Matt Yglesias on How Amazon “Gets Away With It”

If you’re running a non-technology company or even an “old” technology company, you’re probably still picking your jaw up off the floor at the sheer amount of chutzpah today’s web CEOs have in eschewing profitability for growth.

The story of how Amazon’s Jeff Bezos “gets away with it” – and by it I mean doing $73 billion in sales last year while earning less than $300 million – dates back to the CEO’s masterful bond sale just before the dot com crash in February 2000 along with some well-timed profitable years once the magic had worn off in the mid-aught’s. Bezos grabbed capital when he could, not when he needed it, and he put up big earnings when earnings were “required”.

This strategic savvy bought him the leeway to essentially do whatever he wants now and young web companies like Twitter are paying attention.

Matt Yglesias has a new piece at Slate’s MoneyBox (perhaps one of his last?) that walks us through this phenomenon, along with the cash-hoarding and activist-repelling that have become all the rage in the Valley of late. This weekend’s must read is below:

The Prophet of No Profit (Slate)