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This article was taken from the September 2013 issue of Wired magazine. Be the first to read Wired's articles in print before they're posted online, and get your hands on loads of additional content by subscribing online.
There is a whooping, DJ-fed party atmosphere today outside the Zappos corporate headquarters, 20km from the Las Vegas Strip in Henderson, Nevada, as women employees line up to have their heads shaved and men sacrifice back hair and eyebrows. This is "Bald
& Blue Day", for which each shaved pair of eyebrows or dyed-blue hairstyle earns local charities between $50 and $300 (£32 to £200). Inside the low-built office block, past the t-shirt gallery in Recognition Hall (one commemorating $1m (£640,000) in daily revenues on 30 November, 2004; another marking $22m (£14m) last 26 November), the Z Café sells "core value drinks" based on the company's defining mantras ("Deliver Wow Through Service Cappuccino"... "Be Passionate and Determined Passion Tea").
Zappos is no ordinary online shoe-retailer. It was acquired by Amazon four years ago in an all-stock transaction valued at $1.2bn (£770,000) and its declared mission, according to its charismatic CEO Tony Hsieh, is to build a company culture around fun, excellence in customer service, and -- to paraphrase the title of his bestselling 2010 book -- using "profits, passion and purpose" to deliver happiness itself. The company still famously offers all new staff $2,000 (£1,300) to quit halfway through their compulsory four-week customer-service training, to weed out those not fully committed. Yesterday, staff handled 8,793 customer calls, 1,876 live chats and 1,597 received emails, and sent 227 thank-you cards as well as flowers and biscuits. As a "corporate challenge" parade of casually dressed employees suddenly marches noisily through the office, Dani Greer, the Zappos "culture kitten" leading the visitor tour, explains that "our longest customer-service call ever was nine-and-a-half hours".
Some 22km to the northwest, on the neglected streets of downtown Las Vegas, Hsieh is leading a bold experiment to transplant his cultural values to an entire cityscape. From his apartment in a development called the Ogden, 5km from the Strip, he is investing $350m (£225m) of his own money to create the "collisions, co-learning and connectedness" that he believes can revive the neighbourhood and attract entrepreneurs and creative talent through real-estate development ($200m [£130m]), plus investment in tech startups, education and culture, and small businesses ($50m [£32m] each). To kickstart what's known as the Downtown Project, in September he starts moving the Zappos team into the old City Hall.
Eventually, he hopes to raise population density from six people per hectare to 40.
"If downtown Vegas can become a place of entrepreneurial energy, inspiration, accelerated learning and community -- and in a place voted least likely to succeed -- then there's really no excuse for any other community or city," Hsieh explains in his apartment. "We're investing in tech, manufacturing, fashion, arts, music, healthcare -- if there's this whole ecosystem with people from all different backgrounds that, in any other city, would be in different parts of the city, if we're helping build a culture where there's a bias towards collaborating -- then we're going to see pretty amazing innovations. And that will put us on an exponential growth curve."
The project is a natural extension of the Zappos ethos, Hsieh explains. "There is plenty of research that shows companies with strong cultures outperform their peers," he says. "The question isn't, do you want to make staff happy through company culture or do you want long-term profits? The answers are the same. Culture is to a company as community is to a city. Think in terms of the iPhone -- we're building the hardware and the iOS here, producing a few killer apps to show what's possible, but the power of the ecosystem is the platform."
Influenced by urban thinkers such as Edward Glaeser and Richard Florida, Hsieh is convinced that by encouraging social and entrepreneurial mixing -- plans include making 100 Tesla cars available for hourly rental, programming a speaker series, creating hackerspaces and shared work spaces -- he can build long-term economic growth. "We're investing in businesses where, as well as being a good investment, the owners care about building their community," says Hsieh. "It's whether the entrepreneur running the bakery wants to do more than just bake bread, but to connect customers who have the same interests. People want to have places where they can gather and share ideas. So a lot of our speaker series takes place in dynamic construction trailers. What matters is the connections between the people, developing that culture of caring about something bigger than yourself."
For Hsieh, the Downtown Project is a development of his interest in engineering creative social gatherings. "For me, it started with running parties. I got thinking: if there are multiple bars at a party, what if you shut one down so people circulate and interact? Going from parties to the office environment, how do we get Zappos employees to run into each other more often? Now it's how to get people in a city to collide with each other more often."
He then makes Wired an invitation. "You should get the whole team to live here, downtown, for a month or two. You can't write Wired remotely? We can find you all an apartment here... Or maybe you should open up a really cool story-worthy bar?"
This article was originally published by WIRED UK
