The Ride of a Lifetime

by Robert Iger;

  Ike didn’t leap at it, but he didn’t reject it, either. We talked for another half hour, and then he suggested we meet later that night at the Post House, a steak place he liked in the East Sixties. Our dinner conversation was long and wide-ranging. I learned about the various businesses Ike had run, and about his life in Israel before coming to America. He was as tough and proud as advertised, and I didn’t press too hard on the idea of a possible sale—just enough to share my vision for how Marvel could be part of a bright future at Disney. Toward the end of the meal, he told me, “I need to think about it,” and I said I’d check in with him tomorrow.

  When I called the next day, Ike told me that he still had doubts, but he was intrigued. Ike’s a shrewd businessman, and he stood to make a lot of money from a sale to Disney, but he’d also taken control of Marvel when it was in trouble and had turned it around. I think the notion that some other CEO would just come in and buy it up didn’t sit easily with him, even though he knew he’d make a fortune off of it.

  Ike and I are very different people, and we’ve had our disagreements over the years since the acquisition of Marvel, but I genuinely respected where he’d come from in his life. He’d arrived in the United States with next to nothing, and by virtue of his own smarts and tenacity had become wildly successful. I wanted him to understand that I appreciated who he was and what he’d done, and that he and his company would be in good hands. However, Ike would never fit easily into a corporate structure or respond well to what he perceived as Hollywood slickness, so if he was going to be comfortable with selling to Disney, he had to feel like he was dealing with someone who was being authentic and straight with him, and who spoke a language he understood.

  Luckily for me, Willow happened to be in New York on business that week, and so I suggested to Ike that he and his wife join us for dinner. Willow doesn’t often attend business dinners with me, but her understanding of business, her resumé, and her ease with people make her a secret weapon. We met again at the Post House—at the same table Ike and I had sat at a few nights earlier. Ike’s wife, Laurie, is a smart, energetic person (who happens to be a competitive bridge player), and she and Willow made the conversation easy and relaxed. There wasn’t any business talk, it was just a chance to give them a sense of who we were and what was important to us, and for us to get a sense of who they were, too. Ike didn’t say it outright, but I felt confident by the end of the night that he was warming to the idea.

  * * *

  —

  THIS WASN’T THE first time Marvel had been on Disney’s radar. Early in my time working for Michael, I attended a staff lunch in which he floated the idea of acquiring them. A handful of executives around the table objected. Marvel was too edgy, they said. It would tarnish the Disney brand. There was an assumption at the time—internally, and among members of the board—that Disney was a single, monolithic brand, and all of our businesses existed beneath the Disney umbrella. I sensed Michael knew better, but any negative reaction to the brand, or suggestion that it wasn’t being managed well, he took personally.

  Among other things, Disney had a successful but often strained partnership with Miramax, run by Bob and Harvey Weinstein, which Michael had acquired in 1993. (The partnership was dissolved in 2005, when Michael was still CEO, and seven years later we sold the entire business.) Miramax released around three hundred films over those years. Many were critically successful and profitable, but many others lost money. There were intense fights with the Weinsteins over budgets and struggles over the content of films, particularly Michael Moore’s documentary Fahrenheit 9/11, which Michael Eisner didn’t want Disney to distribute. There was one problem after another, and while there were Academy Award winners, it was never easy with them. One example occurred in 1999, when Miramax launched Talk magazine, which was a huge money loser. They committed to the magazine with Tina Brown, before Michael had a chance to bless it, and it was a debacle from the beginning. I never had anything to do with the Miramax relationship, but I saw how it took a toll on Michael, internally and publicly. Fighting with Harvey and Bob Weinstein was a constant source of stress, on top of dealing with the board’s opinion that Miramax was fiscally irresponsible. As the pressure increased on him in the last few years, I watched Michael grow weary and wary. So when he got pushback from some executives over the Marvel idea, his default was not to force the issue. It wasn’t that long ago that he’d made the ABC deal, after all, so there was no great urgency to acquire another company.

  My highest priority when I took over as CEO had been to revive the Disney brand by reviving Animation. Now that John and Ed were in place, that problem was well on its way to being solved. Once Disney Animation was solid, I was open to other acquisitions, even if they weren’t obviously “Disney.” In fact, I was much more conscious of not wanting to play it safe. We’d taken a huge risk with the Pixar acquisition, and it would have been easy to hold our cards for a while rather than pushing for more growth. Three years after Pixar became part of Disney, though, the sands were shifting even more dramatically under the entire entertainment business, and it was important for us to keep thinking ambitiously, to capitalize on our momentum and expand our portfolio of branded storytelling.

  If anything, when it came to Marvel, I had the opposite worry of those who were wary of acquiring a company that was decidedly edgier than Disney: not what Marvel would do to Disney, but how loyal Marvel fans would react to their being associated with us. Would we possibly destroy some of their value by acquiring them? Kevin Mayer’s team researched that question, and after several conversations with Kevin, I felt comfortable we could manage the brands respectfully and separately, that they could exist side by side and neither would be negatively affected by the other.

  Some of Ike’s key creative people were understandably anxious about being acquired, too. I invited several of them out to Burbank and met with them myself, describing my own experiences with the Capital Cities and Disney acquisitions and assuring them that I knew what it felt like to be swallowed up by another company. I uttered the same sentence to them that I had repeated multiple times during my negotiations with Steve and John and Ed: “It doesn’t make any sense for us to buy you for what you are and then turn you into something else.”

  * * *

  —

  ONCE IKE MADE clear that he was willing to enter into a more serious negotiation, Tom Staggs, Kevin Mayer, and their teams began the exhaustive process of assessing Marvel’s current and potential value, as a stand-alone company and as part of Disney, in order to arrive at an offer that made sense. It involved a full accounting of their assets and liabilities and contractual obstacles, as well as their personnel and the issues of assimilating them into our company. Our team constructed a multiyear scenario of potential movie releases with projected box-office estimates. They also built into the model what we could do to grow the business within Disney—in our theme parks and publishing and consumer products businesses.

  Since the Pixar deal, with Steve as a board member and our largest shareholder, whenever I wanted to do something big, I talked it over with him, to get his advice and support before taking it to the full board. Steve’s voice mattered in our boardroom; they had such respect for him. Before we went any further in the negotiations, I went up to Cupertino and had lunch with Steve and walked him through Marvel’s business. He claimed to have never read a comic book in his life (“I hate them more than I hate videogames,” he told me), so I brought my encyclopedia of Marvel characters with me to explain the universe to him and show him what we would be buying. He spent about ten seconds looking at it, then pushed it aside and said, “Is this one important to you? Do you really want it? Is it another Pixar?”

  Steve and I had become good friends since we’d made the Pixar deal. We socialized on occasion and talked a few times a week. We vacationed at adjacent Hawaiian hotels a few times and would meet and take long walks on the beach, talking about o
ur wives and kids, about music, about Apple and Disney and the things we might still do together.

  Our connection was much more than a business relationship. We enjoyed each other’s company immensely, and we felt we could say anything to each other, that our friendship was strong enough that it was never threatened by candor. You don’t expect to develop such close friendships late in life, but when I think back on my time as CEO—at the things I’m most grateful for and surprised by—my relationship with Steve is one of them. He could criticize me, and I could disagree, and neither of us took it too personally. Plenty of people warned me that the worst thing I could do was let Steve into the company, that he would bully me and everyone else. I always said the same thing: “How can Steve Jobs coming into our company not be a good thing? Even if it comes at my expense? Who wouldn’t want Steve Jobs to have influence over how a company is run?” I wasn’t worried about how he would act, and I was confident that if he did do something that was out of line, I could call him out on it. He was quick to judge people, and when he criticized, it was often quite harsh. That said, he came to all the board meetings and actively participated, giving the kind of objective criticism you’d expect from any board member. He rarely created trouble for me. Not never but rarely.

  I once gave him a tour of a hotel in Orlando called “Art of Animation.” It’s a huge hotel, three thousand rooms, priced more affordably than many of our hotels. I was proud of its quality for the price, and when Steve came down for a board retreat shortly after it opened, I took him to see it. We walked into the hotel, and Steve looked around and proclaimed, “This is crap. You’re not faking anybody.”

  “Steve,” I said, “this is for people who want to come to Disney World with their kids and can’t afford to spend hundreds of dollars a night on a room. It’s ninety bucks, and it’s a decent, nice, clean, pleasant place.”

  “I don’t get it,” he barked. Most people would have appreciated the quality and the care we’d taken to design it, but Steve wasn’t most people. He was looking at it through his own lens.

  “It’s not for you,” I said. “I’m sorry that I showed it to you.” I was a little mad at his snobbery, but I also knew that was just who he was. He built things of the highest quality, not necessarily affordable to all, but he never sacrificed quality in order to attain affordability. I never showed him anything like that again.

  When Iron Man 2 came out, Steve took his son to see it and called me the next day. “I took Reed to see Iron Man 2 last night,” he said. “It sucked.”

  “Well, thank you. It’s done about $75 million in business. It’s going to do a huge number this weekend. I don’t take your criticism lightly, Steve, but it’s a success, and you’re not the audience.” (I knew Iron Man 2 was nobody’s idea of an Oscar winner, but I just couldn’t let him feel he was right all of the time.)

  Not long after that, at the 2010 Disney shareholders meeting, Alan Braverman, our general counsel, came up to me and said, “We have a huge no vote on four board members.”

  “How huge?”

  “Over a hundred million shares,” he said.

  I was baffled. Normally, there might be a 2 to 4 percent no vote at the most. A hundred million shares was way beyond that. Something was off. “A hundred million shares?” I said again. The company was doing quite well by then and our board members were well respected. There’d been no public criticism that I knew of, no warnings that something like this might come up. It didn’t make any sense. After a minute, Alan said, “I think it might be Steve.” He had all those shares, and he voted against four of his fellow board members. This was one day before we revealed the vote. Announcing that four board members had received a gigantic withhold vote would be a public-relations nightmare.

  I called Steve. “Did you vote against four board members?”

  “I did.”

  I said, “First of all, how can you do that without talking to me about it? It’s going to stick out like a sore thumb. I don’t know how I’ll explain it publicly, and I don’t know how I’m going to explain it to them. It’s going to eventually come out that it was you. Plus, they’re four good board members! Why are you voting against them?”

  “I think they’re a waste of space,” he said. “I don’t like them.” I started to defend them, then immediately realized that wasn’t going to work with Steve. I wasn’t going to convince him he was wrong. “What do you want me to do?” he finally said.

  “I need you to change your vote.”

  “I can change my vote?”

  “Yes.”

  “Okay, I’ll change my vote because it is important to you. But I’m telling you, I’m voting against them next year.”

  He never ended up doing that. By the time the next shareholders meeting came around, he was terribly ill and focused on other things. With these few exceptions, Steve was a wonderful, generous business partner and wise counsel.

  When it came to the Marvel question, I told him that I wasn’t sure if it was another Pixar, but they had great talent at the company, and the content was so rich that if we held the IP, it would put some real distance between us and everyone else. I asked him if he’d be willing to reach out to Ike and vouch for me.

  “Okay,” Steve said. “If you think it’s right, then I’ll give him a call.” He never would have invested in such a company himself, but he trusted and wanted to help me more than he hated comic books and superhero movies. The next day, he called and talked with Ike for a while. I think even Ike was impressed, and flattered, to be getting a call from Steve Jobs. Steve told him that the Pixar deal far exceeded his expectations, because I’d lived up to my word and respected the brand and the people.

  Later, after we’d closed the deal, Ike told me that he’d still had his doubts and the call from Steve made a big difference to him. “He said you were true to your word,” Ike said. I was grateful that Steve was willing to do it as a friend, really, more than as the most influential member of our board. Every once in a while, I would say to him, “I have to ask you this, you’re our largest shareholder,” and he would always respond, “You can’t think of me as that. That’s insulting. I’m just a good friend.”

  * * *

  —

  ON AUGUST 31, 2009, a few months after my first meeting with Ike, we announced we were buying Marvel for $4 billion. There were no leaks in advance, no speculation in the press about a possible acquisition. We just made the announcement, then prepared for the backlash: Marvel is going to lose its edge! Disney is going to lose its innocence! They spent $4 billion and they don’t have Spider-Man! Our stock fell 3 percent the day we announced the deal.

  Not long after the announcement, President Obama hosted a small luncheon with a group of business leaders in the Rose Garden. Brian Roberts from Comcast was there, and Alan Mulally from Ford, and a handful of others. We ate and chatted about our various businesses, and the president mentioned he was a big Marvel fan. Afterward, Brian and I shared a car from the White House. “Where do you see the value with Marvel?” he asked during the ride. I said there was an endless supply of IP. “Aren’t they all spoken for?” Some of them were, I said, but there are a lot more. Brian then told me he’d been talking with Jeff Immelt, the CEO of General Electric, which owned NBCUniversal at the time. (Before long, Comcast would buy NBC from them.) Jeff had apparently told Brian that our Marvel deal confounded him. “Why would anyone want to buy a library of comic book characters for $4 billion?” he’d said. “It makes me want to leave the business.”

  I smiled and shrugged. “I guess we’ll see,” I said. I wasn’t worried about what other CEOs would say. We’d done our homework. We knew that time would prove that the brands could easily coexist, and we knew there was a depth to the Marvel universe that most people weren’t aware of. During our research, we’d put together a dossier that contained a list of about seven thousand Marvel characters. Even if we couldn’t
obtain Spider-Man or the rights controlled by other studios, we’d still have more than enough to mine. The content was there, and the talent was there. (In fact, the Marvel Studios talent, led by Kevin Feige, described their long-term vision for what would become the Marvel Cinematic Universe, or MCU. There was a lot of work ahead of them, but the plan Kevin laid out, including a plan for intertwining characters across multiple films well into the next decade, seemed brilliant to me.)

  We assimilated Marvel quickly and easily. Ike kept running the business (which included their publishing, television, and movie divisions, among other things) from New York. Kevin Feige worked from Manhattan Beach and continued to report to Ike. Early on, this structure seemed to work, at least on the surface. The movies were successful, and it was apparent fairly soon after the acquisition that unless we made some egregious unforced errors or were blindsided by some unforeseen outside event, Marvel was going to be worth far more than we’d anticipated.

  As we came to understand more closely how Marvel worked, we became aware of a problematic dynamic between the New York office—Marvel’s home base—and the film-making business that Kevin oversaw in California. The movie business can be both thrilling and maddening. It doesn’t operate like other traditional businesses. It requires making bet after bet based on nothing but instinct. Everything is a risk. You can have what you think is a great idea and the right team assembled, and things can still get derailed for a whole host of reasons that are often beyond your control. A script doesn’t come together, a director has bad chemistry with his or her team or has a vision for a film that runs contrary to yours, a competitive movie comes out that upends your expectations. It’s easy to get swept up in the glamour of Hollywood and lose all perspective; and it’s equally easy to feel contempt for it and lose all perspective. I’ve seen both occur many times.