'When entrepreneurs implore you to remember OPM, what they're saying is: when it comes to financing your dream, use only Other People's Money'
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What sort of mind does it take to champion an idea into an international mega-business? What sort of ethic? What ideology? What needs to go right, and what needs to go wrong?
In the world of business, the strength of an idea is illusory, foreseeable only in a theoretical sense. This fact defined the seething primordial soup of hope and opportunity that was the tech start up scene of the late nineties, in the earliest sparks of the World Wide Web.
"The truth is that for every good idea there are a thousand bad ones. And sometimes it can be hard to tell the difference."
Today, that Netflix should dominate - that it should have shunted the brick-and-mortar, "managed dissatisfaction" model of VHS Blockbuster by the wayside and brought streaming to the fore - seems obvious, but not in 1997. In fact, the Netflix of those early days dealt, not in streaming, but in the online rental of physical DVDs, mailed out across the USA. This, at a time when DVD players weren't even sold in the US. In the beginning, Netflix was a company banking entirely on what the world would be, rather than what it was.
'When he said yes, both of us knew it had nothing to do with the idea. Steve told me later that he had said to himself, "Well, that's $25,000 I'll never see again."'
That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea is pretty much what it promises to be: a window into the boom-bust, gambler's paradise of late 1990s Silicon Valley and a tour through the ideologies, rituals, and often wilfully heedless logic atop a successful tech start up.
"'Fifty million,' Reed finally interrupted. ... It was tiny, involuntary, and vanished almost immediately. But as soon as I saw it, I knew what was happening. John Antioco [CEO of Blockbuster] was struggling not to laugh."
This biography of Netflix's early life, authored by its founder and first CEO, traces the company from its inception in 1997 to its initial public offering (IPO) in 2002. This is a Netflix worth in the low millions and tens of millions, not posting billions in profit. If you are interested in the characters, cultures, rituals, and battles of a high stakes tech-start up in the early 2000s, this book has that in bulk, delivered in clear, personable, and amusing language.
But this is not the full story of Netflix's meteoric rise, this is its path from an idea to the shimmer of what it would become - as Randolph says, to the little David that would best Blockbuster-Goliath. If that's the battle you want to see, you'll find the opening volleys here.
- That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea, by Marc Randolph. Hachette, $32.99.