Personal blog of Geoffrey Lewis. Musings of a first time founder trying to keep it glued together @topguest, formerly @udorse . Different is good

7/22/2009

The $900 Million HR Department

Amazon has entered into a deal to acquire Zappos for around $928 Million dollars worth of AMZN stock. Zappos is an online shoe store with an extraordinary corporate culture. I'd venture to say that Amazon is paying about $28 Million for the online shoe store, and $900 Million for it's corporate culture.

At most companies, corporate culture is the domain of the HR department, where it exists as a muddled milieu of mission statements and handbooks that nobody reads. In contrast, CEO Tony Hsieh turned all of Zappos into a fantastical, Willy Wonka-esque HR experimentation lab.

Udorse has no qualms about shamelessly stealing some of the Zappos HR Lab inventions as we scale up. One we've already adopted is what we're terming "Ultra High Touch Hiring." We proactively identify specific awesome people we want to hire, and then go after them with everything we've got. In our 1.5 months of existence, this has included flying across the country to hang out over coffee with strong candidates, scouring all our networks for leads, and donating some solid coin to charity [as referral bonuses]. So far, it's working. Some other companies that seem to do Ultra High Touch Hiring [UHTH] really well include Rapleaf, and my former employer Clarium.

I posit that Bezos is far more interested in Zappos the HR Experimentation Lab than he is in Zappos the Shoe Store [though there are obvious synergies between Zappos and Amazon's Endless.com]. Hsieh's Ninja HR skills injected about $900 Million incremental value into a company that otherwise would have been entirely normal. Kudos.

[Special thanks to my business partner Trevor, who inspired this post]
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