Blitzscaling 16: Reed Hastings on Building a Streaming Empire

This is my 13th  blog on the notes and my interpretations on the Blitzscaling sessions. In the fall of 2015, Reid Hoffman began taking session called Technology-Enabled Blitzscaling at Stanford University.Blitzscaling is what you do when you need to grow really, really quickly. It’s the science and art of rapidly building out a company to serve a large and usually global market, with the goal of becoming the first mover at scale. And its also about why organization culture is important for Blitzscaling. Because when you’re growing an organization very fast, you have to make people accountable to each other on a horizontal or peer-to-peer basis, and not just vertically and top-down through the hierarchy.

The previous blog related to Blitzscaling is here.

In this session, Reed Hoffman interviewing Reed Hastings, the Co-Founder and CEO of Netflix. And the most sought-after mentor of silicon valley shares his mantras of building the culture and scaling the company.

  1. Netflix culture deck is the most evolved culture decks out their. And here are the details of the deck for you :

  2. Putting your culture in writing not only helps you to get right kind of people in your team, it also makes the entire thing more debatable to get more understanding. At Netflix, every new employee goes through the deck to understand about the company.
  3. With the right kind of density of people in the company, you need less processes to manage them. More the people, more processes are required. Reed call this as “Right Talent Density”.
  4. Your manager should always be giving the context of why they are doing what they are doing. And then just give them autonomy to people to execute freely.
  5. Reed highlighted that NefFlix company culture is different from Google. And he emphasised that one company culture is different from another. Organization culture is an expression of what you and your senior leadership want to be. Thought I believe that while it’s important to define that expression of what you want to be, it is also very important that it should be aligned with what your customer wants from you as an organization.
  6. You can only have a strong culture in your company if you can have a strong & clear mission. The funny thing about mission statements/plan is that “it doesn’t wort rk out most of the time”. But one thing it for-sure helps in to help the current and prospective employees and customers see what company want to achieve in next 5 to 10 years.
  7. When attacked by the big competition, focus on your core rather than expanding the offering; because it will further lead to more fronts to fight the battle.
  8. Being too intellectual to your customer on why you are offering what you are offering doesn’t work, as customer care doesn’t care about that. Your customer care about value, price and service.
  9. “The only prediction about the future that comes out to be true is that prediction itself will be wrong”. When Netflix was seeking funding in 1997,  they thought that online video streaming will pick up in next 5 years by 2002. By the time 2002 came, internet bandwidth was still at the nascent stage. So they thought & projected that by 2007, online streaming will be contributing 50% to their business. But it was still ZERO after 2007.
  10. The right time to become an entrepreneur is when you got the idea that to make it work you are ready to go and touch the poverty line. Or other way around is when you can’t get that idea out of your head for next 1 to 2 years.
  11. You can’t let friendship come in the way of professional or business judgements. So when you are hiring your friends or friends of friends, just make sure of this thing.
  12. Use more data when you are picking stocks, but less data when you are picking your spouse or new hire.
  13. As a CEO, you have to invest in yourself on the continuous basis. Because when you become better, your company become better. As you grow your company, you focus on creating the culture, mission/vision, hiring right guys so that they can hire right guys further. To make this all happen, you need to improve every single day.
  14. There is no right answer whether you can become an entrepreneur or not. From Reed perspective, if you have got a strong grit and if you are a generalist who can do multiple things(most of it will be very boring) for many years to come, you can try your luck.
  15. The biggest mistake you can do in your life or as a founder is try and to be someone else. So all Steve Jobs lovers, it fine to read about him and get inspired, but dont want to be one.
  16. Successful teams and employees act like a sportsman/women. Treating your employees like family means you probably need favour’s from them or want them to work for you cheap.

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