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Interview with Marc Randolph

Your oldest son has become an entrepreneur, forming his first company within a few months of graduating. Were your parents entrepreneurs, or was there a different trigger for you to create businesses?

My son chose to work as an entrepreneur when he finished school and I’ve always wondered just how much parental influence had to do with it, just as I wonder how much parental influence influenced my own choice of careers. My father certainly was about as far from entrepreneurial as possible (he was an investment banker), but at the same time he was a lifelong supporter of all the apparently crazy risks I was taking early in my career. Luckily, there was never pressure on me to get a ‘real’ job. Especially since I don’t think I could have held one down.

I wouldn’t say there is any kind of trigger for being entrepreneurial – it’s really more like a compulsion. Even when I was young, I always wanted to start things – clubs, magazines, little businesses. It’s nothing you can control. Once you have an idea, you can’t help but want to do something about it; to make it real. That feeling of always exploring – of always starting down a path with no idea where it’s going is tremendously addictive.

Where do you get ideas from for new business ventures and can you tell early on if one idea will be more successful than another?

Most of my ideas come from having trained myself to see the world as imperfect, and once you start seeing all the things that annoy you, that don’t work as well as they should; it’s just a small step to coming up with dozens of ideas to make things better. You can come up with hundreds of ideas this way – and that’s a good thing, because there is really no way at all to know in advance if it’s a good idea or a bad idea. You have to try them. Most ideas are bad ones – and that’s why we spend so much time figuring out how to test ideas quickly, cheaply and simply. Since you have no idea in advance what’s going to work, you have to try lots of things to ultimately discover the thing that can become a successful business.

Do you believe encouraging creativity and innovation throughout a company is important whatever the size or the industry of that company?

Creativity and innovation are essential, regardless of the size of your business or the type of work you do. The world is changing so quickly now, that if you aren’t constantly trying to disrupt yourself; someone else is going to disrupt you. On the one hand, the fact that a small start-up like Netflix could bring down a huge multi-billion dollar company like Blockbuster can be tremendously inspiring, in that there is no limit to what a small start-up can achieve.

But that is going to feel completely differently if you are a huge multi-billion dollar company worrying about who is about to do it to you. The internet has allowed people all over the world to innovate rapidly and bring new solutions to old problems at absolutely remarkable speed. Companies that can’t adapt to this rate of innovation are doomed.

You are most famous as the co-founder of Netflix. Do you feel that all your business experiences in previous years helped you make the critical decisions which led to Netflix being the phenomenal leader it has become?

I’ve been an entrepreneur for nearly 4 decades, so you could say that my overnight success actually took 30 years. Netflix was my sixth start-up, and each of those early companies taught me something new, and all of those skills were brought to bear when we started Netflix. I never stopped learning at Netflix; gaining skills that I’m now trying to share with the early stage entrepreneurs that I mentor. However, there are some things that I learned early in my career that have been there throughout; a strong belief in analytics, testing, and data-driven decision making; an obsessive focus on getting just a few things right; a willingness to quickly leave behind an idea that is not working, no matter how in love with it you might be; and a belief that the most important thing there is in starting a company is to make sure you have a balance in your life. Work is an important thing – but it’s not the only thing.

What do you think are the most important attributes an entrepreneur should possess if they are going to achieve success?

Being a good entrepreneur requires bringing together many talents, but there are a few skills that are essential. You have to have a tremendous tolerance for risk. Starting a new business is sailing into uncharted waters. It’s terribly scary, but equally exciting. An entrepreneur needs to be persistent; every start-up faces dozens of setbacks and you need to have the strength to get back up and charge back in every time you’re knocked down. An entrepreneur needs to be confident; when your friends and colleagues tell you “that will never work’, you have to have the strength of vision to always believe that it will, and then have the strength to make those seemingly impossible things actually happen; and finally, an entrepreneur needs to have an unerring intuition as to which two or three things – of the hundreds of things that are broken in a young business – actually are the few things that will ultimately make a difference if you get them right. And then have the strength to focus on them, despite so many other distractions calling out for attention.

While it’s true that the majority of new businesses fail – some of them do succeed. Sometimes spectacularly. There’s no reason it can’t be you.