The HQ3 fiasco

I’ve shared a lot of nuggets from Jeff Bezos over the years on this blog. His notes on the importance of being open to changing your mind, on strategic patience and tactical impatience, on using long form memos for business decisions, to name just a few, have all had a big impact on how I think and operate.

As someone who admires much of his thought process and approach to things, I found Amazon’s and Bezos’ approach to their second (and now apparently third) HQ deeply disappointing.

NYU Professor Scott Galloway outlined the many issues with this fiasco in his weekly note today. 2 excerpts –

Amazon’s HQ2 search was not a contest but a con. Amazon will soon have 3 HQs. And guess what? The Bezos family owns homes in all 3 cities. And, you’ll never believe it, the new HQs (if you can call them that) will be within a bike ride, or quick Uber, from Bezos’s homes in DC and NYC. The middle finger on Amazon’s other hand came into full view when they announced they were awarding their HQ to not one, but two cities. So, really, the search, and hyped media topic, should have been called “Two More Offices.” Only that’s not compelling and doesn’t sell. Would that story have become a news obsession for the last 14 months, garnering Amazon hundreds of millions in unearned media?

We are not only witnessing the 1% pull further away from the 99% in our hunger games economy, but certain metros begin to pull away from the rest. Of more than 400 metros in the US, five account for over 20% of the growth. And, you guessed it, two of those five are DC and NYC. This is not Amazon’s problem, but this was an opportunity to do something extraordinary. Locating HQ2 in Detroit would have been transformative.

Scott Galloway’s conclusion is withering in its assessment of this move that displayed canny PR and negotiation and a disappointing display of capitalism taken to its extreme all at once.

I keep going back to a note from Seth Godin on capitalism – capitalism exists to maximize civilization and not the other way around.

This was a classic case of the other way around.