Jeff Bezos and the Amazon Garage

The regret test

In 1994 Jeff Bezos was a senior vice president at the hedge fund D. E. Shaw in New York when he came across a startling figure: web usage was growing at a pace of thousands of percent a year. He decided to start an online store and picked books, because there were millions of titles, far more than any physical store could hold.

Leaving a well-paid job was risky. Bezos has said he used what he called a regret minimization framework: imagining himself at 80 and asking which choice he would regret more. Not trying won.

Road trip and a garage

Bezos and his then wife, MacKenzie, drove from Texas to the Seattle area while he worked on the business plan. Seattle offered tech talent and proximity to a major book distributor. They rented a house in Bellevue, Washington, and set up shop in the garage, incorporating on July 5, 1994. The company was first called Cadabra before becoming Amazon, named after the world's largest river by volume.

Early desks were made from cheap wooden doors, a habit that became a company symbol of frugality. Bezos's parents invested a large portion of their savings to help get the company off the ground.

From books to everything

Amazon.com opened to the public in July 1995 and was shipping to every US state and dozens of countries within its first month. It went public in May 1997 at $18 a share. For years the company reported little or no profit as it poured money into warehouses, new product categories and services, a strategy many critics doubted.

Later bets, including the Prime membership program and Amazon Web Services, turned out to be enormous. Bezos handed the CEO role to Andy Jassy in July 2021 and became executive chairman.

Early Amazon also experimented with features that customers now take for granted, such as user reviews and personalized recommendations. Some people inside the publishing world worried that negative reviews would hurt sales, but Bezos argued that helping customers decide was the whole point.

The boss lesson

Bezos picked a starting product that fit the new technology perfectly, then expanded once the systems were in place. Starting narrow made the first version manageable.

He also played a long game, reinvesting cash flow into growth instead of chasing short-term profit. That approach is not right for every business, but it shows how patience and a clear long-term goal can shape every decision.

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