Why 70% of Partnerships FAIL in the first 2 years! - Richard Ezekiel

0:0070 % of partnerships failing after two years is a stat from PwCWC, McKinsey, others. So it's grounded in real fact. Now, after two years is very key, meaning what we did at Netflix and in some of my other gigs is really it's about sort of what happens not only before the contract, but after.

0:22What would happen if we just told the truth? Welcome to TruthWorks, where we dig into the nitty gritty of leadership and work. And what needs to change. I'm Jessica Neal. And I'm Patti McCord. Our journey together started in HR, but trust us, it's evolved into something wild, honest, and well, a bit rebellious. So throw out the handbook. We're here to redefine rules to work for us, not against us. Let's dive into another episode.

0:59Hello, everyone, and welcome to another episode of TruthWorks. I am Jessica Neal, and Patty is still out recovering. Get better, Patty. We love you. But today I have a special, special guest, an old friend of mine. We go way back. His name is Richard Ezekiel. We call him Rich. Hi, Rich. Welcome to the show. Hey, Jessica. It's been too long. Great to see you. You too. I'm so glad that you reached out because you have this book that you just wrote, and we're going to get into that because I know there's a whole journey about that. But when you reached out, you mentioned how we met. And I remember that like so clearly.

1:37But why don't you tell people how we met and how we know each other? Well, Jessica, when I reached out to you recently, it wasn't as good as your cold call to me. Back, I don't know how many years ago that was. It's over. It's probably like over a decade ago. Yeah. I think it was. It's dating me. Thank you. But no, but I mean, yeah, sorry about that. But over, it's been a while, but I was working at Yahoo back in the day and in Sunnyvale in the Valley. And we were working on, I believe at that point, a pretty early stage of what streaming TV could do. We weren't sure what the killer application would be, but it was a bit of the Wild West, you know, working with consumer electronics companies across, you know, the planet, trying to figure it out and how to do it effectively with a good quality service, et cetera, et cetera.

2:27and I don't know how Jessica got my phone number, but it wasn't like I got an email. No, I don't know how I did either. Yeah, or I didn't get an email, and it wasn't like, hey, maybe we should talk. It was a voice message on my mobile phone. I didn't know Jessica at the time. She reached out with a voice message that was just a very sort of honest and open and created a relationship with a message on one side. I don't know how she did that, that I was compelled enough to call her back. She basically was very open. She didn't make it something like, she just said, hey, I'd love to connect. Love to learn more about what you're working on.

3:09We're working on some interesting things here at Netflix and would love to make the connection. And it was like, I'm always about making connections. I'm always about meeting more people and understanding how to build my network. That's always been a kind of common thread and theme that I'm always trying to do. And I had heard about Netflix, but at that time, it's kind of hard to believe is that it didn't have that kind of breakthrough of a company that we have seen grow over the last decade. So I was a bit skeptical about how we could work together, but it was more to make the connection with you, Jessica, and kind of learn more what you're working on.

3:42And I'm always happy to talk about what I was working on. I know. And then you did it. You came. I call you. You call me back. We start talking. And then what? You know, it was then making sure, I think, Jessica, what you were doing at that point was building a relationship, you know, between, you know, you didn't know me well, you had probably seen or heard my name through contacts or partners. And it was more of just like, getting to know what makes me tick. Having you introduced me some great folks that were inside of Netflix to have them tell their story about how they came. It wasn't an interview.

4:19Yeah, no. Building, yeah, it was really understanding about, like, we all, like, at the end of the day, want to make impact in the kind of work we do. We want to, you know, and work with great people. And so, you know, it wasn't an interview from day one. It's like, hey, there's some really great people working on some really hard problems to solve, you know. And it wasn't, but I navigated that for, I don't know, six to six plus months before kind of finding the kind of right kind of role. That was, yeah, it was. Yeah. But it started with the cold call. Yeah. And this is where I get so frustrated with recruiting teams in general.

4:59It's just that they don't, I don't know, they're just sort of doing it as a process instead of making it an experience. And my whole thing was like, we want to know all the best people everywhere. We may not have anything for them, but we might. But if we don't know them and we don't have a relationship with them, we won't ever get them. And if their experience with us is like every other company, we're not going to stand out. They're not going to want to be part of it. And so the whole thing was like making it like an elegant experience so that everybody that interacted with us walked away from whatever interaction wanting to work with us.

5:43that was the goal yeah yeah you know yeah no that's a lot of recruiters don't think about it that way first of all well you're at a very big tech company now um on seattle area but you've had an amazing career so let's talk a little bit about your career and your story and then your career and your story led you to write this really great book that i want to start getting into as well so tell us a little bit about your story your career and then how that led you to the book. Yeah, now this feels like an interview, Jessica. That was no, I'm kidding. I'm kidding. No, I think it's all about the storytelling, right?

6:19And I think on this one, I was fortunate to really work with and be inspired by some incredible leaders, you know, prior to Netflix, but also inside of Netflix, and then and beyond. And I think for me, it was kind of honing my passion area in my craft. And, you know, I really wanted to find this kind of like collection of of working on problems that customers are facing today, like pretty big idea, but do it with, you know, in a scrappy, innovative way with a group of folks that have that common interest and do something I could look back on and say, hey, I learned a hell of a lot, but I want to build that as a foundation to do more and learn more.

6:58And I think that gene is just in many of us to want to continue to kind of go into the unknown. And sometimes we don't have all the facts and figures to kind of make those kinds of decisions. But if we have really interesting and good people around us to support us, not just from our past, but also as we move into the next stage. I think that's where I've always had that as I've been lucky. And I think that's been just connecting and being open to connect with folks. And not every relationship that I've started or built, either professionally or personally, is still here today. But at the same time, there are some.

7:30For me, starting out in the early days from my first internship with Wired Magazine, You probably didn't know that one, but that was quite interesting. I don't know if I knew that one. Yeah. Yeah. That was a great magazine. Yeah. It was a very cool magazine. It was new at the time. That dates me. But I saw what was happening in terms of not just, hey, this is kind of like a boring technical, kind of the last decade of what was happening with mainframe computers and telecom networks were also very interesting, but it was the foundation of what the internet was built upon. Now, my Wired experience was more about like I saw a collection of musicians and artists and folks using the Internet in pretty interesting ways.

8:16And at that point, I said, hey, I want to really look for a company that's starting to pave the path, pave the way of what's happening with the Internet. And at that point, the World Wide Web was still something that wasn't as prevalent as we use it every other minute today. But I moved over to Netscape Communications at a pretty early stage and was a bit more hands-on doing web development. But at that time at Netscape, I had my first interaction with working with partners. We were building a portal, sort of like Yahoo, like a search directory. And we didn't see opportunity to go build a bookstore, for example, which was a startup out of Bellevue at the time, Amazon, or Music Boulevard, who's no longer with us, or Travelocity and others.

9:00So I started working even at my day job as a web producer and developer to work with companies that were looking to bring services and we had an audience to bring to them. And I started to really see that, hey, working with others, solving this through technology could be pretty interesting. I then just sort of focused on product management and product for, I would say, the next five years or so, kind of honed my understanding of looking at it from a customer lens. And then moving into Yahoo is where really I pivoted into solely engaging with externally, but also having a very strong kind of connection with what are we trying to accomplish?

9:41What's the problem we're trying to solve for customers? And then the springboard to Netflix to where there was really, I think, a very clear inflection point that was occurring between, you know, if it's DVD by mail to stream and then also the ability, that really critical meeting that you were probably in, Jessica, where, you know, Reid was making a decision to work with others versus continuing to build a Netflix box. Yep. I remember it clearly. There you go. And folks can search that one and learn more about it. But that was a catalyst to say, how can you do this at scale to bring technology to folks' living rooms in a consistent and quality way?

10:22While, you know, the team in Beverly Hills and other areas were building content with Ted and others to just put more on the platform and have more selection. Yeah. The exposure of this comes in all shapes and sizes from partners and different cultures and sizes of companies and folks that have different experience. And so I started to see like, oh, wow, this is like, oh, my God, like a nest of I don't know how to codify this. How do I build a framework around this? It's not like when I was in web development or product management. Right. So it just kind of grew from there. I wanted to really focus on the area of where I could kind of connect what I believe I'm getting good at, what I love to do, what companies would actually want to use and leverage my skill set.

11:09Yeah, and I think, well, let's tell the listeners a little bit because I think what you helped us achieve at Netflix was pretty special. And we were at this inflection point and we were building a Netflix box and we thought everybody was going to get our box and stream, you know, TV shows and movies. And then we quickly realized it wasn't about being on one box. It was about being on every device possible, right? And getting people to have access to us, like wherever they had content, right? Right. And it was the transformation was. And I think our realization of that was key. Right. Because imagine if we had built the box.

11:50Right. And we were we were building it. I was hiring people to to make the device in China. Right. And it was quickly like, don't do that anymore. But but talk to us a little bit about that story, because I think it's a fascinating story. Oh, goodness. Oh, Jessica, you were at the epicenter of this. I think in terms of sort of like the core competency, you know, it's one of the things I talk about in the book, which we'll get to later, is, you know, kind of core versus context. And I think I learned a lot from Reed. I was very fortunate to have the quarterly connect points for the walks and the advice and inspiration from him.

12:26But I think the core aspect of saying, hey, what are we going to focus on as a company? Where are we going to differentiate and build this durability of our value versus where we believe, hey, this is context, meaning not saying it's not important. But, you know, there are experts in, you know, various industries that focus on that as a business. They've optimized costs. I think, you know, some of the challenges in building your own device out of the gate is you've got to build a device. You know, you've got to figure out the right bill of materials costs and you've got to figure out how to market it.

12:55and you got to figure out how to distribute it and, you know, et cetera, et cetera. And there's much more established brands on the planet that do that. They have existing retail relationships and e-commerce relationships, distribution. And I think there was a core kind of decision there to say like, hey, where do we want to focus on as a company, Netflix? And Reed made a, at that point, it was probably a hard decision to make because, of course, the team's involved and et cetera. But I think, you know, kind of looking back on it, it was definitely the right approach. And it's been a really, I would say, an example that is looked at across not just video streaming, but also many other industries of software as a service to kind of hardware as a platform for distribution.

13:40And so then it was. So, yeah, I think, Jessica, that that was a very hard decision, but it took the leadership and it was a very hard decision to make. I'm sure at that time involved people as a very heavy component. And then it was how do we do it? Yeah. Yeah. So tell us how we did it. Yeah. I mean, you know, the part of it is to understand, hey, what's already in living rooms? You know, how do folks actually connecting? And at that point in time, you know, not every device that was in a living room had an internet connection. They may have an empty, you know, Ethernet port on the back of a television or a Blu-ray player, but it was mostly used for a firmware update.

14:19And so is it really something that you can, not many devices even had Wi-Fi? Hard to believe. Yeah, there was no HD or 4K sticks out there. And that was the thing that came a little bit later while I was at Netflix. But at the time, it was gaming consoles, you know, that were probably the most advanced, you know, with the Xbox PlayStation, being able to connect for, you know, for multiplayer gaming, that was kind of breaking down the walls of connecting across a network and with other players. And so that was the most robust, also technical platforms that were able to handle the compute required, as well as the, you know, not just the storage on the device, but the ability for enough memory, etc.

14:59that can handle an application like Netflix. At that point in time, too, we were having companies ship us devices. We had a team that was doing the integrations. And, you know, it was very hands on. And you helped build that team was, you know, you do the integration, you get it to a certain level of quality. But that was where the turning point was. not only in saying, hey, we should partner with the device ecosystem, but also to develop a motion and program and a set of technology assets that allow partners to integrate it, but allow us to provide, at the end of the day, our goal is that quality of service and experience that we can ensure are brought to our end customers that are using Netflix.

15:38So it was really the shift that is difficult in partner programs or to develop a partner program is to say, hey, do we understand the product well enough? Do we understand what partner needs are and capabilities are well enough before you turn it into a program? If you start a program from day one, it's actually, it's probably bound to fail because you really don't know the mechanics and what you're solving for. But if you first try it yourself, and we probably didn't intentionally try it that way, but we did it ourself out of need and necessity. And then we said, we got to help the scale. Is there a way we could build a kit?

16:12Is there a way we could build a portal for partners to engage? Is there a team we should build that understands culture and language and others? And that set the bit to create the Netflix Partner Program, which was brought to really the device ecosystem. And we prioritized based on how we can have the most reach to the most customers and access to it based on the content availability. So there was a kind of a bit of a triangulation on Where do we bring these? What kind of engagements do we work with and which companies? But at that time, too, we were hopping on planes and meeting with companies across the planet, you know, concentration in Asia.

16:51Yeah, you guys were all over the world. We were all over the world, right? And you walk in a meeting, Jessica, like in Tokyo or, you know, Seoul, and they've never heard of Netflix. Yeah, never. And so because Netflix DVD by mail wasn't there, streaming wasn't there yet. And so we were also a bit of the translator of, hey, what's happening with video streaming? Why do you need an internet connection on your living room device? So it was a very early stage to demonstrate, collaborate with these companies. We were the first to do it. We were. I mean, it was brilliant. it was very and it was a collective kind of wisdom from some incredible variety of folks inside of netflix that i think you hired and the team patty had brought together that there wasn't like and greg and yeah oh my god like yeah nowadays you could say oh i want to hire a team to do this oh let me go to netflix let me go to hulu let me go to amazon prime at that time it was like oh oh, wait, maybe do I need to find people that have done, I don't know, Linux platforms on devices?

18:06Do I need to? It was like this company, Divix, was it? Divix, yeah. I think Bill came from there. Yeah, Bill came from there. And then MediaBolic, I think that was like where Greg was. Yeah. Oh, that's right. That's right. Yeah. Yeah. And they were kind of putting stuff on devices. And I was like, okay, that'll work. and I think that was you know finding partners that were willing to innovate with us and try new things and and then also the Xbox was a really big one that was like when we got that breakthrough breakthrough yeah and so really a mixture of product a mixture of partnership a mixture of technology it was really the stars aligned and then it really took off I don't know it's just I kind of got goosebumps thinking about that because it was just like I don't know like like I don't even really remember if I, you know, like I was just like making it up, like literally, but making it thoughtfully.

19:02But it was so fun. That was such a fun time. It was so fun. Exactly. I mean, when I look back on it, it was we were defining, you know, you kind of use the metaphor of building the plane as you're flying it. Like we didn't even say that. We were just we were on the plane and we were. Yeah. We were building this service, and at the same time, Ted and the content team was building, I remember when House of Cards was launched. So there was also this other aspect of really content being kind of crossing regions and cultural boundaries, which was also super breakthrough because it had been very siloed.

19:41I know. It's kind of crazy that we were part of all that. So you have this incredible experience, like, not only from Wired, where you started, but then you, you know, you're Yahoo, you go to Netflix, and then, you know, now you're where you are. But what sort of pushed you to write a book? And while you're working, which I think is super hard. You know, after Netflix, well, I decided to go join our friend Ayn McKendrick. Yeah. And I think Bethany was there at the time, too, you know, at a at a scrappy startup. And I hadn't rolled up my sleeves and been part of a very early stage company. And so it was definitely I felt at that point a very risky move, although probably looking at the outside in, it was probably, you know, not too risky because I had the support system and, you know, there's other opportunities.

20:41But it felt risky because it was leaving an amazing company. I think for me to learn and the ups and downs in a startup, there were days where I'm like, why am I here? There are other days saying, hey, I'm here because I have to learn and I'm going to stick through it. No matter what happens, I'm going to have a story to tell about it. And that's what I did. I took it all the way through. And ultimately, we created an amazing product partnership with one of our investors that ultimately did bring us, folded us into their company. And I worked for Seagate Communications or Seagate at that time where we were a scrappy startup inside of a pretty established company.

21:18And that was a whole other learning experience of how to do that effectively. After that, I kind of hit my arc there and, you know, was there for a little over five years. And then I decided to take a swing at the venture capital ecosystem. And so I joined Andreessen Horowitz, you know, over on Sand Hill. And it was a bit of, never heard of him. That Mark Andreessen guy. But it was, you know, kind of reconnecting with Mark too, you know, from the Netscape days, which was very cool. Yeah, yeah, yeah. And Ben Horowitz, who was leading LoudCloud. He was also part of Netscape back in the day. You know, one of the worst meetings I have ever had in my life was with Ben Horowitz.

22:01Yeah, what? I think he's probably, I don't know. He's probably the only person in the world that I didn't connect with. I connect with pretty much everybody, right? Maybe that day. I don't know. No, well, they had me talking to one of their portfolio companies, and he was on the board. And they really wanted me to go to the company, and I was still at Netflix. And Hammy come in and meet him, and he's in this really big office, like huge office, right? And it's like, I don't know. I'm sitting at his desk, and we start chit-chatting. And then all of a sudden this lady walks in the room and she sits in the very back corner and she just starts typing.

22:45And I was like, and he's like, oh, don't worry about her. She's just going to record everything you say. And I was like, oh, I was like, okay. Now we have AI for that one. Right. I was like, okay. And then he and I got into this like conversation about how it would structure compensation for a company. and he didn't like how I would do it. And we had a pretty special philosophy about it at Netflix, which was pay market, right? And if you want the best, you got to pay the best. And we were talking about that. And he was like, no, you can't do that. And I said, well, you asked me how I would think about it, and that's how I would think about it.

23:27And so we just kind of got into this. I don't know. Maybe he didn't hate me, but I don't think he liked me. and we never met again yeah I mean a lot of folks will seek confirmation you know like of maybe and maybe early stage super early stage would be different you know what I mean like yeah it worked it worked at Netflix extremely well I would say you know so that's what I was trying to explain to him it's not to say that you have to do it exactly this way but I feel like if we make it simple if we you know anyways it didn't resonate and he's gotten it right a few times too right he obviously has for sure obviously but it's it's just funny that you mentioned so you go you go to this yeah andreason horowitz yeah i go to andreason horowitz and it's it's a role that i'm kind of like again feeling like a leap i'm kind of like figuring out is this a is this an area i want to expand in do i want to just go try and you go back to like an operational role but at that time it was very compelling because i had started to think about just from the variety of roles I've had and the kind of engagements for BD and partnerships, the way the role was explained to me and the way that I just built on it over time was how do we engage with a portfolio of companies, a very diverse set of companies, B2C, B2B, B2B2C, all different business models, and accelerate their growth through creating more value for them or doing it in a faster period of time, a lot of different value of creating partnerships and who do you do it with and how do you do it at scale?

25:06And I thought that was a fascinating opportunity. And I joined the team to lead the consumer portfolio for A16Z, as they're known, 16 letters in between A and Z. Yep. That's the formula. That's the formula. Yeah. And then coming up with a way to codify, how do you look at 400 companies and determine where to focus time and effort and impact on. And so I took that, there wasn't really a structure around that. It was very much a reactive kind of model or an advisory model where maybe a general partner who sits on the board of a company would say, hey, this company needs a contact. Do you know anybody at Netflix?

25:48And it's like, okay, that's a connect role, not super valuable, but okay, maybe that could be done through an email. But I looked at it a little bit differently because being an operator, it's like at the end of the day, you want to figure out how to grow companies. And what we did at Netflix, I mean, that was the extreme depth of what you could build. How could you do that for a company like OfferUp? Do it for Lyft, do it for Pinterest. These are all pre-IPO companies at the time. And so I took it on to say, well, how do you come up with kind of first off a matrix and framework of stage? Let's put these companies in stages.

26:22Do we, Hey, anyone in the company know every consumer company and what stage they're at? What attributes do we have about these companies? Okay, stage. You know, in terms of ARR2, you know, what kind of revenue are they generating? When are they planning to go IPO? Are we trying to, what about the talent they have? Do they have BDM partnerships? Do they not? Are they looking to, is there an inflection point that they're looking to go create new, go into a new market? Do they want to go, meaning go after new customers or go after a new region or country? And so I started to build a rationale around what stage would be appropriate for me to engage with the CEO of a company and to approach them to first understand what's their kind of North Star of what they're trying to achieve.

27:09What's their kind of the BHAG of, you know, OfferUp or Pinterest, or we can talk about a few of the companies more. But then to align with that CEO and see if there was that chemistry where an outsider, you know, of me coming in, not where I would be a mole from the general partner inside of the company, but really a partner to say, hey, I am here to help grow your company. And is it through partnership? If it's through partnership, let's identify the right contacts that we can then bring a proposal to them and identify the way we can engage and create, you know, the, if you want to call it the partnership strategy and product, and then the actual, you know, contract and then get a team to execute it.

27:47so it was finding like a framework that could make sense for the right companies and and then i you know built out a team there and we we had some great success of how to build out an operation and uh aligned very closely with the general partners because they sit on the boards of several companies to understand hey what's the does this make sense should we be spending our time here and you know your question about why the book and how did that come into the picture I think for me, a key decision point, or at least like light bulb for me, was when I was working with many of these early stage or later stage startups, there was also a very intelligent group of interns that were coming on board inside the firm.