Ed Catmull: Building Pixar and sustaining creative culture

Executive overview

Ed Catmull spent over 20 years pursuing a single goal — the world's first computer-animated feature film. When Toy Story succeeded and Pixar IPO'd, he felt hollow and adrift. The real work, he discovered, was building a culture that could keep creating.

Catmull's answer was a set of hard-won management principles: protect candor over hierarchy, put people before ideas, and treat problems as inevitable rather than exceptional.

Getting the team right is the necessary precursor to getting the idea right.

Childhood influences and early direction

• Walt Disney and Albert Einstein were Catmull's two boyhood heroes — one embodied inventing the new, the other explaining what already existed.
• Catmull couldn't draw, so he found a different route into animation: computer science at the University of Utah in 1969.
• Ivan Sutherland and Dave Evans ran the CS department with a light touch — workspace, computer access, and freedom to pursue whatever students found compelling. Catmull later replicated this at Pixar.
• Jim Clark (Silicon Graphics, Netscape) was a classmate; the U of U hosted one of the four original ARPANET nodes. Catmull had a front-row seat to the birth of the technology industry.
• At 26, he set a new goal: animate with a computer, produce images compelling enough for film.

George Lucas and the origins of Pixar

• In 1979, Lucas hired Catmull to bring high technology into filmmaking — an idea no one else in Hollywood was pursuing.
• Lucas's management style: relentless practicality, a long view, and folksy analogies. He idealized the process of moving toward a goal not yet reached.
• Lucas funded the Pixar Image Computer — a high-end machine for combining special effects with live action.
• When Lucas's divorce forced asset sales, Pixar was shopped to over 20 buyers. No one bit. A last-minute GM deal fell apart one week before signing.

Steve Jobs enters

• Steve Jobs first met Catmull in February 1985, still at Apple. His opening: no small talk, only questions. His self-summary: "insanely great products."
• Catmull found Jobs's intensity threatening at first — "He was the speaker. Everyone else was the guy in the chair."
• After Jobs was removed from Apple, he sought Pixar out again as a new mission. He paid $5M to spin Pixar out of Lucasfilm and committed another $5M to fund it — ultimately putting in $54M, a large fraction of his net worth.
• Jobs told Catmull and Alvy Ray Smith: "Whatever happens, we have to be loyal to each other."

Building the business and going all-in on animation

• Early years were a constant search for a working business model. The Pixar Image Computer sold roughly a hundred units. Pixar had no salespeople, no marketing, no experience with P&L or inventory.
• Catmull adopted W. Edwards Deming's principles as management metaphors: responsibility for quality belongs to the people closest to the work. "You don't have to ask permission to take responsibility."
• Three times between 1987 and 1991, a frustrated Jobs tried to sell Pixar — but couldn't bring himself to part with it. Catmull read this as Jobs seeking external validation, not an exit.
• Pixar laid off over a third of its staff and abandoned hardware. The pivot: go all-in on computer animation, the one thing they had always wanted to do.
• A three-picture deal with Disney gave Pixar financing and distribution. Jobs held the line on technology ownership: "You're giving us money to make the film, not to buy our trade secrets."

Toy Story and the IPO

• Jobs called the Toy Story IPO one week after the film opened — the biggest IPO of 1995, raising ~$140M.
• His logic: a successful Toy Story would make Eisner realize he had created a competitor and push to renegotiate. Pixar needed public capital to fund 50% of future productions and negotiate a 50-50 split.
• Eisner called months later, accepted the 50-50 terms. Jobs had called it exactly right.

What to do after you get everything you wanted

• After Toy Story, Catmull felt empty and adrift despite achieving everything he had worked toward for two decades.
• He assigned himself a new mission: how to enable the talents of Pixar's people and keep the creative environment from being destroyed by its own success.

People over ideas

• During Toy Story 2, a near-identical story spine produced one version that failed and one that won an Oscar. The difference was the team.
• "If you give a good idea to a mediocre team, they will screw it up. If you give a mediocre idea to a brilliant team, they will either fix it or throw it away and come up with something better."
• Pixar restructured: disbanded the development department that searched for ideas and replaced it with a mandate to find and support good people, who would then develop good ideas.
• An overworked employee nearly left his infant in a car during Toy Story 2's crunch. Catmull's conclusion: "It is my job to protect our people from their willingness to pursue excellence at all costs."

Candor, brain trust, and creative process

• All Pixar films start bad. "Pixar films are not good at first. All the movies we now think of as brilliant were at one time terrible. This is as it should be."
• The brain trust — 5 to 30 people meeting with a director — gives blunt feedback throughout production. Critically, it has no authority. The director is not required to follow any specific suggestion.
• You are not your idea. Identifying too closely with an idea means taking offense when it is challenged.
• Andrew Stanton's principle: be wrong as fast as you can. Choose a hill, attack it, and if it's the wrong one, turn around. The only unacceptable move is running between the hills.
• Conflict is essential. Brad Bird: "To view lack of conflict as optimum is like saying a sunny day is optimum. If it's sunny all the time, the planet dries up."

Quality as the business plan

• Disney wanted Toy Story 2 direct-to-video — a pure revenue play, not a quality decision. Catmull fought back.
• John Lasseter coined the phrase that became a Pixar maxim: quality is the best business plan.
• Everything associated with the Pixar name had to be good — not just the films, but every interaction, every product. The same logic Steve Jobs applied to Apple as "the Apple Experience."
• Making the process better is not the goal. Making something great is the goal. Process that supplants the goal produces predictable, unoriginal work.

Limits and the sale to Disney

• Imposed limits are a creative tool. Without deadlines, the demand for time and resources is bottomless. A deadline forces a priority-based reordering and the hard conversation about what is actually necessary.
• "Companies, like individuals, do not become exceptional by believing they are exceptional, but by understanding the ways in which they aren't exceptional."
• Steve Jobs and Michael Eisner could not work together. When Bob Iger became Disney CEO, his second call after his daughter was to Jobs. Iger told Jobs directly how badly Disney needed Pixar — an unusual negotiating move that Jobs immediately respected.
• Disney bought Pixar for ~$7.6B in stock. Jobs, as the largest Pixar shareholder, became the largest individual shareholder in Disney. This made him a billionaire — off Pixar, not Apple.

The Steve Jobs that Catmull knew

• Catmull worked with Jobs for 26 years — longer continuously than anyone else.
• The early Steve was frequently dismissive and brusque. The popular narrative froze him there. The reality: he changed profoundly.
• "He became fairer and wiser, and his understanding of partnership deepened."
• Jobs respected that Pixar's people knew things about graphics and storytelling that he did not. He stayed out of creative decisions while being Pixar's fiercest external defender.
• If you argued with Jobs and convinced him you were right, he would instantly change his mind. He did not hold on to ideas because he had once believed them brilliant.
• Jobs on Pixar vs. Apple: Apple products eventually end up in landfills. Pixar movies live on forever.
• John Lasseter's final visit: "I looked at him, and I realized this man had given us everything that we could ever want. I kissed him on the cheek, and I said, thank you. I love you, Steve."