Amazon
Writing the playbook for building a global
empire
KYLE BANKS
Amazon.com 1
K. Banks
Robert Kiyosaki, world famous author of over 26 books which includes the
proclaimed number 1 personal finance book “Rich Dad Poor Dad” (Lavingia,
2014) has been quoted saying “most businesses think that product is the most
important thing, but without great leadership, mission and a team that deliver
results at a high level, even the best product won’t make a company successful”
(Kiyosaki, 2016). This is especially true for the internet sales mogul
Amazon.com. Amazon.com has showed the world while focusing on the mission
of customer satisfaction if one includes the right people, acquisitions, and
partnerships astounding growth and success is inevitable.
Amazon, opened for business as the “Earth’s Biggest Bookstore” is currently
the leading online retailer of books (Nasdaq, 2016). The website became
publically accessible July 16, 1995, and by September they had consistent sales of
$20,000 per week. The limited startup funds were, in majority, comprised of a
$300,000 investment from the founder, Jeff Bezos’ parent’s personal savings
account. The frugality of the startup forced Bezos to initially operate off tables
made from doors purchased at Home depot for a mere $60 (Jeff Bezos Biography,
2016).
Amazon.com 2
K. Banks
Amazon.com went public in 1997, and “two years later, the market value of
shares in Amazon was greater than that of its two biggest retail competitors
combined” (Jeff Bezos Biography, 2016). After steadily maintaining value for
nearly 10 years, stocks began significantly climbing in value between 2008 and
2009 as shown below.
Graphic source (Scottrade, 2016)
This significant growth was likely attributed to the Zappos acquisition in 2009 for
$1.2 billion. This is the largest acquisition for the internet mogul thus far (Smith,
2014). The sustained rapid growth enabled the online retailer to surpass U.S. retail
giant Wal-Mart in July of 2015 (Streitfeld, 2015). According to Forbes, this
growth also resulted in Amazon.com being ranked #11 in their 2016 list of the
world’s most innovative companies, #12 on the list of the World’s most valuable
brands, and an astonishing market cap (as of May, 2016) of $292.6 Billion (Forbes,
2016).
Amazon.com 3
K. Banks
This revenue climb normally would be accompanied by a large climb in
profit in a perfect world. This is not, however, the case for Amazon as shown
below. This is because Jeff Bezos and Amazon puts heavier emphasis on cash
flow, and operational capital expenditures than net income (Evans, 2014).
Graphic source (Evans, 2014)
