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How Jeff Bezos Built Amazon

Jeff Bezos became a mythical figure in

the business world long before he

surpassed Bill Gates is the richest

person on earth from humble beginnings

Bezos has built the largest commerce

company in human history Amazon but

years before Bezos net worth surpassed

100 billion dollars he was the troubled

son of a teen mom in Houston Texas from

here it didn't take long for Bezos to

turn his life around and build an

e-commerce juggernaut

though much has been written about his

habits and managerial style few people

know about his past today we are

exploring how Jeff Bezos built Amazon

but before we dissect his approach to

business let's consider Bezos

challenging childhood he was born

Geoffrey Preston Jorgenson to a 17 year

old mom and a dad who owned a local bike

shop while Bezos doesn't speak much

about his dad who was only 18 at the

time Jeff was born a few things are

clear first he only agreed to marry

bassist mom after he found out she was

pregnant the marriage lasted only 17

months reports Brad stone at Bloomberg

Businessweek her mom moved in with her

parents because Jorgensen stayed out

late and drank too much and was

generally an inattentive father and

husband says stone he agreed to a

divorce and paid a small amount of child

support to be say when he had money

other times he missed the payments

three years after their divorce case and

married another man Miguel Bezos a Cuban

immigrant who taught himself English and

eventually worked at Exxon Miguel

adopted Jeff and Jeff took his last name

Jorgensen had to sign off on the name

change which he did stone reports for a

brief period Jorgenson remembered the

Bezos name but through the years he

forgot about it and dropped completely

out of touch with his ex-wife and his

son druggin son's absence from Bezos

life was so complete that in a 1999

interview with Wired Bezos said of

Jorgenson I've never met him although in

reality he lived with him for the first

year of his life the reality as far as

I'm concerned is that my dad is my

natural father the only time I ever

think about it genuinely is when a

doctor asks me to fill out a form said

Bezos in 1999 Jorgensen for his part had

a nearly identical attitude about Bezos

however stone managed to find Jorgensen

now 69 who owns a bike shop in Glendale

Arizona according to the man who tracked

him down he had no idea what I was

talking about Jorgensen said he didn't

know who Jeff Bezos was and was baffled

by my suggestion that he was the father

of this famous CEO stone jaw Jorgenson's

memory trotting out details about Bezos

and his mother says stone the old man's

face flushed with recognition is he

still alive he asked not

yet fully comprehending despite jeff

bezos already being one of the most

successful businessmen in the world

Jorgensen didn't remember he existed let

alone that he was the father of a

billionaire Jorgensen says that in his

younger days he wasn't a good father or

a husband he eventually quit drinking

got his act together and open his bike

shop he's married but he had no other

children in his life beyond Bezos and

this is just to illustrate the

tumultuous relationship Bezos had with

his father growing up but that isn't to

say that Bezos wasn't part of a happy

home Bezos recently tweeted I won the

lottery with my mom thanks for literally

everything mom it's clear that she and

his adoptive father were very caring and

supported throughout his life Bezos was

industrious from a very young age and

describes working with his grandparents

on their farm I helped fix windmills

vaccinate cattle and do other chores we

also watched soap operas every afternoon

especially Days of Our Lives said Bezos

from an early age Jeffrey displayed as

striking mechanical aptitude even as a

toddler he asserted himself by

dismantling his crib with a screwdriver

he also developed intense and varied

scientific interests rigging an

electrical arm to keep his younger

siblings out of his room and converting

his parents garage into a laboratory for

his science projects when he was a

teenager the family moved to Miami

Florida in high school in Miami Jeffrey

first fell in love with computers an

outstanding student he was valedictorian

of his class

after spending a miserable summer

working at McDonald's as a team Bezos

together with his girlfriend started the

dream Institute a 10-day summer camp for

kids they charged $600 a kid and managed

to sign up six students the Lord of the

Ring series made the required reading

list at Miami Palmetto Senior High

School Bezos Excel and was invited to

participate in the student science

training program at the University of

Florida where he won a silver Knight

award in 1982 he graduated as the

school's valedictorian in the National

Merit Scholar and went on to Princeton

University with an interest in space

exploration he initially planned to

study physics but he soon gave it up

so Bezos turned to his love of computers

creating a number of software programs

while at the school he found the field

to his liking and graduated summa

laude with a Bachelor of Science degree

in electrical engineering and a second

one in computer science he stood out

from the rest of his class by his

presence in honor societies Phi Beta

Kappa and Tau Beta Pi as well as his

tenure as president of the school's

chapter of students for the exploration

and development of space

graduating in 1986 when the internet was

known by very few Bezos seemed to have

already had a sense of its possibilities

the time he turned down offers from a

number of large prestigious corporations

taking a position at fight on a

relatively young fiber optic company

where he would help build computer

network for international finance he

stayed in the finance realm with Bankers

Trust rising to a vice presidency at de

sha firm specializing in the application

of computer science to the stock market

Bezos was hired as much for his overall

talent as for any particular assignment

while working at Shaw Jeff met McKenzie

Tuttle also a Princeton graduate they

began dating and were married in 1993

Bezos rose quickly at siya becoming a

senior vice president and was looking

forward to a bright career in finance

when he made a discovery that changed

his life and the course of business

history at this point Bezos could easily

have continued his career in the finance

sector the job was well paying by

comparison to most work though his

salary was minuscule compared to his

current income in 1994 Bezos read that

the web had grown 2,300 percent in one

year this number astounded him and he

decided he needed to find some way to

take advantage of its rapid growth

he made a list of 20 possible products

to sell online and decided ebooks were

the best option this was the birth of

amazon.com speaking about the decision

Bezos said when you're in the thick of

things you can get confused by small

stuff I knew when I was 80 that I would

never for example think about why I

walked away from my 1994 Wall Street

bonus right in the middle of the year at

the worst possible time the kind of

thing just isn't something you worry

about when you're 80 years old at the

same time I knew I might sincerely

regret not having participated in this

thing called the Internet but I thought

was going to be a revolutionising event

when I thought about it that way it was

incredibly easy to make the decision he

named the company Amazon after the

Amazon River because it was massive

monolithic and powerful all qualities he

wanted his business to have he accepted

an estimated 300 thousand dollars from

his parents and invested in Amazon he

weren't many early investors that there

was a 70% chance that Amazon would fail

or go bankrupt

although Amazon was originally an online

bookstore Bezos has always wanted to

expand to other products

three years after Bezos founded Amazon

he took it public with an initial public

offering in response to critical reports

from fortune and Barons Bezos maintained

that the growth of the Internet would

overtake competition from larger book

retailers such as borders and Barnes and

Noble

two years later the market value of

shares in Amazon was greater than that

of its two biggest retail competitors

combined and Borders was striking a deal

for Amazon to handle its Internet

traffic

we weren't betting on the internet his

mother said we were betting on Jeff by

the end of the decade as six percent

owners of Amazon they were billionaires

for several years as much as a third of

the shares in the company were held by

members of the Bezos family when the

dot-com crash came analysts called the

company Amazon bomb but it weathered the

storm and ended up being one of the few

startups that wasn't wiped out by the

dot-com bust in 1998 Bezos diversified

into the online sale of music and video

by the end of the year he had also

expanded the company's products to

include a variety of consumer goods

Bezos used the 54 million dollars raised

during the company's 1997 equity

offering to finance aggressive

acquisition of smaller competitors in

2002 Bezos led Amazon to launch Amazon

Web Services which compiled data from

Weather Channel's and website traffic in

late 2002 rapid spending from Amazon

caused it financial distress when

revenues stagnated in 2000 Bezos

borrowed two billion dollars from banks

as its cash balances dipped to only 350

million after the company nearly went

bankrupt he closed distribution centers

in laid off 14% of VMs on workforce in

2003 Amazon rebounded from financial

instability and turned a profit of 400

million dollars in the early days Bezos

was a demanding boss and could explode

at employees rumor has it he hired a

leadership coach to help him tone it

down

Bezos was notoriously hard on his

employees and extremely strict when it

came to making new hires he would ask

applicants to share their SAT scores and

even asked a CFO candidate who had

ranked number two in the CPA exam why

she hadn't come in first there's nothing

wrong with asking for SAT scores Bezos

told The Washington Post he also often

conducted hour-long reference checks on

potential hires himself asking 23

standard questions including can you

think of a problem that everyone thought

was unsolvable that you personally

solved if this person were really

brilliant you can remember these things

if they can't think of anything it

doesn't mean they're not brilliant but

it's certainly a negative indicator

Bezos said Bezos is also known for

banning PowerPoint presentations in

Amazon instead he requires his staff to

turn in papers of a specific length on

their proposals to encourage critical

thinking over simplistic bullet points

Bezos maintains the email address Jef at

amazon.com has an outlet for customers

to reach out to him in the company

although he does not respond to the

emails he forwards some of them with a

question mark in the subject line two

executives who attempt to address the

issues Bezos has cited Warren Buffett of

Berkshire Hathaway

Jamie Dimon of JPMorgan Chase and Bob

Iger of Walt Disney as major influences

on his leadership style and Bezos has a

few core philosophies that have buoyed

is success for instance Amazon is

focused like a laser on customers

instead of starting with an idea for a

product and trying to convince

executives that customers will love the

idea Amazon worked from the perspective

of the customer to come up with ideas

that will legitimately generate value

for example Prime was created because it

was understood within Amazon that

customers wanted to buy quality products

for less money and customers wanted to

receive products as fast as possible

prime appeared to be a solution that

would meet both of these customer needs

regardless of his own orthodoxson

sometimes controversial methods things

worked out for Bezos in Amazon his

strategy involved reinvesting all of

Amazon's capital back into the business

this made investors nervous as Amazon

didn't turn a significant profit for

most of its existence but Bezos was

right to make this gamble Amazon is

currently worth more than one trillion

dollars and shows no signs of slowing

down even as other heavy hitters like

Apple and Facebook falter Bezos personal

net worth has been hovering around 150

billion dollars comfortably making him

the richest man in the world

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