Phil12
Well-Known Member
You have fallen for the myth of Walt Disney. In reality TWDC went public in 1940. They had to go public because they lost so much money on Pinocchio and Fantasia. And Walt liked the idea of using the money of other people to finance his projects so that he could insulate himself from the risks. By 1952 he created WDI (later known as WED and then RETLAW) which was his private company. He used his private company (which he kept secret from all shareholders) to siphon off money from the public company and enrich himself and his immediate family members. Roy never participated in the deal because of its illegality. And Roy was later proved right when Walt was forced to settle up (or potentially go to jail) with the public company. The settlement came just about a year before Walt's death. Roy and Walt had a bitter dispute about Walt's unethical and illegal behavior for about two years prior to the settlement. They didn't speak to one another during this time period!From everything I've read about Walt, though, he wanted to make money so that he could continue to explore and innovate and pursue his passions. The company came close to insolvency several times because, well, innovation is expensive and risky. Luckily, Walt was right more often than he was wrong and was a good judge of what would be popular with the masses. It was Roy's job to find the money to fund Walt's ambitions. It's a miracle Roy outlived Walt. It was a privately-held company while Walt was alive, so there wasn't the same kind of pressure to consistently increase the value of the company. It just turned out that Walt and Roy were really good at not only keeping the company going, but growing it along the way. Once it was no longer a family business and went public, it became all about creating things in the service of making money as opposed to the other way around.
I don't see that there was any way they could have avoided going public as Walt was the company and, once he was gone, the company started a downhill slide. The parks continued to make money, but by then Disneyland had been a success for over a decade and WDW was being built and would, in many ways, copy what had already been done out in Anaheim. The movies quickly began to lose money because they were not adapting to the changing culture and Walt wasn't there to help them evolve. EPCOT Center was amazing and successful, but expensive. Revenue from the films was no longer enough to shore up the foundation of the company. Love him or hate him, but Eisner (and Frank Wells) saved Disney. To do so, however, Disney had to become Disney®. There was no going back. I'm just glad I was able to experience WDW when the dreamers were still in charge, even if they were rapidly fragmenting and heading towards a brick wall. I just want the current company to actually care about what they're doing. It seems like fewer and fewer of those with any sort of power in the company do.
But make no mistake about the fact that Walt was amassing a huge fortune for himself. Had either the production company or Disneyland failed (or both), Walt and his family members were completely insulated against monetary loss. The key for Walt was his absolute identification with the company. Had any scandal gone public about Walt, it could have very well brought down the entire public part of the company. That's why Walt Disney Productions (public company) was willing to settle with Walt rather than go to court to sue him. Any court battle would have been on the public record. Walt's huge diversion of money from the public company to his private company (and other unethical practices) would have been in all the newspapers. Instead, they conducted a private settlement so as not to blemish Walt's name. And, after all, Walt's name is at the heart of the company. Therefore it has also been a top priority to keep Walt's memory alive as a genius saint rather than document his underhanded and unconscionable business practices.