Amazon
“This is a company with a powerful corporate culture and an increasingly strong business model” — Duan Yongping (Source: Business Logic, 2019-09-21)
🏢 Basic Information
- Industry: E-commerce / Cloud Computing / Technology
- Duan Yongping’s Holding: Not held (believes he cannot understand the valuation)
- Duan Yongping’s Assessment: Great company, but difficult to value; both corporate culture and business model are impressive
💡 Duan Yongping’s Core Views
1. Shift in Perception: From “Thin Snow” to “Great Company”
Duan Yongping’s view of Amazon underwent a notable transformation. Early on he said: “Amazon? Of course it’s a long slope, but the snow on it isn’t very thick — otherwise how could they sustain losses for 20 years?” — This was his questioning of Amazon’s moat depth.
Later he changed his view: “Yes, my understanding of Amazon has shifted somewhat; I do feel this company’s corporate culture and business model are both impressive. I didn’t have much concept of Amazon’s business model before.” (Source: Business Logic, 2019-06-11)
2. Why didn’t he buy Amazon?
“I know Amazon is a great company, but I also don’t know what it should be worth. However, earning $50 billion or more per year in the future doesn’t seem too difficult for them. Switching back and forth is quite difficult, so better to do less of it.” (Source: Business Logic, 2019-06-01)
Core reason: Circle of competence — if you can’t understand the valuation, don’t buy. This is an embodiment of doing the right things.
3. Amazon’s Moat
Early assessment: “Amazon? Of course it’s a long slope, but the snow on it isn’t very thick — otherwise how could they sustain losses for 20 years?” — This shows that Amazon’s moat was built through long-term investment and scale effects, not deep from the start.
Later assessment: “This is a company with a powerful corporate culture and an increasingly strong business model; earning over $50 billion per year in the future is highly probable.” (Source: Business Logic, 2019-09-21)
4. Amazon vs. JD.com
“Amazon is good, but US logistics environment is good. JD needs to build its own logistics, which I’m somewhat uncertain about… Amazon seems to be much stronger in the future. Also, Bezos almost always goes home to eat and wash dishes.” (Source: Business Logic)
❓ Selected Q&A
Q: What do you think about Amazon?
A: I know Amazon is a great company, but I also don’t know what it should be worth. However, earning $50 billion or more per year in the future doesn’t seem too difficult for them. Switching back and forth is quite difficult, so better to do less of it. (Source: Business Logic, 2019-06-01)
Q: What’s your take on Amazon’s business model?
A: Yes, my understanding of Amazon has shifted somewhat; I do feel this company’s corporate culture and business model are both impressive. I didn’t have much concept of Amazon’s business model before. (Source: Business Logic, 2019-06-11)
Q: What about Amazon’s valuation?
A: Look at how much it can earn in the future; if you can’t understand it, don’t touch it. My current view on Amazon: this is a company with a powerful corporate culture and an increasingly strong business model; earning over $50 billion per year in the future is highly probable. (Source: Business Logic, 2019-09-21)
💬 Original Quotes
“Amazon? Of course it’s a long slope, but the snow on it isn’t very thick — otherwise how could they sustain losses for 20 years?” — Duan Yongping (Early assessment, Source: Business Logic)
“I know Amazon is a great company, but I also don’t know what it should be worth. However, earning $50 billion or more per year in the future doesn’t seem too difficult for them.” — Duan Yongping (Source: Business Logic, 2019-06-01)
“Yes, my understanding of Amazon has shifted somewhat; I do feel this company’s corporate culture and business model are both impressive. I didn’t have much concept of Amazon’s business model before.” — Duan Yongping (Source: Business Logic, 2019-06-11)
“This is a company with a powerful corporate culture and an increasingly strong business model; earning over $50 billion per year in the future is highly probable.” — Duan Yongping (Source: Business Logic, 2019-09-21)
📚 Investment Insights
- Only buy what you understand: Even for great companies, if you can’t understand the valuation, don’t buy — this is the boundary of circle of competence
- Perception can change: Duan Yongping’s view of Amazon shifted from “thin snow” to “corporate culture and business model are both impressive,” showing that circle of competence can expand
- Moat takes time to verify: Amazon built its moat over 20 years of losses — not something visible at first glance
- If you don’t understand, don’t touch: Duan Yongping knows Amazon is great, but because he couldn’t understand the valuation, he didn’t buy — this is the best embodiment of doing the right things
🔗 Related Notes
Related Concepts Circle of Competence · Business Model · Moat · Doing the Right Things Related People Duan Yongping Related Companies Apple · Tencent · Moutai · Alibaba Related Topics Duan Yongping’s Value Investing System · How to Judge a Good Company