Jeff Bezos’ decision to buy the Washington Post isn’t so surprising given that he has long seen the value of making money slowly. The Amazon.com founder and CEO built his $61.1 billion-a-year business by plowing short-term profits back into the business, restless investors be damned.
Way back in 1999, actually, Bezos displayed an interest in old-line industries. He was at Allen & Co.’s conference in Sun Valley, Idaho when he heard Warren Buffett — the Washington Post Co.’s largest outside shareholder — warn that transforming industries often fail to reward investors over time. I wrote the following in Fortune in 1999:
Bezos was so intrigued by Buffett’s talk…that he asked Buffett for his lists of the automakers and aircraft manufacturers that didn’t make it. “When new industries become phenomenons, a lot of investors bet on the wrong companies,” Bezos says. Referring to Buffett’s 70-page catalog of mostly dead car and truck makes, he adds, “I noticed that decades ago, it was de rigueur to use ‘Motors’ in the name, just as everybody uses ‘dot-com’ today. I thought, Wow, the parallel is interesting.
A former hedge fund manager, Bezos is also a history buff fascinated by the Cambrian explosion about 550 million years ago, when multi-celled life spawned unprecedented variation of species — and with it, a wave of extinctions. Buffett’s analogies about bankrupt businesses “resonate deeply,” Bezos told me in 1999. That Buffett-infused paranoia has led Bezos to advise Amazon employees to stay humble. “We still have the opportunity to be a footnote in the e-commerce industry,” he said in 1999.
Fast-forward 14 years to the Amazon boss’s newest heady challenge. Bezos said in a statement yesterday: “The Internet is transforming almost every element of the news business: shortening news cycles, eroding long-reliable revenue sources, and enabling new kinds of competition…. There is no map, and charting a path ahead will not be easy.”
So now he is betting $250 million of his personal wealth that The Washington Post will be a survivor in another transforming industry.
