Amazon’s board once demanded that Jeff Bezos stop driving his ageing Honda Accord and hire a professional driver, so letting him blast off into space was out of the question.
Later this month, the world’s richest man is due to travel into orbit, on the first human flight operated by his space travel company, Blue Origin.
The trip will fulfill a lifelong ambition for the renowned Trekkie, but was never likely to be countenanced while Bezos was still running one of the world’s most valuable companies.
On Monday, 15 days before the flight, Bezos will step down as Amazon’s chief executive, 27 years to the day after founding the company in Seattle.
He will be replaced by Andy Jassy, 53, currently the head of Amazon’s giant cloud computing division, and a veteran of the company whose rise has closely followed that of Bezos.
Like the retail empire that Bezos fostered, Jassy cultivated Amazon Web Services from a fledgling project into a behemoth that now brings in most of the company’s profits.
Founded as an internal effort to unite Amazon’s disparate IT systems, in 2006 the company started renting out server space and software to other companies over the internet. The division has led the cloud computing revolution, with customers ranging from Netflix to the NHS and Nasa.
Jassy’s long tenure at Amazon, and his track record, meant that investors shrugged in February when the company announced that Bezos would be moving to an executive chairman role.
Amazon’s share price soared under Jeff Bezos
Shares barely moved, and Wall Street analysts on the investor conference call took six questions to bring up Bezos’ move.
But insiders say the handover comes at a potential turning point for Amazon, as it faces a bombardment of regulatory scrutiny, complaints from merchants that sell on the service, and growing competition.
“They are facing huge hostility and they need to do something. Changing the CEO at this time is a signal to say ‘we’re not going to continue as usual, we’re going to try to address these issues’,” says Thomas Roulet of the Judge Business School at Cambridge University.
In contrast to Bezos, whose $200bn (£145bn) fortune, space investments, ownership of the Washington Post newspaper and celebrity parties have made him an easy target, Jassy has kept a relatively low profile.
His career at Amazon has given him a stake worth $300m, but he lives in a relatively modest Seattle house bought in 2009. A sports fanatic, his most high-profile expense has been an investment in the Seattle Kraken ice hockey team. While Bezos studied engineering, Jassy’s Harvard degree was in politics.
Andy Jassy was the first employee to become Bezos’ technical advisor or “shadow”, a now mythical consigliere role at Amazon that involved joining the chief executive at every meeting and gave him unparalleled access to Bezos
Credit: David Paul Morris/Bloomberg
“He’s a really bright guy, but he’s not really a shiny guy. He’s good at what he does and he does it quietly,” says Jon Reily, a former Amazon executive
Although Bezos is not retiring, his move to an executive chairman role could be seen as an attempt to make Amazon less of a lightning rod as critics queue up.
Investigations and attacks on the company are mounting. In May, prosecutors in the US District of Columbia filed charges against the company, claiming it raised prices by banning merchants from selling at cheaper prices elsewhere.
The European Commission has accused it of abusing its access to sellers’ data to boost its own sales, and is investigating the company on other grounds.
Lina Khan, the new head of America’s Federal Trade Commission, shot to prominence for writing a paper called Amazon’s antitrust paradox, which argued the company may be abusing its power even if it leads to lower prices for consumers.
New Federal Trade Commission head Lina Khan is known for her critical stance towards Amazon
Credit: Saul Loeb/Pool via AP
Her appointment distressed Amazon’s lobbyists so much that last week they wrote to the regulator asking that Khan be recused from all cases involving the company, suggesting she would not be impartial. Bezos, who struggled through a Congressional committee grilling alongside his counterparts at Apple, Google and Facebook last year, will be happy to pass on the responsibility to Jassy.
“It’s a lot easier to gain support if it’s not perceived to be Bezos versus Congress,” says Neil Campling, an analyst at Mirabaud Securities, who says Google, Apple and Microsoft have also benefited by replacing their founders with less flashy leaders.
Jassy has had his own political scraps. After Microsoft beat Amazon to a giant military contract, his cloud division sued the government, claiming political bias.
He was also behind the controversial decision to take the social network Parler offline, after rioters stormed the US Capitol building as Members of Congress voted on Joe Biden’s election victory.
Repairing Amazon’s image is seen as crucial to ensuring a steady flow of talented engineers, as well as warehouse workers. The company has been hit by multiple protests among both white collar and blue collar staff over pay, the company’s handling of Covid-19 outbreaks and its environmental impact. “The question is ‘Is Amazon good for society?’ I think Jassy’s going to try to change that narrative quite quickly,” says Roulet.
Investors might be more concerned about whether Jassy can continue Amazon’s inventive streak. While Bezos has delegated much of the company’s day-to-day operations in recent years, he has kept close to new initiatives.
Top companies in the world by market capitalisation
Simon Murdoch, a venture capitalist who ran Amazon’s European operation in the late 1990s, says that Bezos would obsess over inventions, handing out “Just Do It” prizes – in the form of old Nike trainers – to those who had come up with a more efficient way to do something. Bezos has said this will continue as chairman.
“He has somebody that he can really trust to run the business day to day. I’m sure what Jeff will do is focus on how he can help as a visionary.”
Jassy recently sought to reassure staff, insisting that the company would maintain an “insurgent mindset” that would keep innovating. But Amazon’s new boss might have to fight his own nature to keep the pledge.
“Andy is a pragmatist,” says Reily. “Jeff was willing to make leaps on things that look like they won’t work, with a gut feeling that they would. Andy would say ‘let’s test and learn and see if we can get more information’.”
There is little chance of Bezos going away. In his closely watched annual letter to shareholders – a tradition he is likely to continue as chairman – he said he would focus on making the company “Earth’s best employer”, a pledge that somebody on their way out would be unlikely to make.
Bezos added that it would remain “Day 1”, referring to his philosophy of remaining paranoid about competition and constantly reinventing itself. Twenty-seven years after the company’s original day one, Bezos’s successor will not find it easy to stick to that promise.