The death of Zappos' Tony Hsieh: A spiral of alcohol, drugs and extreme behavior

Two weeks before Zappos.com Inc. co-founder Tony Hsieh died in a November house fire, one of his closest friends in Las Vegas got a phone call.

"Tony is in trouble," the caller told Philip Plastina, the founder of an electronic dance music group that frequently performed at Mr. Hsieh's parties and live events over the past decade.

Because of the pandemic, Mr. Plastina hadn't seen Mr. Hsieh since the lauded tech executive relocated from Las Vegas to Park City, Utah, earlier this year. The caller asked Mr. Plastina to go to Park City right away in hopes he could help pull Mr. Hsieh out of what the caller described as escapist tendencies, including increasing drug and alcohol abuse.

Mr. Plastina said he texted two phone numbers he had for Mr. Hsieh and sent several emails but received no response. Mr. Plastina never reached his friend.

Mr. Hsieh, 46 years old, died on Nov. 27, nine days after firefighters were called to a home in New London, Conn., where he was staying. The Connecticut medical examiner has ruled the death an accident. The fire department is investigating the fire's cause.

Many questions remain about the specific circumstances of his death. Close friends now say it was the culmination of a more than six-month downward spiral. The entrepreneur brought online shoe-shopping to the masses as a co-founder of Zappos and wrote a bestselling book on company culture, "Delivering Happiness." This year, he struggled, the friends say.

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In August, he retired as chief executive of Zappos, which he had run for more than a decade after selling it to Amazon.com Inc. for more than $1 billion.

Mr. Hsieh spoke often about partying as a central feature of his work and life, and his drinking increased after he retired and grappled with the isolation enforced by the pandemic, those close to him said. He began experimenting with drugs, such as mushrooms and ecstasy, they said.

That was only one component of increasingly extreme behavior. A longstanding fascination with fire intensified, friends said. A real-estate agent who sold him a mansion in Park City and visited the house shortly afterward estimated Mr. Hsieh had 1,000 candles there.

Mr. Hsieh became fixated on trying to figure out what his body could live without, according to one friend. He starved himself of food, whittling away to under 100 pounds; he tried not to urinate; and he deprived himself of oxygen, turning toward nitrous oxide, which can induce hypoxia, this person said.

Mr. Hsieh was increasingly away from his longtime friends and family in San Francisco's Bay Area and Las Vegas, and was surrounded by a new group that indulged his behavior, close friends said. According to them, the new group, including some former Zappos employees who had moved to Park City from Las Vegas, were taking advantage of Mr. Hsieh, living in his homes and collecting salaries for little work.

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"Things were falling apart for him," said Mr. Plastina.

There were signs Mr. Hsieh knew he was in trouble. On the night he died, he was making plans to check into a rehabilitation clinic in Hawaii. He was in New London staying with a longtime girlfriend and former Zappos executive, Rachael Brown, along with one of his brothers, Andy Hsieh, and others, said people close to him.

Mr. Hsieh at one point said he was going to a shed that was attached to the home, and asked the people in the house to check on him every five minutes, by the people's account. They said Tony used a heater in the shed to lower the oxygen level.

It isn't clear what started the fire. When the others at the house tried to get to him, they couldn't. One emergency worker was heard telling others he was barricaded inside. Mr. Hsieh died from complications of smoke inhalation, the coroner said.

Over his 20 years as an executive, Mr. Hsieh carved out one of the most unusual and closely studied careers in business, in which he helped reshape customer service, tried to single-handedly revitalize parts of Las Vegas and challenged the role of hierarchies in corporations.

Zappos employees relished Mr. Hsieh's eagerness for them to express their individuality and carve out their own roles in a company with few bureaucratic boundaries.

Mr. Hsieh was introverted but had a deep desire to bring people together, and invested time and money into his friends' lives. One friend described him as "The Giving Tree," referring to the story by Shel Silverstein in which a tree gives every part of itself to a boy he loves but gets nothing in return.

Mr. Hsieh blended his personal and professional lives into a quest for spiritual union with his colleagues, and sought to make both more about fulfilling personal dreams and novel sensations than piling up money, friends and former co-workers say. His approach to life earned him wealth and many admirers. It also contributed to his final, tragic months.

Mr. Hsieh, born to Taiwanese parents who raised him in Marin County, Calif., sold the first company he founded, an internet advertising service called LinkExchange, to Microsoft Corp. for about $265 million when he was in his mid-20s.

The next year he invested in what became Zappos, nursed it through the dot-com bust and became chief executive. Amazon.com Inc. bought Zappos in 2009 for more than $1 billion. Mr. Hsieh remained chief executive.

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In Las Vegas, where Mr. Hsieh moved Zappos headquarters, he became beloved locally for investing $350 million into revitalizing part of the city's downtown, including restaurants, retail sites and a technology fund, starting in 2012.

At Zappos, Mr. Hsieh didn't believe in company hierarchy, assigning some employees titles like "fungineer."

When Mark Guadagnoli, currently a professor of neuroscience at the University of Nevada, Las Vegas, took a break from his academic career to work for a couple of years at Zappos, Mr. Hsieh gave him the title of "zookeeper." He was charged with creating Zappos University, the company's culture training center.

Mr. Hsieh was annoyed when people referred to the area where he sat as "executive row," recalled Dr. Guadagnoli, who remained friends with Mr. Hsieh.

Dr. Guadagnoli said he began calling it Monkey Row, and Mr. Hsieh loved that idea. Mr. Hsieh arranged for camouflage netting to be put up and suspended stuffed monkeys and other creatures.

"He was really interested in what made jokes funny," Dr. Guadagnoli said. The professor once made an amusing remark and then smiled. "I think it would be funnier if you didn't smile," he recalled Mr. Hsieh responding.

For one New Year's Eve party at his 3,500-square-foot loft in San Francisco, he rented a fog machine, which ended up setting off a fire alarm. He had to apologize when two firetrucks showed up.

Alcohol-fueled parties were frequent at the company and at Mr. Hsieh's homes, in San Francisco and later in Las Vegas and Park City.

Mr. Hsieh wrote in "Delivering Happiness" that shots of Grey Goose vodka were a company tradition. He told Playboy magazine in 2014 he wrote the book in part fueled by coffee beans soaked in vodka. Friends say he went through a period in which he was obsessed with the Italian liqueur Fernet.

"Ultimately happiness is really just about enjoying life," he wrote in the 2010 book.

Mr. Hseh wrote that the Zappos culture was all about the pursuit of fun. "When you need to party, you party. When you need to produce, you produce," he wrote.

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In a written statement, a Zappos spokeswoman said the company "is committed to providing a safe and fun workplace for all of our employees. As part of this, all employees are required to review our Code of Conduct, which includes guidance on team gatherings and company functions."

According to Dr. Guadagnoli, Mr. Hsieh ran experiments on himself -- limiting his sleep to four hours a day and climbing the three highest peaks in Southern California in one day.

He tried a 26-day diet, eating only foods that started with the letter "A" on the first day and progressing through the alphabet each day. Some letters offered indulgences. The final "Z" day amounted nearly to fasting, according to one friend, Paul Carr.

In 1999, Mr. Hsieh discovered the joy of raves after going to one in a warehouse.

"As someone who is usually known as being the most logical and rational person in a group, I was surprised to feel myself swept with an overwhelming sense of spirituality," he wrote in his book. "It was as if the existence of individual consciousness had disappeared and been replaced by a single unifying group consciousness."

Mr. Hsieh was a frequent attendee at the Burning Man music festival in the Nevada desert, bringing art from the festival back to downtown Las Vegas. A 40-foot praying mantis that shoots fire is on display outside his "Container Park" development in Las Vegas, in which shops are located inside stacks of converted shipping containers.

At one annual event, Mr. Hsieh saw an electronic dance music performance group who called themselves the "Dancetronauts" perform. He fell in love with the group and insisted they become part of his plan to revitalize Las Vegas, said Mr. Plastina, the head of the group, who uprooted his life in California a decade ago to be part of Mr. Hsieh's vision.

Mr. Hsieh joined the Dancetronauts in his own astronaut jumpsuit, and the group became frequent performers at Las Vegas's monthly "First Friday" arts festival. They also performed at Mr. Hsieh's regular parties in his self-built community, a collection of trailers and tiny homes, including an Airstream that he lived in.

The Airstream compound, as it was known to friends, also featured a fire pit and a stage. Mr. Hsieh let his pet alpaca, Marley, roam around.

Mr. Hsieh bought friends houses, apartments and restaurants, say people who knew him. "He created greenhouses for people to be themselves and flourish," said Jenn Lim, a longtime friend who helped Mr. Hsieh write his book and now heads a consulting and training firm that espouses his management philosophy.

Earlier this year, Mr. Hsieh began buying properties far from Las Vegas, in the Utah resort town of Park City, with a similar mission of transforming its downtown, according to people familiar with his plans.

The centerpiece was a 17,350-square-foot mansion with a private lake that he bought for about $16 million, said Paul Benson, a real-estate agent who represented the sellers.

He also bought condos in the area for guests and quietly began investing in local businesses.

When he visited the mansion, Mr. Hsieh wanted the house immediately and asked the family who owned it not to return home so he could begin living there right away, Mr. Benson said.

The family agreed. Mr. Hsieh was constantly surrounded by other people, and the purchase appeared to Mr. Benson to be a group decision.

"Tony was clearly the leader, but there was definitely a group of people that had said they were moving to Park City because of Tony, that had said he was extremely generous and a big part of their families, their worlds, and they were going to follow him to Park City," Mr. Benson said.

Mr. Benson said when he visited the house to help retrieve the sellers' belongings and found the host of candles, Mr. Hsieh "explained to me that the candles were a symbol of what life was like in a simpler time."

Mr. Hsieh had offered to pay friends to move to Park City and work at businesses he helped fund or other city development jobs with vague descriptions; some collected salaries while doing little and living in his homes, and encouraged his drug and alcohol abuse, those close to him said.

Mr. Hsieh hired luxury tour buses to ferry friends to the community. Musician David Perrico said he and members of his Pop Strings Orchestra rode one of those buses in August at the invitation of Ms. Brown, Mr. Hsieh's girlfriend and a cellist in the band. Ms. Brown didn't respond to requests for comment.

Mr. Perrico said he stayed in a condo and visited the mansion, jamming with other musicians, with the idea of possibly performing in a future venue in Mr. Hsieh's developing vision for Park City, but saw Mr. Hsieh only once in passing.

Mr. Hsieh was uncomfortable in one-on-one settings, friends said, and the pandemic closed off much of his social scene. His drug use increased, they said.

In Las Vegas and at Zappos, Mr. Hsieh always had a strong group of friends who questioned his grandiose ideas and were able to stop him when his plans didn't make sense. In Park City he was surrounded by people who only told him "yes," one of his close friends said.

After a therapist recommended a "digital detox" this spring, Mr. Hsieh began further distancing himself from some of his longtime friends, who had trouble reaching him. When one FaceTimed him in early July, "he did not look well," the friend said.

By August, his father, brother Andy and a half dozen friends were planning an intervention to organize professional help for him, according to people familiar with the efforts.

That same month, Mr. Hsieh's retirement from Zappos exacerbated his downward spiral, friends say. Some such as Mr. Plastina said they tried unsuccessfully to reach him in his last weeks.

On Nov. 18, firefighters rushed to a burning three-story beachfront home in New London at 3:34 a.m. An emergency worker said one man was "stuck inside," according to a radio recording of first responders. Some firefighters and dispatchers referred to the victim as "trapped."

One gave a different description. "The male is barricaded inside," that person said over the radio. "He's not answering the door. Everyone else is outside the house. They are trying to get him to open up."

Mr. Hsieh's estate is likely worth hundreds of millions of dollars. In a court filing, family members have said it appears Mr. Hsieh died without an estate plan. On Thursday, a judge in Las Vegas appointed Mr. Hsieh's father, Richard, and brother Andrew as special administrators and legal representatives of the estate, finding that Mr. Hsieh's personal and business affairs "require immediate attention to prevent loss to the estate."

In a written statement, the Hsieh family said they wouldn't comment on the specifics of Mr. Hsieh's life and career. They said they were "deeply grateful for the outpouring of love and respect shown in the wake of Tony's passing. It is clear to us he had a profound impact on countless people all over the world."

The family said they planned to "carry on his legacy by spreading the tenets he lived by -- finding joy through meaningful life experiences, inspiring and helping others, and most of all, delivering happiness."

Kate King and Jim Oberman contributed to this article.