Are you a young entrepreneur looking for some inspiration? When current and aspiring tech entrepreneurs are asked who they look up to the most, they give the usual names: Steve Jobs, Elon Musk, Mark Zuckerberg, and maybe a few will mention Bill Gates. One man that deserves to be on your list is Amazon’s CEO Jeff Bezos. Rightly called the “Man who sells everything”, he deserves all the credit for Amazon’s success. Taking Amazon from a small bookseller shop to the biggest retailer in the world is no mean feat.
This analytical, methodical, quick-to-laugh brainiac entrepreneur isn’t given the attention he deserves. He doesn’t have the charisma of Steve Jobs, run a car brand like Tesla, get the publicity of Zuckerberg (who had an entire movie devoted to him), or share the wealth of Bill Gates. But, in my view, he deserves to be included with all of these entrepreneurs, perhaps even at the top of the list.
Let’s analyze each lesson from Amazon CEO.
1. Focus on Customers, not Competitors
While most companies focus on competitors, Jeff Bezos thinks that it is not the right way to go. He advises young entrepreneurs to get obsessed about customers instead of focusing on competitors. His words also reflect his mindset when he said, “The most important single thing is to focus obsessively on the customer. Our goal is to be earth’s most customer-centric company.” In fact, he also considers being fixated on enhancing customer experience as the secret ingredient of Amazon’s success. If you want to succeed in today’s digitally connected world, you should focus all your energies towards ensuring customer satisfaction.
2. Stick with Two Pizzas
Bezos seems to believe in small, autonomous groups. (Maybe the roots for this go back to his days as a startup CEO.) He believes in a “two pizza rule” for teams, meaning that the groups should be small enough to feed with only two pizzas. This generally works out to about 5 to 7 people in a team.
At Amazon, the two-pizza teams have created the Gold Box feature that we still see today: When teams grow larger, they have a tendency to become less efficient. This inefficiency reduces the output of the team and leads to waste. So keep teams small and let them test.
3. Regret Nothing
It’s tough to leave behind a financially secure, high-powered post like that one. But Bezos claims that he tried to imagine himself decades in the future, looking back on his life: He wanted to be in a position where he would regret nothing. Jumping ship to start a new Web-based company at a moment when the internet’s future was still uncertain was a huge risk–but one Bezos knew he had to take it.
“I knew that if I didn’t try this,” he told Time magazine, “I would regret it. And that would be inescapable.” Bezos calls this attitude his “regret minimization framework.”
Now that Amazon is one of the top companies in the world, it’s clear that Bezos’s risk-taking and regret-avoidance paid off!
4. Be Flexible and Stubborn
The idea of how you can be flexible and stubborn at the same time sounds very confusing because both these words are opposite of each other. Thankfully, Jeff Bezos explained this in his own words when he said, To elaborate this concept, he further adds,
“If you’re not stubborn, you’ll give up on experiments soon. If you are not flexible, you will pound your head against the wall and you will not see a different solution to a problem you are trying to solve.”
The key to success for young entrepreneurs is to know when to be stubborn and when to be flexible and strike a perfect balance between them.
5. Start Narrow, Then Diversify
Today, Amazon sells just about everything, from books and movies to clothing and groceries. And with Amazon Prime and Amazon Studios, it’s getting into the media production game. But Amazon started out selling one thing and one thing only: books. Book sales were Amazon’s proving ground. Bezos envisioned them as the first step towards creating the “everything store” that he envisioned. This strategy–starting with one specific product and building a strong e-commerce system around it before diversifying–let Bezos slowly turn Amazon into an e-commerce giant.
6. Think Long Term
One thing that makes Jeff Bezos stand out from rest of the successful entrepreneurs is that he is not worried about what his quarterly financial reports depict. He focuses on his long-term goals. This is what young entrepreneurs can learn from Amazon’s CEO. If you want your startup to survive long, then you should emphasize on making long-term plans and executing them well. Focusing on short-term profits by compromising on long-term goals is not the way to go if you are serious about your making your startup grow and expand with the passage of time.
7. Never Stop Experimenting
To encourage young entrepreneurs to experiment, Jeff Bezos said,
“If you double the number of experiments you do per year, you are going to double your inventiveness.”
Most successful CEOs and entrepreneurs agree with Jeff Bezos on this point. Do you know why? The reason is that experimentation is the key to generation of new ideas and innovation. Without it, your startup cannot compete against the big boys and the give yourself an edge over your competitors.
8. Identify and Remove Risk
What do you always hear about entrepreneurs? They love risk. They thrive on it and it excites them.
According to Bezos, the best entrepreneurs don’t like risk and work to identify it and remove it in the early days of a business. He says:
“Good entrepreneurs don’t like risk; they seek to reduce risk…Starting a company is already risky, and then you systematically eliminate risk step by step in those early days….you kind of need to systematically identify risk and then as the company gets bigger and more robust, you can start taking risks again but in those early days a lot of it is about ‘okay I have a good idea, how do we reduce risk?’”