The Everything Store: Jeff Bezos and the Age of Amazon

by Brad Stone

As a result of Bezos’s meeting with Lore and Bharara, Amazon now had an exclusive three-week period to study Quidsi’s financial results and come up with a proposal. At the end of that period, Krawiec offered Quidsi $540 million and said that this was a “stretch price.” Knowing that Walmart hovered on the sidelines, he gave Quidsi a window of forty-eight hours to respond and made it clear that if the founders didn’t take the offer, the heightened competition would continue. Walmart should have had a natural advantage in this fight. Jim Breyer, the managing partner at one of Quidsi’s venture-capital backers, Accel, was also on the Walmart board of directors. But Walmart was caught flat-footed. By the time Walmart upped its offer to $600 million, Quidsi had tentatively accepted the Amazon term sheet. Mike Duke called and left messages for several Quidsi board members, imploring them not to sell to Amazon. Those messages were then transcribed and sent to Seattle, since Amazon had stipulated in the preliminary term sheet that Quidsi was required to turn over information about any subsequent offers. When Amazon executives learned of Walmart’s counterbid, they ratcheted up the pressure even further, threatening the Quidsi founders that “sensei,” being such a furious competitor, would drive diaper prices to zero if they went with Walmart. The Quidsi board convened to discuss the Amazon proposal and the possibility of letting it expire and then resuming negotiations with Walmart. B...