How Walt Disney Built a Modern Day Dynasty

Long before Walt Disney built the dynasty that is now the corporation it is, he was a struggling artist, trying to find his way.

Today, Disney owns the most household brands of any media company on the planet. After the acquisition of 21stCentury Fox, Disney showed a net worth of more than $238.9 billion, much more than the man who started it all could have imagined. Today, if you see a Pixar, Marvel, or Star Wars movie, you’re watching something produced by Disney. The media franchise, along with the incredible theme parks around the world, bring smiles of imagination and wonderment to us all.

Where did Walt Disney Come From?

We have to look back more than a century to 1919 when Walt returned from driving for the American Ambulance Corps in World War I. He was searching for work and knew he was a bit of an artist, which brought him to the Pesmen-Rubin Commercial Art Studio. Although the studio would be only a brief job, lasting one year, he met Ubbe Iwwerks (later spelled Iwerks), and Walt began to learn under the tutelage of one of the most talented animators in the world.

The First Attempt at His Own Company

When Pesmen-Rubin didn’t work out, Walt and Ubbe tried to pen their own studio. It didn’t’ take long for them to learn they needed paying work which led them to work in animation at Film Ad Co. Here, they began to make advertising shorts for the features that would show ahead of the feature film. While creating these ads, the pair began making comedic shorts they called Laugh-O-Grams. Once again, they ventured out together to make these Laugh-O-Grams into a business, but that venture went sour in 1923.

Heading to Hollywood

We know Walt Disney Studio began in Hollywood, but did you know it was first named Disney Brothers Studio? That’s right, Walt convinced his brother Roy to help him start the company that was later renamed only for Walt. Not long after this venture began, Iwerks joined the pair in Hollywood. Even though the studio wasn’t more profitable than the two previous failed ventures, they were able to keep it going. Unfortunately, the worst happened to Walt, teaching him a valuable lesson.

The Lesson for Walt Disney

We know Mickey Mouse has been around for a long time, but before this character, Disney and his team were responsible for Oswald the Lucky Rabbit, which they created for Universal Pictures. In 1928, a major surprise befell the Disney brothers. All of their animators, except Iwerks and a few others, were hired away by Universal. This was a massive blow to Walt, but worse than that, Oswald belonged to Universal, which meant he and Roy could not use the character any longer.

Along Comes the Mouse

There are many rumors surrounding the origin of Mickey Mouse, but the result is something that sent Disney to the success we see now. Walt and Roy assembled a new team of animators for Iwerks, who developed the character of Mickey Mouse and began to put films together. The first two attempts didn’t gain much traction or attention, but the third one did. The third film, “Steamboat Willie,” was amazingly successful. This was an impressive example of putting sound and animation together, something that was still new at the time.

Disney Found His Secret Sauce

Walt Disney realized what he needed to do to gain attention and make money in the media business. He needed to ensure his company was always on the cutting edge of technology. With very little technology at a time, he was able to do this. The Great Depression hit, but that didn’t slow Disney down at all. During that decade, he created the first color cartoons and the first animated feature-length film, “Snow White and the Seven Dwarfs,” which is a magical masterpiece of Disney that many still love to this day.

Troubles When Making Animated Films

All it would have taken during those early years to send Roy and Walt to the poorhouse would be a poor box office showing. It wasn’t that their films weren’t making money; it was that their product had extremely low margins for profit. Some of the films we consider masterpieces today were drains on the finances of their company. These films include “Bambi,” “Fantasia,” and “Cinderella.” You might wonder how these films could do poorly, which goes back to the point of being extremely expensive to make, not how much they brought in at the box office.

How Did Disney Increase Margins?

Instead of slowing down and offering fewer films, the Disney brothers created Buena Vista studios and began producing nature documentaries. These films required fewer people, cost a lot less, and seemed to be just as popular as some of the animated films. The nature movies became the high-margin items needed to allow Walt Disney Productions to become profitable and begin to build on that profit.

Disneyland was the Next Ticket to Success

After learning more about business when Universal took his team and his character, Walt Disney became shrewd and understood how to build a company and maintain rights to what he had to offer. He did this with Disneyland. To fund the “happiest place on earth,” a lot of financial maneuvering had to occur. He did this by funding a private company, using money from his own life insurance, and setting up another private company that owned the merchandising rights to his name. That meant he was getting paid for all products sold with his name on it at Disneyland. Eventually, Walt Disney Productions paid to buy the company back in 1981.

A Television Series

To advertise for his new theme park, Walt offered to create a television series for any network that would invest in Disneyland. ABC was the company that invested, and the show he created became a huge hit that ran under various titles for 29 years. From then on, it seemed everything Disney touched turned to gold. His legacy and vision continue to this day, even though both founders have passed on. It would be hard to imagine a world without a Disney movie or the theme parks that bear Walt’s famous name.