Who is Tony Hsieh?

I read the LA Times business section almost everyday. Ever since the economy fell off, the business section has been very depressing. All you hear about are stock droppings, bankruptcy's, and government bailouts. A business book I read said not to watch or read the news everyday because it's a downer. It's hard to avoid the news because you need to stay in tune with your surroundings. This Zappos sale caught my eye.

Tony Hsieh is the co-founder and CEO of Zappos. If you haven't heard of Zappos, they are the biggest online shoe retailer. In 2008, Zappos hit the $1 billion sales mark. That is huge! On July 22nd, Amazon acquired Zappos for a deal worth more than $807 million.

I read a few articles and listened to a few keynotes by Tony. He's a 34 year-old Taiwanese native that went to college in Harvard. During his college years he opened a pizza parlor. After college, he and his business partner at the time started a company called LinkExchange (an advertising network), which was later sold to Microsoft for $265M in 1998. He had about 100 employees at that time. After the buy-out, Tony started an investment firm called Venture Frogs who invested in internet start ups like Ask Jeeves and Zappos.

After getting bored just being an investor, Tony decided to get more involved with Zappos. He was not the pioneer behind Zappos but brought a lot of his ideas to the table. What makes Zappos successful is the company culture. They definitely take care of their employees and make an emphasis on team work. Second is customer service. They don't necessarily have the best price, but their staff and consumer relationship is spectacular. Most of their orders are from previous customers and referrals.

This is actually quite a funny and smart story... So when Tony had his pizza joint, one of his customers would buy a large pizza every day. Some days he would even buy two. Later Tony found out that his customer (Alfred Lin) was buying the pizza's and reselling it upstairs at the dorms by the slice. That is how Alfred became the COO of Zappos.

One of my friends sells his products through Zappos. He was telling me that their Kentucky warehouse was all automated including the picking. Instead of manually picking items, they use robots and conveyor belts. Most warehouses hire people to pick orders by hand. Zappos gives daily tours of their office at the Las Vegas headquarters. You can even meet Tony himself. Just email Tony (tony@zappos.com) to schedule a pick-up and tour.

Zappos also has a close-out and discount store called 6pm.com. I am sure you have seen this site on deal sites like slickdeals.net or even fatwallet.com. CHEAP! CHEAP! CHEAP!

Fun Fact: Their hiring is a two-step process. The first part is your basic interview. If you pass the interview, they make you take the company culture compatibility test. If you pass both, they offer you $2,000 to quit. You can either take the money and leave, or have a new job. That is a pretty good way to gain valued employees. I can see how it can back fire once in a blue moon but on the long run it is a definite gain.