Amazon has come a long way since its inception in 1995. The technology company, which started with a $1,00,000 investment from its founder?s parents, is now considered among the big four of the tech universe?the others being Apple, Facebook and Google?with an annual turnover of over $50 billion. Today, Amazon offers its customers severely personalised homepages, with prices that send CEOs of established retailers like Wal-Mart scurrying to the white board. And, well, it sells practically everything.
The man behind this is Jeff Bezos. Born to a teenage mother, who soon left her husband for a more sincere and hardworking Cuban immigrant, Miguel Bezos, Jeff Bezos had a streak for excellence and science early on. He loved breaking and making things, and at the tender age of eight years, would often fall prey to the temptations of machine tools than his loving parents.
Following college at Princeton, Bezos worked at a Wall Street firm till the advent of the Internet in 1993. Among the first to seriously recognise the enormous capability of cyber space, Bezos struggled with the decision to leave a well-paying job at the firm to start his own online retail store. But like every great nerd, he developed his own musings to overcome the confusion. Imagine that you are your 80-year-old self, what would you regret not doing? Through this ?regret-minimisation framework?, Bezos realised that he would profoundly regret not trying to build an online store.
Amazon?s history, as Brad Stone recounts, has since then become the stuff of legend. Much like our home-grown online retailer, Flipkart, the website began with books, for they demand little product differentiation and, at the same time, offer almost unlimited diversity. The website went live on July 16, 1995, and procured orders worth $12,000 in the first week. Without any personnel or space for inventory, Bezos, his wife, and a few employees would receive the orders, then order the books from publishers and finally ship them off to the customers after spending nights packaging. Fifteen years later, this same company would operate hundreds of ?Fulfillment Centers? across America, Europe and Asia. In these warehouses, books would be stacked along with apparel, jewellery and shoes, and the movement of the hundreds of workers would be synchronised through mathematical algorithms.
For Stone, this remarkable journey has much to do with Bezos? temperament, and the inability of Amazon?s obvious competitors to understand the potential of the Internet. Like Steve Jobs and Bill Gates (and many other celebrated tech entrepreneurs of the past two decades), Bezos was a perfectionist, who would wildly berate his underlings for the smallest of hiccups. Unable to control the growth of the business, he would despise weekends (and the rare holiday they afforded to Amazon?s employees) and abhorred the work-life balance. He wanted for Amazon what Sam Walton did for Wal-Mart?to make it the everything store.
But Amazon had to overcome plenty of hurdles if it were to become the everything store. The first was passing the inevitable credit crunch following the dot-com crash. Amazon had ridden high and mighty much like the rest of the tech industry during the late 90s. Its stock price surpassed $100 and Bezos was slowly becoming a bit of a celebrity?he was TIME Magazine?s Person of the Year for 1999. But Amazon had not had a single substantive profitable quarter, and Bezos had used the dot-com mania?s credit splurge to focus on business expansion. The result was ruthless cost-cutting. Bezos used everything at his disposal?poaching managers from retail chains to math wizards, who designed algorithms on the basis of ?Big Data? to cut costs in storage and delivery.
Similarly, the inevitable backlash that would come from established ?physical? retailers like Wal-Mart and Barnes and Nobles was quietly dealt with by doubling down on Amazon?s core business. Bezos stayed true to his vision of making Amazon the platform, where customers could order anything and have a great experience doing so. Inventory management became slicker, while scores of engineers used the rich data mine of Amazon to accurately predict what additional books or garments visiting customers may be willing to buy. For Wal-Mart and Barnes, online retail was the extension of an already lucrative real retail network; for Amazon, online retail was its raison d?etre.
Nevertheless, the most interesting parts of the book involve crisp analyses of Bezos? work ethic and management style. A workaholic, Bezos is willing to put any number of hours needed to get the job done. Rejecting old-school management, he wants project groups to be able to act independently with minimal supervision from their superiors or the headquarters in Seattle. And perhaps most astoundingly, he has banned PowerPoints and Excel Sheets in favour of Word documents to better ?stimulate critical thinking? of his subordinates.
Thus, it is not surprising that one sees habitual rounds of employee revolts and desertions in Amazon?s history, with most feeling overworked and underpaid.
Nevertheless, what kept the Amazon dream alive was its founder?s vision and determination. Bezos had plenty of opportunities to sell off Amazon and cash out, but he persisted through the good times and bad. Through Stone, Bezos very clearly comes across as a tech entrepreneur of steely charisma, piercing determination and profound ability. Well within the respect and awe people usually reserve for the likes of Jobs or Gates.
Stone?s brilliant biography of Amazon?s founder should find space in the bookshelves of budding entrepreneurs, those who wish to understand the malleability of the tech industry better and those looking for a spectacularly-written biography of an over-achiever. Flipkart, are you listening?
Akshat Khandelwal is a writer based out of Delhi
