Amazon has never before failed as hard as it did on Thursday when it announced it was scrapping it’s plans to build a second headquarters in New York City.
But the company embraces failure, according to an analysis by CNN.
“I’ve made billions of dollars of failures at Amazon.com,” Jeff Bezos said at the Business Insider Ignition conference in 2014. “Companies that don’t embrace failure and continue to experiment eventually get in the desperate position where the only thing they can do is make a Hail Mary bet at the end of their corporate existence.”
The HQ2 saga that gripped the country and made cities jump through hoops to impress the retail giant, and its ultimate collapse is a “public relations nightmare,” for a company with Amazon’s money and level of influence.
But Amazon — which will pay a reported $0 in taxes on $11.2 billion in profits from last year — has routinely piled up huge losses over the course of its 24-year history, only to increase its dominant share of the online retail market. It was one of the only fledgling companies to survive the “dot-com bust,” as CNN noted, and it’s now the third-most valuable company on the stock market. It actually only became consistently profitable in the past few years when its cloud business took off. Its $10-plus billion profit in 2018 was more than the company made in the prior 23 years combined.
And its investors will keep it afloat because they don’t care and will continue to send its stock soaring. That confidence has given Amazon the capital and freedom it needs to take big risks — and absorb the losses when it fails.
Thanks for reading InsideHook. Sign up for our daily newsletter and be in the know.
