Bezos and the Payments (a.ok.a., the three B’s): A Seattle Enterprise Story

Bill Gates, Bill Boeing and Jeff Bezos have redefined their industries and the Seattle area. (GeekWire photos by Gates and Bezos; Boeing photo from the San Diego Air & Space Museum archives, via Wikimedia Commons, public domain.)

[Sandeep Krishnamurthy is dean of the School of Business at the University of Washington, Bothell.]

Comment: Jeff Bezos just announced plans to step down as CEO of Amazon. He will continue to serve as Executive Chairman, the model for changing the CEO. He will continue to influence many decisions within the company. From the third quarter, however, there will be a new CEO: Andy Jassy, ​​the longtime head of Amazon Web Services.

Sandeep Krishnamurthy, Dean of the University of Washington’s Bothell School of Business.

This is undoubtedly a global story, but it is also an excellent time to recognize the top tier of business leaders who have emerged from the Seattle area. Jeff Bezos now joins Bill Boeing and Bill Gates as the three greatest entrepreneurs in Seattle history. Together they established our region as an inventive powerhouse and opened up completely new spaces.

The companies that developed the “three B” are world champions: Boeing, Microsoft and Amazon. And they remain at the heart of the Pacific Northwest economy. They all offer compelling products that define markets and change customers’ lives. Flying a Boeing airplane, working on a device that uses Microsoft software, or having products shipped through Amazon is a part of customer life around the world today.

Each of the companies is exceptionally profitable and all three are top notch employers. In 2020, Amazon’s sales were $ 386 billion, Microsoft’s were $ 143 billion, and Boeing’s were $ 58.2 billion (although a few years ago it was $ 100 billion ).

And it all happened here in Seattle.

innovation

Each of these innovators brought out products that were considered absolutely impossible. Nobody thought we could fly. Even after the Wright brothers demonstrated this, there was little evidence that we would have a worldwide network of travel by air. However, Bill Boeing, a timber merchant, found a way to use his experience to not just build the first commercial aircraft, but create an entire industry.

Very few people saw the future of personal computers. The early efforts were viewed as ultra-technical. Microsoft computers run the world’s most complex organizations today. And nobody would have thought that the internet could be used to order anything we can think of for fast delivery. And yet Amazon has become the machine that translates customer clicks into brown cardboard boxes that mysteriously arrive on the doorstep.

Unfinished 737 outside Boeing’s Renton facility. (GeekWire Photo / Kevin Lisota)

Bill Boeing and Jeff Bezos both emigrated to this region. Boeing was from Detroit. Bezos was born in New Mexico and later worked on Wall Street. Bill Gates is a native. They all recognized the regional advantages: physical infrastructure, technical workforce, and a receptive business environment, to name a few.

All three entrepreneurs have found ways to use their initial success to build various portfolios of profitable businesses.

The conglomerate built by Bill Boeing included United Airlines (transport), Pratt and Whitney (aircraft engines) and of course the Boeing Co. (aircraft). Microsoft today is a fundamentally global company with various software and hardware operations (e.g. Xbox, HoloLens).

Similarly, after starting out as an online bookstore, Amazon has grown into a company with a multitude of dimensions. Amazon now owns a fleet of planes, satellites, and drones. In many ways, Amazon has already become a transportation conglomerate.

Contrary to its relatively humble initial ambitions, the breadth of Amazon’s current activities was inconceivable on day one. Currently, Amazon has a few key pillars: online retail, third-party fulfillment / logistics, advertising, and the AWS cloud platform which, along with Microsoft Azure and Google Cloud, is redefining the nature of computing.

In principle, all three companies have democratized important industries. Bill Boeing envisioned a commercial airline that anyone could fly. Bill Gates envisioned computers not occupying entire buildings, but helping the average person to be more productive. Bezos democratized the world of online shopping by blaming the customer instead of traditional business.

Culture

All three company leaders also built strong cultures capable of maintaining or accelerating their original vision.

Bill Boeing had a sign on the wall that said, “2329 Hippocrates said: 1. There is no authority but facts. 2. Facts are obtained through close observation. 3. Deductions are only to be made from facts. 4. Experience has shown the truth of these rules. “

Bill Gates made his “Think Weeks” famous, in which he personally withdrew and read memos from employees across the company.

Jeff Bezos created a work culture where employees write six-page memos and spend time reading the memo from the group first. He advocated making some good quality decisions, obsessing over customers, not paying too much attention to the stock market, and accepting failure.

Antitrust law

All “three B” were investigated under antitrust law. The scale of the organizations they built was so huge that they caught the attention of regulators.

Bill Boeing’s business was split into three separate entities: Boeing, Pratt and Whitney, and United Airlines. Microsoft has gone through a highly competitive antitrust move to link the operating system and web browser. Jeff Bezos has gotten his share of antitrust attention, especially from third party vendors.

Philanthropy and Social Impact

In addition to this immense innovation at Amazon, Bezos is actually now bigger than Amazon itself. He owns the prestigious Washington Post, the flag bearer of American journalism. And his space company Blue Origin focuses on suborbital flight. I have a feeling he just won’t stop there. By stepping down as CEO, Bezos has gained the flexibility to innovate even further. He can invest or start new companies that have immense potential.

Microsoft Co-Founder Bill Gates (GeekWire Photo / Kevin Lisota)

All “three B” have made meaningful contributions to philanthropy. Bill Gates is clearly the leader of the three with his Bill & Melinda Gates Foundation, which has now become the largest non-profit organization in the world. Jeff Bezos got into philanthropy late. He’s probably only really thought about it for the past decade, and many have argued that he and Amazon just hadn’t done enough. It is impressive to see that homelessness and sustainability are the main focus.

As with any other philanthropic endeavor, there are critics and critics. However, there is no doubt that these efforts have made a world of difference in many lives. Boeing has been a strong advocate of various community organizations ranging from health and personal services to education. The persistence of his support was particularly appreciated. However, there is legitimate criticism of Bill Boeing’s role in the housing alliances.

Jeff Bezos was certainly paying attention to the political climate when he decided to resign. There is impetus for union formation among warehouse workers at Amazon, including an upcoming vote. Democratic presidential candidates also argued that Amazon did not pay its fair share of taxes. According to the Wall Street Journal, the company reported a $ 1.8 billion tax payment in 2020 and is expected to pay even more in a Biden-Harris administration in the coming years.

The changing political climate may have put further pressure on the company for affordable housing, environmental sustainability and union support. It remains to be seen whether Amazon will solve these problems by automating even further or by supporting its employees. Many see support for the automation route in Jassy’s hiring, but that’s just speculation right now.

Succession

The decision to resign is always difficult for a founder. Bill Boeing left the company after antitrust law and aircraft designer Claire Egtvedt took over management. Bill Gates left Microsoft to his longtime colleague Steve Ballmer, who has since been replaced by Satya Nadella as CEO. Now Jeff Bezos has left the reins to Andy Jassy.

There’s a pattern of handing over the reins to a longtime employee, and Amazon is no different. In the case of Microsoft, Ballmer changed the tenor of the company from a technology-oriented company to a sales-oriented company. Given Andy Jassy’s technical work, he’s likely to be driving a future that puts AWS in a more central position.

Overall, there must be something in the water here in Seattle. We have a tremendous track record of building great innovative companies. Here you can find the “three B” and their immense contributions to society and the world. I am sure that the next generation of different innovators will be ready to continue this tradition for years to come.

The opinions expressed here are those of Dr. Sandeep Krishnamurthy. They do not purport to be an official University of Washington or UW Bothell position.