From this WSJ description of Jeff Bezos, you can tell he is an amazing entrepreneur. The article is wonderful. Here are some of the facts:
- Named Cadabra until someone accidentally called it “cadaver,” Amazon was launched in Seattle on July 16, 1995.
- Founder Jeff Bezos had employees wrapping books on the floor until (he said) an employee had “the most brilliant idea I had ever heard in my life.” Buy tables.
- Fueled by 10% to 30% discounts, daily volume slowly grew until Yahoo put Amazon on its “What’s Cool” page.
- Urged to speed through emails when business skyrocketed, the fastest employees could do 12 a minute.
- Asked about employees sharing ideas, Bezos replied, “No. Communication is terrible.”
- To minimize “groupthink,” he implemented the “two-pizza team” rule.
- Bezos recently patented being able to return gifts before receiving them.
For more about what makes an entrepreneur, you might enjoy reading this Wired, Jonah Lehrer article.
The Economic Lesson
Joseph Schumpeter (1883-1950) said that entrepreneurs propelled capitalism through creative destruction. New ideas destroyed the status quo but led to economic growth. The auto killed the buggy whip. The transistor replaced the vacuum tube. And Amazon has eradicated the large booksellers and transformed publishing.
An Economic Question: Why do you think the large booksellers like Barnes & Noble would have had difficulty copying with Amazon’s innovations?