Jeff Bezos At The Economic Club Of Washington (9/13/18)

here's one thing you think is responsible for several things because 70% is pretty good now. You know, I've been speaking, they have all-hands meetings at Amazon and for 20 years since we're about 21. Years ago, in 1997, at almost every All Hands meeting I said, look, when the stock goes up 30% in a month, don't feel 30% smarter because when stocks go down 30% in a month you won't feel as good. You'll feel 30% dumber and that's what happens. You know the great quote that Warren Buffett mentions all the time, but Benjamin Graham said, "In the short term, the stock market is a voting machine; in the long term, it is a weighing machine." What you should do is operate your company in such a way that you know it will shake up someday and just let it be weighed and never waste time thinking about the daily stock price.

I'm not okay, as a result of going up seventy percent this year you have become the richest man in the world is that a title that you really wanted or it is not I can assure you that I have never sought that title and it was good to be the second person richest in the world that actually worked well and it doesn't. I would say that people are something that people are naturally curious about. You know, it's the kind of interesting curiosity, but it's not something I would prefer if they said, "I'm, you know, an inventor." Jeff Bezos or businessman Jeff Bezos or, you know, father Jeff Bezos, those kinds of things are much more meaningful to me and you know it's a measure of production than if you look at the financial success of Amazon and the stocks of the that I own 16 percent Amazon and Amazon is worth about a trillion dollars, which means that what we've built over 20 years we've created eight hundred and forty billion dollars of wealth for other people and that's really what we have, from a Financially, that's what we've done, we've created eight hundred and forty billion dollars of wealth for other people and that's great, that's the way it should be, you know, I'm a big believer in the power of corporate capitalism and free markets. to solve many of the problems.

The world's problems are not all, but they are many, so you live in the state of Washington, near Seattle, where outside of Seattle now the man who was the richest man for about 20 years is called Bill Gates, yes, and What is the probability that the two richest? Men in the world live not only in the same country, not only in the same state, not only in the same city, but in the same neighborhood. I mean, is there anything in that neighborhood we should know about and are there any more houses for sale from then on? right after I saw Bill not too long ago, you know, we were joking about the richest man in the world and I basically said thank you, no, I said you're welcome and he immediately turned to me and said thank you, but no, Medina is Great, it's a suburb of Seattle and you know, I don't think there's anything special in the water there and you know I located Amazon in Seattle thanks to Microsoft.

I thought that large pool of technical talent would be a good place to recruit. talented people and that turned out to be true, so it's not a complete coincidence, there's some correlation there, but when you're the richest man in the world you go to a store when you want to buy something, do you have to put in a credit card? down you just say I'm Jeff Bezos and they send you this and you have to worry, you have cash with you, you can, yes, I carry cash and I have, I have credit cards, yes, and if your credit, I have to show my driver's license and that's it You know, but have you ever had a credit card ID?

Don't have. My credit card has been denied. I would say try this, so today you made an announcement that is the largest philanthropic donation you've made in the pipeline. About a year ago he said he wanted to look at some good philanthropic ideas and I think I got 47,000 of them and you did go through them and how did you decide where to put this two billion dollars? Would you describe exactly what you are going to do? Well, that process was very helpful, so I asked for ideas, kind of crowdsourced and I got literally, like you said, something like 47,000, maybe even a little bit more, someone came to my inbox, most of them came to social media and I read thousands and thousands of them, my office correlated them all and put them in buckets and there were some themes that emerged, but the other thing that's fascinating about the type of exercises, you see, how long the line is, the People are interested in trying to help the world in many different ways and it's all the things you would expect, you know, but also some more unusual things, but you know some people are the best at the arts and opera and they think that's not is underfunded, so a lot of people are interested in medicine and particular illnesses and think they deserve more dollars Rd, all of these things are right, a lot of people are very interested in the homeless, including me, a lot of people are very interested in education and all kinds, all kinds of interesting things, both college scholarship type education and apprenticeship programs, so whatever, people are interested in education I am very interested in early education and I made them knowing that the apple does not fall far from the tree that my mother has become by running the Family Foundation where she has become an expert in early education I am a student of Montessori Schools I started in Montessori when I was two years old and the teacher He complained to my mother.

The teacher at the Montessori school complained to my mother that I was too focused on assignments because she couldn't get me to change assignments, so I would have to. just grab my chair and move me and by the way, I think if you ask the people who work with me, it's probably still true that the teacher has since called you and told you that she was responsible for your success. Oh no, I'm in touch. However, several of my high school elementary school teachers, but I don't know any of my Montessori school teachers, so the gift you're giving essentially is that you'll have some for preschool for kids who need preschool for Eitri, yeah, well, full registration.

Montessori inspired preschool I'm very excited about it because I'm going to operate that will be an operating nonprofit I'm going to hire an executive team there will be a leadership team we're going to operate these schools and we're going to put them in low income neighborhoods no There is no doubt that we know for sure that if a child falls behind it is really very difficult to catch up and if you can give someone a help when they are two, three or four years old, when they reach kindergarten or first grade, it is much less likely to be delayed.

It can still happen, but it has really improved your odds and many of you know and probably most of the people in this room have been very conscious of doing I'm sure your children received a very good preschool education and have that type of Head Start that Head Start compounds fantastically if you can get it, you know starting at age two three four there's a powerful compounding effect there, so it's very leveraged, that's all. it really means that you know you can, the money spent there will pay huge dividends for decades, so the other part of your donation will be to give rewards to yes and that will be more traditional grantmaking philanthropy, so there I am.

I am going to identify myself with the help of a team. I am going to identify that we are going to hire a full-time team. I will identify and fund that and fund shelters for homeless families. And that will be what you said you would give an initial two billion dollars, I hope. To add to that, yes, it's day one, everything I've done started small, Amazon started with a couple of people and Blue Origin started with five people and Lords' budget was very, very small, now the budget of origin is close to a billion dollars. one year and next year it will be over a billion dollars, so on Amazon, which was literally ten people today, it's half a million people, but you, you, it's hard for you to remember, but for me it's like Yesterday I was taking the packages to the post office. office and I hope that one day we can afford a forklift and so on, but so, for me, I have seen that small things become big and it is part of the mentality of this day.

I like to treat things as if they were small. You know Amazon even though it's a big company, I want it to have the heart and spirit of a small one and anyway, the day one foundation is going to be like that, it's going to wander around a little bit too, so we have some very specific ideas. about what we want to do it, but I believe in the power of wandering, all my best decisions in business and in life have been made with my heart, intuition, guts, you don't know, it's not an analysis, when you can make a decision with an analysis, you must do it, but it turns out in life that the most important decisions are always made with instinct, intuition, taste and heart, and that is what we will do with this foundation of the first day;

It's part of that day one mentality as we move forward, you know, building this network of nonprofit schools that We'll learn new things and figure out how to make it better, so one of the decisions that the client will make will be the child. This is very important because that is the secret sauce of Amazon where There are several principles at Amazon, but the main thing that has made us successful by far is the obsessive-compulsive focus on the customer instead of the obsession with the competitor, and I speak very often with other CEOs and some other CEOs and also with founders and entrepreneurs and I can say that even though they are talking about customers, they are actually focusing on competitors and it is very important for any company if it can stay focused on your customer rather than your competitors, then you must identify who your customer is.

At the Washington Post, for example, it is the client, the people who buy advertising from us know that the client is the reader and that's it, the client is the reader and then, by the way, where do advertisers want to be? Advertisers want to be where there are readers. It's really not that complicated, you know, it develops very well and in school, who are the clients? Are they the parents? Are they the teachers? No, it's the child and that's what we're going to do. obsessively compulsively focused on the child we will be scientists when we can be and we will use our heart and intuition when we want when you use your intuition you make decisions where does intuition take you now to your second headquarters?

Can we take a moment to acknowledge that that may be the best transition in the history of seriously interviewing David? So, okay, that's an amazing answer. The answer is very simple. We will announce the decision before the end of this year. So we have made tremendous progress, the team is working hard and we will get there. No, no, be nice, come on, but you know you already have something in one Washington and what about another area of ​​Washington that you have? Yes, no, that's correct. We in Seattle call this the other Washington Well, this is it, speaking of Washington, you bought a few years ago, when you mentioned the Washington Post, why did you buy the Washington Post?

You had no experience in that area, what convinced you to do it? First of all, I wasn't looking for a newspaper, I had no intention of buying a newspaper, I had never thought about the idea, it never occurred to me, it was never a thing, it wasn't like a childhood dream, nothing, and my friend Don Graham , who at that time. I knew him for 15 years, I've known him for 20 years and now he approached me through an intermediary and wanted to know if I would be interested in buying the Washington Post and I told him I wouldn't because I didn't really know anything about The Newspapers. and Dawn over a series of conversations convinced me that I thought it wasn't important because we had within the Washington Post, we have a lot of talent that understands newspapers, that wasn't the problem, but what they needed was someone who understood the Internet.

And that was the first thing that started and then I did some soul-searching and again my decision-making process, something that would definitely be intuition and not analysis of the financial situation of the Washington Post in At that time, in 2013, everything was upside down. and it was a fixed cost business and they had lost a lot of revenue in the previous five or six years, not through the fault of the people who worked there or the leadership team, the whole paper had been handled very, very well, the problem was secular, the Internet was just a way, all the traditional advantages that the local newspapers had, I mean, that was just taking away all the gifts that the local newspaper had, it was systematically eliminated by the Internet. and that's why you see this being a deep issue in local newspapers all over the country and actually all over the world, so I had to do some soul searching and I said, you know?

Is this something I want? get involved, if I'm going to do it, I'm going to put some heart and some work into it and I decided that I would only do it if I really believed it was an important institution and I said to myself that if this was a salty snack company that was financially upside down, the answer It would be no, but it was very early when I startedI said: I don't want to regret it. I have in my life and most of our regrets are acts of omission, they are things we didn't try, it's the road not taken, those are the things that haunt us and anyway, I have one of those that relates to this, yes, do you know when?

You were trying to get the bibliography of books and prints to sell.To a company my company owned Baker and Taylor Acre and Taylor which had started in 1839 never made a profit since 1839 it was always a break even point and according to I understand, you told the seller that you would give them a small portion of the company you were starting you would have a lot of cash, our sellers said no we don't want a part of the company we want some cash yes so you gave some effective and later, when I found out about this, I flew to see you.

Yeah, in your run-down little office building and I said, "You know," I think that's like 1997. This was a long time ago, the first time we met, so I said the deal wasn't that good, that we I would like the part of the company. Whatever you were thinking of giving us and you were actually very kind, you didn't say get out of here, I don't need you anymore, you said look, I don't really need you, frankly, but you were helpful in the beginning, so I'll close the deal and give you I will give a small part of the shares, yes, and you did, and those shares today are worth about five billion dollars, unfortunately we sold them right at the IPO, yes, but it is a testament to your character that that doesn't bother you, It does bother me.

I mentioned it every day, in fact, I think about it every day, but I do remember when I went out and you had your desks labeled, you had doors where yes, we still have them and you told me that you had to go to. deliver the books, yes, to the post office yourself. I still don't deliver them, but I was doing that for years and I said I was packing boxes that maybe I didn't know, on my hands and knees, for the first month. boxes on my hands and knees on the hard cement floors and with someone else who wasn't standing next to me, kneeling next to me, we were packing and I said, you know what we need, knee pads, this is to kill my knees and This guy The guy packing next to me said we needed packing tables and I thought that was the most brilliant idea I had ever heard and the next day I went and bought packing tables and it doubled our productivity, so where does the name Amazon come from? ?

River Earth's biggest selection is fine, it seems simple, was it an easy choice or were there other candidates. Well, I called the first name Cadabra. I was. It had music. It is difficult for you. It's very difficult to impress you. How small this beginning was. I was driving to Seattle. I wanted to start working. I wanted to start a company and I wanted to have bank accounts set up. So I called a friend and he recommended me to his lawyer. It turned out that this guy was actually his divorce lawyer. but this guy incorporated the company for me and opened bank accounts and said I need to know what name you want the company to have for the incorporation documents and I said this is over the phone.

I said Cadabra as hocus-pocus but I just sued. Cadabra and he said corpse and I said okay that's not going to work but I like to go ahead with Cadabra for now and I'll change it and like three months later I changed it so what made you sell things other than books and Obviously, if you only sold books today, you would not be the richest man in the world. Presumably, it's the idea that you were selling other things. When did the idea of ​​selling other things first occur to you? After the books, we started selling music and then. we started selling videos and then I got smart and emailed a thousand randomly selected customers and asked them, in addition to the things we're feeling today, what would they like us to sell and that response was incredibly long, people basically said the way in which they responded. the question was with what they were looking for at that time, so as I remember one of the answers was: I wish you had sold wiper blades because I really need wiper blades and I thought we can sell anything this way and So we launched products electronics and toys and many other categories over time and the vision became that you read the original business plan, it's just books, well, in 1997 you went public, yes, and the value of the company was less than a thousand million dollars and maybe six hundred million. or something like three three three something like that, I think our IPO and then it tanked for a while, its stock at one point I think went up to $100 but then it went down to six or something like that at the peak of the Internet bubble.

The stock peaked at about a hundred and thirteen dollars and then after the Internet bubble burst, you know, our stock went down to six, went from a hundred and thirteen to six in less than a year. My annual shareholder that year begins with a one-word sentence. and that one word sentence is the word ouch, so most of those dotcom era internet companies are out of business. Yes, you survived, what made you survive? and practically the rest of them left. Well, it's the whole period. it's very interesting because the stock is not the company and the company is not the stock, so while I was watching the stock drop from one hundred and thirteen to six, I was also watching all of our internal business metrics, the number of customer profits per unit , you already know. everything you can imagine, defects, etc., every aspect of the business was improving and rapidly, so as the stock price was going the wrong way, everything within the company was going the right way and I , you know, we didn't.

We need to get back into the capital markets, we didn't need more money, the only reason you know a financial crisis like the bursting of the internet bubble is that it makes it very difficult to raise money, but you know we already had the money we needed , so I just needed to keep progressing. Wall Street kept saying, "Well, Amazon isn't making money, it's just getting customers where profits are profits and Wall Street kept hitting you for that and your response was, I don't really care what you think." I was on TV with Tom Brokaw, he brought together half a dozen Internet entrepreneurs from that era, you know, I think it was right before the bubble burst, maybe they were right after I filmed, but in that area and he I was interviewing everyone. us and he finally he turned to me and said mr.

Bezos can you even spell profits and Tom by the way Tom Brokaw is now one of my good friends and he says he can even spell profits and I said sure PR OPH et and he started laughing and but look I Amazon was you ? I know people always accuse us of selling one dollar bills for ninety cents and say, "anyone can do that and increase revenue, that's not what we're doing, we've always had positive gross margins, it's a fixed cost business and what I could see is that from the internal metrics are that at a certain level of volume, we would cover our fixed costs and the company would be profitable, so who came up with the idea Prime Prime seems to be a great way to? getting money before people actually get the services Yes.

Sorry, it's actually very interesting, like a lot of inventions within a team and I love inventing as a team is my favorite activity, so I tap dance in the office. I love Amazon, I have a lot of fun there, I love Blue Origin, I love The Washington, but Amazon is my full-time job and I get to live two or three years in the future and most of the inventions we do. That's if someone has an idea and then other people improve the idea and others. people come up with objections about why I can never work and then we resolve those objections and it's a really fun process.

Prime there were a couple of things, one of our board members, Gordon, always wanted us to have a loyalty program and he would every V bring this up at every board meeting and, you know, loyalty programs in the What we would think were things like frequent flyer miles which don't really work in a business like Amazon, in my opinion there are a lot of reasons why I work for airlines, but that's different and there are structural differences, so we keep thinking, but we always think we asked what a loyalty program could be and then actually some kind of junior software engineer came up with this idea, not like a loyalty program, but this idea that we could offer people a kind of all-you-can-eat buffet. with fast and free shipping and when we modeled it, then you know the finance team went and modeled that idea and the results were horrible, that we would offer unlimited. shipping Shipping is expensive and we and customers would love free shipping so at this point we already had something called Super Saver free shipping where we would do it in exchange for letting the product get to you very slow and in exchange for having a certain minimum o If you have a size threshold, then you could get free shipping, but this was not going to be an order threshold, so you could buy a single $20 item or a single $10 item and free two-day shipping, and when we modeled this it didn't look pretty, but we could see, I mean again, you have to use your heart and intuition, there has to be risk taking, you have to have instinct, all the good decisions you have made that way, you do it with a group, you do it with great humility because the way we do it wrong it's not that bad, that's the other thing when we make mistakes and we've made Dizzy like the fire phone and a lot of other things that just didn't work .

I can, I could, we don't have enough. It's time for me to list all our failed experiments, but the big winners pay for thousands of failed experiments, so try something like Prime and it was very expensive in the beginning, it cost us a lot of money because what happens when you offer a free service? -buffet-you-can-eat who gets to the buffet first those who eat a lot it's scary it's like oh my god did I really say as many shrimps as you can eat and that's what happened but surely we could see the trend? lines we can see that you know the different types of customers that came and appreciated that service, that's what your team has by the way they are a feeder, my answers are too long, your audience interrupted me so I'm not used to it . to cut off the richest man in the world, I'm not, so let me ask you this, you're killing me David, when he said you sit with your team and stuff, but you didn't like meetings before 10:00.

A.M. No, you would like to sleep eight hours. I don't like powerpoints, explain all that. Why is it okay? Many, so I like to be in the room. I get up early. I go to sleep early. I get up early. I like it. play in the mornings I like to read the newspaper I like to drink coffee I like to have breakfast with my children before they go to school so I have my time to play is very important to me and that's why I scheduled my first meeting at 10 o'clock I like to do my high IQ meetings before lunch, like anything that's going to be really mentally challenging, it's a 10 o'clock meeting and because at 5:00 p.m.

I think I can't think of that today, let's try this again tomorrow at 10:00 am. m. and then while I sleep, I sleep 8 hours. I prioritize it unless I'm traveling in different time zones. Sometimes it is impossible, but I am very focused on that and therefore I need a sleeping daughter. I think I better have more energy. My mood is better. All these things and think about it as a senior executive. What do you really get paid for as a top executive? I get paid to make a small number of high-quality decisions. Your job is not to make thousands of decisions every day, so let's say I slept six hours a day, well, let's go really crazy and say I slept four hours a day, so now I only got four so-called productive hours back, so If I were to say twelve hours of productive time during any waking day, now all of a sudden I have 12 plus 4, I have sixteen productive hours, so I have 33% more time to make decisions, so if I was going to take one hundred decisions, now I can make 133 decisions, but if I did that arithmetic wrong, sorry, then you make one hundred and thirty-three decisions, that's really worth it if the quality of these decisions can be lower because you're tired or in a bad mood or whatever. number of things now is different if it is a new company.

I mean, you know you really know when Amazon was a hundred people, different story, but Amazon is not a new company and all of our senior executives operate the same way I do, they work in the future, they live in the future, none of The people who report to me should really focus on the current quarter. I always tell people, sometimes I understand, you know. I'll have a nice quarterly conference call or something and Wall Street will like our quarterly results and I'll have people stop me and congratulate me on your quarter and I'll thank you, but what I'm really thinking is that quarter was baked three years ago. years,right now I'm working on a quarter that will be revealed sometime in 2021 and that's what you have to do, you have to go out, you know, two or three years in advance and if you are and then why do I need to make a hundred decisions Today, if I make like three good decisions a day, is that enough and should they be of the highest quality possible?

Warren Buffett says it's good if you make three good decisions a year and So You Know, and I really think that's how I care, it was like a triple compound question, so you probably have at least time. Let me ask you this, okay? Who has revolutionized retail and people buy so many things over the Internet? People are obsessed with buying things. or by the way, when you shop online on Amazon, do you ever get wrong orders? Is there ever a problem? What do you do if you call and complain or don't have a problem? Oh, I'm an Amazon customer.

Hopefully, like all of you on this, there isn't a single person with full Tyner service. Not even this room that is not an Amazon customer sees me immediately after and I will guide you. It's me and I and we treat them like the same way I treat a problem that I would get from the client my email address is famous and I keep it and then I read it. I'm Jeff at amazon.com. I no longer see all the emails I receive because I receive too many, but I see a lot of them and I. I use my curiosity to select certain emails.

I receive one from a customer and there is a defect. You know we've done something wrong. Usually people don't always fool us, but usually the writing is because we've messed up their order in some way and I'm so I look at this and for some reason something seems a little strange about it and because That's what I get out of the team to do a case study and find the real cause or causes, it usually causes real causes and then real root fixes so that when you fix it you're not fixing it for that client, you're fixing it for each client and that process is a huge part of what we do, so please let me know if I have a failed order or any bad customer experience.

I would treat it like that. Oh, you've revolutionized retail, as I say, but now you were in the brick-and-mortar business and you bought Whole Foods. Yes, it was the theory behind buying something that doesn't sell things in the market. Internet, well, we are very interested in physical stores and we have them. I've been asked for years if we ever open physical stores, literally 20 years of an asset question and I always say yes, but only when we have a differentiated offering, something no. Me too because that physical storage space is very well served if we offer a me too product offering, it won't work, and we're also not very good at it most of the time when we try to get into something. that's a me too service, we tend to get beat, it doesn't work, our culture is much better at pioneering and inventing, so we have to have something that's different and that's what Amazon Go is, it's completely different, the entire Amazon bookstore. different and we have ideas about how to merge Prime and Whole Foods so they are still being implemented.

You haven't seen them yet, but using Amazon Prime to make Whole Foods a very differentiated experience and continuing to add technology to that. and what you know, basically Whole Foods, I love when I talk to Amazon, they buy a lot of companies, they're usually a lot smaller than Whole Foods, but we buy a lot of companies every year and I always try to evaluate what I find. With the businessman who founded the company, I am always trying to find out one thing, first of all, whether that person is a missionary or a mercenary and the mercenaries are trying to invest his shares.

Missionaries love their product or service and they love their customers. Trying to build a great service by the way, the big paradox here is that it's usually the missionaries who make the most money and you can tell that very quickly just by talking to people and when I met John Mackay, who is the founder of Whole Foods, he just It's a missionary company, he's a missionary guy, so what we're going to be able to do is take some of our resources, some of our technical technological know-how and expand the mission of Whole Foods. They have a great mission which is to provide nutritious food. for everyone, organic nutritious food for everyone, but you know that we have a lot to contribute in terms of resources, but also in terms of operational excellence and in terms of technological knowledge, now one of the other companies that you started with in your The company that is technologically superior is Amazon Web Services, where the idea of ​​AWS came from.

We started it, I don't know, a long time ago, 15 years ago, worked on it behind the scenes for a long time and finally released it. It has become a very large company and at AWS we completely reinvented the way companies use computing in traditional ways. If you are a company and need computing, you would build a data center and fill it with servers. You would have to update the operating systems on those servers and keep everything running etc., none of that added any value to what the business was doing, it was kind of the price of entry, you know, undifferentiated heavy lifting and what we saw in Amazon is what we were doing, we were building data centers for ourselves, so what we saw was a tremendous waste of effort between our applications engineers and our network engineers, the ones who manage the data centers, and they had to have many. of meetings and planning fleet sizes and all these non-value-added tasks and we said, look, what we can do is develop a set of hardened APIs that allow these two groups, the applications engineers and the network engineers, to have meetings instead of these. detailed meetings and then we'll expose those APIs to the applications engineers and they can take as many compute resources as they want and as soon as we came up with that plan, it became immediately obvious to us that we would do it ourselves. and as soon as we did it, it was immediately obvious that every company in the world would want this and then something happened, then a business miracle happened, this never happens, it's like the biggest stroke of business luck in the history of business, as far as I know.

I know we haven't faced like-minded competition for seven years, it's awesome and we like it. I'll tell you about it like when I launched amazon.com in 1995. Barnes & Noble launched Barnes and noble.com in 1997. Two years. That's very applause. It's very typical. if you invent something new we launched Kindle Barnes and Noble we launched Nook two years later we launched Ecco Google launched Google Home two years later when you are a pioneer if you are lucky you get a two year head start no one gets a seven year head start and So it was amazing because, and I think it was a whole confluence of things, I think the big established enterprise software companies didn't see Amazon as a credible enterprise software company, so we had this long-term path to build this incredibly rich little guy. in functions. and it's way ahead of all the other products and services available to do this job today and the team doesn't stop, this team led by Andy Jesse at Teresa is here, so we're where you, Teresa, Teresa, all here in Washington they know.

Teresa, but this team is just killer, I mean, they're just innovating on the product side so quickly and they're executing everything so well. I am incredibly proud of them. Amazon itself has virtually no competition in its online sales, so who is number two for you in online sales? There is practically no one, our competition is, we are cut off, where we rub shoulders with customers is in the physical world, in other words, when people choose between us, there was about 40 percent of sales online, but we thought that I don't know a low single digit percentage of retail sales, so you know 97, 98 percent of sales, eighty-five percent of sales are still or more are still in the physical world, So that's where we face the competition.

Are you worried that a U.S. government might appear or where European governments say you're so big and so powerful that, even though you haven't done anything that is traditionally monopolistic, you're just too powerful and some regulatory issue could arise that hurts your business. no this is this is where I think about it I have I have a couple I get asked this question a lot I thought it was an original question now I'm sorry you do that sometimes but that's not one of them and my point of view on this is very simple in general institutions of any type are going to be and must be examined, scrutinized, inspected, governments must be inspected, government institutions, large educational institutions, large non-profit organizations, large companies, will be subject to scrutiny, it is not personal, it's kind of like we as a society want to happen so that's That's one thing and I remind people internally when you know if you don't take this personally that's going to guide you and a lot of energy will be wasted this is just normal , it's actually healthy, it's good, we want to live in a society where people care about big institutions, so that's fine and then the second thing I think is that we are so inventive that any regulation that is enacted or however it works It's not going to stop us from serving customers, so really, you know, I mean all kinds of regulatory frameworks that I imagine customers will still want low prices, they'll still want fast delivery, they'll still want a great selection and so these Things are so fundamental, those are the things we do, so I would say I would do it.

One more thing, while we're talking about big business, it's really important that politicians and others don't have to understand the value that big business brings and not demonize or vilify business in general or especially. I'm visiting, well, Big business shouldn't be vilified and business in general will surely be vilified and the reason is simple. There are certain things that only big companies can do. Know? I've seen this all the time. I know what Amazon could do when we were. 10 people and I know what we could do when we were a thousand people and I know we could do 10,000.

I know we can do today when we were half a million and you know, give you a more vivid examination. I love you, you know, garage entrepreneurs. I invest in many of their companies. I know a lot of them, but no one in their garage is going to build an all-carbon fiber, fuel-efficient Boeing 787. That's not going to happen. You need Boeing to do it. If you love your iPhone, you need Apple to do it. to do that you need Samsung to do that these are things you know a well-functioning corporate capitalism does those kinds of things very well and then there are market failures where no one takes care of that, you know it's you So you know you look towards philanthropy and towards the government, so you need different models for different things, but definitely this world would be really bad without Boeing, without Apple, without Samsung, etc., so one of your passions is not only Amazon but its outer space. and the yellow origin of space travel, so you started Blue Origin a little bit secretly and then you made it public.

You are investing a billion dollars or more of your own personal capital, yes, but every year next year it will be more for the first time okay and what you are going to get from this we are going to have people going to space what is the yes this This is the most important work I'm doing and I feel strongly about it. Is it a simple argument? This is the best planet. We have sent robotic probes to all the planets in this solar system. Trust me, this is the good one. My friends who say they want to move to Mars.

I tell them: look, do me a favor. Move to Mars. top of Mount Everest for a year first because it's a garden paradise compared to Mars and that's why we're finally this gem of a planet as a species big enough to really impact it and as you know, for thousands and thousands of years the Earth was really big and humanity was really small, that is no longer true, so we are faced with a choice as we move forward, we will have to decide if we want a stasis civilization, which we could do, that is real, that is a legitimate choice , what does it mean?

It means we're going to have to limit the population, we're going to have to limit the per capita energy use so people don't think about how much energy they use. Your metabolic rate as an animal uses about a hundred watts of energy, so use about the same amount of energy. like a 100 watt light bulb, but your civilization metabolic rate as a human being living in the developed world, now this is a figure for the developed world, it's over ten thousand watts of power, that's how much you're using when you know it , because you just continue with your life. all these lights and driving your cars and vehicles and flying all over the country and whatever you're doing that uses energy, it's using on average about 10,000 watts and in the less developed world the way they want to be where , a lot of energy will be used.Energy use has long been growing at a rate of a few percent a year, even as efficiency has grown very rapidly, so we know that we are always getting more efficient, and even though we are getting more efficient, we are still using more energy and that's a big part of the reason why energy is so fundamental, that's a big part of the reason we have the lifestyle we have as a modern civilization. a lot of energy and you also want that to continue for your grandchildren or your grandchildren's grandchildren;

In other words, I want my grandchildren's grandchildren to use much more energy per capita than I do and I would like it to not have a population limit. If there were a billion humans in the solar system, then there would be a thousand Einsteins and a thousand Mozarts, but we don't have that much time if you take the current baseline global energy use and add just a few percent a year for a few hundred . years, the power of the composition has to cover the entire surface of the earth and the solar cells, that is not going to happen, so we can be sure that that is not going to happen, what will that lead to that? will lead to stasis I don't even think stasis is compatible with freedom, so we are about to face all kinds of problems because for the first time in our history of civilization, which goes back thousands of years, we are now great compared to size. of the planet we can solve that problem, but we can solve it in exactly one way: by moving to the solar system and you know, my role in that is I want to build reusable space vehicles, that's Amazon's heavy lifting.

He was able to start with just a million dollars.in the capital and in and because I was able to ride on the back of the credit card system, I was able to ride on the back of the pre-existing transportation network that could deliver packages, the network pre-existing telecommunications infrastructure that could allow people to connect to our servers, all of that would have been hundreds of billions, meaning some capital expenditure, but the heavy lifting was already in place and that's what allowed Facebook, think about it, two kids in a bedroom created this half a trillion dollar market cap company and you know. in incredibly less than two decades, that's incredible, but that can't happen in space, there's no way two kids in a bedroom can start a major space company because the price of entry is too high and that's why I want build. space infrastructure so that the next generations of people can use that infrastructure the same way I use UPS and FedEx, etc. to build Amazon and that and that's what Blue Origin is all about, so ultimately do you want that to be your legacy? or Amazon and what would you like to have as your legacy?

The oldest man in the world. That's a famous quote that I like, but the real thing is that you know that whatever it is, I'll be proud of it. the things I want. I live my life in such a way that when I'm in a quiet moment of reflection and I'm thinking about my life, I regret it as much as possible and I don't know what my legacy will be whether I have no idea and I and I don't even want to spend a lot of time I think you intend to give away most of your fortune at some point in your life I tend to give away I don't know how much of it I'm going to give away and I'm also going to invest a large amount in Blue Origin so for me I start with the mission and I believe So far we have discovered three ways that if you have a mission you can accomplish it. with the government, you can do it with a nonprofit and you can do it with a for-profit organization, if you can figure out how to do it with a for-profit organization, that has many advantages for many reasons, one of them is self-sustaining , so you know we don't.

You don't need to know that here is my iPhone, the last thing we need is a company, a non-profit company that makes phones. It turns out that there is a healthy competitive ecosystem that likes to build these things. There are no market failures here if, like the Gates Foundation, you look at it. We know that vaccines at room temperature there is no market for vaccines at room temperature, anyone who can afford a vaccine can also afford a refrigerator, so we have to start solving problems like that that have no market solution and then get to other things like the judicial system and the military and so on, you can't even imagine a nonprofit model, so the real answer to your question is: I'm going to donate a lot of money in a nonprofit model, but I'm also going to investing a lot of money in something that any rational investor would say is a really bad investment, which is Blue Origin, but I think it's very important and if I can't make Blue Urchin a for-profit company, maybe I'll turn it into a non-profit organization, at some distant time. point in the future, but that would be what it would be I wouldn't want that I want it to be a thriving ecosystem to live a long time is to be healthy how do you stay fit?

I exercise, which I enjoy, so for me that's not a no. It's a problem and how do you handle wealth in regards to your children? I mean, how do you protect them from the effects of this enormous wealth? I don't really protect them, they're very, very mature, you know, kids are smart, they know it. What is happening with my oldest son when he was 12 years old? I asked him, you know? Do your classmates ever talk about her? I'm sure, so what did you tell them? I told him, I told them that my life is normal to me and I thought wow, that's so profound. because everyone's life is normal to them, we all have that, we all share that and when you took your oldest son to college this year you carried his books through the steps like everyone else, yes I helped him move into his dorm and with my wife. and it was bittersweet, it was also sad, I didn't get sad until the day before, well, let's break up with your wife, we haven't mentioned her, yes, he is a Princeton graduate, she is a novelist and she has supported everything you are doing and Would you like to say something else about her I was waiting for the question okay, we have been married 25 years she also graduated summa laude from Princeton we didn't meet there we met in New York City at Xiang Co where we worked we got engaged later that we got each other we dated for three months we were engaged for three months and then we got married so our whole kind of dating commitment period was only six months I would like to take a moment to talk about my parents too yeah okay, you didn't ask me, but hey, I wish they were here in the audience and my parents are.

I thank you, you know that you receive different gifts in life and one of the great gifts that I have is my mother and my father, it is incredible, my greatest admiration is retained by those people and we all know some of them. I know several who had terrible parents, maybe they were abusive, whatever, and some were those people who so admirably break that. cycle and go out and make it all work I didn't have that situation, I was always loved, my parents loved me unconditionally and by the way, it was quite difficult for them, you know, she doesn't talk about it a lot, but my mom.

She had me when she was 17, she was a high school student in Albuquerque, New Mexico, you could ask her, but I'm pretty sure it wasn't cool in 1964 to be a pregnant mother in high school in Albuquerque, New Mexico, and in fact , My grandfather, who is another incredibly important figure on my wall in my life, went to defend her and because the high school wanted to kick her out, they didn't allow you to be pregnant in high school there and my grandfather said you can't. kick her out, she's in a public school, she can go to school and they negotiated for a while and the principal finally said okay, she can stay and finish high school, but she can't do any extracurricular activities and she can't have a locker and I know and then, and my grandfather, who was a very wise man, said it was over, we'll take that deal and she finished high school, had me and then married my father, my father is my real father, not my biological father, his name.

It's Mike, he's a Cuban immigrant. I came here as part of Operation Pedro Pan and I was actually housed at a Catholic mission not far from here in Wilmington, Delaware, and then I got a scholarship to go to college and to Albuquerque, which is where he met my mom. , so I have a kind of fairy tale story and my grandfather possibly because I mean, I'm pretty sure because my parents were very young, from the age of 4, he would take me every summer to his ranch and it was the most spectacular since that he was old. Ages 4 to 16 Basically, I spent every summer working alongside him on the ranch.

He was the most ingenious man. He did all the veterinary work for him. He even made his own needles. He would hit the wire with an oxyacetylene torch and a drill. a small hole in it and sharpen it and make a suture like making a needle so you can suture the cattle and some of the cattle even survived and he was an extraordinary man and a big part of all our lives, but it's you who don't You don't realize, you know, you just look back and you know if you don't have these parents, you know it's very important so it's very important and for my grandfather to use like a second set of parents for me, Jeff, I want to I want to thank you for a very interesting conversation. and I want to offer you the first honorary membership and the Economic Club of Washington.

I hope he joins our

club

when he finally decides to spend more time here, as we hope he will. Would be pleased. To accept, they have some gifts for you. This is a copy of the original map of the District of Columbia designed by Pierre L'Enfant. We hope you accept it as a gift. We also have a leather-bound copy of the first one here. book ever sold on Amazon oh wow fluid concepts in creative analogies yes, douglas hofstadter's book you got it right, I'm glad and look at that, it's really great and courtesy of Ted Leonsis, one of the owners of maybe the Capitol signed by The Stanley Cup team is nice, so thanks for a great evening.

A great conversation. Thank you. He is a super interviewer. Thanks, yes.