Focus on customer, Bezos tells tech crowd

If Amazon.com made one important decision early on, it was to side with the customer.

This certitude drove the online retailer's unusual decision to carry third-party offers on the same detail page as items it sold (despite protests from its buyers), and to create an e-mail service that reminded a "non-trivial number" of forgetful customers when they had bought the same thing twice.

"It becomes the razor that helps make decisions," said founder and Chief Executive Jeff Bezos.

Bezos, who served as the keynote speaker Monday at the Technology Alliance's 10th annual State of Technology luncheon in downtown Seattle, spoke about how Amazon has used technology to better serve customers.

The conversational-style keynote was moderated by Ed Lazowska, a Technology Alliance board member and the Bill & Melinda Gates chair in computer science and engineering at the University of Washington.

The Technology Alliance, founded by Bill Gates Sr., also used its 10-year milestone to appraise how Washington state fares in terms of entrepreneurial climate, research and education.

The alliance is known for conducting the earliest studies on the economic impact of technology-based employment in Washington state.

Some facts on:

• Entrepreneurial climate: Washington ranks 12th nationwide in company creation and 16th in the number of existing high-tech companies.

• Angel funding: The Alliance of Angels, founded in 1997 by Technology Alliance board members, has invested $25 million in 85 companies, including $7.1 million in 20 companies last year.

• Venture-capital investments: The state last year accounted for $752 million, or 3.5 percent, of U.S. VC funding, according to the PricewaterhouseCoopers Money Tree Survey Report.

• Education: The state ranks fifth in its concentration of computer experts in the workforce but is 37th in the number of science and engineering bachelor's degrees earned in the state.

• Research: The state ranks 21st in academic and fifth in industry research and development. Washington is 47th in state-funded research, although its new, 10-year $350 million Life Sciences Discovery Fund should drastically improve its ranking in the future.

If the Pacific Northwest is known for its entrepreneurial bent, Lazowska questioned Bezos on why such a disproportionate number of Seattle-based companies became known for customer service — Nordstrom, REI and Amazon, among them.

"When it's raining, we just don't have anything to do," Bezos quipped. "We have plenty of time."

Bezos also gave encouragement to budding entrepreneurs in the audience to keep their eyes trained on their customers, despite competitive pressure.

He recalled when Barnes and Noble entered the online book business. Amazon had 125 employees and $60 million in annual sales, and an analysts famously declared the company "Amazon.toast."

The company held an all-hands meeting, where the employees came to an important conclusion: "We're going to wake up and we're going to be afraid, but we're going to be afraid of our customers and not our competitors," he said.

Monica Soto Ouchi: 206-515-5632