Marc Randolph, Cofounder of Netflix.com, is no stranger to starting new businesses.
Before starting Netflix with his business partner, Reed Hastings, he already founded five other ventures.
“I knew that my next company would be selling something on the Internet,” says Marc. “But the ideas that I was pitching to Reed were all over the place.”
The two partners were exploring broad ideas, from a pet food online store to a personalized shampoo brand. Yet, the ideas all had one common denominator: selling on the Internet and personalization.
One of those ideas happened to be video rental by mail.
Test cheaply. Test fast.
A startup is a group of people in search for a repeatable and scaleable business model. But this shouldn’t be the goal in the beginning, according to Marc.
“Back in our days, to go from idea to validation was six months and a million dollars.”
So following his own advice, he decided to rent a DVD and mail it to himself using priority shipping. With less than $10, he was able to validate the core function of Netflix’s business and gain conviction to begin executing.
“Now with the Internet, an entrepreneur can try 50 different things in a week to validate their business,” says Marc. “The distance from idea to validation is no longer six months, it’s six hours.”
Know what you’re bad at
A pivotal moment of Netflix’s path was when Marc stepped down as a CEO. But Marc describes this experience as a heartwrenching one, at best.
“It was six o’clock at night, and Reed pokes his head into my office, and tells me that we need talk,” says Marc.
Using powerpoint slides, Reed began to pitch why he’s best fit to be the future CEO of Netflix, instead of Marc. “At first, I thought he was firing me. But to his credit, he was proposing that they run the company partners.”
It was a hard pill to swallow, but Marc realized he had to give up one dream in order for another to thrive. “I had to take a step back and ask myself, what’s the most important dream here. To have a successful company, or for me to be running a successful company?” he says, noting that he realized that the dream of building a successful company was no longer just his anymore.
More importantly, Marc says that what he loves to do is to come into work everyday and solve problems. “When I reflect back, I realize that I’m great at the early-stage of building a business, but I’m terrible in the later-stage,” he adds.
The key takeaway is that as entrepreneurs, we need to be self-aware of our own strengths and weaknesses, and let someone better take over your current duties.
As Marc concludes, “a funny thing happens when your business starts to become successful. You can find people that are way better than you at your job.”