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 11 Lessons for Entrepreneurs From Jeff Bezos's
Tremendous Success
As the Amazon founder exits the CEO role, he leaves his successor a set of rules that might be helpful to any entrepreneur bent on conquering the known universe.
Given what we know now, the trajectory of Jeff Bezos seems almost inevitable. The founder and CEO of Amazon has been relentless in his pursuit of building the most dominant, customer-focused enterprise in modern history. It's fitting, considering he first thought to name his company
Looking backward, however, it can be easy to forget that relentless did not mean inevitable, at least not in the early years. But as Amazon's execution began to match Bezos's vision, an extraordinary company emerged--one that changed our lives. Bezos leaves his CEO role as one of the most important business leaders of his generation, having taken his company from zero to nearly $1.7 trillion, the market value of Amazon today. Along the way, the man behind "The Everything Store" gave us some of the most important lessons on entrepreneur- ship, innovation, and customer experience. Here are 11 principles every entrepreneur can learn from Jeff Bezos.
1. Use the regret minimization framework.
When Bezos first entertained the idea of moving across the country to start an online bookstore, he used a mental exercise he calls a "regret minimization frame- work." The idea was to think about turning 80 and looking back on his life. "I want to have minimized the number of regrets I have," Bezos has explained. "I knew that when I was 80, I was not going to regret having tried this. I was not going to regret trying to participate in this thing called the internet that I thought was going to be a really big deal."
2. Find the right opportunity.
Bezos decided to build an internet business first, not a book business. He had been working in New York City for D.E. Shaw, the investment firm, when he heard that internet use was growing at an annual rate of 2,300 percent. His math, in fact, was grossly incorrect. The internet was growing by a factor of 2,300, meaning it was actually growing at a rate of 230,000 percent. That math worked too.
Bezos was not especially fond of books, but books seemed like the best bet to take advantage of the inter- net's explosive growth. In 1994, the year Amazon launched, the catalog of available books in print was effectively infinite, with more than three million titles--a long-tail business well suited to e-tailing. Shipping books was also relatively easy and not terribly expensive. As a place to start, the idea just made sense.
3. Be customer-obsessed.
Many companies preach the gospel of customer focus.
Credit: Austin Hargrave/August
Bezos lived it. "The secret sauce of Amazon--there are several principles at Amazon--but the number one thing that has made us successful, by far, is obsessive, com- pulsive focus on the customer," Bezos told David Ruben- stein in a 2018 interview at the Economic Club of Wash- ington, D.C.
He wasn't talking about feel-good service. It was more about creating a company people couldn't live without. "From the beginning, our focus has been on offering our customers compelling value," he wrote in Amazon's 1997 letter to shareholders.
"Compelling" also meant clear. One often-cited example was Bezos's insistence that for every new product, the team write a six-page memo and include a sample press release. "We don't do PowerPoint (or any other slide-ori- ented) presentations at Amazon," Bezos once wrote. "Instead, we write narratively structured six-page memos. We silently read one at the beginning of each meeting in a kind of 'study hall.' "
Bezos believes that the narrative style of the format clarifies the strategy, and that by writing the press release at the outset, the team was forced to think about whatever they were doing through the lens of the customer's first encounter with the product.
4. Make your value exceed all the costs.
In the early days of e-tailing, ordering anything online was a terrible experience for both sellers and buyers. Only about one-third of households had computers, and they were slow. Even fewer of those households had internet access. The websites that existed were just bad.
If you were going to persuade someone to get on a com- puter, dial up an internet connection, and buy, you had better offer something they couldn't get anywhere else. The experience had to create enough value--by offering low prices, limitless selection, and flawless fulfill- ment--that it would overcome the early barriers of buying online.
Even as the web became easier to access, the question remained: Does your site make your customers' lives easier or better in some tangible way? If so, they'll probably buy just about anything from you. In Amazon's case, that's almost exactly what happened.
5. Fear customers, not competitors.
Don't be afraid of our competitors, because they're never going to send us money, Bezos once told his team. "Be afraid of our customers, because those are the folks who have the money." In other words, focus your worry where it really matters. (continued on page 14)

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