'Follow the Money' and Other Lessons From Jeff Bezos
My first reaction to the news that Amazon founder Jeff Bezos had bought The Washington Post was stunned silence. My second reaction was laughter after reading a tweet about what Bezos's personal Amazon page might be telling him today.
Overall, however, my reaction is one of optimism. I have a deep affinity for The Post. I was inspired as a middle schooler to get into journalism after reading a dog-eared copy of All the President's Men, and much later, I had the great experience of working with Bob Woodward and reporting for the paper from Iraq.
After thinking it through, here are five big takeaways on leadership from Jeff Bezos's decision to shell out $250 million for one of the country's most important news organizations.
In 1997, Bezos told Inc. magazine that he wasn't particularly concerned someone else might copy his idea for Amazon.com, in part because of his head start in building a brand.
"There's nothing about our model that can't be copied over time. But you know, McDonald's got copied. And it still built a huge, multibillion-dollar company. A lot of it comes down to the brand name. Brand names are more important online than they are in the physical world."
Sixteen years later, Amazon is one of the most recognizable brands on the planet.
For $250 million, Bezos could have created a heck of a news organization from scratch (and one that would not start out with decades of pensions payments, brick-and-mortar buildings, and the like). And yet he chose The Post. There might be many other reasons as well, but one of them has to the paper's reputation and history -- in other words, its brand.
You Can't Go It Alone.
The story of howThe Post broke Watergate is an excellent example of entrepreneurship, despite having little to do with building a business. If you read the history, it's clear that not one of the major players at the paper -- for example, then-publisher Katharine Graham, then-editor Ben Bradlee, and then-reporters Woodward and Carl Bernstein -- could have accomplished much without the others.
The same is true today. No true news organization can do much without great people. Based on Bezos's first communication withThe Post's staff, he gets that. His introductory remarks, in the form of an open memo, hit notes of "believable optimism," as the media blog Poynter.org put it:
"Bezos promises to honor the values of the Washington Post, to own up to mistakes, to 'slow down' in order to get it right, to be courageous in the pursuit of truth ...
"He does not say everyone will keep their jobs. But then, no one has promised that at The Post for a long time. What Bezos demonstrates is that an empty promise of continued employment does not create optimism--but a genuine promise to commit to important journalism can."
You Must Do It Alone.
That said, there's a good reason why most journalists seem to be optimistic about this development, and it's not the strength of a memo. It's the fact that Bezos has a track record of identifying game-changing ideas, and then making them actually happen.
In our book, Breakthrough Entrepreneurship, my co-author Jon Burgstone and I examined why the best leaders of innovative organizations act differently from most leaders of more established organizations. In short, innovation generally requires a kind of enlightened despotism:
"As an assertive-leader entrepreneur, you need to [be] obsessive when it comes to your vision, your focus, and your drive. You need to need to work long hours and get everyone to fall in line and support you. You often have to be determined to the point of obstinacy. You don't have time for lots of meetings and hand-wringing."
It seems to me that The Post, a 146-year-old newspaper, craves that kind of leadership. We'll find out how it's going to work, but for now, it's getting an owner who falls squarely in the innovative organizations-leader category.
Twenty years is a long time in any business, but especially in journalism. Consider for example, that The New York Times paid $1.1 billion for The Boston Globe in 1993, and 20 years later -- last week -- announced its sale for just $70 million.
Well, just last year, Bezos made this prediction about what the newspaper industry will look like in two decades:
"There is one thing I'm certain about: there won't be printed newspapers in twenty years. Maybe as luxury items in some hotels that want to offer them as an extravagant service. Printed papers won't be normal in twenty years."
(Hat tip to TechCrunch, which found and translated the quote from a German newspaper.)
Does anyone have a sense really of what the news business will look like in 2033? I don't know the answer, but I do know that in Bezos, The Post will have an owner with a deserved reputation for thinking long-term. Find me another newspaper owner who is interested in investing in space flight--or building a 10,000-year clock.
Follow the Money
The worst-kept secret about the news business (I mean real news, not entertainment disguised as news), is that it's never been a great business. There's a reason why most of the great newspapers in American have been run not by big media companies but by wealthy families.
While the $250 million Bezos is paying is not exactly chump change, it amounts to less than 1 percent of his total fortune. So, the Graham family's hope may be that instead of seeing The Post as an entity that always has to turn a financial profit, Bezos might want to use it so that his wealth can pay dividends in other ways.
During The Post's Watergate investigation, Woodward's secret source, FBI Deputy Director Mark Felt (known for decades as "Deep Throat") supposedly gave the young reporter some cryptic advice: "Follow the money." In choosing to sell to Bezos, the Graham family did exactly that.
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