Amazon.com (NASDAQ: AMZN) was once the poster child of what happens when excitement about a company detaches from reality. The headlines "Amazon founder named TIME magazine's Person of the Year," and "Analysts Fear Amazon Is Going Bankrupt" appeared within 14 months of each other around the year 2000. Short of fraud, there little precedent for this in business history.
But 13 years later, Amazon is thriving. It is dominating, in fact, including in lines of business having little to do with its original undertaking of selling books. Shares now trade for three times what they did at the peak of the dot-com bubble.
Thank Amazon's quirky CEO, Jeff Bezos, for this success. He created a culture that's not only different from, but often totally at odds with, how most business leaders think. He's also quite quotable. Here are 20 smart things Bezos has said over the years.
1. "All businesses need to be young forever. If your customer base ages with you, you're Woolworth's."
2. "There are two kinds of companies: Those that work to try to charge more and those that work to charge less. We will be the second."
3. "Your margin is my opportunity."
4. "If you only do things where you know the answer in advance, your company goes away."
5. "We've had three big ideas at Amazon that we've stuck with for 18 years, and they're the reason we're successful: Put the customer first. Invent. And be patient."
6. "I very frequently get the question: 'What's going to change in the next 10 years?' And that is a very interesting question; it's a very common one. I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time. … [I]n our retail business, we know that customers want low prices, and I know that's going to be true 10 years from now. They want fast delivery; they want vast selection. It's impossible to imagine a future 10 years from now where a customer comes up and says, 'Jeff I love Amazon; I just wish the prices were a little higher,' [or] 'I love Amazon; I just wish you'd deliver a little more slowly.' Impossible. And so the effort we put into those things, spinning those things up, we know the energy we put into it today will still be paying off dividends for our customers 10 years from now. When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it."
7. "If you're not stubborn, you'll give up on experiments too soon. And if you're not flexible, you'll pound your head against the wall and you won't see a different solution to a problem you're trying to solve."
8. "Any business plan won't survive its first encounter with reality. The reality will always be different. It will never be the plan."
9. "In the old world, you devoted 30% of your time to building a great service and 70% of your time to shouting about it. In the new world, that inverts."
10. "We've done price elasticity studies, and the answer is always that we should raise prices. We don't do that, because we believe — and we have to take this as an article of faith — that by keeping our prices very, very low, we earn trust with customers over time, and that that actually does maximise free cash flow over the long term."
11. "The framework I found, which made the decision [to start Amazon in 1994] incredibly easy, was what I called a regret minimisation framework. I wanted to project myself forward to age 80 and say, 'OK, I'm looking back on my life. I want to minimise the number of regrets I have.' And I knew that when I was 80, I was not going to regret having tried this. I was not going to regret trying to participate in this thing called the Internet that I thought was going to be a really big deal. I knew that if I failed, I wouldn't regret that. But I knew the one thing I might regret is not ever having tried. I knew that that would haunt me every day."
12. "We innovate by starting with the customer and working backwards. That becomes the touchstone for how we invent."
13. "When [competitors are] in the shower in the morning, they're thinking about how they're going to get ahead of one of their top competitors. Here in the shower, we're thinking about how we are going to invent something on behalf of a customer."
14. "A company shouldn't get addicted to being shiny, because shiny doesn't last."
15. "I think frugality drives innovation, just like other constraints do. One of the only ways to get out of a tight box is to invent your way out."
16. "If you double the number of experiments you do per year, you're going to double your inventiveness."
17. "If you never want to be criticised, for goodness' sake don't do anything new."
18. "If you're long-term oriented, customer interests and shareholder interests are aligned."
19. "Invention requires a long-term willingness to be misunderstood. You do something that you genuinely believe in, that you have conviction about, but for a long period of time, well-meaning people may criticise that effort. When you receive criticism from well-meaning people, it pays to ask, 'Are they right?' And if they are, you need to adapt what they're doing. If they're not right, if you really have conviction that they're not right, you need to have that long-term willingness to be misunderstood. It's a key part of invention."
20. "You want to look at what other companies are doing. It's very important not to be hermetically sealed. But you don't want to look at it as if, 'OK, we're going to copy that.' You want to look at it and say, 'That's very interesting. What can we be inspired to do as a result of that?' And then put your own unique twist on it."
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A version of this article, written by Morgan Housel, originally appeared on fool.com.
