Bob Iger is best known for being the former CEO of the Most Creative Company in the World - Disney
But very few know about how he MERGED Disney with Pixar.
This is the story of Bob Iger and HOW he managed to buy Pixar from Steve Jobs.
But very few know about how he MERGED Disney with Pixar.
This is the story of Bob Iger and HOW he managed to buy Pixar from Steve Jobs.
1/ But before diving into how Bob achieved the unachievable,
let's first have a look into why PIXAR even mattered.
For that we have to go further back into the history of PIXAR.
let's first have a look into why PIXAR even mattered.
For that we have to go further back into the history of PIXAR.
2/ Steve Jobs co-founded Apple, the most valuable company in the world.
But you might be surprised to learn that he was also involved in the creation of some of the most loved animated movies.
He co-founded one of the earliest animation studios, PIXAR.
But you might be surprised to learn that he was also involved in the creation of some of the most loved animated movies.
He co-founded one of the earliest animation studios, PIXAR.
3/ But wasn't he more interested in technology than movies?
Then why he started Pixar?
Starting Pixar was kind of an accident.
Then why he started Pixar?
Starting Pixar was kind of an accident.
4/ Jobs was fired from Apple in 1985.
He began exploring for new options that would be worth his time and money.
"NEXT Computers" was one of them.
Apple eventually acquired NEXT Computers.
But there was a 2nd company!
"Graphics Group".
He began exploring for new options that would be worth his time and money.
"NEXT Computers" was one of them.
Apple eventually acquired NEXT Computers.
But there was a 2nd company!
"Graphics Group".
5/ Graphics Group, was a section of Lucas Film's computer division,
which assisted in the creation of special effects for movies such as Star Wars.
However, once those projects were completed, George Lucas no longer required the technology.
which assisted in the creation of special effects for movies such as Star Wars.
However, once those projects were completed, George Lucas no longer required the technology.
6/ In 1986, less than a year after Steve Jobs left Apple,
George Lucas placed the Graphics Group up for sale.
Jobs saw the potential of the 3D technology,
but not in the way you might think.
George Lucas placed the Graphics Group up for sale.
Jobs saw the potential of the 3D technology,
but not in the way you might think.
7/ Graphics Group had only 40 employees.
Jobs merely expected them to keep doing what they were doing,
i.e. creating devices to improve computer-generated graphics that other movies might buy.
Jobs paid $10 million for Graphics Group and renamed it to PIXAR.
Jobs merely expected them to keep doing what they were doing,
i.e. creating devices to improve computer-generated graphics that other movies might buy.
Jobs paid $10 million for Graphics Group and renamed it to PIXAR.
8/ PIXAR's sole purpose at that time was to develop, "Pixar Image Computer",
An advanced computer that could generate high resolution 3d images.
An advanced computer that could generate high resolution 3d images.
9/ At that time Disney wasn't Interested in 3D technology.
Disney's artists feared being replaced by a computer.
Steve Jobs marketed the "Pixar Computer" for medical imaging and meteorology.
However, the $135,000 price tag slowed sales.
Disney's artists feared being replaced by a computer.
Steve Jobs marketed the "Pixar Computer" for medical imaging and meteorology.
However, the $135,000 price tag slowed sales.
10/ Jobs found himself in a difficult spot.
NEXT and Pixar were both costing him tens of millions of dollars to run.
They were not making any money for him.
NEXT and Pixar were both costing him tens of millions of dollars to run.
They were not making any money for him.
11/ But then luck stricked.
John Lasseter, who was one of the co-founders of PIXAR worked on creating the below short films.
- Luxo Jr which earned an academy nomination for best animated short, and
- Tin Toy, which became the first animated short film to win an Oscar.
John Lasseter, who was one of the co-founders of PIXAR worked on creating the below short films.
- Luxo Jr which earned an academy nomination for best animated short, and
- Tin Toy, which became the first animated short film to win an Oscar.
12/ This was the cue.
Jobs realized that he didn't have to sell 3D technology to other companies.
PIXAR could create it's own movies.
Jobs needed a distribution partner,
and the name that came to mind was...
DISNEY!!!
Jobs realized that he didn't have to sell 3D technology to other companies.
PIXAR could create it's own movies.
Jobs needed a distribution partner,
and the name that came to mind was...
DISNEY!!!
13/ Previously, Disney had no interest in using 3D animation in movies.
Jobs convinced Disney on the idea that Disney might safely test the 3D concept and gauge public reaction through Pixar before incorporating it into their own movies.
Disney was in.
Jobs convinced Disney on the idea that Disney might safely test the 3D concept and gauge public reaction through Pixar before incorporating it into their own movies.
Disney was in.
14/ Jobs made the most important deal in the history of animated movies.
He negotiated a $26 million contract with Disney to produce Pixar's first 3 feature length movies.
1 - Toy Story 1
2 - A Bug's Life
3 - Toy Story 2
He negotiated a $26 million contract with Disney to produce Pixar's first 3 feature length movies.
1 - Toy Story 1
2 - A Bug's Life
3 - Toy Story 2
15/ Toy Story 1 ended up making $30 million in its opening weekend alone and eventually $365 million globally.
Pixar's IPO was successful. The stock was in high demand.
The company had finally achieved profitability.
But there was a little problem.
Pixar's IPO was successful. The stock was in high demand.
The company had finally achieved profitability.
But there was a little problem.
16/ Pixar was losing out on all the licensing revenue, due to their deal with Disney.
Jobs renegotiated.
A new contract was proposed, that split the cost and profits equally between Disney and PIXAR.
Jobs renegotiated.
A new contract was proposed, that split the cost and profits equally between Disney and PIXAR.
17/ Disney CEO, Michael Eisner, didn't agree to the new contract.
This made Jobs to publicly announce that the two companies would be ending their partnership.
Years went by.
This made Jobs to publicly announce that the two companies would be ending their partnership.
Years went by.
18/ Things were going good for PIXAR.
Movies like:
-Finding Nemo (2003), and
-The Incredibles (2004)
were released with huge success.
Movies like:
-Finding Nemo (2003), and
-The Incredibles (2004)
were released with huge success.
19/ Things were not looking good for Disney.
A whole array of challenges nearly derailed it's a long train of success.
Having released a number of flops to box office, Disney was struggling to stay ahead of the competition.
A whole array of challenges nearly derailed it's a long train of success.
Having released a number of flops to box office, Disney was struggling to stay ahead of the competition.
20/ In came Bob Iger.
He replaced Michael Eisner as the new CEO of Disney in the year 2005.
PIXAR which was now a rival was quickly streaming ahead, locking horns with the Disney in the process.
He replaced Michael Eisner as the new CEO of Disney in the year 2005.
PIXAR which was now a rival was quickly streaming ahead, locking horns with the Disney in the process.
21/ In an interview Oprah Winfrey he said,
βI knew that my first priority in becoming CEO was to turn Disney Animation around. I also knew that if I didnβt do that, my tenure as CEO was likely to be short-lived.β
βI knew that my first priority in becoming CEO was to turn Disney Animation around. I also knew that if I didnβt do that, my tenure as CEO was likely to be short-lived.β
22/ After becoming the CEO, Bob immediately began his search.
He started looking for a talented team that could save Disney Movies.
Soon he realized that team didnβt exist in house.
He started looking for a talented team that could save Disney Movies.
Soon he realized that team didnβt exist in house.
23/ He was disappointed.
"When it comes to animation, who is doing it best?" he asked himself.
The answer was PIXAR.
"When it comes to animation, who is doing it best?" he asked himself.
The answer was PIXAR.
24/ 2nd day on the job as the CEO he made a proposal to Disney's board of directors.
"What if, rather than trying to fix Disneyβs animation division from within, the company straight up bought the best animation studio in the business?"
"What if, rather than trying to fix Disneyβs animation division from within, the company straight up bought the best animation studio in the business?"
25/ "That way, Disney could rally behind Pixar's growing star, and the men in charge of Pixar at the time
-John Lasseter and
-Ed Catmull,
could manage Walt Disney Feature Animation moving forward".
-John Lasseter and
-Ed Catmull,
could manage Walt Disney Feature Animation moving forward".
26/ The board was shocked.
Buying PIXAR meant dealing with Steve Jobs, the companyβs CEO and controlling shareholder at that time.
Due to a very public clash with, Michael Eisner, Disney's then CEO,
things were still tensed with Steve Jobs.
Buying PIXAR meant dealing with Steve Jobs, the companyβs CEO and controlling shareholder at that time.
Due to a very public clash with, Michael Eisner, Disney's then CEO,
things were still tensed with Steve Jobs.
27/ Disney's board feared that the invincible Jobs would gain too much control over Disney.
Bob saw things differently though.
And this is where we get to see Bob Iger's exceptional Leadership skills.
Bob saw things differently though.
And this is where we get to see Bob Iger's exceptional Leadership skills.
28/ As a true Servant Leader, he humbled himself infront of the Disney's board members and said,
βIf Steve Jobs could exert influence over Disney, even if it meant him ultimately running Disney, that would be great for the Disney shareholders.β
βIf Steve Jobs could exert influence over Disney, even if it meant him ultimately running Disney, that would be great for the Disney shareholders.β
29/ Bob's Servant Leadership way of thinking demonstrated that,
aggressive corporate leadership isn't about self-promotion and power.
It is about detaching yourself from the company, to be able to examine problems as objectively as possible.
Bob got the nod.
aggressive corporate leadership isn't about self-promotion and power.
It is about detaching yourself from the company, to be able to examine problems as objectively as possible.
Bob got the nod.
30/ It was now time to face Steve Jobs.
Bob knew he could never win the "number" battle with Steve Jobs.
When the opponent is strong, then the only way to summon COURAGE is through VULNERABILITY.
Bob knew he could never win the "number" battle with Steve Jobs.
When the opponent is strong, then the only way to summon COURAGE is through VULNERABILITY.
31/ In the interview with Oprah Winfrey he said,
"I called him up, I was actually quite nervous. After all he was Steve Jobs. That guy changed the world".
"I called him up, I was actually quite nervous. After all he was Steve Jobs. That guy changed the world".
32/ The Courage the Bob gained through Vulnerability inspired him to be:
-Candid
-Honest, and
-Authentic
when speaking to Jobs.
-Candid
-Honest, and
-Authentic
when speaking to Jobs.
33/ He knew that Jobs was driven by his Vision.
A vision to make a difference.
So he started by saying,
"I have this crazy idea and I would like to discuss that idea with you".
This hooked Jobs.
He then pitched Jobs the idea.
A vision to make a difference.
So he started by saying,
"I have this crazy idea and I would like to discuss that idea with you".
This hooked Jobs.
He then pitched Jobs the idea.
34/ Jobs was interested
So he invited Bob to Apple headquarters.
There the two men sketched the whiteboard with lists of pros and cons.
So he invited Bob to Apple headquarters.
There the two men sketched the whiteboard with lists of pros and cons.
35/ Jobs feared that Disney,
would damage Pixar's work culture of absolute respect,
for the creative process, and
devotion to generating radically innovative story ideas.
would damage Pixar's work culture of absolute respect,
for the creative process, and
devotion to generating radically innovative story ideas.
36/ This con was heavy enough to outweigh all pros.
Bob promised to carefully preserve Pixar's truly harmonious connection between its left brain tech side and the right brain artistic side.
Bob promised to carefully preserve Pixar's truly harmonious connection between its left brain tech side and the right brain artistic side.
37/ So he made certain that Pixar's great storytellers stayed on after the acquisition.
Bob assured Jobs that Pixar's work culture would remain intact.
This reassurance ultimately SEALED THE DEAL.
Bob assured Jobs that Pixar's work culture would remain intact.
This reassurance ultimately SEALED THE DEAL.
38/ Leadership Lesson Learned:
When it comes to business transactions, one of the most important values is efficiency.
And being genuine is the go-to method for closing agreements as fast as possible.
When it comes to business transactions, one of the most important values is efficiency.
And being genuine is the go-to method for closing agreements as fast as possible.
39/ When Bob initially approached Steve Jobs about acquiring Pixar, he was open about his desire to purchase the firm.
Not only that, but he explained why Disney needed to do so.
His candor eased the negotiation, allowing for more real and efficient bargaining.
Not only that, but he explained why Disney needed to do so.
His candor eased the negotiation, allowing for more real and efficient bargaining.
40/ This is HOW Bob Iger convinced the mighty Steve Jobs to sell PIXAR.
The benefits of this deal continue to accumulate for The Walt Disney Company, its shareholders, as well as for Bob himself.
The benefits of this deal continue to accumulate for The Walt Disney Company, its shareholders, as well as for Bob himself.
41/ If you enjoyed reading it then consider Following me @VibhorChandel for more threads on:
-Leadership Tips, Tricks & Mysteries
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And Subscribe to my YouTube Channel youtube.com/vibhorchandel
-Leadership Tips, Tricks & Mysteries
-Communication Hacks
-Building High Performing Agile Teams.
And Subscribe to my YouTube Channel youtube.com/vibhorchandel
42/ You Can find my last thread on "The Ultimate HACK to GET HEARD in MEETINGS", here
https://twitter.com/VibhorChandel/status/1493579237806288899
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