Jeff Bezos

American businessman

• Born: January 12, 1964
• Place of Birth: Albuquerque, New Mexico

Jeff Bezos, an internet innovator and pioneer, revolutionized the way that consumers shop and make purchases using the internet. The company he founded, Amazon, has become one of the largest and most successful shopping sites.

Early Life

Jeff Bezos was born in Albuquerque, New Mexico, to Jacklyn Gise. Jacklyn’s marriage to Jeff’s birth father, Ted Jorgensen, lasted less than a year after Jeff was born, and when Bezos was five years old, his mother married Miguel Bezos, a Cuban refugee, and took his surname.

Bezos spent summers on his grandfather’s twenty-five-thousand-acre cattle ranch in New Mexico and developed an appreciation for science and hard work. He showed an early interest in science and technology while tinkering in the family’s garage in Houston, where his stepfather worked as an executive for Exxon. As a teenager, Bezos wanted to be an astronaut or physicist. His family later moved to Miami, Florida, where Bezos attended high school and graduated at the top of his class. He attended Princeton University and graduated with high honors in 1986 with a bachelor of science degree in electrical engineering and computer science.

After graduating from college, Bezos accepted a position with Fitel, a high-tech start-up company, where he created software to track international stock trades. In 1990, he took a position with the Wall Street firm D. E. Shaw, developing a technically sophisticated and successful quantitative hedge fund, becoming the company’s youngest senior vice president in 1992. He then married novelist MacKenzie Scott.

Life’s Work

In 1994, Bezos discovered a website that showed the phenomenal growth of the internet and realized that a unique opportunity was at hand. He envisioned starting the largest store in the world where people could shop online and purchase anything they needed. He wanted his online store to be easy to use and have a focus on excellent selection and customer service. Bezos decided to start this online store with books because traditional bookstores offered only a small sampling of the available in-print titles. His idea was to purchase books on-demand from wholesalers’ warehouses as customers placed orders. This would allow him to start with no real estate, little capital, and no inventory. In the summer of 1994, Amazon.com was founded, and the company sold its first book the following summer.

Initially, Bezos filled all the orders himself, but business quickly expanded. By the end of 1996, there were more than one hundred Amazon staff members. Bezos periodically updated the site and increased its user-friendliness. One of his early innovations was to allow customers to sign up for email alerts for new titles of interest. He chose the name Amazon after the world’s largest river because he wanted to convey a sense of the company’s future and endless offerings.

Although Amazon experienced an excellent growth rate, its losses exceeded revenues for nearly eight years. Bezos worked to remedy the situation through innovation, marketing, and good business sense. In 1996, he started the “associates” program, which paid a commission to other websites that linked to Amazon.com. In 1997, Amazon went public, selling its common shares to investors in the stock market. Bezos used the funds the company earned to enhance the site’s distribution functions. He increased the company’s name recognition by forging relationships with high-traffic sites such as Yahoo! and America Online and investing in banner ads. Additionally, he got US vice president Al Gore to spend a day answering customer-service calls. In October 1997, Amazon became the first internet retailer to have one million customers. Bezos also began to focus on international sales, acquiring several European online bookstores and branding them as Amazon sites. These efforts paid off by 2003, when the company posted its first end-of-year profit.

Amazon remained a robust and relevant online retailer despite increased competition. Bezos accomplished this by focusing on his core mission of providing customers with great selection, an easy-to-use site, and discount pricing. In 1998, Bezos expanded Amazon’s offerings to include music CDs. By 1999, he announced that “Amazon.com will be a place where you can find anything” and began selling everything from clothing and computers to toys and tools. In 2001, Bezos completed negotiations with Borders Books to take over its online book-selling operation, thereby turning a competitor into a partner.

Bezos then turned his attention toward making Amazon more relevant and customer-focused. The company introduced free shipping on all orders of $25 or more, “1-Click” shopping, wedding and baby registries, forums that allowed users to post product reviews, online auctions, wish lists, and a system that tracks a user’s previous purchases and recommends similar items. In 2003, Amazon introduced the controversial “Search Inside” option, a monumental project that allowed customers to keyword search from millions of pages of text. Some publishers were concerned that this feature would inhibit sales of certain types of books, but Bezos remained undeterred and chose to focus on long-term goals rather than short-term gain. He believed that what was most important in the competitive world of electronic retailing was building customer loyalty by giving customers the tools they needed to make informed purchasing decisions combined with excellent customer service and fair pricing. This strategy has paid off for Amazon, as the company has had a higher rate of return customers than have most of its online competitors. In 2005, Amazon introduced Amazon Prime, an annual membership that offers free two-day shipping within the contiguous United States, further cementing customer loyalty. The following year, the company launched video on demand, called Amazon Unbox, which was renamed Amazon Prime Video.

Bezos explored other interests during this period as well. In 2000, he started Blue Origin, a company that develops vehicles and technologies with the intention of enabling humans to travel to space. His friends have said that space exploration has always been his number one interest. In 2015, the company successfully launched its New Shepard rocket to an altitude of over 300,000 feet, landing safely and capable of being reused, marking a significant advance in the reusable rocket market. In early 2016, the New Shepard rocket was successfully reused and was flown to a slightly higher altitude. A third use of New Shepard occurred in April 2016, reaching a slightly higher altitude than the January launch and again returning safely. Test flights continued into 2019, with modifications made as needed.

In 2013, Bezos appeared on the television program 60 Minutes, during which he unveiled Amazon's plan to introduce a drone delivery system that would provide for ultra-fast delivery of items ordered on the website. Also in 2013, Bezos bought the Washington Post newspaper, which, by December 2016, had experienced a 75 percent increase in subscriptions and a doubling of its digital revenue since the sale.

In June 2015, Amazon introduced Echo, a "smart" speaker equipped with software that utilizes a voice-controlled intelligent personal assistant (IPA) named Alexa. The Echo speaker allows users to perform tasks such as play music, make to-do lists, provide real-time weather and traffic reports, or play audiobooks. By January 2017, it was announced that Alexa would be incorporated into a wide range of other smart products such as Whirlpool washers and dryers and Ford Motor Company vehicles.

In 2015, Forbes magazine estimated Bezos's net worth at $44.9 billion, making him one of the wealthiest people in the world. He made Forbes headlines again when, in July 2016, his net worth climbed to $65 billion, making him the third-richest person in the world and unseating Warren Buffett for the first time. On Forbes's official 2017 ranking of the world's billionaires, published in March 2017, Bezos was listed as the third richest, behind Buffet and Bill Gates and above Spain's Amancio Ortega. By the end of the month, he had pulled ahead of Buffet and claimed the number-two spot for the first time. After two weeks, Ortega overtook Bezos, but in June 2017, after Amazon announced it would acquire the Whole Foods grocery chain, Bezos's net worth increased by $2.5 billion in just two hours, making him once again the second-richest person in the world. In March 2018, Forbes officially listed him atop its 2018 billionaires ranking with $112 billion.

The future status of Bezos's wealth was brought into question when he and MacKenzie Scott announced in January 2019 that they would be getting a divorce after having spent time apart. Shortly after, he became involved in a media scandal when the National Enquirer published a story of his affair with Lauren Sánchez that included personal text messages. In early April, the former couple announced that they had reached a divorce settlement in which Bezos would retain 75 percent of their Amazon stock. Despite settling with Scott for about 19.7 million shares of Amazon, Bezos retained his status as the world's wealthiest person into 2020.

The coronavirus (COVID-19) pandemic that hit the US in March 2020 only added to his success, with even more people shopping online during lockdowns. During 2020, Bezos's wealth grew by about $24 billion. On July 5, 2021, Bezos stepped down as CEO of Amazon and became the corporation's executive chairman. Bezos has said in interviews that he chose the date because it was the twenty-seventh anniversary of Amazon's incorporation. He was succeeded as CEO by Andy Jassy.

On July 20, 2021, Bezos was a passenger on Blue Origin's New Shepard rocket, thus becoming the second billionaire, after Richard Branson on July 11, to ride his own company's spacecraft into space. The automated, unpiloted New Shepard rocket took Bezos, his brother, Mark Bezos, an eighteen-year-old Oliver Daemen from the Netherlands, and eighty-two-year-old Wally Funk, from Dallas—representing the youngest and oldest passengers to fly into space—on a ten-minute-and-ten-second flight that flew sixty-six miles into space. Bezos chose the launch date to mark the fifty-second anniversary of the Apollo moon landing. Bezos and Branson's space flights marked milestones for private space tourism but also drew criticism for catering to the wealthy and neglecting global poverty and hunger, especially during a worldwide pandemic.

In December 2021, twenty-three members of Congress wrote a letter to Bezos and Jassy regarding the fatal collapse of an Amazon warehouse in Edwardsville, Illinois, after it was struck by a tornado on December 10. Six Amazon workers died in the collapse, and Bezos was harshly criticized for failing to publicly respond to the tragedy sooner. The lawmakers questioned whether unsafe working conditions had contributed to their deaths. In particular, the signatories of the letter called out workplace safety failures at the warehouse, writing that "they fit all too well with an ongoing, company-wide pattern of worker mistreatment."

In 2022, Bezos once again sat near the top of the Forbes billionaire rankings, in the number-two position. In November of that year, he committed to giving away a large majority of his wealth to charities, including those that fight climate change and homelessness. He had been criticized for donating less than $3 billion during his lifetime to philanthropic efforts. By 2024, he had also drawn criticism as owner of The Washington Post as the storied newspaper experienced leadership struggles and uncertainties.

Significance

Bezos has established himself globally as an innovator who harnessed the power of the internet for retail sales. Amazon changed how people shop and has led to major changes in the retail world, causing brick-and-mortar retail giants such as Barnes & Noble to rethink how they market products and forcing the Borders Group to go out of business in 2011. Many of Bezos’s innovations have become standard practice in the world of e-commerce, including email alert services, heavy advertising on popular websites, banner ads, e-cards, expedited shipping, and referring customers to products that match their buying patterns.

Bezos demonstrated the incredible possibilities of an internet start-up company, launching his business without employees, real estate, or inventory, and then growing it into one of the most widely used and recognized websites in the world. Furthermore, he has shown that even in the competitive world of e-commerce, a loyal customer base can be built through convenience and a focus on customer service and competitive pricing.

Bibliography

Bezos, Jeff. “10 Questions for Jeff Bezos.” Interview by Jeffrey Ressner. Time, 1 Aug. 2005, p. 6. Academic Search Complete, search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=17714200&site=ehost-live. Accessed 11 July 2017.

Brandt, Richard L. One Click: Jeff Bezos and the Rise of Amazon.com. Portfolio / Penguin, 2011.

Darcy, Oliver. "Pulitzer Prize–Winning Washington Post Journalists Call for Leadership Change amid Publisher Scrutiny." CNN, 20 June 2024, www.cnn.com/2024/06/20/media/washington-post-will-lewis-leadership-change/index.html. Accessed 11 Sept. 2024.

Dunn, Marcia. "Jeff Bezos Blasts into Space on Own Rocket: 'Best Day Ever!'" AP News, 21 July 2021, apnews.com/article/jeff-bezos-space-e0afeaa813ff0bdf23c37fe16fd34265. Accessed 5 Aug. 2021.

Garty, Judy. Jeff Bezos: Business Genius of Amazon.com. Enslow Publishers, 2003.

Hamilton, Isobel Asher. "Lawmakers Demand Answers from Jeff Bezos and Andy Jassy over the Deaths of Six Amazon Workers in Warehouse Collapse." Insider, 21 Dec. 2021, www.businessinsider.com/amazon-tornado-deaths-lawmakers-demand-answers-jeff-bezos-andy-jassy-2021-12. Accessed 23 Dec. 2021.

Kirsch, Noah. "As Amazon's 'Alexa' Shines at CES, Jeff Bezos Gets $1.3 Billion Richer in a Day." Forbes, 7 Jan. 2017, www.forbes.com/sites/noahkirsch/2017/01/07/jeff-bezos-net-worth-amazon-echo-consumer-electronics-show/. Accessed 20 Jan. 2017.

Kirsch, Noah. "Jeff Bezos Regains Spot as World's Second-Richest Person Following Whole Foods Announcement." Forbes, 16 June 2017, www.forbes.com/sites/noahkirsch/2017/06/16/jeff-bezos-worlds-second-richest-person-following-whole-foods-deal/. Accessed 11 July 2017.

Levy, Nat. "The Jeff Bezos Effect? Washington Post Is Profitable and Set to Hire Dozens of Journalists in 2017." GeekWire, 27 Dec. 2016, www.geekwire.com/2016/jeff-bezos-effect-washington-post-profitable-set-hire-dozens-journalists-2017/. Accessed 20 Jan. 2017.

Love, Julia. "At CES, Alexa Proliferates: Is This Jeff Bezos' Fourth Pillar?" The Christian Science Monitor, 7 Jan. 2017, www.csmonitor.com/Technology/2017/0107/At-CES-Alexa-proliferates-Is-this-Jeff-Bezos-fourth-pillar. Accessed 20 Jan. 2017.

Melas, Chloe. "Jeff Bezos Announces 40 Grants Totaling $123 Million to Combat Homelessness." CNN, 22 Nov. 2022, www.cnn.com/2022/11/22/business/jeff-bezos-day-1-fund-grants/index.html. Accessed 22 Dec. 2022.

Nocera, Joe. "Jeff Bezos and the Amazon Way." The New York Times, 21 Aug. 2015, www.nytimes.com/2015/08/22/opinion/joe-nocera-jeff-bezos-and-the-amazon-way.html. Accessed 11 July 2017.

Quittner, Joshua. “An Eye on the Future.” Time, 27 Dec. 1999, pp. 56+. Academic Search Complete, search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=2597971&site=ehost-live. Accessed 11 July 2017.

Spector, Robert. Amazon.com: Get Big Fast. HarperBusiness, 2002.

Stone, Brad. The Everything Store: Jeff Bezos and the Age of Amazon. Little, Brown, 2013.

Vinton, Kate. "Jeff Bezos Ends Week $3 Billion Richer, Second Richest on Planet." Forbes, 31 Mar. 2017, www.forbes.com/sites/katevinton/2017/03/31/jeff-bezos-ends-week-3-billion-richer-second-richest-on-planet/. Accessed 11 July 2017.

Vogelstein, Fred. “Mighty Amazon.” Fortune, 26 May 2003, pp. 60–69. Business Source Complete, search.ebscohost.com/login.aspx?direct=true&db=bth&AN=9763501&site=ehost-live. Accessed 11 July 2017.