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The complexity and brilliance of Tony Hsieh: a personal appreciation

·13 min read
Zappos CEO Tony Hsieh
Zappos CEO Tony Hsieh

When is the right time to assess a founder’s legacy? If we had assessed Mark Zuckerberg’s impact on the world five years ago, it would have looked much different than today. And if we were to assess Zuckerberg’s impact in yet another five, ten, or twenty years, it again could look very different. What if the coda to Jeff Bezos’s story had been that time he built an online bookstore? Instead, investors and the public gave Bezos time to build out his much grander vision, and because of that Amazon was able to acquire, among many other businesses, the online shoe retailer Zappos for $1.2 billion in 2009.

Bezos loved Zappos’s obsession with customer service, and as part of the deal he gave CEO Tony Hsieh the freedom to run with bold management experiments that would leave other CEOs shaking in their boots. Bezos clearly recognized Hsieh’s once-in-a-generation creative genius and didn’t interfere when the Zappos executive relocated his company from a pristine suburban office park to a blighted part of downtown Las Vegas, investing his windfall from the Amazon sale in order to revitalize the area and create a startup ecosystem. Hsieh wanted to create a microcosm of Silicon Valley that was infused with the ethos of Burning Man. Embracing the principles of startup culture, Hsieh sought to do this in a highly accelerated time frame of five years.

I was so captivated by Hsieh’s vision that I upended my life in New York and decamped to Las Vegas to write a book about the project. My publisher also embraced the startup ethos with my book and we decided to publish it right at the five-year mark. It made sense from a marketing standpoint to publish the manuscript when there was mass interest in the experiment, but in hindsight it was too soon. The Downtown Project was still responding to myriad challenges and startup failures, and the general assessment of its impact was mixed at best. Its impact compounded over a longer time horizon, however, will tell a much different story.

Hsieh’s generosity and audacious vision to build a city like a startup has forever changed the City of Las Vegas. He was beloved by the city’s gatekeepers who appreciated his fresh approach to urban building and his ability to see the world from an angle. I remember the pure joy that mayor Carolyn Goodman and her husband, former Las Vegas mayor Oscar Goodman, conveyed when I interviewed them about Hsieh in 2016. They said Hsieh was the “king of the millennials.”

When the Las Vegas City Council approved the sale of its former City Hall to Zappos in 2010, Hsieh got teary-eyed. “Mayor,” Hsieh told Oscar Goodman in the final days of his administration, “I think you’re sitting in my future seat.” At the meeting where the purchase price of Zappos’s future headquarters was on the agenda, 200 Zapponians wearing bright blue T-shirts with faces of the mayor on them descended, flash mob style, into the council chambers with pom-poms. The mayor and others stood up and danced. “That’s why we’re doing what we’re doing,” Goodman announced. The council unanimously voted to roll back the sale price of its former City Hall from $25 million to $18 million.

While the city welcomed Hsieh and his investment capital with awe and open arms, the tech press was more skeptical. It was fascinating to observe the way these two competing narratives played out over time. At some points they could not be more divergent.

After a brief honeymoon period in 2012 and 2013, tech journalists turned critical when the Downtown Project suffered some difficult losses and struggled to find its way in 2014. Understandably so: there were three suicides that year by entrepreneurs involved in the project, and there were layoffs. Meanwhile, some notable Downtown Project-backed ventures abruptly shut down. The spirit that had fueled the project’s early rise felt elusive to those closest to it. “Not to get metaphysical,” recalled Ron Corso, owner of the Downtown Project-backed 11th Street Records, “but there was something with the energy.”

The trouble with how we treat tech founders

When I published my book in 2017, the Downtown Project community was still reeling. Collectively we were in the heart of a “techlash” centered around news stories like Facebook’s impact on the 2016 US election and the downsides of Uber’s aggressive company culture. Donald Trump had just been ushered into the highest office in the land and it felt as though we were entering dark times. This broader cultural mood inevitably colored aspects of my manuscript and reflections at the time.

A few years earlier, Aaron Zamost, the former head of communications and policy at Square, had published a very useful guide to understanding how narrative works in the tech sector, titled, What’s Your Hour In Silicon Valley Time? “A company’s narrative moves like a clock,” he wrote. “It starts at midnight, ticking off the hours. The tone and sentiment about how a business is doing move from positive (sunrise, midday) to negative (dusk, darkness). And often the story returns to midnight, rebirth and a new day.” I published my book, The Kingdom of Happiness: Inside Tony Hsieh’s Zapponian Utopia, when the Downtown Project was in the later hours of the clock. How different a story would it have been had I waited a year or two?

We as a society have a complicated relationship with our tech moguls and the companies they build. We praise them like gods and then tear them down when they make mistakes.

I got frustrated with Hsieh at the very end of my book process because I felt he was surrounding himself with sycophants who weren’t helping him see reality clearly. For the longest time, former Zappos COO, CFO, and chairman Alfred Lin had played the important role of being Hsieh’s genuine counterweight, but he left Vegas following the Amazon sale and is now a partner at Sequoia. (PayPal co-founder Max Levchin once described to me the relationship between Hsieh and Lin as brotherly, with Lin being the protective older sibling.) In hindsight, it wasn’t my place to fight Hsieh on those delicate matters but we had developed a friendship and my frustration came from a place of genuine care for him and his well being.

Can we find a way to break out of tradition and characterize tech moguls more like the human beings they are? What kind of impact could that have on aspiring entrepreneurs and our expectations for them? I am hopeful that, after this year of all years, that we can find ways to connect with one another on a deeper level and write more empathetic stories that don’t demand perfection from our tech moguls when they misstep but actually celebrate growth, evolution, and development along the way. We’ll be processing the trauma of 2020 for a long time and we will benefit greatly if we find a way to recognize each others’ flaws as intrinsic to being human.

Life is beautiful

In 2018, I had the opportunity to reconnect with Hsieh in person at the wedding of his former chief of staff Maggie Hsu at the Four Seasons in Seattle. Hsieh had convinced Hsu, a graduate of Harvard Business School and former McKinsey analyst, to depart from a traditional career track and help him execute on his vision for Vegas. The wedding was a relatively formal affair and yet Hsieh was sporting a mohawk—he bypassed social norms like that. We took shots of Fernet with the Zappos crew, and he gave me tips on how to officiate my brother’s wedding in Yosemite. (Those closest to Hsieh know that he was a matchmaker and officiated countless weddings for his employees and friends; he played a role in introducing me to the love of my life, too, whom I met at Burning Man.)

Tony Hsieh and friends at the Life is Beautiful festival in 2018.
Tony Hsieh and friends at the Life is Beautiful festival in 2018.

Left to right: Tony, Maggie Hsu, Hsu’s husband, and my partner, Todd, at Airstream Park, inside the Life Is Beautiful festival grounds, in September 2018.

A month after the wedding, I attended the Life Is Beautiful festival in downtown Vegas, one of Hsieh’s proudest investments. After the event I sent him this email:

From: Aimee Groth <aimee@thirdwayventures.co>

Date: Sat, Oct 13, 2018 at 12:26 PM

Subject: Life Is Beautiful

To: <tony@zappos.com>

Hi Tony,

Good to see you briefly at Life Is Beautiful. It was great to catch up with your Dad and reconnect with others from Zappos/DTP. Seeing ODESZA and meeting the artist Wynne serendipitously was a reminder of the magic that brought me to DTP [Downtown Project] in the first place! I’m sincerely grateful for the experience.

Now that more time has passed, I’ve come to see DTP as similar to Burning Man in the way that we had this amazing environment that allowed people to push themselves without any limits and grow exponentially. Also similar to Burning Man, I’ve come to appreciate that there is no joy without suffering. When my book was published, many of us (myself included) were not yet out of the weeds with the suffering that came with the experience.

With the dust now settled, many of us view DTP as this incredible personal and collective growth incubator—a once-in-a-lifetime opportunity that we all got to experience together. Although a number of the ventures failed (as was statistically to be expected), these failures gave us an opportunity for growth and to put in our first essential 10,000 hours to learn these lessons you taught us. Today many of us are out in the real world with the wisdom learned from you and our collective experience. While downtown may not have seen 20 years of physical transformation in 5 years, we all got 20 years of life experience in 5 years, and that is invaluable.

Your Dad and I were talking about what it takes to bring a vision as grand as the one you pitched for DTP to life, and he spoke to the importance of bringing in people who embrace a certain set of enduring traits. Among the most important is a commitment to the vision when things are good and when they aren’t. I brought up the fact that one of the uniquely defining aspects of DTP was the way you brought in many people who had never seen something like this through; there were many first-time entrepreneurs including myself who were not yet seasoned in managing such high volatility. Many of us developed those very traits through the experience itself.

You pushed me to consider a new way of being in the world, and I now have come to see my first 10,000 hours as merely the gateway to playing a much bigger game. If I could do it all over again, I would have handled the last few months before my book came out much differently and asked my publisher to hold the book for a year so that I could develop greater objectivity. But just like the pace and context for DTP and its accelerated timeline (mirroring the kind of growth VCs expect in Silicon Valley), my publishers too envisioned a quick turnaround and publication date, even as the story was still unfolding. At the time, I did not yet have the self-awareness and soul power to push back, though I would today. I’m sorry for the unnecessary stress I placed on you during that time; you deserved more compassion and empathy than I delivered.

The intensity of the experience inspired me to enter a more contemplative season this past year and do the necessary interior work to fully realize the gifts of the last 5 years. Among the outputs of that season is this profile of Brian Robertson and Holacracy, thought partnerships with former DTP’ers like Maggie and Rob (both now part of the ConsenSys ecosystem), and a decision to move away from a career in media and into a more operational role, inspired by you and my time at DTP. Discerning this new path is among the gifts of my experience inside the personal growth accelerator that was DTP and for that I am infinitely grateful—it’s not an understatement that going through that process likely saved me a few decades of time and woke up my soul. Through your invitation and exposure to environments like Catalyst Week and Burning Man, filled with entrepreneurs who calibrate at a high level energetically, you awakened me to envision a much larger version of myself, as you did with many others.

Managing an environment with such rapid collective growth requires a level of sophistication that I don’t think is fully appreciated by observers, and I have a lot of respect for the way you put your reputation on the line to support people in this way. The choice not to bring in more experienced operators and to give first-time entrepreneurs/operators this experience was admirable. Thus, many people had this incredible opportunity to put in their 10,000 hours during this unique moment in space and time.

DTP may not have manifested in the way many of us expected, but failure and suffering is a more instructive teacher than unconscious success. You created an environment that helped jolt people into greater consciousness and that is the true success of DTP.

Wishing you the best with the continued redevelopment of downtown Vegas and evolution of Zappos!

Aimee

We lost a bright light when Hsieh tragically left us on Nov. 27. He was an audacious visionary who touched so many of us with his magic and his humanity. Let’s honor him by recognizing the whole of who he was—in all of his brilliance, beauty, and complexity. No doubt we’ll still be making sense of Hsieh and his impact on the world for years to come. That’s part of the mystery of creative genius; its inherent paradoxes don’t fit well within a single, fixed narrative.

Friends and family are collecting memories of Hsieh at HonoringTonyHsieh.com, an interactive website that is being built and designed by Wix founder Avishai Abrahami, WordPress founder Matt Mullenweg, and their teams. UX designers Michael Garvey and Mario Nanguse also have contributed to the project. The website—which will showcase memories of Hsieh in the form of stories, photos, and videos—is being led by Lauren Randall, founder of e-commerce company Melonhopper and a close friend of Hsieh’s who participated in his Downtown Project. You can also email photos and videos to mymemory@tonyhsieh.com.

Aimee Groth is the author of “The Kingdom Of Happiness: Inside Tony Hsieh’s Zapponian Utopia,” which was published in 2017 by an imprint of Simon & Schuster.

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