That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea

by Marc Randolph

The truth is that for every good idea, there are a thousand bad ones. And sometimes it can be hard to tell the difference.

What I needed was the feeling of being deeply engaged with a project. What I needed was purpose.

But the point is that customizing a unique product for every customer is just too difficult. It never gets easier. The effort to make a dozen is exactly twelve times the effort it takes to make one. You’ll never get ahead.”

But you want something that will scale,” he said. “You want to sell something where the effort it takes to sell a dozen is identical to the effort it takes to sell just one. And while you’re at it, try and find something that’s more than just a onetime sale, so that once you’ve found a customer, you’ll be able to sell to them over and over again.

The truth is, I like headaches. I like a problem in front of me every day, something to chew on. Something to solve.

The truth is that no business plan survives a collision with a real customer. So the trick is to take your idea and set it on a collision course with reality as soon as possible.

In fact, secrecy was the least of our concerns. I’d realized by then that telling people about my idea was a good thing. The more people I told my idea to, the more I received good feedback, and the more I learned about previous failed efforts. Telling people helped me refine the idea – and it usually made people want to join the party.

anything was possible with enough effort, enough ingenuity, and enough money.

Our office sent a clear message: this isn’t about us, it’s about the customers.

reasons for working there weren’t exotic perks or free food. It was the camaraderie and the challenge, the opportunity to spend your time solving hard, interesting problems with smart people.

You didn’t work for us because you wanted a beautiful office. You worked for us because you wanted the cha...

The anxiety of paying that much won’t last. But the enjoyment of living there will last forever.

I firmly believe that a healthy startup culture arises from the values and choices made by the startup’s founders. Culture is a reflection of who you are and what you do – it doesn’t come from carefully worded mission statements and committee meetings.

So as a leader, the best way to ensure that everyone arrives at the campsite is to tell them where to go, not how to get there. Give them clear coordinates and let them figure it out.

What they really want is freedom and responsibility. They want to be loosely coupled but tightly aligned.

Before you launch, you’re making a beautiful battle plan, coordinating the future movements of your troops. The second you launch, you’re in the fog of war.

Kinda puts all our eggs in one basket,” he said. “That’s the only way to make sure you don’t break any,” I replied.

Focus is imperative. Even when the thing you’re focusing on seems impossible. Especially then.

In a pitch, perfection isn’t always the goal: projection is. You don’t have to have all the answers if you appear to be the sort of person to whom they’ll eventually come.

Jeff Bezos, Steve Jobs, Reed Hastings – they’re all geniuses who did something that no one thought was possible. And if you do that once, your odds of doing it again are exponentially higher.

But one of the things I was learning, that first year, was that success creates problems. Growth is great – but with growth comes an entirely new set of complications. How can you preserve your identity even as you include new members on your team? How do you balance continued expansion with coherent identity? How do you ensure that you continue to take risks, now that you have something to lose?

You don’t appear tough and candid enough to hold strong people’s respect,

When your dream becomes a reality, it doesn’t just belong to you. It belongs to the people who helped you

If you’ve got the right people on your team, you don’t need to tell them exactly how you want them to do things – in fact, you often don’t even need to tell them what you want them to do. You simply need to be clear about what you want to accomplish and why it’s important.

We just made sure that each of us understood the company’s objectives, and which aspects each of us was responsible for.

Just remember: you’re a manager. Part of your job is making sure that your team knows what you want them to accomplish and why it’s important.

People who have the judgment to make decisions responsibly love having the freedom to do so. They love being trusted.

Most companies end up building a system to protect themselves from people who lack judgment. And that only ends up frustrating the people who have it.

What if we didn’t have a set number of vacation days? What if we just trusted our employees to get things done?

Part of why she was so successful is because she held everyone, including senior leadership, accountable. It didn’t matter who you were – Patty would call you on your bullshit. She was never afraid to speak truth to power.

Because if Nobody Knows Anything – if it’s truly impossible to know in advance which ideas are the good ones and which aren’t, if it’s impossible to know who is going to succeed and who isn’t – then any idea could be the one to succeed. If Nobody Knows Anything, then you have to trust yourself. You have to test yourself. And you have to be willing to fail.

But it wasn’t something that we thought our way toward – it wasn’t something anyone could have predicted ahead of time. It took a lot of hard work, a lot of hard thought. It also took a lot of cards falling just right. Other people call that luck. I call it nobody knowing anything.

Focus. It’s an entrepreneur’s secret weapon. Again and again in the Netflix story – dropping DVD sales, dropping à la carte rentals, and eventually dropping many members of the original Netflix team – we had to be willing to abandon parts of the past in service of the future. Sometimes, focus this intense looks like ruthlessness – and it is, a little bit. But it’s more than that. It’s something akin to courage.

And it turns out that people love to be asked for their opinion. Everyone’s a critic.

My goal was to make sure that however quickly we moved, however efficient we got, we were always fundamentally seeking to connect with our users.

success is expensive.

In fact, disagreement was a critical component of our culture of radical honesty. We expected disagreement, because we encouraged vigorous debate.

there was no seniority, and no one’s opinion was more valuable because of their title, age, or salary. Everyone was expected to fight for their point of view until a consensus had been reached.

Hiring and keeping star players is about much more than just quality of work, however. It’s a culture thing. When you retain only star players, you create a culture of competitive excellence. It’s more fun to come to work when you know you’re part of the handpicked elite. Plus, it’s much easier to attract other elite talent to your team when you’ve established a reputation for superstar talent.

No doesn’t always mean no,

knew that our idea was good. It might not happen now, but it would one day.

Here’s what I’ve learned: when it comes to making your dream a reality, one of the most powerful weapons at your disposal is dogged, bullheaded insistence. It pays to be the person who won’t take no for an answer, since in business, no doesn’t always mean no.

But you and I both know that ‘success’ means a slightly different thing to VCs than it does to a company’s founders.”

VCs will always say that they’re aligned with your mission, that they want what’s best for the company. But what they really want is what’s best for their investment in the company. Which isn’t always the same thing.

happiness existed on a totally different axis than money.

question of usefulness, of the pleasure of utility. Working, for me, was never about getting rich – it was about the thrill of doing good work, the pleasure of solving problems.

My father’s death put things in perspective for me. It led me to evaluate what truly mattered in my life – what fulfilled me as a father, a husband, an entrepreneur. As a person.

you learn two important things about yourself: what you like and what you’re good at. Anyone who gets to spend his day doing both of those things is a lucky man.

story is messy. And when you’re talking to the press, to an investor, or to a business partner, people really don’t want to hear it. They want a version that’s neat and clean with a bow on it. Reed recognized that almost immediately, and so he came up with a story. It’s a great one. That story captures the essence of what Netflix is about, and it solved a big problem for us. That story gave us a narrative.

I have a sense of which two or three issues are the critical ones, even if they are not the ones