Could Amazon Buy A Country?

I read a news story today about Amazon now employing more than 500,000 people.

More than 500,000 people are employees of Amazon. When you count all the people who make their livings through stores on Amazon, by delivering Amazon products, by making the boxes Amazon ships their products in, or constructing the warehouses Amazon uses to store all the products, that number would easily be over a million.

[REITs]

See 2017 Hedge Fund Letters.

Amazon has more employees than a lot of countries have people (they would be the 171st most populated country in the world).

It is astounding to think about the initial entrepreneurial insight of Jeff Bezos having that type of impact, and it leads me to think about how, if they continue to grow, they could legitimately start their own country.

Could Amazon Buy a Country?

Amazon has been in the news lately for shopping around for a location for a second headquarters. It looks like they will be going to Virginia, nice and close to Mordor. But what if they decided that instead of buying a headquarters in the US, they would start their own country?

It may make financial sense to buy their own sovereignty instead of putting up with a parasitical government that tries to regulate them out of existence.

Last year, Roger Ver and a few others announced a project called FreeSociety, with the aim of purchasing sovereignty from an existing country. They haven’t announced how much money they have, but it will likely be in the low single-digit billions. As of Q1 2017, Amazon had $22 Billion cash.

I don’t know what the P/E ratio of a country should be, but $22B is 15 times the GDP of Saint Kitts and 50 times the GDP of Sint Maarten. They could legitimately find a government that is struggling with debt and offer to buy half the land in the country with a condition of being recognized by the government as a sovereign nation.

It seems crazy to think about, but it would save Amazon a ton of taxes if they could set their own tax policy for a headquarters, and even if it’s not Amazon, there are a handful of other companies that are big enough to make it happen—Apple had $256 Billion in cash as of Q1 2017.

For Apple and Amazon, who both do a lot of physical business, the costs of headquartering a business outside of the US are likely too high, but for titans of the cryptocurrency economy of the future, it may make financial sense to buy their own sovereignty instead of putting up with a parasitical government that tries to regulate them out of existence.

Reprinted from the author’s blog.