Investment fail: Why Apple’s little-known third co-founder sold his 10% stake for $800

Meet the little-known third Apple founder who sold his 10% stake for $800

Owning 10 percent of the most profitable company in the world sounds like a money-making dream. Especially as Apple launches its new iPhone, which will reportedly cost nearly $1,000.

But one man knows what it's like to watch that opportunity slip away: Ronald Wayne, the little known third co-founder of Apple.

According to a recent episode of CNBC's "The Filthy Rich Guide," Wayne joined Apple co-founders Steve Wozniak and Steve Jobs, who were 21 and 25 at the time, to provide the company with "adult supervision" and to oversee mechanical engineering and documentation, all in exchange for a 10 percent stake in the business.

Photo Illustration | CNBC

On April 1, 1976, Wayne sat down at his typewriter and drew up an agreement outlining each man's responsibilities, making his role with Apple official. He also drew the company's first logo (which was used for less than a year before being replaced by the symbol associated with the company today).

But Wayne rapidly grew concerned that any debts incurred by the business would personally fall on him. Jobs had taken out a $15,000 loan so he could buy supplies to fulfill Apple's first contract — a Bay Area computer store, The Byte Shop, had ordered around 100 computers, Wayne tells Business Insider. But The Byte Shop was known for failing to pay its bills and Wayne worried that Apple wouldn't be able to recoup the money.

While both Jobs and Wozniak were young and broke, Wayne had assets, including a house, and feared that the financial burden would fall entirely on him if the deal went south.

The Apple Inc. founding partnership agreement signed by Steve Wozniak, Steve Jobs and Ronald Wayne from 1976.
Scott Eells | Bloomberg | Getty Images

So after spending a mere 12 days with Wozniak and Jobs, Wayne had his name taken off the contract and sold his shares back to his co-founders for only $800.

Wayne's decision to leave the start-up cost him big. Today, a 10 percent stake in Apple would be worth more than $80 billion. That kind of fortune would make Wayne one of the richest men in the world.

Amazingly, Wayne says he doesn't regret his decision, mostly because he knows he'd never have have thrived at Apple. "I would wind up in the documentation department shuffling papers for the next 20 years," he tells Business Insider.

Wayne felt out of place, like he was "standing in the shadow of intellectual giants," he tells Cult of Mac of his brief tenor with the company. "I was 40 and these kids were in their 20s. They were whirlwinds — it was like having a tiger by the tail. If I had stayed with Apple I probably would have wound up the richest man in the cemetery."

Christie's is auctioning off an original Apple-1 computer owned by Ted Perry as part of its First Bytes: Iconic Technology from the Twentieth Century, an online auction of vintage tech products.
Source: Christie's

The one thing he does regret, however, is another lucrative opportunity stemming from his time with Apple. Wayne had kept his original contract from 1976 for years. Then, in the early 90s, he sold it for $500.

"I had this Apple contract sitting in my filing cabinet, covered in dust and cobwebs, and I thought, 'What do I need to hold onto that for?'" he tells Cult of Mac.

According to "The Filthy Rich Guide," in 2011, the same contract sold at auction for $1.59 million.

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