Reed Hastings

Hastings had already founded and sold one company — Pure Software, to Rational in 1997 for around $750 million — before Netflix, and he has said he started the second one partly to fix the management mistakes of the first. The founding story of the $40 late fee on Apollo 13 was, by his co-founder Marc Randolph's account, invented for the press; the real origin was Randolph's list of things that could be sold by mail and the discovery that a DVD survived the post. Randolph was the first chief executive. In 1999 Hastings told him, in a conversation Randolph has described in detail, that he should step down and that Hastings should run the company. Randolph agreed, and left in 2003. The two accounts of that conversation differ in tone and not in fact.

His strategic record is essentially two acts of deliberate cannibalisation. The first, in 1999, was the switch from pay-per-rental to a subscription with no late fees, which attacked Blockbuster's largest profit line with a model Blockbuster could not copy without dismantling itself. The second, in 2007, was launching streaming inside the DVD subscription at no extra charge, while the DVD business was profitable and growing — and killing a set-top box Netflix had already built, because he decided Netflix should run on every device rather than compete with them. The team that built the box became Roku. He then spent a decade borrowing to make original programming, on the theory that licensed content would eventually be withdrawn by the studios that owned it. It was.

The two blemishes are Qwikster and the culture. In 2011 he raised prices 60% and announced that the DVD business would be separated into a company called Qwikster with its own website, queue and billing; 800,000 subscribers left, the share price fell about 75%, and he withdrew the rename within a month while keeping the price rise. He has called it his worst decision and also, with some justice, a reasonable idea executed with contempt for the customer's convenience. The culture deck he published in 2009 — freedom and responsibility, unlimited holiday, the 'keeper test' under which managers are told to fire anyone they would not fight to keep — became the most widely read management document of its era, and is also a description of a workplace that many former employees have called fearful. He stepped down as co-chief executive in January 2023 and became executive chairman, then non-executive chairman in 2025.