Mark Lori is the serial entrepreneur behind Diapers.com and Jet.com, two major e-commerce ventures that directly challenged Amazon's dominance. A former derivatives trader at Bankers Trust who became the youngest executive vice president at age 28, Lori left finance in 2000 to pursue entrepreneurship. His journey included an unexpected detour as a member of the U.S. national bobsled team before launching multiple successful startups.

The conversation covers Lori's transformation from what he calls a 'mercenary' focused solely on making money to a 'missionary' driven by purpose and values. His first major venture, Diapers.com, pioneered online baby product sales despite losing money on every diaper sold. After Amazon's aggressive competitive tactics forced a sale for $550 million, Lori launched Jet.com with $750 million in funding to compete directly with Amazon again.

The discussion reveals the intense competitive dynamics of e-commerce, particularly how Amazon used predatory pricing and acquisition pressure against smaller rivals. Lori's story illustrates both the challenges of competing against tech giants and the strategic value that established retailers like Walmart saw in acquiring innovative e-commerce platforms and talent.

From Banking Prodigy to Olympic Bobsledder

Lori graduated from Bucknell University in 1993 and joined Bankers Trust, becoming the youngest executive vice president at age 28 while earning $500,000 annually.

In 1996, Lori qualified for the U.S. national bobsled team after casually trying a promotional sled setup at the World Financial Center in Manhattan and recording the fastest time of the week.

Despite qualifying for the 1998 Olympics, Lori chose to continue his banking career rather than commit to two years of training and travel, driven by his 'mercenary' focus on making money.

The Sports Stock Market Experiment

In 2000, Lori left banking to launch The Pit with childhood friends Vinny Bharara and Lax Chandra, creating a sports stock market where baseball cards served as proxies for athlete performance.

Lori invested his entire savings of $390,000 into the company, telling investors 'that's all I had' when asked why not $400,000, which convinced 60 angel investors to contribute $5 million total.

The business generated $10 million in transaction revenue in 10 months before the NASDAQ crash made fundraising impossible, leading to a $5.7 million sale to Topps baseball card company.

Diapers.com: Losing Money to Build Market Share

Lori discovered 'diapers' was searched 200,000 times monthly on Google in 2004, but no one sold them online at reasonable prices because they were loss leaders with terrible margins.

Initially, Procter & Gamble and Kimberly Clark refused to sell directly, forcing Lori and Vinny to buy diapers at full retail price from wholesale clubs like BJ's and Costco without any markup.

The strategy was intentional: 'We didn't mark them up. We just lost more money' to drive traffic and sell higher-margin baby products, leveraging unlimited online shelf space versus brick-and-mortar limitations.

Lori's team developed sophisticated box optimization algorithms to maximize shipping efficiency, recognizing that marginal costs for additional items in the same box were minimal.

Amazon's Aggressive Competitive Response

By 2010, Diapers.com reached $300 million in revenue, prompting Amazon to slash diaper prices by 30% - 'unprecedented in the history of retail' according to Lori.

The Everything Store by Brad Stone documented Amazon's tactics, including a September 2010 meeting where Amazon announced Amazon Mom and threatened further price cuts if Diapers.com didn't accept acquisition.

Amazon's representatives told Lori they would 'take the price of diapers to zero' and made explicit threats about burying the business if he accepted a competing offer $100 million higher than Amazon's.

The $550 million Amazon acquisition felt like 'selling out' rather than selling the company, leaving Lori and Vinny depressed despite the financial windfall because their vision was cut short.

Jet.com: The $3 Billion Gamble Against Amazon

After leaving Amazon in 2013, Lori launched Jet.com with a plan to lose $3 billion before profitability, raising $750 million to build a more efficient e-commerce platform.

Jet's smart pricing engine encouraged customers to buy multiple items from the same warehouse, offering real-time price reductions when substitutions could eliminate separate shipments and reduce costs.

The company initially launched with a $50 annual membership fee like Costco, but dropped it after three months when investors expressed concerns about proving retention rates quickly enough.

Burning $40 million monthly, Jet reached a $1 billion revenue run rate within 10 months of launching, which Lori believes was 'probably unprecedented at the time.'

Walmart's Strategic $3.3 Billion Acquisition

Walmart CEO Doug McMillon acquired Jet.com for $3.3 billion in 2016, the highest price ever paid for a U.S. e-commerce startup, to gain technology and talent rather than the brand itself.

Unlike the Amazon experience, Walmart empowered Lori to lead e-commerce strategy, with McMillon saying 'we want to give you and your team the keys to sort of pull this all together.'

Lori's strategy included acquiring brands like Bonobos to 'change the narrative' and attract top talent who previously wouldn't consider working at Walmart.

After four and a half years at Walmart, Lori stepped down feeling he had 'dramatically accelerated top line sales' and created an innovation incubator for future retail startups.