Tony Hsieh's Departure From Zappos: A Legacy Of Happiness And Change

In news that shocked people outside of the company, Zappos CEO Tony Hsieh, who has been delivering happiness for two decades, announced that he is leaving the company he founded, effective immediately. His next stop: retirement. Back in 2009, Amazon bought the online shoe and clothing retailer for $1.2 billion. COO Kedar Deshpande will replace Hsieh as CEO. No official plans on what Hsieh will do next have been released but, a spokesperson indicated that he plans to support philanthropic causes as well as entrepreneurs who are focused on social good.

After founding (and selling) a number of tech companies, Hsieh (alongside Alfred Lin) turned to the idea of selling shoes online in 1999. At first, Hsieh was not convinced that this was even a remotely viable idea. But, after learning that the footwear industry in the U.S. (at the time) was a $40 billion market, with almost no sales occurring through the internet, he changed his mind.

In 2000, Hsieh joined Zappos as CEO. One of his first decisions was to relocate Zappos corporate headquarters to Las Vegas, citing the relatively reasonable cost of labor and real estate compared to the San Francisco Bay area. In his first year as CEO, Zappos earned an impressive $1.6 million in revenue. Nine years later, Zappos's revenues had grown to over $1 billion per year. Along the way, Zappos started to earn a reputation for having amazing corporate culture that focused acutely on employee happiness and providing the best customer service of any retailer. Zappos' internal culture is governed by what Hsieh calls "Zappos Family Core Values."

There are amazing reviews for Zappos' customer service all over the internet. Hsieh has often remarked that Zappos sells customer service, not shoes. This is evident. In 2020, the company debuted the sale of single shoes for people who don't need two. It isn't just customers that are thrilled with Zappos. Employees are too. The company publishes the "Culture Book" annually. In it, each employee – called Zapponians internally – write a few paragraphs about what the company means to them. In 2010, Hsieh's own book, "Delivering Happiness," debuted at the top of the New York Times bestseller list.

After the Amazon sale, Hsieh stayed on as advisor to Zappos and leased the old Las Vegas City Hall building in downtown Las Vegas for 15 years. The neighborhood has been on the decline for the better part of 25 years, but where most saw homeless people, seedy motels, and blight, Hsieh saw opportunity. In 2013, 1,500 Zappos employees moved from the company's former headquarters in the Las Vegas suburb of Henderson to the new downtown offices.

Zappos has revolutionized the way e-commerce customer service works. Zappos' habit of going above and beyond for the customer has become mainstream. The company's focus on employee culture has also become mainstream.

Hsieh has a net worth of $850 million and he stands to make even more from his exit from Zappos due to another company policy: the quitting bonus. New hires at Zappos are offered $1,000 to leave at the beginning of their employment if the culture isn't a fit. Amazon also adopted this practice in 2014, but offers new hires $2,000 to leave during their first year with the company and an additional $1,000 for each year, up to a max of $5,000. In all likelihood, Hsieh left Zappos with a $5,000 check in his pocket. Tony Hsieh is 46 years old.

Table of Contents

• Biography of Tony Hsieh
• Zappos Legacy and Corporate Culture
• Impact on E-commerce and Customer Service
• Philanthropic Efforts and Future Plans