Home Featured Story Reed Hastings-Founder, President, CEO and Chairman of the Board of Netflix, Inc.
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Reed Hastings-Founder, President, CEO and Chairman of the Board of Netflix, Inc.

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Born Wilmot Reed Hastings, Jr. in 1961, Reed Hastings earned master's degrees in computer science and in education from Stanford University.

His career has been as varied as the movies offered by Netflix. He served in the Peace Corps in Swaziland from 1983 to 1986; worked as a software developer from 1988 to 1990; founded Pure Atria Software in 1990, and sold it to Rational Software in 1997; was director of TechNet, a political lobbying group; and was president of the California State Board of Education from 2001 to 2005. He founded Netflix, Inc. in 1998.

Hastings grew up in Washington, D.C., and the Boston area. His father was an attorney for the U.S. Department of Health, Education, and Welfare. After graduating from a private school in Cambridge, Massachusetts, Hastings went on to Bowdoin College in Maine, where he studied mathematics. He earned his degree in 1983 and immediately joined the Peace Corps, a U.S.-administered organization that sends trained volunteers to struggling parts of the non-industrialized world. Hastings spent three years teaching math to students in Swaziland, and then returned to California to earn a graduate degree in computer science from Stanford University.

Hastings became a software developer, and in 1990 started his own company, Pure Atria Software. He sold the company several years later to a larger software firm for approximately $750 million. When USA Today did a feature story on the growing number of instant millionaires in the Silicon Valley area of northern California, one of the photographs that ran with it showed Hastings and his Porsche sports car with the caption, "Boom! You are rich!" Over the next few years, Hastings became active in educational philanthropy, working to increase the number of charter schools in the state and advocating stronger math and science curricula in all schools. During this period Hastings returned to school, earning a graduate degree in education from Stanford University.

Hastings came up with the idea for Netflix in 1997, when he had to pay $40 in late fees for a copy of Apollo 13. At the time, the bulky videocassette format was the standard still, but a smaller, cheaper digital movie format, the DVD, came onto the market. Over the next few years, affordable DVD players for the home flooded the consumer electronics market. Hastings thought that a company that sent out the lightweight DVDs to subscription customers by mail, and without a time limit to return them, might be a better alternative for consumers to the video store.

He and a co-founder, Marc Randolph, started Netflix in 1998, and began offering subscriptions a year later. Subscribers paid a $20 monthly fee, and in return, could have unlimited DVD rentals. Their selections were made from the company website, www.netflix.com, and a subscriber could take up to three movies at a time. Returning them was simple: a postage-paid envelope arrived with each rental, and every time one was returned, the subscriber's next choice was sent out.

Netflix struck deals with all the major Hollywood studios to provide newly released DVDs, and began amassing an inventory of DVDs which were stockpiled in their warehouse/distribution centers across the United States. In 2000, the company entered into an arrangement with electronics retailer Best Buy, which agreed to place Netflix stickers on boxes of new DVD players it sold; in return, a Netflix subscriber had the option to purchase a movie they had liked on the Netflix website via a "buy" button that took them directly to the Best Buy retail site.

Hastings was determined to grow his company carefully, and his prudence attracted the attention of Wall Street. In May of 2002, Netflix became a publicly traded company with an initial public offering. The company had 600,000 subscribers by then, but hit the one million mark less than a year later. There was a 50 percent increase in subscribers for 2004, to 1.5 million, and by September of 2005 there were 3.5 million Netflix devotees.

Today the DVD rentals are gone. For $7.99 a month, customers can instantly watch unlimited movies and TV episodes streaming over the Internet to their televisions via an Xbox 360, PS3, Wii or any other device that streams from Netflix. They can also watch instantly on their computers.

Editor Phil Robertson is an award-wining journalist and graphic designer. With a degree from the University of Florida’s School of Journalism, his career in journalism and publishing spans over 30 years, and includes positions as editor and publisher for several newspapers and magazines. During his career he has received a first-place award for investigative journalism from the Society of Newspaper Editors, and five ADDY awards for advertising design.

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