Reed Hastings

Reed Hastings came to Netflix as a technologist and repeat founder rather than as a Hollywood executive. After studying mathematics and computer science, he worked as a software engineer and founded Pure Software in 1991 to build tools for developers. Pure Software went public and later merged with Atria before being sold to Rational Software in 1997, giving Hastings direct experience with venture capital, public markets, scaling teams, and the difficulty of preserving culture through growth. That background shaped Netflix in two ways. First, Hastings saw the internet as a system for changing distribution economics, not merely a marketing channel. Second, he brought a software founder's willingness to cannibalize a working product before the market forced the issue. His later emphasis on freedom, responsibility, talent density, and direct feedback came partly from lessons learned while Pure Software became more bureaucratic than he wanted.

Netflix was founded in 1997 in Scotts Valley, California, by Reed Hastings and Marc Randolph. The best-known version of the story is that Hastings was charged a $40 late fee by Blockbuster for Apollo 13 and invented Netflix in response. The actual origin was more deliberate. Both men were experienced software entrepreneurs, and Hastings had just sold his company, Pure Atria, for $700 million. They were looking for a category they could change using the internet. They considered VHS tapes and found them too bulky to post cheaply, then turned to the newly introduced DVD. Randolph bought a music CD, put it in a greeting card envelope and mailed it to Hastings. It arrived unbroken, which told them discs could be sent by post. The more important decision came later: a flat monthly subscription with no late fees, supported by a system that recommended films to each customer.