Podcast

Episode 136 – Marc Randolph, The Birth of Netflix

Have you ever wondered what you would do without Netflix? This week we’re continuing our special series Decide, Don’t Slide: Living Intentionally as Life Begins to Normalize. Joining Jessica is someone whose work has helped all of us find entertainment during isolation and virtually escape during lockdowns this past year: the co-founder and founding CEO of Netflix, Marc Randolph. Marc is a veteran Silicon Valley entrepreneur, advisor, and investor. He is also the author of That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea and host of a new podcast by the same name. Today, Marc and Jessica discover how the story of Netflix is more than just the inception of a culture-changing business; it’s a lesson in living intentionally and making priorities for all aspects of life.

Transcript:

Jessica: Hey, everyone! Welcome back to the Going Scared podcast. This is your host Jessica Honegger, founder of the social impact fashion brand Noonday Collection. Join me here every week for conversations on living lives of purpose by leaving comfort and going scared.

Alright, today is such a treat. I admit, I was really nervous to interview Marc Randolph – why? Why was I nervous? Because he is the founder of Netflix. That’s right: Marc and his founding team fundamentally altered how the world experiences media, and I was really disarmed by him. He’s an incredible storyteller. He is a true entrepreneur.

He shares about his new podcast that he just launched called That Will Never Work, which is aptly named after his book, “That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea.” I got energy from this conversation with Marc. There is just something about speaking with someone who is in their sweet spot, who has understood what their priorities are, and is living into those.

I was super encouraged. I know that you will be too.

Marc Randolph: The Birth of Netflix

Jessica: Okay, so Marc, you are classified – I classify you as a serial entrepreneur. My dad would call serial entrepreneurs a special breed of cattle. Can you identify with that?

Marc: With being a special breed of cattle?

Jessica: Special breed of cattle.

Marc: I’m not sure. I’m not sure I wanna…

Jessica: We’re Texans. We’re Texans down here.

Marc: I’m not sure I wanna identify with that. But certainly, you know, I’ll certainly classify myself as being a serial entrepreneur. You know, it’s kind of a compulsive thing for me, and I’ve been doing it for a long, long time.

Jessica: So you’re most known as being the founder and CEO of Netflix, but I’m curious, what were some of those ideas or other businesses that you even had before Netflix came to be?

Marc: Well, it’s a long list. I mean, I didn’t start Netflix until I was 37 or 38, and it was my sixth startup. So, there was a bunch in between there. But even, you know, even if you say, “Okay, that’s a lot of companies,” but for every company, there’s 50 or 100 ideas that flash through your head. I mean, even for Netflix, that was not automatically going to be some kind of video business.

“I didn’t start Netflix until I was 37 or 38, and it was my sixth startup.” Marc Randolph

I mean, when we were brainstorming ideas for that, one of them was doing personalized shampoo. Another one was custom formulated dog food. I pitched an idea of doing personalized sporting goods like baseball bats and surfboards.

Jessica: That’s so interesting. So all of these ideas around personalization, which is absolutely where the marketplace has gone now.

Marc: Well, yeah. And this was… those ideas, I was pitching back in 19… wait, in 1997, ’96. But, you know, there’s a reason for it, is that for the first 15-plus years of my career, I was a direct marketing guy. You know, I did junk mail, I did direct response television, I did magazine circulation. I did all these things that were basically direct marketing and a big part of direct marketing back then was this primitive, we called it personalization, but it was pretty primitive.
It was like, “Dear Jessica, we want all your friends at 17 Crescent Circle to be delighted with the…” you know, they plug in these things to make it seem like they were speaking just to you but, of course, it was pretty lame.

So, you know, when – this is in the late ’90s, mid to late ’90s – and all of a sudden, I see the internet coming along and I kind of recognized that this was an opportunity to do direct response on steroids with unbelievable levels of personalization that were possible using the internet. And so, of course, the two things that I was fixated on my next company being was, number one, something to do with e-commerce, selling something on the internet, and I really wanted it to have a deep level of personalization to take advantage of what was then, a brand new technology.

Jessica: So how does Netflix fit into that?

Marc: Well, you know, this was a time when I was losing my job. The company number five that I had co-founded had been sold to a bigger company that had been started, was being run by a gentleman named Reed Hastings, who plays fairly prominently in the story from that point on. And I went to work for Reed’s company. And not, well, six months later, we decided to sell that company.

And the company we sold it to didn’t need Reed nor did it need me and both of us were gonna be on the streets. But, you know, don’t feel too sorry for me. This was one of those wonderful Silicon Valley kind of exits where they say, "We’re gonna buy the company, you’re not gonna have a job when it finishes closing but it’s gonna take six months to finalize this. You’re gonna have to come to work. In case you have any questions, we’ll keep paying you, your stock keeps vesting, you stay in your office…

Jessica: So crazy.

Marc: …but you have nothing to do." And so, for six months, I was going, "Okay, I’ll use this time to figure out company number six." And Reed and I, Reed had said he didn’t want to start another company. Reed was gonna go off and become an educational philanthropist. He was gonna change the world, which he has in a lot of ways besides his work with Netflix. But he wanted to keep a hand in so he kind of agreed to be my angel investor. We come up with an idea together and then I would sell the company.

Jessica: Would you mind breaking that down just for our listeners that are not entrepreneurs? Angel investor. I’m an entrepreneur myself. I own and operate – I’ve run a company for 10 years now, and previous to me starting the company, or as I was starting the company, I thought an angel investor was someone that was gonna write me a check just because they believed in my idea, no strings attached. That’s why I’m asking you to clarify for those that aren’t in the VC world.

Marc: It’s not a bad definition. I mean, now they call it… I guess you don’t really call it angel investing anymore, and I guess you do, sure, you do. They also call it friends and family, they also call it, sometimes, seed round. But it’s basically the money that gets invested before you’ve really proven that the idea works. And so to some degree, yes, it is people who are investing because they believe in you rather than what happens later where it’s so much driven by the numbers and the metrics and how well it’s done so far and what it’s promising to do. And so, for example, in our angel round for Netflix, it was Reed who wrote a check for $1.9 million and then we filled out the round, another little Silicon Valley term, which means how do you raise the rest of the money in small, small "checks" of $25,000, one of which came from my mother, one of which came from Reed’s mother.

 

The Future of Film Consumption

Marc: So, in some ways, it was people who believe in you. But as the story kind of unfolds there is that that was Reed was doing that because he kind of wanted to keep a hand in this startup game even though he was gonna go back to school and get a higher degree in education. And we were brainstorming ideas and one of the criteria was personalization, one criteria was selling something on the internet, one was big category, and one of the ideas amongst the dog food and the shampoo was, can we do video rental by mail.

Can we take the $8 billion video rental category dominated by Blockbuster back then and do it differently? And surprisingly enough, that idea was actually discarded too because back then, this is, you know, you may remember 1997, and if you don’t, someone can tell you about it. Video rental…

Jessica: Well, I was telling my kids today, actually, that I was interviewing you, they’re teens, I was telling them this morning, "Guys, guess who I’m talking to today?" And we had to explain, you know, Blockbusters to them. My husband had like, "Remember, we would go to Blockbusters," and my kids were like, "How much did that cost?" We’re like, "Well, I think it was about $3 but then we would never turn it back in on time." And anyway, so that’s for those of you that are young Millennials and Gen X, Gen Z-ers listening, yes, that we used to have VHS tapes and then we used to have to go to the store to rent. And so you’re coming into that space.

Marc: Yeah. And it was VHS tapes, is the point. They were big and they were heavy and they were fragile, and so that idea was abandoned too. And what actually turned it around was there was a new technology just coming out then, which is almost gone now, which is the DVD. And that was the thing which all of a sudden gave us the much bigger idea which is that maybe we could just use the U.S. mail to send discs to people. And rather than dreaming about it, Reed and I turned the car around mid-commute, because we were driving to work together, and drove back into the town we lived and looked to buy a DVD and couldn’t find that so we settled for buying a used music CD and we mailed it to Reed’s house in Santa Cruz where he lives and it got to his house in less than 24 hours for the price of a stamp. And if there was any kind of “aha” moment, that was probably it. And that was the big idea that led us to have the crazy idea that we should start a company that did video rental by mail.

Jessica: Okay. So you already have an angel investor in Reed, what do you do next? Because a lot of, you know, now Silicon Valley VC entrepreneurs start putting their deck together and go and start pitching but I think that you weren’t quite at that time yet. So what did you do next?

Marc: And quite frankly, that is not, these days, what Silicon Valley entrepreneurs do for real. That’s what they do on TV. That’s the fantasy view of what an entrepreneur does. What a real entrepreneur – like, for example, when Reed and I had that idea that DVDs might reenergize this video rental by mail, we didn’t run to the office and put together our pitch deck and nor did we begin working on a business plan. And that was not because Reed was gonna write the check, it’s because what a real entrepreneur does is figure out some way, immediately, to try and collide the idea with reality.

“What a real entrepreneur does is figure out some way, immediately, to try and collide the idea with reality.” Marc Rudolph

Jessica: That’s right.

Marc: Which is to stop dreaming and do something, and in our case, that was mailing the DVD. But there is a huge difference between 1998 and now in obviously lots of ways. But for an entrepreneur, if you had a technical idea, if you had an e-commerce idea, you wanted to do a website that rented movies through the mail, it was really hard. I mean, now, if you wanted to do a e-commerce website, two minutes, you do Shopify or you do a Squarespace and you’re up in 10 minutes. We had to write our own. You wanna take payments, well, now you just hook up to Stripe, or Square, and PayPal. And then we had to write our own payment portals to the bank and negotiate those arrangements.

Same thing if you want the server, the web pages, you just get Amazon Web Services in 10 minutes. We had to put our own servers into a closet and wire them up. In other words, it took a long time to get this idea in a place we could actually try it. And so what was I doing after having that check? The nuts and bolts of getting a business going.

You know, I rented a small office, I hired about a dozen people, we began writing the code for the website, we designed what the website would look like. We had to source every single DVD available at the time, which was not easy. We had to figure out where customers were gonna come from.

So, I spent ridiculous amounts of time in the wilds of New Jersey office parks trying to convince these big consumer electronics companies, you know, the Toshibas and the Sonys and the Panasonics, to let me put a coupon in their boxes of the DVD players they sold. We were working on what our PR strategy was gonna be at the launch. I mean, fundamentally doing the things that now you could do in a weekend but that took us then a good six months and almost a million dollars to do.

 

The Journey to Entrepreneurial Success

Jessica: So, I have a bootstrap company, we’re up 20 million in revenue, 10 years in, and profitability has always been really crucial. You know, tons of my friends here in Austin, entrepreneurs say VC-funded and profitability is not necessarily the fundamental thing they’re after at the beginning. Can you walk us through your path of what was success for you and when did you begin to experience that success?

Marc: I’m a little different. I’m motivated by something a little bit differently. Because for me, these have never been… the entrepreneurship has never been about the money. It’s never been about “This is gonna be huge. I’m gonna a fake famous entrepreneur.” For me, it was always solving problems or trying to do something that people haven’t done before. And the real challenge for me that I was trying to prove was, wow, is there a way to actually do DVD rental by mail, especially in the face of the fact that there is, you know, 9000 Blockbuster stores out there competing with you. So it’s true, I wasn’t immediately focused on profitability, but I knew that what I had to eventually figure out is some way of offering a service that I could charge more for than it actually cost me to do, and that was the challenge.

“The entrepreneurship has never been about the money. For me, it was always solving problems or trying to do something that people haven’t done before.” Marc Rudolph

But because I had no idea yet what this service would look like, what customers would do, how would they rent? Would they get one at a time? Would they do punch cards? Would be rent three at a time? I just had no idea, that at the beginning, I was just trying to figure out if I could stumble my way into this repeatable, scalable business model. And the aspirations were pretty modest to me when I gathered the whole team together early on, you know, and you set our big, hairy goal. I said, "It will be amazing if this company could be the revenue of a single Blockbuster store within the first 12 months."

Jessica: Wow. That’s perspective.

Marc: And that was about less than a million dollars. And so that’s what I was aiming for. And it turns out, in fact, that profitability was a long way away. And it turns out, fortunately, that that little internet thing that we were just starting to play with, that I had recognized could be so powerful for selling things in the internet, well, not long after we got into business, a lot of people got excited about that and it set off the gold rush, the era of irrational exuberance.

And pretty soon, you’re right, there was this feeling of “You’re crazy if you’re focused on profitability now. This is a land grab. You want as many customers as you can. We’ll figure out how to monetize it later.” It was a very unhealthy thing.

And, you know, listeners can jump around in time without getting too confused but luckily for us, you know, we got caught up in that too. And for a while, we were going down this very dangerous path of trying to become, the word was a portal, which was the place on the internet that everyone comes to for a certain thing. We were gonna be the movie portal because that was the buzzword back then. And we even were registered to go public as a movie portal. And then thank goodness, the crash happened and we all of a sudden had to get back to the realization. It’s almost like someone throws a bucket of cold water on you and goes, "Wake up. You have gotta do something which actually has some visible means of economic support here." I mean, if that hadn’t happened, if we hadn’t been forced to figure out a business model that actually made money, we would have gotten trounced after we had gone public.

Jessica: So walk us through how you navigated that, then?

Marc: Well, you know, I use the analogy of someone throwing a cold bucket of water on you. It’s not quite as dramatic as that because it’s more like, the realistic analogy is someone puts their fingers in and spray some on your face. You go, "What? What are you doing?" Then he gets a scoop of it and throws it on you. And then he pours the little bucket on but that may take a month or two. And it was that little thing. You all of a sudden begin to see companies going out of business but your bankers are going, "No, no, you’re fine. We’re still very confident. Our analysts say this is just a blip." And then more and more companies are going out of business and they’re going, "Oh, no, they’re different than you." So in other words, it’s little by little and finally, it dawns on you, no…

Jessica: We’re not different.

Marc: …you’re in deep trouble here too. And it’s a tremendously scary thing. But for us, it was, in some ways, worse because right around the same time, we had also finally discovered the business model that would work. And not to make it too complicated of a story but it was a subscription business and subscription businesses are very tricky. They have a tremendously wonderful thing about them, which is that once you have a customer, well, they keep paying you every month for years. And so you make your revenue back over a long, long time. The terrible thing about them is you have to pay all the acquisition cost, the cost it takes you to find that person to get them on, to give them that first month of service maybe to show them how wonderful your company is. You have to do that upfront.

So all your cost happens on day one and all the revenue that pays off that cost may trickle in over the next 12, 18, 24 months. And after 18 months in business, we had finally stumbled on what the model was that would work that would allow us to do DVD rental by mail, and it was subscription and it worked incredibly well that customers were flooding in. But unfortunately, when you have a subscription business and customers are flooding in, money is flooding out. And again, that’s not a problem when you’re in the midst of irrational exuberance and you can pretty much go out in the highway and stick up a green flag and a big truck full of money pulls in your driveway and just dumps it into the backyard and you get your wheelbarrows and bring the money in the house.

But then all of a sudden, when this all of a sudden you realize, “No, no, no, this is done, that bubble has burst, there is no more money coming,” it’s this triple tragedy, because you go, "Oh my God, we spent a year and a half, we tested 500 different things. We finally have found it. It is working unbelievably well but we’re going bankrupt being successful because…"

Jessica: Cash is king.

Marc: Cash is king. And so that was the wakeup call. That was the moment where we said, "We’re done." And in this case, we made the very, very difficult entrepreneurial call that it was perhaps time and, you’re an entrepreneur, you’ve heard this before, it was time to pursue strategic alternatives, which is code for “We gotta sell this thing and fast.”

 

The Flight That Inspired Innovation

Jessica: How many years in are you at this point?

Marc: Two and a half.

Jessica: Okay, okay. So not long.

Marc: No. It took us 18 months of scrambling to finally come up with the subscription business model, a year of it ramping up to tremendous excitement and then almost summer of 2000, we launched in 1998, summer of 2000, the crash happens and we are in deep, deep trouble and decide, "We’ve gotta sell." And our obvious strategic alternative was our old pal, Blockbuster. And they’re the natural people to sell to, partly because they’re so big, partly because they should get it, but partly because we had all realized that a blended model, in other words, a company which was doing rental with stores and online was unbeatable. And so, we were simultaneously scared that they would do it on their own. But the problem was even though we were excited by the number of subscribers coming in, we were still tiny compared to Blockbuster.

I think we were gonna do $5 million in revenue that year but Blockbuster was doing $6 billion. You know, I mentioned they had 9,000 stores, they had 60,000 employees. You know, we were this gnat, we were nothing, and even painfully, could not get them to take a meeting. They wouldn’t even return the calls. And it’s a famous story in Netflix lore that it so happened, they did finally call us, and as luck would have it, they called us, we were at a corporate retreat. We were at a ranch in the foothills outside of Santa Barbara, California. A dude ranch called the Alisal Ranch. And it’s pretty rustic and you kind of can imagine, you know, Silicon Valley is pretty casual to begin with. So of course, on the retreat, you know, we’re working at it and all I had with me was like flip flops and shorts and t-shirts. That was my wardrobe.

“We could not get them to take a meeting. They wouldn’t even return the calls. And it’s a famous story in Netflix lore that it so happened, Blockbuster did finally call us.” Marc Rudolph

And that, of course, is when Blockbuster calls us and says, "We’ll see you but tomorrow in Dallas." And we look at the flight schedules and there’s no possible way we can get from this little ranch out to Dallas in time for the meeting. And so decided the only prudent thing to do being $50 million in the hole and about to go out of business is to charter a corporate jet…

Jessica: Oh my gosh.

Marc: …yeah, to fly to Dallas. And this, Jessica, I’ll share with you the little Netflix trivia, little-known Netflix trivia here. That private jet that we charted was owned by Vanna White, which you’ll have to explain to your children who Vanna White was…

Jessica: Yes, I will.

Marc: …along with the video discussion. These are things every child should know though.

Jessica: That’s true. It’s true.

Marc: Anyway, we pile on the plane, we fly to Dallas, we end up in the 27-story glass and steel tower in this cavernous conference room with a huge endangered hardwood conference table, the whole thing. But you gotta picture that I’m there in my shorts and flip flops and a t-shirt and Reed is wearing a Hawaiian shirt. So he’s got buttons on so he’s like a couple of steps ahead. But anyway, suddenly the Blockbuster guys come in and they’re in their fancy suits and expensive shoes and all those things. We pitch that we’d combine the companies and it was going great. I go, "We’re crushing this." And then they asked, of course, the question we’d anticipated, which is, how much.

And as I alluded to a moment ago, we were about $50 million in money raised at that point, and spent, of course. And so, we said “It would be a really nice, elegant, neat way to wrap this up if we could sell the company and return all our money to our investors and be out.” So, Reed leaned in and said, you know, "$50 million." And they basically laughed at us at the hubris that we would think in the midst of the dot-com bubble bursting…

Jessica: Burst.

Marc: …months away from being out of business that we could ask for that much money. That was not even this cold water thrown on you, that was something different. That was horrendously disorienting and disrupting and depressing because on the flight over, I was excited. I went, "This is incredible. This is so self-evidently right and we’ve solved our problems or at least, I’ve taken our problems and put them on to somebody else." And now on the flight back, I’m just sitting there quietly going, "Not only are they not gonna save us, they’re gonna compete with us."

Jessica: We’ve shown them our cards and now, we’re going down.

Marc: Yeah. We’re in deep trouble. And we had spent enough time trying to figure out how to get out of this hole that we knew there was no easy way. There was no secrets. There was nothing we’d overlooked. You know, and the advice my dad used to always give me sometimes when I would come to him with my insurmountable problems as a kid, he’d go, "You know, listen, Marc, sometimes, the only way out is through. You gotta turn and face these things." And it was a very, very focusing, very sobering moment for all of us that we would have to get out of this on our own steam.

 

The Rest is History

Jessica: So, what did you do? You just like…

Marc: We went to Disneyland. No. That’s how all those stories are supposed to end. No. We basically said, "We have a little bit of money left, we’re not gonna be able to raise anymore, we have to transform the company. We’re gonna have to get to profitability under our own steam," which meant all those ideas about being a portal, nope. All the people we’d hired to sell advertising, gone.

Jessica: Gone.

Marc: Forty percent of the company, gone.

Jessica: Gone.

Marc: Really buckling down, focused, disciplined. And it was, I imagine, I’m sure you, Jessica, at some point in your business career, you’ve had to fire people. And in this case, you’re bringing people in to let go that were there from day one, that left their other great jobs and more benefits and higher salaries to come and help you make this dream come true and worked tirelessly to do it. And now, you have to sit them down and say, "You’re not the right person to bring us on this next part of our journey." And it’s the most emotionally wrenching thing you can do as an entrepreneur. And at the same time, there were some really positive things that came out of it.

We had this very, very special culture in those first year or two that most startups share and it had begun to slip away as we got bigger and got less focused. And there was this interesting revelation when all of a sudden, we all began coming to work again with 40% fewer people but no less really amount of work to do, which is, it forced us back into that mode of there’s no time for all these command and control things, there’s no time for the BS, there’s no time for expense reports and approvals. We just gotta go back to acting like a startup again. And more importantly, realized how fun that was. And there was this vow, we’re never gonna let ourselves become complacent that way again.

Jessica: You are such a good storyteller. I wasn’t planning on talking about Netflix for this long but this is just, I mean, we could go on and on. And you stayed with…

Marc: It’s almost as if you could write a book about it or something, Jessica.

Jessica: It’s true. It’s true.

Marc: Somebody should really write about those early years of Netflix and tell these stories.

Jessica: That’s right. That’s right, which you guys do need to go check out Marc’s book, "That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea." I’m hooked. I’m hooked.

But you stayed on as the Netflix Board of Directors until retiring from the company in 2003. I guess I’m curious, well, I could just ask so many questions, like I’m curious, what are the next key inflection points? Because, I mean, this is just such a rapidly changing industry. But I’m curious, what led you to that finally retiring in 2003? Because I’m surprised you stuck with it for that long.

Marc: So first of all, I’ve gotta tell you, I’m the luckiest guy in the world, I mean, for so many reasons. But one thing that I’m so lucky and so happy about is that really pretty early in my life, I figured out what I think are two of the most important things a person can figure out about themselves. And I figured out, one, what I’m good at. I figured out, number two, what I like doing. And the even luckier part is both of those turned out to be the same thing, which is startups, which is early-stage companies. I love that problem-solving. I love the challenge of doing something that hasn’t been done before. I love coming in to work and getting to sit around the table with really smart people solving these really interesting puzzles.

“Pretty early in my life, I figured out what I think are two of the most important things a person can figure out about themselves. I figured out what I’m good at, and I figured out what I like doing. The even luckier part is both of those turned out to be the same thing, which is startups” Marc Rudolph
And, okay, immodesty warning here, I’m actually pretty good at that. I just have some of these skills that lend themselves to those types of problems. And I’ve been lucky most of my life to get to do that. And Netflix was obviously incredibly exciting and challenging and I was solving amazing puzzles but partly because we were pretty good at it, Netflix became successful.

We did finally have the IPO, the initial public offering. All of a sudden, we had the cash we needed. We were able to hire these amazingly talented senior leaders who were way better than I were in these specific disciplines. And it got to this point, again, six-plus years into the company, that I still loved the company. I mean, it was my baby and I loved it the way you love a child.

But I also began to realize that it wasn’t really feeling like a startup anymore, that I wasn’t particularly loving what I was doing every day, and perhaps even more telling, I wasn’t very good at it. I’m not very good at big company problems. And so, you get to this point, you go, if you’re successful, that really means you get to work on the things that you wanna work on.

And I realized that was not a company that was as big as Netflix for those types of problems. And then I could have the flexibility to go back to working on early-stage stuff. And so this was not like a sudden “I’m out of here, slam the door,” this was realizing this over a period of time, having long talks about it with Reed, and then figuring out a way to let me leave the company without impacting my baby.

And I did. It took about a year, gradually transitioning my responsibilities to other people, moving myself sequentially into roles where of less visibility. And so eventually, I was able to leave. And since then, you know, I’d ended up somewhat involuntarily, got pulled into starting another company, and more importantly, I’ve had a chance now to work with early-stage entrepreneurs all over the world. I’ve had a chance to mentor some amazing companies. I’m getting a chance to do the stuff that I love doing and that I think I’m pretty good at.

 

The Art of Storytelling

Jessica: I love this. I love this so much, and you have a love for the outdoors.

Marc: Oh, yeah. My life is a three-legged stool, Jessica, if I could phrase it that way. Again, it’s one of the other things. I’ll say this, that the entrepreneurial stuff, for the most part, came… I’m not bragging about this. It comes naturally to me. It means these are not things that I necessarily went, "Oh, I am not like that. I’m gonna teach myself to be like that." So, the way I think happens to work for solving business problems. The thing I have to think about and work about and challenge myself on is balance. And that’s also something that I learned when I was in my late 20s or so, which was that I couldn’t work all the time, even though I loved it and it was compelling because then, I wasn’t a full person and that there was other parts of my life that were important.

And one, of course, is my wife and then my family which came slightly thereafter. But I realized, that’s not something that I can do after work is over, I can’t come home from work at 10:00 at night and expect to have a relationship with my wife. I had to make that as important as the work.

But there was this third realization, which is what you just brought up, which is that what really makes me whole is the outdoors. I’m really into, I’m not even sure what the category is, but things like mountain biking or back country skiing or surfing or kayaking. I mean, basically, if it takes place outdoors and could result in a trip to the hospital, I’m in. That’s what I enjoy.

And in some ways, it’s wonderful to have a passion like that that I know just fulfills me so much but the downside is that when your passion is doing those sort of things, which sometimes require three bush plane flights in a row out to some place up in northern Alaska, and then you’re gonna spend two weeks canoeing some river in the Arctic National Wildlife Refuge, that’s not something you squeeze in between your 10:00 phone call and your 1:00 meeting. You’ve gotta plan for that and you’ve gotta work it in around those other two pillars in your life, around the family and around your other family, which is your startup.

But yes, that’s a long way of saying outdoors is a big part of what makes me tick and what fulfills me and what grounds me and what allows me to stop thinking about what’s gonna come and what just happened but live in the moment and appreciate things. It’s a wonderful, wonderful, wonderful thing.

Jessica: Okay. Have you seen "The Social Dilemma" that was produced by Netflix?

Marc: Yes. I absolutely have. Boy, that was a wakeup call, huh?

Jessica: Okay. So this is what I’m curious about because, you know, they interview all these ex-Silicon Valley tech guys and then there’s this underlying tone of regret in some of these interviews with these former founders and creators and they feel regretful almost at what they created and what that has become. So, I’m curious because you are such an outdoor enthusiast and yet now, Netflix can be one of these avenues that, you know, we just get… I mean, we’ve all done the Netflix binge. So I’m just curious, have you, like, what do you experience now that you have… you never could have predicted streaming and just even where all of these services have gone, is there something you would have done differently or how do you kind of hold that tension of, I think at the end of the day, you tell someone to go outdoors other than like, you know, binge on their six Netflix series. So how do you hold that tension?

Marc: There certainly is this tremendous irony that, you’re right, for someone who is as focused on the outdoors as I am, that dedicates almost all of their philanthropic effort to outdoors preservation is best known for inventing a way for people to spend more time in front of a screen.

Jessica: It is ironic.

Marc: And it’s funny, actually, just in about an hour and a half, I’m gonna be doing some… helping a friend of mine whose path, he spent most of his post-tech career saving lives. You know, he’s doing medical work. It’s unbelievable. And I always… I feel it’s so funny sometimes. But listen, we can’t all be Jonas Salk. We all have to do the best work we can. And in some ways, this last 15 months has been tremendously gratifying, I guess, to see how Netflix has been embraced and how many people, I mean, countless people who have told me that Netflix helped get them through being locked in their house, you know, confined in their apartment.

And that if it was not for having something that was able to take them away, to take them different places, to take them to experience different people and different cultures, it would have been… they would have lost their mind. And so yes, I feel a bit better about that. I’m certainly proud of what Netflix has accomplished. Storytelling is hardwired into us. That’s how we have communicated with each other since we all sat around the fires as Neanderthals. And so, to say that you’ve created a different and better way to share stories with people, I don’t feel any shame in that.

“I’m certainly proud of what Netflix has accomplished. Storytelling is hardwired into us. And so, to say that you’ve created a different and better way to share stories with people, I don’t feel any shame in that.” Marc Rudolph

Jessica: And I love how you can be both, you know, we talk a lot on this podcast about paradox and about, you know, you can be an outdoor enthusiast and you can be an incredible storyteller via creating one of the most-watched media platforms today. I also wanted to ask you about just this pandemic, this series that we’re in right now, we’re calling it "Decide, Don’t Slide." And you have lived such an intentional life. I mean, it is rare to meet someone as successful as you, the incredible father, has been outdoor enthusiast, what would you share with our listeners, this idea about decide now, so that you don’t slide maybe back into some of those habits that you’ve gotten out of? Or, you know, I think a lot of people have woken up to their lives in new ways.

 

The Secret to Living Intentionally

Jessica: You know, even as hard as the last 15 months have been, there has been these new realizations that we’ve uncovered. So just how have you been able to… it seems like you prioritize the right things in life and, you know, you live a very values-oriented life. So what can you share with our listeners about how they can do that?

Marc: Well, first of all, I love the "Decide, Not Slide." I think that’s awesome. But, you know, I mentioned earlier to the fact that I had to work on balance. I continually have to work on balance. Listen, I’m like anybody else. I get caught up in things. I mean, I’ll open up TikTok and like then an hour and a half later, I go, "What the hell just happened?" So, it’s not like I have some superpowers. I’ve just decided that balance is gonna be the main objective of my life here and I have to work at it. And I do it in small ways. You know, at the end of every week, I look back at how I spent my week and I look forward at my week and I consciously ask myself, "What is the ratio between want to do and need to do?"

And if I start seeing that it’s sliding too much into the need to do, I go, "I need to make an adjustment here." I look at it every month. I look at it every quarter and I take a big look at it every year. But there are points in life where you get a chance to do major resets and I’ve learned to recognize those and take advantage of them, and one of them certainly has been COVID. Another one happened to me, interestingly enough not long after I left Netflix. And as happens quite naturally, all kinds of wonderful opportunities come along. People were saying, "Would you be an advisor? Would you join this board? Would you do some of this nonprofit work?" And at first, your filter is, “Is this a good thing, and if it is, you say yes to it.”

“There are points in life where you get a chance to do major resets and I’ve learned to recognize those and take advantage of them, and one of them certainly has been COVID.” Marc Rudolph

And pretty soon, you go, "Oh, my gosh, my day is packed with things and three-quarters of them, I don’t really care about." And then I had a lucky break in that my family and I decided that we would take a very extended sabbatical. We would move to Europe. We’d take the kids out of school here in the United States and we put them into school. They were three kids who were, you know, I guess at early teens and young adults.

Jessica: Wow. That’s a big time in their lives to decide to do something like that.

Marc: Yeah. And we moved to Rome, to Italy, and lived there as a family. And besides, I mean, this is, if you’re in a situation you can possibly ever do that. I highly encourage it. It was fantastic on every level. But the level that we’re talking about now is it gave me this graceful way to detach myself from every single thing I’d committed to. And all of a sudden, I was, I’m gonna use the word free, but I was completely unencumbered. I could do whatever I wanted. And I thought to myself, “When I go back to the United States, I don’t want to let happen what happened before." I wanna be thoughtful about, “What do I really want? How do I really wanna spend my time and how can I design a life that lets me do that?”

So, it was an amazing thing. And so all of a sudden, let’s fast-forward 15 or so years, and all of a sudden, a year ago, last March, April, all of a sudden in the space of two weeks, every single one of my travel business appointments was canceled. All of a sudden, my calendar looks like it did when I was eight, nothing on it. And it was this gift of all of a sudden going, "Wow, how had I let my self get so caught up in these commitments that I was doing." My need to do was greatly exceeding my want to do. And then even better things happened is all three of my adult children moved home. And it was funny, my wife used to say, she goes, "Oh my God, every single dinner is like Thanksgiving."

I’m not sure she meant that in a positive way but I took it as this incredibly positive thing. I’m going, "This is fantastic. I’m having a chance to really connect with my family and spend all this quality time and get to know them again as adults," which and got to know, you know, my kids’ partners as adults, just really special. And so absolutely, absolutely, I said to myself, "I am not going to forget what I learned from this. I’m not gonna let go of the things that I’ve gotten from this. I’m not gonna let COVID be a purely negative, hurtful thing."

And although I recognize how lucky I am that I actually have so many choices but all I can speak to is from my individual circumstance here is that that reset for me was a very, very positive thing. And I’ve absolutely have said to myself, "I need to make sure I hold on to what I learned from getting a chance to restart again."

 

The Importance of Paying it Forward

Jessica: Well, I wanna close with your new podcast. I mean, in a very humble way, basically have described that, you know, you can do whatever you want in life. You’ve got enough money, you’ve got the resources, you’ve got choices, and I love that you started a new podcast to serve new entrepreneurs, That Will Never Work, best name ever for a podcast, That Will Never Work. So tell me about where that fits into your life plan. Why did you decide to launch that podcast?

Marc: You know, in some ways, it’s new, but in some ways, it’s something I’ve been doing for a long, long time, I mean, even before Netflix but especially since I left Netflix. People call all the time, entrepreneurs with questions, with problems. They wanna understand go-to-market strategy or tech stuff or fundraising or more frequently, they call about personal issues, “I’ve been struggling with my cofounder, how do I make time,” “God, I never get home to see my husband because I’m working so hard.” And I’ve always taken those calls. You know, I’ll spend hours on the phone with people. I’ll go in and sit with them in their office for half a day trying to help them get on the path. I do a lot of work with university age and younger entrepreneurs trying to give them a push.

I’ve kind of realized, in some ways, this is my purpose is to kind of help people take that dream or that idea and make that idea real. That all these tips and tricks that I’ve learned for 40 years as an entrepreneur can be used for all kinds of things. And all of us have ideas, there’s just a big difference between getting it out of your head and making it real.

So, I’ve been doing that for 40 years, for 20 years, rather. What’s different is about a year ago, I go, "I’m getting a lot of repeat questions. I’m gonna start taping these calls," with people’s permission, of course. And I’d just record the call. And then sometimes, people would call me up with a question, I go, "Okay, I’ll talk to you but listen, before you do, I’m gonna send you a tape of this call I did with someone with a very similar issue to you, and listen to it."

And this really interesting thing happened. I mean, of course, they go, "Wow, that was helpful hearing that problem dissected." But two other really cool things happened. One is, they said, "This is actually kind of entertaining. Like, I found myself drawn in. I was identifying with this person and the problem they had and then I was kind of curious what you were gonna say." But the other amazing thing is they were saying, you know, "I didn’t know anyone else was having the same problem that I was having." And because that is hard, entrepreneurship is a lonely profession. No one else is solving the problem you’re solving and there aren’t a lot of people you can go and talk to about it. And so, being able to show people there were people just like them with similar problems was a great way of kind of letting someone know they weren’t alone.

“Being able to show people there were people just like them with similar problems was a great way of kind of letting someone know they weren’t alone.” Marc Rudolph

And so, from there, it wasn’t a long step to saying, "I think I might be able to reach even more people by doing a podcast of this." And in classic fashion – and listen, I could have done a how I built this version, you know, I have tons and tons of very successful celebrity entrepreneurs that I could have interviewed but that would have been in the need-to-do column. The want-to-do column is I wanna keep working with early-stage people, with people who are not known but are solving some challenging, interesting problems and it’s so fun. I mean, some of these people you talk to are from crazy backgrounds.

There’s one woman, she was a pickup coach. She worked for a company that helped train men to pick up women and finally got disgusted with this but realized that the skills that she’d learned how to teach could be used to teach anyone to establish a more genuine connection with somebody. And what an incredibly interesting company to try and help her get off the ground.

Another guy is starting a 60,000 square foot indoor adventure park in Texas, you know, with rappelling and zip lines that serves alcohol, what could go wrong with that, and he wanted to talk not about go-to-market strategy or fundraising, he wanted to talk about this business is gonna be open 18 hours a day, 7 days a week and I’ve got a family with 3 children under 10, how do I manage that?

And it’s been wonderful. And so that was the genesis for wanting to do a podcast and that is the That Will Never Work podcast. And, you know, I hope people listen because I think it is a great way for people to really get past the platitudes, the, you know, you don’t get anywhere unless you start. Well, that’s certainly true but that doesn’t really help you go, "My idea seems too complicated to start without fundraising, without hiring a technical cofounder, without quitting my job," and because of that, no one does it.

And so, I want people to listen in as I walk through a real person and show them how to break down that so they can start without quitting their job, without having a computer science degree, without raising money.

Jessica: I think this conversation with Marc showed that paradox of “and” that we talk a lot about around here on the Going Scared podcast. He holds that tension of being a lover of spending his free time outdoors while being responsible for revolutionizing how people spend their own free time. And oh my goodness, I think we spent a lot of our time last year on Netflix. And it really is amazing how just this one problem that he wanted to solve eventually has led to a media company that has changed the world.

I also really appreciated his daily, monthly, and yearly assessments. I mean, every week, to look back on your week and reflect, “What went well? What could I have done better?” That’s really powerful. I feel like the more people that I interview on this podcast, and maybe you have had this takeaway as well, people that are reflective, I find that as such a quality in a leader. Someone who is not just jumping to the next thing, but who is actually pausing and then prioritizing based on what went well, what worked, what didn’t work in the past. In fact, there’s something that we do at Noonday regularly called, “Start. Stop. Keep.” and my kids are gone!
I’m sorry. I’m sorry if I’m bragging about that. But after the past 15 months, it’s just nice to have my house to myself with my husband. And so, we are actually doing this “Start. Stop. Keep” together. And ever since having this conversation with Marc, I’ve been more intentional about reflecting on my week. So, I think that is a really good way to be a decider instead of a slider.

You can go visit and learn more about Marc at marcrandolph.com.   

Our wonderful music for today’s show is by my good friend Ellie Holcomb. Going Scared is produced by Eddie Kaufholz. And I’m Jessica Honegger. Until next time, let’s take each other by the hand and keep going scared.