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Truths like: Distrust epiphanies.
They make themselves apparent more slowly, gradually, over weeks and months. And in fact, when you finally have one, you might not realize it for a long time.
“You want 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.”
When you start a company, what you’re really doing is getting other people to latch on to an idea.
Nowadays, you do that by validating your product ahead of time.
you have numbers to prove that what you’re trying to do isn’t just a good idea, but already exists and works.
You had to sell them on your idea.
We figured that it would take $2 million to get the company off the ground: $1 million to get the site launched, and another $1 million to run it while raising our next round of funding.
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.
I’m usually wary of title inflation—although it’s something that seems like it costs you nothing to give, it actually is far more expensive than it seems, since it causes a cascading series of overpromotions.
the breakthrough for me was simply telling people the truth.
It got people’s attention and broke down their cynicism and defenses.
if you’re arguing with a potential investor, it’s already over.
“If you want it, don’t try for a bargain and risk losing it,” she told me. “The anxiety of paying that much won’t last. But the enjoyment of living there will last forever. Go all in.”
Getting the mailer perfect was key—it was the first physical point of contact we’d have with our users.
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.
Real innovation
comes from hiring innovators focused on the big picture who can orient themselves within a problem and solve it without having their hand held the whole time. We call it being loosely coupled but tightly aligned.
Good idea. Interview questions about what would you do about this problem or how would you get the company to achieve... something that shows team member’s potential for leading and innovating versus following
People want to be treated like adults. They want to have a mission they believe in, a problem to solve, and space to solve it. They want to be surrounded by other adults whose abilities they respect.
How would our customers find a DVD? What
Business development question focused on the customer experience
It doesn’t make a difference how good the ads are if the dogs don’t eat the dog food.
That’s what it’s like being in a startup. You spend a lot of time thinking about what might happen. And preparing for it. Sometimes you actually put a backup plan in place, but most of the time you just think through how you will respond—
But up until now, it still had the feeling of an unresolved dream. The site existed for us—but not for anyone else. The problems we anticipated—and we’d racked our brains anticipating them—were still in the future. We weren’t even sure if we’d identified the right problems. The successes, too, were in the unrealized days and months ahead.
You see, a startup is a lonely place. You are working on something that no one believes in, that you’ve been told time and time again will never work. It’s you against the world. But the reality is that you can’t really do it on your own. You need to enlist help. Bring others around to your way of thinking.
lunch allows me to see past all that. More importantly, though, lunch is a chance to start imprinting culture: to explain the most important aspects of working at Netflix, what we expect of people, and what they can expect of us.
selling DVDs is a commodities business.
it will only be a matter of time before our margins shrink to nothing.
DVD rental, on the other hand, has real potential.
As we’ve found out the hard way, renting DVDs online is operationally difficult, which means that it will be difficult for potential competitors to figure it out.
the margins are higher, since you can rent the same disc dozens of times.
Should we focus on selling DVDs, which is bringing in 99 percent of our revenue, but will slowly—inevitably—evaporate as competitors crowd the field? Or should we throw our limited resources behind renting DVDs—which, if we can make it work, could be a hugely profitable business, but at this point is showing absolutely no signs of life?
Although I’m upset, I’m not entirely surprised. The second your dream becomes a reality, things get complicated. You simply can’t know how things are going to behave until you’ve actually tried them.
He didn’t look back—or, as he put it, he “evaluated opportunities using a regret minimization framework.”
puts all our eggs in one basket,” he said. “That’s the only way to make sure you don’t break any,” I replied.
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.
Focus is imperative.
But that’s the thing about startups—you’re almost always on the razor’s edge between total success and total failure.
that’s how startups typically run, in the early days: You hire a bunch of brilliant people to be jacks-of-all-trades. Everyone does a little bit of everything.
hiring a team, not a set of positions.
The company was one dream. Me at the helm was another. And if the company was going to succeed, I needed to honestly confront my own limitations.
But we were exiting that initial stage. Now we were going to have to grow, and rapidly, and that took a different skill set entirely.
And was it even my dream anymore? We now had forty employees, each of whom was as emotionally committed as I was to making Netflix a success. They stayed late, worked weekends, missed commitments to friends and family, all in service to something that had begun as my dream—but which, God bless them, they had adopted as their own.
I really knew that Reed was right. That the CEO/president arrangement would give the company the leadership it deserved. Would greatly increase our odds of success. Would create a company that we could be proud of for the rest of our lives.
I couldn’t believe what I was reading. In the sentences that followed, Reed was saying that in order to come in as CEO he needed more options. And worse, he was saying that a big slug of those shares should come from me. That I should give up some of my equity in the company, since we would now be splitting the responsibilities.
“That’s bullshit!” Lorraine shouted, once I had explained to her what Reed was asking for.
although I couldn’t say, that night, that I was at peace with my decision, I knew that I would be, someday soon. I was starting to see how Reed and I could work together to make the company a success. I could practically hear the engine of our collaboration start to hum.
“I don’t care where you work, or what hours you work. Work from Mars, for all I care. If all you’re asking me is about when you work and where you do it, that’s an easy answer: it makes no difference to me.
“if what you’re really asking me is whether I’m willing to lower my expectations for you and your group so that you can spend time with your girlfriend? Well, that’s an easy answer, too. No.”
I gave that engineer freedom to make a choice, but also reminded him of his responsibility to the team. I was radically honest with him—
