Read The Everything Store: Jeff Bezos and the Age of Amazon Online
Authors: Brad Stone
The Everything Store: Jeff Bezos and the Age of Amazon
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For Isabella and Calista Stone
When you are eighty years old, and in a quiet moment of reflection narrating for only yourself the most personal version of your life story, the telling that will be most compact and meaningful will be the series of choices you have made. In the end, we are our choices.
—Jeff Bezos, commencement speech at Princeton University, May 30, 2010
In the early 1970s, an industrious advertising executive named Julie Ray became fascinated with an unconventional public-school program for gifted children in Houston, Texas. Her son was among the first students enrolled in what would later be called the Vanguard program, which stoked creativity and independence in its students and nurtured expansive, outside-the-box thinking. Ray grew so enamored with the curriculum and the community of enthusiastic teachers and parents that she set out to research similar schools around the state with an eye toward writing a book about Texas’s fledgling gifted-education movement.
A few years later, after her son had moved on to junior high, Ray returned to tour the program, nestled in a wing of River Oaks Elementary School, west of downtown Houston. The school’s principal chose a student to accompany her on the visit, an articulate, sandy-haired sixth-grader whose parents asked only that his real name not be used in print. So Ray called him Tim.
Tim, Julie Ray wrote in her book
Turning On Bright Minds: A Parent Looks at Gifted Education in Texas,
was “a student of general intellectual excellence, slight of build, friendly but serious.” He was “not particularly gifted in leadership,” according to his teachers, but he moved confidently among his peers and articulately extolled the
virtues of the novel he was reading at the time, J. R. R. Tolkien’s
The Hobbit.
Tim, twelve, was already competitive. He told Ray he was reading a variety of books to qualify for a special reader’s certificate but compared himself unfavorably to another classmate who claimed, improbably, that she was reading a dozen books a week. Tim also showed Ray a science project he was working on called an infinity cube, a battery-powered contraption with rotating mirrors that created the optical illusion of an endless tunnel. Tim modeled the device after one he had seen in a store. That one cost twenty-two dollars, but “mine was cheaper,” he told Ray. Teachers said that three of Tim’s projects were being entered in a local science competition that drew most of its submissions from students in junior and senior high schools.
The school faculty praised Tim’s ingenuity, but one can imagine they were wary of his intellect. To practice tabulating statistics for math class, Tim had developed a survey to evaluate the sixth-grade teachers. The goal, he said, was to assess instructors on “how they teach, not as a popularity contest.” He administered the survey to classmates and at the time of the tour was in the process of calculating the results and graphing the relative performance of each teacher.
Tim’s average day, as Ray described it, was packed. He woke early and caught a seven o’clock bus a block from home. He arrived at school after a twenty-mile ride and went through a blaze of classes devoted to math, reading, physical education, science, Spanish, and art. There was time reserved for individual projects and small group discussions. In one lesson Julie Ray described, seven students, including Tim, sat in a tight circle in the principal’s office for an exercise called productive thinking. They were given brief stories to read quietly to themselves and then discuss. The first story involved archaeologists who returned after an expedition and announced they had discovered a cache of precious artifacts, a claim that later turned out to be fraudulent. Ray recorded snippets of the ensuing dialogue:
“They probably wanted to become famous. They wished away the things they didn’t want to face.”
“Some people go through life thinking like they always have.”
“You should be patient. Analyze what you have to work with.”
Tim told Julie Ray that he loved these exercises. “The way the world is, you know, someone could tell you to press the button. You have to be able to think what you’re doing for yourself.”
Ray found it impossible to interest a publisher in
Turning On Bright Minds.
Editors at the big houses said the subject matter was too narrow. So, in 1977, she took the money she’d earned from writing advertising copy for a Christmas catalog, printed a thousand paperbacks, and distributed them herself.
More than thirty years later, I found a copy in the Houston Public Library. I also tracked down Julie Ray, who now lives in Central Texas and works on planning and communications for environmental and cultural causes. She said she had watched Tim’s rise to fame and fortune over the past two decades with admiration and amazement but without much surprise. “When I met him as a young boy, his ability was obvious, and it was being nurtured and encouraged by the new program,” she says. “The program also benefited by his responsiveness and enthusiasm for learning. It was a total validation of the concept.”
She recalls what one teacher said all those years ago when Ray asked her to estimate the grade level the boy was performing at. “I really can’t say,” the teacher replied. “Except that there is probably no limit to what he can do, given a little guidance.”
In late 2011, I went to visit “Tim”—aka Jeff Bezos—in the Seattle headquarters of his company, Amazon.com. I was there to solicit his cooperation with this book, an attempt to chronicle the extraordinary rise of an innovative, disruptive, and often polarizing technology powerhouse, the company that was among the first to see the boundless promise of the Internet and that ended up forever changing the way we shop and read.
Amazon is increasingly a daily presence in modern life. Millions
of people regularly direct their Web browsers to its eponymous website or its satellite sites, like Zappos.com and Diapers.com, acting on the most basic impulse in any capitalist society:
to consume.
The Amazon site is a smorgasbord of selection, offering books, movies, garden tools, furniture, food, and the occasional oddball items, like an inflatable unicorn horn for cats ($9.50) and a thousand-pound electronic-lock gun safe ($903.53) that is available for delivery in three to five days. The company has nearly perfected the art of instant gratification, delivering digital products in seconds and their physical incarnations in just a few days. It is not uncommon to hear a customer raving about an order that magically appeared on his doorstep well before it was expected to arrive.
Amazon cleared $61 billion in sales in 2012, its seventeenth year of operation, and will likely be the fastest retailer in history to surpass $100 billion. It is loved by many of its customers, and it is feared just as fervently by its competitors. Even the name has informally entered the business lexicon, and not in an altogether favorable way.
To be Amazoned
means “to watch helplessly as the online upstart from Seattle vacuums up the customers and profits of your traditional brick-and-mortar business.”
The history of Amazon.com, as most people understand it, is one of the iconic stories of the Internet age. The company started modestly as an online bookseller and then rode the original wave of dot-com exuberance in the late 1990s to extend into selling music, movies, electronics, and toys. Narrowly avoiding disaster and defying a wave of skepticism about its prospects that coincided with the dot-com bust of 2000 and 2001, it then mastered the physics of its own complex distribution network and expanded into software, jewelry, clothes, apparel, sporting goods, automotive parts—you name it. And just when it had established itself as the Internet’s top retailer and a leading platform on which other sellers could hawk their wares, Amazon redefined itself yet again as a versatile technology firm that sold the cloud computing infrastructure known as Amazon Web Services as well as inexpensive, practical digital devices like the Kindle electronic reader and the Kindle Fire tablet.
“To me Amazon is a story of a brilliant founder who personally drove the vision,” says Eric Schmidt, the chairman of Google and an avowed Amazon competitor who is personally a member of Amazon Prime, its two-day shipping service. “There are almost no better examples. Perhaps Apple, but people forget that most people believed Amazon was doomed because it would not scale at a cost structure that would work. It kept piling up losses. It lost hundreds of millions of dollars. But Jeff was very garrulous, very smart. He’s a classic technical founder of a business, who understands every detail and cares about it more than anyone.”
Despite the recent rise of its stock price to vertiginous heights, Amazon remains a unique and uniquely puzzling company. The bottom line on its balance sheet is notoriously anemic, and in the midst of its frenetic expansion into new markets and product categories, it actually lost money in 2012. But Wall Street hardly seems to care. With his consistent proclamations that he is building his company for the long term, Jeff Bezos has earned so much faith from his shareholders that investors are willing to patiently wait for the day when he decides to slow his expansion and cultivate healthy profits.
Bezos has proved quite indifferent to the opinions of others. He is an avid problem solver, a man who has a chess grand master’s view of the competitive landscape, and he applies the focus of an obsessive-compulsive to pleasing customers and providing services like free shipping. He has vast ambitions—not only for Amazon, but to push the boundaries of science and remake the media. In addition to funding his own rocket company, Blue Origin, Bezos acquired the ailing Washington Post newspaper company in August 2013 for $250 million in a deal that stunned the media industry.
As many of his employees will attest, Bezos is extremely difficult to work for. Despite his famously hearty laugh and cheerful public persona, he is capable of the same kind of acerbic outbursts as Apple’s late founder, Steve Jobs, who could terrify any employee who stepped into an elevator with him. Bezos is a micromanager with a limitless spring of new ideas, and he reacts harshly to efforts that don’t meet his rigorous standards.
Like Jobs, Bezos casts a reality-distortion field—an aura thick with persuasive but ultimately unsatisfying propaganda about his company. He often says that Amazon’s corporate mission “is to raise the bar across industries, and around the world, for what it means to be customer focused.”
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Bezos and his employees are indeed absorbed with catering to customers, but they can also be ruthlessly competitive with rivals and even partners. Bezos likes to say that the markets Amazon competes in are vast, with room for many winners. That’s perhaps true, but it’s also clear that Amazon has helped damage or destroy competitors small and large, many of whose brands were once world renowned: Circuit City. Borders. Best Buy. Barnes & Noble.
