Antonio Reza

Antonio Reza



Jeff Bezos took Amazon from zero to a $1 trillion company in 23 years. He documented his journey in his annual shareholder letters. I read all 40,000 words, so you don't have to. Here are 15 lessons that will teach you more about business and entrepreneurship than any MBA:

1| Apply the "regret minimization framework" One question matters in life: On your deathbed, will you regret not doing something? Bezos knew that staying at his hedge fund and not being part of the internet would have killed him. • Use this as your compass

2| Prioritize long-term market leadership Being the market leader at anything takes a long time. Using this principle for decision-making will translate into: -Higher revenues -Bigger profits -Greater returns on capital. • Do this to set the tone of your business

3| Be bold rather than timid in your investments Investing in high-risk, high-return opportunities, will: -Increase market leadership; or -Teach you an important lesson if it fails Kindle was not welcome. But it reinvented the book. • Do this to up your chances of success

4| Free cash flow is the best indicator of stock price Shares are worth the present value of future cash flows. NOT earnings. Amazon operated at a loss for years. But cash flow was positive soon after IPO. Since then, the stock is up 165,000%. • Use this to guide investors

5| Create a cost-conscious culture Once a company reaches a certain size, its cost structure can become inefficient. Bezos created a culture of operational excellence that sought to reduce costs at all times. Economies of scale. • Do this to increase productivity and profits

6| Instill an owner's mindset with equity Bezos believed employees had to think and feel like owners. It is why he preferred to offer more stock options than cash. He would declare the shares would be worth millions someday. He was not wrong. • Do this to attract talent

7| Work hard, smart, and long Building something that will stand the test of time takes blood, sweat, and tears. During interviews, Bezos told candidates that at Amazon they couldn't pick 2 out of 3. It was not for the faint of heart. • Do this to build something special

8| Become obsessed with your customer Amazon is the most customer-centric company in the world. Bezos's true north star was to create the ultimate customer experience. He believed what was good for customers was good for shareholders. • Do this to maximize shareholder value

9| Hire people that will raise the bar of the company Bezos considered 3 things before hiring: -Will you admire this person? -Will this person raise the effectiveness of the group? -In what dimension is this person a superstar? • Use this to elevate the talent in the business

10| Build partnerships to create scale Bezos wanted Amazon to be everywhere. He developed partnerships with companies to increase product selection for customers. From Toys "R" Us to Target. This contributes billions in revenue every year. • Do this to grow your topline

11| Stay focused during a market crash 2000: Amazon lost 80% of its market cap. Dot-com bubble. 2008: Amazon lost 30% of its market cap. Sub-prime mortgage crisis. 2021: Amazon hits trillion-dollar valuation. Focus paid off. • Do this to reap the rewards of your effort

12| Implement effective decision-making Bezos made 2 types of decisions: -Irreversible (1-way door) -Reversible (2-way door) 1st kind is analyzed slowly. It goes wrong, it can hurt the company. 2nd kind is made quickly. It goes wrong, it's OK. • Do this to empower leaders

13| Acquire new competencies to stay relevant Bezos believed in "working backwards" from customer needs. Operating like this demanded the development of new skills to innovate. This is how AWS, Prime, and Marketplace came to life. • Do this to stay market-relevant

14| Invest in technology infrastructure Bezos believed technology would advance exponentially to create opportunities. Today, Amazon uses machine learning to predict anything from the fastest delivery route to customer preferences. • Do this to create competitive advantages

15| It's always Day One Bezos said in every single letter that it was always Day One. Day One is full of excitement, energy, and innovation. Day Two is full of stasis and death. Day One is the embodiment of entrepreneurship. • Believe this to embrace change.

TL;DR -Day 1 -Boldness -Cut costs -Long-term -No regrets -Invest in tech -Free cash flow -Owner's mindset -Elevate the talent -Acquire new skills -Build partnerships -Work hard, smart, long -Obsess with customers -Effective decision-making -Don't fear the market crash

If you found this thread useful: 1. Follow @theantonioreza 2. Retweet the first tweet of the thread. I write about money and tech to help your business grow.

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