Latest / Success Story with Scott Clary / Lessons - Why Your Best Ideas Will Fail | Marc Randolph - Netflix Co-Founder

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Lessons - Why Your Best Ideas Will Fail | Marc Randolph - Netflix Co-Founder · Success Story with Scott Clary

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  In this lessons episode, explore why entrepreneurial success depends less on perfect ideas and more
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  on rapid collisions with reality. Discover how embracing flawed concepts accelerates iteration.
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  Understand why quick and simple tests reveal insights that planning cannot and uncover how creativity
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  and persistence drive founders toward solutions that truly work.
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  So that was the that was the first iteration of of Netflix and I want to pick up on some themes
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  that have sort of permeated that process but also things that obviously you speak about now.
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  So before we go down that story even further the concept of it will never work the game that you
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  why is that your core theme what does that mean why is it so important this is an entrepreneurial
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  lesson. Well on the surface every single person who has an idea who fancies themselves an entrepreneur
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  hears that it's what everybody says when you come rushing with great excitement into the office
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  to tell them this new idea it's what your wife says to you it's what your investors say to you
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  it's what your employees say to you it is the universal response to I've got an idea
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  but I've realized that nobody has any clue whether it's going to work or not that in fact there is
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  no possible way to really know in advance whether an idea is a good idea or a bad idea without trying
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  it so that will never work you know it's the name of the book it's the name of the podcast it's
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  the name of the clubhouse room all the things I do revolve around that will never work because it's a
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  reminder to me and I hope to everybody that it's just unknowable and that if you let someone say
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  someone tells you that will never work and you walk away from that going oh I guess it won't work
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  you've made a grave mistake that what you have to do is go well we'll see and then move to that
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  next phase of saying we're going to figure out some way to find out but that also ties into
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  another theme that you speak about quite often where no ideas are good ideas so it's it's almost
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  at a high level without understanding it's conflicting but walk me through the the no ideas
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  are good ideas concept as well so anyone who's worked in any kind of corporate setting is sat
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  in on a brainstorming meeting where the well-meaning moderator gets up in front of the group
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  and goes okay let's get some ground rules here rule number one for this brainstorming session is
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  there's no such thing as a bad idea and I call bullshit on that I think in fact there's plenty
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  of bad ideas in fact I'll go out and a limb and say they're all bad ideas in fact there's no such
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  thing as a good idea every idea is fluid they're all not going to work there's always something wrong
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  I have never found a successful company that became successful doing the thing originally envisioned
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  and if you recognize that no such thing as a good idea after all bad ideas what you recognize
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  is it's futile to keep searching for this perfect idea then in fact what I've got to do is recognize
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  the skill here is not coming up with good ideas the skill is figuring out a clever way to try
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  something to quickly and cheaply and easily collide your idea with reality that's why this I
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  harp on the fact that there's no such thing as a good idea I don't want people to get stuck
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  in this rut I've got to I keep finding flaws and listen forget it stop thinking about it start
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  doing something take the idea and as soon as you can collide with the reality and you are going
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  to find out that it's a bad idea but that's fine but the important thing is not that it's bad the
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  the idea is why is it bad because usually in an association with all the reasons you realize it's
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  not going to work as you envisioned it informs your intuition you get some insight into what might
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  work and you come oh okay let's try this and let's try this and it's that process of iteration of
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  jumping from stepping stone to stepping stone that ultimately does lead you to a place which
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  is interesting and you know I've I've worked with so many companies I you know the size of the
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  companies that I've done with since I left Netflix which is you know 15 plus years ago I've
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  not a chance to work with hundreds of early stage companies and thousands of entrepreneurs and
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  over and over and over again the things that finally work are never the first thing you try
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  it's always this really interesting process of starting and seeing where those
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  collisions with real people lead you why do you think that so many entrepreneurs seem to
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  over iterate on that MVP as opposed to trying to have that conflict and real feedback with reality
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  with real people to actually validate very similar to the way that you did with just simply mailing
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  you know a music CD to to read house you have a I think listen if you're building if you're building
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  an MVP you're building an minimal valuable product you're building too much and the the problem
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  and it's whether it's an MVP whether it's actually raising money all these things that people do
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  because they think that's how this works you get emotionally invested in an approach
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  and the more effort you put into that approach the harder it is for you to acknowledge it's
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  not working the harder it is to walk away from it I mean even a minimal viable product sometimes
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  takes weeks or months or tens of thousands or hundreds of thousands of dollars and so you're not
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  about to go oh didn't work okay abandon this let's try something new which is why you've got to
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  figure out ways to do it super cheaply super simply super quickly and it's parsing it apart you
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  want to build a minimal unviable product and listen I gotta I'll give you a very con a couple
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  concrete examples here you do not need to test all the components of your idea because most of
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  the components of your idea if you begin parsing it apart are not don't need to be tested you don't
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  need to say can we build an app you don't need to worry if someone gonna trust me with their
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  credit card you don't need to worry about whether your app can know where you are I mean this stuff
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  has been generated not just that it's technically possible but that customers accept all these
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  things and you begin to isolate in on what's the one piece of it that I truly don't understand oh
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  listen rather than wasting time with kind of gives high-level Instagram worthy quote-tile bullshit
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  let me give you a specific those are also good but I mean yeah they won't unite it's like
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  just like junk food you nod your head and go oh that's so interesting and then you go back and
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  go wait wait how how do I how do I do this in fact okay so let's have some real examples then
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  let's have that let's have something promotion aspect here it's the point of the podcast that I do
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  which is I could certainly go on social media and say you know trick is to quickly easily
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  clutter the reality and it will not but then it's missing the how and so in the podcast I'll sit
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  down with someone for half an hour an hour who has an idea and will brainstorm through how and
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  you see how this works but let me give you a couple you do it right now this is from two or three
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  years ago a bit more than that actually and it's a young woman in college and had an idea and I do
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  a bunch of mentoring work at universities and she goes I have this great idea quote-unquote she
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  wants to do peer-to-peer clothing sharing she goes I have all this stuff in my closet that I never
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  wear I know all my friends have stuff that they don't wear wouldn't it be great if we had this huge
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  network of people who are all showing us their clothes we could all borrow each other's clothes
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  and I go okay pretty cool what are you what are you warning about and she goes well like
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  should I quit school or do this how do I raise money when I'm just a student or how do I find a
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  a technical co-founder to build this app for me and I'm like whoa whoa slow down or more importantly
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  speed up I go let's figure out quickly cheaply and easily whether your ideas a good idea or not
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  do you have a piece of paper and she goes yes I'm a college student I have paper and you'll find
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  do you have a Sharpie she goes yeah I can find a Sharpie I got great so I want you to do is hit the
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  paper you're right in the paper want to borrow my clothes knock and I want you to tape it right
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  now to your dorm room door and we're going to start this experiment now and you're going to find
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  something out either no one's going to knock well then you've learned something pretty important
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  right there but let's say people do knock well you're going to learn the next phase okay first of
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  all there's interest but now what happens are there problems with fit or the problems with style
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  or the problems with taste and let's say there is a match that way now you're going to find out
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  the next thing how do you feel when your blouse comes back stained or torn how do you think about
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  the fact you know off to bring everything to the dry cleaners and all of a sudden this begins
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  costing you more let's say it all works and all of a sudden you're going to start this process of
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  learning and recognize how many times you someone repeat how do I find people to do this and you're
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  going to do all of this not by building an app not by raising money not by starting a company you're
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  going to do it with three by five cards or a yellow pad you're going to do this in a non repeatable
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  non scalable way because you're going to figure it out on the ground but the point was her problem
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  wasn't what can I make an app how do I get credit cards how do I yes those are things you would
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  have to do if she was to make it a real business which she narrowed it down to the fundamental
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  problem was is anyone care and I can find that out with a piece of paper in a sharpie okay now I
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  wonder the problems with fit and taste and style I can find that out on a very very small scale test
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  of people who live in my hall and then what will happen is hopefully after six months of doing
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  this out of her dorm room with three by five cards in a yellow pad and going crazy because it's so
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  manual and so labor intensive and so inefficient but that's great because then when it comes time
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  to say I think I might like to make this a real business and you go to raise money you're not
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  waving your arms and going imagine if you will you're able to say I understand now what the
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  repeat rate is I know what the average order size is I know what my churn is I know my acquisition
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  costs are or even more importantly rather than going to an engineering friend and saying I want
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  you to build my idea which I can assure you with the marketing guy never works you sit down and go
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  let me show you what I'm doing and I'm doing it all with paper I'm doing the three by five cards
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  and and that's when people lean in and go oh that's so cool maybe you could do it this way or this
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  way and they get pulled into the problem so it solves so many problems but the fundamental one is
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  rather than dreaming about it you do it quickly and easily and cheaply by parsing out what's the one
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  thing that you really need to test and once you figure out that one thing usually that one thing
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  can be tried without technology without raising money without other people without an office without
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  quitting school without leaving your day job without mortgaging your house you can do it on the side
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  you can do it quickly cheaply and easily it's the trick the thing that's the most important thing
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  I believe for entrepreneurs starting something and what I look for the entrepreneurs that I want
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  to work with is not how good their idea is because as we mentioned I fundamentally believe all
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  ideas are bad ideas what I'm looking for is do I think this person has the creativity and the
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  persistence to say I'm going to figure out quick cheap and easy ways to try this and keep trying
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  things until I found these stumble on something that actually does work you mentioned why people
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  stick with their MVP's for too long because they put so much time and effort into it they're not
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  going to walk away but if you stick something on the front of your dorm room you wrote in a piece of
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  paper and that doesn't work when you wad it up you throw it in the trash and you write something
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  different the next day and then you wad that up and throw that in the trash and try something
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  different the third day and eventually someone knocks that's the process thanks for tuning in if you
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  found this valuable don't forget to hit that subscribe button so you never miss an episode and if
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  you want to dive deeper into this conversation check out the links in the description to watch the
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  full episode see you in the next one