5 Takeaways from the Rise and Fall of Zappos CEO Tony Hsieh

Ren D

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Tony Hsieh lived an extraordinary life. Born in Illinois to Taiwanese immigrants, he moved to California as a young child. In 1995, he graduated from Harvard with a degree in Computer Science. Just a year later, he launched LinkExchange, an advertising network. Two years later, the site had 400,000 members and 5 million ads. He sold LinkExhange to Microsoft for $265 million in 1998[1].

Clearly, he was a passionate individual constantly looking for the next idea. A year after selling LinkExchange, he was approached by Nick Swinmum, with the idea of Zappos – an online business to sell shoes. While hesitant, Hsieh eventually decided to invest and became CEO of Zappos.

Tony took customer and employee satisfaction to the next level. He’d answer customer requests himself, he changed Zapoos structure to remove job titles because of his belief in his employees. His desk as CEO was like all other desks in the office.

Eventually, Tony moved the company to Henderson, Nevada. While in Nevada, he started a downtown project to re-develop downtown Las Vegas. The idea started with having a place for Zappos employees to live and work but grew to attract other tech businesses and entrepreneurs.

In July of 2009, Amazon acquired Zappos for $1.2 billion. Tony stayed on as CEO and retired last August. That’s when his fall began.

Just as he did in his professional life, Tony exhibited extraordinary behavior In his personal life. He often experimented with extremes on himself, including oxygen deprivation and extreme fasting.

After retiring as CEO of Zappos in August of 2020, he bought multiple properties in Park City, Utah. He paid local people to work for him on those projects. This became his inner circle.

One can surmise that the loneliness of Covid had something to do with his death. Being an internet entrepreneur, Tony was used to engaging with people. After his retirement, he didn’t have the same social circle. He was left alone to his extreme experimentation. This resulted in his eventual death.

Last November, Tony died of smoke inhalation. He was in the basement of a 3-story shed in New London, Connecticut. The cause of the fire isn’t known but he was rescued by firefighters and later died in the hospital from smoke inhalation. He did use drugs and nitrous oxide. Those two factors likely played a role in his death.

With or without the pandemic, we know the state of our loved ones. We know when they are in trouble. Two weeks before his death, the singer Jewel wrote him a letter advising him of the danger he was in. The people he surrounded himself with in Park City seemed to only see him as a means for financial aid. No one helped him.

There are lessons we all can learn from this troubled visionary.

1. Contribute to the greater good.

Tony saw the move to downtown Las Vegas as a way to revitalize the community. That was his plan for moving Zappos. Once there, the area began to attract other tech companies and startups which changed it for the better.

In his book, Delivering Happiness, Tony explains how to build a business with profit, passion and purpose. He speaks of building a lifestyle to deliver happiness to everyone. His book, his businesses and his life, were about delivering happiness and contributing to the greater good of society. If you read the reviews of the Zappos tours, or reviews on Glassdoor, you'll see that Tony's focus on employee happiness was evident.

2. Surround yourself with people who care about you.

From August 2020 to his death in November, Tony surrounded himself with those that he paid as part of his Park City project. He was buying property left and right and purchased a $15 million dollar mansion for himself. One would assume that he was finally living the fruits of his labor but he continued to be philanthropic, giving $10,000 to each local restaurant for future meals. The people he helped clearly didn’t care about him personally.

When you see someone you care heading in a downward spiral, you let them know. You reach out and check in on him. You show up and help. By surrounding himself with people who saw him as a paycheck, he had no one who cared about his wellbeing. He was left to fight his demons by himself.

3. Surround yourself with people who give you feedback.

As Tony paid people to work for him and surround himself with in Park City, they became yes men. They witnessed his strange behavior and did nothing about it. They didn’t challenge what he said. They saw him struggling with addiction but continued to ignore his behavior.

Surround yourself with people that will tell you when you’re full of shit. If your relationship is too easy, there’s probably something wrong. People who love you will challenge you. They will tell you when you’re on the wrong path.

4. Keep escapes temporary.

We all need to escape from life every once in a while. We spend our days in front of computers. We spend our days working, cooking, home schooling and cleaning. We need to escape our reality for our mental well being. The escape can be a hike, or bike ride, or swim. It can be a drink or marijuana. Whatever the escape is, it needs to be kept it to a minimum. You can’t live your live in an escape. You must return to reality.

5. Take the time to understand yourself.

Being that Tony was such a visionary, he should have been acutely aware of his constant need to innovate. This need unfortunately lead him to his fall. After retiring from Zappos, there wasn’t much left for him to accomplish. He was extremely financially successful yet lacked fulfillment. The extreme personal experiments demonstrated his need to innovate. He was clearly looking for something. Had he been aware of this need, he could have focused his energy elsewhere.

In Summary

We can learn from the life of Tony Hsieh. There are few people in this world who are visionaries with the desire to give back to communities. While at Zappos, Tony was known for being customer focused while maintaining employee satisfaction. His Linked In is full of recommendations from people commenting on the culture he built at Zappos, his innate ability to respond to requests quickly, and his ability be a team player by speaking to everyone regardless of company stature. Levels didn’t matter to him.

People like Tony are hard to find. It’s a shame such a bright, successful, likeable individual had demons he couldn’t control. It’s a shame no one thought to step in and help him.

All we can do is learn from him. Learn from the contributions he made during his rise, and what contributed to his fall.

[1] https://en.wikipedia.org/wiki/Tony_Hsieh

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On a journey to find fulfillment. I write about personal growth and development, love, minimalism and life lessons.

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