The Idea
In 2007, Anthony Wood had already founded and exited five companies, and he was quietly building his sixth. Roku means six in Japanese, and Wood, a Texas A&M electrical engineer who had invented the digital video recorder and sold ReplayTV to SONICblue for roughly $121 million, had spent years circling one conviction: the television itself needed an operating system.
He had been pestering Netflix co-founder Reed Hastings for months, asking to build a box that streamed Netflix straight to the living room. Hastings wanted to keep it in-house, on a secret project codenamed Griffin. So the two cut an odd deal. Wood took a part-time role inside Netflix to build the device while staying CEO of Roku, then a fifteen-person startup.
Then Netflix lost its nerve. Shipping its own hardware would turn every other manufacturer into a rival. So Hastings handed Wood the entire project, wrote a $6 million cheque, and let him walk out the door with it. Privately, he expected it to fail.
This was the beginning of [Roku](https://en.wikipedia.org/wiki/Roku,_Inc.).
The Execution
- 2002: Wood founded Roku in San Jose, self-funding it with proceeds from the ReplayTV sale and pitching it as a maker of high-definition video players. It was the sixth company he had started.
- May 2008: Roku shipped its first device, the DVP N1000, built to stream Netflix's new Watch Now service. Netflix invested $6 million, but Hastings later admitted he didn't think Roku had much of a chance against Xbox, PlayStation and Apple TV.
- 2008 to 2016: Wood flipped the model. Roku sold hardware at near cost to grab living rooms, then made its money on advertising and content distribution. By its IPO year, advertising made up around two-thirds of platform revenue.
- 28 September 2017: Roku went public on Nasdaq at $14 a share, raising about $252 million. The stock jumped 67% on day one to close at $23.50.
- 27 July 2021: Riding the pandemic streaming boom, Roku hit an all-time high of $490.76, up more than 3,000% from its IPO price in under four years.
- 2022 to 2023: The boom snapped. Advertisers froze spending, growth stalled and rising rates crushed the valuation. The stock fell to around $64, roughly 87% off its peak.
- 2025: Roku reached more than 100 million global streaming households, over half of all US broadband homes, with The Roku Channel ranking fifth in US streaming viewership behind YouTube, Netflix, Disney and Prime Video.
- 15 June 2026: Fox agreed to buy Roku for $160 a share, valuing it at roughly $22 billion. The cash-and-stock deal hands existing Fox shareholders about 73% of the combined company, puts Anthony Wood on the Fox board, and is expected to close in the first half of 2027.
The lesson?
The best founders don't always invent the category. Sometimes they win by owning the boring layer everyone else overlooks. Hastings gave Wood a hardware side project he expected to flop, because Netflix saw hardware as a distraction. Wood saw the operating system that would sit between viewers and everything they watched. Twenty-four years and one 87% drawdown later, Fox paid $22 billion for exactly that. The consolation prize turned out to be the whole living room.