Corporate Strategy | Alessandro Perilli

As a senior executive, what do you really get paid to do?

peris — Fri, 29 Mar 2024 11:38:37 +0000

I need eight hours of sleep. I think better. I have more energy. My mood is better, all these things.

And think about it.

As a senior executive, what do you really get paid to do?

As a senior executive, you get paid to make a small number of high quality decisions. Your job is not to make thousands of decisions every day.

So let’s say that I slept six hours a day. Or let’s go really crazy and say I slept four hours a day.

So now I just got four so-called productive hours back. So if I was going to have, say, 12 hours of productive time during any waking day, now all of a sudden I have 12 plus 4. I have 16 productive hours.

So I have 33% more time to make decisions. So if I was going to make 100 decisions, now I can make 133 decisions.
By the way, if I did that arithmetic wrong, I’m sorry. And so you make 133 decisions.

Is that really worth it if the quality of those decisions might be lower because you’re tired or grouchy or any number of things?

Now, it’s different if it’s a startup company…But Amazon’s not a startup company.

And all of our senior executives operate the same way I do. They work in the future. They live in the future.
None of the people who report to me should really be focused on the current quarter.

I always tell people, sometimes we’ll have a good quarterly conference call or something, and Wall Street will like our quarterly results.

And people will stop me and say, congratulations on your quarter. And I say, thank you. But what I’m really thinking is that quarter was baked three years ago.

Right now, I’m working on a quarter that’s going to reveal itself in 2021 sometime. And that’s what you need to be doing.
You need to be out two or three years in advance.

And then, why do I need to make 100 decisions a day?
If I make three good decisions a day, that’s enough.And they should just be as high quality as I can make them.

Warren Buffett says he’s good if he makes three good decisions a year. And so I really believe that.

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“Next quarter for all practical purposes is done already and it has probably been done for a couple of years”

peris — Mon, 04 Jul 2022 15:26:04 +0000

In a talk at the Internet Association’s annual gala last week, Bezos was talking about what makes his e-commerce and cloud company tick. As well as being customer focused, the CEO also said that the company is “long-term oriented”.

“I ask everybody to not think in two-to-three-year time frames, but to think in five-to-seven-year time frames,” Bezos told an audience in Washington, D.C.

“When somebody … congratulates Amazon on a good quarter … I say thank you. But what I’m thinking to myself is … those quarterly results were actually pretty much fully baked about 3 years ago. Today I’m working on a quarter that is going to happen in 2020. Not next quarter. Next quarter for all practical purposes is done already and it has probably been done for a couple of years.”

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Customer acquisition cost (CAC) for traditional enterprise software companies vs crypto companies

peris — Sun, 19 Dec 2021 14:02:49 +0000

Typical enterprise software companies spend approximately 7-15% of their enterprise value on customer acquisition. L1 Web3 companies spend 29-95%.

The comparison between web2 and web3 is stark, 3-7x higher CAC relative to corporate value. Even if the estimates are off by a factor of 2 or more, this math suggests crypto companies acquire customers less efficiently than their older brothers.

It also suggests future token cap tables may not be so community focused in the future, a phenomenon we’ve already observed in L1 token allocations.

In all fairness, the web2/3 CAC comparison is somewhat clementines and satsumas for a few reasons.

– equity and tokens are different instruments
– web2 companies have been highly optimized after two decades of refinement
– the valuation frameworks between web2 & web3 companies aren’t identical
– this calculation doesn’t include testnet incentives
– it excludes ecosystem funds raised by cryptocos to develop their ecosystems

Nevertheless, the concept of CAC will permeate crypto go-to-market strategies at some point.

But not today. I haven’t met a crypto company that talks about CAC. Or sales and marketing spend. Or ROI. It’s too early in the development of the ecosystem for most businesses to concentrate on customer acquisition funnel optimization.

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Onboarding at Zapier

peris — Tue, 26 Oct 2021 20:15:41 +0000

Onboarding is another essential process that had to be reinvented for Zapier’s nontraditional setup. And it’s another one that Foster finds they’ve actually improved on. “Think about a co-located office. When you join the company you walk in, get introduced to everybody, maybe meet the executive team for a lunch the first week,” he says. Enter Zapier’s “Airbnonboarding” concept, where a new hire or two join the three cofounders, often with a couple other team members, and work out of a Mountain View Airbnb for a week.

“It really helps build the relationship between us as founders and everyone on the team, because they come out here and for a week and we work in the same room. In the evenings, we hang out and take them out on the town,” he says. “They know we care about them and we want them to be successful. It makes it a lot less scary to interact with us — and everyone else on the team — in Slack.”

Clearly, the Zapier team are big fans of their distributed structure, and they’ve taken pains to make theirs a rich, complete workplace. But whatever your setup, Foster shares one note of caution: think twice before moving toward a hybrid local/distributed workforce. “The toughest scenario seems to be doing the split, because now you have these two cultures. You’ve got your in-office culture and now you’ve got these remote people. It creates a second-class citizen out of remote workers, because they aren’t hooked into the hub. ”

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Scaling is not about doing more of the same thing you’ve been doing

peris — Mon, 18 Oct 2021 14:49:18 +0000

it’s easy to believe that getting to the next sustainable level is simply the result of efforts similar to the ones that got you here.

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Too big to fail

peris — Sun, 26 Sep 2021 11:38:22 +0000

“Amazon is not too big to fail,” he once warned employees at an all-hands meeting. “In fact, I predict one day Amazon will fail. Amazon will go bankrupt. If you look at large companies, their lifespans tend to be thirty-plus years, not a hundred-plus years.”

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You’ll buy what I tell you to buy

peris — Wed, 22 Sep 2021 22:17:31 +0000

“Moving ads to the top of search pages was the game changer,” said an Amazon computer scientist who worked on the ad business. “Sponsored products would be nothing close to what it is today if that decision wasn’t made, and Jeff was the one who signed off on it.”

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Business units goals and metrics

peris — Sun, 19 Sep 2021 09:16:16 +0000

Bezos and other Amazon executives wanted the whole effort to move even faster. They set “S-team goals” such as requiring the team to grow product selection by a certain amount. Around five hundred such goals were established inside Amazon and approved by the leadership committee at the end of every calendar year, establishing the most important metrics for each business unit at the company. Teams that owned those goals were required to supply frequent updates on their progress and explanations if they fell behind schedule. It was a crucial way that the S-team managed a sprawling amalgamation of loosely affiliated business units.

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How to anchor customer relationships

peris — Fri, 17 Sep 2021 23:09:43 +0000

Herrington’s memo pointed out that Walmart, Carrefour, Tesco, Metro AG, and Kroger were the world’s five largest retailers at the time. “All of them anchor their customer relationship in groceries,” he wrote. If Amazon’s retail business was going to grow to $ 400 billion in gross merchandise sales, it needed to transform a model based on infrequent shopping for relatively high-priced goods to more regular shopping for low-priced essentials. In other words, if the company was going to join the ranks of the biggest retailers, the S-team had to figure out a way to profitably sell supermarket items. If they didn’t, Amazon was going to be vulnerable to rivals who already enjoyed the shopping frequency and cost advantages of the grocery model.

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Let customers decide

peris — Wed, 15 Sep 2021 22:36:55 +0000

The perennial debate inside Amazon was pitting the quality of products versus the quantity. The fights often had to be arbitrated by Faricy’s boss, senior vice president Sebastian Gunningham, or by Bezos himself. Both leaned heavily toward expanding the breadth of selection as fast as possible. “Jeff and Sebastian’s view was that all selection is good selection,” said Adrian Agostini, a longtime marketplace executive. “They wanted rules in place: don’t offend, don’t kill, don’t poison. Other than that, you take what you get and let customers decide.”

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