Reed Hastings on Life After Netflix and the Next Wave of AI | The CEO Signal

For the last decade, AI has been getting roughly twice as good every year. If that continues, which looks pretty likely, then in five years the AI will be 32 times smarter, more effective than it is today. Then you asked, what do CEOs have to do? You know, it's like doubling your workforce. So suddenly, boom, you've got double your workforce. Now you could either cut your workforce in half and stay in the same business lines, or you can use all these new resources to expand against your competitors. So you're going to see a lot of companies attacking each other, which is the great act of creative destruction. Today on the CEO Signal, we're talking to Reed Hastings, Netflix co-founder and former CEO. He helped redefine how the world watches television. Now, after nearly three decades, he stepped away from the company completely. And his next chapter looks very different. So how does a leader know when to let go and what to build next? From Semaphore, this is the CEO Signal. Hi, Penny. Hello, Edge. So we've got Reed Hastings on the show today. He is a CEO who's built one of the most consequential companies of our time. I think it's no exaggeration to say that. He starts with a DVD business that he's mailing out to his customers and really transforms that into a streaming giant globally. And I'm interested that having built something like that, he didn't chase another Netflix-sized opportunity. So I want to dig into how he did go about thinking about constructing this portfolio of activities that make up his second act and how he went about leaving the first act behind. I know from experience that abrupt transitions can be really rough, but this one wasn't so abrupt. I'm really curious how much of his succession was planned or did it just evolve? You know, think about it. He's got two guys, Ted Sarandos and Greg Peters, who he's really trained and raised up. When does he know they no longer need his judgment? So his next chapter looks completely different. He's running Powder, which is a ski resort in Utah. He's also sitting on the board of Anthropic, one of the most consequential AI companies of our time, and he's continuing decades of philanthropic work in education as well. Absolutely. I'm curious to understand how he figures out what deserves his time. Let's bring him in. The CEO Signal is presented by PwC. Are you ready to bust some silos? Zero full stack mesh. Left hand meet right hand. At PwC, we don't just talk tech. We make yours work harder together. Great plan. Let's do it. So you can become a more intelligent enterprise. Reid, thank you for joining us. Oh, what a treat. So we're catching you just after you've stepped down from Netflix. After 29 years? That's one way of putting it. I stepped down as CEO three and a half years ago, so that's the big moment. The little moment is getting off the board, which is just recent. And so how does it feel to be? You know, a lot of different feelings. So pride at the succession going well and the company doing well. Excitement for the guys who took over, had worked with me for 20 years. So I'm happy for them. And then, you know, a little tinges. I don't know, like when your kid goes to college or something, or you're like, I miss him. I want to be in the meeting. I want to be in the room, you know, in the flow. So I miss some of that. But I decided to try something totally different, and it helps to stay really busy. So I threw myself into Powder Mountain, a big private ski luxury real estate development project in Utah. And that has consumed tons of time in a very complimentary, non-competitive way. That's great. So leaving the board, you hinted at this. Is that meaningfully different than stepping down as a CEO? Yes, it is. I would say it's like being a godparent versus a parent. So, you know, you're a parent. You're on the front line. That's being CEO. And so then you step off of that, and life changes a lot. The board, when things are going well, as they have been for Netflix, you know, is a pretty easy gig in a relaxed form. And so getting off that really hasn't been a big transition at all. Not left a hole for you? No. I still talk with them socially, and, you know, we hang out some. But the dramatic one is going from, you know, 70 hours to, you know, one of work. That's the drama. Has it all been social, or have you been tempted to call up Ted and Greg about business matters too? No, I've been very disciplined on that. And the good news is for the first couple months I would lob in some things, and they were clear that they knew, you know, and we haven't worked together, that they were able to say what would Reed think, and then they sort of put that aside and do what they think is best, which is what they should do. Right. So they can mimic me and conjure me easily. I'm very predictable in that way. So you're the first CEO that we've had on this show who's left a giant job and started a second act. Tell us how you're spending your time now. Yeah, so much fun. I've been a lifetime skier, very enjoying it, but not much time to do it, and retired from Netflix in January, went to our ski house, which is in Powder Mountain. But, again, just a customer, a kind of one-acre customer, and spent the rest of the winter skiing because suddenly I'm not in business meetings. And at the end of that season decided to buy the mountain and to fix it up. And so it's 10,000 acres, which is almost as big as the island of Manhattan. It's quite large. It's a glorious resort that needed some work and was losing money. And it's still losing money, but now we're investing a ton, new lifts, and a big private luxury real estate development, a lot like Yellowstone Club, but like an artistic younger version of the Yellowstone Club. So before we go into that in more detail, let me ask you, you've led a transition. When did it go from succession planning at Netflix to you thinking about you and what you were going to spend your time on? I wasn't planning on Powder, so I would say, okay, finish Netflix 2023, January, handed that over, and then spending the winter skiing was unwinding and reflecting, and as it turns out, getting sucked into a different model, which is to really try something very physical compared to, say, very virtual, very local rather than very global, and then you know all your customers as opposed to Netflix, which is vast. Was that a deliberate decision to react? You'd spent a life being global, virtual, and dealing with millions of customers, and were you reacting to that and looking for something that was the opposite? Absolutely, of trying something quite different. So can we take you back to the beginning of the succession story that led up to this new chapter? Yeah. It was 2020, middle of COVID. You appointed Ted Sarandos as your co-CEO, and at the time, I remember reading you saying you're looking forward to the next 10 years at Netflix. What changed? I think COVID probably changed a lot of things for me. I didn't get particularly sick. I didn't lose anyone really close to me, but I definitely felt like, wow, life can have some twists and turns, and I realized, okay, I could maybe stay at Netflix for 10 more years, but I think my life, I'd spent 25 years doing it every day, could just be different and more interesting, and that Ted and Greg were fully capable of running it. It's not that it was going to run worse. It probably would run better. So those combinations really brought it home for me. So your exit from Netflix was not abrupt, but rather feels more like a process than a moment to me, and you made Ted your co-CEO in 2020, and Greg was the COO then, and then two and a half years later, you made them co-CEOs. So promoted Greg, really. Ted's role stayed the same, promoted Greg. Exactly. As you became Chad. Yeah, that's right. So what did you see during that period that convinced you you had the right succession was for Ted and Greg to lead together rather than, let's say, Ted, who'd been your co-CEO, just take over? Yeah, I would say there was nothing hugely specific. It was the general they're working together more and more, getting used to that. So it was just a bunch of very positive interactions and also some difficult moments where we're working through things, and that's what builds the bonds. That just made me confident that I could move forward and that they would pick up the mantle. As a journalist, I've covered quite a lot of co-CEO arrangements, and they don't always go smoothly. I've seen stories where one co-CEO falls out with the other or where parts of the organization are trying to work around one co-CEO to get an answer they prefer from the other co-CEO. What have you learned from being a co-CEO yourself and then handing off to two co-CEOs about making that relationship work? Yeah, I don't try to pitch it as a general model. I don't run around saying, oh, we've discovered something. You should always have co-CEOs. I think of it as a high-performance technique. If you've got two people who really trust each other and who love the organization more than themselves, then you can get some real benefit because two people can be in different places, different times, so it works really well. But again, it's a rare set of personalities to make it work so well, which we were fortunate to have. Did they push you to say it's time for us to be the co-CEOs and you to be chairman? Were you pushing them that you ought to come closer? You two seem to lead well together. How was that dynamic? They weren't explicitly pushing in any way, but I was ending up giving them more and more discretion. They were effectively operating as co-CEOs for a while before I formalized it in promoting Greg into my position. I'm curious. Who makes the final call in a co-CEO structure? I'm thinking of the big call Netflix had to make this year to walk away from the Warner Brothers discovery deal that you looked at for a while. Was that Ted? Was that Greg? Was that ultimately you as chair? I wasn't involved in that call. Really? Really. It was them together sorting through it, which is here are the trade-offs and coming to that decision on its own. Again, we would have stayed in at the same price, but the bid went up. It was really a question of raise the bid or not. That was the question. It was price rather than strategy? Yes. Again, we were very comfortable with the strategy and we were comfortable with the price that we had paid or had offered to pay. We were very excited about doing the deal. Then capitalism is a great system, and so another bidder, Larry Ellison, raised the bid and paid Warner Brothers even more. Then we had a chance to match. It's all very clean. We decided not to match. When did you know they weren't going to need you and your judgment anymore? I would say that was a phenomenon of growing confidence. In other words, probably five years ago, 10 years ago, I was like, I think that's going to be true. I think that is true. Then it becomes more and more true over time. I would say through COVID, we were all stressed and they made just tremendously good decisions together. I would say that's the real proving ground. Did it take some effort to get your board to get comfortable with this structure, or did they just say, oh, I see it and it's obvious? No, they were very involved and we very much contemplated the standard alternatives. What if it's just one of them? What if it's an outsider? What if you don't go? All these different elements. They participated throughout that process and were good counsel and independent views. You built Netflix around a very distinct set of leadership principles, which are so fascinating. I think you've written a lot about this. Radical candor, the keeper test, giving people context rather than control, which I love that. Looking back, where did that culture really work and where did you have to course correct? We wrote a whole book about that, No Rules Rules, to help other entrepreneurs build upon it and improve upon it. I benefited so much from all the literature before I was trying to lead. This was a giveback to go through all that. To give an example, and that all came together organically over 10 or 15 years, when we first started in 1997-98, we had no specific culture, really. We were just like, are we going to survive? Then there was the 2000 internet slowdown. We did do a big layoff. That was the first surprise and lesson is after the layoff, we were like, wow, we're actually getting more done, not less done, even though we laid off a third of the company. We would have never have done it proactively. We tried to figure out why. Of course, the answer was talent density, which is you did the best you can to hold on to the two-thirds that were going to most help you. We realized, wow, maybe we should do a one-third layoff every year. Of course, that's impractical, but we said, how about if we keep the bar high and really think about us as a championship sports team rather than a family. Then year by year, these kind of ideas came in. Then in terms of management, the context not control and the informed captain and the farming for dissent, all of these shorthand phrases came in over time as we worked through the system. Did you find the company's receptiveness to that set of values changed over time as people got more acclimatized to them? Sure. Employees want to understand change and you want to frame it as an alternate and often superior set of values rather than abandoning of good values. Let's take a tension between kindness and honesty. What do we want in our kids? We want them to be kind and we want them to be honest, but then they grow out. When they're very young, they say, why is that lady fat? Then we teach them about that tension and then we teach them to be a little less honest and more kind. That's a values tension. Same thing in the workplace, but in the workplace, we want you to be very engaged with feedback to help us all grow in our performance. We explicitly say lean into honesty and it will feel unkind and here's why, but it really is the right thing to do in this professional context. You have to frame it as there's a values tension. We're explicitly choosing a different place on this continuum and here's why. Team over family, both are good metaphors. People respect great teams and they respect families and how we operate, but if you describe yourself as a family at a company, you better not ever do a layoff. You would never lay off two of your kids, so then people get very cynical if you say it's a family but don't operate that way. If you say it's like a championship sports team and we've got all these competitors and we want to win the championship, then people understand why the coaches make changes throughout the year to try to do their guess of the best way to win the championship. Can I dig into a concept that it's really interesting to me, the idea of farming for dissent. It's really hard to get a group of people who respect each other to actively seek out disagreement. How'd you do that? How'd you make that work? How'd you make that a real, real Netflix? Well, I would say the top-level way is naming it, so calling it farming for dissent, so then we're clearly trying to generate it. Then there's a bunch of tactics underneath that of what are the other opinions. Then we would do exercises if we're trying to make a decision. We talk about leaders being an informed captain. How do they get informed? They might poll all their people and we would score it on a negative 10, it's disaster, to zero, I'm not sure, to 10, this is the best thing we could ever do and have everybody say their view and why. It wasn't a democracy. It was you might get a whole bunch of negative threes and still decide to do it, but you wanted to be informed. Those were exercises in farming for dissent. Then we'd have great fun five years later, go back and look at the decision, who had been for it, against it, whether that was global expansion or what show we're going to do next or whatever the decision was. What did you do with that hindsight? Specifically, it was just get you to think more carefully about the future because you can't undo those decisions. Each person had a chance then to analyze what did I guess wrong in that frame and how do I move that forward. Can you give us an example of when dissent helped change your mind? Well, I would say there's, when you say change my mind, that implies that it's like I want to do X. Think of it more of like we're exploring something and in particular, it's important for the leader to keep an open mind. You're not farming for dissent if you say we are definitely going to do this show. I just want to hear any contra opinions. It's like, okay, there's no point to that. Yeah, that's not a conversation. That's right. And so, I would start it off and be like, I think the show that we're doing in Latin America and it's something that's new and fresh but I'm worried that the downside is that we get in a huge fight with all the traditionalists. So, a little framing of reasonable arguments for both sides and then we would go at it of okay, the particular texter because we cast these three people, what are they associated with, the way it opens, you know, those comparisons to other series in the market, that would be the typical discussion. And Netflix is moving on from its founder era with your departure from the board. How do you think that's going to change it? Well, it's got to change it a lot because every new, you know, if they're going to improve the firm, they've got to be not trying to relive how I did things. They've got to be able to find their own models and that comes with making their own mistakes and it's just continuing to kind of grow the firm and to earn more of consumer's business and time. So, I'm not sure in what specific ways, that's kind of the joy of it. It's sort of them able to express themselves and their ideas in it. You've gone from leading in rough numbers, about 15,000 people to, I think, when you start to powder it's about 150. That's right. Totally different order of magnitude. How much of the Netflix leadership model applies on powder? Oh, the vast majority of it. I mean, skiing also has a safety culture. So, around safety issues, you don't want to be freedom and responsibility. So, like lift safety and maintenance. There's some things that are pretty highly regulated, not quite airline level, but like close to that. But outside of that big difference, in terms of empowering people, in terms of moving the decision-making down, in terms of farming for descent, all those things have worked very well. Powder has an unusual business model. Can you talk us through how this mountain works? Yeah, it's actually not that unusual in general. So, in golf, there's 4,000 private golf clubs. In the U.S. But in skiing, there's only 3. And it's partially because you need a lot of acres. But it's basically the same model. You got a clubhouse, a membership. You know the people. You get better tea times, a restaurant, social atmosphere. Everyone who's a member of a golf club gets it. What if that was applied to skiing? And then it was much less crowded, and you knew a bunch of the people, and friendlier. So that's private skiing. Now, we also have public skiing, and that's working well, too. That's on a different side of the mountain. Curious that you decided to go in as CEO. You could have been just an investor or an advisor. What made you think, you know, actually, I want to take an executive role here? Well, any CEO would tell you they love running things. I mean, you know, it's having meetings, making decisions. All of that's really exciting. So is this a passion project or a real business? It's a passion project. Yeah, the big goal is to build a community that is so enticing that Patty and I want to spend a third of our time up there. And it's so vital and going on. Second is to really build a place of beauty that's to do with the art and just the way everything is curated, the architecture, that you just have an aesthetic wow. And third is that it makes a bunch of money, which, you know, I like capitalism. It's a good marker. I think it's going to be very successful. But that's the number three. So I'm very curious that you've decided to focus all your energies on a single mountain, not just because of this pendulum swing from the scale chasing that you did at Netflix, but because so much of the ski industry now seems to be about the multi-mountain part. It's about trying to get everyone access to everything in a single company's orbit. Why have you gone the other way from, let's say, a company like Vale Resort? Well, I think Epic and Icon, the two big multi-buses, are great innovations and they're potentially strong businesses. Think of them like Costco. They're sort of mass market. You know, it's great value and that gets more people skiing and so we love that. But then we're trying to be super boutique, high-end, luxury, special. So frankly, they're the most important business and we're kind of the most beautiful one or the most enjoyable one with no compromises, just incredible skiing and limited to the 600 families. And are the locals who've been skiing on powder for 50 years, are they reacting well to the idea that some of it's more exclusive? How's that being received? You know, there's tensions. It's inevitable, but we've invested a lot in the public ski area, adding three new lifts, adding snowmaking, adding new lodges. So we're really trying to improve the public side and they see that. So they don't love it, but it's not a big tension point. So welcome to the hospitality industry. There we are. Got to get our hotel up and trying to figure out what should be the sort of signature hotel at the top of Powder Mountain. I mean, it is quite interesting because at Netflix you were bringing affordable entertainment to the masses and here you're doing something very different where half this mountain is reserved for 650 households. So what's your response to the people who don't love it? This is one path that Mountain could have gone because the mountain was in financial trouble and it was going to change no matter what. And it didn't go the way of just becoming a classic, you know, very crowded resort. So it's a turnaround for you. Oh, very much so. Again, I wouldn't, if it was running fine, I probably would have stayed a customer and just had my house there. But living there and seeing the needs that it had and the opportunity, that's what really pulled me in. And it's the people who are in the community, the 200 families that I love and have gotten to know and they're all curious and happy and healthy and successful. And it's been just a really fantastic community. The CEO Signal is presented by PwC. AI is delivering efficiency, but it's also creating something else, a workforce dividend. As AI frees up human capacity, expertise, and time across your organization, that dividend begins to emerge. The question becomes what to do with this surplus. Realize the immediate profits and reduce spending or invest them in future growth. Treating AI solely as a cost opportunity risks trading tomorrow's growth for today's margins. The real leadership decision is what to build with the value AI creates. How leaders use their workforce dividend today may shape their long-term advantage. I want to shift to another part of your portfolio career, post-Netflix. You sit on the Anthropic Board, and there's quite a strong through-line here. You studied AI, as I understand it, when you were in college. No, no, crazy. In 1986 to 88, I got a degree in AI. What were you writing about it then? Well, AI of the time was writing down specific facts or inferences or rules. Ultimately, those systems never worked. Way too rigid, way too specific, didn't encode how we think. And then, you know, 40 years later, neural nets are now big enough to be incredibly profound and interesting. But there was no way to do that in the mid-1980s. So we were just way, way too early. And so the new techniques have worked very well. And we have, you know, incredible improving intelligence from all the frontier labs. And, you know, we're beginning a new phase of humanity when we're not the most intelligent creatures. And we'll see. I mean, you know, today you are generally more intelligent than AI about a field you really know. But when you ask it about lots of other fields that you don't specifically know, it's very helpful. So, you know, people say it's, you know, like a graduate student in a whole lot of areas, but not yet a PhD. But it's improving. So, Reid, obviously, sitting on the board of Anthropic, you get to see an extraordinary amount of what's going on. How's that affected your attitude? You know, I would say the Anthropic team is very committed to the mission of bringing AI about in a beneficial way for humanity. And that's their North Star more than the biggest capital stock and the biggest company. They're at their heart more humanist than capitalist. And the challenges that they face are many because all of their competitors are moving very quickly. You know, so that's the challenges. But they're very incredible human beings and also very good cognitive scientists. What do you think corporate CEOs are still underestimating about AI or misunderstanding about how it's going to change their companies? Well, for the last decade, AI has been getting roughly twice as good every year. If that continues, which looks pretty likely, then in five years, the AI will be 32 times smarter, more effective than it is today. So just think about you're using, you know, one of the frontier models today and it's pretty impressive. And think of it that 30 times better just in five years. Okay? And then in 10 years, that's a thousand times better. Then you asked, what do CEOs have to do? You know, it's like doubling your workforce. So suddenly, boom, you've got double your workforce. Now you could either cut your workforce in half and stay in the same business lines or you can use all these new resources to expand against your competitors. So you're going to see a lot of companies attacking each other, which is the great act of creative destruction. And, you know, because it's gotten easier and easier to make software and soon it'll be easier to make everything. And you've lived through some of the most important waves of creative destruction in the media and technology industries. When you look at this moment in AI, do you think most CEOs are still underestimating how much disruption is coming to traditional business models? I think most humans are underestimating what doubling every year, that's an exponential rate of improvement, is going to do. So we don't have many. I mean, cars didn't get better at that pace. Computer chips did, but they were sort of buried a little bit, you know, as one part of the economy. But it's very rare for things to be improving exponentially. And, you know, there's no guarantee that it will continue to do that. It certainly looks like it because there's, you know, so much focus on it. What's the CEO's role in guiding AI policy within a company? You know, the CEO's role is to really keep an open lens around the right things. Okay? It's easy to say only the paranoid survive. And in some sense, that, you know, makes a point. But taken literally, the paranoid have delusions. They're delusional. Okay? And if you spend all your time worrying about things that are very, very unlikely to happen, a comet hitting the planet, then that's not time focused on scenarios that matter more. So I would say only the paranoid survive in codes is way too simplistic. Okay? It's really the people who have judgment that survive. Which cases, which threats, which opportunities, and how do you sort through them? Sort of like a master chess player, you know, goes certain scenarios, they go very deep. Other scenarios, not so deep. And if you get that wrong, you lose. That's the art of the strategy side of the CEO. Is that also a point about the risk of focusing too much on the downside, potential downside, and not paying enough attention to how this technology can unleash new opportunities for a company? Well, both are important. But often we don't have that much control over some of these scenarios. Like you can worry about will it destabilize monetary policy? But if it does, you'll just have to cope with it. So what you, you know, really need to do is focus on your customers and kind of values horses, things under your control. But there's a lot of positives to the huge productivity that we're all experiencing. Let me take you to your kind of new life here. You've gone from this very online world of streaming to this very offline world of skiing. How much are you using AI yourself as you get to grips with these new industries like real estate and new technologies like ski lifts? All the time, because I'm asking AI to teach me how ski lifts work, how sewer systems work, what property developments have worked and why. So I'm the student for so much of the AI session. And then we're using AI to improve the software in place. So your application for moving around and buying things and all of that and integrating the front end and back end is all so much easier to do now because of AI. So everywhere we can, we're using AI. As are, you know, everyone around the world, which is why the revenue of those frontier labs is growing so fast. I've heard, we've heard a lot of CEOs say big companies have the resources to truly invest in AI and get the most out of it. It's going to be harder for smaller companies to match that. When you look, having gone from the resources of a Netflix to the resources of a powder, do you see that disparity? Do you think you are a little on the back foot against the epics and the icons in terms of your ability to deploy the technology? No, I think sometimes the small companies are the most innovative and will be the most aggressive users of AI to unlock various scenarios to compete with their competitors. So it varies, you know, quite a bit. So I think it's more attitudinal than the size of the firm and certainly depends on the applicability of it. So let me ask you something on a totally different subject. We share a passion for K-12 education and its importance in society. You served as president of the California State Board of Education. You've championed charter schools and you're on the board of Khan Academy. What do you think your personal impact has been there beyond being philanthropically active and providing financial support? Well, any great society needs a great education system and that provides as many kids as possible the opportunity to flourish and we're making some real progress. Charter schools are non-profit public schools, but they're independently run like a non-profit. They can be more efficient, more effective, and they are much of the time. So that's been one big wave of improvement and reform. And then the second one is technology. How can technology be well done for schools and students? And there we don't really have any amazing positive results. People sometimes associate social networking and sort of negative things with technology in schools. But honestly, using computers in schools makes a lot of sense. We have to figure out how to do it well. And the big breakthrough to come is letting kids learn at their own pace. Today we've got a very regimented system, fourth grade, fifth grade, sixth grade. And a lot of kids are behind and feel dumb. Some kids are ahead and feel bored. Super hard as a teacher. It'd be so much better if kids could learn at their own pace. And that's what technology is going to be able to allow over the next couple years, where you're constantly learning. And we just sort of let the notions of the fifth grade curriculum become less important, and the notions of kids flourishing and excited to learn new things continue to grow. So I'm optimistic that technology and AI is going to have a really positive effect. But again, the current technology doesn't yet deliver on that promise. Okay, we're getting closer, but we need the AI to be more engaging, more thoughtful, more safe. There's a lot of things that everybody's working on. But we're getting back to the doubling, the rate of improvement. AI is getting better and better and better, so it's going to crack this one. But isn't there a sort of valid question about whether you want young brains to be turning to AI to learn how to think? Well, let's see. Let's look at chess. So chess was solved by computers 30 years ago. And what's been amazing is instead of abandoning chess, there are more active chess players than there's ever been. And the typical or median 10-year-old, 15-year-old, 20-year-old are significantly better than 30 years ago. And the why is because they're getting AI chess tutoring. And on average, AI chess tutoring is much better than your uncle. And so it's really opened up the field. So I hope that we can do that for biology and politics and chemistry and maths. So I don't want to rush into it. It's like, okay, maybe in five years we're ready here. It's not quite today, but I really think it's coming. And then AI is going to be first much better than the typical and then much better than the very best and then much better than all teachers. Because, again, it can be so patient. It can be steady. And it's been following you your whole life. It's all kinds of positives. So it's got an unfair advantage. But, Reid, don't you think also with, let's call it, effective and responsible AI in a classroom that the role of the teacher changes? Exactly. In other words, as opposed to, I'm a transmitter of facts, instead I could be much more engaging with you in judgments about what do we do with a set of facts. And how to work with other people and emotional regulation and all kinds of important things are not limited to the curriculum and to what's tested. Actually, really important stuff is around emotions and communication and teamwork. And that's what the teachers are going to be able to focus on. But that's not what they were trained to do. That's not what they went through teacher school. That's not what they've been used to be doing. So it's still a big change. So these are big policy questions. And you're a relatively unusual CEO in that you were a meaningful political donor even while you were running Netflix at a time when a lot of CEOs have been running away from anything that looks remotely political. Now that you're free of the big job and you're on a mountain in Utah, are we going to see more political activity from you? Not particularly. I'm a supporter of politicians that are steady and have good ideas. And I've supported some Republicans, more Democrats. But I'm not a kind of core partisan. I don't define my life that way. Trump I mostly disagree with. But when he does something I agree with, I try to make a point of expressing that. I think we should take these things issue by issue in trying to seek what's the best possible country. Can I ask you just to wrap up finally for us? We've talked about individual pieces of this portfolio career that you've built for yourself post-Netflix from powder to philanthropy to your board responsibilities in AI. Is there a thread that ties them all together? The only thread I can think of is I love taking risk. I love challenging myself and all the things that we're doing are really hard. Whether that's education, powder mountain, AI, Netflix, work before that. And, you know, there's something very stimulating about big challenges where you really might fail and then working really hard to avoid that and to hopefully have a big success. I always say it's a privilege to work on hard problems. Reid Hastings, thank you so much. This has really been a pleasure to learn from you and to hear your story. Thank you guys. Thanks for joining us. Thank you. Stay with us. Penny and I will be back after the break with the readout. Are you ready to bust some silos? It is time to get on the same page. Zero full stack mesh. Dynamic collaborative egresses. One plus one equals three. Left hand meet right hand. Break down silos. At PwC, we don't just talk tech. We make yours work harder together. Great plan. Let's do it. We'll get that going. So you can become a more intelligent enterprise. So Penny, I thought that was fascinating. Not least because of how deliberate he's been in choosing to do something that's the exact opposite of what his life at Netflix was. He's gone from the ultimate mass scale digital experience where you're selling to millions of customers you never see to this very physical world in real life world where he's focusing on a very local community and you literally can walk down the street and bump into every one of your customers. Absolutely. I think the word deliberate comes through for me about him. He's had a very successful succession planning effort but it's been incredibly intentional and it took quite a long time. He really grew Ted and Greg to be the leaders that they are and then brought one in as his co-CEO, brought the second in as co-CEO. He also recognized that his role had to change as he went from being CEO to being chairman and he talks about that's like going from being the parent to the godparent of your company. I love that. I love that analysis and look I think ultimately the test of this succession process will be whether anybody makes a Netflix drama about the succession at Netflix or not but I think it is an extension of the culture the leadership culture he tried to foster while he was CEO and then moving onto the board. I hear a lot of CEOs talk about values. I'd never heard one talk about values tension there. He talks about you know the need to be honest versus the need to be kind and what's the balance. He also talked about the need to what kind of team do you put together? Is it a family? Is that the kind of culture you're creating? He prefers one that's more akin to a championship sports team where you're really calling for the best of the best on your team. And so what he's saying with that values tension phrase is he's willing to put up with a little bit of friction and trade that for higher performance. Then we had a fascinating part of the conversation about AI and I suspected given his you know 25, 29 years in a very disruptive company and then his role in Anthropic that he'd have strong views on this. I think he gave his fellow CEOs a couple of very clear ideas about what their role is to lead through this particular change. I think that's about balancing responsibility with curiosity or open-mindedness. Yes. He really would. He leans in on open-mindedness but in the end I think he thinks AI is the ultimate disruptor and that you as a CEO need to really be on your front foot thinking about what's coming at you. Because he's talking about the power of this technology doubling every year. You think about this technology being 32 times more powerful in five years' time. That's within your planning cycle and I think the message really that I took away for his fellow CEOs is that some of you are going to end up being blockbuster if you don't get on the right side of this because other people are busy building the next great disruptive Netflix. Absolutely. It was fantastic. Thanks Penny. Thank you Edge. And for more conversations like this don't forget to follow the CEO signal wherever you get your podcasts and like and subscribe.