Marc Randolph, first CEO and one of the co-founders of Netflix candidly shares in his autobiography That Will Never Work, how Jeff Bezos almost bought Netflix.
Here is an excerpt from it-
I realized, when he spoke, that Jeff[ Bezos] did not gesture with his hands unlike me. Instead, for emphasis, he used his head, lifting his chin for issues, suddenly putting it down for emphasis. He was curious to twist his head at an angle of 45 degrees. His personality still maintained a powerful dose of “gee-whiz” excitement at thirty-four, but all the childlike pleasure in the globe could not constantly mask the analytical and ambitious brain behind his blind eyes at work.
As I began to take Jeff to speed about Netflix, he peppered me with issues detailing the attempts we had made to get the site off the ground. How can I understand I’ve got every DVD? How can I predict the anticipated turns? What were the sales to rent ratio I expected to be? But it was evident to me that the tales about the launch day were what he was most enthusiastic about — especially that ringing bell tale.
“That’s great!”He exclaimed so excitedly that his hands were almost moving. “We had the same thing exactly! A bell whenever an order arrived in that rang. I had to prevent everyone from rushing to the computer screens to see if the customers knew
We both laughed at the beta names of our ventures. He laughed at Kibble and told me that Amazon was originally named Cadabra which he kept cause it can evoke the sense of the magic of online shopping.
Amazon was relatively small in 1998 but still, they had over 600 employees and were doing more than $150 million in revenue. But Jeff missed those simpler and exciting times.
On the other side, Reed was evidently bored. Forget “regret minimization framework” — Reed has never been someone who dwells on the past, so he had little interest in these tales of early fighting and frenetic launch days. His smooth stare had turned stony, and he jogged his leg up and down impatiently. He wanted, I knew, to direct the discussion to the subjects at hand: what Netflix was doing, how it might fit with what Amazon was doing, and how some sort of “agreement” might be a win-win situation for both sides.
“It’s not all that we need to go through,” he said, exasperated. “What do Netflix and Amazon have to do with this and how can we work together?”I was just completing my professional summary with Jeff and Joy and was about to brief them on Christina, Te and other important members of our team when Reed decided he’d have enough.
Everyone was stopping. It’s been quiet.
“Reed,” I said a few seconds later. “It’s clear that Amazon is considering jumping into the video using Netflix. Our individuals would be a enormous component of any purchase, so it’s absolutely fitting that they want to know who we are. “I was happy when Joy jumped in to assist. “Reed,” she suggested, “can you assist me better comprehend how you think about the economics of your unit?”That was precisely what Reed wanted to hear, and he started running Joy through the numbers with apparent relief that we were lastly on the subject.
After the conference was over an hour later and Bezos had returned to his office, Joy continued to wrap stuff up. “I’m very pleased with what you’ve done,” she began, “and I believe there’s plenty of potential for a powerful relationship to jump-start our video entry. But. . “Now let me have something to interject here. I’m not a guy of “but.” From that phrase, nothing good ever emerges. It was no exception this time.
“But,” ongoing Joy, “if we choose to go down this route, we will likely land in the low eight figures somewhere.” When someone uses the word “eight figures,” they refer to numbers. Eight numbers translate into tens of millions of dollars. If somebody uses “low eight figures,” that implies eight figures scarcely. Probably this implies something between $14 million and $16 million.
That would have been a nice result for me as I owned about 30% of the business at the moment. Thirty percent of $15 million is a fairly good return for twelve months of work— especially when your spouse suggests it’s time to take the children out of private college, sell the house, and move to Montana.
But that wasn’t enough for Reed. He owned the company’s other 70%, but he would also have invested $2 million in it. And he’s been fresh off the Pure Atria IPO. He’s been an “eight-figure man” already.
This is a very interesting story which Mark Randolph shared in his autobiography.
Taken from That Will Never Work by Mark Randolph.
