Silicon Valley founders could learn a lot from the orderly, drama-free succession planning at Netflix Inc.
Co-founder Reed Hastings stepped down as co-chief executive Thursday, roughly 25 years after he and co-founder Marc Randolph hatched the idea that ultimately became Netflix NFLX in the dot-com era. They started out with DVD movie rentals through the mail, with Randolph serving as the first CEO before Hastings took over in 1999, well before Netflix’s 2002 initial public offering.
It wasn’t easy. There was the “Qwikster” debacle of 2011 and its fallout, which had customers and investors calling for Hastings’s head. Netflix created original content at great expense, despite Wall Street’s constant doubts about the amount of debt the effort required and Netflix’s ability to make it pay off. And doubters still remain, as the stock got pounded last year amid a lull in subscriber growth.Even as pressure built last year, however, Hastings maintained his succession planning.
Granted, some of the results of the company’s succession planning remain to be seen, with Peters having inherited a plate full of issues, as Netflix seeks to return to bigger growth rates, amid huge competition in the streaming business. Jamie Lumley, an analyst at Third Bridge also pointed out the macroeconomic factors in the background.
But even so, tech founders such as Marc Benioff of Salesforce.com Inc. CRM , whose last two co-CEOs in a span of two years did not work out, and Meta Platforms Inc. META co-founder Mark Zuckerberg, whose insistence on his vision as the controller of the Facebook parent has hurt the company, just to name a few, should watch the Netflix leadership show.
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