Netflix almost died in 2011 when they split DVD and streaming into two companies. Wall Street panicked. Customers revolted. Then they did something brilliant: they doubled down on the bet that nearly killed them.
In 2011, Netflix CEO Reed Hastings made a decision so unpopular that the company lost 800,000 subscribers in three months. He announced Netflix would split into two services: Qwikster for DVDs and Netflix for streaming. The internet exploded with rage. The stock price plummeted 77%. Blockbuster’s ghost was laughing from bankruptcy court. It looked like the end for the little DVD-by-mail company that could.
But Hastings did something most CEOs don’t have the guts to do: he admitted he was wrong about the execution but right about the vision. Netflix killed Qwikster within weeks, but they didn’t retreat from streaming—they went all-in. They started creating original content, beginning with “House of Cards” in 2013. Critics were skeptical. Why would a tech company make TV shows? Because Netflix understood something traditional studios didn’t: data beats intuition.
Today, Netflix has 247 million subscribers worldwide and essentially created the streaming industry as we know it. They survived their near-death experience by accepting short-term pain for long-term transformation. While Blockbuster dismissed them, while studios laughed at their original content ambitions, Netflix was building the future. Their comeback wasn’t just about bouncing back—it was about leaping forward into a market they created themselves. The company that mailed DVDs now shapes global culture, and that’s the ultimate comeback story.
