory there, closer proximity to their strong markets in Australia and New Zealand, and part supplies from other Southeast Asian countries including from their existing factory. Dyson entered into the US market with the upright vacuum, the Dyson DC07. At the time, Forbes printed a quote from a vacuum dealer reading, “Dyson? Who’s he?” In a mocking piece, adding, “If I were Hoover, I wouldn’t be quaking in my boots.” In a market where everyone was racing to hit the market with a vacuum under $100, the DC07 was an expensive machine. Plastic was viewed as cheap in the US at the time, and the DC07 was coated in it, and moreover, most vacuums tried to hide their internal workings, while the DC07 showed you everything— including the dirt that you collected. But just like everyone else who doubted Dyson’s vacuum, these critics were soon proven wrong. A junior buyer for Best Buy took the DC07 home and used it for two weeks. During that time, she found that it worked just as well as advertised. Best Buy’s merchandise manager, David Kielly, decided to try it for himself and found the sight of the DC07’s bin filling with all the dirt his other vacuum had missed thrilling. Best Buy reached out to Dyson and asked to sell the DC07 in-store. Dyson said yes, and made their US launch through the retailer, and in 2002 alone sold ten times more DC07s than they had predicted. Dyson was a hit. Soon Target picked up the vacuum. Then Home Depot, Sears, as well as Bed Bath & Beyond. By 2004, Dyson became the market leader in dollars spent, and by 2010 had captured 23% of the American market, selling over 890,000 units and making $223 million in profit. Since then, Dyson has built a reputation for quality and high-end appliances that people are only too happy to pay more to get. They have expanded their product line with new vacuum models as well as fans, air purifiers, lights, hair dryers, and hair curlers. Their latest innovations have included a bladeless fan called the Air Multiplier, the Supersonic hair dryer, and the Airblade hand dryer seen in bathrooms around the world. They sell products in more than 65 countries, and bring in an estimated $3 billion a year in sales. James himself still owns 100% of his company, and is worth $23 billion today. He has also been recognized by the British government, and was knighted by Queen Elizabeth the Second in 2006, and has also been given a Commonwealth Order of Merit, named a Royal Designer for Industry by the British Royal Society of Arts, among many other accolades. What we can all learn from James’ story is that contrary to popular belief, inventors do not come up with fully-formed billion-dollar ideas from “eureka moments.” Instead, these ideas may come from a spark of curiosity on how to solve a problem followed by trial and error. Being focused, patient and persistent are more important than solely having money to bring your idea to market and make a profit. And while there will be challenges along the way, it's 100% doable — especially given the resources we now have. Today, anyone can launch their idea online to bring it to market. In fact, Shopify, the sponsor of this video, offers an easy to use and affordable commerce platform that allows anyone to build, design and manage an online store — regardless of technical or design ability and experience. Shopify also helps entrepreneurs with technical support 24/7, offering built-in marketing tools such as email campaigns and Google and Facebook ads, and analytics tools to gain insights on sales, website traffic, and customer demographics. If James started Dyson today, he'd very likely avoid being rejected by retailers by selling his vacuum online with Shopify. It's where over 1,700,000 businesses in 175 countries around the world have made over $200 billion in sales. If you’re an aspiring entrepreneur, you can learn more about how you can find great business ideas by going to shopify.com/hook or click the link in the description below. And for more inspiring stories and business takeaways, don’t forget to subscribe to our channel!
