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his view was you know what Amazon was trying to do is really hard and as a result it was going to be very difficult for somebody else to replicate it and so yes it was expensive and there was this huge scaling cost but that was actually an asset
mark didn't believe the future the company was in banner ads so he basically said let's outsource that to Microsoft
I negotiated a deal with Microsoft along with Owen and a couple of other folks, they valued the company at fifteen billion dollars right and that was one of the greatest investments Microsoft ever made
yahoo reported their quarterly earnings and the stock went down and they refused to change the equity that they were offering so the value of the equity was now something like 850 million right and Facebook went to them and said hey you gotta increase the equity to make up for the difference and Terry Semel said absolutely not the deal is the deal and Mark said that's it we're done and never look back
uber now cutting cost massively getting out of money losing businesses did 1.7 million deliveries and rides lost like a billion so they're losing something in the you know whatever twenty five cents per ride why is everybody convinced that their business is broken if they could simply raise prices like Amazon did twenty five cents or fifty cents right which would make no difference in consumption or a little to no difference I just think it takes time for these things to play out
Google had proven that ads are not bad mm-hmm irrelevant ads are bad relevant ads are actually good and incontinence search yeah their content and in search if he took the ads away and we had a lot of people who joined us from from Google who told us this when they ran experiments where they took the ads away people complained oh yeah the ads are additive to the user experience
Google you're typing in Volvo San Francisco you know Indian food Palo Alto I mean the intent on Google is insane the monetization is absurd
what Google had that Amazon didn't have was a high margin advertising business amazon's margins were like 3% and googles were like 60%
I had gone through the experience at Amazon where the stock had gone from 130 to six dollars
what eBay had that Amazon didn't have was network effects Amazon was a retailer eBay was a marketplace and what Google had that Amazon didn't have was a high margin advertising business
Amazon's margins were like 3% and googles were like 60%
he said in the early 1900s if in order to start a company you had to build an electric power grid to power your store or your building and he said it's crazy that today in order to start a company you have to build your own datacenter there's no reason why that should be the case and we're gonna we're gonna fix that
there were smart people at the time you know real analysts on Wall Street who really believed and and had a legitimate argument that Amazon was six months away from going out of business
If they could simply raise prices like Amazon did
that AWS business coming out of nowhere and beating Google Microsoft IBM Rackspace
the loyalty of people there is phenomenal and the ownership he gives people is phenomenal
it's not for everyone who's it's tough it's for people who are hyper competitive who are builders
it was not obvious that the company was going to emerge from that from that crisis
invest in an event in ways that Amazon is you know maybe the best in the world ever at doing which is really where Bezos shines
he had Jeff Wilkie at the time we had brought in who was an exceptional operator now runs the retail business who really played a big role on this
I think his ability to surround himself with a leadership team if you look at that leadership team today most of the people on that team have been at the company from the time that I joined in 1999 deadly blade children Jeff Wilkie Andy Jesse these people have been at the company for 20 plus years
you work for somebody like that and you realize this may be the greatest business person ever
the muscle that Amazon built during that really tough time was the ability to run a massive operation in a disciplined organized way
he launches in 2004 in the middle of all that AWS and the kindle to massive new bets one of which was designed to destroy the existing business and the other of which nobody thought Amazon had any right in the world to be working on it was crazy he did it in the middle of it
they shifted out of being reliant on Sun Microsystems and moved to Linux which was really the seeds of what ended up becoming AWS
very few layoffs raise prices was the big one and that was a tough pill to swallow the company's growth stalled out actually oh it in that time frame growth went down to single digits
he turned this massive ship on a dime it took about 18 months it was not easy went from losing over a billion dollars a year at the height of you know the the bubble popping to being capable of you know generating positive cash flows which was a remarkable feat
he internalizes that stuff and he he just lives it and so you know he immediately shifted into we're gonna build this thing as fast as we can get as big as we can because that's our protection against competition
I think he's an absolute visionary and he's a strategic machine... he immediately realized that this was a much bigger idea and pivoted to get big fast and build a moat
his view was you know what Amazon was trying to do is really hard and as a result it was going to be very difficult for somebody else to replicate it and so yes it was expensive and there was this huge scaling cost but that was actually an asset
I stayed because of Bezos, I really believed in this guy
Amazon was the hottest company on the planet