clock menu more-arrow no yes mobile

Filed under:

When the Lamp Switched On: How Pixar Went From Experimental Studio to Commercial Juggernaut

From the stewardship of George Lucas to Steve Jobs to Mickey Mouse himself, the story of Pixar is marked by breakups, risk-taking, and sheer creative flair

Getty Images/Pixar/Ringer illustration

Ahead of the release of Lightyear, The Ringer is hosting Pixar Week—a celebration of the toys, rats, clown fish, and more that helped define one of the greatest studios of the 21st century. At the heart of the occasion is the Best Pixar Character Bracket, a cutthroat tournament to determine the most iconic figure of them all. Check back throughout the week to vote for your favorite characters and read a selection of stories that spotlight some of Pixar’s finest moments. To infinity … and beyond!

For anyone who had ever gazed into the abyss of a computer screen and come away certain that something inside the machine could someday be capable of gazing back, the year 1995 was a heady time to be alive. It was the year of Steve Ballmer and Bill Gates herking and jerking on stage to introduce the splashy new Rolling Stones-approved desktop software Windows 95, and the year that, less conspicuously, Jeff Bezos and Pierre Omidyar introduced and eBay to a world that would never recover. It was the year that omnipresent e-portal America Online put out a press release announcing that it had “opened up access to the World Wide Web, the most popular and fastest-growing segment of the Internet,” and the year that the greater dot-com boom kicked off when browser company Netscape went proto-to-the-moon public. It was the year of The Net and Hackers, and the year that a consortium of consumer-tech giants announced they would soon begin shipping a cool new audiovisual format: the DVD. Somehow, that wasn’t even the only news, back in the fall of 1995, about digital advancements that carried the mystery and promise of, oh, just revolutionizing the arts.

Less than a decade earlier, the tetchy tech visionary Steve Jobs had spent $10 million buying an intriguing and maybe a little bit misunderstood experimental computer department from George Lucas. By late November of 1995, that unit, now a standalone business named Pixar buoyed by an eventual $50 million from Jobs, was an ambitious and unconventional innovation lab and animation production house that made its feature film debut on Thanksgiving with the futuristic, nostalgic Toy Story. A week after that, Pixar made another debut: on the Nasdaq exchange, with the ticker symbol PIXR, offering up 6.9 million shares of the company for sale. (Nice.) By the end of the first “feverish” day of trading, as the Wall Street Journal described it, the market had valued Pixar at a billion and a half bucks.

It wasn’t bad for a company proud of both its techno-creative heights and its low-key existence. Pixar, in those days, was a place where employees did imaginative work that was nominated for short film Oscars—and also frequently screened that work in a room strewn with ratty sofas that felt more like a fraternity den than an award-winning meeting space. “Pixar: Just turn left at the refinery,” read a t-shirt that some employees wore around the time of the IPO, a nod to the directions toward Pixar’s early headquarters—in modest Point Richmond, California, adjacent to, yes, a refinery—that were given out on the firm’s answering machine message for a time.

In the quarter-century-plus that has passed since Pixar’s 1995 IPO, many things about its business have changed, from the location of its headquarters (now in Emeryville, California) to the status of its PIXR stock (it’s no longer available, with all outstanding shares having been exchanged in 2006 for 2.3 shares each of Walt Disney Corp stock when The Mouse House purchased Pixar for $7.4 billion) to the top of its org chart (Jobs died in 2011, and longtime executive John Lasseter stepped down from his post following an investigation into his conduct in 2018) to the depth of its bench. In 1995, when Toy Story premiered, Pixar had at the time released only a couple of animated shorts. This weekend, when Pixar’s character study Lightyear comes out, it will be the latest effort from a creative behemoth that now has dozens of feature-length films and hundreds of beloved characters in its portfolio.

There are some things that haven’t changed about Pixar over the years, however, if its recent work is any indication. Directors like Pete Docter and Andrew Stanton still have unique creative license. The technical teams continue to come up with new ways to plumb the connections between science and art. Disney is at the ready to leverage its incredible branding and marketing heft. Going back to its earliest days, Pixar was always a place where some minds succeeded by solving intractable problems with vim and whimsy, and others by tackling existential issues with cold, hard code. And all these years later, it still is.

The trajectory of Pixar was altered by a breakup. A pair of them, actually. The first, in 1983, was the divorce of filmmaker Lucas and his wife, Marcia, a costly and contentious affair that resulted in Lucas looking around his industry empire to see what he might sell off for cash. One such asset, which he offered around for sale, was the “computer division” at Lucasfilms that focused in part on developing hardware products—like its “Pixar Image Computer”—that could more efficiently render enormous digital graphics.

Ross Perot, the businessman who would go on to be a presidential candidate, was one curious party, orchestrating a near-deal between General Motors and Philips to enter into a “strategic partnership” with the Lucasfilm business unit. According to early Pixar leader Alvy Ray Smith, GM was interested in using the technology “to replace their expensive clay-modeling technique for new-car designs,” while Philips saw potential related to CAT-scans. But their agreement was torpedoed at the eleventh hour (thanks to an unrelated clash of personalities between Perot and the GM board) reopening a conversation with another possible buyer: Jobs, the co-founder of Apple, who had looked at the division previously and had even recommended his company strike a deal. “But the folks running Apple weren’t interested,” Jobs told his biographer, Walter Isaacson, “and they were busy kicking me out anyway.”

That was the other breakup. Jobs was unceremoniously ousted from his own company in 1985. Restless in the year that followed, he started a new computer company, NeXT, and also finally invested $10 million to spin Pixar out of Lucasfilm in 1986. Initially, Jobs was mostly interested in what was basically business-to-business hardware; at the time, the Pixar Image Computer sold (poorly) for somewhere in the neighborhood of $125,000. But Pixar’s team, which had developed an imaging software called “RenderMan” among other tools and offerings, was eager to show off across various realms. Their early computer-animated short films, like 1986’s Luxo, Jr. and 1988’s Tin Toy, were creative works in their own right, but they were also proof of concept for Pixar’s technological innovations. The fact that the company not only could excel at doing both, but kind of had to if they wanted to keep some of their best and brightest employees, was what made Pixar, and particularly its funny little animation unit, stand out.

Luxo, Jr. earned an Academy Award nomination and made waves at a 1986 computer graphics conference called SIGGRAPH, the inside-baseball crowd awed by Pixar’s advancements in rendering light and shadow. Tin Toy (which featured a kinda unsettling 3-D diaper-baby a full decade before Ally McBeal famously did) was named best animated short at the Oscars in 1988, and its now-familiar premise of sentient toys would eventually roll into the concept of Toy Story years later. Pixar’s hardware still wasn’t flying off the shelves, even as its creative work was earning creative (and tech) industry nods of appreciation. And so—like so many entities in that exploratory aftermath of a breakup—the company pivoted a little bit. Which is to say: the company got into the advertising business.

Watching old Pixar-made advertisements from the dawn of the 1990s is a little bit like watching old Tony Hawk footage from around the same time. To the modern eye, the early tricks seem totally simple—which is how you know they were actually foundational texts to be forever studied. A dartboard in a Cellular One spot cast a dynamic shadow—a shadow! Nutri-Grain cereal flakes? That’s digital texture, baby! An ad for Lifesavers Holes, one of a number of spots for the Lifesavers family of products over the years, took on and pulled off the difficult task of conveying the iconic candy’s semi-opaque, sugar-spun hues. A humble Tropicana orange hopping around a warehouse may not have the same wow factor now, but in its day, that fruit was a marvel, a real feat of using binary computational power to output a representation of nature’s imperfect curvature.

Various work by Pixar for Listerine, which involved a bottle of Cool Mint swinging through a jungle Tarzan-style, fighting off plaque and gingivitis, represented great moments in graphical greenery. For that commission, Pixar employees solved not only how to render realistically-shaped leaves, but also how to populate a whole damn verdant landscape of them. It was a small but crucial bit of know-how that came in handy when putting together one of the most important scenes in what will always be Pixar’s most important film.

In the climactic chase scene in the original Toy Story, the main characters of Sheriff Woody and Buzz Lightyear team up for an aerial dash that takes place high above the street in their young proprietor Andy’s neighborhood. It is a lush, suburban landscape. In other words: it has a lot of trees, and it has a lot of leaves. Pixar’s previous for-hire work helped its creative and technical minds set the digital stage for the action sequence. And it was this expert attention to these sorts of little details that boosted Toy Story’s reception and Pixar’s future. Audiences may not have noticed each leaf, but they left feeling rooted in the cumulative effort behind the film’s every instant. And there were a lot of audiences.

Toy Story was a total hit that would finish as the top-grossing film of 1995. In To Pixar and Beyond, a book written by Pixar’s former CFO Lawrence Levy, the author recalls that the initial box office numbers over Thanksgiving weekend nearly doubled the appraisal of Pixar’s worth that had been put together by its underwriters. Initially, the deal was set to be priced at $12 to $14 per share. Instead, it was revised to $22 just days before going to market, and opened well above that. Jobs, who owned 80 percent of the company, luxuriated in the pricelessness of being right and the paper-wealth of being as rich as—well, almost as rich as one of his contemporaries. Levy writes that he “later heard” that when the bankers told Jobs that the IPO had entered him into billionaire status, he called his pal Larry Ellison. “Larry, I made it,” Jobs supposedly said.

The bankers, in this case, were from a firm called Robertson Stephens, which by the end of the nineties would be one of a handful of similar outfits referred to as “The Four Horsemen” of the dot-com boom for their work in backing so many startup disruptors. (Together, the firms’ names spelled out the acronym HARM.) In contrast to the Morgan Stanleys and JP Morgans of the world, Robertson Stephens was smaller, and based on the West Coast, and maybe a little bit more open-minded than the old guard—more willing to consider the bright side in Pixar’s balance sheets and financial disclosures. Sure, Toy Story looked like a surefire hit, a game-changing movie about child’s play. But as Pixar noted in its PIXR documentation, it wouldn’t be the one accruing all the lucre, or even most of it, from Toy Story’s success.

The upside of a rather desperate deal Pixar had signed with Disney in 1991 was that Toy Story had gotten made and been enthusiastically distributed. The rub was that Pixar’s cut of ticket sales was 12.5 percent, and also that Disney owned all the rights to the characters, and also that Pixar owed Disney two more films. The solution? The IPO, timed perfectly to turn that Disney promotional magic into the world’s happiest, most technically-SEC-compliant, and essentially free-of-charge investor roadshow. One 1995 Newsweek piece about Toy Story explained the scale of Pixar’s accomplishment by comparing it to industry competitors: “Digital dinosaurs in Jurassic Park got only 6 1/2 minutes on screen,” the story said. “In Casper earlier this year, the computer-generated stars were on for 40 minutes. The all-computerized Toy Story runs 77 minutes. Each 1/24th of a second requires five megabytes of memory. In geek-speak, that adds up to 550 billion bytes—enough floppy discs to bury Bill Gates in his new house. Kids, don’t try this at home.”

You can’t ask for better publicity than that. And in the years to come, the moment Jobs perceived that he had leverage over Disney, he took it. By 1997, the two companies had come to a new 10-year partnership for future movies that included a more 50/50 split. And when that deal was set to expire, not only did he convince Disney to buy Pixar outright—he helped bring about the ouster of Disney head and Pixar resister Michael Eisner in the process. Today, Pixar is part of Disney, lumped into the blue chip ticker symbol DIS, and yet the brand maintains a significant degree of independence and a continuity in its editorial eye.

All these years later, a quarter-century-plus since the ’95 IPO, the work has the same effect as always, whether it’s the old stuff or the new. To watch a Pixar movie is to have absolutely no clue how freakin’ difficult it is to make a fluffy monster’s arm hair sway like that—all while experiencing a scene so emotionally rich that the hair on your own arm stands on end. It is to take for granted all the instants that had to align just right, and all the intelligent design that must have been invested in, in order for that shadow to fall at that particular angle, and for that light to filter just so, in much the same way we take those things for granted when we watch a sunset or a bird building a nest in real life. It is to know that for years, some of the top minds across multiple industries have devoted their talents to creating animated, soulful turtles, jalopies, insects, rats, lost souls, and a Bing Bong. This is the market working as it should, offering us the things we didn’t know we wanted so that we can choose the ones we really need.

The Midnight Boys

‘Spider-Man: Across the Spider-Verse’ Instant Reactions

The Rewatchables

‘Casino Royale’ With Bill Simmons, Sean Fennessey, and Amanda Dobbins


‘Spider-Man: Across the Spider-Verse’ Is a Multiversal Masterpiece

View all stories in Movies