Going Out on Top
“Bezos also demonstrates something that’s very hard to do pro-
fessionally: go out on top,” according to Boneparth. “Nothing
can be more detrimental to the value of one’s practice than
failing to pass the baton or exit. It also shows the importance of
having a succession plan and knowing who to pass the baton to.”
Agreeing on that latter point, Tommy Marshall, executive
director of Georgia Fintech Academy, said: “My understanding
is that Bezos groomed the replacement for quite a while.”
That replacement is current Amazon Web Services (AWS)
CEO Andrew Jassy, who will take the helm this summer, while
Bezos will become executive chair of Amazon’s board, the
“Bezos is changing his position on a high, which is thedream for most CEOs, and especially founders,” according toleadership consultant Jennifer Mackin.
Good Succession Planning
“Succession planning requires greatthought and time, which I think has goneinto Jeff Bezos’ decision. Announcingsix months ahead of the change is a lotof notice,” explained Mackin.
Bezos “can help advisors realize thatthey can step back from a business thatlikely feels synonymous with them,”said David DeVoe, CEO and founder of consulting firmDeVoe & Co. After all, “if Jeff Bezos can step back fromAmazon, you can surely step back from your RIA — with theproper planning,” he said.
“Ideally, this realization — that even you are replace-
able — can help move the succession planning forward,”
DeVoe explained. “Many of us CEOs won’t let go. Realizing we
can let go is the first step in transition planning.”
However, the Bezos succession plan is “not an example to
follow” because “surprise announcements are not good for the
founder transition,” he argued.
“By contrast, the transition plans of Chuck Schwab at Schwaband Harvey Golub at American Express are the gold standard,”DeVoe said. These CEOs seasoned their candidates with a variety of senior roles, then identified their successor years before aspecific transition date, and were there to coach them for years.”Unlike the other experts, consultant Craig Iskowitz, CEOand founder of Ezra Group, didn’t see much of a lesson thatadvisors can take from Bezos and Amazon.
“It’s become a meme in our industry to compare client experience with an advisor to Amazon,” Iskowitz said. However,“it’s not a fair comparison” because “choosing an advisor is verydifferent from buying physical products from a retail website.”Fintech and financial services firm Acorns provides “anexperience that advisors should look to emulate” instead, hesaid: “Create a community and focus on education and savingsto attract younger demographics.”
Amazon & Financial Services
Before starting Amazon, Bezos worked for telecom firmFitel and then investment management firm D.E. Shaw & Co.Amazon, meanwhile, has frequently expanded its product andservice assortment over the years.
Is Bezos likely to return to the financial sector in some wayon his own, or is Amazon interested in making a major pushinto financial services? Bruckenstein is somewhat doubtful,pointing out that tech firms “tend to prefer industries with lessregulation [that] are easier to disrupt.
“That said, at some point, we will see some of the techgiants looking to get into financial services in some way,” heexplained. (That is, more than they already have.)
Welsh predicts that “Amazon will enter the financial ser-
vices industry, but not in the core world of investments.”
Although the digital rivals “he would run into are already
entrenched, have invested massively in technology and have
already competed out most of the costs of distribution,” he
said, “in areas like banking and insurance, there are still tre-
mendous opportunities for Amazon to leverage its distribution
might and disrupt those slow technology adopters.”
Because of “the sheer number of financial transactions that
Amazon is responsible for, you can make a pretty good argu-
ment that they would get into the financial services space,”
“However it seems clear that they are more focused onAmazon Web Services, so there’s an argument to be made thatfinancial services is not at the top of the priority list,” he added.
More Views on Amazon’s Plans
Iskowitz says Amazon is “already in financial services” anyway, explaining: “They have a multibillion-dollar commercialloan book (lending to small third-party sellers), you can openan Amazon checking account (through Chase), sign up for anAmazon Rewards Visa Card, load cash into an Amazon wallet,and get a credit score from the company’s virtual assistant Alexa.”However, “the $1 million question for advisors is will theyoffer investment accounts?” Iskowitz noted. “I don’t think so.They’re focused on the retail banking side since this is moreclosely related to shopping activity.
“I would expect a [buy now, pay later] partnership to be ontheir roadmap,” he said. “Remember that another huge retailer
“As an industry, we are still way behind mostother industries with regard to machine learningand AI. Those who embrace these technologiesintelligently will prosper in financial services.”