Crown Prince of the City

At Zappos, Tony Hsieh built a business on the principles of quirky unity and planned serendipity. Can he use the same principles to reshape downtown Las Vegas?


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tony-hsieh

The Downtown Cocktail Room’s doors are impossibly un-door-ish. You walk up from the intersection of Fremont Street and Las Vegas Boulevard, happy to join the buzzing downtown camaraderie—the urban revolution taking hold of Las Vegas—and you’re faced with walls of one-way glass and no apparent door handle. For the uninitiated, it makes for an awkward moment. Had this happened to me, and I’m not confirming that it did, the larger metaphor wouldn’t have been lost: Maybe everyone doesn’t fit in here.

The bar is bohemian-sophisticated, laid-back but purposefully designed. Relaxed, but self-aware. Tony Hsieh is here tonight. He is 38, buzz-cut, serene. He’s arrived with a couple of friends. They’re not showy, not chic, just smart guys downwardly dressed in jeans and button-ups, planning to overhaul a major metropolitan core for fun and profit and to fulfill their larger sense of life purpose.

As CEO of Zappos, an online retailer specializing in footwear, Hsieh (pronounced Shay) is at the helm of more than a successful company. Since announcing in November 2010 that Zappos would move from a Henderson office park to the old Las Vegas City Hall on Stewart Avenue and Las Vegas Boulevard, he has become the central personality in Las Vegas’ burgeoning downtown revitalization movement. The move—the first steps of which take place in April—will infuse a couple thousand unusually enthusiastic employees into an area that has seen renewed energy in recent years after decades of stagnation.

Hsieh and Zappos employees began working on new ideas for downtown as soon he made the announcement, drawing media attention nationwide to a potential corporate-community revitalization model—an especially exciting concept in a down economy. As we wait for the story to play out, big questions remain: What’s unique about Hsieh’s vision, and how will it translate into a new model of downtown revitalization?

Hsieh’s group gets a big table at DCR, prepared for others to join them. Soon Hsieh’s longtime friend and business co-conspirator Jenn Lim shows up, petite, stylish. She knows how to open the door. More young guys, more young women, the door is swinging now. In walks a visiting worm farmer, an older man, whom Hsieh met earlier in the day at a UNLV seminar. Here comes Michael Cornthwaite, the owner of the bar and one of this generation’s downtown pioneers. The crowd at the table grows and grows and grows. Chairs are added, people begin to hover, the drinks flow, the noise rises and, as will happen in a happening bar, their conversation begins to drown out other conversations. Their scene begins to crowd the small adjacent table where my friends and I sit. Ultimately, we will need to decide whether to join them, or to move along.

I say hello. Hsieh is mellow and friendly. We have met before, but I can’t be sure he remembers. Nevertheless, he shakes my hand and kindly sets me up to talk with Lim. He does that: quietly manages the group, makes sure everyone is talking to someone, all the while sipping his Grey Goose and thinking about doling out happiness and urban revitalization, about putting Henderson suburbia behind him and growing his tribe in downtown’s Ogden condominiums—where he has made his home on the top floor since last summer—and about attracting highly educated workers to Las Vegas from cultural meccas such as San Francisco and Seattle.

Lim talks about the possibilities of creating a vertical urban garden here. Coincidentally, I have just watched a documentary about urban gardening. Odder still, we happen to be sitting next to the worm farmer, who joins the conversation. Now we’re getting real traction, and the topic begins to grow on its own, and the busy bar scene itself feels like fertile soil for amazing ideas. Something about all of this serendipity feels extraordinary.

•••

Hsieh is the oldest son of Taiwanese immigrants. His father worked as a chemical engineer and his mother as a social worker. He grew up in upscale Marin County, Calif., a precocious child and a natural entrepreneur. He sold Christmas cards door-to-door, ordered a button-making kit to sell pin-on shirt buttons, and created his own newsletter (you could buy a copy for $5 or a full-page ad for $20). He started a worm farm at the age of 9 with the intention of capitalizing on their quick reproduction rate.

Nevertheless, the encounter with a worm farmer almost 30 years later in Las Vegas is serendipitous, and Hsieh strongly believes in serendipity, although he goes out of his way to arrange it, which could be interpreted as taking the sheen off of true serendipity. Hsieh says this a lot these days: “I want to increase the number of serendipitous interactions of our staff, inside and outside the firm.” You see his serendipity at work everywhere now; the Zappos brand is prominent in Vegas, to say nothing of the Zappos mystique that has captured the imagination of downtown boosters, city councilmen and two Goodmans. Hsieh doesn’t wait around for serendipity to find him.

In his 2010 book, Delivering Happiness—copies of which he’s made available for free in downtown businesses and at First Friday—he describes himself as a bit of a rebel, always trying to beat the system. When his parents made him take piano and violin lessons, he recorded himself practicing and then played it back while they were in other rooms, so that they’d think he was practicing when in fact he wasn’t. In school, when he was assigned to write a sonnet but felt uninspired by the rules of iambic pentameter, he turned in 14 lines of Morse code, and was rewarded with an “A+++++.”

“I started making deals with my teachers in which they agreed to let me not attend their classes as long as I did well on their tests,” he writes.

Once, he was falsely accused of stealing someone’s lunch card in high school and was suspended. “I walked away from that experience with the lesson that sometimes the truth alone isn’t enough, and that the presentation of the truth was just as important as the truth.” It was a key lesson in marketing, and in psychology, that would play out in years to come.

In 1991, Hsieh entered Harvard, where he continued to create ways to work smarter rather than harder. In a humanities class about the Bible, he created a virtual study group for profit. He had fellow students summarize portions of the assignments rather than read everything, and then he collected their work, bound the complete guide and sold it back to them for $20 each. He also sold pizza at his dorm.

In 1995, he fell in love with the Internet, and as he approached graduation, he started looking for jobs in the booming technology field. “My goal was to find a high-paying job. I didn’t really care what my specific job function was, what company I worked for, what the culture of the company was like, or where I ended up living. I just wanted a job that paid well and didn’t seem like too much work.”

He found it at Oracle, a computer hardware and software developing company. His job was to run a few computer tests every day, which didn’t consume his entire 40 hours, and he discovered that much like piano lessons and Harvard classes, no one really monitored whether he was in his chair or not—so he often was not. In his plentiful spare time, he and a friend started an Internet marketing company, but they soon realized that they didn’t like making sales calls or doing Web design. So they came up with the idea for LinkExchange, an Internet business that rewarded member websites with banner advertising proportionate to their number of page views.

“Within a week, we knew that our project that was initially meant to fight boredom had the potential to turn into something big,” he writes in his book.

And so it did. Less than three years later, they sold it to Microsoft for $265 million. He was 24. In the aftermath, he discovered an entire city block in downtown San Francisco that had loft space up for sale—and in a little foreshadowing of his predilection for live-work-play culture that would one day be apparent at Zappos and on East Fremont, he persuaded his friends to join him in buying live-work space.

“I thought back to my college years, where there was a core group of us who always hung out together. We could create our own adult version of a college dorm and build our own community. It was an opportunity for us to create our own world. It was perfect,” he writes. “One by one, our crew started moving into the lofts. … By the time all of us had moved in, we collectively owned 20 percent of the lofts in that building and controlled 40 percent of the board seats of the homeowners’ association. It was like we were playing our own private real-life version of Monopoly. And nothing could compare to the spontaneity and convenience of being able to stroll over in pajamas to a friend’s place or the movie theater.”

Hsieh and the VP of finance at LinkExchange, Alfred Lin, started a venture capital company called Venture Frogs and in 1999 invested $500,000 in a startup San Francisco-based e-commerce shoe retailer, Zappos—which was initially called ShoeSite.com. They nursed Zappos to profitability in that loft space, and in 2000, Hsieh decided to go from investor to CEO.

In 2004, looking to grow the call center, Hsieh moved Zappos’ corporate headquarters from San Francisco to Henderson. By 2009, he had turned Zappos from a startup to a company with more than $1 billion in sales annually, and in 2009, it was acquired by Amazon for $1.2 billion, leaving Hsieh in place as CEO.

•••

Hsieh’s managerial philosophy—and his philosophy of life—was shaped in part by a life-altering experience at a rave more than a decade ago. He was a 26-year-old self-made millionaire, a smart kid from a disciplined home, a Harvard graduate for whom boredom was among the biggest challenges. The rave, with its PLUR (Peace, Love, Unity and Respect) atmosphere, introduced him to the big idea he continues to pursue to this day:

“As someone who is usually known as being the most logical and rational person in the group, I was surprised to feel myself swept with an overwhelming sense of spirituality—not in the religious sense, but a sense of deep connection with everyone who was there as well as the rest of the universe,” he writes in Delivering Happiness. “The entire room felt like one massive, united tribe of thousands of people, and the DJ was the tribal leader of the group. …

“It was as if the existence of individual consciousness had disappeared and been replaced by a single unifying group consciousness, the same way a flock of birds might seem like a single entity instead of a collection of individual birds. Everyone in the warehouse had a shared purpose.”

What exactly that purpose was may not have been clear to Hsieh or anyone else in the room. You’re going to see the unity concept at work in Zappos, though, and eventually in downtown Las Vegas, where Hsieh has positioned himself as the philosopher-prince of the urban core. But don’t forget that this is also a story about business, about real-life Monopoly.

•••

In 2002, the urban analyst Richard Florida published The Rise of the Creative Class, a best-selling book about how the number of people in “knowledge-based” jobs were the best predictors of cities’ economic futures. Florida defined the creative class as scientists, engineers, architects, poets, university professors—jobs that require a higher level of education, use creative processes in their jobs, and have the propensity to identify with a bohemian, noncomformist lifestyle.

Las Vegas did not rank well. In fact, it sat in the bottom 10 of 49 metropolitan areas with more than 1 million people in the 2000 Census. Las Vegas’ “creativity index,” calculated by things such as the percentage of high-tech workers and gay people, was 561 compared with San Francisco’s 1,057.

Florida then wrote depressingly of areas with a high concentration of service-industry workers, like Las Vegas, “Few of these cities boast any significant concentrations of the creative class, save vacationers, and offer little prospect for upward mobility.”

About that same time, Hsieh and his gaggle of friends at Zappos had run into the flip side of the creative-class problem: “In San Francisco, we were having a hard time finding people who wanted to work in our customer-service department,” he writes in Delivering Happiness. “Even when we could hire good people, we discovered that most of them viewed customer service as a temporary job. … Part of the problem was the high cost of living, and part of the problem was the culture. Working in a call center just wasn’t something that people in the Bay Area wanted to do.”

So Zappos moved to an office building in Henderson, paid less than industry standard wages for a U.S. call center, and grew the company at breakneck speed by offering something more than shoes to customers, and more than money to employees: culture.

For customers, it was a no-script variety of personal service that allowed for 24/7 communication, quick delivery, easy returns and quick problem-solving. Zappos, as Hsieh has said in innumerable interviews, is a customer-service company that sells shoes, not a retail company with customer service.

For employees, Hsieh and his core group of young, casual executives would offer a work culture like no other: a big, artsy family who could wear pajamas to work if they were so inclined. And what better place to offer a sense of belonging, creative freedom and perceived career growth than a transient metropolitan area constantly struggling with its lack-of-community vibe and small arts culture?

•••

What, then, is the culture that Hsieh has become famous for cultivating? The culture that is already spreading to downtown, but will ultimately have a huge presence there? Zappos offers free public tours to answer that.

Upon arrival at the boxy office complex off Green Valley Parkway and Interstate 215, I look for a parking space in the sprawling, crowded lot—some 1,200 people work here now. There’s an empty spot up front reserved for the “Master of WOW,” whoever that is, so I park a few slots over. Inside the glass doors, there’s hubbub from the get-go; bubbly workers at the front desk joke and sing, take my name and give me a name tag, and leave me in the small waiting area to peruse shelves full of books devoted to the subject of happiness.

The science of happiness became an area of interest to Hsieh after that long-ago rave, and he encourages his employees to borrow these books at their leisure. Zappos also offers Science of Happiness classes to employees. Happiness, Hsieh concludes in his book, is about four things: “perceived control, perceived progress, connectedness (number and depth of relationships) and being a part of something bigger than yourself.”

A good dozen people show up for the tour. Some are business executives who came to Nevada specifically to see Zappos; others are vacationers who heard it was cool. I can’t help but feel a little like the privileged golden-ticket party at the gates of Willy Wonka’s Chocolate Factory when we are led inside to watch a short video on Zappos’ history; there’s a hushed buzz among us in anticipation of seeing something revolutionary.

“Everybody that works here is called a Zapponion,” our tour guide, Miguel, says as he leads us down the hallway from the video room toward the famous rows of decorated cubes where employees work. We pass a nap room, where staffers can rest on their breaks. We learn that during a training period, new employees are offered $3,000 to quit, a game of chicken to test one’s devotion. (Less than 1 percent of trainees took the offer in 2011.) Then we walk into the call center—an overgrown dorm commons, as promised. As we pass each section of cubes, a team stands up with some kind of noisemaker—maracas, whistles, whatever—and greets us with a tune and a smile and a wave and a hello. There are inflatable bananas and Nerf balls, fake trees and Mardi Gras beads. Everywhere.

Miguel is not particularly bouncy or goofy, in odd contrast to his surroundings. He’s noticeably earnest when he delivers these corporate lines: “We’re all about creating fun and a little weirdness here,” and “We deliver happiness.” He says them both twice during the tour.

Like all Zappos employees, he wears an ID badge around his neck that has the 10 Core Values on it. He refers to several of them on our walk through the free employee cafeteria and down a hall with plaques and pictures and through a stairwell where graffiti is encouraged, and prolific: Be a Positive Team and Family Spirit, Create Fun and a Little Weirdness, Deliver WOW Through Service.

Further along the tour, after we take turns sitting in a giant throne with a king’s crown on our heads for photos, an employee introduces the group to The Mayor of Zappos, a seemingly random employee who offers “free hugs.” One member of our tour takes him up on it. This mayor, who skews old for a staff whose average age is 33, is slightly less of a ham than Las Vegas’ previous mayor, Oscar Goodman, but perhaps a touch more than the current mayor, Carolyn, both of whom gush over Hsieh’s potential impact downtown.

More than 500 of these employees are customer-service reps making about $14 an hour, Miguel tells us. Upon pre-employment interviews, there are tests for cultural fit. It’s more important than anything else in the hiring process, he says, a point that Hsieh repeats everywhere I see him in the next few weeks—on ABC’s 20/20 and at a presentation at the Vegas Valley Book Festival. They’re looking for people who will get along and participate in the Zappos culture, who will uphold the core values: Create fun and a little weirdness. They will be offered personal and professional development in their Zappos tenure, including in-house courses such as: Tribal Leadership, Public Speaking and Intro to Coaching along with Intro to Finance, HR 101, Grammar and Writing 1 & 2 and Time Management.

Zappos is looking for people who will, upon being hired, answer the following question with a yes: “I believe that the company has a higher purpose beyond just profits.” That purpose, it turns out, may end up having something to do with the core of Las Vegas; it may also have something to do with Hsieh’s meaning of life, group over self. Hsieh tells me later that the biggest turnoff when considering a new hire is ego. Zappos wants its employees to be humble, he says.

The atmosphere here is created to be fun, and without a doubt, people seem to be having fun while doing their jobs. And the company has wildly devoted consumers who post accolades on its Web page. But what’s notable to me about the culture isn’t so much the fake palm trees and kazoos as the sense that its spirit is ubiquitous—a homogenous desire to be quirky. You get figurative points, as a Zapponian, for coming to work with mismatched socks and creating a bowling alley near your cube. The culture is intentionally whimsical—rule-breaking by careful orchestration.

After an hour in the office party of Zappos culture, I longed for the peace of the nap room. However, I have to admit I admired the office culture nonetheless. In spirit, it seems better than the maniacal sameness of veal-locker cube culture everywhere else. And I see the extended comparison of New Urbanism versus suburbia, too—color and quasi-serendipity versus HOAs and matching foreclosed houses.

But I can’t help but wonder: What if you don’t want to decorate your cube?

•••

I meet with Hsieh in a tiny room off the main call-center floor, decorated with strategically mismatched furniture. He’s soft-spoken and confident, pleasant but not the direct reflection of the ebullient cube life.

“Zappos definitely isn’t for everyone,” he says. “Like for people that want a clear separation from work and life, we’re not the right place. If you’re uncomfortable having drinks with your co-workers, we’re not the right environment for you.”

Earlier, when I was left to wander by myself in the building—an admirable nod to the policy of transparency—I asked an employee about the social pressures. She’s very pro-Zappos and likes her job, but, she confessed, sometimes she doesn’t want to socialize with the same people she works with. Still, she reiterates, it’s a great place to work.

Most others profess a familial devotion. Every year the company puts together a yearbook in which employees say what they want to say, and many tell tales of how the community at Zappos turned their lives around, or saved them in times of trouble. One woman talks about how she relied on her Zappos family after her husband died, and how they catered the reception after his memorial service and always lent a shoulder for her to cry on.

This, Hsieh says, is just what true friends do for each other; it’s not something the company has to coach because they’ve hired right.

They’ve selected only those who naturally fit in with the cultural goals, a select type, and many of the employees with the Core Values around their necks and smiles on their faces stop to tell the tour group how much they love it here. There are parties, they say, free lunches and group outings—recently a bunch went zip-lining together; another gang meets downtown for drinks all the time.

I ask Hsieh about the tight-knit feel, and the quirky, dorm-style atmosphere—does he ever get sick of it? He has a cube here, too, although he’s not seated in it as regularly as his colleagues. No, he says, he loves the atmosphere. Hsieh is single, and a sort of post-collegiate social density still comes naturally to him—it’s the life of the young Silicon Valley generation, for whom the notion that home should pull one away from work is odd, because work is home. I ask if the company prefers to hire young people, whether the zaniness appeals more to the 20-something set. He says no, age isn’t a requirement to work here, but that younger people do tend to share the Zappos values more often; that is, they more frequently want to put effort into expressing weirdness or to hanging out in bars and sleeping in the Zappos crash-pad on the top floor of the Ogden.

Still, he says, everyone who adopts the values and does the work can remain employed here. I get the sense that he truly sees his company’s cultural values as beneficial to individuals beyond their jobs—which is where this business story takes on the feel of a social experiment, fueled by a belief in evangelical happiness.

•••

Last year, Hsieh was still living in suburban Southern Highlands, and Zappos was growing beyond these three buildings in suburban Green Valley.

“Basically, someone introduced me to Michael Cornthwaite and Downtown Cocktail Room,” he says, “and myself and a few other Zappos employees just started hanging out there. And it worked out perfectly.”

He loved the energy that Michael and Jen Cornthwaite and others were putting into revitalizing downtown; the then-new Emergency Arts and The Beat coffeehouse, the renewed popularity of the El Cortez and the ongoing music scene at Beauty Bar; the laid-back drinking at The Griffin and the arcade-bar vibe at Insert Coin(s).

On those first redeveloped blocks of East Fremont, there’s a cleaner, more stylish, safer, more commercially viable, slowly gentrifying area where accidental street people, prostitutes and the destitute are being replaced, in theory, by a growing creative class. A new brand for downtown Las Vegas is being cultivated: authentic, full of offbeat artists, musicians, the literati, the techno-savvy, longtime locals and in-the-know newcomers. It’s the antithesis of the imposter-driven glittery showcase of the tourist-trap Strip, and more organic than previous attempts to revive downtown, such as the suburban-style shopping center Neonopolis.

Authenticity is the buzzword for many cities’ downtown revitalization efforts, a sort of co-opting of bohemian independence and dissent to make a live-work space that’s commercial but still organic, a place associated with alternative culture and diversity but not opposed to the notion of an anchor corporation to infuse dollars or a police patrol to cap the potential extremes of authentic downtown experiences.

The same can be said for Zappos culture and branding, to a degree: authentically quirky by design. As Hsieh writes in Delivering Happiness: “A company’s culture and a company’s brand are really just two sides of the same coin.” So it seemed concordant, or serendipitous, when Hsieh heard about the city’s plans to vacate City Hall at the same time he was dealing with Zappos overflowing in Henderson.

“I don’t follow local politics at all, or even regular politics. So I didn’t know the city was moving. I randomly found out about that. So I looked into it more, and the current City Hall is like perfect for us,” Hsieh said. Cornthwaite and other downtown business owners worked to make the deal happen, lobbying Hsieh and the city to adopt a vision of a renewed downtown, anchored by Zappos.

Zappos will lease the space from Resort Gaming Group, which will pay the city $18 million for the building (down from an initial price of $25 million). At the City Council’s Dec. 1, 2010, discussion of the impending move—a meeting now set to touching music on YouTube—council members expressed unalloyed joy:

Mayor Oscar Goodman: “Today is a transaction which is going to affect forever the social fabric of our community. The way we think about ourselves and our inner core will be different from this moment forward. We have been validated today. We’ve been legitimated. … We’re major league.”

Councilman Gary Reese: “From my heart, this is big. … Mr. Hsieh, thank you very much.”

Councilman Steven Ross: “The values of downtown properties have just changed, in just a conversation today at this meeting.”

Goodman: “There are certain watershed moments … and this is one of them.”

To applause, Hsieh came to the podium and joked, “Mr. Mayor, I think you’re sitting in my future seat.”

After the announcement, Oscar Goodman issued another statement: “This will be a game-changer for Southern Nevada. This move will bring about a critical mass of creative persons to the inner core of Las Vegas in addition to causing a significant shot in the arm for the economy and for new jobs.”

Seven months later, 200 employees in Zappos T-shirts bused down to conduct a flash mob at a City Hall meeting to honor Goodman as his tenure came to an end. They blasted electronic music and performed a choreographed dance, even getting the mayor himself to do a few moves.

•••

At first, Zappos planned just to amp up the culture inside its new building, Hsieh says, maybe add a bar inside the office, or a zip-line. But then, with the enthusiasm whipped up by the council, downtowners and the media, the idea grew.

Zappos culture would be more than a business environment. Employees would become a driving force, Richard Florida’s missing creative class that’s needed to fuel a vibrant downtown. They would take on projects—urban gardening, day care, high-tech incubators, education and music “tracks” to improve the community. In Hsieh’s office atop the Ogden, there is a wall of Post-Its, a mosaic of ideas to be implemented. A recent one read, simply, “Ice Cream Shop.”

“It’s an interesting experiment,” says Steven Pedigo, an analyst with Richard Florida’s Creative Class consulting group who came here last spring with Florida to meet with Hsieh and the mayor about it. “But let’s be honest: At the end of the day it’s a call center. But they’ve taken those service jobs and transformed them into something more creative.”

Truth is, a growing number of computer programmers, designers and other creative-class employees work at Zappos. And the reality isn’t as simple as relying on Zappos call-center employees to revive a metropolitan core. But that storyline—a boon to Zappos marketing—was written the day Zappos and the city of Las Vegas announced their real estate deal, recalling a lesson Hsieh learned in high school: The presentation of the truth is just as important as the truth.

“Of course, [Hsieh] is not doing this single-handedly,” Pedigo says. “It’s not one person. A lot of these folks put a stake in the ground earlier than Tony. These [downtown] folks are really passionate. But the buy-in within his workforce community is incredible. They’re serious about their hopes and desires, about the impact they’re going to have downtown.”

And key downtown players speak positively about Hsieh and Zappos; there is little vocal dissent—everyone’s flying the same direction here, except perhaps a few owners of weekly motels on East Fremont whose residents have complained of loud music at the new bars. But overall, Hsieh is pouring money into local arts, businesses and real estate, and he’s repurposing infrastructure at places such as the Ogden and City Hall. He hopes to raise the standard of living and playing downtown. So, what’s there to complain about?

•••

The idea that serendipitous experiences are reserved for the like-minded within an approved structure seems reasonable for a business—but Hsieh is clear that his philosophy is not meant to be applied exclusively at work. In fact he eschews the work-life division, and says that’s where so many companies go wrong.

Hsieh’s philosophy is evangelical—delivering a culture of happiness as he defines it, not keeping it within one’s own walls. And if you don’t buy in, then maybe it’s time you move along. Maybe that’s how this business model applies downtown. If the conversation has gotten too loud, and is taking over your table, maybe you should join in. If the music at the Fremont East bars is too loud, and you live in a nearby weekly motel and can’t sleep, perhaps it’s time to move elsewhere. That’s what hordes of downtown revitalizers wearing “Keep Downtown Loud” T-shirts told the longtime owner of the Downtowner Motel at a city meeting at El Cortez on Sept. 27: Get with the program, or get out.

In the end, economics dictates both the Zappos and downtown cultures, and people and places that do not fit in will be driven out, for better and worse, and where they will go isn’t a concern, because after all, this is capitalism. It only looks bohemian. That’s good branding. This is a business story, remember, even when it starts to feel like a story about a social movement fueled by a spiritual belief in unity.

I ask Hsieh about his spiritual beliefs. He says he was not raised in a particular faith, and does not subscribe to an organized religion—but that he does have some beliefs that bear on his life’s work:

“It’s a complicated question in that I don’t believe in how each religion has its own definition of God, so I don’t believe in [spirituality] from a religious perspective. But I believe that things have emergent properties, and so, for example, the individual cells in your body have no idea of your consciousness, and yet you assemble enough of them together and there’s the consciousness that forms. But any one of your cells is incapable of comprehending that there’s actually a consciousness that is the combination of everything.

“So, for all we know, all humans together, maybe there’s some global consciousness that we’re unaware of and aren’t capable of detecting, just like a cell can’t detect a single person. And that can just go up however many levels, so maybe there’s some emergent property of consciousness in the universe that I wouldn’t call God, but some might call it spirituality. And spirituality, one way you look at it, from a psychology perspective, is it’s basically about being part of something that’s larger than yourself. …

“This evolved over the years. But it’s like a flock of birds; there’s no leader bird. The whole flock looks like its own organism.”

Hsieh’s spiritual beliefs are aligned with his studies of the psychology of happiness. The more he grew Zappos as a culture-first business, the more it became apparent to him that his business was larger than getting shoes to customers, or even delivering positive customer service, or even drawing big revenue. It was to deliver happiness through the positive force of a single mass culture, “properly aligned.”

As he toured the nation giving talks about his business model, he began to realize “that we could change the world not just by doing things differently at Zappos, but by helping change how other companies did things.” Zappos could “contribute to the happiness movement to make the world a better place.”

To this end, employees of another Hsieh company, Delivering Happiness LLC, got a big charter bus and went on a nationwide evangelical happiness tour/book tour/marketing tour this year. They made a song and a video about it that Hsieh showed at companies they visited and at the Vegas Valley Book Festival in November.

On the one hand, it’s brilliant marketing—bottling happiness is smarter than bottling tap water. On the other hand, it’s off-putting to those who cringe at any sort of groupthink. But in the end, the culture will be judged by growth in the downtown economy.

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Las Vegas could do a lot worse for a crown prince of the knowledge economy. Everywhere you look, Zappos’ presence is growing in Vegas. There was the Zappos-sponsored marathon earlier this month; there are miles of Interstate 15 adopted by Zappos employees for clean-up.

There are dozens of Zappos-employee-driven downtown projects, including educational efforts (perhaps based on a virtual school model, perhaps a charter providing daycare or summer camp); a technology incubator with a tech library and hacker space so people can tinker with software and build robots; urban vertical gardens where neighbors can grow their own organic food; bike sharing; dog parks; more arts and music recruiting and producing; and affordable housing.

Plus, Hsieh and partners bought the First Friday business entity from the struggling nonprofit Whirlygig Inc., allowing them to swoop in and fund the monthly downtown arts and culture celebration. They’ve also given grants to artists and are helping start-ups move to town—in some cases, right into the partnership’s space in the Ogden. Several new companies are planning to move to downtown Las Vegas encouraged by or financially helped by Hsieh, such as Santa Monica, Calif.-based EcoMom.com and New York-based Slice pizza. Hsieh’s even formed a company that will help companies open their doors here: Downtown Project will provide accounting and payroll services.

“The goal is to bring a real sense of community and culture,” Hsieh says. “I almost hesitate to use the word ‘community’ because it’s such a buzzword to a city that’s the antithesis of all that.”

Pedigo and urban planners and businesses outside of Las Vegas are keeping an eye on the Zappos-downtown model, which is seen by some as prescient. Pedigo says, “A lot of CEOs have a passion for a cause. There’s a real passion for [downtown] for [Hsieh], and he sees this as about more than just corporate social responsibility. He sees it as a shared community.”

Still, Hsieh is aware that it could be a business-community revitalization model that’s used as a template worldwide. “Part of what’s exciting is that if we can make it work in Vegas, of all cities, and also want to share with the world what works and what doesn’t, that can hopefully inspire other cities to do that and avoid some of the mistakes I’m sure we’ll make along the way,” Hsieh tells me.

“We’ve had great support, and part of what I love about this project is that the local residents want it, the local businesses want it, the city wants it, we want it, so everyone’s just aligned and supporting each other,” he says, walking me to the door of the Zappos Henderson campus and handing me a free copy of Delivering Happiness.

“There’s just so much energy that comes out of that.”

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