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First Time Founders with Ed Elson – Reed Hastings: Life After Netflix
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- [00:01]
Scott
Support for the show comes from Brex, the financial stack founders can bank on. Brex knows cash is king for startups, so they built a banking experience that takes every dollar further. Learn more at Brex.com banking-solutions brex.com banking-solutions.
- [00:22]
Sequoia Capital
Support for the show comes from the new season of Crucible Moments, a podcast from Sequoia Capital. What is a Crucible Moment? A turning point where we face a tough decision and our response can shape the rest of our lives. These decisions happen in business too, and Sequoia Capital's podcast Crucible Moments gives you a behind the scenes look, asking founders of some of the world's most important tech companies like YouTube, DoorDash, Reddit and more, to reflect on those critical junctures that defined who they are today. Tune into season two of Crucible Moments today. You can also catch up on season one at cruciblemoments or wherever you listen to podcasts. Support for the show comes from the new season of Crucible Moments, a podcast from Sequoia Capital. What is a Crucible Moment? It's a turning point where we face a tough decision and our response can shape the rest of our lives. These decisions happen in business too, and Sequoia Capital's podcast Crucible Moments gives you a behind the scenes look, asking founders of some of the world's most important tech companies, like YouTube, DoorDash, Reddit, and more, to reflect on those critical junctures that defined who they are today. Tune into season two of Crucible Moments today. You can also catch up on season one at cruciblemoments.com or wherever you listen to podcasts.
- [01:48]
Ed
Scott Imagine you'd built one of the most successful companies in American history. What would retirement look like?
- [01:56]
Reid Hastings
Checks.
- [01:57]
Scott
I'm sorry? What would it look like? It looked like my life right now. Ed, you don't need to build one of the most successful companies to have a wonderful back. 9 I I'm doing exactly what I want to be doing. I hang out with impressive, intelligent young people such as yourself. We make good money, we have purpose, and I get to do amazing things with my friends and family that, you know, make me feel closer to them. I can't imagine doing anything differently. And the only lesson in this humble brag or not so humble brag is once you get to a certain level of economic security, you want to use money as a means to an end. And that ends is great experiences that make you feel closer to your friends and family and recognize that you have an increasingly finite amount of time. Time here.
- [03:03]
Ed
Welcome to First Time Founders. 27 years ago, watching movies on demand meant making a trip to the rental store. But after a frustrating experience with a lost DVD and a hefty late fee, my next guest saw an opportunity for change. He envisioned a world where people could enjoy movies from the comfort of their homes without the hassle of late fees and without making a trip to the store. So in 1997, he launched a company with a groundbreaking idea, Flat rate movie rentals delivered by mail. That single innovation, followed by many more, laid the foundation for what would become the world's leading movie and television streaming Service. With nearly 283 million subscribers and over $28 billion in revenue this year, this founder's vision has forever changed the way we consume entertainment. This is my conversation with Reid Hastings, co founder and executive chairman of Netflix. Welcome, Reid. Thank you so much for joining me.
- [04:06]
Reid Hastings
And what a treat. So excited to be called a first time founder. It's like I'm young again or something.
- [04:13]
Ed
Exactly. I'm just looking at the background behind you. I know that we were in talks about maybe doing this in person and I'm already just feeling huge amounts of regret. The background looks beautiful.
- [04:25]
Reid Hastings
It'd be lovely to have you out here. You got to come see it. I mean, the fall colors right now are incredible. But of course, we're just waiting for the big snows to hit.
- [04:33]
Ed
So our listeners know. Where are you exactly?
- [04:36]
Reid Hastings
Powder Mountain, Eden, Utah, about an hour from Salt Lake City Airport.
- [04:41]
Ed
And that is something that we will be getting into in this interview. That is sort of your newest project, but the title of this program is First Time Founders. You are not a first time founder right now, but you were at one point. So we're going to start with that. We're going to start back in the 90s, right after you had served in the Peace Corps and then you got your CS degree from Stanford and you decided to start a company. But it wasn't Netflix. It was actually a company called Pure Software. So let's start there. Could you tell us the story of Pure Software? What led you to that venture and how it all came about?
- [05:15]
Reid Hastings
You know, I would say that starting a company is like jumping out of an airplane without a parachute and you just assume a bird is going to fly by. And so the people who start companies are unrealistically positive and optimistic. And then occasionally some of the times it works, the bird flies by. And if I think about my own experience, I was excited about a particular product. It found errors in a class of C and C software that no one had been able to find before these memory errors. And I was just hellbound on creating the product. And I had to do a company to see the product come to light.
- [05:58]
Ed
Was this something that you always knew you wanted to do? Did you think that you were going to be an entrepreneur or.
- [06:02]
Reid Hastings
No, I did take one sort of business school, like, class, and I had to learn how to use a spreadsheet to do that. But that was like my little tiny bit. And when I was a grad student, so mid-90s, I got super excited, excited about the foot mouse. And, you know, I was often with old hand mouse in the terminal. You know, it's just slow back and forth to the keyboard. And so, you know, of course I thought of the obvious solution, which is you control the mouse with your foot.
- [06:35]
Ed
This is the first I'm hearing of the foot mouse. I love it.
- [06:38]
Reid Hastings
Yeah. Yeah, the foot mouse is. Was a great idea, I thought, which just shows I'm not very good in the judgment category. I'm good in the passion category. Okay. So anyway, I spent six months. Luckily, I didn't drop out of Stanford to do it. And it turns out two things. One is it's a very dirty environment. And so after a day or two, the foot mouse was pretty gross. And then two, your leg cramps. So it's just not used to that fine dexterity control. And those are both hard problems to solve, which is why there's still no foot mouse 30 years later. But so I would say I've always had the product bug or the passion product bug. And then the first time I really did it, which was pure. It actually worked. So I spent a year at home writing the software, and then I had to figure out a company to figure out how to make it mainstream and distribute it. The company from 91 to 95 doubled every year. Morgan Stanley took us public in 1995. And so in many ways it was a great success of that era. But I was pretty miserable for a lot of it because I didn't know how to do anything in running a company. And so it was just chaos. And that felt bad.
- [07:53]
Ed
Yeah. So this is what's so interesting to me is that you're not known for pure software, but it was a smashing success. I mean, it was your first company, as you said, you took it public in 95. Later you merged it with Atria, and then in 97, it was acquired for nearly $1 billion. And that's roughly 2 billion in today's dollars. So this was like a hit, hit success. And it's just so funny that you view it as kind of a. One, that it's sort of a footnote on your resume. Two, that you view it as sort of a miserable time. And so I'd love to. Just as you reflect on Pure Software, you were a new entrepreneur, it's your first company, it was successful. What do you think you were getting right at that time?
- [08:35]
Reid Hastings
A product passion. Think of one extreme, which is Elon Musk, which is like all passion and envision and you know, he manages quite successfully through inspiration purely right. And then the day to day management of things is pretty chaotic and he's got tons of turnover and yet he still accomplishes amazing things. So call that one end of the spectrum. Another end of the spectrum is the really well run, you know, retail something I don't know that, you know, not that inspiring but very disciplined. And so you can achieve excellence through that or you can achieve excellence at the other end. And my first end was more in the Elon style. It was all about passion of software quality and what that could mean for the world and the problems of software errors. But the day to day management was pretty poor on my part. But we succeeded through kind of energy and passion because then people forgive you a lot of things or you just make mistakes but you charge ahead.
- [09:44]
Ed
So we'll Fast forward to 1997. You've just kind of scored pretty big on Pure Software. You sold the company. And I think for a lot of people at that point you start thinking about maybe early retirement, maybe you move to Saint Barts. You do live a life of arrested adolescents, as Scott likes to say. That's not what you did. You decided you wanted to start another company and this idea was for movie rental delivery. Tell us what was going on in your head at that time and why did DVDs by mail seem like such a good idea to you?
- [10:22]
Reid Hastings
You know, it was the time when Amazon was just going public. E commerce was clearly going to be a big area and there were a lot of foolish companies just saying, okay, I'm going to sell computers or I'm going to sell lamps. And clearly Amazon was going to crush them eventually. And DVD rental or rental generally has those two way logistics. You had to send them back. So it was very unique, unique city specific logistics that we figured Amazon wouldn't bother with. It was too small a market, didn't leverage all their core. There weren't five other things for them to rent. So that would give us, we could ride the E commerce explosion and not have competition from Amazon only have it from the incumbents being Blockbuster and Hollywood Video. And then if we succeeded, we said, okay, then we've got the poll position for converting to streaming. Thus we named the company Netflix and not DVD by mail. Because that was always the ambition.
- [11:19]
Ed
So you mentioned that Netflix was partly inspired by Amazon, perhaps totally inspired by Amazon. I didn't realize this, but at one point, Jeff Bezos actually offered to buy Netflix and you declined it. Could you take us through what happened there?
- [11:36]
Reid Hastings
Let's think about the dates. Late 90s, and we went and talked with them. It never got to like a formal offer. It was sort of exploratory. And, you know, they were properly interested in all businesses that could show a profit. And here's the shocker. We said no. And then we worked our ass off for 20 years. Okay. And then if you compare the stock return, you know, if we had sold and then just ridden the Amazon stock up in the same outcome. 20 years of work, and now, of course, I'm happy, you know, create Netflix and that kind of thing.
- [12:09]
Ed
Yeah, absolutely. And my favorite detail along those lines, so Netflix is growing, it's doing super well, it's on pace to go public. And then the dot com crash hits and it brings down all these companies, and that includes Netflix. And you actually tried to sell the company to Blockbuster for $50 million and they rejected you. So I'd love to hear the story of how that went down.
- [12:37]
Reid Hastings
Yeah, I mean, that one was more avoiding a big fight with Blockbuster. We realized that if we're to grow really big, we're going to have a big fight with them. And how about if we just give them 50% and then, you know, help them profit and not have that big fight with them? And so we were open to that, but, you know, they're like a big, serious corporation. We were a bunch of scrappy Silicon Valley kids and they were like, you know, when we want to do online, we'll just do it. And so they didn't see any need, you know, or interest in buying us. And then they did compete like us with us, like heck. And luckily that didn't start until 2004. So they waited an awfully long time because they weren't sure the market size. But then they got quite serious and it was a huge price battle in 2005 and 2006, and then they ultimately bankrupted themselves by 2007 or 8.
- [13:36]
Ed
I feel like in the history of video, the way that Blockbuster is remembered is they sort of dropped the ball. They weren't Focused, they weren't managing themselves correctly and that you came in and ate their lunch. Do you think of their strategy that way? Do you think that they sort of slacked off and that's where you. And you've basically picked up the slack. How do you view your takeover of Blockbuster in that story?
- [14:05]
Reid Hastings
High respect for their leadership. Very smart, thoughtful people. They rolled up the business, beat all their direct competitors through kind of careful and good execution of story based video rental. Negotiated great deals with the studios. When it came to looking forward, they were very forward looking. And they did a deal with a broadband company in 2000, long before we were streaming. Okay. We didn't start streaming till 2007. Okay. So in 2000 they do a deal with a broadband company to be on the leading edge. Unfortunately for them, the name of that company was Enron. Okay. And it turned out to be this, you know, billion dollar loss that was a scam. So they kind of learned, you know, Internet, you know, is a bunch of scam artists, you know, and so they were more scared off. So then we came in with DVD by mail and it seemed like, you know, an interesting little business. But again, they were looking for how to go direct to consumer and they didn't want to do this intermediate step. It's hard when you've got one business model you've done in their case for 25, 30 years. And then there's a once in a generation change that is the Internet, you know, like Netflix hasn't. Yeah, I guess streaming. I mean, we were born to do streaming and thought about streaming all the time. So it wasn't hard for us to let DVD go. But I think if DVD had been the vision, you know, it would have been a lot harder.
- [15:42]
Ed
It was a long time before you actually started streaming. Were you constantly telling the team, you know, ultimately this is the goal. Ultimately we're going to get into streaming. This is just phase one.
- [15:53]
Reid Hastings
Yeah, for sure. I mean, we launched in 97, 98 and 2007, a decade later was our very first streaming. And that was just a Windows PCs with crappy content. Okay. So it wasn't until 2009, 2010 that we had the Xbox deal. So you could watch Netflix on your TV if you had an Xbox. And we had the Starz Online content, which is like a baby hbo. And so then it was like real content and on the television. And then it was like another five years before we were integrated into most televisions. And then we got our button on the remote, the Netflix button. And then we started, we did our original content first in 2012, so that was House of Cards. So yeah, there was a lot of steps in there that took to put together. So it's an unusual entry strategy to build a business to be the segue. That is where we're going to build DVD rental and then be in position for Internet streaming. But we were differentially confident that DVD by mail was the best solution for a decade and then when it came in with streaming we were super hungry for it. And then of course with that we could expand globally.
- [17:14]
Ed
We'll be right back.
- [17:28]
Scott
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- [20:47]
Ed
We're back with first time founders. Was it difficult to convince your team of all of this? I mean it sounds obvious now. Yeah, of course people will be streaming, but I feel like back then you're sort of making a, you're making a gamble, you're making a bet. I'm just interested. You say, you know, we were confident of all of this. Was it all of you or was it just you? How did you convince everyone this was the right way to go?
- [21:12]
Reid Hastings
No, it was pretty broad that. So YouTube started in 2005. We could start to use streaming. That was the first low quality but high scale streaming. So you know, there's like little things like should we, how much should we invest? Should we invest, you know, 30 million or 300 million in streaming in a given year. So you know, but I'll call those technocratic decisions. It wasn't, nobody thought we shouldn't invest. It was just how fast how early those kind of things.
- [21:47]
Ed
I feel like one of the things that makes Netflix so unique is that it's basically been on the forefront of pretty much every major secular shift that we've seen over the past several decades. And it's probably been on more of those than any other company in this generation. I can just go through the list. I think it's worth just listing for people. You know, you had the VHS to DVD shift. You had brick and mortar to delivery one time purchase to subscription based DVDs to streaming and then more recently licensing to original content and then even more recently domestic content to international content.
- [22:28]
Reid Hastings
Crazy. Crazy, isn't it?
- [22:29]
Ed
So it's basically front running every single major shift in the industry. And that to me has been the differentiator with Netflix and the trend. What do you think you have done as a leader that has enabled that level of innovation over such a long time? I mean, a lot of people innovate, a lot of people do new things, but you've been consistent in every single one. What do you think you've gotten right?
- [22:58]
Reid Hastings
You know, I try to think through from first principles why certain companies grow and thrive and you know, when they get left behind or when not. So I've always been a fan of kind of studying. You know, when I was growing up it was in the computer business. It was sun and you know, Microsystems and it was HP and they were and Digital Equipment. These companies were dying right and left and they were major companies initial for a while. And so I early on got a very close study of major companies shift with the ground shifted out from under them and how unusual it was to be Microsoft or others that continued to pivot with the new landscape. And so I think I've always been a fan of that strategy thinking learned mostly by watching other companies. Because if you learn it on your own companies, that's expensive. So it's better to look and see when you see a company do big pivots like Microsoft has over 40 years and they've missed some too, right? They're not, they're not perfect in it.
- [24:15]
Ed
One of the pivots that you made, I mean, so from DVDs to streaming. I was just looking back through the, through the time machine. You decided to rebrand the DVD business to Quixter and the streaming service was going to remain Netflix. And I just pulled some headlines from that year. Kwikster is dead. Quickster goes quickly. And here's my favorite from the Atlantic. Five reasons why Kwikster is now Deadster. That to Me is sort of like an example of where, you know, a pivot could kind of go wrong, but ultimately it was successful. I'd love to just get your reflections on pivoting to streaming. An initial failure, it seemed, and then it worked out big time.
- [25:03]
Reid Hastings
So we, in studying other companies, we realized they're run by good people and they still miss the transition. So the average smart and careful leadership team is too slow. And so we thought, okay, we've got to go faster than we're comfortable, okay? And the phrase internally was, we got to be so aggressive that the hair in the back of our neck is raised up. It's really scary. And that allows us to say, okay, let's take all of the DVD rental business and shove it to the side into Quickster. And the only thing remaining and we knew would be streaming. And but at that time, 2012 streaming was still not very good and still not very broad. And so we were very aggressive. And it was too aggressive for the customers, okay? We didn't, you know, they care about the here, I mean, I'm paying you 20 bucks a month. I want, you know, what I want. And so we were ahead of the customers. And then that cost us a lot. You know, the stock shrank by a lot, customers quit us, the press thought we were idiots. And so. And it was too fast in hindsight, okay? But think of it as the aggressive spirit that allowed us to do all those transitions you referred to a few minutes ago was the same aggressive spirit that makes us go a little too fast with Quickster, okay? And then ultimately you're right, it became dvd.com and we did the thing and, you know, and separated it in a more low key way. And then, you know, it was just last year we finally closed dvd.com so, you know, it's the right idea too soon. But if you think about it, these things are uncertain. And so if you make five decisions a little bit late and one a little bit early, you know, you're sort of in the same range. So we didn't beat ourselves up too much on it because we were like, look, you gotta be aggressive. You gotta be able to recover if it's been too fast. But you can't be afraid of moving too fast.
- [27:09]
Ed
Why is that exactly? Why do you think that it's so important to be aggressive? I think that, I mean, I agree in hindsight, I mean, I'm glad that you were aggressive, but I feel like it's very easy in business and in life to think, well, you know, things are going well. And we don't want to disappoint our shareholders and we don't want to disappoint the customers. And it's just so interesting to me that you were very, very sure that no, no, no, we have to move extremely quickly. Why was that so important to you?
- [27:38]
Reid Hastings
So some people are tall or short. Some people are risk sensitive or risk loving. Okay. Honestly, I think it's as it's built into people's biology. And I've always loved the fear and excitement of the going fast. I do think it's helpful if you take smart risks. Obviously, if four or five of the big decisions we made were as bad as Quickster, then there's a problem. You've tipped into being wrecked. Reckless. Okay. But if mostly you get it right and if you can recover when you've been too fast, then that's just aggressive and not reckless. And so then, you know, you can get great returns. Like Netflix has been cultural principles, and.
- [28:24]
Ed
Company culture has been such an important part of what you built at Netflix. And now many companies around the world have borrowed a lot of your principles. I'd love to just go over a couple of them and hear from you what they mean and why they're important. First one I've got here is farming for dissent.
- [28:41]
Reid Hastings
Yeah, that's one actually we brought in after Kwiksterk. It means that dissent in a management team is not easy or natural, especially if the leader has a strong view and has often been right. And so it's important to farm for dissent and to stimulate mechanisms by which contrary views can be evaluated and heard. We're not trying to manufacture consent. Okay. We're trying to stimulate dissent up to a point. And then you make a decision and then you want everybody on board to execute it. Like heck.
- [29:19]
Ed
What is that point you said up to a point. Where do you cut it off?
- [29:25]
Reid Hastings
So for big decisions, it's a somewhat formalized process where we'll have a meeting and then everyone enters their view and a Google spreadsheet sheet that's visible to everybody and you vote on things. Negative 10 is like, it's going to be a disaster. To zero is like, I'm not really sure. To 10 is. This is the best thing we could possibly do. I'm very confident. And then whoever's making the decision then writes up. Think of it like a Supreme Court decision. I mean, it's not as well written or formal and stuff, but it's. Here are what I heard, here are the different views. And ultimately, I think the balance of risk is this. And I think we should do why. And then that's the decision and then we move forward.
- [30:08]
Ed
The other one I have here is extraordinary candor. What does that mean?
- [30:12]
Reid Hastings
Well, human beings as we've lived in denser and denser groups have learned to be more and more polite and indirect. So you know, in China or in Japan where it's very crowded, people are super polite and you know, it's an art form. The challenge in that in business is we come from a lot of different cultures and we're moving fast. And so it's better to enable people to be rude by conventional standards and to be very direct, at least about the workplace, not about your clothing or you know, that you're attracted to someone or I don't know, you know. But again, on the work dimensions we want high candor to get people to have more, more clear, effective and honest discussions about, you know, should we cut price in France or should we do this show or should we do this product feature.
- [31:09]
Ed
Just going to move through one more cultural principle here which is the keeper test. What is that?
- [31:14]
Reid Hastings
The keeper test is if someone was going to quit, would you work hard to keep them to change their mind? And so it's using that as the firing criteria area rather than the traditional. Have they screwed up so egregiously that we should fire them? Okay, that's kind of the default model and we would say no. We'd like to have a whole bunch of people that you would fight hard to keep and you're responsible to all of your direct reports are people that you would fight hard to keep.
- [31:45]
Ed
We'll be right back.
- [32:00]
Scott
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- [33:39]
Sequoia Capital
Support for the show comes from the new season of Crucible Moments, a podcast from Sequoia Capital. What is a Crucible Moment? It's a turning point where we face a tough decision and our response can shape the rest of our lives. These decisions happen in business too, and Sequoia Capital's podcast Crucible Moments gives you a behind the scenes look, asking founders of some of the world's most important tech companies like YouTube, DoorDash, Reddit, and more to reflect on those critical junctures that defined who they are today. Tune into season two of Crucible Moments today. You can also catch up on season one at cruciblemoments.com or wherever you listen to podcasts.
- [34:27]
Ed
We're back with first time founders. I'm going to move on to leaving Netflix. In January 2023, you stepped down as the CEO. Your co CEO Ted Sarandos stuck around. He remained at the helm. Greg Peters was promoted. And when I look at what happened here, to me, this is kind of one of the greatest succession stories of this decade because I look at what happened to Disney, what's happening right now at Nike, what's been happening at Starbucks. I even look at what's happened in our government and what I'm finding is that the transition of power is extremely difficult. But if you look at what's happened with Netflix, Netflix has crushed it. The stock has, I think roughly doubled since you left, which is actually a testament to your ability to formulate a plan. What makes a good succession plan? How does a leader such as yourself peacefully and successfully remove themselves from the helm?
- [35:32]
Reid Hastings
You know, it's something that we always have concentrated on, which is developing bench strength. And Greg and Ted, you know, been with me for 19 years or something, so it's like they were very ready and very excited to have the shot, you know, to lead. But again, I think that's, you know, again, similar to the Andy Jassy, you know, following Bezos. So I bring that up just to say, you know, there are other proof points of. I mean, Jassy's been at Amazon for 20 years, you know, and he's different than Bezos, but, you know, he's doing it his way. And, you know, there are those companies that struggle, you know, where the board and the CEO either didn't pick right or took a long time or, you know, a range of tricky issues.
- [36:16]
Ed
And was it hard to let go of Netflix?
- [36:20]
Reid Hastings
Yeah, you know, I'd done it for 25 years. Every day jump up early to check the metrics and be in charge. And it, you know, was a big shock at first, but, you know, I knew that this was a great time for them to take over because we had a great recovery path that they architected, you know, for the company. But on a personal basis, I missed it. I missed being the center. I missed the, you know, the influence. I missed the intensity, missed the global, global travel. But, you know, three months later, I took over Powder Mountain. And, you know, that's been an incredible adventure. And then, you know, do a bunch of philanthropy and, you know, more active on that side. So I've been, you know, really blessed to continue to feel very invigorated.
- [37:06]
Ed
It's so interesting to me because who would have thought that the entertainment Internet software entrepreneur would decide, you know what, I'm going to go start a ski resort.
- [37:20]
Reid Hastings
My wife and I had a home here, a powder already. So it's not like I searched 50 mountains and found the right one in some great strategic play. We had a house here. We could see the mountain was struggling. The opportunity to buy out the existing owners came up. And really, most ski mountains are real estate development projects. That's the, you know, skiing itself is, you know, very tough business, like restaurants, that kind of thing. And then it's creating the real estate play that's been so exciting.
- [37:54]
Ed
I'd love to know if there are any similarities between operating a ski resort versus a streaming service. What are sort of the main differences in the experience, but more importantly, what are the main similarities? What's sort of carried over?
- [38:09]
Reid Hastings
Yeah, the similarity is really the subscription orientation, which is you've got a set of customers and your job, you know, is to keep them excited, and so you're not trying to get new customers all the time, like a transactional business. So it's really focused on those that own real estate or have season passes. And so that's probably the biggest similarity in business model. Then there's a lot of similarities in culture now where we're building up Powder Mountain to do keeper test and high compensation and all of the things that we've learned before. And then we've shaken up the model so, you know, we've split the mountain in half. Half for private, half for public. No one had done that before. We did a thing a couple days ago where we said on February weekends, which are the busiest times, it's season pass only days. You know, we're continuing to find ways to innovate. But I would say in the ski industry, the great popularizers have been the Epic and Icon passes. They're the ones that roll up, you know, 50 resorts. Think of them as the or Amazon Prime. Okay, that's like super high scale. I mean, I would have loved to invent that business, but I didn't. It's been going on for 10 years and now we're competing now in the irony of ironies, on the niche provider competing with the dominant firm and trying to come up, as we have, with something that's counter positioned. And Epic and Icon have made skiing more affordable, but they've made it really crazy. And so then we're the counter to that. We're more expensive, but we're like beautifully pristine and open and it's more like hella skiing.
- [39:59]
Ed
It sounds absolutely incredible. I mean, the real difference here is this is really about bringing yourself joy. It seems. This is about spreading happiness and having a great time. It makes families happy, it makes you happy. And I think that's significant, that that is what you've decided to zero in on and make a whole operation out of. So I'd love to get sort of your thoughts on joy, on happiness, and the extent to which that's played a role in your career and the decisions you've made throughout it.
- [40:34]
Reid Hastings
You know, I would say finding new angles on existing businesses. You know, whether that's rental or, you know, software error detection or this one. You know, skiing is the exciting thing coming up with new business models that, you know, work really well. In our case, to have 600 families have the private skiing and then use that to anchor the mountain and the public side with, you know, thousands of season passes. And it's got all the joy for me of Netflix, even though it's a fraction of the scale, a fraction of the profitability, a fraction of, you know, things that are important. In many ways, but it's a fun problem to be engaged with and, yes, to create again. But the joy we create for our members is. It's very visceral and, you know, we get to know them and that's, you know, deeper than just, you know, someone writing you of how important this show was to see them. But that was fun, too.
- [41:35]
Ed
As you look back at this very wide range in Korea, which parts were the most rewarding in your view?
- [41:43]
Reid Hastings
I'd have to say right now, I feel most rewarding because, again, it's my neighbors that are, you know, that we're saving the resort for and expanding and growing and putting in like, this year we're putting in four new lifts and like, nobody goes that aggressive all at once. It's crazy in a way. And yet we're pulling it off. Even though, if I'm objective, it's not as much good in the world as say nothing Netflix, it feels very intense because I know the people.
- [42:14]
Ed
There's a community aspect. Yeah, yeah.
- [42:16]
Reid Hastings
I would say the personal satisfaction is highest now, probably in terms of world impact, then Netflix would be the highest.
- [42:25]
Ed
And what about your philanthropy and your ventures in education? What has that brought you on a personal level?
- [42:33]
Reid Hastings
What I found the year I did, the politics is it's good for the world, but I wouldn't jump out of bed to do it. You know, I jump even today with a philanthropy, I like it. It's important. I'm doing a bunch on charter schools, a bunch on AI learning, a bunch on lower cost mobile phone access in Africa, home solar. So I recognize it as important. But, like, if I have an hour, I jump into powder mountain stuff, you know, because it's just. It's such a great group of people, both, you know, on the staff and then in the membership.
- [43:10]
Ed
It's funny hearing you talk about this because it's so clear to me that you get hyper, hyper obsessive and focused on very specific things. And right now, you know, it's the ski resort. This is what's dominating. It feels like that sort of gives insight into why you've been so successful in all of your ventures is that you pick a thing and that's your thing. I guess the other word for this is focused. How has that played into your career? And do you think that's something that other people who want to be successful should be embracing more of?
- [43:46]
Reid Hastings
Well, what I realized is there's other ways to be successful. Like my friends who are venture capitalists. They're the opposite. They've got 30 deals contemplated, five deals they're in. And they're incredible at multitasking and the ones who are very good at it. And I realized it's just not my personality. And so I think a lot of it probably for the young entrepreneurs, figuring out what really are they differentially good at. So, yes, I'm a focus person, but I wouldn't say that's the only way to be. You know, I would say in the investor class, they can't jump in and try to solve the problems of the company. There's different ways to contribute in different parts of the ecosystem.
- [44:31]
Ed
There are a lot of young men who listen to this podcast. As a businessman, as a family man, and as a philanthropy man. What would be your number one piece of advice to a young man who's just getting started in his career?
- [44:48]
Reid Hastings
There's no one path to imitate and sometimes people fall in the trap of like finding their role model. And you know, and I would say it's staying loose and flexible in learning and trying things and it's always challenging yourself. If you're growing in your skill set, then you're going to have lots of opportunity, but there's no predictable path. So it's more of an emphasis on growth and growth mindset than on preparation and having a plan.
- [45:25]
Ed
It's interesting. Do you feel that you embodied that through your career as well?
- [45:29]
Reid Hastings
Yeah. No. It was being flexible and adaptable and it was a very, very unpredictable angles and where things veered. And then I was fortunate to latch into some big problems, whether that's software quality or whether that's streaming entertainment or now powder real estate.
- [45:53]
Ed
And if there's one piece of advice that you could have given yourself when you were a young, young entrepreneur, before you started pure software, is there something that you would have told yourself that you'd like to tell him now?
- [46:08]
Reid Hastings
I didn't understand how to forgive myself when I made mistakes. So, you know, I was always going fast, taking chances, doing things, but. And now I'm able to see some mistakes as part and parcel of, you know, being aggressive. But at the time, anytime I made a mistake, I would berate myself endlessly and unproductively. So I didn't know how to forgive myself.
- [46:40]
Ed
I mean, you said unproductively berating yourself. Is there a way to think of self criticism in a more productive way that actually helps you move forward?
- [46:51]
Reid Hastings
My hunch is it just comes with age and that there isn't really a shortcut. So, I mean, you can understand the intellectual theory, but in terms of the emotional release. And you know, when you're younger, all those emotions are so intense, you know, about success and failure and esteem and humiliation. And you know, our systems are keyed up for that in ways that makes people very hungry. But I would say as you get experience, learning how to forgive yourself would be the little bit that I might be able to add to your audience because I'm sure they're quite good risk takers and they're quite aggressive and they're good about learning and growth and lots of things.
- [47:33]
Ed
Absolutely. I love that and I will take that moving forward for myself as well.
- [47:38]
Reid Hastings
Ed, when are we going to get you up skiing?
- [47:40]
Ed
Oh my God. I'll come tomorrow as soon as the ski season starts. I want to do it.
- [47:46]
Reid Hastings
Great to get you up this winter and we should do a little event maybe with you and Tim Ferriss, who's local too. He's Park City.
- [47:54]
Ed
I would absolutely love that and I love Tim Ferriss. Reed Hastings is the co founder and Executive Chairman of Netflix. He is also a majority owner in Powder Mountain and I hopefully will be skiing with him soon enough.
- [48:07]
Reid Hastings
Awesome.
- [48:07]
Ed
Reid, thank you so much for joining me on the podcast.
- [48:09]
Reid Hastings
Thanks so much Ed.
- [48:15]
Ed
Our producer is Claire Miller, our Associate producer is Alison Weiss, and our engineer is Benjamin Spencer. Thank you for listening to first time founders from the Vox Media Podcast Network. Tune in tomorrow for Profg Markets.
- [48:40]
Sequoia Capital
Support for this episode comes from AWS AWS Generative AI gives you the tools.
- [48:45]
Scott
To power your business forward with the.
- [48:47]
Sequoia Capital
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