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How Amazon Did (And Didn’t) Prepare Us To Be Startup Founders

Posted by Sandi Lin on November 9, 2015

The majority of our team most recently worked at Amazon.com before joining Skilljar, including myself and my co-founder Jason. We're frequently asked what skills we learned at Amazon that are transferable to startups. If you're wondering whether it's worth joining a large company when your long-term goal is really to become a startup founder, this post is for you.

Nothing prepares you for a startup except having done it before. This is probably why investors value previous startup experience so highly. Even then, there are many tactical aspects that change with time or don't have "right" answers, like what fundraising deal structures are in vogue, or when to hire a VP sales (there are already plenty of opinions you can read on these tactical topics). This post focuses on the macro themes of how Amazon did, and didn't, prepare us to be startup founders.

Startup founders

What Amazon Taught Us

  • Customer obsession - Amazon's mission is to be Earth's most customer-centric company. The customer experience is front and center of every discussion and decision. For example, shipping windows are referred to internally as "promises," and treated as seriously if broken. It's been a shock for us to realize that most companies actually aren't obsessed with their customers. The LMS industry is notorious for this problem - according to eLearningIndustry, 28% of companies left their LMS in 2015 because of lack of support. What we consider table stakes for a modern software solution (e.g. product actually works on common browsers/devices/operating systems, responding to tickets within 1 business day, API changes are backwards compatible) are revolutionary in this industry.
  • Written communication - Meetings at Amazon are centered around a six-page written document, written in a data-driven, white paper style. Meetings consist of reading the document in silence, then vigorous discussion. The process of producing an evidence-based written document forced us to learn how to clearly articulate and structure an extremely crisp and thoroughly researched narrative, and base decisions on customer experience and data. There is no fluff  – every sentence, word, and number in the six-pager will be scrutinized. This discipline and attention to detail is invaluable now in writing emails, proposals, and critically thinking through all aspects of a problem.
  • Hiring - Amazon has given extensive thought to the hiring process and runs it like a machine. As a former Bar Raiser whose approval is needed for every company hire, I also had the rare opportunity during training to shadow master interviewers and receive feedback on my own interview and debrief process. We've adopted several Amazonian hiring practices at Skilljar, including interview loops with assigned competencies, STAR and behavioral interviewing, written feedback in isolation, and running effective debriefs. Perhaps more importantly, we've interviewed hundreds of candidates in various disciplines and become comfortable with the recruiting and hiring process.
  • Website operations – Amazon is one of the most highly trafficked websites in the world. On the engineering side, Amazon taught us how to build things to scale, and also to run full-stack web operations like alarming, monitoring, and other developer necessities. Amazon engineers have to support their own applications, which requires much more knowledge and quality beyond simply writing code.
  • Executive presence – I've had the privilege of presenting to Jeff Bezos on at least five occasions over 3+ years, and many more times to senior VPs. I was far more nervous in those meetings than in any investor or customer pitch with Skilljar. Amazon has a very flat management structure which provides amazing opportunities to even entry-level MBAs. These experiences helped me learn how to communicate effectively with C-level executives at Fortune 1000 companies.
  • Network - Amazon's been invaluable in expanding our network of potential investors and employees. Not only did I meet my co-founder Jason there, at least five of our angel investors are Amazon executives, and many of our team members are either former Amazon co-workers, or close second degree connections within the company.
  • Brand - Amazon is a brand that all our customers know. Amazon is well respected for both technology excellence and customer experience. As a startup, we talk about these roots as the background how we run Skilljar today, which we believe provides more credibility to our product in customer conversations. In addition, it's likely helped me with introductions, as former Amazonians are known for tremendous ability to get stuff done, and are still relatively rare in the startup scene.

What Amazon Didn't Teach Us

  • Powerpoint – Amazon relies on written documents. The rest of the world uses Powerpoint and visual images. It's been difficult for me to structure stories around Powerpoint slides without the backdrop of a supporting and comprehensive narrative document. I sometimes find myself writing the narrative anyway, then trying to bubble it up into slides.
  • Storytelling – Amazon makes decisions based on customer experience and data. The process is structured to take emotions and subjective judgments out of the equation. But again, for the rest of the world, storytelling is a critical component of selling investors, customers, and potential team members. And the best stories are driven by emotion - not dry presentations of data. I've definitely felt my lack of storytelling experience in both written (Powerpoint) and verbal presentations.
  • Sales – While Amazon does have sales teams for many products (ads, payments, cloud services, etc.), lead generation typically already comes from within the Amazon family. For example, when we were starting Fulfillment by Amazon, we already had data on Amazon's 3P Marketplace sellers, what items they were stocking in which categories, and sell-through rates. The sales process is thus very different from a startup sales process, where we have no data and no leads. Even when starting a new category like Amazon Local, the Amazon name opens doors much more easily than a no-name startup.
  • Marketing – Similar to what happens with sales, most marketing at Amazon is about cross-selling the existing Amazon customer base with email and on-site merchandising, which is very different from how a startup thinks about marketing. Amazon does substantial paid search engine marketing and retargeting, but this was run through a central traffic team during my time there and not something that most Amazonians have exposure too. Startups, on the other hand, need to be constantly driving net new traffic, leads, and customers.
  • Modern technology tools – Amazon mostly uses internally-developed proprietary tools (some of which later turn into AWS products!) and has very strict information security policies for vendors. Most vendors are unwilling to modify their products to meet Amazon's rigorous IT standards, even with the potential to win a large account. As a result, technical and business teams have less exposure to modern solutions that make work easier and more productive. In contrast, startups must rely heavily on third party tools to get more done faster.

Conclusion

On balance, I'm grateful for my time at Amazon for providing a solid foundation for starting Skilljar. As the team grows, many of the skills I learned there are coming even more into play. The surprising thing I found in writing this post is - the list of what Amazon didn't teach us is almost exactly what I'd think a startup needs to succeed. Perhaps, through all the noise of fundraising hoopla and CAC/LTV metrics, it really comes back to the simple basics of making a fantastic product that customers really want.

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