Ted Sarandos is the co-CEO of Netflix, the largest premium subscription streaming company on the planet, and currently has a market capitalization of over $500 billion.
But more than 20 years ago, before the dawn of video streaming, Sarandos first met with Lead Hastings and was a bit skeptical when he heard about the vision of Netflix’s co-founder’s home entertainment moving towards internet streaming.
“To be honest, it sounded nuts to me,” said Sarandos, who shared the earliest memories of Netflix and others in the latest episode of the “Aspire with Emma Grede” podcast.
In October 1999, Sarandos and Hastings first met when Sarandos, an executive at Video-Rental Chain West Coast Video, interviewed him for his work on Netflix, procuring DVDs for disc-by-disc service.
“Reid said all the entertainment comes to your home on the internet,” Sarandos said. “Now, at this point, there was no entertainment in the internet home. It was too late and too expensive.” After Sarandos pushed back the idea, Hastings replied, “No. In fact, if you think you still get your entertainment on cable, then you should not do this job.
“So he laid it out,” Sarandos continued. “I wasn’t sure I believed in him. I honestly thought this guy was someone who transforms the world on a certain level.”
Of course, Sarandos accepted job openings and started in 2000 as product vice president and content operations head. He caught Hastings’ eye after learning in a West Coast video that Sarandos had cut his revenue sharing agreement with Warner Bros. and Sony. “Reid read about it and he said, ‘I need that deal.’ ”
“By the way, when I first joined the company, we were buying movies on Walmart DVDs,” Salandus said. “People are going to buy best buys and stock, so when I came in, my goal was to (trade) the studio directly.”
After Netflix began streaming in 2007, Sarandos said: “One thing we didn’t have was a new movie. At the time, pay-TV deals were rocking movies for years. Basically, we couldn’t license a movie that played in a theatre like Netflix in 10 years.
Sarandos has led Netflix to its original content. This included the series House of Cards, a pickup from “Arrested Development” and “Orange Is the New Black.” He recalled how he won a $100 million contract with the producer of the US adaptation for “House of Cards.” Kevin Spacey and Robin Wright were obsessed with David Fincher on the director’s first television show. “There are a thousand reasons why I say no… What is one path to Jesus? I gave them two seasons of orders without a note. We promised them not to interfere in creatively,” recalled Sarandos. “It was big back then. Even going straight to the series would be extremely rare, let alone picking up two seasons.”
Sarandos said Netflix uses “data-based intuition” to make its greenlight decision. “We have to be very careful that we are not looking for data to check our intuition, but in reality we are just saying the opposite,” he said. “You know, it’s one of our core cultures on Netflix. This agriculture is challenging.”
When he became immersed in Hollywood, Salandus said he came to understand that this is truly a business of trust.
Netflix promoted Sarandos in 2020 and became CO-CEO alongside Hastings. Early on, Hastings told him, “I’m going to build a company that will come after me.” “He brought me along as co-CEO, which is unprecedented to the founder,” Sarandos said.
In 2023, Hasting resigned as co-CEO, and the company ordered then-Greg Peters, who was paired with Salandos, into the role. “I don’t think the CO-CEO model is for everyone,” Sarandos said. “But for our business, it works very well, and Greg and I have this relationship similar to what Lead and I had.
Recently, Sarandos told Hastings, who is chairman of Netflix, “always.”
On the podcast, Grede, founding partner and chief product officer of Kim Cardadian’s Skim, asked questions loaded to Sarandos.
Sarandos responded with a “selfish answer.” I think that’s a relief (entertainment industry). Many people are surrounded by the idea of how things once looked. And there’s something about it. They make great movies for them. ” According to Sarandos, when people say that Netflix “smashed” Hollywood, they’re talking “very narrowly” about the closure of local cinemas. “It wasn’t Netflix’s fault,” he said, but “it was because people were changing their behavior.”
Sarandos repeated a previous comment about the impact of AI on entertainment. In other words, technology should help to enhance creative processes. “AI is not going to replace storytellers, we’re creating tools that can tell stories that have never been seen before,” he said. “We’re creating tools for filmmakers, which allow them to tell stories they couldn’t tell before.” Sarandos said, “If the monetization model isn’t moving faster, is it a good business to make a $300 million or $400 million movie? These tools can do very similar things at a more controllable price.”
Balancing Netflix’s technology and entertainment aspects, Sarandos said: “I knew early on that two cultures could not be jamed together, and Reid quickly realised that. One memorable day in Netflix’s history wanted him to experience what will happen in LA at Los Gatos (headquarters). The wife of Odenkirk, a talented booker, including Zach Galifianakis, Sarah Silverman and Patton Oswalt, to line up ten great comedians.” “It gave the impression that people talked about it for the next year,” Sarandos says.
As a teenager, Sarandos said, he wanted to be a journalist. But one day, as he was editing the clip, he said, “I realized that I’m not a very good writer and no one ever told me.” But he also loved films. At the time, he worked part-time at a video rental store.
When he grew up in Phoenix, Sarandos said it was “always confused in my house” and that his parents had four children in their 20s. For example, he said the kids didn’t have a set of bedtime. In contrast, the TV had a structure: “Happy Days was on Channel 3 every Tuesday night at 7am. ”
Sarandos also shared that he will wake up with his mother and watch “Tonight’s Show starring Johnny Carson.” “And she always talks about celebrities by her first name. It wasn’t Carson. It was Johnny. “Oh, can you believe Johnny last night?”
“We always thought we were poor, and my mother realized that money was really bad… my dad blew the money… we might not turn on electricity and gas at the same time.
When he was ten years old, Sarandos’ parents went to Las Vegas for Labor Day weekend. And they dropped him alone by Jerry Lewis Telethon, who benefits the muscular dystrophy association when Jerry Lewis Telethon broadcasts live from a hotel on the strip. “You’re in line and coming back 24 hours a day. You’re going to this in Las Vegas at just 10,” Sarandos, 61. I’ve had the opportunity to see and learn about it. ”
A “Aspire” podcast for Grede will be created and distributed in collaboration with Audacy. In addition to Skim, she is CEO and co-founder of Khloe Kardashian’s Good American Apparel Brand. The British entrepreneur was also the first black woman to serve as an investor in the “shark tank.”
