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The $250 Billion Whoopsie Daisy

Once upon a time, in the land of fluorescent-lit movie rentals, Blockbuster was the undisputed king. If you wanted to watch a movie in the early 2000s, you had two choices:

1. Drive to your local Blockbuster, wander the aisles, and pray that the last copy of The Matrix wasn’t already rented.

2. Stay home and stare at your blank TV because streaming wasn’t a thing yet.

At its peak, Blockbuster boasted over 9,000 stores, millions of customers, and a near-monopoly on Friday night entertainment. The company even made $800 million annually from late fees alone. Life was good.

Netflix, Enter Stage Right

Then, in 2000, a little-known DVD-by-mail service called Netflix approached Blockbuster with an offer:

💡 "Hey, what if we partner up? You buy us for $50 million, and we handle your digital expansion!"

Blockbuster’s response?

😂 "Hah! You silly internet nerds. Nobody wants to wait for DVDs in the mail. Streaming? Sounds like science fiction. Now, if you’ll excuse us, we have late fees to collect."

Netflix walked away. Blockbuster’s CEO at the time, John Antioco, reportedly laughed off the offer.

Fast forward a few years, and something strange started happening:

• People did want DVDs mailed to them.

• They really didn’t want late fees.

• And broadband internet made streaming a real possibility.

By 2007, Netflix had pivoted to streaming. Just 3 years later, in 2010, Blockbuster had filed for bankruptcy. Today, Netflix is worth over $250 billion, while Blockbuster has a single remaining store in Bend, Oregon—more of a nostalgic museum than a business.

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If we were to reframe Blockbuster’s leadership style in modern corporate-speak, it might sound like this:

📢 "We are committed to innovation as long as it looks exactly like what we’ve always done."
📢 "Customer preferences are important, but what’s more important is ignoring them completely."
📢 "Why invest in the future when we can maximize short-term profits and act confused when disruption happens?"

A classic study of why humility matters. Leaders innovate, adapt, and seek new ways to overcome obstacles. Had John Antioco shown a little more humility, we may all still be carrying around our blockbuster membership cards.

See you next week, 

Rick 

PS: let me know what you think of this week’s edition!