Whenever high-end business people step down from a company or someone takes their place, there's always a bit of uncertainty associated with the transition.
Panic sellers offloaded their Microsoft stock after Bill Gates stepped down, One Direction fans panicked after Zayn said deuces to the group, and Amazon investors must've felt pretty uneasy when Jeff Bezos stepped down as CEO of the company. But is he leaving leaving the business?
Is Jeff Bezos leaving Amazon? Nope, he's just no longer its CEO, and his successor is Andy Jassy.
The story of Amazon and how it's entirely changed the way we shop is a 27-year-long tale that all begins in 1995. Jeff Bezos, son to Cuban immigrants, had an idea to launch an online bookstore out of the garage from his rented home in Bellevue, Wash. It was an idea that fulfilled an immediate niche that had a broad user base of customers: students and avid readers.
Many people had tons of old books lying around, usually expensive textbooks. And there were tons of readers who had titles they knew they'd never read again in a million years just gathering dust in their homes. Amazon provided a place where private sellers, along with retailers, could ship books out to people all over America. It was a business plan that was brilliant: Books didn't spoil in the mail and they were relatively easy to pack and ship out.
The company soon transmogrified into expanding its services and Amazon grew and grew and grew, but it wasn't until Amazon Prime launched in 2005 that things really began to take off. The allure of two-day shipping on pretty much any item, or a version of it for the low-low price of $80 a year was way too enticing for some users to pass up. Then came Prime Video, Music, and a slew of other services.
But there's another key to Amazon's success that doesn't get looked at enough, and that's Amazon Web Services, or AWS. If you've ever read a news story, browsed a product catalog, or watched an online training video, you may have noticed "AWS" somewhere in the URL. That means it's hosted on an Amazon server. This is a little known fact, but a whopping 40 percent of the internet's content is hosted on AWS.
Andy Jassy was the Chief Executive of AWS. Now he's Amazon's CEO and Jeff Bezos will be an executive chairman.
While Jeff Bezos launched Amazon and is currently the world's richest man (he was briefly dethroned by Elon Musk when Tesla company shares skyrocketed), Andy Jassy was put in charge of arguably Amazon's biggest moneymaker that few people know about.
In a memo to his employees, Bezos wrote that transitioning to his new role as Executive Chair will afford him "the time and energy I need to focus on the Day 1 Fund, the Bezos Earth Fund, Blue Origin, The Washington Post, and my other passions."
Interestingly enough, Amazon's stock prices didn't falter in light of the news; they actually rose 1.5%. The company's valuation is also at an obscenely high $1.7 trillion valuation.
So Bezos isn't leaving Amazon for good, in fact, Brian Olsavsky, the company's CFO has said, "I will reiterate [Jeff Bezos] is not leaving. He's going to be executive chairman, super important role, super active in the Amazon success story."
Jassy joined Amazon in 1997 and started Amazon's cloud services business from scratch, which started as a modest addition to the company's online sales department, but then soon accounted for 60% of the company's business. At its current valuation, it can be said Jassy is responsible for generating $1.02 trillion of Amazon's valuation. Whoa.
Why is Jeff Bezos stepping down as CEO?
Some folks have speculated that Bezos' decision to step down may have more to do with last year's meeting with the House Judiciary Committee to discuss antitrust laws and as NBC News puts it, "questions about the company's competitive practices, including accusations of pricing out competitors on its platform and using third-party seller data to inform the sale of its own products."
In his memo to employees, Bezos also wrote about the effect he hopes his philanthropic endeavors will have: "I’m super passionate about the impact I think these organizations can have."