Unlike stories, real life, when it has passed, inclines toward obscurity, not clarity.
There’s a relatively famous line from Bezos, circulated first at YC in ’08 and then more recently by the folks at Acquired (a great pod!):
Jeff uses this analogy for AWS. He talks about European beer breweries around the turn of the 20th century.
Electricity has just been invented. This was this massive enabling technology. Breweries could now brew vastly more quantities of beer than you could before electricity. The first breweries to adopt it built their own power generators. It worked fine for a few years but it was super capital intensive.
Then the utilities companies came along and the next generation of breweries just rented the power from the utilities companies. They beat the first generation of breweries because guess what: whoever makes your electricity has no impact on how your beer tastes.
“Focus on what makes your beer taste better” is a great slogan, and the kind of MBA-ism that makes you feel slightly cleverer for having said it.
But it’s always rubbed me the wrong way, for two reasons:
- As far as I can tell, the metaphor has no basis in reality. There is no cohort of once-large brewery that got extinguished in the early 20th century. I’m not sure it even makes sense if you think about it for more than a few minutes.
- Bezos is deploying this metaphor in the context of AWS, a service entirely orthogonal to the “beer” that Amazon was selling in the early aughts prior to EC2.
Metaphors can entertain and enchant but they’re rarely accurate. Bezos wanted to sell people on using AWS; he told a famous story about why they should use AWS, and the lesson there is in sales, not operations.
Software businesses are not much like turn-of-the-century Bavarian breweries; you may want to use AWS, you may want to use Clerk and Vanta and outsource large swathes of your business and you may be correct, but Seattle and Portland and San Diego and Richmond are littered with breweries who made a great product but couldn’t quite get the business part figured out, either.
