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Zappos Milestone: Q&A With Nick Swinmurn

The company founder on launching the start-up and deciding to leave.

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FN: Did your departure shock the team at Zappos?
NS: I think they probably knew I wasn’t that interested anymore, but they might have been surprised that I was actually leaving. They were probably more worried that people would think that something was wrong. And there wasn’t. I was just over it. It had been a long time.

FN: Do you still have a stake in the company?
NS: I’m still a shareholder, and I still attend the board meetings. I sold shares privately at different points over the years, but I still retain a fair percentage of what I started with. ... When we started, I owned almost all of it, but I kept getting diluted. We all trusted Tony, so he would negotiate with himself. He would say, “OK, we need another $1 million. I will put it in, and this is what part of the company I am taking.” Also, in 2005, Sequoia Capital invested about $35 million.

FN: What do you think of Tony’s plan to expand into other markets such as apparel and electronics?
NS: There’s always a risk in trying to expand because then what does the brand stand for? For so long, the brand stood for shoes and handbags. Is it better to make sure Zappos always dominates that market, or is it better to offer everything? In Tony’s vision, it’s not even just about selling stuff. He has a vision in his head, and I don’t know what it is. I know that it’s about culture, but culture’s hard to define.

FN: What have you been doing since you left?
NS: Right after I left, I started a custom apparel line called Stagr, but it was such a cumbersome process on the back end that after a year I shut it down. I just started a new clothing brand, Dethrone, in March. I’m also working on another site called Stylejuku.com, where you can take items from different retailers — Zappos included — and create outfits. We want to turn it into the kind of place where people can go for [personalized] fashion advice.

FN: What advice would you give to young entrepreneurs?
NS: Don’t let your ego get in the way if something is working. Do whatever you need to do to keep moving the company forward and don’t worry about who gets credit or who owns what. That’s one of the reasons everything worked for us. No one at Zappos had a huge ego.

 

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