and the the first thing to really talk
about is to I want to take you back to
to the beginning and in 1995 you started
young you went public in 97 and I’ll
adjust for stock splits but you you
raised stock you rate you issued shares
at a dollar fifty a share that’s right
in 1988 your revenue was six hundred
million dollars and you lost 125 million
but you’re stocking on to fifty five
dollars a share so you doubled down
sales went up threefold you lost another
four hundred million but your stock went
up to seventy six dollars twenty seven
billion dollars of market cap your
personal net worth of nine billion take
us back to that time where the market is
telling you you’re doing great but you
have red ink in the company you took on
two billion dollars of debt from 99201
while you tripled while you doubled
sales yet again what were you thinking
back then well that’s a great great
question
and it is kind of fun to go back and
think about those days you know in those
days when we had I don’t know when I
started the company and it was just one
person and then there were ten people
and today there are almost 600,000
people so there’s a lot of change but
back in that time we were still pretty
small company by most standards but we
were were growing fast and it was very
exciting you know I had when I started I
was driving all the packages through the
post office myself I knew the UPS guy so
well that he would let me in even like
five minutes after closing so it was you
I hoped one day we’d be able to afford a
forklift it was that kind of operation
we were so inefficient with our
operations and logistics in those early
days when there were just ten of us that
I didn’t have packing tables we were
packing on the floor
our hands and knees and I said to one of
the software engineers who was packing
alongside me you know we should do we
should get knee pads and he looked at me
like I was the dumbest guy he’d ever
seen in his life
and he said Jeff we should get packing
tables and we next day I got packing
tables and it doubled our productivity
and so but by then the error you’re
talking about we had we’ve gone public
and you’re riding on a split adjusted
basis it’s a dollar fifty a share in
today’s terms and the market became very
quickly a kind of an internet bubble
kind of market and the stock prices went
up very very high when I raise the
initial funding for Amazon I had to talk
to 60 prospective investors to raise a
million dollars and I raised a million
dollars from 22 different investors
$50,000 at a time and they got 20% of
the company for a million dollars and
that was in 95 but just three years two
or three years later you know Stanford
MBA with no business experience could
raise 25 million dollars with a single
phone call if they had a internet
business plan so the whole thing is just
two or three years the excitement really
as we could would shortly see when the
bubble burst in the year 2000 the
hyperbolic excitement about the internet
had infected everybody and I was I knew
that there was that we had a fun though
I liked our business and I liked the
fundamentals of our business but I also
knew that the stock price was
disconnected from what we were doing on
a day to day basis and so I was always
preaching we would have All Hands
meetings and there was a small number of
employees at that time but you know
probably let’s see in 97
we would have had a few hundred
employees we would have All Hands
meetings and I would said look you know
we got to remember the great quote from
Benjamin Graham that in the short run
the stock market is a voting machine in
the long run it’s a weighing machine so
don’t think about the daily stock prices
going up
every day whose stock price is going up
and I didn’t want because all the
employees had stock options and I didn’t
want them counting their success that
way and so I was to look when the stock
is up 30% in a month but don’t feel 30%
smarter because when it’s down 30% in a
month then you’re gonna have to feel 30%
dumber and it’s not gonna feel as good
and it was good that I kind of laid that
groundwork because you know sure enough
in the year 2000 the whole thing came
tumbling down I think Amazon went about
$6 what John’s a $6 and that I don’t
even know if that’s on a split adjusted
basis I think that’s probably that was
below I was on a split adjusted basis
probably below $1 so and you know ever
doubt the business model at that point
no so I you know it’s very interesting
to me because I had all the internal
metrics on you know how many customers
we had what was going on I could see
people thought we were losing money
because we were selling dollar bills for
90 cents you know we were very clear
that we were not we were we had high
fixed costs and but we had contribution
margin positive contribution margin and
I just knew that it was a fixed cost
business and as soon as we reached the
sufficient scale we would have a very
good business and so that was that
understanding of the fixed nature of our
expenses relative to physical world
retail is what led us to have the get
big fast strategy we knew that it would
be that our economics would be very much
improved if we can have a sufficient
scale so if we worked hard so so at that
time you’re you’re preaching the
benefits of e-commerce and and really
yeah disintermediating the business so
fast-forward to today now we have
content we have physical Amazon stores
we have Amazon cashier lists stores yeah
we used to call shoplifting
and and then now you shoplifting without
the jail time that’s right and then and
then and then buying whole foods here
for a Texas company so how does that how
does that fit together your vision and
then how do you manage these disparate
businesses with different cost
structures now yeah well maybe finishing
up a little Oh in that prior point
before I answer that question I and and
also with either the memory of Barbara
Bush in all of our minds I I think part
of if you’re a lot of people in this
room are entrepreneurs start their own
businesses done various things taking
risks of various kinds and I think the
one of the precursors one of the
foundational things to being able to
take risk is to have had some kind of
support from somebody you have to have
some mentors you have to have somebody
who loves you these are the kind of
things that build up and allow you to
kind of you know jump off into uncharted
terrain and do something new because you
know you have a support system of one
kind or another and and I’d certainly
did so I for me I just want to point out
that I feel very strongly that there’s a
well I’ve won a lot of lotteries Amazon
is one of the lotteries that I won but I
had a big lottery with my parents my dad
is a Cuban immigrant he came here when
he was 16 years old and speaking English
my great guy and my mother had her had
me when she was 17 years old so she was
a pregnant 16 year old in Albuquerque
New Mexico in high school which was not
cool and she made it work and heard her
parents my grandparents helped her with
that whole thing and made that all work
if you don’t get that kind of support
somehow it doesn’t have to be your
parents sometimes people get lucky it’s
the grandparent or it’s a friend or a
family friend or a teacher it can be
somebody but you need that somebody has
to step into your life and that’s a
lottery that I suspect a lot of people
in this room have also one just like me
so the question go Amazon goes and all
that we do so many different
things so this is a question I says get
how can you do so many different things
why don’t you stick to the Knitting the
kind of traditional advice would be to
stay focused and keep the business
simple and the way I think about this is
we actually do stick to one thing it’s
just not described it’s not the
businesses so we do web services which
is you know big enterprise is buying
compute services from us and we have our
retail business and we have Amazon
Studios which is making original content
Amazon go the things you listed so but
the cultural thread that runs through
all these things is the same we only
have a few principles of the Amazon kind
of core values that we go back to over
and over again and if you looked at each
of the things that we do you would see
those run straight through everything so
the first one and by far the most
important one is customer obsession and
we talk about it as customer obsession
as opposed to competitor obsession and I
have seen over and over again companies
talk about that their customer focused
but really when I pay close attention to
them I believe they are competitor
focused and it’s just a completely
different mentality by the way
competitor focus can work but I don’t
think it works in the long run as well
as customer focus for one thing once
you’re the leader if your whole culture
is competitor obsessed it’s kind of hard
to stay energized and motivated if
you’re out in front whereas customers
are always unsatisfied they’re always
discontent they always want more and so
no matter how far you get out there in
front of your competitors you’re still
behind your customers so they’re always
pulling you along so customer obsession
is a deep principle that underlies
everything we do another one is
eagerness to invent so we love to
pioneer and when we have done by the way
whenever we have tried to do something
in
me too fashion we have failed at it we
need to have something that is
differentiated unique something that
customers are going to like that we’re
kind of leading with so that’s another
element that works for us and then
another one is long-term thinking we are
willing to to take some time and be
patient with our business initiatives
and that runs through everything so a
lot of our competitors might have two to
three year kind of timeframe so we might
have more of a 5 to 7 year sort of
timeframe and then the last one
operational excellence so literally you
know how do you have high standards
around you know identifying defects
fixing defects at the root all those
kinds of things that lead to what I
think also can be in a simpler way just
eat it as professionalism that you want
to do things right just for the rich
sake of doing them right so let’s talk
about that with a with another I guess
this is a corollary now that you have
about 600,000 employees I calculated
you’re adding about 250 people a day
you’ve mentioned that you’re trying to
fend off day – yeah and you said that
day – is stasis followed by irrelevance
followed by excruciating ly painful
decline followed by death yeah that’s
why it is always day one yeah yeah how’s
that work well so day one and this is a
phrase that we use at Amazon all the
time I’ve been using it’s in my first
annual shareholder letter from 20 years
ago and we stay it’s always day one and
it needs to be day one for the reason
that you just mentioned and how do you
it so the real question for me is how do
you go about maintaining a day one
culture you know it’s great to have the
scale of Amazon we have financial
resources we have lots of brilliant
people we can accomplish great things we
have global scopes we have operations
all over the world but the downside of
that is that you can lose your
nimbleness you
lose your entrepreneurial spirit you can
lose your that kind of heart that that
small companies often have and so if you
could have the best of both worlds if
you can have that entrepreneurial spirit
and heart while at the same time having
all the advantages that come with scale
and scope I think think of the things
that you could do and and so how the
question is how do you achieve that the
scale is good because it makes you
robust you know a big box or can take a
punch to the head the question is you
also want to dodge those punches so
you’d like to be nimble you want to be
big and nimble and I find there are a
lot of things that are protective of the
day one mentality I already spent some
time on one of them which is customer
obsession I think that’s the most
important thing if you can it gets
harder as you get bigger when you’re a
little tiny company figure 10 person
startup company every single person the
company is focused on the customer when
you get to be a bigger company you’ve
got all the middle if you’ve got middle
managers and you’ve got all these layers
and the those people are on the front
lines they’re not interacting with
customers every day they’re insulated
from customers and they start to manage
not the customer happiness directly but
they start to manage through proxies
like metrics and processes and some of
those things can become bureaucratic so
it’s very challenging
but one of the things that happens is
the decision-making velocity slows down
and I think the reason one of the
reasons that that happens is that people
all say junior executives inside the big
company start to model all decisions as
if they are heavyweight irreversible
highly consequential decisions and so
even two-way doors you could make you
make a decision it’s the wrong decision
you can just back up back through the
door and try again
even those reversible decisions start to
be made with heavyweight processes and
so you can teach people that these
pitfalls and
and traps and then teach them to avoid
those traps and that’s what we’re trying
to do at Amazon so that we can maintain
our inventiveness and our hearts and our
kind of small companies spirit even as
we have the scale and scope of a larger
company so six hundred thousand people
small company which that’s a that’s a
trick so I know the bush Center we focus
on leadership and I know that you’re
also a voracious reader and you’re fond
of a book by now seem to leave called
the Black Swan yes sure and it’s it’s
about humans tendencies to reduce thing
to anecdote reduce things to anecdotal
stories and to shield us from sort of
the randomness of the way things
actually have to building narratives and
and how can we human will to create a
narrative around anything to connect any
sequence of facts we can create a
narrative so how do you infect that
throughout the whole organization when
you have that many that many layers well
I think what I would say about that it’s
really a little different from the way
that that Black Swan talks about
anecdotes the way you’re talking about
but I’m actually a big fan of anecdotes
in business not building a narrative
structure around them necessarily but I
still have an email address that
customers can write to I see most of
those emails and I don’t answer very
many of them anymore but but I see them
and I and I forward them some of them
the ones that catch my curiosity afford
them to the executives in charge that
area but with a question mark and that
question mark is just a shorthand for
can you look into this why is this
happening what does what’s going on and
what I find is because we have tons of
metrics we have you know weekly business
reviews with these metric decks and we
look at our we know so many things about
customers and there
there you know whether we’re delivering
on time what you know whether the
packages have too much air in them and
you know wasteful of packaging and so we
have so many metrics that we monitor and
the thing I have noticed is that when
the anecdotes and the data disagree the
anecdotes are usually right there’s
something wrong with the way you’re
measuring it and that’s why it’s so
important to to keep your you need to
run it something that you were you’re
doing you know shipping billions of
packages a year for sure you need good
data and metrics and are you delivery on
time you deliver on time in every city
are you delivering on time to apartment
complexes are you delivering on time in
certain countries you do need the data
but then you need to check that data
with your intuition and your instincts
and you need to teach that to the all
the senior executives and and junior
executives so if you’re not answering
your emails can you give us your cell
phone maybe a text is the still have the
to pizza rule and no powerpoints oh yeah
create teams that are no larger than can
be fed with two pizzas we call that the
two pizza team rule no powerpoints are
used inside of Amazon so every meeting
we have that we hire a new executive
from the outside
this is the weirdest meeting culture you
will ever encounter and new executives
have a little bit of you know culture
shock in their first Amazon meeting
because what we do is somebody for the
meeting has prepared a six page memo a
narrative Lee structured memo that is
got you know real sentences and topic
sentences and verbs and nouns not just
bullet points and it lays out been
supposed to create the context for what
will then be a good discussion so and
then we read those memos silently in the
meeting so it’s like a study hall and we
do that everybody sits around the table
and we read silently from usually about
half an hour however long it takes us to
read the document and then we discuss it
and it’s so much better than the typical
PowerPoint presentation for so many
reasons I could talk about this for
although nobody know nobody’s eating the
pizza at that point because we’re
sitting right no pizza usually at that
point yeah you know one author said that
that takes you back to River Oaks
Elementary School in Houston where you
started where they started with a
reading with a silo reading exercise I
never made that connection but I you
know you never know where things come
from I did have a great experience there
so but I definitely recommend a memo
over the PowerPoint and the reason we
read them in the room by the way is
because just like you know high school
kids executives will Bluff their way
through the meeting as if they’ve read
the memo because we’re busy and so you
got to actually carve out the time for
the memo to get read and that’s what the
first half hour of the meeting is for
and then everybody’s actually read the
memo they’re not just pretending to have
read that’s pretty effective
how has your how has your leadership
style change
over the years it’s changed a lot mostly
just because it’s had to you know the
company has changed so much and I can’t
you know the company is ten people or a
hundred people I can be involved in
every decision not just you know not
just the objectives like what are we
gonna do but even the methods how are we
going to do it on a wedge the company
gets bigger as you know the CEO or the
founder whoever it is leading the
company cannot be involved in all of
those decisions they certainly cannot be
involved in the methods of how things
were going to get done so you do have to
change your leadership approach as the
company scales but the the but the
principles of the company have not
changed in fact I probably spend more of
my time now on culture and studying
trying to set high standards for things
the big customer obsession and
inventiveness and things like that so
for me I’m I’m kind of a teacher now so
it’s changed quite a bit and I have this
great luxury I love my job I tap dance
into work even I get back I just got
back from an amazing vacation in Norway
I got to go dogsledding and go to a wolf
preserve and all this really cool stuff
but I couldn’t wait to get back to work
because it’s so fun and the reason
weather is this fun for me is I get to
work in the future so my job I have very
limited kind of day-to-day operational
needs that you know and I’ve constructed
my job so that I don’t have to be pulled
into the present I can state 2 or 3
years in the future and actually I’m I’m
always advising my senior team the
people who report to me that they should
organize themselves in the same way
we’re big enough now that they need to
be able to look around corners
they can’t be if something pulls me into
the president it’s because something has
gone wrong
you know and we need to you know kind of
figure – it’s a firefighting exercise
and that’s not how you should be running
a business of this skill so yeah it’s
changed a lot
okay so following up with that you were
quoted as saying I believe you have to
be willing to be misunderstood overall
we innovate so how are you misunderstood
they’re gonna do is on if you’re gonna
do anything new or innovative you have
to be willing to be misunderstood and if
you can’t tolerate that and for God’s
sake don’t do anything new or innovative
every important thing we’ve done has
been misunderstood often by well-meaning
sincere critics sometimes of course by
self-interested insincere critics but
but you know I’ll give you an example a
thousand years ago we started this thing
called customer reviews and we let
customers review books we only sold
books at that time and customers could
come in and rate a book between one and
five stars and they could write a
text-based review you guys are very
familiar with this it’s now a very
normal thing but back then this was
crazy and the the publishers the book
publishers did not like this because of
course not all the reviews are positive
and the I got a letter from one
publisher that said I have a good idea
for you why don’t you just publish the
positive customer reviews
and I thought about this and because and
his argument is making to me is that our
sales would go up if we just published
the positive customer reviews and I
thought about this I thought I don’t I
don’t actually believe that because I
don’t think we make money when we sell
something we make money when we help
someone make a purchase decision and
it’s just a slightly different way of
looking at it because people are that
part of what they’re paying us for is
helping them make a purchase decision
and if you think about it that way then
you want the negative reviews to and of
course it has been extremely helpful for
people to have negative customer views
and by the way it’s come full circle now
where the product manufacturers use the
customer reviews to improve the next
generation of the product so it’s
actually helping the whole ecosystem but
then now nobody criticizes customer
reviews in fact if you were in the you
know here in the year 2018 if some
ecommerce company were to say we’re only
going to publish the positive customer
reviews that would be the crazy thing
that would get criticized so the new and
innovative quickly becomes the new
normal and then it’s you know it’s it’s
a new incumbent idea and then it doesn’t
get criticized went by the way more
generally and what I preached at Amazon
to all of our employees is when we are
criticized there is a simple process
that you need to go through which is
first you look yourself in the mirror
and decide these are critical right do
you agree
are we doing something wrong if you are
change and by the way if you look
yourself in the mirror and you decide
that your critic as wrong as we did with
the customer reviews then do not change
no matter how much pressure is brought
to bear do the right thing in that case
as well have a deep keel you have
to have a deep teal good so why don’t we
shift to personal away from Amazon a
little bit if if you could write your
legacy what would you want your legacy
to read world’s oldest man as I stole
that that’s not original
but I would love it let’s work on that I
keep telling my biotech friends and
hurry to hello guys come on you know I
don’t know I’m probably if you think
long term and I can talk about this
great length but long term the thing if
you take a really long run view you know
many decades maybe even a couple hundred
years I think the most important work
that I’m doing and I get increasing
conviction on this with every passing
year is the work I’m doing a Blue Origin
on space travel well I don’t what well
why don’t we talk about that okay
because I think I think from a vision
standpoint I think people should
appreciate the horizon that you have so
yeah let’s talk about your kind of view
I’ll call your near-term objectives we
face seventy-five years yeah and then
your long term objective is one hundred
to three hundred years from there well
so first of all you don’t choose your
passions your passions choose you and
all of us are gifted with certain
passions and the people who are lucky
are the ones who get to follow those
things and yet i OS advise our young
employees or meet with interns this one
you can have and my kids too you’re
gonna have a job or you can have a
career or you can have a calling and if
you can somehow figure out how to have a
calling you have hit the jackpot because
that’s the big deal
and most people don’t ever get there you
know you’re very lucky if you have a
career a lot of people end up with a job
and so you know for me I have been
and Rockets space travel propulsion
since I was a five-year-old boy and I
have spent a tremendous amount of time
thinking about it so it’s not like I
really have a choice to follow this
passion it has captured me but I think
it’s very important that we go out into
space as a civilization and the reason
is not the one that you I think is very
commonly there are many reasons that are
there given one of the reasons that is
out there and it’s a very old idea one
of the people who first articulated it
very well was arthur c clarke he said
all civilizations become spacefaring or
extinct and that even may be technically
true in a long run
kind of long enough verison but that
idea is one of the has kind of come to
me that we need to we’ve got all our
eggs in one basket and we need a plan B
you know if we had a civilization
elsewhere on another planet somewhere in
the solar system then when earth gets
destroyed humanity will still be fine I
find this particular argument incredibly
unmotivated we we have now sent robotic
probes to every planet in this solar
system believe me this is the best one
it is not close my friends who want to
move to Mars I say have an idea for you
why are you first for a year moved to
the top of Mount Everest because the top
of Mount Everest is a garden paradise
compared to Mars and and so it’s say
this planet is a gym this planet is
unbelievable and as you travel around
the more you travel around you the more
you see how incredible it is and I’m not
even just talking about nature I’m
talking about the civilization we build
in the urban cities that we have and all
this these amazing things and so we need
to protect it now and I’m not even talk
about protecting it from asteroids or
nuclear holocaust or anything so
although even all this things are
probably important and valid but we
don’t need to worry about that because
we have something more certain that is a
problem and that is if you take current
baseline energy usage on Earth today
global energy usage and compound that at
just 3% a year that in just a few
hundred years you’re gonna have to cover
the entire surface of the earth and
solar cells that’s how powerful
compounding is so and by the way we have
been growing energy usage at a few
percent a year for a long time so and
and we and we our civilization has a lot
of advantages because we increase our
energy usage the human body if we in a
state of nature if you are just an
animal in the state of nature your body
or metabolic rate uses about a hundred
watts of power but a modern person
living in a developed country you
actually use your your your all in
civilizational per capita metabolic rate
is 11,000 Watts we use a lot of energy
that’s about as much energy as a blue
whale uses and so we have you know there
are billions of us and most of us don’t
even
really living in the kind of lifestyle
of a developed country yet but they will
be very soon and we hope they will be we
want them to and so you’re gonna face a
choice
and you won’t face this choice and I
won’t face this choice but your
grandchildren’s grandchildren will face
this choice do you want to live in a
world of stasis or do you want to have a
trillion humans living in the solar
system because the source system is big
earth is small we capture a tiny Earth’s
surface is sort of small it captures a
tiny tiny fraction of the solar output
so once you got into space you have for
practical purposes once again unlimited
resources and the source system can
easily support in Chilean humans they’ve
got a trillion humans and you’d have a
thousand mozart’s and a thousand
Einsteins and so on and so on that would
be a dynamic incredible civilization in
which you would watch your
grandchildren’s grandchildren to live in
I think ultimately earth becomes zoned
you know residential and light in this
industrial and you know we’ll have
universities here and beautiful parks
and houses and but we won’t have big
factories here all of that will be much
better done in space where we have
access to much higher quality resources
and so that’s going to take several you
know that’s a multi hundred year vision
in my piece of this vision is I’m taking
my amazon lottery winnings and I’m
converting them into reusable rocket
vehicles so that we can lower the cost
of access to space because right now the
price of admission to do the interesting
things in space is just too high if I
look at what Amazon was able to do 20
years ago
didn’t have to build a transportation
network it already existed that heavy
lifting was in place we didn’t have to
build a payment system that heavy
lifting had already been done it was the
credit card system we didn’t have to
build put a computer at every desk that
had already been done – mostly for
playing games by the way and so on so
all the pieces of heavy lifting were
already in place 20 years ago
and that’s why as with a million dollars
I could start this company today you
know and then there are even better
examples on the internet over the last
20 years you know Facebook started in a
dorm room I guarantee you two kids
cannot build a giant space company in
their dorm room it’s impossible but I
want to create the heavy lifting
infrastructure kind of do the hard part
so that a future the future generation –
kids in a dorm room will be able to
create a giant space company so that’s
the goal and then because thank you
you’re not gonna you’re not gonna
achieve the vision that I just laid out
of a trillion humans living in space and
having this dynamic world without a big
industry made up of thousands of
companies but it has to start with
making the vehicles much more productive
right now you use a rock at once and you
throw it away and that is just a very
expensive way to do business
so can I talk to them about another
element with to get you to discuss your
vision this may not be germane to the
work you’re doing but I’m but you are
you are one of the great thinkers
artificial intelligence yeah pros and
cons we’ve heard people talk about the
great benefits we’ve heard about
disrupting and changing and leaving off
us all and you know jobless society
we’ve heard autonomous weapons or a
disaster yeah where do you fall on the
on your vision of we’re in artificial
intelligence is going to go and also
some of the I think some of the more
cautionary I’ll say benefits well and
you mentioned a few things there each of
those is worth visiting because they’re
different
I think autonomous weapons are extremely
scary
I think it’s a big and you do not need
general AI so right now the things that
we know how to do you would you should
think of those things is what is called
narrow AI things like machine vision and
so on to build incredibly scary
autonomous weapons you do not need
general AI the techniques that we
already know and understand are
perfectly adequate and these weapons
some of the ideas that people have these
weapons are in fact very scary and so I
don’t know what the solution that but
smart people need to be thinking about
that doing a lot of R&D is there is
there a kind of you know multi it’d have
to be a big treaty like the Geneva
Convention or something that would help
regulate these weapons because you
they’re actually they have a lot of
issues so that one I think is genuinely
scary the idea that there’s going to be
a general AI Overlord that subjugates us
or kills us all I think is not something
to worry about I think that is overhyped
I I’m first of all we don’t know we’re
nowhere close to knowing how to build a
general AI something that could set its
own objectives we have no idea wouldn’t
even it’s not even hardly it’s not even
a valid research area we’re so we’re so
far back on that one so that’s a I think
that’s a very long-term prospect that it
could even happen but second of all I
think it’s unlikely that such a things
first instincts would be to exterminate
us as it seems that would seem
surprising to me maybe employ is much
more likely it will help us you know
because we know we’re perfectly capable
of hurting ourselves you know maybe we
could use some help so I’m optimistic
about that one and certainly don’t think
we need to worry about it today and then
the jobless you know is are we gonna is
a I going to put everybody out of work I
am not worried about this I find the
people all of us I include myself we are
so unimaginative about what future jobs
are going to look like and what they’re
going to be you know if I took him back
in time a hundred years when everyone
almost everyone was a farmer and I told
you know we’re having we’re at some big
farming convention or something and I
say in the year 2018 there is gonna be a
job occupation called massage therapists
they would not have believed you and in
fact I was telling this story to a
friend they said Jeff forget massage
therapist there are dog psychiatrists
and I went I would probably find one on
Hamlin I wouldn’t look that up on the
internet sure enough you can easily hire
a psychiatrist for your dog and so what
you know there is where we we humans
like to do things and we like to be
productive and we will figure out things
to do and we will use these tools to
make ourselves more powerful and and in
fact what I predict is that jobs will
get more engaging yes because you have
to remember you know a lot of the jobs
today are are quite routine they are not
necessarily anybody’s as I said before
career or calling and so I predict that
because of artificial intelligence and
its ability to automate certain tasks
that in the past were impossible to
automate and not only will we have a
much wealthier civilization but that the
quality of work will go up very
significantly and that a higher fraction
of people will have callings and careers
relative to today so can i yet can I
bring you back down
down to the president a little bit and
then I’d be remiss if I didn’t use some
of our time on your personal purchase of
the Washington but yeah
so you buy the Washington Post a few
years ago is it is it going the way you
thought it would go much better much
faster so the post is profitable today
so I bought the post in 2013 the post
was still a fantastic institution at
that time but it was in great financial
difficulty it’s a fixed cost business as
most of all most all publishing is in
their revenues over about six years from
2007 2008 to 2013 had been cut in half
from a billion dollars a year to half a
billion dollars a year and that in a
fixed cost business puts a tremendous
amount of pressure on the business they
were they needed to reduce the size of
the newsroom layoff reporters and and it
was very difficult and Don Graham whose
family had owned the paper for a long
period of time he contacted me through
an intermediary actually and we’ve known
each other pride for almost 20 years
actually and I was very surprised but he
said that he was interested in selling
the paper and he wanted to I said look
like I’m not the right buyer Don because
I don’t know anything about the
newspaper business and he said we don’t
need and into that we’ve got lots of
people who understand this business we
need somebody who understands the
internet better and this was a great act
of love of Don’s because the paper had
been their family for a long time and he
cared more about the paper than he cared
about his ownership of it and he’s if
any of you know him he’s an incredible
gentleman just a wonderful guy and so
overall several conversations he finally
convinced me that I could help and then
I had to convince myself of a couple of
things one was did I really believe it
was an important institution and
and and that for me was a very quick
gait to get through I I you know I I
felt very powerfully that it was an
important institution I do believe that
democracy dies in darkness I think that
the the paper is resides in Washington
DC capital city of the United States of
America the most powerful country in the
world needs a paper like The Washington
Post and so it was easy to decide it’s
an important institution I would not
have bought and tried to help turn
around a financially upside-down salty
snack food company you know I just have
better things to do so that’s why for me
it was so important that it be I might
buy a really well-run healthy soft food
snack company that would just be an
investment and so I so I that and then
the second gate I had to go through
after that was I really wanted to
convince myself that it wasn’t hopeless
because if it had been hopeless you know
also I wouldn’t want to get involved but
I didn’t think it was and and and it has
turned out to work forever well we did
one very simple thing really which is we
switched from it’s been a lot of work
and I don’t mean to make it sound simple
the team has done an amazing amount of
work and we have a great editor and
Marty Baron and a great publisher and
Fred Ryan and a great technical leader
inside lash I mean we’ve got a killer
team at the post but the big kind of
strategic change at the post was
flipping it from being a fantastic local
regional newspaper to being a fantastic
national global newspaper and the reason
we did that is very simple the internet
took away so many gifts from newspapers
mostly there have local ad monopolies
and so on like the internet just solved
all the gifts that newspapers had but
the one gift that had brought to the
table for newspapers is almost free
global distribution
because you can do it digitally and so
we refocused on that and we have to we
had to switch from making a relatively
large amount of money per reader on a
relatively small number of readers to a
small amount of money per reader on a
much larger number of readers and that’s
what we’ve that’s what we’ve done and so
in our time remaining a couple quick
ones yeah
who do you emulate what kind of role
model yeah Oh a bunch of people you know
I have been a Warren Buffett fan in the
business room have been a Warren Buffett
fan since my early 20s I read the things
he writes I am so he’s a very big fan I
think kind of CEOs today out there that
I like again in the business realm Jamie
Dimon I think if there are couple CEOs
that I think if I were a big shareholder
in JPMorgan Chase I would just show up
every Monday morning with like pastries
and coffee for Jamie and I would be like
so you happy you good because I think
he’s a terrific executive and in a very
complicated company same thing Bob Iger
at Disney I think is a superb executive
some probably bring him pastries
so there are a lot of male models
healthy pastries well yeah I guess I
hadn’t thought about that you know
that’s right yeah but and then outside
of that you know I’ve had lots of role
models throughout my life yeah some of
my teachers at River Oaks Elementary
School that you mentioned I had you know
I had my parents so I talked about a
little earlier didn’t talk too much so
my grandfather but he was a gigantic
influence in my life I had the great
good fortune because my mom was so young
my grandparents would take me every
summer starting at age 4
every summer kind of to give her a break
really for the whole summer
so I’d be with my grandparents and on
their ranch in Cotulla Texas which is
halfway between San Antonio and Laredo
we lived in Houston and so we would make
the 5-hour drive out to Cotulla they
dropped me off it’s been a couple of
days there that they go back to Houston
I’d spend the summer and I went every
day as a ranch with my grandfather to
help know a four-year-old boy on a ranch
in South Texas it’s not a lot of help
but I didn’t know that I thought I was
helping and and then it’s like by the
time I was 16 I actually was helping so
I have you know I I can I can suture up
a prolapsed cow I can fix windmills
my grandfather was so resourceful and
that he made his own veterinary needles
he would take a little piece of wire and
pound it flat with a was like a oxy
acetylene torch and then drill a little
hole through it and then we would do we
did all of our own veterinary work some
so we had but we had great fun out there
you know we built barns and welded
things and he bought a d6 Caterpillar
bulldozer used to like 1955 model year
for $5,000 it was completely broken the
gears were stripped and then we spent
you know a whole summer repairing that
and the first thing we had to do to
repair it was build a crane to take the
gears out of the transmission and so you
know what I learned from watching him
was just how resourceful he was he
didn’t ever call a repairman he figured
it out and I do think that that’s one of
the things that you know super lucky for
me to grow up in that environment where
you got to see resourcefulness in action
so my grandfather giant role model for
but Jeff you are you’re an American icon
and these stories really reflect how
grounded you are and starting a company
from the time where you were doing it
yourself to where you are today and to
maintain that touch that you have at the
same time that you have this vision is
really what leadership is all about the
bush center we focus on developing and
recognizing leadership and that’s what
we’re doing this week our time is up and I do want to thank you I also
about is to I want to take you back to
to the beginning and in 1995 you started
young you went public in 97 and I’ll
adjust for stock splits but you you
raised stock you rate you issued shares
at a dollar fifty a share that’s right
in 1988 your revenue was six hundred
million dollars and you lost 125 million
but you’re stocking on to fifty five
dollars a share so you doubled down
sales went up threefold you lost another
four hundred million but your stock went
up to seventy six dollars twenty seven
billion dollars of market cap your
personal net worth of nine billion take
us back to that time where the market is
telling you you’re doing great but you
have red ink in the company you took on
two billion dollars of debt from 99201
while you tripled while you doubled
sales yet again what were you thinking
back then well that’s a great great
question
and it is kind of fun to go back and
think about those days you know in those
days when we had I don’t know when I
started the company and it was just one
person and then there were ten people
and today there are almost 600,000
people so there’s a lot of change but
back in that time we were still pretty
small company by most standards but we
were were growing fast and it was very
exciting you know I had when I started I
was driving all the packages through the
post office myself I knew the UPS guy so
well that he would let me in even like
five minutes after closing so it was you
I hoped one day we’d be able to afford a
forklift it was that kind of operation
we were so inefficient with our
operations and logistics in those early
days when there were just ten of us that
I didn’t have packing tables we were
packing on the floor
our hands and knees and I said to one of
the software engineers who was packing
alongside me you know we should do we
should get knee pads and he looked at me
like I was the dumbest guy he’d ever
seen in his life
and he said Jeff we should get packing
tables and we next day I got packing
tables and it doubled our productivity
and so but by then the error you’re
talking about we had we’ve gone public
and you’re riding on a split adjusted
basis it’s a dollar fifty a share in
today’s terms and the market became very
quickly a kind of an internet bubble
kind of market and the stock prices went
up very very high when I raise the
initial funding for Amazon I had to talk
to 60 prospective investors to raise a
million dollars and I raised a million
dollars from 22 different investors
$50,000 at a time and they got 20% of
the company for a million dollars and
that was in 95 but just three years two
or three years later you know Stanford
MBA with no business experience could
raise 25 million dollars with a single
phone call if they had a internet
business plan so the whole thing is just
two or three years the excitement really
as we could would shortly see when the
bubble burst in the year 2000 the
hyperbolic excitement about the internet
had infected everybody and I was I knew
that there was that we had a fun though
I liked our business and I liked the
fundamentals of our business but I also
knew that the stock price was
disconnected from what we were doing on
a day to day basis and so I was always
preaching we would have All Hands
meetings and there was a small number of
employees at that time but you know
probably let’s see in 97
we would have had a few hundred
employees we would have All Hands
meetings and I would said look you know
we got to remember the great quote from
Benjamin Graham that in the short run
the stock market is a voting machine in
the long run it’s a weighing machine so
don’t think about the daily stock prices
going up
every day whose stock price is going up
and I didn’t want because all the
employees had stock options and I didn’t
want them counting their success that
way and so I was to look when the stock
is up 30% in a month but don’t feel 30%
smarter because when it’s down 30% in a
month then you’re gonna have to feel 30%
dumber and it’s not gonna feel as good
and it was good that I kind of laid that
groundwork because you know sure enough
in the year 2000 the whole thing came
tumbling down I think Amazon went about
$6 what John’s a $6 and that I don’t
even know if that’s on a split adjusted
basis I think that’s probably that was
below I was on a split adjusted basis
probably below $1 so and you know ever
doubt the business model at that point
no so I you know it’s very interesting
to me because I had all the internal
metrics on you know how many customers
we had what was going on I could see
people thought we were losing money
because we were selling dollar bills for
90 cents you know we were very clear
that we were not we were we had high
fixed costs and but we had contribution
margin positive contribution margin and
I just knew that it was a fixed cost
business and as soon as we reached the
sufficient scale we would have a very
good business and so that was that
understanding of the fixed nature of our
expenses relative to physical world
retail is what led us to have the get
big fast strategy we knew that it would
be that our economics would be very much
improved if we can have a sufficient
scale so if we worked hard so so at that
time you’re you’re preaching the
benefits of e-commerce and and really
yeah disintermediating the business so
fast-forward to today now we have
content we have physical Amazon stores
we have Amazon cashier lists stores yeah
we used to call shoplifting
and and then now you shoplifting without
the jail time that’s right and then and
then and then buying whole foods here
for a Texas company so how does that how
does that fit together your vision and
then how do you manage these disparate
businesses with different cost
structures now yeah well maybe finishing
up a little Oh in that prior point
before I answer that question I and and
also with either the memory of Barbara
Bush in all of our minds I I think part
of if you’re a lot of people in this
room are entrepreneurs start their own
businesses done various things taking
risks of various kinds and I think the
one of the precursors one of the
foundational things to being able to
take risk is to have had some kind of
support from somebody you have to have
some mentors you have to have somebody
who loves you these are the kind of
things that build up and allow you to
kind of you know jump off into uncharted
terrain and do something new because you
know you have a support system of one
kind or another and and I’d certainly
did so I for me I just want to point out
that I feel very strongly that there’s a
well I’ve won a lot of lotteries Amazon
is one of the lotteries that I won but I
had a big lottery with my parents my dad
is a Cuban immigrant he came here when
he was 16 years old and speaking English
my great guy and my mother had her had
me when she was 17 years old so she was
a pregnant 16 year old in Albuquerque
New Mexico in high school which was not
cool and she made it work and heard her
parents my grandparents helped her with
that whole thing and made that all work
if you don’t get that kind of support
somehow it doesn’t have to be your
parents sometimes people get lucky it’s
the grandparent or it’s a friend or a
family friend or a teacher it can be
somebody but you need that somebody has
to step into your life and that’s a
lottery that I suspect a lot of people
in this room have also one just like me
so the question go Amazon goes and all
that we do so many different
things so this is a question I says get
how can you do so many different things
why don’t you stick to the Knitting the
kind of traditional advice would be to
stay focused and keep the business
simple and the way I think about this is
we actually do stick to one thing it’s
just not described it’s not the
businesses so we do web services which
is you know big enterprise is buying
compute services from us and we have our
retail business and we have Amazon
Studios which is making original content
Amazon go the things you listed so but
the cultural thread that runs through
all these things is the same we only
have a few principles of the Amazon kind
of core values that we go back to over
and over again and if you looked at each
of the things that we do you would see
those run straight through everything so
the first one and by far the most
important one is customer obsession and
we talk about it as customer obsession
as opposed to competitor obsession and I
have seen over and over again companies
talk about that their customer focused
but really when I pay close attention to
them I believe they are competitor
focused and it’s just a completely
different mentality by the way
competitor focus can work but I don’t
think it works in the long run as well
as customer focus for one thing once
you’re the leader if your whole culture
is competitor obsessed it’s kind of hard
to stay energized and motivated if
you’re out in front whereas customers
are always unsatisfied they’re always
discontent they always want more and so
no matter how far you get out there in
front of your competitors you’re still
behind your customers so they’re always
pulling you along so customer obsession
is a deep principle that underlies
everything we do another one is
eagerness to invent so we love to
pioneer and when we have done by the way
whenever we have tried to do something
in
me too fashion we have failed at it we
need to have something that is
differentiated unique something that
customers are going to like that we’re
kind of leading with so that’s another
element that works for us and then
another one is long-term thinking we are
willing to to take some time and be
patient with our business initiatives
and that runs through everything so a
lot of our competitors might have two to
three year kind of timeframe so we might
have more of a 5 to 7 year sort of
timeframe and then the last one
operational excellence so literally you
know how do you have high standards
around you know identifying defects
fixing defects at the root all those
kinds of things that lead to what I
think also can be in a simpler way just
eat it as professionalism that you want
to do things right just for the rich
sake of doing them right so let’s talk
about that with a with another I guess
this is a corollary now that you have
about 600,000 employees I calculated
you’re adding about 250 people a day
you’ve mentioned that you’re trying to
fend off day – yeah and you said that
day – is stasis followed by irrelevance
followed by excruciating ly painful
decline followed by death yeah that’s
why it is always day one yeah yeah how’s
that work well so day one and this is a
phrase that we use at Amazon all the
time I’ve been using it’s in my first
annual shareholder letter from 20 years
ago and we stay it’s always day one and
it needs to be day one for the reason
that you just mentioned and how do you
it so the real question for me is how do
you go about maintaining a day one
culture you know it’s great to have the
scale of Amazon we have financial
resources we have lots of brilliant
people we can accomplish great things we
have global scopes we have operations
all over the world but the downside of
that is that you can lose your
nimbleness you
lose your entrepreneurial spirit you can
lose your that kind of heart that that
small companies often have and so if you
could have the best of both worlds if
you can have that entrepreneurial spirit
and heart while at the same time having
all the advantages that come with scale
and scope I think think of the things
that you could do and and so how the
question is how do you achieve that the
scale is good because it makes you
robust you know a big box or can take a
punch to the head the question is you
also want to dodge those punches so
you’d like to be nimble you want to be
big and nimble and I find there are a
lot of things that are protective of the
day one mentality I already spent some
time on one of them which is customer
obsession I think that’s the most
important thing if you can it gets
harder as you get bigger when you’re a
little tiny company figure 10 person
startup company every single person the
company is focused on the customer when
you get to be a bigger company you’ve
got all the middle if you’ve got middle
managers and you’ve got all these layers
and the those people are on the front
lines they’re not interacting with
customers every day they’re insulated
from customers and they start to manage
not the customer happiness directly but
they start to manage through proxies
like metrics and processes and some of
those things can become bureaucratic so
it’s very challenging
but one of the things that happens is
the decision-making velocity slows down
and I think the reason one of the
reasons that that happens is that people
all say junior executives inside the big
company start to model all decisions as
if they are heavyweight irreversible
highly consequential decisions and so
even two-way doors you could make you
make a decision it’s the wrong decision
you can just back up back through the
door and try again
even those reversible decisions start to
be made with heavyweight processes and
so you can teach people that these
pitfalls and
and traps and then teach them to avoid
those traps and that’s what we’re trying
to do at Amazon so that we can maintain
our inventiveness and our hearts and our
kind of small companies spirit even as
we have the scale and scope of a larger
company so six hundred thousand people
small company which that’s a that’s a
trick so I know the bush Center we focus
on leadership and I know that you’re
also a voracious reader and you’re fond
of a book by now seem to leave called
the Black Swan yes sure and it’s it’s
about humans tendencies to reduce thing
to anecdote reduce things to anecdotal
stories and to shield us from sort of
the randomness of the way things
actually have to building narratives and
and how can we human will to create a
narrative around anything to connect any
sequence of facts we can create a
narrative so how do you infect that
throughout the whole organization when
you have that many that many layers well
I think what I would say about that it’s
really a little different from the way
that that Black Swan talks about
anecdotes the way you’re talking about
but I’m actually a big fan of anecdotes
in business not building a narrative
structure around them necessarily but I
still have an email address that
customers can write to I see most of
those emails and I don’t answer very
many of them anymore but but I see them
and I and I forward them some of them
the ones that catch my curiosity afford
them to the executives in charge that
area but with a question mark and that
question mark is just a shorthand for
can you look into this why is this
happening what does what’s going on and
what I find is because we have tons of
metrics we have you know weekly business
reviews with these metric decks and we
look at our we know so many things about
customers and there
there you know whether we’re delivering
on time what you know whether the
packages have too much air in them and
you know wasteful of packaging and so we
have so many metrics that we monitor and
the thing I have noticed is that when
the anecdotes and the data disagree the
anecdotes are usually right there’s
something wrong with the way you’re
measuring it and that’s why it’s so
important to to keep your you need to
run it something that you were you’re
doing you know shipping billions of
packages a year for sure you need good
data and metrics and are you delivery on
time you deliver on time in every city
are you delivering on time to apartment
complexes are you delivering on time in
certain countries you do need the data
but then you need to check that data
with your intuition and your instincts
and you need to teach that to the all
the senior executives and and junior
executives so if you’re not answering
your emails can you give us your cell
phone maybe a text is the still have the
to pizza rule and no powerpoints oh yeah
create teams that are no larger than can
be fed with two pizzas we call that the
two pizza team rule no powerpoints are
used inside of Amazon so every meeting
we have that we hire a new executive
from the outside
this is the weirdest meeting culture you
will ever encounter and new executives
have a little bit of you know culture
shock in their first Amazon meeting
because what we do is somebody for the
meeting has prepared a six page memo a
narrative Lee structured memo that is
got you know real sentences and topic
sentences and verbs and nouns not just
bullet points and it lays out been
supposed to create the context for what
will then be a good discussion so and
then we read those memos silently in the
meeting so it’s like a study hall and we
do that everybody sits around the table
and we read silently from usually about
half an hour however long it takes us to
read the document and then we discuss it
and it’s so much better than the typical
PowerPoint presentation for so many
reasons I could talk about this for
although nobody know nobody’s eating the
pizza at that point because we’re
sitting right no pizza usually at that
point yeah you know one author said that
that takes you back to River Oaks
Elementary School in Houston where you
started where they started with a
reading with a silo reading exercise I
never made that connection but I you
know you never know where things come
from I did have a great experience there
so but I definitely recommend a memo
over the PowerPoint and the reason we
read them in the room by the way is
because just like you know high school
kids executives will Bluff their way
through the meeting as if they’ve read
the memo because we’re busy and so you
got to actually carve out the time for
the memo to get read and that’s what the
first half hour of the meeting is for
and then everybody’s actually read the
memo they’re not just pretending to have
read that’s pretty effective
how has your how has your leadership
style change
over the years it’s changed a lot mostly
just because it’s had to you know the
company has changed so much and I can’t
you know the company is ten people or a
hundred people I can be involved in
every decision not just you know not
just the objectives like what are we
gonna do but even the methods how are we
going to do it on a wedge the company
gets bigger as you know the CEO or the
founder whoever it is leading the
company cannot be involved in all of
those decisions they certainly cannot be
involved in the methods of how things
were going to get done so you do have to
change your leadership approach as the
company scales but the the but the
principles of the company have not
changed in fact I probably spend more of
my time now on culture and studying
trying to set high standards for things
the big customer obsession and
inventiveness and things like that so
for me I’m I’m kind of a teacher now so
it’s changed quite a bit and I have this
great luxury I love my job I tap dance
into work even I get back I just got
back from an amazing vacation in Norway
I got to go dogsledding and go to a wolf
preserve and all this really cool stuff
but I couldn’t wait to get back to work
because it’s so fun and the reason
weather is this fun for me is I get to
work in the future so my job I have very
limited kind of day-to-day operational
needs that you know and I’ve constructed
my job so that I don’t have to be pulled
into the present I can state 2 or 3
years in the future and actually I’m I’m
always advising my senior team the
people who report to me that they should
organize themselves in the same way
we’re big enough now that they need to
be able to look around corners
they can’t be if something pulls me into
the president it’s because something has
gone wrong
you know and we need to you know kind of
figure – it’s a firefighting exercise
and that’s not how you should be running
a business of this skill so yeah it’s
changed a lot
okay so following up with that you were
quoted as saying I believe you have to
be willing to be misunderstood overall
we innovate so how are you misunderstood
they’re gonna do is on if you’re gonna
do anything new or innovative you have
to be willing to be misunderstood and if
you can’t tolerate that and for God’s
sake don’t do anything new or innovative
every important thing we’ve done has
been misunderstood often by well-meaning
sincere critics sometimes of course by
self-interested insincere critics but
but you know I’ll give you an example a
thousand years ago we started this thing
called customer reviews and we let
customers review books we only sold
books at that time and customers could
come in and rate a book between one and
five stars and they could write a
text-based review you guys are very
familiar with this it’s now a very
normal thing but back then this was
crazy and the the publishers the book
publishers did not like this because of
course not all the reviews are positive
and the I got a letter from one
publisher that said I have a good idea
for you why don’t you just publish the
positive customer reviews
and I thought about this and because and
his argument is making to me is that our
sales would go up if we just published
the positive customer reviews and I
thought about this I thought I don’t I
don’t actually believe that because I
don’t think we make money when we sell
something we make money when we help
someone make a purchase decision and
it’s just a slightly different way of
looking at it because people are that
part of what they’re paying us for is
helping them make a purchase decision
and if you think about it that way then
you want the negative reviews to and of
course it has been extremely helpful for
people to have negative customer views
and by the way it’s come full circle now
where the product manufacturers use the
customer reviews to improve the next
generation of the product so it’s
actually helping the whole ecosystem but
then now nobody criticizes customer
reviews in fact if you were in the you
know here in the year 2018 if some
ecommerce company were to say we’re only
going to publish the positive customer
reviews that would be the crazy thing
that would get criticized so the new and
innovative quickly becomes the new
normal and then it’s you know it’s it’s
a new incumbent idea and then it doesn’t
get criticized went by the way more
generally and what I preached at Amazon
to all of our employees is when we are
criticized there is a simple process
that you need to go through which is
first you look yourself in the mirror
and decide these are critical right do
you agree
are we doing something wrong if you are
change and by the way if you look
yourself in the mirror and you decide
that your critic as wrong as we did with
the customer reviews then do not change
no matter how much pressure is brought
to bear do the right thing in that case
as well have a deep keel you have
to have a deep teal good so why don’t we
shift to personal away from Amazon a
little bit if if you could write your
legacy what would you want your legacy
to read world’s oldest man as I stole
that that’s not original
but I would love it let’s work on that I
keep telling my biotech friends and
hurry to hello guys come on you know I
don’t know I’m probably if you think
long term and I can talk about this
great length but long term the thing if
you take a really long run view you know
many decades maybe even a couple hundred
years I think the most important work
that I’m doing and I get increasing
conviction on this with every passing
year is the work I’m doing a Blue Origin
on space travel well I don’t what well
why don’t we talk about that okay
because I think I think from a vision
standpoint I think people should
appreciate the horizon that you have so
yeah let’s talk about your kind of view
I’ll call your near-term objectives we
face seventy-five years yeah and then
your long term objective is one hundred
to three hundred years from there well
so first of all you don’t choose your
passions your passions choose you and
all of us are gifted with certain
passions and the people who are lucky
are the ones who get to follow those
things and yet i OS advise our young
employees or meet with interns this one
you can have and my kids too you’re
gonna have a job or you can have a
career or you can have a calling and if
you can somehow figure out how to have a
calling you have hit the jackpot because
that’s the big deal
and most people don’t ever get there you
know you’re very lucky if you have a
career a lot of people end up with a job
and so you know for me I have been
and Rockets space travel propulsion
since I was a five-year-old boy and I
have spent a tremendous amount of time
thinking about it so it’s not like I
really have a choice to follow this
passion it has captured me but I think
it’s very important that we go out into
space as a civilization and the reason
is not the one that you I think is very
commonly there are many reasons that are
there given one of the reasons that is
out there and it’s a very old idea one
of the people who first articulated it
very well was arthur c clarke he said
all civilizations become spacefaring or
extinct and that even may be technically
true in a long run
kind of long enough verison but that
idea is one of the has kind of come to
me that we need to we’ve got all our
eggs in one basket and we need a plan B
you know if we had a civilization
elsewhere on another planet somewhere in
the solar system then when earth gets
destroyed humanity will still be fine I
find this particular argument incredibly
unmotivated we we have now sent robotic
probes to every planet in this solar
system believe me this is the best one
it is not close my friends who want to
move to Mars I say have an idea for you
why are you first for a year moved to
the top of Mount Everest because the top
of Mount Everest is a garden paradise
compared to Mars and and so it’s say
this planet is a gym this planet is
unbelievable and as you travel around
the more you travel around you the more
you see how incredible it is and I’m not
even just talking about nature I’m
talking about the civilization we build
in the urban cities that we have and all
this these amazing things and so we need
to protect it now and I’m not even talk
about protecting it from asteroids or
nuclear holocaust or anything so
although even all this things are
probably important and valid but we
don’t need to worry about that because
we have something more certain that is a
problem and that is if you take current
baseline energy usage on Earth today
global energy usage and compound that at
just 3% a year that in just a few
hundred years you’re gonna have to cover
the entire surface of the earth and
solar cells that’s how powerful
compounding is so and by the way we have
been growing energy usage at a few
percent a year for a long time so and
and we and we our civilization has a lot
of advantages because we increase our
energy usage the human body if we in a
state of nature if you are just an
animal in the state of nature your body
or metabolic rate uses about a hundred
watts of power but a modern person
living in a developed country you
actually use your your your all in
civilizational per capita metabolic rate
is 11,000 Watts we use a lot of energy
that’s about as much energy as a blue
whale uses and so we have you know there
are billions of us and most of us don’t
even
really living in the kind of lifestyle
of a developed country yet but they will
be very soon and we hope they will be we
want them to and so you’re gonna face a
choice
and you won’t face this choice and I
won’t face this choice but your
grandchildren’s grandchildren will face
this choice do you want to live in a
world of stasis or do you want to have a
trillion humans living in the solar
system because the source system is big
earth is small we capture a tiny Earth’s
surface is sort of small it captures a
tiny tiny fraction of the solar output
so once you got into space you have for
practical purposes once again unlimited
resources and the source system can
easily support in Chilean humans they’ve
got a trillion humans and you’d have a
thousand mozart’s and a thousand
Einsteins and so on and so on that would
be a dynamic incredible civilization in
which you would watch your
grandchildren’s grandchildren to live in
I think ultimately earth becomes zoned
you know residential and light in this
industrial and you know we’ll have
universities here and beautiful parks
and houses and but we won’t have big
factories here all of that will be much
better done in space where we have
access to much higher quality resources
and so that’s going to take several you
know that’s a multi hundred year vision
in my piece of this vision is I’m taking
my amazon lottery winnings and I’m
converting them into reusable rocket
vehicles so that we can lower the cost
of access to space because right now the
price of admission to do the interesting
things in space is just too high if I
look at what Amazon was able to do 20
years ago
didn’t have to build a transportation
network it already existed that heavy
lifting was in place we didn’t have to
build a payment system that heavy
lifting had already been done it was the
credit card system we didn’t have to
build put a computer at every desk that
had already been done – mostly for
playing games by the way and so on so
all the pieces of heavy lifting were
already in place 20 years ago
and that’s why as with a million dollars
I could start this company today you
know and then there are even better
examples on the internet over the last
20 years you know Facebook started in a
dorm room I guarantee you two kids
cannot build a giant space company in
their dorm room it’s impossible but I
want to create the heavy lifting
infrastructure kind of do the hard part
so that a future the future generation –
kids in a dorm room will be able to
create a giant space company so that’s
the goal and then because thank you
you’re not gonna you’re not gonna
achieve the vision that I just laid out
of a trillion humans living in space and
having this dynamic world without a big
industry made up of thousands of
companies but it has to start with
making the vehicles much more productive
right now you use a rock at once and you
throw it away and that is just a very
expensive way to do business
so can I talk to them about another
element with to get you to discuss your
vision this may not be germane to the
work you’re doing but I’m but you are
you are one of the great thinkers
artificial intelligence yeah pros and
cons we’ve heard people talk about the
great benefits we’ve heard about
disrupting and changing and leaving off
us all and you know jobless society
we’ve heard autonomous weapons or a
disaster yeah where do you fall on the
on your vision of we’re in artificial
intelligence is going to go and also
some of the I think some of the more
cautionary I’ll say benefits well and
you mentioned a few things there each of
those is worth visiting because they’re
different
I think autonomous weapons are extremely
scary
I think it’s a big and you do not need
general AI so right now the things that
we know how to do you would you should
think of those things is what is called
narrow AI things like machine vision and
so on to build incredibly scary
autonomous weapons you do not need
general AI the techniques that we
already know and understand are
perfectly adequate and these weapons
some of the ideas that people have these
weapons are in fact very scary and so I
don’t know what the solution that but
smart people need to be thinking about
that doing a lot of R&D is there is
there a kind of you know multi it’d have
to be a big treaty like the Geneva
Convention or something that would help
regulate these weapons because you
they’re actually they have a lot of
issues so that one I think is genuinely
scary the idea that there’s going to be
a general AI Overlord that subjugates us
or kills us all I think is not something
to worry about I think that is overhyped
I I’m first of all we don’t know we’re
nowhere close to knowing how to build a
general AI something that could set its
own objectives we have no idea wouldn’t
even it’s not even hardly it’s not even
a valid research area we’re so we’re so
far back on that one so that’s a I think
that’s a very long-term prospect that it
could even happen but second of all I
think it’s unlikely that such a things
first instincts would be to exterminate
us as it seems that would seem
surprising to me maybe employ is much
more likely it will help us you know
because we know we’re perfectly capable
of hurting ourselves you know maybe we
could use some help so I’m optimistic
about that one and certainly don’t think
we need to worry about it today and then
the jobless you know is are we gonna is
a I going to put everybody out of work I
am not worried about this I find the
people all of us I include myself we are
so unimaginative about what future jobs
are going to look like and what they’re
going to be you know if I took him back
in time a hundred years when everyone
almost everyone was a farmer and I told
you know we’re having we’re at some big
farming convention or something and I
say in the year 2018 there is gonna be a
job occupation called massage therapists
they would not have believed you and in
fact I was telling this story to a
friend they said Jeff forget massage
therapist there are dog psychiatrists
and I went I would probably find one on
Hamlin I wouldn’t look that up on the
internet sure enough you can easily hire
a psychiatrist for your dog and so what
you know there is where we we humans
like to do things and we like to be
productive and we will figure out things
to do and we will use these tools to
make ourselves more powerful and and in
fact what I predict is that jobs will
get more engaging yes because you have
to remember you know a lot of the jobs
today are are quite routine they are not
necessarily anybody’s as I said before
career or calling and so I predict that
because of artificial intelligence and
its ability to automate certain tasks
that in the past were impossible to
automate and not only will we have a
much wealthier civilization but that the
quality of work will go up very
significantly and that a higher fraction
of people will have callings and careers
relative to today so can i yet can I
bring you back down
down to the president a little bit and
then I’d be remiss if I didn’t use some
of our time on your personal purchase of
the Washington but yeah
so you buy the Washington Post a few
years ago is it is it going the way you
thought it would go much better much
faster so the post is profitable today
so I bought the post in 2013 the post
was still a fantastic institution at
that time but it was in great financial
difficulty it’s a fixed cost business as
most of all most all publishing is in
their revenues over about six years from
2007 2008 to 2013 had been cut in half
from a billion dollars a year to half a
billion dollars a year and that in a
fixed cost business puts a tremendous
amount of pressure on the business they
were they needed to reduce the size of
the newsroom layoff reporters and and it
was very difficult and Don Graham whose
family had owned the paper for a long
period of time he contacted me through
an intermediary actually and we’ve known
each other pride for almost 20 years
actually and I was very surprised but he
said that he was interested in selling
the paper and he wanted to I said look
like I’m not the right buyer Don because
I don’t know anything about the
newspaper business and he said we don’t
need and into that we’ve got lots of
people who understand this business we
need somebody who understands the
internet better and this was a great act
of love of Don’s because the paper had
been their family for a long time and he
cared more about the paper than he cared
about his ownership of it and he’s if
any of you know him he’s an incredible
gentleman just a wonderful guy and so
overall several conversations he finally
convinced me that I could help and then
I had to convince myself of a couple of
things one was did I really believe it
was an important institution and
and and that for me was a very quick
gait to get through I I you know I I
felt very powerfully that it was an
important institution I do believe that
democracy dies in darkness I think that
the the paper is resides in Washington
DC capital city of the United States of
America the most powerful country in the
world needs a paper like The Washington
Post and so it was easy to decide it’s
an important institution I would not
have bought and tried to help turn
around a financially upside-down salty
snack food company you know I just have
better things to do so that’s why for me
it was so important that it be I might
buy a really well-run healthy soft food
snack company that would just be an
investment and so I so I that and then
the second gate I had to go through
after that was I really wanted to
convince myself that it wasn’t hopeless
because if it had been hopeless you know
also I wouldn’t want to get involved but
I didn’t think it was and and and it has
turned out to work forever well we did
one very simple thing really which is we
switched from it’s been a lot of work
and I don’t mean to make it sound simple
the team has done an amazing amount of
work and we have a great editor and
Marty Baron and a great publisher and
Fred Ryan and a great technical leader
inside lash I mean we’ve got a killer
team at the post but the big kind of
strategic change at the post was
flipping it from being a fantastic local
regional newspaper to being a fantastic
national global newspaper and the reason
we did that is very simple the internet
took away so many gifts from newspapers
mostly there have local ad monopolies
and so on like the internet just solved
all the gifts that newspapers had but
the one gift that had brought to the
table for newspapers is almost free
global distribution
because you can do it digitally and so
we refocused on that and we have to we
had to switch from making a relatively
large amount of money per reader on a
relatively small number of readers to a
small amount of money per reader on a
much larger number of readers and that’s
what we’ve that’s what we’ve done and so
in our time remaining a couple quick
ones yeah
who do you emulate what kind of role
model yeah Oh a bunch of people you know
I have been a Warren Buffett fan in the
business room have been a Warren Buffett
fan since my early 20s I read the things
he writes I am so he’s a very big fan I
think kind of CEOs today out there that
I like again in the business realm Jamie
Dimon I think if there are couple CEOs
that I think if I were a big shareholder
in JPMorgan Chase I would just show up
every Monday morning with like pastries
and coffee for Jamie and I would be like
so you happy you good because I think
he’s a terrific executive and in a very
complicated company same thing Bob Iger
at Disney I think is a superb executive
some probably bring him pastries
so there are a lot of male models
healthy pastries well yeah I guess I
hadn’t thought about that you know
that’s right yeah but and then outside
of that you know I’ve had lots of role
models throughout my life yeah some of
my teachers at River Oaks Elementary
School that you mentioned I had you know
I had my parents so I talked about a
little earlier didn’t talk too much so
my grandfather but he was a gigantic
influence in my life I had the great
good fortune because my mom was so young
my grandparents would take me every
summer starting at age 4
every summer kind of to give her a break
really for the whole summer
so I’d be with my grandparents and on
their ranch in Cotulla Texas which is
halfway between San Antonio and Laredo
we lived in Houston and so we would make
the 5-hour drive out to Cotulla they
dropped me off it’s been a couple of
days there that they go back to Houston
I’d spend the summer and I went every
day as a ranch with my grandfather to
help know a four-year-old boy on a ranch
in South Texas it’s not a lot of help
but I didn’t know that I thought I was
helping and and then it’s like by the
time I was 16 I actually was helping so
I have you know I I can I can suture up
a prolapsed cow I can fix windmills
my grandfather was so resourceful and
that he made his own veterinary needles
he would take a little piece of wire and
pound it flat with a was like a oxy
acetylene torch and then drill a little
hole through it and then we would do we
did all of our own veterinary work some
so we had but we had great fun out there
you know we built barns and welded
things and he bought a d6 Caterpillar
bulldozer used to like 1955 model year
for $5,000 it was completely broken the
gears were stripped and then we spent
you know a whole summer repairing that
and the first thing we had to do to
repair it was build a crane to take the
gears out of the transmission and so you
know what I learned from watching him
was just how resourceful he was he
didn’t ever call a repairman he figured
it out and I do think that that’s one of
the things that you know super lucky for
me to grow up in that environment where
you got to see resourcefulness in action
so my grandfather giant role model for
but Jeff you are you’re an American icon
and these stories really reflect how
grounded you are and starting a company
from the time where you were doing it
yourself to where you are today and to
maintain that touch that you have at the
same time that you have this vision is
really what leadership is all about the
bush center we focus on developing and
recognizing leadership and that’s what
we’re doing this week our time is up and I do want to thank you I also
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