How would you feel if you lost $60.2-billion in one year?
That’s more money than most of us dream of earning if we won the lottery. However, it’s just another day at the office for the world’s richest man.
Bezos net worth toppled from $168-billion in 2018 to estimates of $107.8-billion in 2019 (according to Forbes), but he’s still 5-billion ahead of Bill Gates, who has the number-2 spot.
“One of the only ways to get out of a tight box is to invent your way out.”– Jeff Bezos
Jeff Bezos has plenty of his wealth tied up in the Amazon stock price, which is why his net worth tends to fluctuate. His recent divorce from his wife, Mackenzie Bezos, also cost him $38-billion, making Mackenzie the third richest woman in the world overnight.
Jeff Bezos: The Facts
- 1 Jeff Bezos: The Facts
- 2 The Early Days
- 3 The Rise of Amazon
- 4 Jeff Bezos – Master of Innovation
- 5 Doing the Math – Amazon and Global GDP
- 6 Jeff Bezos – The Keys to Amazons Success
- 7 Amazon and its Customer Obsession
- 8 Eagerness to Innovate
- 9 The Long-View
- 10 Standards of Operational Excellence – And Nothing Less
- 11 Jeff Bezos Routine for Success
- 12 Jeff Bezos Quotes
|Net Worth:||$110 Billion|
|📆 DOB:||January 11, 1964|
|🌎 Country of Origin:||United States of America|
|💲 Source of Wealth:||Amazon Founder|
The Early Days
Born on January 12, 1964, in Albuquerque, New Mexico, Jeff Bezos is now 54-years-old and living the high life as the world’s richest man. However, Bezos built the majority of his fortune over the last 15-years, making his ascent to the top spot all the more remarkable.
Bezos founded the retail giant, Amazon, from his tiny New York apartment in 1994. As you can imagine, the business experienced rapid expansion as the adoption of the internet started to reach its exponential tipping point.
It took him until 2017 to amass a fortune of $84-billion, which is no paltry sum. The crazy part about the story of his ascent to the top spot as the richest man in the world is that his net-worth doubled in only a year, moving from $84-billion to $168-billion by September 2018.
Today, Amazon is one of two American companies to surpass a trillion-dollar valuation, with the other being Apple.
Bezos attended Miami Palmetto High School, taking part in the Student Science Training Program at the University of Florida, where he received the coveted Silver Knight Award.
His work led him to attend Princeton University. After his graduation in 1986, he decided to start his career working on Wall Street as a computer science engineer for financial firms.
His success in the engineering community saw him head-hunted by Fitel, an international trading company, where he was critical in building the company’s network.
After leaving Fitel, Bezos found employment at Bankers Trust, and the hedge fund D. E. Shaw & Co, before going on to found Amazon in 1994.
The Rise of Amazon
It might surprise you to learn that is wasn’t all smooth sailing in the early days of Amazon. In 1994, Bezos started Amazon as a used online book store. It didn’t take long for consumers to latch onto ordering their books online, and Amazon’s inventory list started to grow rapidly. By 1998, Bezos managed to squeeze into the Forbes 400 list.
However, Amazon experienced heavy losses in its first 21-quarters of operations as a public company. During this period, the company still managed to produce a negative income of -$2.86 billion.
Most of us would struggle to comprehend owning a company with a loss as significant as this on its books, but not Bezos. While the company was writing up massive losses, the element that kept the CEO going was the fact that the bottom-line earnings continued to grow at a frenetic pace of 229%. Amazon moved from trading at over 40 times its sales during its peak, to a far more conservative number of 3.5 today.
We imagine that the majority of companies and CEOs that would see such a massive collapse in its multiples don’t do so because they hold on and grow into them. Instead, it occurs because they fail to meet investors’ sky-high expectations on performance.
However, Amazon seems to be the exception to the rule, with its earnings increasing 1400-times since the launch of its initial public offering.
Jeff Bezos – Master of Innovation
The secret to Jeff Bezos’s success comes from innovation. While he was quick to find early success with this online book store, what shot him to financial superstardom, was his ability to innovate. Innovators a special breed on business people, and they are the thought leaders in the business community.
Jeff saw an opportunity and moved into this space aggressively, refusing to accept defeat, even when his company was down billions of dollars. Instead, his resolve and his vision led him to persist through the early stages of Amazon until he finally tasted success.
Doing the Math – Amazon and Global GDP
In September 2018, Amazon became the second American company to achieve a trillion-dollar valuation. With this market cap, Amazon has a valuation that’s larger that’s worth more than 1% of global GDP, with the World Bank stating global GDP figures at over $80-trillion. Amazon also accounts for nearly 5% of Americas near $22-trillion in annual GDP.
While these figures are staggering, it’s even more shocking to learn that Amazons trillion-dollar valuation makes it larger than the GDP of more than 183 of 199-countries, according to data tracked by the World Bank.
If Amazon were a country, it would place 58th on the list of countries with the highest GDP, beating developed economies in countries like Sweden, Saudi Arabia, and the Netherlands.
In 2018, Amazon cited delivery figures of more than 5-billion packages to its Prime members alone. The e-commerce giant owns and leases more than 250-million square feet of real estate for its fulfillment centers.
The company employs more than 647,000 workers, making it the second-largest employer in the United States, behind Wal-Mart. If the trend of retail moving online continues, we can expect Amazon to rise to the largest employer of American workers in the near future.
Jeff Bezos – The Keys to Amazons Success
In 2018, Jeff Bezos sat down for an interview at the George W. Bush Presidential Center’s Forum on Leadership. In the interview, Bezos mentions that the success of the company depends on its commitment to four fundamental principles that form Amazon’s core values.
Before he started unpacking the key values, he mentioned that they play a core role in everything the company does in its operations and innovations. The following four key points are worth looking into in more detail.
Amazon and its Customer Obsession
Bezos started his speech on the keys of Amazon’s success by pointing out that most company’s focus on outdoing its competitors. What set Amazon apart was its focus on acquiring and retaining customers, rather than what its competition was doing at the time.
Bezos mentions that while most companies claim they focus on customer obsession, most of them are merely trying to compare their performance to other companies, rather than what drives its business – customers. He says that Amazons’ mindset from day one was to capture new customers and then keep them.
Bezos also mentions that by focusing on what other companies are doing, it stifles innovation, resulting in a different company mentality, and conflicting values that eventually catch up to the company’s bottom-line performance.
A competitor-focused business doesn’t grow in the long run, or it experiences periods of good customer growth, followed by periods of stagnation. They fail to innovate on current systems and customer acquisition processes, resulting in a decline in the company’s progress to its business goals.
Bezos finishes this section by mentioning that being a follower is no way to run a market-leading business, and the key to growth is innovation. As the world evolves in a technological environment, what made Amazon a success, was its ability to stay dynamic in a fluid business environment.
By remaining flexible in its approach, Amazon remained competitive as more customers came online to experience the start of the e-commerce revolution.
Eagerness to Innovate
Bezos started his second key to Amazon’s success by mentioning that too many companies focus on the problem rather than the solution. He states that the reason why Amazon was able to side-step its competition and continue to grow was due to its ability to innovate.
Instead of focusing on the areas of its business that were doing well, Bezos asked how he could create new products and services in vertical strategies. Amazon was the first retailer to offer free shipping, and this strategy led to the industry-wide adoption of the model to remain competitive with the retailer.
After the market adjusted to free shipping, Bezos continued with his innovation, offering free overnight shipping on orders of any value for Prime members. It was these changes in the company’s model that kept Amazon on the top of consumers lists as the retailer of choice, and it seems like he was a step ahead of the rest of the market at every turn.
When Netflix seemed poised to dominate the online streaming space, Bezos launched a streaming service as well, providing a similar offering, but with additional perks.
While Netflix was considered the market leader, Amazon’s offering of all the Prime perks associated with shopping kept it competitive. Along with its streaming services, the innovation allowed the company to experience continued growth, while the Netflix customer base started to flatten out.
In the interview, Bezos goes on to state that many management teams take a short-term outlook on the company’s growth. He says that a two to three-year outlook is not sufficient to allow for innovation and growth.
Focusing on the short-term never allows you to see outside the box, and the company ends up chasing its tail in the quest for innovation.
Bezos says that he and his management team prefer to take a five to seven-year outlook on bringing new ideas to market. By taking a longer-term perspective on growth and innovation, it prevents jumping from one idea to the next.
Instead, by working in a longer time-frame, Amazon has the opportunity to thoroughly test and vet each of its product offerings before it decides to commit to a new strategy.
Bezos also mentions that Amazon prides itself on its management team’s accountability. By surrounding himself with superstars, he leverages the thoughts of others, allowing their ideas to grow and blossom into multi-billion dollar strategies.
Ensuring that you have the right people challenging you at every turn with constructive criticism and ideas, avoids the financial fallout that occurs when you only have a team of “Yes-men” backing you.
Without a competent team to challenge your thinking, you could end up making a costly mistake that ends up setting back the growth of the company for years.
Standards of Operational Excellence – And Nothing Less
When wrapping up his interview, Bezos ends with what he calls the most crucial key to Amazon’s success. Implemented carefully thought-out systems into the business was what led to the rapid expansion of the company.
Every business needs systems to survive. Amazon put great care into every system it designs, from on-boarding employees to its logistics and management procedures. By building systems, you allow the company to work on autopilot, and you can focus on innovation rather than operations, he explains.
Jeff Bezos Routine for Success
In a separate interview, Bezos runs through his daily routine for success. He rounds it up to his consistency in executing his daily routine, which brings him the stability he needs to be the CEO of the world’s largest e-commerce retailer.
Early to bed, and early to rising – Jeff doesn’t stay up burning the midnight oil, and he wakes up at the same time, early each morning.
He gets family time – He eats breakfast with his family, often cooking for his kids. He occasionally does the dishes as well! Jeff admits to enjoying reading the newspaper with a cup of coffee as the ideal way to start his day.
He starts with important tasks first – Jeff organizes his most important meetings for 10 am, and he’s done by 5 pm every day.
He gets enough sleep – Bezos states that he doesn’t understand how other business people can manage on three to four hours of sleep a night. Jeff maintains a strict protocol of getting at least 8-hours of sleep each night.
Jeff Bezos Quotes
What we need to do is always lean into the future; when the world changes around you and when it changes against you – what used to be a tail wind is now a head wind – you have to lean into that and figure out what to do because complaining isn’t a strategy.
If you don’t understand the details of your business you are going to fail.
The key thing about a book is that you lose yourself in the author’s world.
The one thing that offends me the most is when I walk by a bank and see ads trying to convince people to take out second mortgages on their home so they can go on vacation. That’s approaching evil.
I don’t want to use my creative energy on somebody else’s user interface.