In a world where we’ve gotten more cynical about technology there’s something pure about Pixar that people trust, says former CFO Lawrence Levy. With 29 films over 30 years, the company has never compromised in striving to entertain families in a wholesome way. But, in the early days, Pixar almost didn’t make it.
On stage for CHM Live on November 20, 2025, insiders told the behind-the-scenes story of how Silicon Valley investment bankers rallied around the struggling company next door. They wrangled founder Steve Jobs and manufactured an improbable IPO that rescued Pixar and delivered the first feature-length, computer animated film—the beloved Toy Story. The program was made possible by the generous support of J.P. Morgan.
Moderator Paul Noglows, formerly of Hambrecht & Quist, is cowriting a book with JP Mark, formerly of Robertson Stephens, on the two companies, which, along with Cowen, were the investment banks behind the Pixar IPO (initial public offering). He opened the discussion by asking Levy what it was like at Pixar in the spring of 1995, less than a year before the IPO.
Levy had arrived at Pixar in late 1994 and quickly realized the company was doomed. It was facing three major challenges. The first was Steve Jobs, who was at a low point in his career and as difficult as ever. The second was that Pixar had no business, profits, or money. Despite their groundbreaking RenderMan graphics software, Jobs was covering payroll with personal checks. The third problem was that the company had signed a crippling contract with Disney.
Lawrence Levy unpacks Pixar’s contract with Disney.
Although Pixar was in dire straits, Steve Jobs had aspirations for it to go public, and he wanted Morgan Stanley and Goldman Sachs to underwrite the IPO. But the investment banking behemoths immediately saw that the company did not have “up and to the right” growth potential and declined to invest.
So, with Jobs’ begrudging agreement, Levy took the deal to his “local heroes at Robertson Stephens.” Former President and CEO Michael McCaffery remembered that it was hard to figure out who on staff could check out a company that wasn’t like anything on their typical list of semiconductors, software, computing systems, and communications. They, too, realized the numbers weren’t there, but that didn’t scare them. And when they saw what Pixar was doing, they were excited.
Cristina Morgan, the head of technology investment banking at Hambrecht & Quist at the time, also went down to see Pixar. As a Board member of Steve Jobs' NeXT, CEO Dan Case had told Jobs that H&Q would play any role he wanted them to in an IPO. Like H&Q, she, too, was impressed with what she saw at the Pixar studio.
Cristina Morgan describes her first visit to Pixar.
The bankers knew they were taking a risk with Pixar, but they believed that Pixar’s first movie, Toy Story, was worth betting on.
With the investment banks on board, the Pixar team had to finish Toy Story, and that was a nearly impossible task from a technical standpoint. Everything in the movie was set in rooms inside a house because computer graphics could do boxes. They didn’t know if they could even make an outdoor scene. And they only had a matter of months before the film's scheduled Thanksgiving release to figure it out.
Then there was the challenge of deciding when the IPO should happen. If they did it after a successful movie release, they could be accused of hyping the stock. If they did it after, and the movie was a flop, they could be accused of duping investors. And, of course, if the movie flopped, Pixar was dead.
They decided to move forward with the IPO, and Steve Jobs set out on a three-week “road show” to pitch the company to potential investors. Cristina Morgan and Mike McCaffery went along. Picky about everything—from the hotels to the food and every detail in between—Jobs created plenty of difficult moments.
In New York City, potential investors were invited to a rented theater in the Upper East Side and told to bring their families to view Toy Story. To sweeten the pot, they offered free candy. The events were designed to, in Mike McCaffery’s words, “create the sugar high of all time.” After New York, the road show was supposed to go on to Boston for a breakfast meeting with investors. But there was trouble.
Mike McCaffery tackles a snowstorm for Steve Jobs.
While the investment bankers knew that Pixar’s future depended on Toy Story’s opening box office success, Levy says that he and Jobs worried about beating the stock price that had been set. No one knew if investors would pay $22 per share, and if Pixar wasn’t “oversubscribed,” the IPO could be deemed a failure.
And, of course, Jobs felt that Disney was not doing enough marketing and everything they did do was terrible. He was on the phone telling a company that had been releasing movies for 50 years how it should be done. The stress was getting to everyone.
Toy Story opened on Wednesday, November 29, 1995, on the night before Thanksgiving. It made $29 million its opening weekend and went on to become the #1 film in the US. It was the first non-Disney animated film that was a blockbuster.
The IPO happened a week later, and shares closed at $39, up 78% from the offering price. Jobs’s 80% stake was worth over $1 billion. Everyone involved could enjoy the success. Morgan recalled the incredible talent, and the artistry of the revolutionary graphics and technology. She said that it was striking how different and compelling Toy Story was and that without the movie’s magic there would have been no IPO.
Although the stock price had dropped to $12 three weeks later, Pixar’s IPO had been a success as well as something of a miracle. Morgan credits the investors for their long-term vision in seeing the company’s potential. And Toy Story’s success allowed Levy to renegotiate the terrible Disney contract.
Twelve years after Levy arrived at a company with a negative retained earnings of $50 million, Pixar was sold to Disney for $7.6 billion. He recalled “walks and talks” with Jobs to make decisions and appreciated that Jobs was always more interested in getting to the right answer than in being right. After Pixar, Jobs returned to Apple in a remarkable comeback story that resulted in the revolutionary iPod and iPhone.
To Infinity and Beyond | CHM Live, November 20, 2025
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