Tickets, Please

He sneaked into DVD rental through the door Blockbuster took its eye off--the internet.
Magazine Contributor
1 min read

This story appears in the August 2002 issue of Entrepreneur. Subscribe »

Vital Stats: Reed Hastings, 41, CEO and co-founder of Netflix.com

Company: Online DVD rental service

Sales: $76 million in 2001, with more than 600,000 subscribers and a DVD library of 11,500 titles

Better Late Than Never: "I got a whopping $40 late fee for Apollo 13. I started thinking, 'How come movie rentals don't work like a health club, where, whether you use it a lot or a little, you get the same charge?'"

Going Postal: "We recognized the mail is a very efficient network. It costs us 37 cents to mail the DVD. That's 100 times cheaper than sending it over the Internet."

Blockbuster Blowout? "Now and then we have our juvenile fantasies of beating Blockbuster, but whatever success we have will grow the total market. I'd be very surprised if it negatively impacts Blockbuster at all."

Prior Commitments: Currently the president of the State Board of Education in California and already wealthy from a previous venture, Hastings says this of Netflix's success: "[It] won't change my day-to-day lifestyle, but it will [help] me get more schools started and new programs funded."

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