Amazon’s Prime Mistake

Jeff Bezos likes to write letters. He writes to shareholders, to the press and most recently to New York City when Amazon pulled out of its deal to relocate HQ2. Most of these letters take bold positions. “I’m sorry for being profitable”; “I won’t stand for bullies”; etc. Jeff and his letters set the tone for how the world sees technology leadership.

Which is why the last one was so disappointing.

I have been a NYC-based technology entrepreneur since the early days of the Internet. My brother Stephen and I successfully co-founded one of the Internet’s seminal companies, LinkShare (now Rakuten LinkShare), created jobs for hundreds of employees and a source of income for millions of people around the world. My husband Tad was part of the first management team of Overstock.com, one of Amazon’s leading competitors. All three of us competed against Jeff Bezos and Amazon. We have seen Amazon in all of its Machiavellian magnificence.

And yet, I still cheered when the company decided to make NYC its second home. I eschewed naysayers for what I saw as a reckless rejection of 25,000+ high-paying jobs and what that would mean to the city’s future and NYC’s relevance as a global technology hub. I supported the subsidies, citing historical examples of how NYC abandoned the film industry and Philadelphia lost the finance industry, both never to be recovered, and praised the forward-thinking approaches of other cities like Paris, Beijing and Montreal in actively recruiting AI driven businesses.

It was inspiring to see the political process work with a stunning collaboration between a governor and mayor who rarely see eye to eye. It was validation of the tireless work of Kathy Wylde, President of the Partnership for NYC, where I serve as a board member, and her team to support NYC’s economic growth. I was proud of Jeff, a fellow technology pioneer, taking the bold step to pick NYC, one of the most expensive cities in the world to work and to live, underscoring that talent and people mattered above all else.

And then Amazon backed out of the deal. In the lamest way possible. Through a letter.

After a series of closed-door meetings, they stunned business leaders and publicly humiliated government officials who had worked to bring opportunity to their constituents despite a fierce backlash from the community and its political representatives.

Just a week before, Jeff Bezos was a hero — outing people who tried to blackmail him, bravely sharing embarrassing emails to expose those abusing their power.

Now the bully was Amazon. The takeaway was: stand up to us and we’ll take our jobs and your future prosperity elsewhere.

Like the letters he sends to shareholders, his letter sent a message. It invigorated the people who feel (and sometimes are) left out of the new world that technology is creating. Jeff and Amazon had a moment to show that technology will create better outcomes for the majority of people it touches.

In short, they blew it.

Savings and subsidies weren’t the real reason Amazon chose NYC. There are many, many cheaper and easier places to do business. Amazon chose NYC for a talent pool that is unparalleled in breadth and depth. Unlike other cities, NYC is not a one-industry, one-university, one-ethnicity, one-religion town or a place where success stories all look and sound the same. The incredible range of people and companies sustain an unique and remarkable ecosystem.

New York is one of the few places where diversity is truly celebrated. It is the city that survived a devastating terrorist attack in 2001 and still rejects reactionary policies proposed by national leaders in response. It is the city that has had high-ranking officials in government who represent every race, religion and gender.

Diversity is the reason our talent is so incredible. Unlike other technology hubs, NYC can point to multiple successful technology exits, like mine, where women and people of color are founders and funders. We have dozens of companies, like Warby Parker and Casper, where social purpose fuels profitability. There is no “mafia” of technology founders, but rather a group of extraordinary women, men, minorities, immigrants and social entrepreneurs whose tech businesses span enterprise, AI, retail, entertainment, education, real estate, advertising, fashion, finance, health, food — companies like my own Collective[i], sure, but also Infor, Andela, Billies, The Wing, Peloton, General Assembly, WeWork, Knotel, Candoo Tech, Next Jump, Refinery29, Compass, Crisis Text Line, Etsy and countless others.

NYC based Girls Who Code and All Star Code create a long-term pipeline of tech talent from underrepresented populations. Springboard Enterprises, SAP.io, Venture for America, Built by Girls (BBG), Female Founders Fund and Black Women Raise are cultivating and funding amazing companies with diverse founders.

NYC welcomes immigrants as essential fuel for our city’s rich culture and evolution. Our music, theatrical and art scenes thrive because of the collective creativity of people with a multitude of life experiences. Billionaires and artists share the same subways, where on any given day you hear hundreds of languages spoken and don’t bat an eye.

NYC is proof that diversity breeds greatness. Every restaurant, museum, neighborhood and business represents a different point of view. New Yorkers know that if you want to create the best the world has to offer, you have to enlist the best people the world has to offer. What other city could breed Hamilton — a hip hop musical celebrating one of America’s founding fathers produced by a woman (Jill Furman) and written by a Puerto Rican playwright?

Diversity, however, is hard. It sows conflict that requires debate and compromise. But I concede that conflict is essential for progress. Because not everyone thinks or lives the same way, consensus is rare and herein, the key to innovation. Different ideas get surfaced and considered, however controversial. Thanks to that conflict, and its resolution, the best ideas come to fruition.

It’s pretty clear that tech hasn’t done well with diversity — especially not in hubs like Silicon Valley and Seattle. Nor has tech presented a plan for how the world will look better for everyone simply by its existence. From the outside looking in, it appears that if you are not rich, white, male, computer savvy and under 40, you simply don’t matter.

A lot of people feel displaced and afraid. Many have reason to feel both. We have created a new refugee crisis: People who aren’t connected, or who lack the work skills for a new economy or who simply don’t want to adapt because change is uncomfortable. And the tech industry hasn’t done much to counter that fear or address the displaced. Amazon only added fuel to the fire.

The cities where tech reigns aren’t exactly a beacon of progress. A walk through San Francisco is depressing; it’s worse than NYC in the 1970s: Heroine needles, homeless people on every corner, outrageously-priced housing and staggering wealth adjacent to tent cities. With all of the innovation, Seattle — Amazon’s home — is no better. Despite being the 18th largest city in the US, it has the 3rd highest homeless population. The middle class in those two cities has been decimated.

The very vocal minority opposing Amazon’s headquarters had a right to question if progress was really “progress for all” or just a fake smile on a box. And Jeff had a moment to show the world that his company isn’t just a parasite, but one with a plan to improve, include and elevate its community.

Jeff had a moment to be a leader, as he did one week prior in his letter about being blackmailed, and address the thorny issues (some created by, and some exacerbated by, the Tech Boom) that come with massive transformation.

It was the time to explain why people like me build technology companies. We want to fix big problems, not create new ones. Jeff had a platform from which to demonstrate how the flying cars Amazon is building could address the congestion facing large cities, so people could understand the exuberance around their funding. He had a moment to show how 3D printing could help with city planning and development to provide affordable housing and eradicate homelessness, and how Amazon’s partnership with JPMorgan and Berkshire Hathaway would lower all of our health costs and improve quality of life.

He could have pointed to the power of AI to elevate the societal value of caregivers, artists and teachers and Amazon’s plan to educate and employ people whose skills have become obsolete. He could have articulated how his company’s margins would afford better working conditions for the people in warehouses and call centers.

He could prove the spoken, but less frequently executed, value that most of us in tech fundamentally embrace: tech serves people, not the other way around.

Instead Amazon wrote a letter. A message from the Wizard of Oz, hiding behind a curtain. What a mistake. What a waste of a moment and a message.

As we all navigate a future driven by technology, it is imperative that we embrace objections and answer them, even when the answers are complicated or challenging. The skills to manage diversity are the same you need to manage transition, to make sure people with different perspectives and needs share fairly in an expanding pie. Diversity means working through the hard stuff. Engaging. Not picking up your ball and going home.

Jeff could have shown up to a city council meeting. He could have had a discussion open to the public. Everyone could have presented concerns and alternatives. He could have modified the subsidies and invested in the outcome. To do so would take time, finesse and compromise, but that is what true leaders do. And in NYC, our diverse talent pool is worth it.

New York City’s business, political and tech leaders view diversity as an advantage, and giving back to the community as an obligation. We know that a variety of thought opens new markets, creates new ideas, produces higher quality talent and makes our companies, frankly, more interesting places to work. Business leaders like Henry Kravis, Danny Meyer and Deanna Mulligan have made inclusion their NYC-based companies’ missions because they know it is essential.

Jeff, here’s my letter to you. What happened in NYC was a wake-up call and a challenge worth facing. By engaging, you had a chance to show the world what most of us in tech fundamentally believe: technological progress can and should be progress for all.

New York is a microcosm of the world’s people and opinions. The concerns voiced by New Yorkers represent more than a vocal minority — they are the voice of people who feel left out and disenfranchised by the changes we are bringing to the planet. Running away from NYC and all its conflicting views made a clear statement that tech companies like Amazon have no plan, only power. And that, in my view, is not only inaccurate, but an unfortunate stigma to attach to our community.

No one said it better than Mike Bloomberg — tech entrepreneur, billionaire, subway rider and former NYC mayor: “We’ve shown the world that New York can never be defeated, because of its dynamic and diverse population and because it embodies the spirit of enterprise and the love of liberty. And because no matter who you are, if you believe in yourself and your dream, New York will always be the place for you”.

Amazon and Jeff Bezos should have done better. NYC and its tech leadership will do better.