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Zappos CEO Brings Business Success Downtown

LAS VEGAS -- Las Vegas isn't exactly known as a mecca for start-up companies. But recently, it has been referred to as Start Up City. The label is a reference to the latest venture by Zappos CEO Tony Hsieh -- a multi-million dollar investment to transform downtown into a model for redevelopment everywhere.

Hsieh plans to relocate his 1,200 employees from Henderson to the old Las Vegas City Hall next year. And he says they won't be alone.

To help populate downtown with artists, entrepreneurs, and tech workers, Hsieh committed hundreds of millions dollars of his own money to redevelopment efforts. An investment that has the potential to pay off far beyond East Fremont Street.

Hsieh's downtown begins east of Las Vegas Boulevard -- the dividing line, as he sees it, between tourists and locals. To prepare for his company's move from Henderson to the old City Hall, the Zappos CEO filed his own change of address card last year, listing East Fremont Street as his new community.

Community in concept, not just the word. 

"What company culture is to a company, community is to a city. It's the same concept, just at a different scale. So we're using a lot of what we learned at Zappos to help build culture to really do our part to contribute to the community," said Hsieh.

By prioritizing a culture based on 10 core values, like creating fun and a little weirdness, in less than a decade the online shoe retailer topped $1 billion in sales.

For the Downtown Project, a company Hsieh formed to revitalize the area, he brings his unconventional perspective, along with a personal investment of $350 million.

"A lot of projects are very top down, master planned, if you build it they will come-type of mentality, when that's not necessarily the best approach. And what really matters are the people, the community, the energy," he said.

To create what Hsieh and fellow visionary Zach Ware call the most community-focused large city in the world, the Downtown Project has earmarked $200 million for real estate.

"There just aren't that many buildings down here. We're received tons of interest from people that want to open a barbeque place or a restaurant, and there's no place to do it here. So we need to help build that," he said.

The remaining $150 million will seed education initiatives, small businesses, and technology start-ups. Companies like Romotive, inventors of smartphone robots. They are one of five out-of-state start-ups to relocate to downtown in just the last six months.

"I would much rather have 100 10-person companies move here than a single 1,000-person company because it's really the smaller start ups that are going to drive all the growth and grow a lot faster," he said.

Not unlike Zappos, who in eight years expanded their Southern Nevada workforce from 70 employees to more than 1,200. It is the type of potential Hsieh sees throughout the 180 degree view from his apartment in the Ogden Avenue.

"We want to provide the basic infrastructure and then the community will, I think, do its own thing," he said.

These are the beginnings of an urban core where Hsieh imagines the sheer density and connectedness of its residents will increase not only their economic productivity, but also their happiness.

"I think five years from now, people will look back and just ask what just happened, and it will be a completely different city," he said.

If the mission of the Downtown Project is successful, it will likely be a model for community revitalization and economic development world wide. Not unlike the secrets to Zappos' success, which Hsieh shares openly with anyone who's interested.