There are very few people who have not heard of Netflix. The company has grown swiftly in just a few years that it no longer needs an introduction. However, many people lack background knowledge of the failures and successes of the company. Before being a streaming giant, it was a DVD rental company that was on the edge of failing. So, what happened? How did they turn their situation around?  Here is the story of Netflix, to understand the highs and lows in their career. 

 

Marc Bernays, the co-founder and the first CEO of Netflix, is an American entrepreneur with the mindset of business. He funded various corporations during his career. He was born in New York and was connected well to the legislative framework because of his father. He spent his summers working with the National Leadership School. After completion, he pursued Geology from Hamilton College and soon took a job at a Music Company. There, Randolph operated in the mail-order operation and discovered the basics of the marketing means. Later he obtained an interest in user data that led to his idea and inspiration for the origin of Netflix. In 1980, companies like MacUser Magazine and MicroWarehouse founded corporations that managed all the mail orders a few years later. He joined Borland International in 1989 as a part of their marketing team. However, In 1996 Pure Atria was acquired by Integra, which led to the meetings of Randolph and Reed Hastings. 

Wilmot Reed was born in Boston and did his education at the Buckingham School in Cambridge. After some years, he joined Marine and spent his summer working at Marine, however, he never completed his training as he chose to work in the business sector. In 1990 he graduated from Stanford University with a master degree in computer science and joined a technology company. He left the company in a year and designed the first software to solve the initial problems presented previously. Consequently, the company merged with a software company, in 1997,  that was managed by his old friend Randolph. Later in the year, that company was procured by a software giant for a whopping $900 million.

 

Moreover, Netflix was drafted in 1997. The idea was developed on a long drive of 80 minutes. For the next half of the year, Randolph kept pitching the idea to Hastings, until it was accepted and commenced with a movie rental company operated through mail service. The first thing they did was buy a CD and sent it to each other to examine the timing of the mail service. When they received the product on time and without any damage, they recognised that this idea could transform into a business. The next steps were to find an investor, to fund their idea and to a working business model. They faced thousands of refusals during this process. Most investors laughed at their idea, but they didn’t give up and strived hard for the making of the company. In 2001, Netflix had over 300,000 subscribers but incurred some losses. Due to their growth, Blockbuster offered them the buying offer for $50 million. But they refused the offer and worked towards the economic crisis that hit the market in the same year. 

 

The company continued public in 2002 and sold 5 million equity in the market. They earned their first gain of US$6 million in the next year, and had by then, over 30,000 movies were stocked and mailed alongside over 1 million DVDs each day. Â