In the nearly 10 years since it launched, Amazon has acquired upwards of 40 companies — and not all of those acquisitions have been amicable.
An interesting piece in Dallas’ D Magazine profiles Matt Rutledge, who sold his daily-deals e-commerce company Woot to Amazon for $US110 million in 2010. In it, Rutledge shares the story of his first meeting with Amazon CEO Jeff Bezos after the deal had been signed.
Not only does the anecdote reveal that Bezos is lousy at small talk, but it proves something about the way he thinks about business and Amazon’s strategy with acquisitions.
Rutledge flew in from Dallas Sunday night to go out to breakfast with Bezos Monday morning. He had signed a contract to stay with Amazon for the next three years and thought the meeting was going to be an important way for Bezos to bring him into his inner ranks. Generally, the meeting ended up being awkward, with Bezos
Bezos had ordered an exotic meal: Mediterranean octopus prepared with potatoes, bacon, green garlic yogurt, and a poached egg. When Rutledge asked Bezos why he had decided to buy Woot, Bezos paused for “several painful seconds” before answering.
“You’re the octopus that I’m having for breakfast,” Bezos said. “When I look at the menu, you’re the thing I don’t understand, the thing I’ve never had. I must have the breakfast octopus.”
About two years after Woot’s acquisition by Amazon and that breakfast meeting, Rutledge left the company before his contract was up. The pressures of operating under and reporting to Amazon had started changing Woot’s fundamental style, and Rutledge wanted to get out. Amazon bought Woot because Bezos didn’t understand it and thought it was exciting, but instead of embracing Woot’s style and learning from it, Amazon made it change.
Cue the chilling line from D Magazine’s Tim Rogers: “Before it can be eaten, generally, the breakfast octopus must be killed.”
Amazon acquires interesting companies that are doing big things (Inc. Magazine had named the quirky Woot the fastest-growing private retailer in the country in 2008) that it can’t understand, but sometimes that zeal to acquire doesn’t pan out too well for the little guy.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.