Business leaders explain why they love Amazon CEO Jeff Bezos' annual letter so much

Parsa Saljoughian, an investor at venture capital firm IVP, gives the same answer every time he's asked about his favorite business book: Amazon CEO Jeff Bezos' annual shareholder letter.

Sure, Bezos' letter is not technically a "book," he acknowledges. But when all 20 of the annual letters are put together — which amount to roughly 70 pages in total — it starts reading like any inspirational bestseller, he said.

"It's one of the best reads that anybody interested in business should read," he said. "You can really learn a lot by reading all of them."

Saljoughian isn't alone in praising Bezos' annual letter, which has been published every year since Amazon went public in 1997. The letter has become a must-read in business circles for giving a good look into the Amazon CEO's management principles and long-term thinking.

And as Amazon continues to expand, propelling Bezos to the richest man in the world, his letters are drawing even wider appreciation among business leaders and executives worldwide.

Chamath Palihapitiya, the CEO of venture capital firm Social Capital, says he's a big fan of Bezoss letters because they serve as a reminder to keep a long-term view, while keeping things simple. Too many leaders, he notes, tend to be short-sighted and over-complicate the process of building a business, often leading to failure.

"Bezos is the smartest, longest long-term thinking public CEO out there," Palihapitiya said. "His letters are a strict reminder to stick to the basics and that you need to keep things simple, but long-term."

In this year's letter published Wednesday, Bezos again stressed the idea of long-term thinking, using an anecdote about a friend who visited a handstand coach who told her it would take six months to master the skill:

In the very first lesson, the coach gave her some wonderful advice. "Most people," he said, "think that if they work hard, they should be able to master a handstand in about two weeks. The reality is that it takes about six months of daily practice. If you think you should be able to do it in two weeks, you're just going to end up quitting." Unrealistic beliefs on scope – often hidden and undiscussed – kill high standards.

Stuart Lombard, CEO of the smart thermostat maker Ecobee, says he likes to share Bezos' annual letter with the whole company for inspiration. Some of the key insights, like long-term thinking, continuous learning, and simplified company structure, all serve as building blocks for his startup's culture, he said. Ecobee is a close partner of Amazon and has raised money from the company's Alexa Fund, too.

"We try and use a lot of the concepts in the way we organize and run the business," he said.

Bezos isn't the only CEO that writes popular shareholder letters. Berkshire Hathaway CEO Warren Buffett's annual shareholder letters is still considered one of the best reads among business leaders, and a compilation of his letters have been published as a book. JP Morgan CEO Jamie Dimon's annual letters are also highly regarded.