In 1979, George Lucas, already a global icon as the creator of Star Wars, made a move that many saw as sheer madness—he founded a computer graphics studio. This studio, later named Pixar, was meant to produce video and audio of such exceptional quality that fragments could seamlessly integrate into films.
To bring this vision to life, he assembled a small team of pioneers—technical genius Ed Catmull and creative innovator Alvy Ray Smith.
The studio had modest successes. One scene in a Star Wars sequel was rendered entirely with computer graphics, an achievement for its time. But the big breakthrough hadn’t come yet. And Lucas wouldn’t be the one to make it happen.
By 1986, Lucas was going through a financially devastating divorce. His assets were tied up, his cash reserves drained—he had to sell something. The least valuable asset in his portfolio? The computer graphics studio.
The problem? Nobody wanted to buy it. Investors saw little potential in it. Every single one turned it down—except for Steve Jobs.
Jobs, who “never did anything for the money,” was interested, but only at a steep discount. He offered six times less than the studio’s actual value. Lucas had no choice. Pixar was his only disposable asset, and it went to Jobs for just $5 million.
At the time, Jobs was in a strange place. He had money—after all, he left Apple a billionaire—but his new ventures weren’t working. His company NeXT launched with enormous hype. Obsessed with design perfection, Jobs dazzled the world with a futuristic black cube of a computer. But there was one problem—no one needed it.
NeXT was marketed as a high-performance machine for scientific research. It cost twenty times more than the IBM machines Jobs despised, yet its advantages were debatable. Yes, Tim Berners-Lee would later use a NeXT machine to write the first web browser at CERN, and John Carmack would develop legendary games like DOOM on it—but even these milestones couldn’t save the company.
Meanwhile, Pixar sat in Jobs’s portfolio, and he didn’t quite know what to do with it. He hadn’t bought it for animation—his real interest was in its cutting-edge computer.
Jobs saw its potential in hardware, not filmmaking. He envisioned a powerful yet affordable 3D graphics workstation, one that could be sold to professionals and even consumers. He slashed the price to $30,000 and poured money into the project.
A lot of money.
Jobs funneled $50 million into Pixar’s technology—ten times what he had paid for the company. But there was one problem: the market didn’t exist. Consumers weren’t eager to sit at home rendering 3D images. The project was a failure, and Jobs had to abandon it.
But something changed. Jobs, for the first time in his career, stepped back and let professionals do their work. He still made strategic decisions, but with an unusual level of restraint and precision.
And it paid off.
By the 1990s, Pixar had transformed into a powerhouse in short-form animation and high-end advertising. But its true moment arrived when it turned to feature-length films.
The studio’s first attempt, Toy Story (1995), directed by John Lasseter, wasn’t just a success—it was a revolution.
Jobs had hoped for a box office hit, maybe even $100 million or $200 million in revenue. He underestimated. The film grossed $360 million. The wave of animated features that followed made him $2.5 billion richer.
In 2006, Jobs sold Pixar to The Walt Disney Company for $7.4 billion, acquiring 7% of Disney’s stock—making him its largest shareholder.
For once, he had resisted the urge to micromanage. He had trusted the right people. And it was the best decision he ever made.
Pixar didn’t just change animation—it changed the entire film industry.
Today, CGI no longer amazes audiences; it’s just another tool. And as we speak, that tool is being swallowed by AI.
