Amazon founder and CEO Jeff Bezos is stepping down as head of the world’s largest online retailer and transitioning to the role of Executive Chair on Monday. And it comes on the day Amazon was incorporated in 1994 and forever changed millions of lives.
“In the Exec Chair role, I intend to focus my energies and attention on new products and early initiatives,” Bezos told Amazon employees and investors in an email during the company’s annual shareholder meeting in February. “This journey began some 27 years ago. Amazon was only an idea, and it had no name. The question I was asked most frequently at that time was, ‘What’s the internet?’
“Blessedly,” he said. “I haven’t had to explain that in a long while.”
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While Bezos’ unquestionable impact on business can’t be understated, Amazon isn’t without its share of controversy. The company has been leveled with criticism over treatment of workers and controlling a monopoly that affects smaller businesses.
That said, as Andy Jassy takes over at Amazon, here are some of Bezos’ bigger moments on his way to building a dynasty named after the largest river on the planet. His company is worth nearly $1.8 trillion.
It all started in a Seattle garage
Before Amazon transformed into an e-commerce juggernaut that changed the way we read, eat and shop, the company had humble beginnings inside Bezos’ garage in Seattle in 1994 after he quit his job as the youngest senior vice president at D.E. Shaw, a Wall Street hedge fund. It was Bezos’ fascination with the internet that eventually led him to create Amazon.com, then an online bookstore with almost a dozen employees, including his wife and a couple of programmers.
Success came soon after “Fluid Concepts and Creative Analogies” by Douglas Hofstadter became the first book sold online by Amazon.com. By mid-1995, Amazon was selling books in all 50 U.S. states and in 45 countries around the world. Little did we know there was more to come. In that first year, Bezos reportedly said Amazon would earn more than $70 million by 2000.
The company, which went public in 1997, and survived the dot-com bubble burst in the late 90s, reportedly raked in $3 billion by 2001. But it did not post a profit until the last quarter of 2002.
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And Amazon hasn’t stopped making money. Today, about half of all online purchases come through Amazon. For more context, Amazon’s revenues have escalated from $148 million in fiscal year 1997 to $386 billion in fiscal year 2020. The company is number two on this year’s Fortune 500 list.
And, Bezos’ net worth is an estimated $203 billion, according to Bloomberg’s Billionaires Index.
Bezos will be remembered with a mix of admiration and distrust, said William Kovacic, a former chairman with the Federal Trade Commission (FTC) and a current law professor at George Washington University.
“This entrepreneur, who created a new concept for retailing, who persevered in creating a new pather for goods and services to individuals, and enormous difficulties, made it big beyond our wildest beliefs,” Kovacic said.
“I can recall the commentary about Bezos from the late 1990s into the early 2000s,” Kovacic added. “They said something to the effect of ‘Let’s take bets when this all starts crashing into the ground.’
“Well, we’re still waiting.”
Amazon grows and grows
As Amazon grew, the company began to expand into other ventures beyond books. In September 1997, the company changed the way we shop with its 1-Click purchasing.
In 2005 came Amazon Prime, with users paying a subscription fee for certain options, including giving subscribers access to free two-day and same-day delivery. Other perks, including Amazon Instant Video, Prime Music, and Prime Photos, soon followed.
While Amazon usually doesn’t often release figures, Bezos said in a letter to shareholders in April that Prime has 200 million users – 50 million more than in 2020. Prime is so big that its annual Prime Day, an actual two-day spectacular of sales, is imitated by other major retailers including Walmart and Target.
In 2006, Amazon created Amazon Web Services (AWS), the commercial cloud computing division that many companies use and that incoming CEO Andy Jassy helps build. AWS brings in billions, making it even bigger than Amazon’s e-commerce sales. Bezos told shareholders that AWS raked in some $45 billion during a pandemic-plagued 2020, a 30% year-over-year increase compared to 2019.
“The timing of this transition is interesting, as the world seems to be towards the tail-end of a terrible global pandemic,” said Scott Kessler, global sector lead at Third Bridge, a consulting firm that works with private equity firms and investors “Perhaps at the same time, Amazon’s e-commerce business normalizes somewhat, as people return more to retail stores, the AWS segment will become increasingly important with continuing momentum around cloud transitions and digital transformations.”
While AWS is Amazon’s most profitable venture, Bezos has been at the helm of some of the company’s most ingenious gadgets. They range from the best-selling Kindle e-reader created in 2007 that gives readers access to millions of best-selling books, the Amazon Fire tablet in 2011 that was seen as a cheaper alternative to Apple’s iPad.
The year 2014 not only brought the Amazon Fire TV Stick, that inexpensive thumb-shaped dongle that plugs into flat-screen TVs that now allows users to watch almost anything, to Alexa, the omnipresent voice assistant that debuted in the first Echo speaker and gives Siri, Apple’s voice assistant, a vociferous rival that users can also talk to.
Alexa is in almost everything from smart TVs, watches, headphones, speakers, alarm clocks, light bulbs, and even shower heads as it has been licensed to other hardware manufacturers. And, how many Echo devices are there?
“How did that happen? Invention. Invention is the root of our success. We’ve done crazy things together, and then made them normal,” said Bezos in that February email. ” If you get it right, a few years after a surprising invention, the new thing has become normal. People yawn. And that yawn is the greatest compliment an inventor can receive.”
Sure there were some duds (like the Fire smartphone), but the successes far outweigh the few product failures.
And if you didn’t invent it, perhaps you can buy it like when Amazon bought streaming platform Twitch (which turned 10 this year) in 2014, organic grocer Whole Foods for a reported $13.7 billion in 2017 and smart video doorbell and security camera maker Ring for $1 billion in 2018.
Among Amazon’s more recent blockbuster deals was its acquisition of MGM, the movie and TV studio for $8.45 billion to have a foothold in a highly competitive market for streaming services.
“If you want to be successful in business (in life, actually), you have to create more than you consume. Your goal should be to create value for everyone you interact with,” said Bezos in a letter to shareholders in April. “Any business that doesn’t create value for those it touches, even if it appears successful on the surface, isn’t long for this world. It’s on the way out.”
However, Amazon is no angel in the eyes of antitrust regulators. No fewer than five entities including the U.S., Canada, the E.U., and a citizens group in India are conducting antitrust investigations accusing Amazon of monopolizing the online business industry.
Additionally, Amazon is one of the companies frequently criticized by some workers, activists and lawmakers who said its employees were overworked and denied adequate wages and protections to safeguard their health.
Last month, the International Brotherhood of Teamsters passed a resolution that will make supporting Amazon workers and helping them attain a union contract a key goal.
In April, a group of Amazon warehouse workers in Bessemer, Alabama overwhelmingly rejected a proposal to join the Retail, Wholesale and Department Store Union.
While Amazon and some business groups praised the vote’s outcome, labor advocates said the Bessemer vote highlighted how difficult it is to organize as well as the pressures put on workers to reject union membership.
Bezos acknowledged in that letter to shareholders in April that Amazon “needs to do a better job for our employees.”
“While the voting results were lopsided and our direct relationship with employees is strong, it’s clear to me that we need a better vision for how we create value for employees — a vision for their success,” Bezos wrote.
Amazon also said in a statement that it vowed to improve worker treatment as well.
“Our employees are the heart and soul of Amazon, and we’ve always worked hard to listen to them, take their feedback, make continuous improvements, and invest heavily to offer great pay and benefits in a safe and inclusive workplace,” the company said. “We’re not perfect, but we’re proud of our team and what we offer, and will keep working to get better every day.”
Bezos, smart and shrewd investor
Over the past few years, Bezos has bounced back and forth between Bill Gates, Warren Buffett, Elon Musk and Bernard Arnault, to name a few, as the world’s richest person. As a majority of the Amazon founder’s fortune lies in his stock of the company, Bezos has made significant investments, according to Bezos Expeditions, his investment firm.
Bezos was one of the first shareholders in fellow tech giant Google and has invested in other big tech companies including Twitter, Uber, and Airbnb. And while he has invested in media platforms including Business Insider, Bezos is known for purchasing the Washington Post for $250 million in 2013.
Perhaps Bezos’ biggest investment outside of Amazon is creating Blue Origin, an aerospace exploration company that he has poured billions into all in preparation to fly into out space with his New Shephard rocket with at least three other passengers on board on July 20. Bezos is in a space race of sorts with fellow billionaires Musk and Richard Branson, who said he’s going to be Bezos into space.
“What do you do when you have no more worlds to conquer? You go to outer space,” Kovacic, the former FTC chair, wonders.
Robert Sutton, a professor and organizational psychologist at Stanford University, adds, “(Bezos) is obviously brave or he’s overconfident. It all depends on how you look at it.”
Nonetheless, Bezos isn’t going that far away from the company he spent nearly three decades to make one of the most powerful businesses on the planet.
“Being the CEO of Amazon is a deep responsibility, and it’s consuming. When you have a responsibility like that, it’s hard to put attention on anything else,” Bezos said in February.
“As Exec Chair I will stay engaged in important Amazon initiatives but also have the time and energy I need to focus on the Day 1 Fund, the Bezos Earth Fund, Blue Origin, The Washington Post, and my other passions,” Bezos continued. “I’ve never had more energy, and this isn’t about retiring. I’m super passionate about the impact I think these organizations can have.”
Jessica Guynn, Charisse Jones, Kelly Tyko, Brett Molina, Mike Snider and Jefferson Graham contributed.