That Will Never Work' is the untold story of Netflix. It's how a handful of people, with no experience in the video business, went from mailing a used Patsy Cline CD and ended up with a publicly traded company.
Marc Randolph
People are always advised to follow your dreams, but in 'That Will Never Work' I show them how!
People imagine that Netflix sprang fully formed into a global streaming giant, but Netflix might have been personalised sporting goods - or customised shampoo - or even pet food, since these were all ideas that I pitched Reed Hastings in those first months.
I don't know if there's a genetic marker for entrepreneurship. But if there is, it's most likely not a genius for planning. It's a propensity for action - and the ability to put failure behind you quickly. To stop being precious about your ideas.
The most powerful step that anyone can take to turn their dreams into reality is a simple one. You just need to start.
Negotiation is empathy. It's almost trite to say that if you can't put yourself in the seat of the other person you're speaking with, you're not going to do well. It's not about being a bully, not about making offers people can't refuse.
Iteration, not ideation, is the most important part of early stage entrepreneurship. You have to have a lot of ideas - a lot of bad ideas - if you want to end up with a good one.
Luck was a huge part of the Netflix story.
No one knows what's a good idea or a bad idea until you try it.
The lessons I learned starting Netflix - and over a lifetime of entrepreneurship - are broadly applicable to anyone with a dream.
If you want your company to succeed, you have to have the confidence in your business to take a bet on its future - to risk destroying a mediocre business model for the chance to have a strong one.
In a two-sided market, focusing on the customer will increase a business's ability to extract value from the supply side.
When an opportunity comes knocking, you don't necessarily have to open your door. But you owe it to yourself to at least look through the keyhole.
When I was 23, I was quite possibly the worst real estate agent in New York. I was working for my mother's agency in Chappaqua, and no one was buying houses. In eight months, I made zero sales. I rented one apartment.
Most people have a kind of survivor bias about luck. When something wonderful happens - when preparation meets opportunity, with excellent results - we think: 'How lucky!' But we don't usually acknowledge all the times when things just... fizzle out. All the times when preparation comes to nothing.
At Netflix, we realized that we weren't in business with the Toshibas and the Sonys of the world. We were in business with the guy sitting at home trying to find a DVD to watch. If we had the courage to focus on him, everyone - movie studios, electronics companies, Netflix itself - won.
When a company gets bigger, when it begins to bring on employees, it naturally goes through this tendency of wanting to control, of wanting to build process - essentially to say not every one of our customers or employees has great judgment.
As Looker got larger, the talented people we hired started to see things that we couldn't. And what had looked like a company the three of us could run out of our houses for a few hours a day became something bigger. Much bigger.
Risk taking in business is one thing. Risk taking in your personal safety is a different thing.
Companies make a big point of how their culture is all about 'bad news first,' but when it comes to people, they are suddenly scared to communicate bad news out of some mistaken feeling of politeness or political correctness.
I'm not a 'but' man. Nothing good ever comes of that word.
The real story of Netflix is complicated: an epic tale full of struggle, disappointment, drama, humor, and achievement.
In 'That Will Never Work,' I give readers a clear-eyed insider's look into how one of the least likely startups grew into one of the world's most successful companies.
Companies become what they want to become.
I'm definitely a note taker.
There's nothing worse than the guy who at the party goes, 'Oh, I had that idea two years ago.' Well, then, why didn't you do something two years ago?
Here's a simple truth: When you surround a good idea with brilliant people, it changes. No matter how much you plan, great ideas have a mind of their own.
When entrepreneurs talk about their success, they rarely talk about luck. I think that's because most of them think the concept denigrates the hard work and smart thinking they put into their projects. But luck is a huge part of any successful business.
As software began to be sold to people who would never consider themselves technical, it suddenly became clear that you needed people who spoke their language.
Some of my fondest memories of the early years of Netflix have to do with our efforts to figure out the most efficient, effective, and fast methods to get DVDs to people all over the country.
As a student I'd done work with a charity that took inner-city kids from disadvantaged areas and introduced them to hiking and climbing in the wilderness.
No one has ever asked me to give a graduation speech. But in my years of working with aspiring entrepreneurs, many of them in college, I've gotten used to giving advice.
Now, I love a good factory tour. Drop me into a bottling plant, an automotive assembly line, or a jellybean factory, and I'm happy as a clam at high tide.
When I first met Jeff Bezos back in the late 90s, the only automated thing in his office was a rotating fan, gently blowing across a pair of identical blue shirts he'd hung on a water pipe behind his desk.
I just always believed we would succeed. Even when everyone else said my ideas were ridiculous. Even when we were almost out of money. Even when the metrics were all upside down. I always have confidence that I'll figure something out. I just have that confidence that things are going to work out fine.
I came from years and years in the direct marketing industry where everything is layered.
Like Netflix, Looker started as nothing more than an idea. Lloyd Tabb and Ben Porterfield were two brilliant engineers who had figured out a better way for businesses to see and analyze their data, and they asked me to join them to help out with the ABCs - that's short for Anything But Coding.
I'm not sure I want to preserve the old ways just for the sake of saying, 'I don't believe in change.'
Most people who have ideas, those ideas sit in their head forever until they eventually die.
I'm this big believer that culture is not what you say, it's what you do. Who cares about your PowerPoint and about what you've carved into your cornerstone? If it's not being modeled, it won't be readable.
Banks and investors don't usually view a high-ranking executive in the company selling off massive amounts of stock as a good thing.
When you're in a meeting and you pull out your paper notebook, people look at you and go, 'Oh, he's taking a note.' But if you're in a meeting and you pull out your iPad, they go, 'Oh, he's checking Facebook.'
That became the Netflix culture: radical honesty.
Companies have centers of gravity. Where they are is part of their identity.
Most legacy companies get crushed - they get Blockbustered - because they are too afraid to walk away from the status quo, to embrace what the future is.
If you apprentice yourself to the smartest people who will take you seriously, you will learn at every step. You'll learn their special language. You'll see what real people do. Your interests might surprise you. They will evolve. And you'll be well-positioned to take advantage of whatever opportunity life throws your way.
One of the key lessons I learned at Netflix was the necessity of focus.
At a startup, it's hard enough to get a single thing right, much less a whole bunch of things. Especially if the things you are trying to do are not only dissimilar but actively impede each other.
When someone uses 'low eight figures,' that means barely eight figures.
You pick what your customers want, not what your entrenched business model may require you to do.
