AFTER GRADUATING FROM Princeton, I went to New York City and ended up working at a quantitative hedge fund, D. E. Shaw and Co., run by David Shaw. There were only thirty people at the company when I started and about three hundred when I left. David is one of the most brilliant people I’ve ever met. I learned so much from him and used a lot of his ideas and principles on things like HR and recruiting and what kind of people to hire when I started Amazon.

In 1994 very, very few people had heard of the internet. It was used at that time mostly by scientists and physicists. We used it a little bit at D. E. Shaw for some things but not much, and I came across the fact that the web—the World Wide Web—was growing at something like 2,300 percent a year. Anything growing that fast, even if it’s baseline usage today is tiny, is going to be big. I concluded that I should come up with a business idea based on the internet and then let the internet grow around it and keep working to improve it. So I made a list of products I might sell online. I started ranking them, and I picked books because books are super unusual in one respect: there are more items in the book category than in any other category. There are three million different books in print around the world at any given time. The biggest bookstores had only 150,000 titles. So the founding idea of Amazon was to build a universal selection of books in print. That’s what I did: I hired a small team, and we built the software. I moved to Seattle because the largest book warehouse in the world at that time was nearby in a town called Roseberg, Oregon, and also because of the recruiting pool available from Microsoft.

When I told my boss, David Shaw, that I was going to do this thing, I went on a long walk with him in Central Park, and he said finally, after a lot of listening, “You know what, Jeff, this is a really good idea. I think you’re onto a good idea here, but this would be a better idea for somebody who didn’t already have a good job.” That actually made so much sense to me, and he convinced me to think about it for two days before making a final decision. It was one of those decisions that I made with my heart and not my head, not wanting to pass up a great opportunity. When I’m eighty, I want to have minimized the number of regrets that I have in my life, and most of our regrets are acts of omission, things we didn’t try, the path untraveled. Those are the things that haunt us.

At first I had to go deliver the books to the post office myself. I don’t still deliver, but I was doing that for years. In the first month I was packing boxes on my hands and knees on the hard cement floors. I said to the person kneeling next to me, “You know, we need kneepads because this is killing my knees,” and he said, “What we need are packing tables”—the most brilliant idea I’d ever heard. The next day I went and bought packing tables and doubled our productivity.

The name Amazon comes from Earth’s biggest river, a reference to “Earth’s biggest selection.” The first name was Cadabra. When I was driving to Seattle, I wanted to hit the ground running. I wanted to have a company incorporated and have a bank account set up. I called a friend, and he recommended his lawyer, who was actually his divorce attorney. But he incorporated the company for me, set up bank accounts, and said, “I need to know what name you want the company to have for the incorporation papers.” Over the phone I said, “Cadabra”—like “abracadabra.” And he responded, “Cadaver?” And I said, “Okay, that’s not going to work, but go ahead with Cadabra for now and I’ll change it.” And so, around three months later, I changed it to Amazon.

After books we started selling music and then videos. Then I got smart and emailed a thousand randomly selected customers and asked them, besides the things we already sold, what would they like to see us sell. And that answer came back incredibly long-tailed. They answered the question with whatever they were looking for at that moment. So I remember one of the answers was “I wish you sold windshield wiper blades because I really need windshield wiper blades.” I thought to myself, “We can sell anything this way.” So then we launched electronics and toys and, over time, many other categories.

At the pinnacle of the internet bubble our stock peaked somewhere around $113, and then after the internet bubble burst, in less than a year our stock went down to $6. My annual shareholder letter for 2000, as noted in Part I, starts with a one-word sentence: “Ouch.”

That whole period is very interesting because the stock is not the company, and the company is not the stock, and so, as I watched the stock fall from $113 to $6, I was also watching all of our internal business metrics—number of customers, profit per unit, defects—everything you can imagine (see the 2000 letter for details). Every single thing about the business was getting better and fast. And so, as the stock price was going the wrong way, everything inside the company was going the right way, and we didn’t need to go back to the capital markets. We already had the money we needed, so we just needed to continue to progress.

During that era I was on television with Tom Brokaw. He pulled together half a dozen internet entrepreneurs from that era and was interviewing all of us. Tom is now one of my good friends, but at the time he turned to me and said, “Mr. Bezos, can you even spell profit?” And I said, “Sure, P-R-O-P-H-E-T,” and he burst out laughing. People always accused us of selling dollar bills for ninety cents, and I said, “Look, anybody can do that and grow revenues.” That’s not what we were doing. We always had positive gross margins. It’s a fixed-cost business, and so I could see from the internal metrics that, at a certain volume level, we would cover our fixed costs, and the company would be profitable.