Amazon - The Success Story of the Jeff Bezos-Founded Company

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Online shopping has become a part of daily life for most of us today. A recent survey in 2022 reveals that over 2.14 billion people worldwide shops online, which makes 27.6% of the people out of 7.74 billion people in the world. Thus, it can be concluded that more than one out of four people shops online now.  

While the number of e-commerce companies worldwide is growing fast, there are a few pioneer companies that have established themselves as the market leader in the sector, and one of them is Amazon.

Starting in the year 1994 from the founder Jeff Bezos' garage, Amazon is one of the few companies that joined the 1 trillion valuation club.

Let's have a look into the startup story of the e-commerce giant, Amazon along with it, discover Amazon's Revenue, Funding, History, Growth, Competitors and more.

Amazon – Company Highlights

Amazon - About
Amazon - Founder & Team
Amazon - Startup Story
Amazon - Name & Logo
Amazon - Growth & Revenue
Amazon - Funding & Investors
Amazon - Investments
Amazon - Acquisitions
Amazon - Business & Revenue Model
Amazon - Competitors
Amazon - Future Plans

Amazon - About

Amazon.com, Inc was launched in 1994 by Jeff Bezos in the United States. Later, it stepped into other countries to increase its market. Amazon India was started in June 2013, and sooner it became one of the biggest eCommerce platforms in India. Initially, the company started by selling books and it expanded to sell electronics, households, software, food, jewellery, and a lot more.

Currently, other than being an e-commerce company, Amazon has diversified into a number of domains including cloud computing, Publishing, on-demand music, video streaming, AI, consumer electronics, etc and the company is constantly on the lookout to enter new segments.

Amazon Studios, Amazon Publishing, Amazon Music, and Amazon Web Services are some of its other subsidiaries. In its bid to grow, Amazon has acquired over 100 companies to date.Apart from being the biggest E-Commerce platform, Amazon also offers some pretty exciting and good services and they are:

Amazon Web Services (AWS)

AWS is the web services platform of Amazon, which offers IT infrastructure services to businesses in the form of web services, which is commonly referred to as cloud computing. AWS was launched in 2006, and on March 2, 2021, it was selected by PGA TOUR as its official cloud provider.

Amazon Go

Amazon Go is a chain of convenience stores that is run under Amazon which was started in the year 2018. The stores are mainly present in the United States and the United Kingdom, the main concept of these stores is that there are no cashiers in the store with whom customers have to deal. Everything is automated there and they have self-checkout stations where customers can pay for their supplies after picking them up from the store. As of now, there are 42+ Amazon Go stores.

Amazon Prime

This is the OTT video streaming platform offered by Amazon, it is a subscription-based platform where movies, television series, web series, and other video content are provided for the audience to watch. Amazon Prime was launched worldwide in 2016, however, some countries were excluded then, like North Korea, Mainland China, Syria, Cuba, and Iran. Amazon Prime Video made history as the first streaming service to secure an Exclusive National Broadcast Package from the NFL on March 18, 2021.

"We recognize the need for in-game content by mobile gamers to enhance their playing experience and are delighted to provide access to this content free to Prime members. We will continue to add new in-game content for other popular games, with frequent content refreshes." - Akshay Sahi, Director and Head of Prime, Amazon India

Amazon Pay

This is the online payment processing service provided by Amazon. It was launched in the year 2007. Through this payment service, one can pay from their Amazon account, for goods and services. The payment service is supported by fraud protection technology through which you can complete any transaction securely. Amazon Pay launched Smart Stores on June 26, 2020. The Smart Stores of Amazon Pay is an India-specific programme that would enable the physical stores to serve the customers with a wide range of products that they can easily avail of and pay for just by scanning the QR codes.

"Amazon Pay is already accepted at millions of local shops, we are trying to make customers buying experience at local shops more convenient and safe through Smart Stores." -Mahendra Nerukar, Amazon Pay CEO

Smart Stores is also coming up with a feature in which a digital store will be available for the customers in which customers can go through the products that the shop is having, can read and update the reviews of the product, and avail many offers which can provide them benefits, and a new type of shopping experience. Many shops have signed up for Amazon Pay Smart Stores and came forward as they have found a new hope to bring their business back on track. Big brands such as Big Bazaar and MedPlus have come forward and have taken a part in this new initiative.

Smart Commerce Initiative

Amazon has announced its Smart Commerce initiative in India, as far as May 18, 2022 reports go. With this initiative, Amazon India has plans to transform the local stores into "Digital Dukaans". Amazon announced during the 3rd edition of Amazon Smbhav that the company will be fuelling its plans to digitise 1 crore small businesses by 2025 via the launch of its Smart Commerce.  

Amazon - Founder & Team

Jeff Bezos (Founder & Former CEO, Amazon)

Amazon was founded by Jeff Bezos (Jeffrey Preston Bezos) in 1994. He is an American entrepreneur and industrialist. After graduating from Princeton University with a degree in electrical engineering and computer science in 1986, Bezos worked for 'Fitel' ( a fintech telecommunication startup), where he was working on building a network for international trade. Later Bezos was promoted to head of development and director of customer service at 'Fitel'.

Jeff Bezos stepped down as CEO of Amazon and will be the executive chairman of Amazon. Andy Jassy -The Cloud Computing Chief has been appointed as the new CEO of Amazon.

Andy Jassy (Cloud Computing Chief & CEO of Amazon)

Jassy joined Amazon in 1997. He has an MBA from Harvard Business School. It was Andy Jassy who founded Amazon Web Services (AWS), a cloud platform with millions of users. Andy Jassy's promotion from being a Cloud Computing Chief to the CEO (Chief Executive Officer) of Amazon is remarkable and highlights the importance of web services to Amazon's future. Andy Jassy has taken over the position of Amazon CEO.

Amazon - Startup Story

Jeff Bezos jokingly describes founding Amazon as a 'Regret Minimization Framework'. Jeff did not want to regret not taking advantage of the internet boom that had then started to slowly take the world by storm. Hence in 1994, Jeff left his job as vice president of D.E Shaw & Co. to start his own venture.

Jeff Bezos wrote his company's first business plan on a cross-country drive from New York to Seattle. Initially, Amazon was registered as Cadabra, Inc. However, when Jeff found out that people misheard the name Cadabra as 'cadaver' (cadaver means corpse), he decided to change the name and bought the domain name relentless.com. But that too was changed as his friends did not quite like the name and finally named his company 'Amazon'.

Jeff listed 20 products that can be sold online, out of which he decided to start with selling books. The first to invest in Amazon was Jeff Bezos' parents, who invested $250,000 in the venture. By 1997, Amazon had 2.5 million titles.

In 1998, Amazon acquired Junglee Corporation ( provider of database technology to help consumers find products on the Internet) and 'Planet All' a social networking, calendaring, and address book site, and with it, the company also started expanding its offerings beyond books.

In 2005 Amazon also entered the crowd-sourcing business with 'Amazon Mechanical Turk'.

In 2006, Amazon entered the cloud computing sector with 'Amazon Web Services (AWS) realizing the great scope that the sector holds. In 2006, Amazon entered the video-on-demand sector with 'Amazon Unbox'.

In November 2007, Amazon released Kindle, its first e-reader, which became quite popular among users. In 2007, Amazon launched Amazon Music.

Another Amazon product that has gained popularity is 'Alexa', which is a virtual assistant AI technology developed by Amazon.

Amazon - Name & Logo

Amazon being the largest river in the world, the company was named 'Amazon' as Jeff Bezos envisioned his company to be the largest.

Amazon's current logo which the company has been using since the year 2000, has an arrow leading from A to Z, which reflects the company's goal to provide every product a customer needs. The arrow forms a smile, which represents customer satisfaction.

Amazon - Growth & Revenue

What started as a small online book store has become the world's largest online marketplace today. Ever since Amazon was launched, it simply grew from strength to strength. The company diversified and explored many horizons, and most importantly, it cemented its position regardless of where it went.    

Amazon India marketplace, which is run by Amazon Seller Services, has posted a 49% rise in its revenue from operations that have been recorded at Rs 16,200 crore during FY21 and was last recorded at Rs 10,847.6 crore. The eCommerce giant in India also witnessed a decrease in its losses, which declined from Rs 5849 crore to Rs 4748 crore. However, another unit of Amazon called Amazon Wholesale (India), has scaled down during FY21, posting a 7% drop in its revenue from operations, which decreased from Rs 3384 crore (FY20) to Rs 3131 crore (FY21).    

Looking at the sales, Amazon's sales also skyrocketed at an unimaginable pace, which has significantly contributed to the growth of the business. One another thing is the diversification of its products and the realization of the future of the online shopping and eCommerce businesses at an early stage, which helped Amazon scale leaps and bounds.

Amazon might get affected by tighter FDI Rules by the Indian government, as per reports dated February 27, 2021.

Amazon - Funding & Investors

Let's take a detailed look at the Amazon's funding history. The company has received a total funding amount of $108 million over two rounds. Amazon went public in 1997. Amazon is funded by 2 investors, AOL and Kleiner Perkins.

Investors

Amazon - Investments

Amazon invested in numerous organisations, keeping a track of which is really difficult if not impossible. The Bezos-founded company has over 118 investments to date.

The Andy Jassy-led company is looking to buy majority stakes in Ecom Express for $500-600 mn. Amazon doesn't own an in-house logistics and delivery system unlike its rival Flipkart, and to match the Walmart-backed company, Amazon is planning to own an ecommerce logistics and delivery unit. Though both Amazon and Ecom Express are in the preliminary stages of talks, the ecommerce behemoth will likely pick up 51% stakes in the latter, thereby leading Warburg Pincus to quit.            

Here we have managed to present to you some of the recent investments of Amazon. Check them out below:

Amazon - Acquisitions

Amazon has had a list of acquisitions since 1994 when it started. The tech giant boasts of 94+ acquisitions and counting. Here's a list of some of the prominent acquisitions that Amazon made recently:

Amazon - Business & Revenue Model

Amazon primarily runs an E-commerce business, which runs on an E-commerce business model. The company also has other wings, which run on an array of business models. Besides, Amazon also manufactures numerous products that are sold online and via retail stores across the world.  

Amazon Customer Segment

Amazon customers can be divided into:

• Sellers - They sell their products to a wide audience using the Amazon platform.
• Buyers - They buy from a wide selection of Amazon products and services.
• Developers - There are numerous communities involved with the Amazon Web Services (AWS), which include both Amazon customers, partners, businesses, and individuals.        

Amazon Value Proposition

The business model of the company, as per the founder of Amazon, Jeff Bezos, depends on 3 value propositions:

• Low price
• Fast delivery
• Wide selection of products

Amazon Channels

The most important channel of Amazon is the Amazon website itself. Some other notable channels of Amazon include Amazon Prime, the Amazon app, and more.

A major portion of Amazon's revenue comes from its E-commerce business. Besides, Amazon also has 526+ brick and mortar retail outlets, which forms a good source of revenue.

It also makes a huge revenue through Kindle, an electronic device to read books, subscription fee of ‘Amazon Prime’, third-party seller services, advertising revenues, and revenue from Amazon Web Services.

Here are the prominent revenue channels of Amazon:

• Sales for one-time
• Sales commissions
• Advertising
• Subscriptions like that of Amazon Prime and the app itself
• Web Services (AWS)
• Licenses
• Patents
• Pay-Per-Use and Support Subscription

Amazon - Competitors

Amazon has a lot of competitors in segments such as merchandise, web services, electronics, and media. some of the main competitors of Amazon in its different fields.

• Flipkart
• eBay
• Netflix
• Google
• Microsoft
• Alibaba Group
• Apple
• Oracle

Amazon - Future Plans

Amazon plans to expand in the areas of Machine Learning, Home Automation, Robotics, and Space Exploration (termed 'MARS').

Amazon is planning to venture into the health-tech and food delivery business soon. Amazon CEO Jeff Bezos has revealed plans to introduce 'Amazon Prime Air Drone Delivery Service', whereby lighter packages will be delivered to customers through drones. The company is also making efforts to make its delivery system more eco-friendly, by including electric vehicles in its delivery services.

Regarding Amazon's plan in India, the company is planning to create 1 million new jobs in India by 2025. In January 2020, Jeff Bezos announced that Amazon will invest $1 billion in India to help 10 million traders and MSMEs businesses in India to go online. The company is envisioning to enable exports worth $10 billion via Amazon by 2025.

Amazon has announced to facilitate $20 billion worth of exports of Indian goods in the next 3 years, as per Amazon Exports Digest 2022. On average, it makes the company exported Indian goods would have to be $2 billion a year since 2015.    

FAQs

What is Amazon's Funding History?

Amazon received a total funding of $108 million over two rounds. Amazon went public in 1997.

When was Amazon Founded in India?

Amazon launched its operations in India in June 2013. Amazon was founded in July 1994.

Who is Amazon's CEO?

Andy Jassy is the CEO of Amazon. Jeff Bezos was the former CEO of Amazon.

How much is Amazon's Revenue?

Amazon India marketplace posted Rs 16,200 crore as its revenue from operations in FY21, which was a 49% increase from Rs 10,847.6, which it saw in FY20. On the other hand, the Amazon Wholesale business of India has witnessed a 7% drop in its operational revenue, which was recorded at Rs 3384 crore in FY20 and became Rs 3131 crore during FY21.  

What are Amazon's keys to success?

A huge number of SKUs, Table of Contents, Free Shipping and Returns, Overnight Delivery, Incredible Customer Service, and Talented Management is the Amazon's keys to success.

How long did it take Amazon to make a profit?

It took Amazon more than 14 years—58 quarters after its initial public offering to make, as much profit as it produced in the latest quarter.

What is Amazon's launch year?

Amazon was launched in 1994.

Who is the founder of Amazon?

The founder of Amazon is Jeff Bezos, who is also known as the creator of Amazon.