Tony Hsieh, entrepreneur who made Zappos an online retail giant, dies at 46

By Matt Schudel,

Tony Hsieh, a Silicon Valley entrepreneur who built Zappos into an online shoe and clothing retail giant and became an influential figure in technology and management circles, before stepping down as chief executive in August, died Nov. 27. He was 46.

His death was announced by Zappos chief executive, Kedar Deshpande. The Associated reported that Mr. Hsieh (pronounced “shay”) had been injured in house fire on Nov. 18 while visiting family members in New London, Conn. Complete details were not immediately available.

Mr. Hsieh was a recent Harvard graduate when he founded his first business, Link Exchange, an online advertising company. In 1998, he sold the business to Microsoft in for $265 million.

He quickly began looking for new venture capital opportunities and in 1999 invested in an online retailer called ShoeSite.com. He quickly took over as chief executive, changed the name to Zappos — derived from the Spanish word for shoes, “zapatos” — and transformed it into one of the most innovative and far-reaching companies on the Internet.

Drawing on a sense of idealism, Mr. Hsieh adopted a dual approach to business by emphasizing exceptional customer service and by making Zappos an inviting place to work. He overcame customer skepticism about buying shoes online by offering free shipping and returns.

Mr. Hsieh sold his house in San Franciso to help finance an 800,000-square-foot warehouse, using robots and high-tech equipment to find inventory and ship packages to customers.

At the Zappos corporate offices, employees enjoyed lucrative salaries and benefits, including full health-care coverage, free lunches and on-site chiropractors and other health care specialists. One of the core values Mr. Hsieh established for his company was “create fun and a little weirdness.”

Zappos was often cited in Fortune magazine and elsehwere as one of the country’s best companies to work for.

“We believe that a company’s culture and company’s brand are really just two sides of the same coin,” Mr. Hsieh told the Las Vegas Review-Journal in 2009. “If you get the culture right, then most of the other stuff will happen on its own.”

Mr. Hsieh was a serious poker player who made frequent trips to the casinos in Las Vegas. In 2004, he moved Zappos headquarters to Henderson, Nev., and nine years later to downtown Las Vegas.

“We saw Zappos as a global brand like Virgin — except whereas Virgin was about being hip and cool, Zappos would be about offering the best service,” Mr. Hsieh wrote in Inc. magazine in 2010. “The plan was to grow sales to $1 billion by 2010 and eventually go public.”

The quickly growing company did not reach profitability until 2006, but by 2008 it recorded $1 billion in sales, two years ahead of schedule. In 2009, Zappos was bought by Amzaon (whose founder, Jeff Bezos, owns The Washington Post) for $1.2 billion. Mr. Hsieh stayed on as chief executive.

In 2009, Mr. Hsieh launched a $350 million program called the Las Vegas Downtown Project, in an effort to transform the city into a vibrant hub for technological innovation and an enjoyable place to live. His company bought the old Las Vegas city hall building to refurbish as a new corporate headquarters.

“It’s the Downtown Project’s big bet that a focus on collisions, community, and colearning will lead to happiness, luckiness, innovation, and productivity,” Mr. Hsieh told Wired magazine in 2014. “It’s not even so big a bet. Research has been done about this on the office level. It’s just never really been applied in a consolidated way to a city revitalization project.”

This is a developing story. A complete obituary will follow.

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