David Rosenthal: belief

Transcript context

…At this point, Amazon is well underway from transforming a culture of misfits and geeks who want to be able to ship rare books online to MBA city. This is where they're getting experienced executives. They're really turning on the recruiting engine from top business schools and Walmart. There are two different ways to look at Amazon. I think on this show, we focus a lot on the business side of it, where there's an unbelievable cash flow dynamic that we'll talk about, there's the whole get the investors you asked for, there's the constant reinvesting in growth. But up to this point, when you listen to these interviews with Shel Kaphan, or reading all the stories on Greg Linden's blog who was an early engineer, or all the interviews Glenn Fleishman has given, it really is about adapting technologies that were not really ready yet being the first and biggest and being with misfits on the Internet. There was a big exiting of the 1994–1997 crowd in 1998 and 1999 as Dalzel, his people, and all the MBAs come in to say, okay, it's working and it's not just about this quest for odd books. Yup. I actually would put Dalzel on the Walmart crew. I think there are three key categories of people that were necessary for Amazon to succeed. There were the technologists—Shel in the early days and the freaks and geeks—but then that evolved into a world class technology organization over time. There were the MBAs that we're going to talk about in a minute. The Andy Jassys, the Jason Kilars, the Harrison Millers, the Jeff Blackburns. And then there were the Walmart people, the Rick Dalzel. Jeff, he didn't come from Walmart, but he's very much cut from that cloth, the back-end retail logistics distribution people. And you really need a world class, all three of those to make this work. On the distribution and supply chain front, more than a dozen Walmart executives come over to Amazon. In late 1998, Walmart sues Amazon for trying to steal trade secrets. The case settles with no damages, but there was damage. It happened. That DNA came right out of Walmart and right into Amazon. To be fair, like we said, it's a different thing than the Walmart supply chain that they're building. It's the Amazon supply chain. Which they didn't realize enough of that first. There were all sorts of false starts in Amazon getting good at distribution because even though they knew better, they were copying the Walmart playbook. They were doing the classic Amazon thing. They were bruteforcing their way through the maze, learning from mistakes, backing up, turning left, and going the other direction, but they needed to go bump into that wall to do it.…

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