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once he realized sort of how fast the internet was growing that it was a land rush and that Capital was going to be extraordinarily prevalent you know in terms of the valuation he was getting and the and the and the funds that he had access to that's when he went for it so 9899
to him 250 million is a drop in the bucket and he thinks that you know with a with a with a much longer Runway he can do some interesting things
there are legitimate grievances. Now, I'm not saying that, you know, that these are monopolistic or anti-competitive practices. But I think a lot of good points were raised in the, you know, Sicilini's house committee that looked into Amazon and other tech companies. You know, and it's a story we've seen before, you know, a company that scraps and fights for every inch of market power over the course of 10, 20 years, and then becomes dominant, but doesn't necessarily change its stripes. And I th
the relationship that Amazon has with its sellers, most favored nation price pricing schemes, you know, retreats in behavior that maybe made sense in 2005, but doesn't does it in 2021.
And Andy presents a humbler, safer target. I think he'll represent the company well. I do, though, think that genuinely Jeff has moved on, even to an extent that I didn't really understand early on, but sort of saw when I went to Van Horn, the way he talked about Blue Origin and its philanthropic initiatives and not Amazon.
Amazon bought Whole Foods. And as I said, they've allowed John Mackey to run it in Austin. They haven't done much to it. And that's probably comes from a hard one awareness over the years with Quincy and Zappos and all the companies they bought in the 90s. That that kind of thing takes many years and creates a cultural mess.
the real moat was in the grocery business, which Amazon is still on a journey to figure out.
no one wants to work with Amazon. I mean, they, and I tell the story in the book they, when they want, they tried to replicate the Google Express or the Instacart experience of working with conventional retailers and putting their inventory online, but it's Amazon. Nobody wants to facilitate their own death. So Amazon has to build fulfillment centers that are now closer to, or even inside cities. So that's taking a while, right? And that's, that's why Amazon spends billions of dollars, uh, build
they're on a journey to kind of figure that out. How can they go compete with the Kroger's and the Walmart's of the world, or even the Rite AIDS or the Walgreens of the world. Um, and it's going to be, it's going to look conventional, but there's going to be tech behind the scenes and they're going to do it in an Amazon-like way.
the ghost store is probably the biggest investment, uh, that Amazon has ever made in anything.
Amazon's growing now, not via new whole food stores, but by creating their own supermarket chain. Uh, the, the fresh markets with the Amazon go cameras in, in, in the ceiling.
the metric of success is how many new prime members we get.
Like you just look at prime video and Amazon studios. I mean, that is a service that, you know, Netflix and Disney plus and other companies are charging significant monthly fees for. And Amazon makes it free for prime members that allows them to compete in a totally different way. While at the same time with AWS, they go and they power apple TV and Disney plus and Netflix. So, you know, Amazon gets to win at a lot of different levels.
Um, you know, for, uh, Bezos has been really good as, as he's, as the company grew about figuring out where he can add value. You know, what can he do at the end of every year to get people onto the same page, particularly when you've got a company that's half a million or a million people.
for a long time, the thing that he did was in every meeting, um, he would say, what are you doing for prime? Um, it, it, it, it's the glue that holds it all together. And, you know, the prime customer is their best customer. They'll, they'll spend two to three times as much as a non prime member. Um, and, and so it's like all roads, uh, all products at the company are on ramps that lead to prime. And it's been, you know, it's been an enormous competitive advantage for the company.
And then more recently, some of the perks that they've started to give to workers, um, and, and, you know, some of the education reimbursement, the $15 an hour wage. They're a leader. So it is important. Right. I mean, other companies want to be like Amazon. They follow Amazon.
Amazon is the second largest employer in, in the country right now.
the preponderance of Amazon employees are not complaining vociferously. You know, they're, they're happy to work there. Um, they're having productive careers. They're having their education paid for, but we can't ignore a vocal subset of employees. Um, you know, some who get ill, who develop ergonomic disorders at work. Um, pregnant employees who it's well-documented have, have been sort of mistreated by a company that historically is so focused on meeting its promises to customers, getting effi
had to make because, because Alibaba and, and then a startup called wish were, were, were doing that. And it was, it was a disruption and they had to move, move quickly.
Let's be honest, probably turned a blind eye to it for a while.
creating a, a globalized marketplace and reducing the friction, creating a self-service system for sellers around the world, reducing all friction to selling. And now spending billions of dollars to fight counterfeits and fraud and ensure that the items are safe, right?
I, I, you know, I would not have written two books and devoted a large portion of the last decade of my life and my 40s. Yeah. To, to crawling, including this company, if I just wanted to kick it in the knees, if I thought it was a nefarious presence in society. I'm a Amazon prime member. I'm elect an Alexa owner. I watched the movies and the TV shows. So, you know, I'm, I'm a, I'm a customer at the same time. I think both things are true. It's okay. An amazing company. Um, but you know, like a
Amazon right now is building you know hardware and Digital Services to compete with you know Google and apple two far better capitalized more powerful frankly companies
I think it's fair to say Twitter is a this might be a little unfair but it's a it's an idea and a company that succeeds despite the founders or at least as you say maybe part because of the of the friction
he's building a studio in LA to build um original to make original programming
to him 250 million is a drop in the bucket and he thinks that you know with a with a with a much longer Runway he can do some interesting things
he thinks of his resources and his long-term orientation um as advantages
Amazon right now is building you know hardware and Digital Services to compete with you know Google and apple two far better capitalized more powerful frankly companies and he is looking for lots of points of Leverage to convince people to give them good reasons to buy a Kindle versus an iPad or a Samsung tablet
he's just he's one of these founder operators you know there are very few of in the world that people just believe in they have a magical Aura and you know Jeff Bezos has proven himself really in a lot of ways as the next Eve jobs and his shareholders will follow him deep into the red because they believe he's building one of the biggest companies in the world
he's growing the business because he's playing you know the game for not tomorrow but 10 years from now and building the the biggest retailer in the world so Amazon is quite profitable but it's hiding its profits in international expansion and new hardware devices and Amazon web services and you know all sorts of unprofitable foray into new businesses that they believe will pay long-term dividends
Amazon's a terrible idea right it you know first party e-commerce is the most unprofitable idea on the internet in the world but it succeeds because of the Ingenuity of its founder
there was plenty of Blood on the floor um and um you know it's it's all the book but um you know I think it's survived you know one I think the easiest answer is Jeff's in Ingenuity you know he um you know he he he he ran the company um you know extraordinarily aggressively and and then in 20201 when everything's changed he he was versatile enough to to put the brakes on um and you know they had to lay a lot of people off and they closed some fulfillment centers U but he got cost under control i
once he realized sort of how fast the internet was growing that it was a land rush and that Capital was going to be extraordinarily prevalent you know in terms of the valuation he was getting and the and the and the funds that he had access to that's when he went for it so 9899
I think Jeff was ambitious I think he kept a lot of that to himself you know in the book I talk about his fir his job on Wall Street working for de Shaw and they had the conception there of an everything store and he just thought it was Impractical that you had to start and own a category and he chose books for a lot of strategic reasons
they're also you know unfamiliar with the trajectory that is the internet right they they're not prepared for the massive demand that hits their servers in 96 and 97
none of the systems were around them right today you would start Amazon on Amazon you would use AWS and they're inventing as they go along
in a lot of ways it was a your characteristic startup you know was in a started in a garage um you know bunch of Geeks they didn't quite know what they were doing uh you know led by a very idealistic and driven founder
I think bezo said he's on version n of Amazon right now in terms of shipping and stuff like that
the publishing industry kind of woke up one morning and uh and found themselves in the grip of of Amazon and of Jeff Bezos
Amazon itself its stock price you know went through the roof and it exerted its Market power in all sorts of different categories
it's one of the greatest entrepreneurial success stories of our age