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Venture capitalist Tom Alberg. (GeekWire file photo)’s famously close-mouthed ways go back all the way to its IPO or further, says Tom Alberg, the online-retailing giant’s first investor and first board member. Alberg, a co-founder of Seattle’s Madrona Venture Group and still a member of Amazon’s board, sheds light on the company’s mindset in a new episode of the “Acquired” podcast that delves into Amazon’s history, IPO and evolution as a company.

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Around the time of the IPO, in May 1997, Amazon entered the SEC-mandated quiet period, halting the vigorous PR and marketing efforts Amazon had been making until then, said “Acquired” hosts Ben Gilbert of Pioneer Square Labs and David Rosenthal of Madrona. At that time, “we did get some criticism then, and even today, on how much we disclose beyond what the securities laws and NASDAQ require,” Alberg said.

He elaborated:

You disclose everything you have to, but there’s always this sort of area, well, “What’s the cost of a customer? And how many customers do you have, and how fast is books growing vs. video?” And Amazon’s always felt that that’s proprietary. They don’t want to let their customers know. . . . . I think maybe bricks-and-mortar retailers, do they release monthly sales numbers or something? You at least see them. So there’s always been a little bit of tension with the analysts wanting more and feeling, you know, it’s only going to help our competitors.

Beyond keeping the data from customers and competitors for competitive reasons, Amazon does so to avoid needless worrying among investors, Alberg said.

“They also don’t want people focusing on what are in some ways short-term small things that will work out in the long term,” he said.

He explained:

Amazon has been rightly known for not making any money and being willing to invest, to the extent that the financial markets allow you to. If (the company) had been in the hands of an acquiring party (rather than going public), you would not have seen this kind of growth and then innovation and expansion. Jeff has had a unique ability to think long-term and make it clear he’s thinking long-term, so the investors understand this is a long-term investment. He likes to say you get the investors you ask for, meaning that if you focus on 2 cents more profit per quarter, then you get investors who focus on that. It takes you awhile to get the right kind of investors, but if you say long-term cash flow is how we measure the business, pretty soon you get investors who are willing to invest on that basis.

Amazon keeps tight control over information on fledgling projects including drone delivery, bricks-and-mortar grocery stores and a possible chip-making operation in Israel.

In press releases and during quarterly earnings calls with analysts and reporters, the company tends toward generalities or percentage increases rather than specifics and numbers when talking about important metrics, such as the number of Prime members. And Amazon has banned recording, typing and photography at its shareholder meetings, even while founder and CEO Jeff Bezos comments, “I never think of us as secretive. We’re just quiet.”

Listen to the full interview with Alberg on the latest episode of the Acquired podcast.

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