For someone who’s spent the last 20 years to building his business empire, Jeff Bezos seems remarkably comfortable about its mortality.
“Amazon is not too big to fail,” Bezos said during an Amazon town hall meeting, replying to an employee who asked about Amazon’s future in the light of bankruptcies of retailers like Sears. “In fact, I predict one day Amazon will fail,” he went on. “Amazon will go bankrupt. If you look at large companies, their lifespans tend to be 30-plus years, not a hundred-plus years.”
Bezos is technically right — the list of the most valuable companies today is very different from what it was just over three decades ago. Several companies once thought invincible, including Xerox, GE, and most recently, Nokia, have fallen by the wayside, or are a shadow of their former selves.
But even if history isn’t on his side, Bezos’s statements are a startling admission for someone responsible for $1 trillion of shareholder wealth. However, Bezos seemed to hint that the acceptance that Amazon’s limited shelf life might just end up prolonging it. “If we start to focus on ourselves, instead of focusing on our customers, that will be the beginning of the end,” he said. “We have to try and delay that day for as long as possible.”
Bezos has been consistent with his messaging to Amazon employees over the years, constantly urging them to guard against complacency. In 1997, right after Amazon’s IPO, Bezos had told interviewers that it was just Day 1 at the company, and there was still loads to be done. He repeated the same line at a townhall last year, saying that it was still Day 1 at Amazon, and they should Guard against a “Day 2”. “Day 2 is stasis, followed by irrelevance, followed by excruciating decline, followed by death,” he’d said. “That is why, it is always Day 1,” he’d declared amidst cheers from Amazon employees.
Amazon seems to be staying true to his word thus far — it’s expanding like a startup, rapidly moving into new areas like the cloud, smart home appliances, and even self-checkout stores that require no cashiers. But challenges are looming on the horizon — Amazon’s size and scale have attracted the attention of regulators. It’s also in the crosshairs of US President Donald Trump, who’s often accused it for not adequately compensating the US Postal Service for using its services. And Bezos’ personal investments have also raised some eyebrows — after Bezos bought the Washington Post last year, it’s felt that Amazon’s sphere of influence is becoming too large for its own good.
Bezos, though, seems to insist that what will prolong Amazon’s lifespan is it realizing that its time at the top of the e-commerce pile is limited, and being on its guard. It’s a sentiment that’s been used before in Silicon Valley — in 2005, Steve Jobs had urged people to stay hungry stay foolish. Bezos is using a somewhat darker analogy of failure and bankruptcy, but he’s saying much of the same.