Jeff Bezos is known as the person behind the founding of Amazon, a company that initially focused on selling books online. Today, however, Amazon has expanded into many sectors.
These include Amazon Web Services, e-commerce, digital services, and even hardware. Jeff Bezos’s business success has placed him in the world’s top three richest people according to Forbes.
His wealth reached US$205 billion, or around Rp3,295 trillion. This figure was recorded by Forbes on Sunday, May 12, 2024.
Of course, Jeff Bezos’s wealth did not come instantly. There was a great deal of effort and strategy behind it. What can you learn from Jeff Bezos for your own investment strategy?
Jeff Bezos’s Investment Tips You Should Know
Below are Jeff Bezos’s secrets in business and investing.
1. Research and Understand Public Opinion
Jeff Bezos cares deeply about what the masses think. By identifying, researching, and thoroughly analyzing what is on people’s minds, you can draw public conclusions that become useful for your business and investments.
According to Jeff Bezos, you should never oppose the crowd’s thinking just because you believe you are right. By conducting research followed by analysis, you can determine whether the majority opinion is wrong or right.
You can then make a choice and invest to aim for greater gains.
2. Have an Investment Philosophy
It is important as an investor to have a consistent and clear philosophy. Make sure you understand what kind of investor you want to be.
Some are comfortable with the active trading that happens in the market. Others feel more comfortable moving at their own pace.
By applying a consistent philosophy, you will be able to make decisions more rationally and guide yourself toward success. If you panic over what is happening in the market, your focus will become very chaotic.
3. Plan a Long-Term Strategy
Long-term investing is a common trait among successful investors. Jeff Bezos also applies this long-term approach.
With a long-term strategy, your potential to earn greater returns increases, although it requires patience because it takes time.
Before investing, make sure you research and analyze the field or company you are targeting. If the market is in poor condition, do not give up. Do not rush to withdraw your investments. Panic will only lead to losses.
4. Dare to Take Risks
It took Amazon three attempts before it successfully launched its sales and order-fulfillment platform. Jeff Bezos dared to take risks and eventually reached heights no one had achieved before.
Of course, taking a risky path still requires careful measurement. Even if it does not work out, you learn and gain experience so you do not repeat the same mistake in your next investment.
For example, if you make a high-risk investment, then you must be prepared to bear that high risk, not only be willing to seek a high return.
5. Have the Drive to Overcome Obstacles
During the COVID-19 pandemic, many sectors were paralyzed. Jeff Bezos took a risky step by hiring new employees. It turned out that this step increased sales and attracted more investors because of the company’s improved workflow.
Jeff Bezos is good at spotting opportunities and turning them into gains. It was not only Jeff Bezos who benefited, but many others as well.
In addition, having a personal passion for your work will help lead you to financial success. Instead of chasing trends, Jeff Bezos encourages you to look inward and explore what you believe in and what you can contribute to the world. That drive becomes your motivation.
6. Be Clear and Focused
Jeff Bezos believes that clarity and focus help investors achieve success in a highly competitive market.
For your reference, his goal for the company was to have a large customer base while applying low margins, rather than having a small customer base with high margins.
7. Learn from Mistakes
Jeff Bezos has also made mistakes in business and investing. One example is when Amazon launched Crucible in an attempt to create a video game.
However, Amazon treated game development like any other software and did not understand that games require a different development approach, community building, and player engagement strategy. Amazon relied too heavily on data and analytics. They did not try to understand game culture.
Jeff Bezos said that it was fine. The failure of Crucible helped Amazon understand the unique challenges of the gaming world and led to more realistic expectations for its future gaming ventures.
8. Build a Portfolio that Supports Your Goals
Jeff Bezos believes that building the right culture is crucial to achieving established organizational goals.
Remember that no single investment strategy fits everyone. Every investor is different, and each person must build an investment portfolio that matches their risk profile and investment preferences, aligned with SMART financial goals: specific, measurable, attainable, realistic, and time-bound.
Planning your investments wisely is important to achieve life goals and live a financially secure future.
9. Do Not Follow the Crowd
While it is important to understand what the majority thinks, that does not mean you should always follow it. You can conduct relevant research and analysis on public thinking and then draw your own conclusions.
Following the crowd in the market is unlikely to produce positive long-term results. You need to evaluate investments carefully and understand market conditions before making the right investment decisions.
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Jeff Bezos applies many strategies to achieve what he envisions, from understanding others’ opinions, daring to take risks, refusing to follow the crowd, to being willing to learn from mistakes.
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