• Inc. Magazine, Monday, June 7, 2010 12:11 PM

Tony Hsieh, founder of ecommerce site Zappos, explains how and why the company was sold to Amazon. In short, outside investors were clamoring for substantial returns, the economy was in the dumps, and credit was increasingly hard to come by. "In early 2009, there weren't a lot of banks eager to give out $100 million to a business in our situation," Hsieh writes in Inc. Magazine.

That was all compounded by the fact that the value of Zappos' inventory -- which was "based on the amount of money we could reasonably collect if the company were liquidated -- was fast deteriorating. All in all, "These issues had nothing to do with the underlying performance of our business, but they increased tensions on our board of directors." In the end, as Hsieh describes it, Amazon saved Zappos from its board of directors, which effectively wanted to kill the company's employee-centric culture.

Read the whole story at Inc. Magazine »