In 2019: A Decade Following Amazon’s Acquisition of Zappos

By 2019, ten years had passed since Amazon’s purchase of Zappos, and the executives had exercised patience. As promised by Jeff Bezos, Amazon had largely allowed Zappos and its then CEO, Tony Hsieh, to operate independently. This unusual move signified Bezos’ endorsement of Tony. Amazon had even gleaned insights from Zappos’ management experiments and at one point brainstormed integrating elements of holacracy into their own divisions. Overall, they appeared supportive.

Despite this, Tony remained wary of what he and other Zappos executives referred to as “Amazon creep” — the growing involvement of the tech giant in Zappos’ affairs. Tony aimed to shield his employees from Amazon’s infamously aggressive work culture and layers of bureaucracy. To minimize contact, Tony and his team strategically reached out to Amazon only when absolutely necessary. However, even a simple inquiry could snowball into a conference call with several Amazon executives involved.

Tony reported directly to Jeff Wilke, the head of Amazon’s global consumer business at the time. Wilke, one of Bezos’ top lieutenants, was widely regarded as his successor and the second most influential figure at Amazon. Receiving an email from him could induce panic, especially when it concerned shipping defects. Wilke would sign off his emails with his initials, JAW.

Fortunately, Tony and Wilke maintained a strong relationship, with the latter appreciating Tony’s visionary approach to business management. Wilke tolerated the occasional antics that Tony would include in Zappos’ internal reports to Amazon. Tony often tried to avoid discussing mundane business metrics by filling updates with descriptions of the different management experiments taking place within the company.

Challenging Goals for Zappos: Profit and Expansion

Over the next two years, Wilke urged Zappos to achieve specific business objectives unrelated to its culture or management experiments. Tony needed to boost Zappos’ profits and expand its customer base. These were common goals across all autonomous units under Amazon’s wing. After a decade of belonging to the larger conglomerate, Zappos was expected to meet certain profit targets. It was now considered a “mature” company from Amazon’s perspective, but it was falling short. Although Zappos turned a profit, insiders claim they were only achieving about 30 percent of the prescribed targets, lacking a clear plan for improvement.

True to his nature, Tony sought creative solutions to meet these new business goals instead of merely increasing shoe sales. He began contemplating diversification into other sectors that could enhance Zappos’ efficiency and productivity, effectively saving money to make money. Tony was in search of the next big idea worth a billion dollars.

Hacking Sleep: Tony’s Unconventional Approach

To raise his productivity, Tony took an unconventional route by attempting to hack sleep. In essence, he drastically reduced the amount of sleep he obtained. He believed that rest should be measured in sleep cycles rather than hours. Tony calculated that within a seven-and-a-half-hour time frame, a person typically experiences five sleep cycles, each lasting around 90 minutes. As a workaround, he restricted his sleep to either six hours (four and a half sleep cycles) or four and a half hours (three sleep cycles) at night, complemented by a 20-minute nap in the afternoon or evening, equivalent to another sleep cycle.

In a 2019 interview with a blogger from WeWork, a shared office space company, Tony explained, “You’re tired, so you can go straight into REM sleep and kind of hack it that way.” This approach differed significantly from the recommendations of the Centers for Disease Control and Prevention, which suggest that adults should aim for at least seven hours of sleep per night. Tony even purchased the Oura smart ring — popular in Silicon Valley — to “optimize” his sleep. Concerned friends were granted access to the data, revealing that on some nights, Tony was only managing two or three hours of sleep, far below what is typically advised.