As of this writing, the world contains 433 “unicorns”—venture-backed companies that boast a market value of $1 billion or more. While these companies get a lot of press, they’re a relatively small part of their respective economies. In early 2020, US-based unicorns had a combined market value of $650 billion. This seems like a big number, but at the time amounted to just slightly more than 2 percent of the combined market value of the S&P 500. While entrepreneurial enclaves like Silicon Valley are important, we need to find ways to turn up the entrepreneurial flame in every organization.

Over the course of the next month, Tom and Steve went over the possible financial structure in great detail and arrived at a price: $7.4 billion. (It was an all-stock deal—2.3 Disney shares for each Pixar share, and netted out to $6.4 billion because Pixar had $1 billion in cash.) Even if Steve stopped just short of being greedy, it was still a huge price, and it was going to be a tough sell to our board and to investors.

A 2012 story in the New York Times reported that Apple needed to hire nearly nine thousand industrial engineers in the earlier days of iPhone production. The company’s analysts expected recruitment to last nine months to hire that many engineers in the United States. In China, they were able to do it in two weeks. A large pool of good labour increases the speed of design and production cycles. As Tim Cook once said, “In the US, you could have a meeting of tooling engineers and I’m not sure we could fill the room. In China, you could fill multiple football fields.

In 2007, Apple imported nearly all of the high-valued components— display screen glass from the United States, camera modules from Japan, memory chips from South Korea, sensors from Germany— to Shenzhen. China’s contribution consisted mostly of the labour involved in assembling foreign products, which was around 4 percent of the phone’s final value. One former Apple executive told me that the iPhone supply chain grew more “red” over the next decade as it incorporated domestically produced components— meaning that it incorporated more Chinese components.

In the modern world, many manufactured products can be refashioned for military purposes. The smartphones we carry around have sensors that would have been military grade a decade ago. The consumer drone is also dual use, which is why Ukrainians and Russians have tried to buy China’s DJI drones for the battlefield. That’s why industrial capacity should be understood, increasingly, as military capacity. All the drones, smartphones, and batteries that are overwhelmingly produced in China give it an advantage that the United States does not necessarily have.