Transcribe your podcast

Hey, listeners. It's Chris Gotier, producer on Masters of Scale. With AI transforming the business landscape, it's essential for entrepreneurs to think critically about the ethics in AI. The first step? Register for the next virtual AI and you strategy session presented in Alliance with Capital One Business. You'll hear expertise from Effectiva CEO, Rana L. Kayuber, and Masters of Scale host, Reed Hoffman. This live virtual event takes on December 14th at 6:30 PM Eastern, and it's completely free. To register, go to mastersofscale. Com/aistrategy. This is the final strategy session of 2023, so you won't want to miss the opportunity to learn how to ethically harness the power of AI. Again, you can register now for free at mastersofscale. Com/aistrategy.


When Steve Jobs bought us at the beginning, to be honest, we were nervous because we did know what Steve was like and what their reputation was. I have to say, for several years, I didn't see any sense of humor at all.


That's Ed Catmull, co-founder of Pixar, recalling Steve Jobs as a creative genius. Yes, but a genius who is demanding, brash, abrasive, and that's putting it mildly.


I would say from '91 to '95 was a dramatic change in him as a person. He became more empathetic and caring. He paid attention to people. You actually begin to see him having a sense of humor.


But this reputation stuck with Steve even after the changes Ed is talking about.


So when the stories were written about him, they're about the early public stories because, frankly, it's sexy to talk about bad behavior or various things like that. It makes for more dramatic television.


A good example of that dramatic television is the 1999 TV movie Pirates of Silicon Valley.


Noah Wiley had played Steve in a television movie that was fairly derogatory toward Steve. I want beauty.


Not incompetence. Are you listening to me? Are you listening?


Yes, I'm listening. I'm so sick of your abusiveness. That's all you know, tearing people down, throwing tantrums, and miserable-You're a miserable son of a.


Shortly after the film came out, was the annual Apple showcase, Macworld 99, invent the image of Steve Jobs as an intense, humorless, taskmaster, was fresh in the minds of attendees. That didn't stop them from going wild as the light dimmed and a turtle-necked figure screwed out to the center of the stage.


Welcome to the Macworld 99.


Stage, Steve Jobs.


This is going to be a great Macworld. What you can hear in the audience, this increasing titter, as people begin to laugh because they realized it wasn't Steve. Now, in fact, it was Noah Wiley that came out. You know, everybody at Apple has been thinking different for the last couple of years. We're selling a lot of computers, but there's something else happening here. The resurgence of Apple. This went on for a couple of minutes and then reached the point where Noah Wiley says something like an extreme version of what Steve used to say. Some really great new product. Some insanely great new product. Some really totally, wildly, insanely great new product. We have got products that are going to make you… And then Steve came out. That's not me at all. That's not me at all. You're throwing it. Look, you're supposed to come over here, open the water. Now, Steve, with this lighter sense of humor, thought it would be a great idea to have No while he come out on the stage and pretend to be him. He just demonstrated the depth of humor to be able to do that. It's a.


Insanely great thing we talked about a hundred years ago. This moment of levity was a clear indication of how Steve had changed. It's a change it had been tracking for a long time, even if most of the world overlooked it, and it had a huge effect on how Steve worked.


Part of his change over time was that in recognizing why things weren't going the way he expected, he could then change the way he worked and thought about people. And throughout his life, he kept learning and growing as we all should be doing. As a result of that, Steve and Apple had a major transformative effect in the world.


The MacBook, the iPod, iTunes, and the iPhone, these are some of the vastly impactful things that Steve Jobs shepherded into the world. I'd argue these were all so successful in part because Steve learned to change his approach, his process, and even the way he saw himself. I believe you need to constantly tweak, hack, and reinvent the ways you work to keep at the top of your creative game. You got to have incredible talent at every position. It's like this is a huge push. There are fires burning when you're going home.


Can you.






It's such an idiot. And then.


You go back to, This is.


Totally going to be amazing. There are so many easy ways to do it. I have no idea what to do. Sorry, we made a mistake. But you have to time it right.


I'm working as a.


Free-bedroom partner.


Stuff that just seems absolutely nutball. 10 years.


Later, I'm like, Well, that's just how.


You do it. We haven't made just how you do it. This is Masters of Scale. We'll start the show in a moment, after a word from our premier brand partner, Capital One Business.


We'd had all these crazy moments. I would never lock my door in my fourth-floor East Village walkup because I could never find my keys and it was just too much of a hassle.


That's Deepa Gandhi, COO and co-founder of Dagnidover, an accessory brand. And she's sharing a story about one of the many handbag problems her and her co-founders experienced as busy women on the go.


The immediate problem that we were trying to solve was just a great work bag for women. Can I have a bag that looks good, that's structured, that's made out of a durable material that also has a place for my laptop where my water bottle won't spill over and ruin everything in the bag?


Deepa and her fellow founders, CEO, Melissa Mash, and Chief Creative Officer, Jessi Dover, saw a need and started a company in order to fill it.


The first two products we launched were direct responses to challenges that we had personally experienced, and they were focused on the working woman. It was the perfect tote. It fit your laptop, water bottle, keys, pens, anything and everything, and this clutch wallet. That could actually work as a system.


Dagnedover's focus on the simplicity of a great product made their bags must-haves for working women, but their next best seller would expand their market in ways they'd never imagined. It's all part of the ReFocus playbook. A special series where Capital One Business highlights stories of business owners and leaders using one of Reed's theories of entrepreneurship. Today's playbook insight, products that do too many things are hard to explain. Turn your focus to creating a simple product with a clear, simple story.


I'm Reed Hoffman, Partner at Greylock, Co-Founder of LinkedIn, and your host. I believe you need to constantly tweak, hack, and reinvent the ways you work to keep at the top of your creative game. Imagine the challenges involved in trying to teach chess to a toddler. First, you've got to try to explain the complex set of rules in a way that a three-year-old can understand. Then there's the question of their short attention span. But probably the biggest challenge you'll face is playfulness. What young kid could resist picking up a knife and galloping it across the board or grasping a bishop and pretending it's a rocket ship? In short, your patience is going to be tested. But imagine you managed to push through this initial frustration, perhaps alter your goal. Instead of teaching a kid chess, you're going to use the pieces and the board to engage with them on their terms.


Once you adapt to the new rules of the game and accept they'll keep on changing, you could even have fun and start getting creative. As a leader, you need to be ready to do more than adapt to new ways of playing the game. You need to embrace them and then come up with your own rules in response. Accepting that the rules you play by need to be constantly tweaked, hacked, or reinvented opens you up to new ways of doing things. Instilling this attitude throughout your organization will help you be boldly differential in your experimentation. I wanted to talk to Ed Cotmull about this because he literally wrote the book on creating a dynamic and sustainable creative culture. Creativity Inc. Has become a foundational text on how to presume dynamism throughout an organization. Ed was an early pioneer of computer graphics and went on to co-found Celebrated animation studio, pixel, which counts to Toy Story, The Incredibles, and Elemental among their many beloved hit movies. In his role as President of Walt Disney animation studios, his push to reinvigorate the creative process resulted in a string of successes, including Frozen and Zutopia. Ed was first switched on to the magic of animation by the art form's most famous pioneer.


I grew up when Walt Disney was on television every Sunday night, and both showing programs that were available plus animation, including how things worked. It was pretty amazing. Even as a kid, I knew that they were stimulating something in my head. What I imagined myself doing was becoming an animator.


The TV show that had Ed glued to the sitting room floor of his family home in Salt Lake City was The Wonderful World of Disney. The more Ed watched Walt reveal the tricks in the Magic Kingdom spellbook, the more enthralled he became. But Walt wasn't the only great mind of the 20th century to capture Ed's imagination.


I loved taking science classes in physics. The other iconic figure of that time was Einstein. There was something pretty magical about what he was doing and what he'd figured out. I would read the books about it.


Throughout his childhood, Ed dove deep into both of his passions, becoming a skilled artist while pursuing his scientific curiosity. While he was studying for his bachelor's in physics at the University of Utah, Ed found himself drawn to another cutting edge field.


I'd always wanted to be at the frontier where you discover something. When I took a computer science course, I thought, Well, this is like being at the front of the Easter egg hunt. You're just going to go out and find things and gather them up. And it made it exciting.


In 1969, Ed graduated with two degrees, one in physics and the other in computer science. He then doubled down on computing as his path.


When I returned to graduate school, it was initially to study computer languages with some thought about artificial intelligence.


It's tempting to take a brief pause and consider an alternative universe in which I'm speaking with Ed Catmull, Pioneer of AI, rather than Pioneer of animation. There are deep parallels between the huge advances in computing underway at this point in Ed's story and the seismic impacts of the current AI revolution. Like AI, the computational wave that Ed was immersing himself in was going to inform sweeping changes in technology, industry, and society. Like AI, it was impossible for anyone to predict what these changes would be. People were feeling their way through the possibilities and potentialities of the computer revolution. For Ed, one of these roots proved especially tantalizing. Soon, another unplanned encounter changed Ed's destiny.


The first course I took was one in computer graphics, and that blew me away and basically changed everything. It's like all of a sudden, bam, things came together and the art and the technology and the physics, like wow, they're all mixed together and this is a new direction. And it was actually thrilling.


This new area of computer graphics was a dynamic combination of Ed's passions, animation, science, and technology. The way the classes were taught reflected this, with students largely left to create their own projects and curriculum.


We were all discovering things together and providing support for each other. There was something about having to discover what to do when there really wasn't a curriculum. I'll let you say is solve the next problem. You figure out what the curriculum is.


This environment was radically different to what you would normally expect of a graduate class. The course leaders had tossed out the very notion of a curriculum, partly because the field was so new, but also because they knew that this was the best way to stimulate the creativity of their students and was soon helping to push the boundaries of this new technology.


There are some software so that people could make pictures, but I looked at that and said, You can't do anything with that. I decided to write my own software to make a model of my hand. I made a plaster Paris model. I then digitized it by looking through a piece of plastic with a grid on it to figure out where all the points were on this surface. I wrote a program to animate it to move it around, not only move the fingers, but also look around inside the hand with the camera. It had never been done before, and it was exciting.


You can see the results for yourself by searching for A Computer animated hand by Ed Catmull on YouTube. The video also contains the work of a fellow grad student of Ed's, Fred Park.


He also wrote his own software and he digitized the image of his wife's face. We were the only two that stayed in computer graphics because we were the ones that rejected what was already in place and said we need something new.


These are foundational works in the history of computer animation, and they only came about because Ed and Fred were prepared to throw out the existing animation software available to them and then create their own. One of the first things I look at when considering an investment is whether the founders are rejecting the status quo. If I'd been to ask the fun projects in Ed and Fred's class, I'd have been drawn to the two students who are breaking out of the constraints of the tools available to them. Because when you see someone asking the question, Whythis way, it signals a willingness to create your own rules. This willingness is at the core of entrepreneurial success. Ed's graduate work brought him back to his first love, animation. It inspired him to set a new goal to someday create a full-length computer-animated feature film.


Okay, this can get to the point where it's going to change filmmaking. But I had no illusions about us almost being there.


The advice from one of Ed's graduate professors meant Ed wasn't deterred by this time frame.


Ivan Settleland, the father of computer graphics, who built the first AR and VR system. For Ivan, you can have a big vision, but you've got to go a step at a time. And so everybody understood in this environment that our task was to take the next step. And in the process, we may change what we think is going to happen, but we do it by taking these steps based upon what's there.


Ivan Sutherland understood that no matter how revolutionary your scale idea is, you need a path to get there. The answer is largely through small iterative steps. You need to build your creative environment around this process. That graduate course gave Ed not just an ambition, but a guiding principle by which to achieve it.


When I graduated, the most important thing I got out of it was that this environment was awesome. I loved it. And while I had this vision of making an animated film, and it was set the course of my life, the thing I wanted to do was to have this environment wherever I went. And that needed to be something that was a principle for me was how do you have this environment?


In 1974, Ed earned his doctorate in computer science. Within a year, he took on the role of director at the newly created Computer Graphics Lab. This was at the New York Institute of Technology, also known as New York Tech. Ed said about building his own creative environment. He took inspiration from his free-wheeling graduate school, but he also added his own elements.


Right at the beginning at New York Tech, we said, We're going to publish everything we do. It turns out the President of New York Tech was fine with that because the most important thing we can do is to be engaged with the community. If we're engaged with them, then we get the best people.


Many times being open is much better than being closed because what gives you your competitive advantage is not your hidden secret thing. It's the fact that you're in motion with a great team. Creative people are attracted to places where they can innovate. Publishing their cutting edge animation techniques sent out a clear signal that Ed was building an environment that made creativity its top priority.


We had some rather phenomenal people come in, but we were not in a community that really understood filmmaking and storytelling, and we knew that was one of the weaknesses.


So if the tech was so great, why not to share it with filmmakers?


No studio was interested at all in anything that computers might do. There was zero interest. They didn't even think it was relevant.


That was until 1977, when a set of events from a long time ago in a galaxy far, far away changed everything.


Star Wars is probably the single most impactful movie in the history of the motion picture industry. It really changed a lot of things.


One of those things was catapulting the bar from movie special effects. The spectacle of lightsabers and space battles had audiences thirsting for more immersive, mind-blowing sequences. To realize his vision, director George Lucas had set up his own special effects division, Industrial, Light and Magic, or ILM.


George was successful with this newly formed group of ILM who had just really basically taken special effects to a whole new level. George understood that technology was going to impact movie making. George was the first person with credibility in the industry who thought this was going to be important, and he was willing to fund it. This was pretty special.


George Lucas had intently followed Ed's work at New York Tech. Like Ed, George was frustrated at how slowly the film industry was adopting computer technology. In 1979, George recruited Ed to establish and run Lucas Films, Computer Division. It was another opportunity for Ed to build a creative, dynamic environment from the ground up. Again, he planned to build on what he had learned at graduate school and New York Tech.


When I left New York Tech and now went to Lucas Film, I looked back at this period and said, Well, about half of my theories about how to get the thing I experienced at Utah worked, and half of them didn't work at all. Now I'm going to Lucas Film, I'm going to come up with new ways of doing things, and I'm going to hang on to the things at work.


However, Ed soon discovered something at Lucas Film. There's no such thing as a perfect creative environment.


One of the important realizations coming out of that was that I thought that that ratio about half right and half wrong would continue for the rest of my life. The value of it was that I knew that I was going to be wrong more than I thought I was. I thought that was, in retrospect, I think it was a benefit to think that because it's true.


Well, having read creativity, Inc, It's I think part of the model that I came away from that was that part of the goodness of the mindset of being half right and half wrong is its dynamic. It's focused on learning. It's focused on iterating to the next play. I presume that's what you mean here by that principle guiding you through life about being half-right and half-wrong.


That is what it's about. When you do something that's new by virtue of the fact that it's new, it means you haven't done it before, then you define yourself in terms of being a leader who gets it right the first time, and it's like your ego gets in the way. That process of doing something new is an iterative process, and it requires a lot of people. The most damaging thing is if the leader thinks their job is to be right and to know the answer, you're shutting things off when you think that way. I don't know. Let's work it out together. We're all in this together.


Ed brought this collaborative approach to his work at Lucas Film. He and his team set about applying increasingly powerful computer technology to special effects. One major project was a specialized machine that could digitally combine special effects with live-action footage. They named it the pixel image computer. However, while George shared Ed's enthusiasm for using computers in movie making, he didn't share Ed's ambition to create a full-length computer-animated movie. Meanwhile, Lucas film was put under financial strain by George's 1983 divorce settlement. Although Ed's computer graphics division was making huge strides in technology, it wasn't making money for its parent company, so George made the decision to spin it off.


Honestly, it was a brutal year. High stress, things were not going right.


Ed was desperate not only to find a buyer, but a buyer who would understand and preserve the dynamic approach to creativity that Ed had built. It turns out that just such a buyer was currently on the lookout for new opportunities, having recently parted ways with a computer company he'd founded. The company's name was Apple, and that buyer was Steve Jobs. We'll hear that story and more after the break. We'll be back in a moment, afterward from our premier brand partner, Capital One Business.


I ended up having my first child the September that we launched the diaper backpack.


We're back with Deepa Gandhi of Dagnedover. She's been telling us how they founded their business around a simple, straightforward idea; build a better bag for working women. But the founders' lives and their needs were changing.


We had parents on the team. We had friends that were having kids. We knew we needed to make a better diaper bag, one that was gender neutral because products should be designed for both parents.


Dagny Dover's neoprene diaper backpack was an immediate hit, but then something unexpected happened.


We saw people carrying it that were clearly not parents. If you remove the changing pad, you can use it for anything. Where we originally intended to put wipes in a post-COVID world, everybody's carrying wipes. One of our team's strengths is just being able to say, Well, if there's opportunity, let's run after it.


Dagnidover was rapidly expanding, but they were able to meet the challenge because they had a clear simple focus, says Lauren Tresco of Capital One Business.


Expansion is such an exciting time for business owners, but it can often create chaos or misdirection. Savvy entrepreneurs know how important it is to scale with intention and keep the simple story of their product top of mind.


Where would this expansion take Dagnidover? We'll find out later in the show. It's all part of Capital One business's Spotlight on Entrepreneurs, following Reed's Refocus playbook at all levels of scale.


We're back with pixel co-founder, Ed Catmull on how to keep the creativity flowing. Before the break, we heard how Ed found himself in the midst of a brutal year. Although his computer division at Lucas Film was making huge strides in technology, it wasn't making money for its parent company. So George Lucas made the decision to spin off Ed's vision. Ed was desperate to find a buyer who would realize the potential of what his team was doing and also let them preserve their dynamic, creative environment. After over a year of searching, they found their buyer.


Steve Jobs did believe that the potential for graphics was going to become important in the future. Steve wasn't saying, I know how to make a business out of this right now. This is going to be of value in the future, so let's figure out what we do to get there.


In February 1986, Steve Jobs paid $5 billion to buy Lucas Film's computer graphics division of 40 or so staff and establish it under a new name, Pixar. It meant Ed and his team were financially secure for now. The newly established pixel now desperately needed clients. It didn't take long for one of the biggest names in the business to come knocking.


This was Roy Disney Jr, Walt's nephew.


Roy had recently rejoined the Disney Company as Vice Chairman. Disney's output was creatively stagnating and its films were doing poorly. Roy was determined to inject some dynamism back into the family business.


Roy said he knew that Walt Disney believed that changing technology of filmmaking brought energy into the creative process. It wasn't in the rest of the company.


Roy was prepared to go to extraordinary lengths to reignite Disney's creative spark.


They wanted us to write software to color the cell's hand-drawn animation. Now, the truth was they did a financial analysis, and the financial analysis says there's no benefit to using computers. And Roy said, I don't care. We're going to do it anyway because we need that energy coming in.


Roy saw the shakeup as a vital, long-term creative investment, even if it meant taking a short-term financial hit.


And then as technology changed over time, we made sure their software continued to work. Essentially, we were building a level of trust with Disney as people who were going to stay with them all the way through to make sure everything worked.


The partnership to supply software to Disney was a creative success. However, Disney's main focus at the time was selling hardware, namely its specialist, PCR Imaging Computer. With an initial price tag of $122,000, the low volume of sales wasn't enough to keep Disney afloat.


It was difficult for Steve. We were costing a lot of money. We put together what we thought was a long-term plan because we knew that underlying this industry was the exponential change in computer power, and that the economics were not right and wouldn't be for several more years. But we had a plan to get ready for it. And Steve believed there was value in that. So he supported us as we did this, even though we were hurting on the business side. In the end, he actually did stick with us.


Part of Ed's long-term plan was to keep making short films along with commercials to showcase the technical and creative advances that Pixar was spearheading. In 1986, PCR released the animated short film, Looksoe Jr. It featured the desk lamp that would go on to become the company's mascot. It was also the first 3D animated computer film to be nominated for an Oscar. Then, 1988's Tin Toy won an Academy Award for Best animated short film. This caught the attention of Disney's partners at Disney.


Disney had already had this resurgence, so they were doing very well. They thought they would do some boutique films. So the President of Disney animations, Peter Snyder at the called me into his office and said, We'd like you to do a feature film. And I said, Well, we're not quite ready yet. We plan to do a half hour special first, and then we'll be ready to do a feature film. And Peter said, If you can do a half hour, you can do 75 minutes. And my instant reaction was, Yeah, you're right. So at this point, Steve recognizing the advantage that was there, came in and negotiated with Disney to do a three-picture deal with Disney.


Notice how Ed quickly overcame his initial reluctance to take on the making of a feature film so soon. It's easy to internalize arbitrary limits and restrictions that hold us back. You need to be able to quickly identify those self-imposed constraints and throw them aside. So in 1991, Disney struck a new deal. Disney would fund three Disney movies, which Disney would distribute and own. Now there was the simple task of making the film.


Inside of Disney, nobody had ever made a computer animated film before or anywhere. So none of us knew what we were doing.


There was much more writing on the film's success than Ed's ambition to make a feature film. Pixar was a loss-making enterprise. Steve Jobs had kept it alive through numerous cash injections. Steve was now expressing frustration at the situation. So failing now could mean the end for Steve's support, and by extension, the end of Pixar.


If we didn't get the film done, if we didn't solve the problem, then that was it. It was all over. And everybody knew it. So everybody had to figure it out with nobody having any experience whatsoever. And there was something about having to do that which was transformative to people. I've always liked this. Okay, don't forget that. Don't assume that you have to have all this experience to get something done. You get some smart people who are in the right art. They can do more than you expect.


Ed had faith that the dynamic, collaborative environment he'd built at Pixar would let them succeed, but he also realized they needed to set some constraints.


The film focused on toys because toys are all on flat surfaces and they're made of plastic, so it's easier to do. So some of what drove the topic was the limitations to what can even be done with computers at the time.


Pixel had its creative template set for the film and began developing a story. It would revolve around a toy cowboy named Woody, who becomes jealous when his owner gets a new toy named Buzz Lightyear. Disney greenlit the concept, but Ed and his team still had to manage Disney's expectations.


At Disney, all the films should be musicals with five to seven musical numbers and a funny sidekick. But there were certain things about that that just was not something that the people at Picture wanted to do.


Ed and his team were determined to hute to their vision. They spent over a year storyboarding the new film. But through those early drafts, they also took feedback from Disney, and the story and characters began to drift away from Disney's original vision. The creative crisis came to a head when they showed the first version of the movie to Disney execs.


The first version just didn't work. Even Roy Disney, when he looked at our first cuts, he'd say, Oh, this isn't going to work. This is bad. At one point, I get a call saying, You guys need more help. Move the entire company down to Los Angeles. This.


Ed declined the offer, knowing that inviting more help from Disney would dilute the dynamic, if unorthodox, creative process of Pixar. Ed also knew that this crisis point could actually fuel rather than deflate his team.


We knew it didn't work. If we don't turn this around quickly and demonstrate that it's going to work, it all falls apart. The team figured out a take that was theirs, and they turned around fairly quickly. In doing that, they also gained some confidence about what they wanted and what it meant to be a good filmmaker.


This is one of the key advantages of being prepared to constantly revise your creative processes. Your team knows that the one reliable constant is change. This will make them more resilient and adaptive when crisis hits. Ed and his team sprinted to overhaul Toy Story.


As we started to get near the end, it was then apparent that we had something which was really big.


There was another key person who shared their confidence.


Steve said, This is a big deal. This is actually really going to change animation.


In typical Steve Jobs fashion, he had an audacious plan that none of Ed's team saw coming.


We need to go public just that the film comes out.


To which Ed and his team had a response.


That's nuts. Let's do a couple more first.


Steve Jobs also predicted that a successful IPO would mean a change in the relationship for Disney with Disney and its then CEO, Michael Isner.


Steve demonstrated his brilliance and how he thought about this, which was that when the film comes out, then Michael Isner will realize he's just created his worst nightmare, because with two more films, the deal is over with. But now we're a free and independent company, and so we then become a competitor. So Steve said this is going to happen, so he will want to renegotiate.


But this didn't simply mean asking for more funding or film deals from Disney.


Steve realized that it wasn't a matter of getting a good deal over somebody else. You actually need to think of them as equal partners. In order to do that, we have to be able to put up half the money for the films so that we can genuinely say coming into the negotiation, we are partners at every level.


Steve knew that for the creative magic of Disney to continue to work, he needed to be on an equal footing with Disney both creatively and financially.


So sure enough, when the film came out, it was a big success. One week later, we went public.


Toy Story was a creative triumph, and investors flocked to Disney's stock. The listing raised $140 million for Disney and beat Netscape as the biggest IPO that year. Steve had been right about the appetite for Pixar Stock after the release of Toy Story. He was also right about something else.


Sure enough, a few months later, Michael Isner wanted to renegotiate the deal. Oh, Steve called this exactly right. Right. That's impressive.


With the deal renegotiated, pixel was now in an equal partnership with Disney. Ed and his team set about working on their next films, A Bug's Life and Toy Story 2.


So we're drawing on things we learned from Toy Story, and again, trying to correct the things that were wrong and then making a new set of errors.


Ed needed to quickly scale up his team while keeping the high level of creativity that had made Toy Story such a success.


This particular group that had made Toy Story was extraordinarily good at helping people solve problems. So we called it The Brain Trust.


The creative team behind Toy Story couldn't simultaneously take the lead on Toy Story Two, A Bug's Life, and the other projects in development. So Ed developed a method for making that team's creative excellence available to the rest of the company. That's not to say production on Toy Story Two went smoothly. Far from it. You can learn the fascinating details from Ed's book, Creativity Inc. What I want to focus on here is how Ed and his team iterated on what the brain trust was and how it operated as pixel grew and faced new challenges. One example is the composition of the brain trust.


So this brain trust actually morphed from an identifiable group into a way of thinking about solving problems.


The Brain Trust roots lay in the original creative team behind Toy Story, and initially it was made up of those specific people. But keeping it that way would have been impractical as pixel scaled. So instead, the Brain Trust became a method rather than a group. It became a way of sharing candid and objective criticism with directors and their teams every few months during a production. Over the years, the precise way The Brain Trust operates has changed, but some basic principles have emerged.


One of them is that this really needs to be composed just to filmmakers, like their peers who are talking with each other. Another principle was you just have to be truthful. The other one was a recognition that the directors know they have a problem, so they're a little bit vulnerable.


The next principle is one you should file under genius creativity hack.


We had to remove the power from the room. So people who were powerful were not supposed to talk for 15 minutes. Because if a person with authority starts the room, then everybody lines up behind that. The agenda has been set. If the person with power doesn't say anything, then entering the discussion has an entirely different dynamic. The brain trust, what they were supposed to do was to point out the problems, discuss it, make suggestions, but they couldn't tell people how to solve the problem. They couldn't override the director. And all this, frankly, was just to get it so that the director was free to listen to what was being suggested.


For Ed, the Brain Trust is all about sparking and sustaining creative magic.


For me, the magic means that people throw out ideas and they're not attached to them. If they help and they're accepted good, if they don't help and they're not used, that's okay too, because you're not attached to them. What we're trying to do is to figure out how to get more in the state where people are not attached to what they're saying, which also makes people more likely to listen, and it just changes the dynamic of the film. So that's an ongoing process.


Notice how at the root of all of these principles is the drive to share honest and constructive opinion while also making sure people still feel secure in their roles. This is something to keep front of mind as you iterate on your creative process. You want to encourage candid feedback in order to learn and get better, but you need to make sure that feedback is given with compassion. If your organization has a culture of aggressively shooting down imperfect ideas, then people will be less likely to give voice to their thoughts. This will have a chilling effect on your team's ability to learn, be bold, and experiment. I asked Ed to go into more detail about the challenges TikTok faced when it came to scaling the creative process. Well, one of the things that I think is part of the amazing story about what you led at TikTok is how to systematize an environment where you have creative solution to unknown problems as you're encountering them. So brain trust is one of the things. One of the other things that then made that scale and repeat process with pixel.


We went through a process of growing our output. Frankly, growing our output was very difficult because we had to figure out what are our bottlenecks. There are so many unknowns that are going on. We have to approach each problem as something that's new to us. Why is it not working? What are the obstacles? What are the impediments? There aren't really any fast answers. Most problems actually require going down a few levels just to understand them and pick up the problem.


Botanyx can be hard to spot, especially as you scale, but it's important that you do spot them and resolve them. They're a sign that there's a deeper problem with the processes you've established in your company. Some of these will be conscious processes that you set up for a very good reason but have now outlived their usefulness. Others will be things you do unconsciously that have become an unnoticed part of your culture. Either way, once you identify them, you need to change them. But be aware, the better you get at identifying bottlenecks, the morial spot, something Ed knows full well.


We put together a culture that was supportive that other people owned the problem. So if you walked into a meeting with people, they weren't saying, Okay, who's going to solve this problem for me? Or, Who's responsible for this? They all owned it. And it's a different discussion when everybody owns the problem.


This will also make for an environment in which people will proactively identify problems. Just as importantly, people won't be afraid to give input on your decisions. Of course, owning the problem is just part of the challenge. You need to be able to act quickly to solve it. I asked Ed how to do this as an organization scales. What are some of the ways that you try to keep the organization and the leadership and the problem-solving nimble to that next problem and realizing the game would be constantly changing?


In the case of nimbleness, it turns out that different groups have different notions of how to be nimble. I like the fact they've got their own approaches to it because they're going to bring something to the table without a notion that is always going to be uniform across the company.


In 2006, Disney acquired Pixar for $7.4 billion. Ed remained President of Pixar and also became President of Walt Disney animation studios. It was one of the many title changes across management that signaled a closer merging of Disney and Pixar, including Steve Jobs taking a place on the Disney board of directors. There was a clause in the deal guaranteeing that pixel remain a separate entity. Ed believed this stipulation was vital in preserving pixel's dynamic approach to creativity, although with some important guidelines.


You could not do production work for the other. But on the other side, you could beg, borrow, and steal ideas from each other because we did not want them to be an existential threat to each other. We wanted them to have a good relationship and want the others to succeed and to feel ownership that they fix their own problems.


This helped Pinterest's culture of constant refinement spread across all Disney's filmmakers.


Which then includes ILM and Marvel in terms of the sharing of information. An industry that's changing quickly, as this one is, we're far better off if the individual studios can actually bring their own view to it and move quickly and not become ponderous because we've merged everything together.


The conventional move would have been to merge those different production units to save overhead. But Ed knew it was incalculable value in preserving the different creative approaches of Disney, Pixar, Marvel, Lucas film, and others while still encouraging them to reach out to each other for help.


They just call up their counterpart at the other place. They'll give an idea, they'll say what they're doing, and we ended up with this really healthy ecosystem and it worked. I feel very proud about that.


As your organization scales, there's a tendency for silos to form, visions to narrow in scope, and layers of management to pile up. But that's precisely why you need to instill a willingness to constantly reassess and retool your creative process. It will help you cut through all these layers, short circuit, creative blocks, and clear bottlenecks. You'll just need to accept one thing.


There isn't the recipe. There isn't that sweet spot, and you get there and you've made it. This stuff is fundamentally unstable. There is no stable point. You have to keep doing this over and over again, and it's always different. You get on a path and you really commit to it. But while you're committing to it with passion, if it doesn't work, you change.


I'm Reed Hoffman. Thank you for listening. Now, a final word from our premier brand partner, Capital One Business.


If you told us when we launched the brand that men would make up currently 30 % of our customer base, I would actually say that feels right because I think our thesis always was like, you can do Dagene for everything.


We're back one more time with Deepa Gandhi of Dagene Dover. She was telling us how their gender-neutral, neoprene typer bag became a surprising hit with people who weren't parents. That got them thinking about further expansion.


Men were like, Can you make a Dagni for me? They love the material, right? It's super athletic. It's technical. Men really like that.


But Dagni Dover didn't launch a line for men. Instead, they rethought their entire brand identity. Any bag could be carried by anyone, and with that, they stayed true to telling a simple, clear story, says Lauren Tresco of Capital One Business.


Deepa and her co-founders did something being really smart. They didn't stray from their core mission by doing too many things or chasing trends. Instead, they doubled down on the simple product that their story was built on.


Dagnetover is scaled rapidly by broadening their customer base without overcomplicating their products or their story.


The one thing that has never really shifted, our TrueNorth was building this great brand and have a great high-quality product and a loyal customer base.


Capital One Business is proud to support entrepreneurs and leaders working to scale their impact from Fortune 500 to first time business owners. For more resources to help drive your business forward, visit capitalone. Com/business-hub. Again, that's capitalone. Com/business-hub. As with every ad on Masters of Scale, the entrepreneurs you just heard from were real and unscripted. Because Capital One is a financial institution, it's important to them to be transparent about the relationship with the entrepreneurs we interview. Some of these entrepreneurs are Capital One customers, and some aren't. Capital One did compensate all of them for participating in this campaign.


Masters of Scale is a wait-what-original. Our executive producer is Chris McLeod. Our producers are Chris Gautier, Adam Skuz, Alex Morris, Tucker Lurgersky, and Masha Makotunina. Our editor-at-large is Bob Safian. Our Music Director is Ryan Holiday. Original music and sound design by Dorado Rivera, Ryan Holiday, Hayes and Nate Kinsella. Audio editing by Keith J. Nelson, Stephen Davies, Stephen Wells, Andrew Nolt, and Liam Jenkins. Mixing and mastering by Aaron Castinelli and Brian Pugh. Our CEO and chairman of the board is Jeff Berman. Masters of Scale was created by June Cohen and Darren Trif. Special thanks to Jaudine d'Orsee, Alfonso Bravo, Tim Cronin, Erica Flint, Sarah Tarter, Kitty Blazing, Mariel Karecker, Chinima Reziquena, Colin Howarth, Brendan Klein, Samio Putta, Kelsey Cezon, Louisa Velaz, Nikki Williams, and Justin Winslow. Visit mastersscale. Com to find the transcript for this episode and to subscribe to our email newsletter.


Chatgpt. I produce a podcast called Masters of Scale, and I'm looking for a way to get listeners to leave us a five-star review on Apple Podcasts. Do you have any suggestions?


Absolutely. One effective way is to engage with your listeners directly during your episodes. Remind them how much a five-star review can support your show.


What about to try to convince listeners to share one of their favorite episodes with somebody in their life? Do you have any suggestions for that?


Certainly. People love to share content that has made an impact on them. So remind your listeners how sharing an episode can start meaningful conversations with friends or help others discover insights they've benefited from.


Would it be okay if I use maybe our conversation as a segment on the show?


That sounds like a creative approach. Using a meta conversation about engaging your audience as a segment could be quite engaging.


This is executive producer Chris McCloud, and I urge you to take ChatGPT's advice and leave us a review on Apple podcasts and share an episode with a friend. It really, really helps.