Marc Randolph’s Post

Ask Marc Randolph (Co-Founder of Netflix) - Live Q&A May Turn your videos into live streams with Restream https://restre.am/ANIm Get answers to your burning questions about growing, running, marketing, and 10x-ing your business during our live Q&A event with the co-founder of Netflix (and frequent investor from our show "Entrepreneur Elevator Pitch"), Marc Randolph. Feel free to ask questions in the chat during the show and we'll try to address them!

You can’t learn a language without speaking it. You can’t learn golf without hitting golf balls. So why do you think you can figure out if your idea is any good just by thinking about it? It’s the most important personality trait of an entrepreneur; Do more and think less. I’m not sure if it’s nature or nurture, but the best entrepreneurs have figured out that time spent thinking through permutations of an idea is wasted time. The most effective thing they can do is stop thinking about an idea, and start working on a quick, cheap and easy way to test it. 23 years ago, when Reed picked me up for our morning commute and mentioned he had heard about a new technology called the DVD, it didn’t take long to realize that it might be the key to the video-rental-by-mail idea we had been kicking around. But rather than racing to write a business plan or build a pitch deck, we turned the car around, drove to town, bought a music CD, and mailed it to Reed’s house. In less than an hour of effort, we learned more about the validity of our idea than we would have from a month of “studying the problem”. It’s such a simple solution: Just Do It. But surprisingly few people do. I don’t think it’s laziness. Instead, I think it stems from the discomfort most people feel doing something they think may not work. It’s human nature not wanting to embarrass yourself by flailing or failing. artwork by Brendan Leonard

Blockbuster almost won. We got incredibly lucky. But we worked incredibly hard. And that intersection of luck + hard work is where magic happens:

I’ve gotten a lot more followers over the past two years, and that’s a really good thing. But it’s also made me realize that I have to be especially careful about what I say. These days, almost every one of my LinkedIn posts gets more than 100,000 views—and some get many more than that—and it terrifies me. I worry that people will misinterpret my advice, or worse, think that by "doing what Marc did" they’ll end up with another Netflix. And it's not just me. There’s definitely a huge element of survivor bias in all the advice dispensed by "successful" entrepreneurs. For every success story you read about, there are probably a hundred (or more) entrepreneurs who crashed and burned doing nearly the same thing. But you don’t hear about them, because…well…they crashed and burned. I almost feel like every post I make needs to have a Surgeon General's warning: "Warning: Although Marc dispenses advice, he freely admits that he's not sure whether things worked because of what he did, or in spite of what he did." Or perhaps I should just use what you see on every investment prospectus: "Past performance is no guarantee of future results."

The most powerful step that anyone can take to turn their dreams into reality is a simple one: you just need to start.  But… what happens if it doesn’t work? What happens if your test fails, if nobody orders your product or joins your club? What if sales don’t go up and customer complaints don’t go down? What if you get halfway through writing your novel and get writer’s block? What if after dozens of tries – even hundreds of attempts – you still haven’t seen your dream become anything close to real? If that’s what you’re worried about, here’s my advice: you have to learn to love the problem, not the solution. That’s how you stay engaged when things take longer than you expected.

I’ve learned that the single biggest reason for failure is never starting.

Before I became a tech entrepreneur, I was a direct marketing guy. I mailed tens of millions of letters and catalogs each year. Living in the US, I was convinced that the vendors I was using to get these mailings out were the most sophisticated there were. But then I moved to Europe. The equipment that vendors used there was way beyond what I was used to. But it wasn’t because they were more experienced in direct marketing. Quite the opposite: they were more sophisticated because they were new to the game. Every one of my US vendors was making do with stuff they’d bought six to 10 years ago. But nearly everyone I worked with when I was in Paris had the most recent model of everything. This phenomenon of turning a lack of access into an advantage has plenty of precedent. It’s even shaped history. In 1918, at the close of WWI, the defeated Germans were required to destroy or surrender nearly every piece of military hardware they had, from rifles and ammunition up to ships and planes. By the 1930s, Germany had the world’s most sophisticated army, since they’d had to re-arm entirely from scratch, while the rest of the world hung onto their “perfectly good” older equipment. When we started Netflix in 1997, Blockbuster had already spent over a decade building physical stores—9000 of them—across the country. Prospective investors pointed to this and asked, “Why would anyone rent DVDs by mail when there’s a Blockbuster down the street?” It seemed like a good question at the time. As Netflix slowly siphoned customers away, these stores turned out to be a massive liability. Because of their overhead, losing even 10% of a location’s revenue turned it unprofitable. And Blockbuster was locked into a brick-and-mortar footprint, making it impossible to reduce costs. Eventually their entire economic model turned upside down. The fact is, any well-established company is going to have this kind of weakness: an existing product line, a “good enough” code base, a line of distributors to keep happy. You can offset this by “scraping the barnacles”—periodically reviewing where you’re investing time and effort, and cutting what’s not working—but it’s always going to leave you vulnerable to smaller, nimbler competitors. On the other hand, if you’re the scrappy startup, don’t worry so much about the resources or finances of entrenched competitors. You can often take advantage of what’s holding them back.

What problem are you trying to solve?

I am firmly convinced there’s no such thing as a good idea. Every idea is a bad idea. No idea performs the way you expect once you collide it with reality. And the more I learn, the more I believe that it’s true — making this video Steve Jobs so powerful to this day.

Ask Marc Randolph (Co-Founder of Netflix) - Live Q&A April Turn your videos into live streams with Restream https://restre.am/ANIm Get answers to your burning questions about growing, running, marketing, and 10x-ing your business during our live Q&A event with the co-founder of Netflix (and frequent investor from our show "Entrepreneur Elevator Pitch"), Marc Randolph. Feel free to ask questions in the chat during the show and we'll try to get them answered!