As the CEO of Amazon Inc., Jeff Bezos earns a little above $1.6 million per annum. The remainder of his massive $186 billion net worth, which makes him the richest man in the world, comes from his stockholding in the company that he founded. The renowned techpreneur previously owned a significant stake in the company that he grew from an online bookstore into an e-commerce juggernaut. However, his shareholding has reduced over the years in part due to his 2019 divorce, which saw him cede 25% of his stake to his ex-wife MacKenzie. Bezos has also voluntarily offloaded some of his stakes in order to comply with Securities and Exchange Commission (SEC) requirements. These sales have racked up tens of billions of dollars for him and he has revealed his plans to deploy them towards philanthropic initiatives. Some would equally go towards his space exploration venture known as Blue Origin.
Jeff Bezos’ Amazon Shares Results To A 10.3% Stake In The Company
As at the time that Jeff Bezos founded Amazon in 1994, he presumably held the whole 100% stake in the company. He later had to cede portions of these to the early investors, including his parents who gave him $300,000, providing the funds with which he grew his company’s operations. More and more ceding continued to happen as the company grew successful and embarked on an IPO as well as an equity offering in 1997. Between 2010 and 2017, Bezos sold a significant portion of his shareholdings resulting in a windfall worth billions of dollars. He equally sold 20,000+ shares for $33 million in 2018.
In 2019, the Princeton alum upped the ante by selling millions of shares and making $2.8 billion in return. The same trend has continued for 2020 and 2021. In February 2020, Jeff Bezos sold $4.1 billion worth of Amazon shares before offloading yet another $3.1 billion worth of shares in August that same year. He then made $3 billion after selling more of his shares in November 2020. For 2021, the Amazon CEO sold $4.9 billion worth of his shares in February and then $1.7 billion worth of shares in May. All these sales have seen Bezos’ Amazon stake reduce considerably. He now retains a 10.3% in the company he founded. This is worth over $170 billion and accounts for him being the richest person in the world.
He Remains the Highest Single Shareholder (Individual or Institutional) of His Company
Jeff Bezos may have sold off a significant portion of his Amazon shares but his remaining 10.3% stake means that he is still the largest single shareholder in the company. He also retains the majority of the voting powers as his divorce agreement specifies that he will still control the voting power in respect of the shares that he ceded to the wife. Bezos is not the only notable individual shareholder that Amazon has. Others in this category include the head of the company’s web service division, Andy Jassy.
Jassy has a 0.02% (94,797 shares) stake in the company and has been announced as the individual who will assume the CEO role when Bezos steps down later in 2021. It, therefore, means that there is a very good chance of his present shareholding increasing when he becomes CEO. Another notable individual shareholder that Amazon has is Jeffery Blackburn who has been with the company since 2008 and has variously served as Vice President of Operations Integration and Senior Vice President of Business Development. He was tipped as one of Bezos’ potential successors but eventually lost out to Jassy. He has a 0.01% stake (48,967 shares) in the company.
Other major investors in Amazon are institutional or corporate investors. The top ten institutional investors that Amazon has are:
- Vanguard Group Inc. (6.10% or 30.74 million shares)
- BlackRock Fund Advisors (3.60% or 18.1 million)
- SSgA funds Mgt. Inc. (3.15% or 15.87 million)
- T. Rowe Price Associates Inc. (3.14% or 15.83 million)
- Fidelity Mgt. & Research Company (2.88% or 14.51 million)
- Geode Capital Mgt. LLC (1.3% or 6.6 million)
- Northern Trust Investments Inc. (0.97% or 4.8 million)
- Norges Bank Investment Management (0.86% or 4.3 million)
- Capital Research & Management Company (0.73% or 3.7 million)
- Capital Research & Management Company (0.62% or 3.1 million shares)
Bezos is Using His Stock Sell-Off To Fund His Space Exploration Company, Blue Origin
One of the major areas where Jeff Bezos is plowing his Amazon billions is his passion project, Blue Origin. Founded in 2000, Blue Origin is dedicated to making space exploration more accessible to ordinary individuals. The company has thus far created a suborbital rocket that will be used to take tourists to the edge of space. They also have plans for another vehicle that they hope to use to land human beings on the moon someday.
Bezos has described Blue Origin as his most important work. It is also known that he will direct much of his time and focus towards the company after he steps down as Amazon CEO. In a further show of the amount of importance that he places on the project, Bezos has majorly fronted the billions of dollars needed to fund the company. The remainder has come from government sources such as NASA and the United States Air Force.
He Has Also Pledged $10 Billion to Combat Climate Change
When compared to other billionaires such as Bill Gates and Mark Zuckerberg, Jeff Bezos has been relatively limited in his philanthropic initiatives. The Amazon founder has also raised eyebrows by refusing to sign the Giving Pledge but he has remedied his public image in recent times.
In February 2020, Jeff Bezos took to his social media accounts to announce the establishment of the Bezos Earth Fund. According to him, the initiative will fund scientists, activists, and NGOs involved in efforts aimed at preserving and protecting the natural world. The Amazon founder committed an initial $10 billion to the fund and it has thus far disbursed about $791 million to 16 organizations. They include World Wildlife Fund – $100 million, World Resources Institute – $100 million, the Natural Resources Defense Council – $100 million, the Environmental Defense Fund – $100 million, ClimateWorks Foundation – $50 million, and the Climate and Clean Energy Equity Fund – $43 million.
Beyond climate, Bezos has also committed millions of dollars to other worthy initiatives such as food banks, scholarship funds for undocumented immigrants brought to America as kids, the establishment of non-profit preschools for low-income communities, and combating homelessness.