Speaker 1: Welcome to Business on the Brink, a production from I
Speaker 1: Heart Radio and How Stuff Works. Pixar's origin story plays
Speaker 1: out like, well, like a Pixar movie, full of ups
Speaker 1: and downs, drama, and a few unexpected allies. This company
Speaker 1: has overcome more than a few brink moments, from lamps
Speaker 1: to apples to infinity and beyond. We're going to tell
Speaker 1: you all the animated details of this company's evolution. This
Speaker 1: is Pixar on Business on the Brink. Hey everybody, I'm
Speaker 1: Jonathan Strickland and I'm Ariel Casting. And this is a
Speaker 1: suggestion from Nathan in St. Louis. Thank you Nathan for
Speaker 1: writing in. It was great to hear from you, and
Speaker 1: it's a great suggestion. St. Louis. St. Louis fair enough St.
Speaker 1: Louise from good old St. Lou So, Yeah, we're gonna
Speaker 1: talk about Pixar, which is I love this topic. It's uh,
Speaker 1: it's one of those studios that has produced a remarkable
Speaker 1: number of amazing films when you look at like the
Speaker 1: percentage of all the films made and plus some other
Speaker 1: films that aren't so amazing. Dinosaur, Oh my gosh, we
Speaker 1: didn't even plan that guy. But I've I've seen it.
Speaker 1: I have not. It's that's why I haven't seen it.
Speaker 1: So it's not it's not bad, it's just it's just
Speaker 1: not remarkable. That's see. That's the thing is that Pixar
Speaker 1: set the bar very high with some of their movies,
Speaker 1: and so when things are just good instead of great,
Speaker 1: you're like, well, that's a disappointment when it when for
Speaker 1: any other studio it would be considered a hit. So
Speaker 1: but we're gonna talk more about the founding of Pixar
Speaker 1: and how it was never a sure thing that it
Speaker 1: was going to become the movie studio that it is. Say,
Speaker 1: it didn't even really start as a well, it kind
Speaker 1: of started as a studio and it became not a studio,
Speaker 1: and then it became a studio again. So yeah, let's
Speaker 1: get into that. So the story starts not with John Lassen,
Speaker 1: who I think a lot of people associated with picks.
Speaker 1: It doesn't start with Steve Jobs or even George Lucas,
Speaker 1: who would become one of the key members of Pixar.
Speaker 1: It actually really starts with a guy named Edwin E.
Speaker 1: Cat Mill, and cat Mill had dreams of working for
Speaker 1: Disney as an animator, but he had one major issue,
Speaker 1: which is that he really just couldn't get down the
Speaker 1: artistic talent for hand drawn animation. Yeah, that's that's kind
Speaker 1: of a necessity when you want to be an hand
Speaker 1: drawn animator. Yeah. So, and he went into computer science.
Speaker 1: He really threw himself into it. He got like advanced degrees,
Speaker 1: not just a bachelor's, he got a master's and a PhD. Smart, yeah,
Speaker 1: super smart. And he went to grad school and in
Speaker 1: grad school in nineteen seventy two he would actually get
Speaker 1: the nod to designing a computer animated graphic for a
Speaker 1: feature film. And it's a film of a of a
Speaker 1: movie you've seen. You've seen West World, right, Yeah, and
Speaker 1: I've seen the movie that you're talking about, Future World. Yeah.
Speaker 1: Future World is the sequel to a film called Westworld.
Speaker 1: The film, Yeah, there was a film before the TV
Speaker 1: show guys. Yes, this is the film that inspired the
Speaker 1: HBO series. So back in the seventies, we may do
Speaker 1: with you, ol Brenner as a robot writing around and
Speaker 1: being terrified. I don't know if make do is the
Speaker 1: right word to put with you, old Brunner, but it
Speaker 1: depends on the movie. I guess he was great in
Speaker 1: West World. So Future World was the sequel to West World,
Speaker 1: and it had this computer and animation sequence in it.
Speaker 1: It actually was Captain Moll's hand. He animated his own
Speaker 1: hand into it, and this was the first time that
Speaker 1: computer animation would be used in a feature film. Then
Speaker 1: he graduated with his PhD and he got contacted by
Speaker 1: the New York Institute of Technology to go over there
Speaker 1: and to serve as the director of a computer graphics
Speaker 1: lab brand New. Yeah, and and that's where he met
Speaker 1: his cohorts for the eventual Pixar. Yes, the alv Ray
Speaker 1: Smith is one of those, in fact the probably the
Speaker 1: most important of the ones, who also had a PhD
Speaker 1: in computer science. He had uh was he's a little
Speaker 1: bit older than Catmill, but he had also worked at
Speaker 1: xerox is Park Research Center. Park is the p A
Speaker 1: r C. That's the same research center where stuff like
Speaker 1: the first graphic user interface, the first computer mouse, like
Speaker 1: all that kind of stuff grew out of there. Although
Speaker 1: to be fair, the computer mouse actually came from somewhere
Speaker 1: outside of Park but got adopted. You get where I'm going.
Speaker 1: That's funny because Steve Jobs will them into our story
Speaker 1: later here, and Steve Jobs in Park have a tenuous history, yes,
Speaker 1: because Steve Jobs got to tour Park and then stole everything. Yeah. Yeah,
Speaker 1: I think we talked about that a little bit in
Speaker 1: our Zerox episode. I think he also met David Di
Speaker 1: Francesco and Ralph Guggenheim there. Yes, both of them would
Speaker 1: become founding members of Pixar as well. So they all
Speaker 1: are working at this this computer graphics lab together when
Speaker 1: a a certain independent filmmaker came knocking at the door.
Speaker 1: That independent filmmaker was George Lucas. Yes, he said, I
Speaker 1: am your employer, Yeah he was. He was putting together
Speaker 1: a little, little little special effects studio called Industrial Light
Speaker 1: and Magic. Just a little studio, yeah, right right up
Speaker 1: there with Wetta. You know, there's one of the big
Speaker 1: ones out there. And so George Lucas being George Lucas,
Speaker 1: he wanted to get the best people in the world
Speaker 1: to work on this. And computer effects were like new, Yeah,
Speaker 1: they were like unheard of. So he was going for
Speaker 1: the cutting edge, the bleeding edge of that technology. And
Speaker 1: he recruited Cat Moll to come in and head up
Speaker 1: the computer division of Industrial Light and Magic. And Cat
Speaker 1: will being you know, familiar with the work of his
Speaker 1: colleagues reached out and essentially plucked them all up to
Speaker 1: be part of this group, thus gutting the computer graphics
Speaker 1: division over it. Yeah yeah, no, but smart move on
Speaker 1: on George Lucas's part, and smart move on Cat Moll's part. Yep.
Speaker 1: So their original work was mostly to make computer animation
Speaker 1: not like computer animation, which is understandable, like you're trying
Speaker 1: to make it. We see that today too, to say
Speaker 1: it's something that we still struggle with. You know, I
Speaker 1: think when you said he originally animated his hand, Yeah,
Speaker 1: like I've dabbled in drawing hands of the hardest part
Speaker 1: for me on two D animation. So, but I think
Speaker 1: on three D animation to actually melts away and hair
Speaker 1: and hare's another big one. Yeah, it's and eyes too, right,
Speaker 1: like you look at something like Polar Express, which is
Speaker 1: not a Pixar film and who you can just get
Speaker 1: those dead eyes. Okay. So they're trying to make their
Speaker 1: computer animation not look like what it was, yeah, which
Speaker 1: is again like you see action movies that have like
Speaker 1: the the c g I blood spray if someone gets
Speaker 1: shot and it's always incredibly obvious. They wanted to try
Speaker 1: and create new stuff, and so they also had to
Speaker 1: do things like figure out, well, how do we work
Speaker 1: around the fact that computer animation is super clean, right,
Speaker 1: Like it's all virtual. It's not a real camera you're using,
Speaker 1: but real cameras when you're shooting on film, if you
Speaker 1: move the camera, you get blur, right, because cameras are
Speaker 1: just taking a series of photographs super fast. So they
Speaker 1: actually one of the things I had to figure out
Speaker 1: was how do we make blur in the computer graphics
Speaker 1: effects so that it looks like it's actually they're on
Speaker 1: film as opposed to an effect you just eat a
Speaker 1: greasy burrito and then you wipe your finger across the screen. That's,
Speaker 1: oddly enough, exactly not what they did. So they're working
Speaker 1: on this stuff and there really isn't much for us
Speaker 1: to comment on other than they were they had steady
Speaker 1: work in industrial line, okay, so let's get ahead to then. Sure,
Speaker 1: that's when cat Moll would hire on a contract worker,
Speaker 1: so not full time yet. This guy was named John Lastener,
Speaker 1: still his name, John Lsener, who had previously worked as
Speaker 1: an animator for Disney, so exactly what kat Moll wanted
Speaker 1: to do. Yep. And the thing that Lastener had encountered,
Speaker 1: at least according to most stories, is that he wanted
Speaker 1: to introduce computer animation to Disney features but just encountered
Speaker 1: a lot of resistance. So he was eager to try
Speaker 1: those skills somewhere else, and he thought the Industrial line
Speaker 1: Magic would be the place to do it. Yeah, and
Speaker 1: he did by he was a full time employee, and
Speaker 1: he had the title of interface designer. Yeah, because they
Speaker 1: didn't technically have an animator position, so that was the
Speaker 1: closest that they could come up with. They would work
Speaker 1: on several big motion pictures, including one called Young Sherlock Holmes,
Speaker 1: which have you seen. I haven't seen, but I did
Speaker 1: look up the scene that you're about to talk about,
Speaker 1: where uh they took a two dimensional night I think
Speaker 1: from a stained glass window and made him like pop
Speaker 1: into the scene and and interact with somebody. And it's
Speaker 1: it's interesting because they definitely got the look of like
Speaker 1: going through stained glass. But it's pretty row. Yeah, it's
Speaker 1: it's a rough one. It also makes me think of
Speaker 1: the animated the c g I intro to Steven Spielberg's
Speaker 1: television series Amazing Stories. It was very similar. But yeah,
Speaker 1: this was the idea and Young Sherlock Holmes is that
Speaker 1: it's a hallucination. The bad guys have these hallucinogenic darts,
Speaker 1: and when they shoot you with one, you have these
Speaker 1: nightmarish hallucinations that then compel you to commit suicide. Spoiler
Speaker 1: alert if you haven't seen Young Jill movies, like four
Speaker 1: years old, I think we're outside of the spoiler alert rules.
Speaker 1: But anyway, this was the first time they had a
Speaker 1: scene where live action actors and a c g I
Speaker 1: character would be interacting in the same frame. So that
Speaker 1: was that was a new benchmark. Yeah, and to do that,
Speaker 1: they needed special hardware to do it. Yeah, they didn't
Speaker 1: have like, yeah, no one had built a computer system
Speaker 1: for that. So they're like, well, I guess we'll build
Speaker 1: our own dan dang darn computer system. And they called
Speaker 1: it the Pixar Image Computer. Yes, now this is a Yeah,
Speaker 1: this is before they had given a name to the division.
Speaker 1: They were still just part of Industrial Line Magic and um, yeah.
Speaker 1: The funny thing is, I'm not going to go into specs.
Speaker 1: Anyone who knows me from texting you knows I could.
Speaker 1: But technically, if you have a smartphone, then you have
Speaker 1: a you have a computer more powerful than this thing
Speaker 1: was back in its day. But for its time, it
Speaker 1: was an incredibly sophisticated computer. Yeah. But then they used
Speaker 1: it for more than just entertainment special effects. Yeah. Well,
Speaker 1: they figured that in order to get the best return
Speaker 1: on investment, they could actually market this computer system for
Speaker 1: lots of other stuff, including like medical imaging. So the
Speaker 1: idea was, why should we build this computer system, which
Speaker 1: will be very expensive, and just use it in house
Speaker 1: if we could also market it as its own product
Speaker 1: and make more money by selling it to other, you know, organizations.
Speaker 1: So they started. It's almost like they were side hustling
Speaker 1: as a hardware company, not just as an effects division
Speaker 1: within Industrial Line Magic. They're they're kind of making extra bets.
Speaker 1: They're hedging their bets. Yeah. And one of their big
Speaker 1: early customers for the Pixar Image computer was Disney. Yep,
Speaker 1: they are looking at use such a thing, not to
Speaker 1: create three D c g I films, No, No, to
Speaker 1: digitize their cell animation. And I'm trying so hard not
Speaker 1: to go into this tirade about Disney three D animation
Speaker 1: versus two because I like the Pixar Disney movies, but
Speaker 1: I really missed the Tudi animation. Well, and there was, Yeah,
Speaker 1: there was a thing time at Disney. This is outside
Speaker 1: the realm of our discussion, really, but there was a
Speaker 1: time at Disney where the prevailing wisdom early on in
Speaker 1: the Pixar years was that, oh, the audiences love these
Speaker 1: movies because they are computer animated movies. And even lasseter
Speaker 1: as As, the man who was really heading up that
Speaker 1: effort at the time, said, knew, what's most important is story. Story,
Speaker 1: and then you know, you determine how you're going to
Speaker 1: tell that story. But story is way more important than
Speaker 1: whether it's hand drawn or computer animated. Yeah, okay, tie
Speaker 1: right off. The system they made for Disney was called
Speaker 1: the Computer Animation Production System, nicknamed CAPS, and uh they
Speaker 1: actually would still be working on that when the division
Speaker 1: would split off from Lucas Film. So why did this
Speaker 1: division of Industrial Light and Magic get spun off, Well,
Speaker 1: it's because Lucas was having some issues. So but but
Speaker 1: I mean, he just did Star Wars. Star Wars was
Speaker 1: super successful. He did Return of the Jedi and eighty three,
Speaker 1: so he had just had three blockbuster films he had made.
Speaker 1: I think I think the right term is a metric
Speaker 1: crap ton of money, very scientific, Jonathan, not just not
Speaker 1: just off the films, but through merchandizing. That was I mean,
Speaker 1: that was one of the biggest money makers that Lucas
Speaker 1: stumbled on. That really wasn't as big a thing until
Speaker 1: the Star Wars franchise came around. And so this is
Speaker 1: a point where you know, you would think everything's going
Speaker 1: on great, but Lucas also was kind of looking for
Speaker 1: the next next project. Yeah, he didn't have another Star
Speaker 1: Wars film. No, so he made an amazing movie called
Speaker 1: Howard The I knew you would. I knew you would.
Speaker 1: I knew this. Look, it's not a good movie. It's
Speaker 1: a horrible movie, but it's an amazing movie. I saw
Speaker 1: it in the theater when it came out. It's so
Speaker 1: bad it's good disturbing, which is frequent from that film.
Speaker 1: Um Leah Thompson's in it, though she's very cute in
Speaker 1: that movie. But no, the it's a it's a terrible movie.
Speaker 1: And then it bombed. It absolutely bombs. So Lucas had
Speaker 1: just had a flop of a film come out. He
Speaker 1: was also going through a an acrimonious divorce that was
Speaker 1: incredibly expensive. In fact, there's talk about the reason why
Speaker 1: Indian and Jones in the Temple of Doom was so dark.
Speaker 1: It was partly because Lucas was working out his feelings
Speaker 1: about his divorce. Yeah, but it made a really good movie.
Speaker 1: Okay movie. And then he so he's he was in
Speaker 1: a bad place and he was thinking, well, I don't
Speaker 1: have another Star Wars lined up. Howard the Duck was
Speaker 1: a total ust. I think I'm going to focus on independent,
Speaker 1: smaller films. Uh. And so he decided he was going
Speaker 1: to sell off this computer division of Industrial Light and Magic.
Speaker 1: So this was a possible point where this whole thing
Speaker 1: could have just gone away. Yeah, but thankfully capt Moll
Speaker 1: was kind of already preparing for this spinoff. Yes, he
Speaker 1: knew that this was coming, and so he had already
Speaker 1: started to kind of set the foundation. And Uh, they
Speaker 1: decided that they were going to create their own standalone company,
Speaker 1: Computer Animation and Effects Company. Uh. They did have one
Speaker 1: little problem, which is that no one was really keen
Speaker 1: on what to name it. Like, there were a lot
Speaker 1: of no one No one had the one idea that
Speaker 1: everyone immediately glommed onto. So there was a lot of
Speaker 1: disagreement on that. Yeah, apparently one of the names was
Speaker 1: gif fix, yeah, g f X for graphics. Yeah, it
Speaker 1: was just this. It was just a temporary name. Is
Speaker 1: literally something that they had to put in to a
Speaker 1: field on a forum. They forgot the R to they
Speaker 1: were well and there are a lot of issues with
Speaker 1: that particular acronym doesn't make any sense. So they ultimately
Speaker 1: obviously decided that they would name their company after the
Speaker 1: computer system they had designed. That's why they called it Pixar.
Speaker 1: And then they just needed to get somebody to help
Speaker 1: fund this because they couldn't they didn't have any money
Speaker 1: when they're just getting spun off. They had to find
Speaker 1: some sort of angel investor, and they knew just the
Speaker 1: guy who could get the jobs done. I don't know
Speaker 1: whether they're grown or do you like at Dune done done?
Speaker 1: Tell you what, how about we take a break and
Speaker 1: you can figure it out. So obviously I was referring
Speaker 1: to a very specific person with that angel investor, and
Speaker 1: that would be Steve Jobs. And he paid five million
Speaker 1: dollars to George A Kiss four Pixar. Yeah, and then
Speaker 1: he spent another five million dollars to help fund the
Speaker 1: company to get it really situated. Uh. At this time,
Speaker 1: Jobs was actually going through his own transition. This was
Speaker 1: during the period where he had been effectively forced out
Speaker 1: of Apple or he had quit, depending on who you ask. Yeah,
Speaker 1: and uh. And so he had gone on to found
Speaker 1: a different company called Next and he decided to to
Speaker 1: swoop in and generally he was going to be hands off.
Speaker 1: He was going to leave the running of the company
Speaker 1: to cat Moll and to Smith. They were going to
Speaker 1: keep going. But he did have majority steak in the company. Yeah, absolutely,
Speaker 1: he owned seventy percent of the shares is a private company,
Speaker 1: not publicly traded, but seventy of the shares of the company,
Speaker 1: and then the Pixar employees owned the other thirty percent.
Speaker 1: That will be important later in our episode. Yeah. He
Speaker 1: also decided that he wanted to really that Picks are
Speaker 1: up to be a computer hardware company, so all of
Speaker 1: that imaging stuff they were looking at unless the animation
Speaker 1: studio side, and we all know how that went eventually. Yeah.
Speaker 1: So this was this was largely a practical kind of determination,
Speaker 1: the idea that computer animation was not quite at the
Speaker 1: level of sophistication where you could make, say a feature
Speaker 1: link film that you had people like Lasseter who wanted
Speaker 1: to do it. There were a lot of people at
Speaker 1: Pixar who wanted to do it, but they had all
Speaker 1: determined that as the technology stood at that moment, it
Speaker 1: just wasn't really possible. Yeah, but I mean they didn't
Speaker 1: give up animation entirely. Lester still made shorts which were
Speaker 1: then used as um kind of just like a sales pitch. Yeah,
Speaker 1: like a sales pitch system exactly. They said, well, yeah,
Speaker 1: you want to know what's possible with this computer, here's
Speaker 1: some animation that we designed using this computer. So it's
Speaker 1: kind of like a demo. But you know, obviously Laster
Speaker 1: being Laster, he wasn't gonna just do you know, a
Speaker 1: bouncing ball or something that would play a part of it,
Speaker 1: especially in the first one, and that would be uh
Speaker 1: Luxo Jr. Where we got the little lampy guy that
Speaker 1: you see jump on the eye on the Pixar and
Speaker 1: it smushes the eye and it's now the eye exactly.
Speaker 1: I said, I wait, I I but yeah, Alexo Jr.
Speaker 1: That's They would later go back and sort of remaster that,
Speaker 1: but that became one of the early pitch films that
Speaker 1: they would use. And it also really kind of helped
Speaker 1: set Pixar's kind of aesthetic and tone, like there's this
Speaker 1: sort of cheeky humor that tends to be in Pixar films,
Speaker 1: and that was that was evident even as early as
Speaker 1: six when they designed this short. Yeah, it also got
Speaker 1: nominated for an Academy Award. Yes, it did not win
Speaker 1: that Academy Award, but it was nominated. And then in
Speaker 1: nineteen eight, just two years later, uh, they got another
Speaker 1: Academy Award nomination for Best Animated Short Film, and that
Speaker 1: film was called Tin Toy t I N Yeah not
Speaker 1: t E N Yeah t I N toy and a
Speaker 1: little It's a Little Tin Soldier and that one did
Speaker 1: win the Academy Award. It's also another adorable film that
Speaker 1: got remastered later on, and it would become the inspiration
Speaker 1: for a future Pixar mega blockbuster hit. Yes. Uh, In nine,
Speaker 1: we got another short from Pixar. Yeah, knick Knack. This
Speaker 1: is another one that got remastered and re released actually
Speaker 1: as one of the shorts that would come before a
Speaker 1: Pixar feature linked film. I don't think I've actually seen.
Speaker 1: This was a little snow globe with the snowman in it,
Speaker 1: and he's desperately trying to get over to a It's
Speaker 1: like a it's like a little a little souvenir choch
Speaker 1: key that you would buy at you know, Hawaii or something.
Speaker 1: Oh yeah, I do remember that. Yeah, And so the
Speaker 1: whole thing is the snow man's just desperately trying to
Speaker 1: get over to this hula girl y. Yeah. So that
Speaker 1: was another super adorable short. And that was when some
Speaker 1: other very important people to the future of Pixar would
Speaker 1: join the company. This was nine. That's when Peter Doctor
Speaker 1: and or Pete Doctor I should say, and Andrew Stanton
Speaker 1: joined the company. So they're making all these animated shorts,
Speaker 1: are getting lots of praise for them, Yeah, but the
Speaker 1: business side of things is still struggling. Yeah. They were
Speaker 1: not selling enough Pixar Image computers to pay off the
Speaker 1: costs of running business. And according to a lot of
Speaker 1: different stories, over the years, Steve Jobs collectively poured in
Speaker 1: about fifty million dollars of his own money to keep
Speaker 1: the company up float. And I would say, like, the
Speaker 1: average person doesn't even know that Steve Jobs was involved
Speaker 1: in Pixars. I mean, if you if you followed it
Speaker 1: early on, you would have heard about him being on
Speaker 1: the board of directors and things like that. But yeah,
Speaker 1: he was very much the reason why the company was still.
Speaker 1: If it had not been for Steve Jobs pouring money
Speaker 1: into Pixar, it would not have survived. Yeah, well it
Speaker 1: looked like they may not have at that point because
Speaker 1: they started getting layoffs and downsizing and uh, you know,
Speaker 1: at the same time, Steve Jobs is also struggling with
Speaker 1: his company Next. Yeah, Next was not doing well either.
Speaker 1: Next had created a very high end educational computer. It
Speaker 1: ran for like five thousand dollars a computer, so very
Speaker 1: expensive and no big surprise here. That meant that there
Speaker 1: weren't that many customers because not a lot of people
Speaker 1: are ready to drop five g s on a computer.
Speaker 1: And uh, even though people thought that, I think the
Speaker 1: elements of the operating system were really really innovative. So
Speaker 1: Jobs was having this issue where he's got one failing
Speaker 1: business and then another one. That is he's just constantly
Speaker 1: pouring money into He sees the potential there, but the
Speaker 1: question is can you ride it out long enough for
Speaker 1: that potential to pay off? Well, he kind of didn't.
Speaker 1: He kind of didn't, So he sold off the computer
Speaker 1: hardware division of Pixar that everything that he had set
Speaker 1: them up to do with the imaging and and such,
Speaker 1: he decided to get rid of it. Yeah, that was
Speaker 1: the part where he said, all right, we're gonna focus
Speaker 1: on the computer animation side, but we're going to not
Speaker 1: worry about producing actual computers anymore. And a company called
Speaker 1: Vicom Systems purchased the computer hardware business unit of Pixar
Speaker 1: for just two million dollars. That's not a huge turn
Speaker 1: on investment there, and Vicom in turn would end up
Speaker 1: going into bankruptcy just a year later. So it was
Speaker 1: not it was not the the the shot in the
Speaker 1: arm the Vicom needed to succeed. Not to be confused
Speaker 1: with Viacom. Yes, no, this is Vicom v I c
Speaker 1: O M. That's not the same as the cable company.
Speaker 1: So the hardware divisions gone, So the animation division just flourished. No, no,
Speaker 1: not quite. They still we're not. You're ruining my happy ending.
Speaker 1: Well he's gotta have. You gotta have the low point
Speaker 1: in act too before you can have the happy ending
Speaker 1: in Act three. Al right, continue on, all right, So
Speaker 1: here's the low point in act too. Pixar still wasn't
Speaker 1: making money and This led to another round of layoffs
Speaker 1: and half of Pixar was fired. Fifty of the employees
Speaker 1: were let go. One of those was co founder Alvi
Speaker 1: Ray Smith, who may have actually just left on his
Speaker 1: own after the changes, and he went on to co
Speaker 1: found another company called Altamira Software Corporation, which would later
Speaker 1: get acquired by Microsoft. He would stick around with Microsoft retire,
Speaker 1: So he's out of our story. And Steve Jobs was
Speaker 1: not done. He knew that something big and major was
Speaker 1: going to have to change soon, and to do that,
Speaker 1: he felt he needed to have absolute control of the company.
Speaker 1: But here's the problem. He had a majority stake in
Speaker 1: the company, but of those shares didn't belong to him,
Speaker 1: they belonged to employees. Yeah, so he shut the company down. Yep,
Speaker 1: he effectively ended Pixar. Pixar Pixar was no more. He
Speaker 1: closed the company. Is this one of those like Barrenstein
Speaker 1: Barrenstein issues where we think Pixar exists but it's actually
Speaker 1: in another reality, Jonathan, We'll have to answer that question
Speaker 1: after we come back from a quick break. Okay, so
Speaker 1: we're back and spoil alert. We know the Pixar comes
Speaker 1: back to because obviously the movies came out. Something had
Speaker 1: to happen, right, But it is true that that Steve
Speaker 1: Jobs he shut Pixar down. Then he decided to start
Speaker 1: a new company, a brand new company called rex Raxip.
Speaker 1: Neither of those that was I was trying to say
Speaker 1: Pixar back backwards. No. He he named the company Pixar. Yes,
Speaker 1: and then he hired back all the people who had
Speaker 1: been with Pixar just before he shut it down. Yeah,
Speaker 1: but he didn't give them their shares back. No. No,
Speaker 1: he would be the only one to hold the shares. Now,
Speaker 1: if I were employee, I'd be a little upset. So yeah,
Speaker 1: he shut down the company and then reopened the company,
Speaker 1: and now it was wholly owned by Steve Jobs, and
Speaker 1: the employees had no shares. Yes, And so then he
Speaker 1: decided to sell this company that he shut down or
Speaker 1: he considered it shut down and reopened. Yeah. He was thinking, well,
Speaker 1: now I owned the company, so no one can stop me,
Speaker 1: and I might be able to make back some of
Speaker 1: that fifty million dollars I've been pouring into Pixar for
Speaker 1: the last several years. So he started looking around at
Speaker 1: the possibility of another buyer. But while doing that, another
Speaker 1: opportunity came through the door. Yeah, they landed a twenty
Speaker 1: one million dollar deal with Disney for Toy Story, not
Speaker 1: just Toy Story, for five films. So that was where
Speaker 1: the real issue would come in. The original deal was
Speaker 1: to create three films. You're right, that was the original deal.
Speaker 1: So the original deal with three films, and it was
Speaker 1: a twenty one million dollar like up front and then
Speaker 1: they would get a certain percentage of profits afterward, but
Speaker 1: it was a very small percentage, as we will see.
Speaker 1: So it was definitely something that the company needed, Like
Speaker 1: the company needed that money. But if you look at
Speaker 1: that deal and you think twenty one million, that's like
Speaker 1: seven million dollars per film. Yeah, it's not. I mean
Speaker 1: when you think about what film budgets are, especially by
Speaker 1: today's standards, which of course, you know this was twenty
Speaker 1: years ago or so even then, like an animated film,
Speaker 1: I mean, that's nothing. So it's it is one of
Speaker 1: those things where it's it was it opened the door
Speaker 1: to Pixar, but it could have also spelled the end
Speaker 1: of the company. So they decided that they would make
Speaker 1: this film about toys that was inspired by the Tin
Speaker 1: Toys short that they had made before and um this
Speaker 1: was possible largely because Disney was looking at the possibility
Speaker 1: of funding animated films that the company itself wasn't having
Speaker 1: to animate. Yeah. Yeah, I mean they had success with
Speaker 1: that with The Nightmare before Christmas in Yes, so so
Speaker 1: there was some precedence for this where they the company
Speaker 1: Disney was saying, all right, well, we're still producing animation
Speaker 1: out of our our two studios, one was in l
Speaker 1: a and one was in in Florida, um at laced
Speaker 1: until Yeah. I remember going to the animation studio in Florida.
Speaker 1: It was great because you could actually I mean I
Speaker 1: remember seeing animated cells for things like a labin I
Speaker 1: did do and it's great. You got to see like
Speaker 1: stuff before it would come out. And then they shut
Speaker 1: it down. Yeah. But all this time Jobs were still
Speaker 1: thinking about selling the company. Yeah, and then he thought, well,
Speaker 1: you know, I could sell it off, maybe even to Microsoft,
Speaker 1: which is interesting because you know, Steve Jobs and Bill
Speaker 1: Gates and that sort of relationship. Yeah. They they've they've
Speaker 1: definitely been on either side of the friends enemies lines
Speaker 1: what from each other. And so they decided he said,
Speaker 1: you know what, I'll wait, I'm gonna wait a little bit,
Speaker 1: see how this goes, because if these films turn out
Speaker 1: really well, it'll put me in a better position than
Speaker 1: I would have been had I just sold it. At
Speaker 1: this point, so toy story ended up slowly taking shape.
Speaker 1: I mean, this was the first time that most of
Speaker 1: these folks over at Pixar had ever tried to put
Speaker 1: together a feature link film, and not everything turned out
Speaker 1: the way like the movie we got. It was very
Speaker 1: different from some of the concepts they had, which we
Speaker 1: will talk about towards the end of this um. So
Speaker 1: Lasseter directed it, and a whole bunch of people helped
Speaker 1: to write it, including Josh Sweden. Yep, he wrote one
Speaker 1: of my favorite lines, which is wind the frog. Yeah. Yeah.
Speaker 1: So at this point, Steve Jobs to you know, as
Speaker 1: Jones has has decided to hold off and hold on
Speaker 1: to Pixar for a while, and he was named CEO,
Speaker 1: which was interesting because technically cat Moll was still calling
Speaker 1: all the shops. He was just kind of the face man. Yeah.
Speaker 1: The idea was that because Jobs was well known and
Speaker 1: was a recognized figure in business, that that would add
Speaker 1: enough legitimacy to Pixar to give it a stronger market
Speaker 1: position like it was all about and I hate this word,
Speaker 1: but it was all about optics. Fun. Yeah, But what
Speaker 1: was fun was that toy Story. As we all know,
Speaker 1: big hit, yeah, enormous hit. It was actually funny story.
Speaker 1: I didn't even think about this when I was making
Speaker 1: the notes. That was the first film I ever saw
Speaker 1: with my wife in a theater when we were dating.
Speaker 1: It was and I had the convincer to go see
Speaker 1: it because she was like, I don't want to see
Speaker 1: a kid's movie. She loved it when yeah, I had
Speaker 1: already seen it, and I was like, just trust me,
Speaker 1: just trust me, and she trusted me, and twenty two
Speaker 1: years later she still won't let me pick the movie.
Speaker 1: But here's the thing. Toy Store is a huge hit.
Speaker 1: So you think, Okay, now Pixar's rolling in. Yeah, they're
Speaker 1: they're past their their struggles. Except that that deal I
Speaker 1: talked about earlier, the twenty one million dollars for three films.
Speaker 1: Part of that deal was that Pixar's share of the
Speaker 1: profits was tiny. It was around fifteen percent of the
Speaker 1: profits and everything else was going to Disney, so of
Speaker 1: the profits, right, So the movie's box office global box
Speaker 1: office was around three hundred sixty million dollars, which you know, again,
Speaker 1: you think about today and everyone's like, oh, if it
Speaker 1: doesn't hit a billion, I don't care. But back in
Speaker 1: the nineties, sixty million dollars, that's like huge take. Yeah,
Speaker 1: things were much more reasonable. Yeah, yeah, dollars. It was
Speaker 1: a dollar movie and you could get a bucket of popcorn.
Speaker 1: But and a song in your hot no, um no.
Speaker 1: But they that's the thing is that that they only
Speaker 1: got fifteen percent, so Disney's taking the profits essentially, and
Speaker 1: so this was tough. But Steve Jobs had an idea, right, yeah, yeah,
Speaker 1: he took the company public. He took Pixar public about
Speaker 1: Disney obviously, just a week after Toy Story premiered, which
Speaker 1: is great timing because everybody's really excited about this new
Speaker 1: Pixar movie, the first feature length animated film computer anim
Speaker 1: and so you know, perfect timing. Everybody wants in on
Speaker 1: that well. And this is also at a lull for
Speaker 1: Disney's animation, right, Like Disney had its renaissance with Little
Speaker 1: Mermaid and Aladdin and Beauty and the Beast and then
Speaker 1: the other films like Pocahontas, Hunch Mulan, those were starting
Speaker 1: to be more of a lull, at least as far
Speaker 1: as audience response, now that we're not saying those movies
Speaker 1: aren't great. Mulan, I like, I like I like Mulan.
Speaker 1: I don't like either of the other two, but I
Speaker 1: like Mulan, And so that also helped. Like this was
Speaker 1: so this was a great move for Steve Jobs. Like
Speaker 1: he was like, we're gonna put the company out, make
Speaker 1: it public right after this huge success. Everyone's really excited.
Speaker 1: It drives up the value of the company. Uh, it
Speaker 1: was the biggest I p O in even beat out Netscape,
Speaker 1: which was, you know, like the dominant web browser of Yep,
Speaker 1: we'll have to do an episode on that. But then,
Speaker 1: so the markets when they opened. Before they opened, the
Speaker 1: shares were estimated to open up at around twelve to
Speaker 1: fourteen dollars. It actually opened at twenty two and it
Speaker 1: got up as high as forty six dollars at at
Speaker 1: its peak that first day of trading, then settled down
Speaker 1: to thirty nine dollars, still an incredible gain considering that
Speaker 1: they originally thought it was gonna be twelve bucks of share.
Speaker 1: And is this what made Steve Jobs a billionaire? Yes,
Speaker 1: this is how Steve Jobs went from being a rich
Speaker 1: millionaire to a super stinking rich billionaire overnight. Here I
Speaker 1: thought it was all Apple. No, no, it was actually
Speaker 1: Pixar that really pushed him into the billionaire club. And
Speaker 1: at this point you probably think that, well, I bet
Speaker 1: some of those employees are said that they didn't have
Speaker 1: their shares anymore. I would be because they were no
Speaker 1: longer they weren't going to be billionaires. So the thing
Speaker 1: that this did allow Jobs to do is to go
Speaker 1: back to the bargaining table with Disney and say like, well,
Speaker 1: now Pixars a publicly traded company, we're valued very very high. Like,
Speaker 1: our our valuation is incredibly high. Uh, let's talk about
Speaker 1: this deal. So the deal, the three picture deal, was
Speaker 1: scrapped and a new deal was put in place, and
Speaker 1: this time it was a five picture deal that would
Speaker 1: last over ten years, so five movies and ten years,
Speaker 1: and the profits would be split right down the middle
Speaker 1: fifty fifty between Disney and Pixar. So this made, you know,
Speaker 1: picks are obviously happier, but also it kind of shut
Speaker 1: up some analysts that were saying that Pixar shouldn't be
Speaker 1: as value valued as high as it. Yeah, there were
Speaker 1: there were people who were questioning whether or not Pixar's
Speaker 1: value really was what it seemed to be in that
Speaker 1: in that week of the I p O. Because they
Speaker 1: were saying, people are really excited because you had one success,
Speaker 1: but until you have a proven series of successes, that
Speaker 1: doesn't really mean anything. Like you could you could have
Speaker 1: a freak home run and then you strike out the
Speaker 1: rest of the season. That was what they were saying.
Speaker 1: But it wasn't It still wasn't fair. All fairy tale
Speaker 1: endings for Disney and Picks are yet. No, No, that
Speaker 1: was the early years were rough. So the next film
Speaker 1: to come out was A Bug's Life, which I really enjoyed.
Speaker 1: It's often kind of grouped in some of the lesser
Speaker 1: Pixar films. Then you got Toy Story two, which originally
Speaker 1: Michael Eisner, the CEO of Disney, wanted to go as
Speaker 1: a direct to video type of sequel. I would have
Speaker 1: been fine with that. Laster, however, was not. Yeah, I
Speaker 1: love Toy Story too. I like Toy Story. I like
Speaker 1: Toy Story three better. No, I like Toy Story two
Speaker 1: more than three, but I like I like the original
Speaker 1: more than either of those. But you know what, I
Speaker 1: like more than either of those myself, What Monsters, Inc.
Speaker 1: And Finding Nemo, which came out next. Yes, so he
Speaker 1: had Bugs Life, Toy Story two, Monsters Ince Finding Nemo.
Speaker 1: But Steve Jobs and Michael Eisner were starting to have
Speaker 1: some problems. They were largely disagreeing over which films counted
Speaker 1: towards that five picture deal. Yeah, because Eisner didn't want
Speaker 1: Toy Story two to go to the theaters, so he
Speaker 1: didn't want that to count towards the deal. Yeah. He
Speaker 1: essentially said it's a sequel. See girls don't count. Yeah,
Speaker 1: the five five picture deals just for totally original I
Speaker 1: p and Jobs is like, the heck, did you just
Speaker 1: say we didn't say five ideas. Yeah, we said five films.
Speaker 1: So by the time Finding Nemo came out, word was
Speaker 1: getting around that Disney and Pixar had been holding talks
Speaker 1: about perhaps extending this agreement beyond those five pictures, but
Speaker 1: that the talks were not going well. And Steve Jobs
Speaker 1: actually released a statement and here's a quote quote after
Speaker 1: ten months of trying to strike a deal with Disney,
Speaker 1: we're moving on. We've had a great run together, one
Speaker 1: of the most successful in Hollywood history, and it's a
Speaker 1: shame that Disney won't be participating in Pixar's future successes
Speaker 1: end quote sadness. But Disney was like fine, and they
Speaker 1: tried to establish their own Well, they did establish our
Speaker 1: on computer animation studio and they called it Circle seven, Yes,
Speaker 1: which never made a movie by the way. No, it
Speaker 1: was intended to create sequels to the Pixar movies. Yeah,
Speaker 1: the idea being that Disney owns that intellectual property, so
Speaker 1: they could turn out as many sequels of Toy Story
Speaker 1: and Monsters in Finding Nemo as they wanted without Pixar's
Speaker 1: involvement at all. Um. Clearly that would have been rough,
Speaker 1: if not disastrous. Yeah. I think of some of the
Speaker 1: directive video sequels that Disney has done that have not
Speaker 1: been great. There have been something that have been really good.
Speaker 1: Line King one and a half is great, but a
Speaker 1: lot of the a lot of the ones are not
Speaker 1: so hot, and so that raised a lot of concern.
Speaker 1: But while this argument was still going on, Pixar was
Speaker 1: still making movies for Disney, and the Incredibles and Cars
Speaker 1: had come out, and that meant that they were beyond
Speaker 1: the five picture deal at this point that they something
Speaker 1: had to change. Cars came out in two thousand and six,
Speaker 1: and at that point Disney and picks Are we're able
Speaker 1: to settle their differences, and that's when Disney made the
Speaker 1: announcement that it would acquire Pixar for And this is amount,
Speaker 1: an amount that was astonishing when you think about how
Speaker 1: close picks Are was to going out of business just
Speaker 1: a few years earlier, for seven point four billion dollars. So, yeah,
Speaker 1: here's the computer animation studio that was losing so much
Speaker 1: money that a millionaire had poured fifty million dollars of
Speaker 1: his own money in it just to keep it afloat.
Speaker 1: Now acquired for seven point four billion dollars, Jobs would
Speaker 1: end up joining the board over at Disney UM and
Speaker 1: was an even richer billionaire. Yeah, and you know, you
Speaker 1: might be thinking, I thought Disney made some computer animated
Speaker 1: movies by themselves, and they did, but that's later on. Yeah,
Speaker 1: and it wasn't Circle seven. That was a division that
Speaker 1: they formed to do that, and ultimately Circle seven didn't
Speaker 1: do that in a gut kind of folded into other departments.
Speaker 1: So it was just one of those things where a
Speaker 1: company makes a division specifically to do something and then
Speaker 1: it just never works out, all right, So we want
Speaker 1: to end this episode of some fun facts. Yep. So
Speaker 1: here's some of the weird stuff about toy story. The
Speaker 1: original version of Woody was not a pole string cowboy. No,
Speaker 1: he was a ventriloquist dummy, which is creepy. Yeah, that's
Speaker 1: what Michael Eisner said. He said, no one thinks ventriloquist
Speaker 1: dummies or anything other than creepy. I don't want to
Speaker 1: have a creepy character as the protagonist. Change it. I'm
Speaker 1: sure at one point they weren't, but now they are
Speaker 1: mainly creepy. It's it's kind of hard. Like most of
Speaker 1: the Ventrolak was dummy movies. I've seen cast it in
Speaker 1: the form of like possessed dummy all you know, chucky,
Speaker 1: but that's all I've watched. Jeff Donoman not gotten scared,
Speaker 1: so that's you know, he scares the heck out of me. Anyhow,
Speaker 1: Next fun fact, Okay, well, buzz Lightyear was not originally
Speaker 1: buzz light you're His original name was Tempest, named after
Speaker 1: the classic arcade game. He also originally was aware that
Speaker 1: he was a toy. I'm glad they changed that. Well,
Speaker 1: apparently the reason why they changed it was that when
Speaker 1: Tim Allen came in to read for the character, he
Speaker 1: was playing him with such bravado and such like completely earnest,
Speaker 1: earnest and not not knowing he was a toy, like
Speaker 1: treating it like he is a space ranger. That the
Speaker 1: these these the writers were all saying, no, wait, this
Speaker 1: is way better. And that's when they made the choice
Speaker 1: to fear away from Buzz Lightyear, knowing that he was
Speaker 1: a toy um And and the last time fact is
Speaker 1: that Toy Starter was kind of it kind of had
Speaker 1: snow white syndrome. So they thought it would take eight
Speaker 1: animators and it needed thirty three yep. And they thought
Speaker 1: it would take fifty three processors and it took three hundred. Yeah.
Speaker 1: So yeah, this is is funny because when we did
Speaker 1: our episode about Disney uh going into snow White, it
Speaker 1: was very much the same thing, right, Like Walt Disney
Speaker 1: drastically underestimated how many animators and how much time it
Speaker 1: was going to take, and and they underestimated the time
Speaker 1: to make Toy Story as well. Yeah, as it turned out,
Speaker 1: the reason why they had to go with those three
Speaker 1: processors was because rendering each of those frames just took
Speaker 1: so much time, and when you think about like a
Speaker 1: frame is one of a second. So a full movie,
Speaker 1: a feature league movie, has thousands and thousands and thousands
Speaker 1: of frames, and when it takes hours to render a
Speaker 1: single frame, you then extrapolate that and you realize we
Speaker 1: will never finish making this movie. So obviously things have
Speaker 1: improved since then. But then also as technology improves, Pixar
Speaker 1: tries to push the envelope of how much it can
Speaker 1: do with that technology. So it's it's constantly a seesaw
Speaker 1: right that they'll animators will come up with a new
Speaker 1: way to test the technology to its limits, new technology
Speaker 1: will come out and rinse and repeat. Yeah. Well, this
Speaker 1: was a really fun topic. Thank you Nathan for requesting
Speaker 1: it and and kind of hitting a love of both
Speaker 1: Jonathan and mine. Yeah, we loved going back and looking
Speaker 1: at this story and again, like it's really interesting to
Speaker 1: see how much of it was rooted not just an animation,
Speaker 1: but in hardware. Yeah, yeah, which I always appreciate an
Speaker 1: aerial's eyes glaze over. No, I do appreciate it. Look,
Speaker 1: I like technology, This is just not the place for it. Okay,
Speaker 1: fair enough, entirely, Well, what is the place if people
Speaker 1: have suggestions to send us for future companies we should
Speaker 1: focus on. Well, that place would be our email. In
Speaker 1: our mail is feedback at the Brink Podcast Dot Show. Yeah,
Speaker 1: and Ariel reads every single one of those. Yes, please
Speaker 1: please write in. I love hearing from you guys. It
Speaker 1: makes my week. She's so lonely. And if you want
Speaker 1: to visit our website, that's The Brink Podcast Dot Show.
Speaker 1: We have an archive of all of our past episodes,
Speaker 1: so if you've ever missed one, you can go check
Speaker 1: that out. You can search to see if perhaps the
Speaker 1: company you were thinking of has been covered already, and
Speaker 1: if it hasn't, then definitely reach out to us. Or
Speaker 1: if it has, but you feel like there needs to
Speaker 1: be an update that's legit too. So that's that, and uh,
Speaker 1: that's it. I think until next time, I have been
Speaker 1: Jonathan Strickland and I've been aerial casting to infinity and
Speaker 1: be all business. On the Brink is a production of
Speaker 1: I Heart Radio and How Stuff Works. For more podcasts
Speaker 1: for my heart Radio, visit the I heart Radio app,
Speaker 1: Apple Podcasts, or wherever you listen to your favorite shows.
Speaker 1: E