What if you bought Blockbuster in 2000?
US Consumer · Media. The hindsight answer, year by year, against the only benchmark that matters.
Could you have picked it? Play0× · S&P 500 same money: $4,626
Every dollar is gone. Blockbuster went bankrupt in 2010, so $1,000 invested in any of these years is worth exactly nothing today.
The story
Blockbuster was the king of video rental, with thousands of stores and a business heavily reliant on late fees. Owned by Viacom since 1994, it was partly floated in 1999 and fully spun off in 2004. Around 2000 its leaders reportedly turned down a chance to buy a small DVD-by-mail startup called Netflix for about 50 million dollars, an anecdote that has since become business-school folklore.
Blockbuster did respond, eventually. It launched an online service in 2004 and dropped late fees in 2005, which cost it a big chunk of profits. Activist Carl Icahn won board seats and fought with CEO John Antioco, who left in 2007. His successor pulled back from online, betting on stores just as Redbox kiosks undercut rentals at a dollar a night and Netflix shifted to streaming. Blockbuster carried heavy debt and lost money year after year. It filed for bankruptcy in September 2010, and Dish Network bought what was left in 2011. A single franchise store in Bend, Oregon, lives on as a tourist attraction.
The lesson: Incumbents rarely miss disruption entirely; they lose because reacting means sacrificing profits today, and half-measures get punished from both directions.
$1,000 invested at the start of each year
| Bought in | Price then | Worth today | S&P 500 would be | Multiple |
|---|---|---|---|---|
| 2000 | $12.00 | $0 | $4,626 | — |
| 2003 | $12.00 | $0 | $7,727 | — |
| 2005 | $9.00 | $0 | $5,763 | — |
| 2007 | $5.00 | $0 | $4,789 | — |
| 2008 | $3.50 | $0 | $4,626 | — |
| 2010 | $0.4 | $0 | $6,071 | — |
green = beat the S&P 500 · red = lost money
There was no good entry point: every starting year ends at zero. The same $1,000 in the S&P 500 from 2000 would be $4,626 today.
Now try it without hindsight. The wheel decides the year and the asset class, you pick the position, ten seconds a pick, and we simulate to today. Blockbuster is one of 258 positions on the wheel — including the ones that went to zero.
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