“These were, by their résumés, very superior people. And I thought, gee, maybe there is something here, something more valuable than just being an employee. 
- Arthur Rock, venture capitalist

On a hot summer morning in San Francisco in 1957, eight of the most talented young scientists in America convened for a clandestine meeting at the Clift Hotel. They gathered over breakfast in the famed Redwood Room, a bastion of the city’s old guard. A nervous energy consumed the table, fueled by uncertainty, possibility, and fresh-brewed coffee. The eight worked on developing silicon semiconductors—a groundbreaking new technology—at Shockley Semiconductor outside of Palo Alto. The company’s founder, Nobel Prize–winning scientist William Shockley, was a brilliant but difficult manager: erratic, mistrustful, and impatient. He had even gone so far as to hire detectives to give his employees lie-detector tests, and these employees, experts in a field in which there were few, were frustrated and angry.

After considering numerous options, the men decided they must defect. They planned to establish their own company under the leadership of MIT graduate Robert Noyce, a charming, personable twenty-nine-year-old electrical engineer from smalltown Iowa. Getting Noyce on board hadn’t been easy. He was the leader they needed, but he had a young family, and he needed to be persuaded to leave his guaranteed paycheck for something with no model—creating a new company in a new field based on nothing more than combined knowledge, faith, ideas, and passion.

As Tom Wolfe would later write in Esquire:

“In this business, it dawned on them, capital assets in the traditional sense of plant, equipment, and raw materials counted for next to nothing. The only plant you needed was a shed big enough for the worktables. The only equipment you needed was some kilns, goggles, microscopes, tweezers, and diamond cutters. The materials, silicon and germanium, came from dirt and coal. Brainpower was the entire franchise.”

Brainpower was the entire franchise.....

THE AGE OF IDEAS 

A point in time when creativity becomes the primary driver of value creation and the last remaining sustainable competitive advantage.

It is as if Freud supplied us the sick half of psychology, and we must now fill it out with the healthy half. 

—Abraham Maslow 

It’s fitting that Abraham Maslow, the man behind the concept of the hierarchy of needs, was born in Brooklyn, the city that has come to define the twenty-first-century brand for living a creative existence. Born in 1908 to immigrant Russian parents, Maslow was raised in a very different Brooklyn. His early years were marked by poverty, anti-Semitism, a toxic relationship with his parents, and a lack of self-confidence, but through a combination of extraordinary intelligence—he was reputed to have an IQ of 195—hard work, and the stability of a happy marriage, Maslow persevered and developed theories that expanded our understanding of the human experience. 

Prior to Maslow’s breakthroughs, psychology had focused on what was wrong with people—their neuroses, their mental illnesses. But after witnessing the atrocities of World War II, Maslow theorized that this conventional approach was limited. He created humanis- tic psychology—the study of unlocking human potential. 

Maslow’s work changed the course of psychology by concen- trating on how people could flourish by amplifying what was right about them rather than trying to modify and correct their psychic weaknesses. This cornerstone belief was reflected in his approach to therapy. He looked at people seeking help as clients instead of patients, and strove to establish warm human dynamics with them, not clinical, impersonal physician/patient relationships. With this emotional connection as a basis for action, Maslow then set about working with these clients to improve their lives. 

He believed every human has a powerful desire to realize his or her full potential. Maslow’s term for reaching that goal was self-ac- tualization, which he understood as “expressing one’s creativity, quest for spiritual enlightenment, pursuit of knowledge, and the desire to give to society” within daily life. If an individual is able to self-actualize, they become capable of having “peak experiences,” which he defined as “rare, exciting, oceanic, deeply moving, exhilarating, elevating experiences that generate an advanced form of perceiving reality, and are even mystic and magical in their effect upon the experimenter.” 

Sounds pretty spectacular, right? 

But Maslow also stated that the basic needs of humans must be met before a person can achieve self-actualization and enjoy peak experiences. That means unless you have adequate food, shelter, warmth, security, and a sense of belonging, you’re unable to reach this higher consciousness. Not until the twentieth century had any significant portion of humanity had their basic needs met for a sustained period. 

Making the spirit soar and making somebody sort of lift off the ground and fly is about creating magic. People ask me about magic and what it is; it’s very difficult for me to say. If I knew I would write a book and sell the book. And that magic, that very elusive kind of thing, is what I try to create at these hotels. 

—Ian Schrager 

As we pulled up to the porte cochère, I remember being thrilled. The entrance to the Delano had a magnitude and energy I’d rarely, if ever, experienced before. The valets were all perfectly dressed in crisp white outfits, the people getting out of their cars were beau- tifully put together, and the architecture was the perfect combina- tion of classic Art Deco and clean modern lines. 

While the arrival alone was magnificent, it wasn’t until I entered the lobby that I was swept away: fifty-foot ceilings, a straight-shot visual hundreds of feet from the entrance to the rear orchard, and charming vignettes of whimsical seating and social areas throughout. The beauty was unmistakable, and the energy was so real you could almost drink it. Every step I took built on the drama of the experience. By the time I exited the lobby and stepped into the orchard, I felt changed, as if my appreciation for what the imagination could manifest had been heightened. I didn’t say a word for ten minutes after I walked outside. I just smiled, completely satisfied by what I had just consumed. 

While the experience was powerful, as in many meaningful moments, I wasn’t fully aware of how this night would affect me. I definitely wasn’t aware I would end up spending over a decade of my life involved in different ways with this company, crafting new ideas, creating even more magical experiences. What I did know, without a doubt, was that I had tasted fully realized creative poten- tial. And once I knew it existed, how could I live without realizing my own? So I began my research at the source: Ian Schrager, the iconoclastic creator of Delano. 

Schrager, like Maslow, was born in Brooklyn to a working-class family. Unlike Maslow, he had a close relationship with his parents, especially with his father, Louis, who instilled in him a strong value system. After spending his youth in East Flatbush, he headed off to Syracuse University in 1964. That’s where he met Steve Rubell, another Brooklyn product, who would become his lifelong friend and business partner. An outgoing, flamboyant character, Steve was a couple of years older than Ian, but the two meshed perfectly. As Ian tells it, “We were dating the same girl, and from the way we went about competing for her, we came to respect and like each other. And the friendship just got closer and closer and closer. I would say that from the end of 1964 until Steve died in 1989 I spoke to him every single day.” 

After they graduated, Ian went on to practice real estate law, and Steve started a chain of steakhouses and became Ian’s first client. It was about this time that Ian and Steve started going to clubs together, and they were astonished and inspired by what they saw. For the first time they were exposed to the mixing of different groups of people, the breaking down of social barriers—and the willingness of people to stand in line for the chance to spend their money. This was when Ian began to sense his desire to create. After a couple of months of going out and throwing a few parties of their own, Ian and Steve decided to open their own disco—in Queens, a borough of New York City known more for slicked-back hair and slice shops than for chic parties and celebrities.