Netflix CEO Reed Hastings Resigns, Positions the Streaming..
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Netflix CEO Reed Hastings Resigns, Positions the Streaming Service for Better Profitability

Reed Hastings, Co-founder of Netflix, has stepped down as the co-Chief Executive Officer of Netflix. His resignation was featured in a blog post published by the company. Hastings, in the post, said he will now serve in the capacity of the executive chairman of the company. He also revealed that Greg Peters would move up from Chief Operating Officer (COO) to co-CEO with Ted Sanders.

In his words, Hastings wrote, “I’ll be serving as Executive Chairman, a role that founders often take (Jeff Bezos, Bill Gates, etc.) after they pass the CEO baton to others.” The co-founder who noted that he had worked closely with Ted and Greg for 15 years “looks forward to working with them in this role for many years to come.”

The announcement which comes at a time Netflix faces increased competition from Disney, Amazon, and Hulu, boosted the streaming giant share price by 6%.

Hastings and Netflix: 25 years ago

Netflix has grown through different stages over the past 25 years. Starting with an innovative idea of paying $3 or $4 to rent a movie, to streaming movies online, Netflix has witnessed varying degrees of change. Notably, the streaming giant moved from mailing DVDs to people’s homes to selling ads, something Hastings initially didn’t approve of. The recently introduced ad-supporter tier on the platform is seemingly doing well, as Netflix hinted that it added 7.7 million subscribers.

Hastings’s compensation as executive chairman

As Hastings become the executive chairman, he will receive an annual salary of $500, 000, with no target bonus. He will also have a stock option allocation of $2.5M. Furthermore, the company also noted that Greg Peters, the newly appointed co-CEO, would receive an annual salary of $3 million. Greg would also receive an annual stock option allocation of $17.325 million and an estimated target bonus of $14.325 million.

Great leadership lessons from Hastings’s resignation

First, Hastings’s self-awareness is quite commendable. Unlike other leaders who like to stick around and frustrate the team and company, Hasting sees that Greg and Ted possess capacities that can accelerate the company’s growth better than him. Secondly, Hasting’s trust and respect for the team are notable. Third, the collective failure and successes recorded over the past 25 years have strengthened work relationships in the company. Finally, the co-founder’s resignation encourages leaders to stay open to new ideas and growth in their organisation.

NEXT:Why Netflix is Laying Off 150 Staff as Users Face New Restrictions

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