August 27, 2014
The Everything Store
Posted on Nov 1, 2013
By Bethany McLean
“The Everything Store: Jeff Bezos and the Age of Amazon”
“Explosive.” That’s how the cover of Bloomberg Businessweek bills “The Everything Store” by journalist Brad Stone. That’s an overstatement—but the meticulously reported book has plenty of gems for anyone who cares about Amazon, Jeff Bezos, entrepreneurship, leadership or just the lunacy it took to build a company in less than two decades that now employs almost 90,000 people and sold $61 billion worth of, well, almost everything last year.
From moment one, Bezos, who named his company after the river that “blows all other rivers away,” had what Stone calls a “limitless spring of new ideas,” and Amazon has already seen boom, bust and boom—as well as both fawning adulation and deep skepticism.
Stone recounts how he pitched Bezos on the idea of a book. Bezos—who eventually encouraged friends, family and executives to talk to Stone, but didn’t himself cooperate—asked the author how he was going to deal with the concept of “narrative fallacy.” He was talking about Nassim Nicholas Taleb’s contention in his book “The Black Swan,” which is required reading for all Amazon senior executives, that humans use narrative to turn “complex realities into soothing but oversimplified stories.”
It’s hard to accuse “The Everything Store” of being overly simplistic, perhaps because Bezos defies easy description. While he had an ordinary childhood with his mother and stepfather, his real father was a onetime circus performer whom his mother told to stay out of their lives when Bezos was just 4. (Stone tracked down the lost father and discovered that the man had no idea who his son had become.)
At 3, Bezos took his crib apart with a screwdriver because he insisted on sleeping in a bed.
After graduating from Princeton in 1986, he found his way to the computer-driven hedge fund D.E. Shaw. He walked away before bonus time to found Amazon, helped by what he calls his “regret-minimization framework.” What will be unimportant when you’re 80? And what will you regret?
Bezos comes across as a polarizing figure who has inspired many people but traumatized others. Some of his ideas are so crazy that employees call them “fever dreams,” and his rants are so deranged that internally they are known as “nutters.” Stone describes Amazon’s culture as “notoriously confrontational, and it begins with Bezos, who believes that truth springs forth when ideas and perspectives are banged against each other, sometimes violently.” He can be kind, but is volatile and unsparing of those who make mistakes. Stone collected a list that he calls Bezos’ “greatest hits.” They range from: “Does it surprise you that you don’t know the answer to that question?” to: “Why are you ruining my life?”
He is also a man of many contradictions. While his fans say he is distinguished by his relentless quest for truth, Stone calls the happy platitudes that Bezos generally uses to explain his company to outsiders “Jeffisms.” Internally, top executives who are selected to implement Bezos’ ideas are derisively known as “Jeff Bots,” which is not exactly a sign of a healthy, open corporate culture. Amazon has developed a reputation for incredible ruthlessness, stemming from its less-than-straightforward dealings with publishers along with programs such as “the Gazelle Project,” so named because Bezos once suggested that Amazon should approach small publishers the same way a cheetah approaches a sick gazelle. Stone quotes an observer as saying that Amazon executives “have an absolute willingness to torch the landscape around them to emerge the winner.”
And yet, Bezos recently wrote a memo to his top leadership called Amazon.love in which he talked about the importance of Amazon being a company that is loved, not feared. The business-philosophy book “The Monk and the Riddle” talks about missionaries, who have righteous goals and are trying to make the world a better place, versus mercenaries, who are out for money and power and will run over everything in their way. “I would take a missionary over a mercenary any day,” Bezos says. Of course, most mercenaries think they are missionaries. (Just ask former Enron chief executive Jeff Skilling.)
While Bezos seems to be monomaniacal about his company, he also has absorbing outside interests, including the Clock of the Long Now, which is aimed at measuring time for 10,000 years; his space-exploration company Blue Origin; and most recently, his purchase of The Washington Post. Not incidentally, Bezos made an entirely separate fortune as one of the first investors in Google, which would eventually become one of Amazon’s frenemies.
Nor is Amazon a simple success story. Its stock, which hit a high (adjusted for splits) of almost $107 per share in the first dot-com boom, plunged to below $6 in the wake of the bust—almost living up to the nickname Amazon.bomb, famously bestowed on it by Barron’s—but has since soared to more than $300 per share. The process of getting all of us everything we order, on time, is a fiendishly complex one, and Amazon’s internal systems were worse than anyone ever suspected. Stone recounts how, during the hell of the 1999 holidays, Amazon’s employees staffed customer-service lines and worked in distribution centers, where some later swore the situation was so desperate that they were working among furloughed prisoners. (Stone notes that’s hard to prove.) The entire distribution system got jammed up by a missing pallet of Pokemon Jigglypuffs, which was finally found at 2 a.m.
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