Netflix before you knew it | That Will Never Work, by Marc Randolph
26 July 2022［updated］•
5 min read• Books
"That will never work" is a memoir of Marc Randolph, founder and first CEO of Netflix, about how the idea of Netflix came to be and what challenges and obstacles the company overcame to become what it is today. This book tells the story of Netflix from an unknown startup, an idea 'that will never work', to one of the biggest and most know companies of today.
“Your attachment to this idea isn’t strictly rational.”
The idea of Netflix came about in 1997, when Marc Randolph convinced Reed Hastings and other talented people to join his new venture, selling DVDs by mail. That happened before Netflix even had a name. Many people told Marc: "That will never work."
You could rent a DVD from Netflix. The company would send it to you in a letter. Then, after your renting period expires, you would send it back to Netflix on the same envelope.
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.
Marc hired a lot of smart and hard-working people. In the beginning it is never about money. Those people were working day and night to make a dream a reality. They were paid less than the average. But they believe in it, they saw a great opportunity to solve hard and exciting problems. And they were given the freedom to come up with their own solution.
The day your site launches, something shifts. Your work now is no longer predictive and anticipatory: it’s fundamentally reactive. Those problems you anticipated? You didn’t know the half of it. Your planned solutions? They’re a drop in the bucket. And there are hundreds – thousands – of issues that you could have never even imagined, and now have to deal with.
Even the most known companies have problems every day that they are trying to solve. That is even more true in the startup world. After launching, all your prospects and plans must face reality. And oftentimes, the real world hits hard, and you must be able to endure and move forward, fast.
A culture of freedom and responsibility, coupled with radical honesty, worked like a charm.
Freedom and Responsibility. Those are the two main concepts at the core of Netflix's culture. You must trust the people around you to do the work. Just give them a task, saying what must be accomplished and why it is important; they will figure out how to do it best on their own.
“Nobody Knows Anything” isn’t an indictment. It’s a reminder. An encouragement.
All people make mistakes. "Nobody Knows Anything" means that every possible choice or plan it is a bet, you cannot predict the exact outcome. That is why most people are afraid to make choices, they are scared of the consequences in case things go wrong. Great innovators are never afraid to make hard decisions because they know that the 'right' choice in most cases cannot be foreseen. They are able to adapt to the situation and move forward by being relentless and hard-working.
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.
In the beginning, Netflix was selling and renting DVDs. The problem was that only a small percentage of customers were renting, the main source of income was selling. However, the people at Netflix knew that sooner or later other companies will start selling DVDs, and having strong competitors could mean losing all your customers. Therefore, they made a deal with Amazon and they stopped selling DVDs. They focused all their energy on renting. With time this choice paid back.
As Marc writes: "Most times, deciding what not to do is harder than deciding what to do."
The most powerful step that anyone can take to turn their dreams into reality is a simple one: you just need to start.
In the end, the most powerful lesson learned from the story of Netflix is that you never know beforehand that "That will never work." You just need to start, build and launch your product, see how people react, be willing to work hard, change things, and be passionate.
This is the first of a series of ideas and quotes I will share found in the books I read. My purpose is to make people aware of the power and wisdom in books. I am also starting this series because I believe that reviewing a book means remembering its lessons. And I love to share those lessons with as many people as possible, which is also the purpose of a biography or memoir. So, if you agree, please share it with some of your friends.
Thanks for reading.