“Hang on a second, let me just get my phone real quick,” Meg Whitman (MBA 1979) says midway through a conversation one Friday morning in May, darting out the door of a glass-walled conference room in Los Angeles. She gives the entirely plausible impression of a person who rarely gets to sit—or at least for very long. For the last 14 months she has been running circles around Hollywood, since signing on as employee number one of a startup called Quibi. After devoting the previous two decades to Silicon Valley’s Fortune 500 scene—first growing eBay from a staff of 30 people and a few computers into an $8 billion behemoth 10 years later, and most recently leading a massive turnaround at Hewlett-Packard—Whitman has left her beloved Bay Area for a stand-up desk in Hollywood’s media district. There she finds her phone and hotfoots it back to take a seat at the table.

Swiping around her apps, Whitman explains Quibi’s great gambit: by doing for short-form mobile media what HBO did for premium television, the company (whose name is shorthand for “quick bites”) will revolutionize the way we watch video on our phones. The idea was dreamed up by Jeffrey Katzenberg, the former head of DreamWorks Animation and Walt Disney Studios, who serves as chairman to Whitman’s CEO. She holds up her iPhone to demonstrate what this future that they envision might look like on a five-inch screen.

From the fish-eye perspective of a peephole camera, we see a man standing outside someone’s front door in the dark of evening. “I got a package here; just need a signature,” he says, straining for a look inside the house. Whitman tilts her phone 90 degrees, switching from landscape to portrait mode, which triggers a shift in perspective: Now we’re on the other side of that door. A young woman sits on the couch, clearly afraid. “Can you just leave it on the doorstep?” she pleads. Whitman flips back to landscape view to check on the creeper outside. He’s not going away.

The demo is the work of director Doug Liman, one of several filmmakers Whitman and Katzenberg consulted to reimagine how a film could be shot, edited, and rendered with a smartphone in mind. “The player knows whether you’re doing this or this,” she says, flipping between the two orientations. The technology to make this happen seamlessly is one that they’ve patented and among a half-dozen tech-based innovations they’re hoping will transform mobile storytelling.

At Quibi they call it “script-to-screen innovation.” But one might also call it an audaciously big bet on an unproven format in an ever-crowded market of streaming content. With an April 6, 2020, launch, Whitman and Katzenberg have 20 months and $1 billion to build the whole thing from scratch—from a full catalog of original content to a tech platform to watch it on and enough customers to make it a viable business. They’re not settling for half-measures. “If we have great content but we don’t have a differentiated experience, we fail,” she says. “And the reverse is true too.”

The urgency to get there first and get it right is always top of mind at Quibi, particularly since Whitman installed a countdown clock in a central spot of the open-plan office, just down the hall from her desk. On that morning in May, it blinks out an unambiguous warning: 326 days, 10 hours, 15 minutes, 56 seconds.

The story of how Whitman, one of only three women in history to lead two Fortune 500 companies, wound up back at the beginning of startup life is one that she and Katzenberg recite with the well-rehearsed routine of a married couple telling their engagement story for the umpteenth time.

Back in 2017, Whitman was six and a half years into the five-year term she had committed to the board at Hewlett-Packard. When she joined in 2011, the third CEO in as many years, the company had lost its edge. Whitman engineered a massive corporate split in an effort to return the tech giant to the forefront of the IT industry. By 2017, her work was largely done. On the Tuesday before Thanksgiving, perhaps envisioning a respite ahead, she announced her intention to step aside. Her phone rang the moment the news hit the wires.

Hello? It was Jeffrey Katzenberg, whom Whitman first met in 1989, when both were working at Disney. They developed a friendship over the years of overlapping board work and corporate partnerships.

“If I wasn’t the first person to call, I was darn close,” he says. “I asked her what she was going to do.”

“I told Jeffrey I was going to retire and think about what else to do,” Whitman says.

“And I said, ‘No, no, no,’” Katzenberg follows, teeing up the punchline. “I said, ‘What are you doing for dinner?’”

Katzenberg flew up from Los Angeles the next day. Over a three-hour dinner in Palo Alto, he pitched his idea to make Game of Thrones–quality programming for the mobile phone. To succeed, Katzenberg bargained that they would need to meld the best of Silicon Valley’s tech talent to reimagine the delivery with Hollywood’s creatives to make the sizzle. “I have half of that equation,” Katzenberg says. Although Whitman completed his picture, he figured there was no way she would pick up her life and move to Los Angeles to start over as an entrepreneur. “But that didn’t stop me from asking,” he says. “If you don’t swing at the ball, you can’t score. And if you don’t score, you can’t win.”

Whatever the odds, Whitman was intrigued. “So that was the catalyst of my not retiring and just hanging out,” Whitman says. Instead, in March 2018, she moved out of her home in the Bay Area, settled into a condo in Los Angeles, and set about the task of transforming this idea into a revolution.

There’s really no script for that, of course. It’s similar to the situation she found upon arrival at eBay in 1999, when people were just starting to speculate about the potential of the World Wide Web. There was definitely no roadmap for harnessing a disparate community of Beanie Baby collectors into a multinational Fortune 500 company. “We just had to figure it out to the best of our ability, and in the same sense there’s no playbook for this,” she says. No matter. In breaking new ground, without a map, Whitman is in her comfort zone.

Her first step at Quibi was to “put meat on the bones of the business plan,” she says: defining the content and tech strategies and figuring out how they could produce profitable numbers. Whitman worked alongside Ambereen Toubassy, who had brainstormed with Katzenberg as a partner at WndrCo, his holding company for media and tech investments. “The minute Meg came on board it went from being a vision to an executable business plan,” says Toubassy, who is now Quibi’s CFO.

From the outset, they theorized that the only way to create this new market was to build a huge library of content that was made specifically for mobile devices, and then pursue whatever marketing investments are necessary for people to sign on for a monthly plan of $4.99 (or $7.99 for the ad-free option). That’s in addition to the big-screen subscriptions for cable or any of the many streaming services, from Amazon to Hulu, that people are consuming in their evening hours—a market against which Whitman says they are not in direct competition.

The founders worked closely with the studios to build the business model, which no doubt eased the fundraising that followed. Almost a dozen major movie studios participated in the initial round of funding in the summer of 2018, including Disney, Entertainment One, Fox, ITV, Lionsgate, MGM, NBCUniversal, Sony, Viacom, and Warner Media. (Quibi has plans to raise another $500 million before launch.)

Many of those studios are now signing on as suppliers with a lucrative deal intended to help Quibi compete with a growing pack of streaming services on the prowl for content. Netflix, for one, has been acquiring content at a pace almost no one can match and reportedly spent $12 billion on content in 2018 alone. So Quibi chose a different route: “Everyone else in town, when they commission content, they own the IP. But we made the strategic decision not to compete with our suppliers,” Toubassy says. Instead Quibi pays the studios’ production costs up front, including a 20 percent premium on top. After a seven-year exclusive license, the content reverts back to the studio to use as they wish, giving the creators ownership of their IP.

“When HBS writes the case about Quibi, one of the things I’m sure they’ll talk about is this decision to not compete with our suppliers,” Toubassy says. “It means that the creators are super motivated to make the best possible content.”

The decision seems to be helping the company gain access to the A-list talent it needs to make good on its promise of premium entertainment. The Hollywood press is thick with ink about Quibi’s latest deals, such as Antoine Fuqua’s #Freerayshawn ,starring Stephan James and Laurence Fishburne. Oscar-winning director Guillermo del Toro (The Shape of Water), Jason Blum (Get Out), Lena Waithe (Master of None), and Sam Raimi (Spider-Man) have also signed on to headline “lighthouse” shows, with budgets of up to $100,000 a minute to produce. (The second season of Netflix’s Stranger Things cost about $130,000 a minute by comparison.) Just as Anna Kendrick’s Dummy was originally written as a film, these projects will be serialized in seven- to ten-minute morsels that a viewer could snack on, one at a time, or binge over two or three hours. These big-name and big-budget lighthouse shows sit at the top of the company’s content pyramid.

In the middle section, with budgets closer to $50,000 a minute, Quibi is building a tier of unscripted material—reality and game shows, documentaries, and the like—with a focus on programming that already has an existing fan base, as with reboots of Punk’d and Singled Out by MTV Studios. And down at the low-cost bottom of the pyramid, Quibi is hoping to build a daily habit out of essentials like sports, news, and weather. Like the carbs of the food pyramid, these nibbles cost little to produce, at $10,000 a minute, but keep viewers feeling full.

The big question, of course, is whether people will sign up. There are 2.7 billion smartphones in the world, Whitman points out, and people are spending more time on them than ever—and increasingly watching videos: We’ve gone from spending six minutes a day watching video in 2012 to 70 minutes a day in 2018, she says. Much of that is free content, from cat videos on YouTube to whatever the kids are doing on Snapchat. And while high-value, long-form streaming options are flooding the market, the upper-right quadrant in the two-by-two matrix of premium short-form content remains empty. For now. “We think the trends are absolutely right,” Whitman says. “But, listen, we won’t know until we know.”

So why does Whitman appear so unflappable? “I don’t think I feel risk the way most people do,” she says with a shrug. “I think it’s because of my mom.” Margaret Whitman was the sort of bold character who volunteered for the Red Cross during World War II and hopped on a ship bound for New Guinea. But instead of wrapping wounds in the infirmary, like her peers, Margaret emerged from the war as a fully certified truck and airplane mechanic. “She always encouraged us to do things and figure it out, and I think it’s enabled me to jump into the deep end of a swimming pool without actually being able to see how I’m going to get out,” Whitman says. “Most of the time it’s worked.”

There was that period, from 2009 to 2010, when she ran on the Republican ticket for governor of California and lost to Jerry Brown. (“It’s the only illogical thing she has ever done in her career,” Katzenberg, a Democrat, offers.) Even that bruising experience didn’t make her risk averse, she says. “It made me a better CEO. When you run for office, you really cannot care what people think about you, so I learned to be a lot tougher.”

Whatever you do, don’t try to call Quibi. Almost no one there has an office phone. If someone in creative has a question for an engineer, they march down the hall to ask. It was a deliberate decision to help the company’s cross-functional teams, which can speak slightly different dialects, develop a common language. Similarly, when the staff outgrew one floor of office space and expanded to a second, Whitman stationed herself on one floor, Katzenberg on another. “We walk up and down five times a day. But if we were both on the same floor, then everyone else could feel like second-class citizenry,” says Whitman, who famously tore down the barbed-wire fencing around Hewlett-Packard’s executive parking lot immediately upon her arrival there.

Whitman has cultivated a we’re-in-this-together sense of parity with intention, particularly in the hiring-intensive early months. It’s equal part culture choice and strategy: “I think most of the other entrants in this space were either media companies that tried to become tech companies, or tech companies that tried to become media companies,” she says. The hope is that building both from scratch at the same time will result in a one-plus-one-equals-ten-type equation, she says. “And that starts with a tight-knit relationship between Jeffrey and me.”

Their partnership is more yin and yang than peas in a pod. She’s a Northern California Republican. He’s the Los Angeles Democrat. “She’s quintessential right brain. I’m quintessential left brain,” Katzenberg adds. “That’s not to say she’s not creative or that I’m disorganized, but I’m always leaning left, and she is always leaning right. Some of that is our superpower.”

At least according to Quibi staff, who are admittedly high on early-stage optimism, there’s a sense that this dual leadership model powers their invincibility shield. “You’d be hard pressed to find another environment where the best creative thinkers in Hollywood are paired up with really sophisticated technology people in the very beginning, before the content has been created,” observes Chief Product Officer Tom Conrad, a former executive at Snap and CTO at Pandora. “It’s something that a lot of people talk about, but there are a bunch of circumstances here, starting with Meg and Jeffrey’s partnership, that make it a reality in a way that’s rare.”

Their connections sure help, for starters. Conrad tells the story about the day Steven Spielberg, a DreamWorks cofounder and one of Katzenberg’s longtime collaborators, came in to hear the pitch. “He seemed reasonably skeptical at the start,” Conrad says. But then, halfway through, Spielberg starts spinning ideas. He wants to make a horror anthology, the scariest stuff he’s ever done—and he wants it available only in the dark of night. “I look around the room, and the technology people can hardly contain themselves,” Conrad says, “because we know exactly where you are and when the sun sets, and we could unlock that content literally the second the sun dips below the horizon.”

The opportunity for that kind of blue-sky engineering has been a selling point for Conrad as he builds his team, including Head of Product Tricia Lee (MBA 2013). “We have people from Netflix, Google, Amazon, Snapchat, Starbucks, Nike, and Microsoft. There’s a lot of product management oomph there,” she says. And many of them, like Lee, who worked at Sony and Microsoft, left more traditional tech jobs for the chance to engineer a seismic change in the entertainment/tech space.

Similarly, Greg Gioia (MBA 2015) left Goldman Sachs for the chance to get close to the magic that Whitman and Katzenberg might make. He believes that Quibi, where he heads financial planning and analysis, may be one of the few companies in a position to pull off that level of disruption. “With the exception of Disney, which is disrupting itself, a lot of other companies in media and entertainment can’t invest fully in what the future might look like because they have a legacy business model that they need to protect. There’s no legacy that we’re beholden to, no business model that we have to pivot from. This whole bet is unique,” he says. “Yet I don’t think anyone here could promise this will be a home run.”

Nonetheless, Meg Whitman is putting all her chips on the table. Over her decades in Silicon Valley, she developed a checklist to evaluate successful consumer-tech businesses. First, she looks for existing trends and a big market. If the world’s 2.7 billion people with smartphones that they can’t put down are any indication, “that’s an absolute walk with Quibi,” she says. Second, is the customer behavior already there? Online purchases were a complete unknown when she joined eBay, never mind online auctions. “It’s a lot easier when there’s an established behavior,” she says. Third, is there an advantage here that would allow a company to stand out over the long term? “Because if we’re successful, there will be a lot of competition,” she says. And fourth, does the idea create value and allow you to do something that you couldn’t before? “I’ve seen most of the business plans in Silicon Valley over the last 20 years, and usually not all of these things are at work,” she says. “But this one checked all my boxes.”

And yet anything can happen in the blink of time between the bloom of an idea and its light-of-day launch. There’s a lot of work to be done, Whitman acknowledges, but she remains focused, unworried. She sleeps just fine at night. “Fundamentally the direction is clear,” she says, “but ultimately we really won’t know until we know. That’s what a startup is all about.”

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