THR’s Philanthropist of the Year Reed Hastings on Why “It’s Much Easier to Disrupt Entertainment Than Public Education”

Early on in Reed Hastings’ tenure as a board member of the KIPP Foundation, which runs a nationwide network of charter schools designed to help underserved communities thrive, they were faced with a key challenge. In 2011, they received statistics on the college completion rates of their students, and while they were comparable to the national average (33 percent vs. 32 percent, according to KIPP co-founder Dave Levin), they were a bit underwhelming ­— particularly considering the national debate on whether charters can deliver on their lofty goal of improving kids’ educational futures more than their traditional counterparts.

Within the board, questions arose on whether they should make the information public. Then Hastings gave his input. As Levin recalls, Hastings advised that “whether it’s good or bad news, let’s share with everyone, and share what the changes are that we are going to make.’’ The board did just that, pivoting to a program that supports its alumni as they attend college, and completion scores rose (in New York City, KIPP says it’s now 46 percent).

That kind of transparency has come to define Hastings, who as co-founder and co-CEO of Netflix has championed radical transparency and analytical thought to turn the company from a DVD service into a Hollywood behemoth. It’s also how he approached the streamer’s recent downturn, telling staffers bluntly in a town hall, “It’s a bitch,” while embracing an ad-supported option, one the company had long resisted, to lure more subscribers.

Hastings likes to keep his philanthropy separate from his day job. During our hourlong interview in May — the end result of negotiations that began months ago, and confirmed well before Netflix stock tumbled following a loss of 200,000 subscribers, leading to layoffs and other financial tightening — as we talked at Netflix’s Los Angeles office, he at times would gently resist attempts to connect the two, while making clear that his vision for giving was not one he would ever push at Netflix: “I have this classic view, which is, Netflix money is not my money.”

But, of course, it’s the spoils of Netflix — Forbes puts Hastings’ net worth at $2.5 billion — that have allowed the co-CEO and his wife, Patty Quillin, an exec producer on several documentaries, to give as generously as they have over the past two decades. Besides his involvement with KIPP (Knowledge Is Power Program), which includes a 17-year stint (still ongoing) on its board, the couple’s biggest public donation created national headlines in 2020 when they gave $120 million to HBCUs after the police murder of George Floyd.

United Negro College Fund president Michael Lomax, a longtime friend who met Hastings while both sat on the KIPP board, said the donation was initially going to be $60 million — still a staggering sum for UNCF and its other benefactors, Morehouse and Spelman colleges — when he got a call 36 hours after that initial pledge. “They said, ‘We’ve been talking to Black Lives Matter donors and they said that if you write a check and your hand doesn’t sweat, it’s not the right check, so we decided to give Morehouse $40 million, Spelman $40 million and UNCF $40 million,’ ” Lomax recalls. “I almost started crying. I was so blown away.”

Hastings’ philanthropy has been almost singularly focused on education: It’s a cause he’s been involved with since he taught math in the Peace Corps in Eswatini after college, and later as a high school teacher. Twenty years ago, he helped get a California law passed for local school bonds, and was an appointee to the State Board of Education until his “missteps,” as he calls them, in communicating issues surrounding bilingualism led to him not being reappointed. “It taught me that politics is hard,” he says of the experience.

Through giving, Hastings has been able to direct his own causes, though recipients of his largesse say he stands out from other philanthropists in that he lets them decide what to do with the dollars he gives them.

Anushka Ratnayake, the founder of myAgro, which uses mobile layaway for seeds and fertilizer to help empower impoverished farmers around the globe, says: “He really respects me and the team to make the decisions that we need to make.” After Hastings gave a private donation, it was Ratnayake who directed the funds toward hiring key support positions. “Being able to hire great talent and hire them early is going to accelerate our work to our ambition of reaching 1 million farmers over the next five years,” she adds.

Lomax echoes the idea that Hastings is a “different kind of philanthropist. If everyone was as generous and as open to letting us make decisions about how to make the most impact, we would be very thankful, because very often donors say, ‘This is exactly what I want you to do,’ ” he explains. “And I think he has trust and confidence in the institutions that he supports.”

So, $120 million to UNCF and HBCUs — what were your initial feelings about how you wanted this money to be used, and what was the long-term impact you hoped to see?

I went to a PWI [predominantly white institution] in northern Maine, Bowdoin College. Really small, really white. I’ve been funding for many years there a first-generation-at-college program, pretty typical stuff, and I was telling Michael Lomax about it. And I was proud, like, “Oh, I’m doing this. I’m part of the good guys.”

We know each other well enough. [He] was like, “That’s great, but that’s what’s perpetuating the capital isolation in our country, which is, you went to this PWI, you do really well. That’s great, you give back to the thing you know. It’s human nature. But it continues the capital segregation in our society.”

And because we work on the KIPP board, which is providing more opportunity to almost all kids of color, we’ve talked a lot about the legacy of racism of 250 years, where it’s illegal to read and the multigenerational effects, Jim Crow, and this kind of thing. I think he’s been good for me, for dispelling the idea that Martin Luther King Jr., integration, civil rights, that we fixed all that. That now it’s a level playing field. You see this most starkly with capital. [According to the Brookings Institution, in 2019, the median white household had $188,200 in wealth compared to $24,100 for a Black household.]

That perpetuates in terms of, how much debt do you need for college? And so probably five years ago, maybe three years before George Floyd, he took us down to Spelman and Morehouse, and he’s a Morehouse grad. But for Patty and me, it was great getting to know the leaders there in the schools. I had had the view that HBCUs were a historic relic.

Why did you feel that way?

Because they were a legacy of segregation — that we had to have Black colleges and universities because the white schools didn’t let them in. With integration, the goal was having lots of Black graduates of Princeton, Stanford. And that is a good thing, and that is happening.

But we didn’t have any proximity with the HBCUs to realize that the cultural affirmation of being around so much Black excellence seems to have a really transformative effect on students — even though they’re going to enter a predominantly white work world. … [A student] could just be a smart person, and not have to be a Black smart person, as they felt when they, or their friends were, at PWIs.

HBCUs produce [the majority] of Black lawyers and doctors in America … an incredible percentage from a small number of schools. They’ve been amazingly effective at developing the Black middle class. None of that I realized. They were a really big impact, as opposed to the only dream being integration, the traditional dream of my generation.

It was very impressive, and we became mid-level donors. Post-George Floyd, Patty and I wanted to do something much bigger, and this was an obvious one and a big one to do. And when you ask, “Why did we focus it on scholarship?” It’s to lessen student debt.

What were some of the conversations that you were having with people at Netflix or within your peer group that also spurred this decision?

George Floyd was impactful at many levels, I think because his murder was, A, by the police, B, in a liberal place. If it had happened in Alabama, you’d be like, “Oh my gosh, the South again.” But it’s in Minneapolis. From a white perspective, it shook me and my peers up about the level of violence and the level of multi-institutional violence.

At the time, people were giving money to BLM, the NAACP and so forth. What made you focus specifically on the educational part?

For 40 years, I’ve developed connection and significance with education — I was a high school math teacher — as opposed to many other good fields: economic opportunity, health care, voting rights. But it’s just been my connection for a long time.

I read something where you said, instead of donating to a lot of different areas, you prefer to focus on one.

Journalists and management consultants, they get addicted to stimulation, lots of variation. Operational people get addicted to focus. The only way as an operations executive to make progress is to say no to lots of things and really focus. I would say my personality has always been like a dog with a bone, you just never let go. You dig into an area, whether that’s direct-to-consumer entertainment or education, and you just work it and work it and work it. As operations executives, we systematically learn to eliminate distraction and figure out what’s the core. That’s the same for me in philanthropy, where most of my time is on education. When I talk to other emerging philanthropists, my big advice is, find an area or two where you really get good at it.

Let’s go back to your first big donation. Walk me through what that was like.

Aspire Public Schools, 1998. It was a million dollars, which back then was a big deal for me, to help them buy a campus to open a new school. And they have grown into 30 schools in California, very successful. But this was their first one, when they didn’t have a track record.

Some people donate in a way where it’s like, “This is my money and this is what I want you to do with it.” How did you get to your no-strings-attached philosophy?

You know how the Netflix culture is about freedom and responsibility?

Right.

That’s the philosophy here, too. For me, in philanthropy, it’s investing in organizations, but they definitely run it. I’m at the very low-control end of that spectrum — consistent with the business philosophy of finding the right people, and then backing them.

At Netflix, you have control, and with the places that you donate to, you don’t. You can do your research, but if things go sour, they go sour. Is that hard?

No, that’s not hard. At Netflix, what we say is, “Context, not control,” in our culture memo. It’s a philosophy, generally. It’s been a consistent part of my philosophy to be supportive, be an evangelist. And then, whether it’s the Dave Levins or the Anushkas, it’s backing them to do great work. I’m not giving Anushka advice about what kind of peanut seed to use. I learned a lot about the different seed trials, and that’s exciting and fun, but it’s really cheerleading and making them feel like they’ve got a big backer to help them in their daily challenges.

We talked about the impact of lessening student debt, but long-term, these are huge donations to HBCUs. What kind of parity do you envision, and what are your expectations?

You’re gracious to call them huge, and in some sense they are, but another sense, the gap is huge: Bowdoin [has more than a] billion-dollar endowment. And [HBCU] Tougaloo, where I was recently [he and his wife gave $10 million in February], the endowment’s $50 million. And they’re almost as old as Bowdoin — they were founded in 1869. The donation is 10 kids every year get a free ride. It’s like, 10 kids a year is a beginning and that’s great, but that doesn’t nearly address the deficit that we have.

How has that influenced your view of your culture here at Netflix, and the communities of color here, as far as learning from them and how they navigate Netflix?

I would say that a lot earlier than George Floyd, partially through the charter school work, I’ve been aware of the employment gaps. We’ve been one of the leaders on a DEI basis for a decade in terms of the employment experience across race, gender, LGBTQ. I don’t think that the HBCU insights and donation have really changed how I operate at Netflix or how we work. We had been working long before that on recruiting diverse talent in all dimensions.

How do you react to the criticism that some of the recent layoffs have hit people of color particularly hard and what that says about commitment to diversity?

I would say, every year and every quarter, we publish our numbers — which is where you really see the commitment — and they’re very strong. An approximate example: We’re at like 10.7 percent of the U.S. employee base being Black. What’s amazing is that at leadership, the numbers are even slightly better [10.9 percent, according to Netflix]. That’s on our website, it’s public data. And so we continue to hold ourselves accountable to be a leader in diversity.

You’ve also approached education politically. What were some of the frustrations that you had to deal with when you were president of California’s State Board of Education, and some of the lessons as they may apply to philanthropy?

The big lesson I learned is that most of the people who work in public schools are fantastic human beings, fully committed to trying to get kids to flourish. It gave me a lot of humility and understanding of the life that superintendents, school boards, unions are struggling with. I’ve always worked well with school unions. We did a ballot initiative together in California in 2000, 2002, to make it easier to pass local school bonds.

Then later when I made some political missteps, the unions came and testified on my behalf. But being on the State Board of Education is a political appointment, and your job is to help the system, in this case, with testing and curriculum, and not run into political trouble.

I was president of the board for a number of years, but then I tripped over the bilingual school issue. We instituted a rule that half of the time, kindergarten had to be English, half could be Spanish, but at least half in English, to get kids more fluent more quickly. I didn’t do it very well, and this was seen as an attack on Hispanic kids and Hispanic culture, which was unintentional, but it’s politics.

What did that moment teach you as far as your messaging for what you support?

It taught me that politics is hard. The people who are really good at it are extremely disciplined and careful. I would’ve preferred to stay in it. But you learn a lot by working in the system. In the tension between the revolutionaries and the evolutionaries, I’m the evolutionary. I’m like, “We got the system we got, let’s figure out how to evolve it toward being better.”

It’s interesting that you call yourself an evolutionary, because Netflix and you have been perceived as revolutionary. So why not, “Let’s blow this system up”?

It’s a great question. It’s turned out to be much easier to disrupt entertainment in the commercial world, and to have this battle with Blockbuster, and to be competing with Disney and HBO, than it is to be in a large governmental system like public education. That, inherently, is slower. And that’s what our founders designed it to be. Checks and balances. It’s working as it was designed to, the public education system, which is to slowly adapt to changing situations. That’s all of government, not just public education.

Over the years, there have been grand donations in education — Mark Zuckerberg’s $100 million donation to Newark, New Jersey, public schools — which didn’t hit the mark. What does it take for philanthropy to be transformative?

In philanthropy, there are very few one-time easy fixes. It’s really about grinding it out, steady, improving opportunity year by year. KIPP has grown from one school to [270] over 20 years — 15, 20 schools a year, every year. Trying to make them all a little bit better. The lesson is, you’ve got to be persistent, unrelenting, and then you can build up to make a difference. The one-time contributions, whether that’s me with HBCUs or other big ones, are well intentioned, but they’re not going to be transformative.

Why is that?

If you look at the practice of journalism or law, it’s pretty similar to a hundred years ago. And teaching is the same. OK? Some people say, “Well, society with Netflix is all different, entertainment’s all different. Why aren’t schools totally different?” But if you look at arguing in the Supreme Court, the court system, it’s largely the same as a hundred years ago. It’s designed to be a stable institution.

I think of your question with philanthropy, and it depends on: Is there a technology lever? In some fields, maybe a fantastic energy source, better nuclear efficiency, better batteries, better solar — that would have a really transformative impact. As opposed to, let’s everybody try to save 5 percent by turning our lights off. That has a very slow impact.

In education, we haven’t found a technology solution that’s magic. Duolingo’s cool. It’s great. But technology so far hasn’t transformed learning in the way that vaccines or therapeutics have changed medicine.

What are some of the things that you’ve learned from your peers, other moguls in the tech and entertainment industries, as far as philanthropy?

I was on the board of Microsoft for a long time, so I got to know Bill Gates, which I otherwise wouldn’t have had a chance to do. We spent a lot of time talking about philanthropy for him, the lessons out of it. His main one was building a great staff. It makes a huge difference at his foundation, his and [ex-wife] Melinda’s, that they have these great vaccine people, great polio people. In each of the areas that they’re in deep, they really curate incredible expertise. And so that really has stuck with me. And so the people that I rely on have a lot of expertise in their field. So the advice was building up a network of experts that you can learn from.

What have been the most rewarding experiences when making donations?

There are two kinds of rewards. There’s intellectual reward, which is the percentage of kids learning at grade level moving up from 32 percent to 36 percent. You might be like, “Wow. That gets you excited? It’s pretty dry.” But that’s long-term operating improvement. And now we’ve got New Orleans performing at the Louisiana state level, which, coming from where New Orleans was 25 years ago, is a huge accomplishment. That’s the intellectual part.

Then I would say on what’s personally satisfying, it’s meeting with teachers and principals at different schools. When I’m with the principals who are grinding it out every day, working for their kids’ benefit, I feel like, “Oh my God, I want to donate more. This is such a heroic person, how can I support their work more?” Or when I was with Anushka. She’s been living in Senegal for 10 years now, and built this great team of really good agriculture people and good community people. She’s dedicating her life to it. It makes me very moved and wanting to be a bigger supporter.

At Netflix, do you try to encourage staffers to donate, or share what you’ve learned about philanthropy?

I have this classic view, which is, Netflix money is not my money. … The company’s owned by shareholders. It’s not my money to give away in ways that I like. Instead, we give it to employees, to shareholders, and then they get to decide what they do with the money.

All my philanthropy is personal and I don’t have Netflix get involved in African agriculture, HBCUs, charter schools, all those things. I don’t try to direct the philanthropy. And some people do a lot of philanthropy, others might be supporting three relatives, where it doesn’t count as philanthropy, but it’s very generous. And of course Netflix has a corporate donation matching program: If they put $5,000 into something, we put $10,000 [Netflix matches twice an employee’s donation to eligible charities, up to $20,000].

I don’t think the world’s better when companies are picking causes of various sorts. Mostly, I admire people who keep those two worlds separate.

It’s interesting when you say that you don’t feel companies should do that. Because in this age, some companies are using their profile for philanthropy, for political causes, especially with what’s going on with gun control and abortion. Do you see Netflix becoming more vocal or using that power to effect change in that way?

In my philanthropy, I really try to keep that separate, so I don’t expect Netflix to weigh in on charter schools. And there are big battles around that, political battles. It doesn’t seem fair to make the company do that when some employees probably like charter schools, some don’t, some are probably pro gun control, some are probably pro Second Amendment. We want to be inclusive at Netflix across not only race and gender and sexual orientation, but also around political views. It should be very comfortable to work at Netflix, and you should have an ability to thrive. We want people to be generous and to be great members of their community, but we don’t want to dictate which causes they support.

Earlier, you talked about the traditional dream of your generation. Do you feel like that dream is, in this day and age, still possible?

Absolutely. But I think the legacy of slavery and Jim Crow is way bigger and deeper than most people realize. It’s such an unfair mapping onto other immigrant groups — Poles, Italians, Latinos — that don’t come with all of the overhang from slavery. In white society, and certainly in my upbringing, we don’t understand that for 400 years, roughly 1450 to 1850, exploiting Black bodies was incredibly profitable. And imagine normal society treating Black people as animals. It was very profitable to do that, branding them, locking them up, but you couldn’t do that unless there was a morality that Black people were subhuman. Otherwise, how could you justify it morally? So all through Europe, it developed the idea that Black people were subhuman and thus slavery was morally acceptable and highly profitable. That didn’t suddenly end with the Civil War. There’s this theology and belief system that’s taken a long time to break through. I think that’s why Black excellence at HBCUs makes such a difference, because it’s changing psychology. Kenya Barris talks about that in #blackAF. He’s like, “It’s still all about slavery,” which is almost a spoof, and yet he’s telling a deep truth. I think that understanding of slavery’s impact is not well taught, at least, in white circles.

Nowadays, there’s certainly pressure not to teach.

Yeah, CRT [critical race theory] stuff. A whole blowback on that.

You say that you don’t use Netflix for philanthropy, but content obviously affects culture so much. How do you want it to shape the world that we live in?

It’s a great question. Mostly we want content to be super entertaining, really grab you and like, “I can’t wait to watch more of it,” as opposed to being preachy. The essence is, again, great storytelling. But are we leading-edge on diversity and casting? Look at Bridgerton. So, yes. But we must do that through an entertaining lens or it doesn’t get watched.

That would bring me to Netflix’s responsibility with recent comedy specials from Dave Chappelle going into the world. Because some people feel that’s very damaging. How do you feel about how that affects the world?

Different people, especially around the world, have different views about what’s acceptable onscreen. We have the view that we want to back and create a vision where we don’t want to censor content. But we want to give consumers the right warnings and awareness and information so they can choose for themselves what they want to watch. And so that content breadth — not everybody thinks that is a good way to operate. That’s why we’re trying to be so public in choosing to back content breadth, and it will include things like, some of the content that we have in the Middle East is the same content in India, Poland and Argentina, in parts of the U.S. It’s very controversial.

I’m curious about the feedback that you received from the latest culture memo as far as: This might not be the place for you, if some of that content offends you.

Well, some of the content’s going to offend everybody.

True.

OK. It’s really that either you can love the fact that we have content breadth, even if you don’t like particular titles, or you can’t. It really is, “We’re committed to content breadth. And if you’re not comfortable with that, you might not love it.” And that’s the truth. We’re just trying to be honest, just like we are about team, not family, in the culture memo. It’s not fair to people to join and they think it’s one thing and it turns out to be another. We see it as being clear about what we’re about, so people who love content breadth and creative expression, they will love being here, because we’re very committed to that.

Is this a point in Netflix’s trajectory where you feel like you need to make a sharp change, or is this just a bump?

We have evolved a lot from DVD, toward licensing. We’re in constant evolution. This isn’t that unusual, when you look back over the last 25 years. And it’s the same thing in philanthropy, for me, of making new changes and learnings. We talked about HBCUs. That’s really only been a focus in the past five years, so the first 20 it was not. Or the agricultural work. Whether it’s Netflix or my own philanthropy evolving, it’s constant learning and evolution.

How do you see your philanthropy work evolving?

Well, I hope it grows. To get that to grow, we’ve got to get Netflix to be more valuable again. It’s a nice synergy because I find the philanthropy rewarding and satisfying, but I find Netflix exciting. When I jump up in the morning, I’m checking the metrics: How are we doing in Thailand, how are we doing in Australia? And I just love competing. And the fact that now [Warner Bros.] Discovery is strong and Disney is strong and Amazon and Apple are — it’s so exciting. That’s my thirst for competing. And that’s what gets me excited about trying to get our stock back to where it was, or bigger, and then I can write bigger checks on my philanthropy.

I’m sure the recipients would love that. I’m curious as to what your thoughts are about how the town has reacted — there’s a lot of smugness — to recent Netflix stumbles.

It has nothing to do with consumers. We really focus on, “How are customers going to love Stranger Things launching this week?” If you get caught up in what your competitors think, it’s just distracting.

You talked about spending members’ money wisely. How do you plan on doing that? Do you feel the days of bigger spending are going away, such as with creator deals, that people in Hollywood are taking a closer look?

A little bit. The overall market is pretty hot, still, for new content deals, because you’ve got Apple and Amazon raising their budgets, and you’ve got all the existing players combining, obviously, Disney, Fox, Discovery, Warner Bros. People are realizing that streaming is the future, and all of linear TV is going to become streaming. And that’s a big shake-up. Until Disney committed to that, maybe four years ago, that was still tentative. Linear TV’s still doing well. And then, since Disney moved over, everyone has been scrambling to figure out and get their share of [streaming].

As far as the big deals that you have with the Ryan Murphys of the world, do you see those continuing?

Yeah. Well, like Shonda Rhimes with Bridgerton has been a huge success, and Inventing Anna. Just think of how different they are, and she excels at both of them. She’s got an incredible storytelling aesthetic. It’s like, I don’t want to bid up the price, but she’s a genius.

What excites you about Netflix now?

Competing and winning. I desperately want us to pull way ahead of Disney and Discovery. They’re great companies and they’re doing great entertainment, but I want ours to be better, and for people to choose to spend their Wednesday night with Netflix rather than with those guys. Or, for that matter, TikTok. TikTok is a huge and growing competitor.

Right. And what do you think are the biggest things that you need to do to make that happen? Gaming? Live streaming?

All of those are important, but at its core, it’s attracting the best creators, giving them a platform for excellence, and then helping them craft amazing stories that engage people. And then, we were born on the internet, we’re focused on it, so our advantage is, we’re very focused on the service DNA, whereas our competitors are also trying to do linear TV and theatrical and theme parks, and we’re like, “No, it’s really about the service.”

Interview edited for length and clarity.

This story first appeared in the June 22 issue of The Hollywood Reporter magazine. Click here to subscribe.