Date read: 08 September 2020
If you had asked me on launch day to describe what Netflix would eventually look like , I never would have come up with a monthly subscription service .
Great journey into the development of an idea from nothing to something, highlighting the messy process of figuring things out and actively pushing against the "founding moment", where the CEO is looking through the window A Beautiful Mind style and figures out the idea that will get them to the IPO.
Instead, we get the founding team's entertaining story of iterating through a bazillion ideas, in a tech landscape that feels very foreign to the present moment, ending with the bittersweet moment of Netflix's IPO.
Disclaimer: a lot of these notes are subjective and highlighted for personal purposes. There is a high chance I missed a lot of good insights as well as these notes missing some context around it.
- Epiphanies are rare . And when they appear in origin stories , they’re often oversimplified or just plain false . We like these tales because they align with a romantic idea about inspiration and genius . We want our Isaac Newtons to be sitting under the apple tree when the apple falls . We want Archimedes in his bathtub . But the truth is usually more complicated than that . The truth is that for every good idea , there are a thousand bad ones . And sometimes it can be hard to tell the difference .
- Silicon Valley loves a good origin story . The idea that changed everything , the middle - of - the - night lightbulb moment , the what if we could do this differently ? conversation . Origin stories often hinge on epiphanies . The stories told to skeptical investors , wary board members , inquisitive reporters , and – eventually – the public usually highlight a specific moment : the moment it all became clear
- The best ideas rarely come on a mountaintop in a flash of lightning . They don’t even come to you on the side of a mountain , when you’re stuck in traffic behind a sand truck . 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 .
- “ We need a product that already exists in the world , ” I said . “ But that we can help people access online . Bezos did it with books . You don’t have to write books to sell them . ”
On execution & product validation
- Notice that I used the word “ approaching . ” I never intended to get there . Most business plans – with their exhaustive go - to - market strategies , detailed projections of revenue and expenses , and optimistic forecasts of market share – are a complete waste of time . They become obsolete the minute the business starts and you realize how wildly off the mark you were with all your expectations . 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 .
- 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 .
- It’s the same at a startup . Real innovation comes not from top - down pronouncements and narrowly defined tasks . It 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 .
- 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 .
- There are a great many stages in the life cycle of a startup . But a tectonic shift happens on launch day . Before you go live , you’re in the dreamy zone of planning and forecasts : your efforts are provisional . You’re making predictions about what can go wrong and what can go right . It’s a very creative , heady sort of work . It is essentially optimistic . 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 .
- 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 . Go ahead and write up a plan , but don’t put too much faith in it . The only real way to find something out is to do it .
- We’d designed our site so that the impact of even the slightest change could be measured and quantified . We’d learned , before launch , how to test efficiently . It didn’t matter , in the end , how great a test looked – there could be broken links , missing pictures , misspelled words , you name it . What mattered was the idea . If it was a bad idea , even more attention to detail in our test wasn’t going to make it a good one . And if it was a good idea , people would immediately fight to take advantage of it , despite obstacles or sloppiness on our end .
- If people want what you have , they will break down your door , leap over broken links , and beg you for more . If they don’t want what you’ve got , changing the color palette won’t make a damned bit of difference .
- We were always trying to avoid one of the number one pitfalls of startup entrepreneurship : building imaginary castles in your mind , meticulously designed , complete with turrets , drawbridges , moats . Overplanning and over designing is often just overthinking – or just plain old procrastination . When it comes to ideas , it’s more efficient to test ten bad ones than spend days trying to come up with something perfect .
- Silicon Valley brainstorming sessions often begin with someone saying , “ There are no bad ideas . ” I’ve always disagreed . There are bad ideas . But you don’t know an idea is bad until you’ve tried it .
- Radical honesty is great , until it’s aimed at you .
- Whether it was just the two of us or a twenty - person departmental meeting , we felt that we owed it to the company ( and each other ) to make sure that we’d teased out the proper solution – or , more accurately , beat it out of each other with 4 - irons and billy clubs .
- When I was twenty - one years old , fresh out of college and about to start my first job , my father gave me a handwritten list of instructions . The whole thing took up less than half a page , in my father’s neat engineer’s handwriting . It read :
RANDOLPH’S RULES FOR SUCCESS
1 . Do at least 10 % more than you are asked .
2 . Never , ever , to anybody present as fact opinions on things you don’t know . Takes great care and discipline .
3 . Be courteous and considerate always – up and down .
4 . Don’t knock , don’t complain – stick to constructive , serious criticism .
5 . Don’t be afraid to make decisions when you have the facts on which to make them .
6 . Quantify where possible .
7 . Be open - minded but skeptical .
8 . Be prompt .
- “ That will never work . ” That was the first thing out of Lorraine’s mouth the night I told her the idea for Netflix . She wasn’t the only one . I heard that from dozens of people , dozens of times . ( And to be fair to her , the idea as originally conceived wouldn’t have worked . It took years of adjustments , changes in strategy , new ideas , and plain old luck for us to land on a version of the idea that worked . )