Disney Fired Him. He Built DreamWorks, Shrek, and a $3.8B Empire | Jeffrey Katzenberg

David Segal (00:00:00):
That was legendary.

Harley Finkelstein (00:00:01):
That was legendary. So you know this well, but the audience doesn't. I've been trying to get this next guest on Big Shot pretty much since day one and it finally happened and I will say it was well worth the win.

David Segal (00:00:13):
It did not disappoint. I mean, first of all, I mean, this guy is not only a legend in the movie business, but he was part of the greatest partnership in the history of movies.

Harley Finkelstein (00:00:24):
I mean, Dreamworks was ... We all kind of know their movies. Obviously he talks about the making of Shrek. We talk about the lessons from Walt Disney. Imagine working for Michael Eisner and Barry Diller. Imagine getting fired. I mean, the whole thing is just incredible. He talks about failure can't be fatal and the idea that some failure is important, but you have to kind of have it measured.

David Segal (00:00:50):
And don't let your memories be greater than your dreams.

Harley Finkelstein (00:00:52):
Well, that was so interesting. We kept asking him, "What about this thing and that thing?" And he keeps kind of going to the future. And this is someone who, his past is full of incredible success and yet all he wants to talk about is the future. One of the crazy stories that we heard is that he got very publicly fired from one of the most iconic CEOs at one of the most iconic companies. Rather than licking his wounds or feeling bad for himself, within two weeks, he goes to create one of the greatest partnerships of all times with two of the most unbelievable people in the world, Steven Spielberg and David Geffen.

David Segal (00:01:29):
I mean, this man curated most of our childhoods. I mean, Beauty and the Beast, Aladdin, Lion King, Shrek. I mean, the list of hits just goes on and on and on. And the lessons and how self-reflective he is, I mean, it was just an incredible

Harley Finkelstein (00:01:43):
Interview. And it wasn't just about necessarily Hollywood or about movie making. He talks about his father and watching his father as a kid, the way he used to tip everyone and make everyone feel special. He talks about that you cannot live if until you actually learn how to give. He talks about the difference between an entrepreneur and a builder, which seems subtle, but so fascinating. We go through everything from parents, Jewish culture, getting fired, creativity, Hollywood, Silicon Valley, finance, empathy. But you can tell we're jazzed up about this one. We are jazzed about this. Ladies and gentlemen, the one, the only, the legendary Jeffrey Katzenberg.

Speaker 3 (00:02:22):
Started from the bottom now here. Start in front of bottom now. Started from bottom now here. Started from the bottom now team.

Harley Finkelstein (00:02:37):
We had read in our research that you sort of credit your dad for your hustle and your mom for your creativity. Talking about your dad for a sec, growing up, that hustle, was that entrepreneurship or was that a different type of hustle that you remember?

Jeffrey Katzenberg (00:02:53):
Have you ever thought about the thing that you like most about yourself? No. Okay. Well, I have to start by also just telling you for purposes of this is that you probably heard this. I don't reminisce. I'm not nostalgic.

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And I sort of have as my mantra or philosophy, a very simple thing that I live every day, which is never let your memories be greater than your dreams. Now, I can tell you if you can find that place for yourself in your life, particularly if you have lucky enough to have success along the way and to always be living for what's next and tomorrow and the next challenge, next opportunity, and not to live in the past is literally maybe one of the greatest blessings in life. And so because of that, I'm not that good about reminiscing and you guys are now going to ask me to reminisce like crazy and I'll do my best. Sure. But because I was asked this maybe a month or so ago, I thought about the things that I like most about myself. And rather than tell you what they are, I'm going to tell you the two people who taught me that about those things that I adapted for myself.

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So one was my dad. So he was a very successful stockbroker in New York. We grew up on the Upper East Side and went to private school, basic goldspoon.

Harley Finkelstein (00:04:27):
Did you feel rich as a kid?

Jeffrey Katzenberg (00:04:28):
Yes.

Harley Finkelstein (00:04:28):
Okay.

Jeffrey Katzenberg (00:04:29):
Oh yeah. I mean, because he was a almost like GazCS

Harley Finkelstein (00:04:34):
Character,

Jeffrey Katzenberg (00:04:34):
Three-piece suit, the watch.

Harley Finkelstein (00:04:36):
And when he went to restaurants, they knew him.

Jeffrey Katzenberg (00:04:38):
Well, that's where the story's going to go. And so when I was about seven or eight years old, I noticed that every time in the morning when he would get dressed, he would put a wad of hundred dollar bills in his pocket, brand new hundred dollar bills in his front pocket. And then everywhere he went in the course of the day, anybody that did anything for him, he would give him a tip, but he would fold it and they wouldn't know how much- $100

Harley Finkelstein (00:05:06):
Tip.

Jeffrey Katzenberg (00:05:06):
Right. So I watched this

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And I finally, as I said, when I was about seven or eight years old, it was that my curiosity got the better of me. And I said, "I don't see other people doing this, explain it to me. " And he says to me, "Have you ever looked behind us?" And I went, "No." He said, "Well, tomorrow when we go out, I want you to look behind us. I want you to tell me what you see." Okay. So the next day we go out and every time I look behind us, and whether it's a kid playing a guitar on a street corner, a busboy clearing a table, you name it, somebody opens a door for him, they all get this folded into a quarter, a tip. And I see, and I remember the word because it's not the word that I think one might necessarily think, which is, I said, I see happiness.

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Not that I see a smile, because it was a smile, but I saw more than a smile. I saw joy. And he said, "That's right." And he said, "So let me just tell you, I believe in taking care of those that take care of me and those that cannot take care of themselves." Now, the punchline of that is $100 in 1958 is $1,100 today. So you think about this, and by the way-

Harley Finkelstein (00:06:22):
A busker, a doorman. I mean, that is wild.

Jeffrey Katzenberg (00:06:24):
And by the way, 10 or 12 times a year, I mean today, 10 or 12 times, which you take that over a year, is millions of dollars in tips. That was his way of giving. We'd go stay in a hotel and we'd be in a hotel room for four nights. There'd be $400. It's like every night where you and I would whatever. And so that's the first one, first lesson for me, which was that I like about myself because I have found my version of that today. The specifics are not important other than I take care of those that take care of me and those that canno take care of them.

Harley Finkelstein (00:07:01):
Do you do it in a similar fashion to your father?

Jeffrey Katzenberg (00:07:03):
Yes and others

Harley Finkelstein (00:07:04):
Because

Jeffrey Katzenberg (00:07:05):
Today cash doesn't do it. And so if you ever walk into a restaurant with me of any place in this town or any place that I go to with any kind of regularity, Bill's never arrived. So it's all done- Behind the scenes. ... quietly. And they all know it now. So it's just like when I come in the waiting staff, they all light up. They're happy to see me in this, which is part of what he liked, which is that it made him feel great wherever he went. Do

Harley Finkelstein (00:07:34):
You have the same sense of instant gratification that the $100 bill provided? Because that's a little bit of like the marshmallow test. You're getting it right

Jeffrey Katzenberg (00:07:43):
Away. Yeah. I don't care. I know I'm giving happiness and joy to somebody in a material way that literally is going to make a difference to them and it makes me happy. So just to answer the finish the sentence is Kirk Douglas. So again, right around the same time, I don't know, 1958, 1959, something like that, he makes a movie called Spartacus. You guys are familiar with it. But when it came out, that was the equivalent of Batman, Superman, Spider-Man all rolled into one. This was the hero's journey and it was an epic movie. And I went to see it on Broadway and a big theater. And so the whole experience was epic. And he was like the hero of that moment in that time. 30 years later, I'm at Disney and I'm making a movie called Tough Guys, which was the last movie that Kirk, Douglas and Burt Lancaster did together with one another.

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And because they were in their late 70s, mid to late 70s at time, in order to get insurance, they had to agree that every day on their lunch break for 90 minutes, we had to provide a trailer there for them and they would go lay down and nap. So one day I say to Kirk, "I'll come over and I'll grab a quick sandwich with you before you do it. " Okay. So I go over to his trailer and I knock on the door. And as I'm coming in, this army of engineers and blueprints and got hard hats and vests are coming out of there. I mean, literally like 10 of them. So they're all piling out and I'm going, "I'm just curious, what was that about? " And he said, "Oh, I've been doing this program. My wife and I, over the years, every year we rebuild a bunch of playgrounds at public schools here in the city of Los Angeles." And I said, "Really?" He said, "Yeah, yeah." He said, "The never have enough money in their budget.

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That's always the first thing that gets caught. And I think that's such an important thing." I said, "Well, I actually have never heard anything about it. " And he said, "No, we're very, very quiet about it. " And they were doing, I don't know, 10, 15 of these things every year, like 25,000, 50,000, every year. And they'd been doing it for 10 or 20 years, I mean, a long time. So I said to him, "Okay, well, can you explain to me why?" And he said to me, the most important words any person has ever said to me in my life, he said, "You haven't learned how to live until you learn how to give." And when those words come from Spartacus, you don't forget them. And so if you asked me what are the things that I like most about myself, there are these two people in my life who gave me generosity,

David Segal (00:10:23):
Taught

Jeffrey Katzenberg (00:10:23):
Me about giving.

David Segal (00:10:25):
In order to give, you got to get, you have to make. Oh, yeah. So when you saw your father going back to that moment where he was handing out the $100 bills, did your ambition kick in? Were you like, "I'm going to be somebody who has enough means to give back at that moment?"

Jeffrey Katzenberg (00:10:37):
Too young. No, but I was always industrialist and I was always doing the lemonade stand. And again, acorn doesn't fall far from the tree. My father was a extraordinary gambler in everything, anything. What do you want to bet? He was Polymarket and Kashi before they existed. He'd bet on everything, anything- And

Harley Finkelstein (00:11:04):
That was his enjoyment or that was sort of his craft? Both. Okay.

Jeffrey Katzenberg (00:11:07):
Both.

Harley Finkelstein (00:11:07):
He loved it.

Jeffrey Katzenberg (00:11:08):
Yeah. He was

Harley Finkelstein (00:11:08):
A

Jeffrey Katzenberg (00:11:08):
Gambler. And he had a seat on the New York Stock Exchange. What is that? You're gambling. You're betting on your- At scale,

Harley Finkelstein (00:11:15):
I guess.

Jeffrey Katzenberg (00:11:15):
Yes, that's right. Literally. Right. And therefore it was in my life and in my ... So I kind of did the same thing.

David Segal (00:11:24):
But I mean, you were 14 years old. You end up in politics working for-

Jeffrey Katzenberg (00:11:28):
Well, so I'm at summer camp and I'm gambling and which you're not allowed to do because I hurt my knee and I couldn't go out and everybody was in. It was a rain day and this. And long story short, they come up with a stupid punishment for me, go stand by a flight ball. And they go, "Excuse me. I have a dislocated knee. I'm not standing by a flag ball." Well, if you don't do that, then we're going to have to put you in isolation. I go, "You know what? I'm done." And by the way, my father wouldn't talk to me for weeks after that because he was so embarrassed that I got thrown out of summer camp, literally. Come home and I go volunteer to work for John Lindsey who was running for mayor in 1965 and I'm 15 years old.

Harley Finkelstein (00:12:07):
That wasn't necessarily a normal thing to do as a 15-year-old.

Jeffrey Katzenberg (00:12:10):
No, but I just heard that's where people were going and hanging out and-

Harley Finkelstein (00:12:14):
Interesting.

Jeffrey Katzenberg (00:12:15):
And so it was not this happy accident as opposed to I was interested in politics. He was the congressman for my district and where I lived. And so I was aware of who he was and that he was running for mayor, but I just heard all that kids were all hanging out during summer.

Harley Finkelstein (00:12:33):
She went there as well. Before we go there, just go back. You said you're at 50 now. Go back to you're 13 years old. You didn't have a bar mitzvah.

Jeffrey Katzenberg (00:12:39):
No.

Harley Finkelstein (00:12:39):
Which is- Well,

Jeffrey Katzenberg (00:12:41):
That's because I have fairly extreme dyslexia, and so learning is really, really hard for me, particularly reading. Math, I'm actually was always very, very proficient at, but reading was always very hard for me. And a second language was impossible for me. And so I was always terrible in French.

Harley Finkelstein (00:13:04):
Hebrew was out of the question.

Jeffrey Katzenberg (00:13:05):
Yeah. It was just not ...

Harley Finkelstein (00:13:07):
And nobody

Jeffrey Katzenberg (00:13:08):
Knew what dyslexia was at the time.

Harley Finkelstein (00:13:10):
So what was it? It was you're not smart? Slow. Slow.

Jeffrey Katzenberg (00:13:14):
Yeah. And so I struggled. I struggled in school and I realized, okay, well, this is just another place for me to struggle and like-

Harley Finkelstein (00:13:21):
No way.

Jeffrey Katzenberg (00:13:22):
I can't do

Harley Finkelstein (00:13:22):
It. Did you feel ... I know you were religious, but was the Jewish culture in your home, was there Shabbat, stuff like that at the house?

Jeffrey Katzenberg (00:13:30):
From time to time. Not with the sort of regularity to it. I think they were casual in this. I mean, for the holy days and all of that, we would go to Shul and stuff like that, but it was not a part of the fabric of our daily life.

Harley Finkelstein (00:13:50):
So you not having moments that wasn't that big of a deal for you at the time?

Jeffrey Katzenberg (00:13:54):
It wasn't for me and my parents seemed okay. I mean, I don't know. I think part of the blessing is my parents got me really early. And they just understood that I very headstrong, overly confident.

Harley Finkelstein (00:14:17):
Which is unique. I mean, I heard you read about your mom talking about the story of you asking for a rope and her saying, "Well, he always knew what he wanted." The fact that you wanted a rope and you don't care what they did with their gifts. It was like, you wanted this thing, that's all that really mattered. The

Jeffrey Katzenberg (00:14:31):
Kids are that way,

Harley Finkelstein (00:14:32):
Right? Kids are, but all kids are.

David Segal (00:14:34):
I mean, you have severe dyslexia. I'm surprised you were that confident, right? You would've thought as a young kid that actually stripped some confidence away.

Jeffrey Katzenberg (00:14:44):
Yeah. I'm a research primate in that. The things that you would think are more often than not, I think were sort of counterintuitive in this because I just always have had this boundless curiosity and ambition to just do things and determination and perseverance. And I always make this joke about dyslexia because dyslexia is where you interpose words and sentences and even letters. And so I always ... And by the way, so even today, I can't read off a teleprompter. If I do, it's just garbled. It's like I have to have a piece of paper and I have to have color coding and underlying and words can't go more than four across the page. I've learned how to ... You always take whatever that thing is, is your greatest liability and you figure it out. And we see it with other types of disabilities. So dyslexia is a type of disability, but I'm always amazed and I see it in the Paralympics we're about to go into.

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These people blow my mind about how they are able to just reconceive life with these disabilities that they have. It's pretty inspiring. My disability was around language. So I always joke that for my whole life, every time you have read NO, I've read ON. So I actually don't know what no means. I know no to me is on.

Harley Finkelstein (00:16:31):
Very valuable.

Jeffrey Katzenberg (00:16:31):
Yeah.

Harley Finkelstein (00:16:32):
It's very valuable. So this whole ... I want to come back to politics. So you're working at City Hall, do you love it? Is it something you thought, "Hey, I can do this longer term?" I'm

Jeffrey Katzenberg (00:16:44):
Like Pavlov's dog. Give me something

Harley Finkelstein (00:16:48):
To go- A

Jeffrey Katzenberg (00:16:48):
Challenge. Any

Harley Finkelstein (00:16:49):
Challenge. So you were agnostic to politics, you loved the challenge.

Jeffrey Katzenberg (00:16:54):
And that there were things that seemed difficult, if not improbable, if maybe even impossible. I live there. That's my home address. Improbable. Somewhere between improbable and impossible is where I most love to be. And so what I learned very quickly, and I became aware of it and the ability to express it much later in my life than I wished I had, but the characteristic has been there from day one. And it's become my, again, if one philosophy is about living in the future and the dreams, the other is tactical. And the tactical thing in terms of me that I have tried to pursue in every facet of my life, two words, exceed expectations. And so how does that translate? Well, it translates virtually every part. So if you go back to those early days, whether it was volunteering in the campaign and suddenly I managed to get 300 other preppy cool school kids to come in and I figured out, well, free pizza and sodas on a Friday night and put on great music and the Beatles, everybody's coming in to stuff envelopes and then go out the next day.

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And it became a party, right? Yeah. But the ingenuity around that was the thing that some, I don't know when, where and how the light bulb went off for me, but what it did is-

Harley Finkelstein (00:18:31):
You figured it out.

Jeffrey Katzenberg (00:18:32):
I know how to do it. I know what to do. And so that idea of exceeding expectations is that whatever my bosses have ever asked of me, any challenge they've ever put in me, my goal always is to do a little bit better than they thought and throw that in faster or more efficiently or less expensively or more theatrically the pizza. How are you going to go distribute a million pieces of literature? Well, I'm going to get an army together and this and to do it. So it was a creativity around all that. But what I realized is when I did things that it's like Barry Diller, I exceeded his expectations in different ways, in different times over the course of 11 years. And every time I would do that, he would say, "Okay, well, let me throw something else at you and here's another curve ball for you in this.

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" And I would say Barry probably had more confidence in me than I had in myself, which then put more confidence in me. So

Harley Finkelstein (00:19:38):
It's a

Jeffrey Katzenberg (00:19:39):
Flywheel. But then I went on to realize later, which is, okay, well, exceeding the expectations to your boss is one thing. And the next thing I thought about is that, okay, well, how do I exceed the expectations of people that I work with? And then how do I exceed the expectations of people that work for me? So those are three very different things, right? Somebody you work for, people that you work with, and then people that work for you. Most people start

Harley Finkelstein (00:20:06):
With the former only, like the boss.

Jeffrey Katzenberg (00:20:09):
No, mine was, well, you'll see this is it. And so I started getting actually quite tactical about it. And early on, I used to wear my watch on my right hand.

Harley Finkelstein (00:20:19):
Why is that? Well, I

Jeffrey Katzenberg (00:20:20):
Don't know. That was just the place I wore my watch. I just wear my dad wore watch, whatever. I don't know. I'm a lefty, so don't you usually wear it on that? Okay. Well, decades ago, I put my watch on my left hand. Why is that? Because every day, every time, pretty much anywhere I am, I have this thing on my left wrist, which doesn't feel like it actually fits there. And that's my tell. That's my reminder of like, okay, here's your next thing. You're going to walk through this door here and let's try and exceed expectations. It's literally-

Harley Finkelstein (00:20:53):
You're almost like exceeding expectations of yourself by putting your watch on. Well, this

Jeffrey Katzenberg (00:20:56):
Is just reminding me, don't forget that. It's like a part of every single day. I want to be reminded in everything I do, see if you can do a little bit better than is expected of you. So that then went on to, I started to think about it in terms of my kids and- How old

Harley Finkelstein (00:21:12):
Are your kids now?

Jeffrey Katzenberg (00:21:14):
43, like any minute they're about to have a birthday. And so because I worked crazy, crazy work ethic and all of that in it, what I realized is what I got to a great place with them was it wasn't the quantity of time, it was the quality of time when I was with them in this. And so I actually started to think of things to exceed their expectations. And so one of the things from the time they were, I don't, and they're twins, one and a half or two years old, where I could actually hold both of them at once. I had this ritual, which is every Sunday I take them to breakfast somewhere here and I always would take them to someplace different. So it was always, we'd get in the car, where are we going? Well, we're going to go IHOP. Okay, well, we do that.

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Okay, well then we're going to go to where like this little horsey thing in this and oh, let's go to the Bel Air Hotel who has the ducks. So you're going to the duck, the swans. So it was just this thing where I kept always, that was- Exceeding them. Sunday was an adventure.

David Segal (00:22:20):
Let's have a work ethic though for a second because you have a famous saying, which I love, "If you don't come in on Saturdays, don't bother coming in on Sundays." How has that evolved for you?

Jeffrey Katzenberg (00:22:29):
Yeah. I'll come back to that in one second here because I want to finish the exceed expectations. So the next thing is, is that I realize what you really want to do is you want to exceed the expectation of your customers. If you do that, and I used to then say to everybody, every time we would set out to make anything, any movie or animated or TV show or a Broadway show or merchandise or a promotional deal with McDonald's, how do we exceed the expectations? Because if you do that, you have extraordinary success. They will reward you. And frankly, that's how ultimately over years rebuilt the Disney brand and then built the Dreamworks brand. It was about exceeding people's expectations. And with that, they give you brand. Brand isn't something you get to declare for yourself in it. It's your customers.

Harley Finkelstein (00:23:25):
Your customer-

Jeffrey Katzenberg (00:23:26):
Customer says, "Oh, that's what it means to go to a Dreamworks movie." They tell you what they perceive. Now you can create to get to that, to lead them to that, but ultimately they're the ones that anoint you, knight you, gift you with that in it. And it's a high bar to get there. Well,

Harley Finkelstein (00:23:46):
It's interesting because you actually, Dave and I both have young kids. I can think about a Dreamworks movie. Shrek is obviously a Dreamworks movie. Just there's something about the connection. I don't know what is the characters, the character development.

Jeffrey Katzenberg (00:23:57):
Well, I'll tell you in a minute. So I started to realize, okay, exceed the expectations of your customers and everything comes your way. Every recognition, reward, financial, Oscars, you name it, it all comes with exceeding expectations. And then finally what I came to is, so I've been married for 51 years. The highest bar is if I can exceed the expectation of my wife. Really, that's a high, high, high bar to get to.

Harley Finkelstein (00:24:26):
How'd you figure that out?

Jeffrey Katzenberg (00:24:28):
It's pretty simple, actually. Again, it's interesting. Exceed expectations, two words, but underneath those two words, it's just a mountain of stuff to do and same

David Segal (00:24:38):
Thing. Well, exceed expectations. I mean, going back to that quote, if you don't come in on Saturdays, don't come back Saturdays. I mean, it comes with trade offs. If you want to exceed expectations, something else, it requires an immense amount of hard work and something else probably comes at the expense of something else. How do you-

Jeffrey Katzenberg (00:24:53):
So I'll tell you that, but I want to just again, because I want to

Harley Finkelstein (00:24:56):
Just-

Jeffrey Katzenberg (00:24:57):
We can jump around. It's fine. But just a marriage. Yeah,

Harley Finkelstein (00:25:00):
Marriage.

Jeffrey Katzenberg (00:25:01):
Pretty simple. Yes, dear. And you have to actually-

Harley Finkelstein (00:25:05):
Mean

Jeffrey Katzenberg (00:25:05):
It. Mean it. It can't be yes, dear. It's like she's the boss. Okay. In your lanes, in your world, you were going to run the show here in this and I'm good with that.

Harley Finkelstein (00:25:17):
In 51 years, she's been part of the ride. She knows that you're working on Saturdays.

Jeffrey Katzenberg (00:25:22):
She knows it all. Okay. So I arrive at Disney in 1984 with Michael Eisner. It's my first day at work. I go in there and I have my little list of the things that are sort of the priorities, but he and I had been talking about it for some time, so a couple months.

Harley Finkelstein (00:25:38):
How'd you meet Michael in the

Jeffrey Katzenberg (00:25:38):
First place? Barry hired him at Paramount, and I was there at Paramount. And so he came in as Barry's number two. I was down in the studio, so they were over all of Paramount, movies, television, everything. And I was in the movie part of the company. I moved to it. I was in a bunch of different things, but as I say over the years, but then I was in the movie part of it and Michael ran that directly, so he was my boss.

Harley Finkelstein (00:26:09):
And so when he left, he took you or you-

Jeffrey Katzenberg (00:26:11):
Yeah. Well, we partnered. We actually went sort of as a ... We sort of had a little cabal partnership that we're going to go do whatever next together. We were really, really good together. I mean, maybe like a great marriage that at some point you outgrow one another and they go off the track and this and that. While we were married, we were phenomenal. He made me better, smarter. I learned incredible things from-

David Segal (00:26:41):
With Frank Wells too, right?

Jeffrey Katzenberg (00:26:43):
Well, Frank was the marriage counselor between us. So as we got older, we needed somebody to broker stuff between us. So many, many brilliant things about Michael, also many broken things about him. But we had a really, really great partnership. Anyway, so I get to work on the first day. I go in my little buck sheet and here's my things to do. And we go through it and I just say, okay, these are the sort of priorities. Here I go. And he went, great, go get them. And I get up to leave his office and I'm at the door. I'm literally at the door and he says, "Hey, Jeffrey, one last thing before you go, I wanted to talk to you about it. " Okay, what's that? And he said, "Well, come over here. I want to show you something." So he's in Walt Disney's office, third floor of the sort of main building there overlooking the studio.

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And we go to the corner window and he says, "Do you see that building over there?" I went, "Yeah." He says, "Well, do you know what they do there?" I went, "No, I have no idea. What do they do there?" He says, "Well, that's where they make the animated movies." I went, "Oh, that's good." He said, "Yeah, and it's your problem." So that was my introduction to animation. I'd never made an animated movie before. I'd probably seen one or two of them as a kid, but I didn't know nothing whatsoever. And he was very explicit about, we have to go figure that out. The heart and soul of this company and the business is we got to refire up the animation of it. What

Harley Finkelstein (00:28:10):
Was the reputation of that Disney animation

Jeffrey Katzenberg (00:28:13):
Then? It was terrible. It was a disaster. Yeah. They had just been going downhill. And in fact, the movie that was there when we arrived was this movie called The Black Cauldron. And if you go look at sort of the filmology of the Walt Disney Studio and you just say, "I'm going to pick the ... " What is it? There's Nader and what's the opposite of it? I don't know. Anyway, so it's literally the lowest moment of both performance, but most importantly, if you actually just watch the movie, it's horrible. That's the movie that's nine tenths finished in production. We have inherited that. We have inherited that and have to go figure that out. In any event, they said, "Well, we have to make animated movies here and they got to be great." And so-

Harley Finkelstein (00:28:57):
What do you say to this?

Jeffrey Katzenberg (00:28:58):
I went, okay, that's what I do.

Harley Finkelstein (00:29:00):
Yeah, I've seen expectations.

Jeffrey Katzenberg (00:29:01):
Yeah. Okay, fine. I'll go figure it out. And so sort of two parts to that, which is, I can tell you how I figured it out, but I also can now go to your question here, which is we're at a studio, the part of the company that I had, which was movies and television, animation, Disney Channel, they were all hanging on for life. So that part of the company did about $200 million in revenue and lost $4 million. It was four million in the red that year that we arrived. So it was broke

(00:29:42):
And broke in and broke. And the big money machine was the theme parks were still doing great, licensing and merchandising, still doing great, but these businesses were a bust. And so a lot of change had to come pretty much of Across the board. And back then, I wanted people to go to the moon with me. We were on a mission. And I had twins that were two years old at the time, so I understood what it meant to have a family. And my family's always been important to me and I've always managed, not in the quantity, but in the quality of time there. It wasn't a trade off. And so for me, when I was hiring people to come to work there, I one day said, "If you don't come to work tomorrow, don't bother coming on Sunday." I meant it. I wasn't kidding. And if that's not right for you-

Harley Finkelstein (00:30:48):
That's great, but it's not the place for you. Don't come

Jeffrey Katzenberg (00:30:50):
Here. It wasn't a bad

Harley Finkelstein (00:30:53):
Thing

Jeffrey Katzenberg (00:30:53):
To-

Harley Finkelstein (00:30:54):
Although you showed up prior to you showing up, no one had that philosophy. No one had that hustle there.

Jeffrey Katzenberg (00:30:59):
Okay. No, but that was my work

Harley Finkelstein (00:31:01):
Ethic. Yeah, you're coming for change

Jeffrey Katzenberg (00:31:01):
Management. My work has to go back to 14 years old is like twenty four seven and improbable impossible. We're going to build this last place studio losing money. We're going to turn it into the number one studio and re-imagine the Disney brand or reignite the Disney, but whatever those things are. We were going to go to the moon. And I wanted people that wanted to be on that mission and was very clear that you had to be willing to give yourself twenty four seven to it. And at 30 years old, 33 years old, that's the time you do that.

David Segal (00:31:36):
Totally.

Jeffrey Katzenberg (00:31:36):
Not always.

David Segal (00:31:37):
Do you still feel that way? I mean, is that simply what it takes?

Jeffrey Katzenberg (00:31:41):
No, it got wiser.

David Segal (00:31:43):
How so?

Jeffrey Katzenberg (00:31:44):
Well, because just work smarter and better is part of that. It doesn't necessarily ... But it depends on the circumstances and depends on the thing that we're in pursuit of. And so yeah, when I did Quibi and hired all these 25 to 30 year olds, and we hired almost 300 of them, I literally, and during a different era, which was sort of this millennial group in this,

(00:32:11):
And who didn't want to have anything to do with that idea. And I just said, "Do not come." At that point, it was clear that if we were going to have a culture, which is really a Silicon Valley culture in Los Angeles and Hollywood, you had to be a flashing red light, sirens going off saying, "This is what it's going to ... " We are on a mission. We are a startup. We're going to doing something that is a high, high bar, and we have limited time to do it in. So it very much was a Silicon Valley venture startup mentality, which was not what Hollywood has, certainly not the creative storytelling, filmmaking part of Hollywood that was not in the culture of it. So I had to- I

Harley Finkelstein (00:33:00):
Mean, you had hired a Silicon Valley CEO with Meg.

Jeffrey Katzenberg (00:33:03):
Yeah. But I had to select, or the process had to select people that were as mission-driven and ready to give them selves at that moment in time. And we did. I mean, we had an amazing group of people and got a lot of great stuff done. Ultimately, it didn't work.

(00:33:22):
So now I go back to ... So to give you now, so that's the come work on Saturday, Sunday. But on the thing that ... So if I stood on the shoulders of my father and Kirk Douglas, on the storytelling side of my career, I stood on the shoulders of Walt Disney and Stephen Spielberg, and they were the two greatest influences for me. Now, Walt Disney had been dead 20 years when I got to the studio. You say, "Well, okay, how'd that happen?" Well, what was amazing is that he had this extraordinary archive of his work product, how he actually conceived and made, in particular, Snow White was one where he had literally documented every step along the way, copious notes, memos, typed, photography of him in his day-to-day process of walking through.

Harley Finkelstein (00:34:22):
Why did he do that? He wanted the archive? I don't know. He was dead.

Jeffrey Katzenberg (00:34:26):
Yeah. I mean-

Harley Finkelstein (00:34:27):
So you went deep on this archive.

Jeffrey Katzenberg (00:34:29):
Yeah. So there was this guy, Dave Smith, who was his archivist and was there for years afterwards who knocked on my door one day and said, "You may want to come take a look at some of this and you may find some ideas here that would help you. " And the thing that was extraordinary about it is that he really left breadcrumbs the size of Volkswagens. You just literally couldn't miss it if you wanted to. So- It

Harley Finkelstein (00:34:54):
Was almost as if he knew you were coming.

Jeffrey Katzenberg (00:34:56):
Well, somebody was coming, for sure. Right. Well, not even know I was coming, but someday somebody was coming. And so he left all of these things. And when I say them to you, you go, "Okay, well, geez, they really are pretty obvious and they're going to come circle back to you to Shrek." So the first one that he said, "I make movies for children and the child that exists in all of us." Okay, bang, boom, drop the mic, North Star. If you actually think about what he is saying and you go deep into that, it's literally, there's your pathway and there's your goal line. And I'll come back to that in a minute. He said, "My movies are only as good as their villains." Okay. I'm going to just say Ursula, Scar, Jafar, Farquhad, Tailong. I can go through every- They're incredible. Incredible. I've ever been involved with.

(00:35:57):
And the better the antagonist, the greater the challenge for the protagonist in it. And so, but he said it, "My movies are only as good as their villains, and so it's not an afterthought." Another wonderful thing that he said, again, seems so obvious and so simple, but maybe not to deliver on. He said, "There's no such thing as a great story without a great ending, so don't go try and figure it out later. You better figure that out before you get going. " It

Harley Finkelstein (00:36:26):
Was like first engineer from the ending.

Jeffrey Katzenberg (00:36:28):
Well, you better know what that is and it better be satisfying. You need to know where your goal line is. There are many of these little pearls. There's another one. So remember, animation is very much as a visual. It's not a verbal style of storytelling. It's animated. You're animating the visual, physical. He had a very simple line. He said, "If you can see it instead of say it, then do it. " So basically, the fewer words, the better. So if you can say things by watching action and reactions and all of that without actually ... The fewer the words you have, the better, the more successful you'll be. Particularly, remember, because these are movies being made for kids. So now I'm going to jump forward here. And so when we started Dreamworks, and particularly Dreamworks Animation, I was very conscious of not wanting to tread on what was obvious Disney territory.

(00:37:32):
And I'm confident that it was as much about ego as it was about ambition.

Harley Finkelstein (00:37:43):
Meaning you wanted to have your own thing?

Jeffrey Katzenberg (00:37:44):
Yeah. I'm not Walt Disney and I want to be. And that's theirs. And it was already there for 75 years in this-

David Segal (00:37:51):
Wow,

Jeffrey Katzenberg (00:37:51):
But

David Segal (00:37:51):
That must have been really hard. I mean, those principles are sheer genius and they're what led you to create the greatest run of animation in the history of the world.

Jeffrey Katzenberg (00:38:00):
So when we start the company, the very first movie we make is a movie called Prince of Egypt. There's a 0.000 chance that that is a movie that the Walt Disney Company would make, that Walt Disney would make that would be under the Walt Disney label because it's religious, it's political. It's controversial. Controversial. And it's adult. I mean not- But

David Segal (00:38:24):
Still has a great villain. Still thought about the ending first.

Jeffrey Katzenberg (00:38:27):
Those things don't change. Those

David Segal (00:38:28):
Principles did.

Jeffrey Katzenberg (00:38:30):
I'm trying to get to the philosophy more or the brand. How do you become a differentiated? So you guys are too young, but going back many, many years ago, there was these two car rental companies in America that were like the top two companies. And one was Hertz, which was the number one car rental company. And the other one was Avis. And Avis had this campaign. It was one of the great Madison Avenue campaigns of all that says, "We try harder." Right? That was- Perfect shot to Hurts. That's Avis. We try harder. So I didn't want to be Avis Hurts. I wanted to go find something that could be our own. So we make a religious movie. We make a very sophistic comedy called Ants that's got Woody Allen in it. It's his comedy, his humor, and it's very sized.

Harley Finkelstein (00:39:22):
Sarcastic.

Jeffrey Katzenberg (00:39:23):
Sarcastic. All that. By the way, homage to Spartacus in there, if you actually remember the end of the movie. And then we make this movie Shrek. So we had to make this really, really sort of, I think, cross the Rubicon, past the red line decision in making that movie, which is there's a scene in the film, so it's pretty edgy by choice that we do. But it actually came down to literally one word, one sentence, one scene in the movie, which is Shrek goes and rescues the princess out of the castle, burning castle from the fire breathing dragon, and he's running out and he gets to the exit and he stops and she grabs him and says, "Come on, we got to go. " And he says, "I have to save my ass." And

Harley Finkelstein (00:40:28):
He referred to the donkey.

Jeffrey Katzenberg (00:40:29):
Yes. Yeah. I go back and save Donkey.

Harley Finkelstein (00:40:33):
Yeah. By the way, we both have kids. We've seen a thousand times. It's amazing. It's incredible. But that is so not a

Jeffrey Katzenberg (00:40:37):
Disney

Harley Finkelstein (00:40:38):
Thing. It's like the antithesis.

Jeffrey Katzenberg (00:40:40):
Right. Well, because remember our customer's mom, there's never ever been a doubt in mind. She's the gatekeeper, she's the decision maker. And if she doesn't think this is safe or appropriate, you're dead.

David Segal (00:40:58):
Well, that's super interesting though. Are you building it for the inner child and mom or for mom today?

Jeffrey Katzenberg (00:41:03):
So that therein lies the sort of fun thing of this. So we make Shrek and I made the decision, we're not going to drop the ass out of it. And I know we're going to, because

Harley Finkelstein (00:41:14):
We've done previews a lot. And people were asking you to drop it. That was sort of- Oh,

Jeffrey Katzenberg (00:41:17):
Trust me. It's a giant debate. On and on and on and on and on. It was like one of the last decisions. And half the camp is, this is the nature of this storytelling, these characters that it is a fractured fairy tale. Everything in its DNA was the opposite of Disney and a fairytale by its design. And I didn't ... William Stagg, the authors who created Trek is the one that did that, that laid it out. That was a little book that illustrated book that became the foundation of that movie. And it was in that. We didn't invent it. We just built on it and made a movie out of it. But the decision to do that, to leave that word in, which was ... So now you went from being a G-rated movie to a PG-rated movie, and we decided to do that, that we were going to do that.

(00:42:18):
And to try and explain it in a way that felt at least okay for us, whether we would have to see, because ultimately mom would decide, is I would talk about this as an homage. I would say at Disney, as he actually set out, we made movies for children and a child that exists in every one of us. At Dreamworks, we don't do that. At Dreamworks, we make movies for adults and the adult that exists in every child.

Harley Finkelstein (00:42:53):
Totally.

Jeffrey Katzenberg (00:42:54):
And somewhere along the line, they'll be okay. They hear the word ass. In reference to a donkey.

Harley Finkelstein (00:43:02):
It's an ass. Actually, ask. Yeah. But it is obviously like you were categorically different in that simply in Disney.That was

Jeffrey Katzenberg (00:43:11):
The

Harley Finkelstein (00:43:11):
Define. It's so obvious. Disney could never have made a movie like that and never would.

Jeffrey Katzenberg (00:43:16):
No. And that was okay. We found our North Star.

Harley Finkelstein (00:43:20):
So were you having more fun then at Dreamworks because you could draw outside the lines?

Jeffrey Katzenberg (00:43:24):
I had fun at Disney. I was there for 10 years. I mean, turnaround stories are fun

Harley Finkelstein (00:43:27):
Too.

David Segal (00:43:27):
Well, I mean, Dreamworks, I mean, you got the dream team. I mean, talk to us a little bit about that. How does that come to happen? I mean, it's like the Golden State Warriors and the Splash Brothers and Kevin Durant. I mean, it's unbelievable. So how did you three get together?

Jeffrey Katzenberg (00:43:43):
So I get fired. I'm in Michael Wisner's office where finally, because this has been going since Frank Wells went down in his helicopter in April. We were on our waitress. It's now like-

Harley Finkelstein (00:43:57):
Because you no longer had ... The marriage council. If Frank was there, do you think it would've been different?

Jeffrey Katzenberg (00:44:01):
100%.

Harley Finkelstein (00:44:02):
Wow. That's the impact of Frank Wells.

Jeffrey Katzenberg (00:44:04):
He was that essential. Yeah. He kept Michael and I in a good way.

Harley Finkelstein (00:44:11):
Did he know he was a marriage counselor?

Jeffrey Katzenberg (00:44:13):
Yes.

Harley Finkelstein (00:44:13):
Okay.

Jeffrey Katzenberg (00:44:14):
Yeah. All three of us knew. And honestly, within 24 hours, we were not able to communicate with each other the way we were when Frank was around. It happened that fast. It was like, "Oh, geez, this is not working anymore. These guys are ... " You could see it. I mean, I could see it. Yeah.

Harley Finkelstein (00:44:30):
So you're in his office or in Eiser's office.

Jeffrey Katzenberg (00:44:33):
So he calls me in. I know why I'm being called in and it's like the nicest meeting I've had with him in four months or whatever in that we know what we're here to do and now it's just say it. And I am so at ease with this because again, for many people, a blank slate, a whiteboard is a scary thing. And for others, it's the world, like whatever you can imagine. And at that point for me, as it has been almost every single chapter of my life, it's like, okay, this ran its course. It was great. It was 10 years. I loved every single day of it. And I'm ready to go out and climb a new mountain, find another range, another Everest or whatever it

Harley Finkelstein (00:45:23):
Is. How did you know that was the end? How did you know he was going to

Jeffrey Katzenberg (00:45:25):
Hire that day?

Harley Finkelstein (00:45:25):
Okay. So it was clear.

Jeffrey Katzenberg (00:45:28):
It was everything but actually saying it

Harley Finkelstein (00:45:30):
Had- And you wanted him to say it? Well,

Jeffrey Katzenberg (00:45:33):
I was ready for it. I could have changed his mind and actually delivered on the promise that he made to me because that's why we got sideways. He promised me something and then ignored it and then denied it. And I just was like, okay, well if ... And by the way, you could just say to me, I changed my mind. I mean, what made it nasty is that he just denied that he ever done it and there were witnesses to-

Harley Finkelstein (00:45:59):
And trust battery just got so low.

Jeffrey Katzenberg (00:46:01):
Yeah. And so it was like, okay, let's just go our way and I'm okay with that. Michael says, okay. And then we sit and we talk for an hour. I walk out of his office and I walk back to my office and my secretary's there and she's crying. I go, "What are you crying about? " She said, "Well, you're fired." I went, "Yeah, that's fine. Okay." And I said, "Well, how did you know? " And she said, "Well, it's all over the news." So while I was in Michael's office, the moment I walked into his office, his PR team put the story out to talk about an ambush.

Harley Finkelstein (00:46:33):
Yeah. I mean, total Machiavellian.

Jeffrey Katzenberg (00:46:35):
Okay. And that was the beginning of World War III, which it became. But anyway, it was like, oh my God, really? Okay. So he put it out. And so when I walk into my office, she's crying and I said, "How did you know? " He said, "Well, it's been out. It's all over the news. And by the way, you have gotten a phone call from literally Bill Gates, Tom Murphy, who was at Cap Cities, ABC, and Steven Spielberg and Bob Zemeckis are on the phone holding on waiting for you to come back to the office." I said, "Well, what do you mean?" I said, " been waiting. They've been holding here for 20 minutes." Oh my God. Oh my God. So I go into my office and they have me on the speakerphone. The two of them are in Jamaica together. We'd made this movie, Roger Rabbit together, the three of us and had quite a journey together and they were vacationing together and I pick up the phone and go hi, and they went,

Harley Finkelstein (00:47:34):
"God, this is the greatest thing

Jeffrey Katzenberg (00:47:36):
Ever." Yeah, you're still-

(00:47:39):
Processing. 10 years of your life. Yeah. Processing's a good word, Harvey. Anyway, so they think, "Oh my God, this is the greatest thing ever. It's time for you to move on. " And Bob Zemeckis says, "Jeffrey, you should just start your own studio." He's the one that put the idea and I said, "Great, thanks very much." I hung up the phone. I went, "Hmm, there's an idea. I want to continue to make animated movies. The only way you could do that is actually start another studio." And so if I list the four most important mentors in my life, Barry Diller, Michael Eisner, David Geff, and Steven Spielberg, right? Those are the four. So David, who had been kind of like the older brother everybody in life would wish for and hope for, I went to him first and I said, "What do you think of this idea?" And he said, "Well, what are you thinking?" I said, "Well, the home run of all time would be, which is you're the entrepreneur and I'm the builder.

(00:48:43):
The greatest story of our storyteller of our lifetime is Steven Spielberg. Let's go see if we can wrangle him." And he said, "Well, you go talk to him and see if he's got any interest in it. " And that was sort of the genesis of it. And then it sort of built out from there. But we- Why

Harley Finkelstein (00:48:58):
Do you call Geffen the entrepreneur?

Jeffrey Katzenberg (00:49:02):
He is the entrepreneur. So he's

Harley Finkelstein (00:49:04):
Entrepreneur. And you're the builder. Exactly.That's fascinating because you're also incredibly entrepreneurial.

Jeffrey Katzenberg (00:49:09):
We all are,

Harley Finkelstein (00:49:09):
But all three

Jeffrey Katzenberg (00:49:09):
Of us have all three

Harley Finkelstein (00:49:10):
Attributes. Okay. But this is more like superpower kind

Jeffrey Katzenberg (00:49:14):
Of thing.

David Segal (00:49:14):
So what is the difference between a builder and an entrepreneur in your mind?

Jeffrey Katzenberg (00:49:17):
An entrepreneur is someone who understands structure, finance, fundraising, strategic ... David's a real master thinker and brilliant. And where the rest of us were more employees, Steven and I were employees, David owned his own businesses. He started his businesses. He built his businesses and we didn't here. We always worked for somebody else, Steven and I. And so the idea that we could actually do what he had done writ large,

(00:49:54):
He was essential in that. And that was the strength of us at the outset is that it was very, very easy for me to ultimately defer to David on those kind of business things and to Steven on the storytelling, and they would defer to me. And so I actually look back and I just think, well, this was beyond miraculous that for me, I had just been fired in as public and unceremonious way as you can because Michael didn't want me to just leave and he didn't want me just not to compete. He wanted to actually-

Harley Finkelstein (00:50:35):
Embarrass you. ...

Jeffrey Katzenberg (00:50:35):
Kill me. Yeah. It was actually worse. I mean, he literally wanted me off the

Harley Finkelstein (00:50:41):
Planet. Which is paradoxical because what he did was he created the worst competitor possible in that one simple act of firing you.

Jeffrey Katzenberg (00:50:49):
Yes, he did. But again, that's Shakespeare and we can go discover the makings of all of that, but whatever it is, whatever those reasons for, and he keeps reconceiving them. I actually, he did some radio interview, which I saw like a week or two ago. I listened to a podcast or something on it, and he has a whole new version of the story and that's what he ... But that was always, in a way, kind of his brilliance is that he sees things through his lens only. And in many respects, that was his superpower, but it also was blinders.

Harley Finkelstein (00:51:28):
When did you know that Dreamworks made it? When do you know that Dreamworks was ... Couldn't have just been Trek. There must have been a moment where you, Geffen and Spielberg look at each other like, "It's

David Segal (00:51:37):
Working." Well, it was a risk for you. I mean, you had to put in $33 million? Yeah,

Jeffrey Katzenberg (00:51:42):
We all put up money. Although yeah, mine was the only one where I actually had to mortgage my homes to put up my share of the-

Harley Finkelstein (00:51:47):
Because at that

Jeffrey Katzenberg (00:51:48):
Point,

Harley Finkelstein (00:51:48):
You didn't have what they had.

Jeffrey Katzenberg (00:51:49):
Yeah. So what I go back to is that, so in 1994, I get fired, Steven Spielberg wins the Oscar for Schindler's list in February and then puts out Jurassic Park-

Harley Finkelstein (00:52:03):
Oh my God.

Jeffrey Katzenberg (00:52:04):
... in June, right?

Harley Finkelstein (00:52:06):
He's on a roll.

Jeffrey Katzenberg (00:52:07):
Yeah. He wins both the Academy Award and the Bank of America award in the same year, which is like, I don't ... It doesn't happen. Yeah, that hasn't happened. And by the way, I had obviously all the other things that had come before it, but it was just like it was a capping moment for him. And David had just sold his record company for like the fifth time for another billion dollars. Somehow or another, he could keep repackaging this into a different wrapping paper and serve it up and sell it

Harley Finkelstein (00:52:37):
Again. No, I know, he called me entrepreneur.

Jeffrey Katzenberg (00:52:39):
So you have these two guys who were like, at that moment, those were pinnacles of success for both of them. And I'm at once again, the Nater, fifth Nader's the right word. Yeah, whatever you say. The bottom, right in this. And so for me, I always look back and I go, well, the fact that that could work out and that we would be partners and equal partners in this, you couldn't bet that on Kelsey or Polymarket or Vegas. No one would take the odds on that bet. And so that was sort of the magic of that moment of the three of us coming together. And we all recognized each other's superpower and that's ... People believed there was zero chance that the three of us, each of us with our neediness, our egos, our ambitions, the fact that we had all reached a point in which we never heard anything other than yes.

David Segal (00:53:43):
Yeah. And no marriage counselor in this relationship.

Jeffrey Katzenberg (00:53:44):
No, no marriage counselor in this. And that the three of us, everybody just thought, "Well, that'll last about a minute." And the fact is it lasted 20 years.

David Segal (00:53:52):
Well, it's crazy. Jeffrey, you talked about not being able to take compliments. You talked about the things that you love about in yourself, but you haven't talked about, and this may be hard for you, but your superpower, I mean, you started to talk about David as the entrepreneur and you as the builder. What did you bring to the table that these two complete titans, like the goats, frankly, saw in you? What is your superpower?

Jeffrey Katzenberg (00:54:14):
Well, that I am a builder. I could actually say, okay, how do you put a team of people together? How do you execute on a strategy? How do you ... And then I did this little thing over here called animation, which Steven was extremely deferential about because he had made animated movies, but they weren't at the level of what we were doing. And-

Harley Finkelstein (00:54:38):
And he an appetite for more animation? Did

Jeffrey Katzenberg (00:54:41):
He?

Harley Finkelstein (00:54:41):
Yes.

Jeffrey Katzenberg (00:54:44):
He was doing a lot of TV. He was wildly successful in TV animation, but not in feature animation. He had one movie which did well, but not like blockbuster time in this. And so again, he and I just collaborated very, very well over the years. There was a great synchronicity with us. We liked many of the same things. We liked many of the same filmmakers. He always found me a good sounding board, which was a huge ... I took that as an incredible vote

Speaker 3 (00:55:19):
Of

Jeffrey Katzenberg (00:55:19):
Confidence, that he'd actually care what I had to say and would want to hear what I thought of a script or whatever. And the success that he was having, he'd already had it beyond belief by the time we got into partnership in it, he really was a sovereign state, if you will.

Harley Finkelstein (00:55:39):
Yeah. But still hungry, clearly.

Jeffrey Katzenberg (00:55:41):
Yeah. And the fact that he was not just generous in bringing me into it, but also valuing me as a partner in it, today we still refer to each other as partners. We haven't been partners in more than a decade.

Harley Finkelstein (00:55:56):
How was that 20 year stint? I mean, was it all up and to the right? Did it feel-

Jeffrey Katzenberg (00:56:01):
No.

Harley Finkelstein (00:56:02):
Okay. Talk a bit about that.

Jeffrey Katzenberg (00:56:05):
There's different parts of it. There really takes place in a 10-year period of time and then a 15-year ... 10 years is the three of us together. We always managed to find enough common ground, Steven and David and I. And I would say I was the marriage counselor in that, because I always considered myself to be their junior.

(00:56:25):
They never treated me that way, but I always, always, always felt like they were the superstars in this. I was lucky enough to be along on the ride and not accepted me as a partner and an equal in it. I thought it was okay. So my job is to keep everybody happy. And so I always put my wants and my needs back of the bus here to be in service of the two of them. And in any 10-year relationship, we had many, many things we agreed on mostly. We had things we disagreed on, and I was usually the broker between them, and we always were able to get to a good place.

David Segal (00:57:06):
What were the economics of Dreamworks like? I mean, I read somewhere that ... I mean, of course, we all see the finished products, American Beauty, and the incredible movies that you guys glad here and you guys all created, but was the economics of the business trying at times for you? And I didn't realize you were on the front lines.

Jeffrey Katzenberg (00:57:22):
Yeah. We struggled those first bunch of years in this, which is the cost of the business, the cost of the movies, overhead, our ambition, the fact that Steven and I both have eyes bigger than our stomach. David was always the one pulling the reins in on this. We wanted to build our own studio, physical ... We were going to build over in Ply Vista. We had all these ... We were in 20 different businesses. And so we had our ups and downs. Paul Allen was an amazing, amazing investor and basically said," I'll give you this money for 10 years at the end of 10 years. You guys got to ...

Speaker 3 (00:57:58):
Whatever's

Jeffrey Katzenberg (00:57:58):
Left, give it back to me. "And so he really was an incredible patron. We recognized how lucky we were to have him. Not many would ride along the way as he did and be as supportive as he did. He never lost faith in it. And ultimately, we had actually a great outcome out of it, but it was a long journey and there were very much ups and downs. And every time we'd have a big success, people would be generous, but every time we would have a miss," Oh, it's the end of the dream building. It's going out of business.

Harley Finkelstein (00:58:36):
"But you said you mortgaged your house. I mean, obviously that is ... How was that conversation with your wife at that point? She's been rider down

Jeffrey Katzenberg (00:58:43):
With you for a while. Well, she'd never forgiven Michael Eisner for that. That's it. Everything else, she could ... No problem. But the fact that she no longer owned the roof over her children's head was something that she literally never, ever, to this day would not-

David Segal (00:59:04):
Still.

Jeffrey Katzenberg (00:59:05):
Yeah. Yeah. It was just-

David Segal (00:59:06):
And how long did that take before you got out from

Jeffrey Katzenberg (00:59:08):
There? Four years, five years till I had to sue him to get paid the money that they owed me. Because it was not just that we had to mortgage the homes, but the reason we had to mortgage the home is because Michael wouldn't pay me what he owed me, which ultimately, as you know, years later he did.

Harley Finkelstein (00:59:23):
And why? He was just bitter? I mean, there's no reason for that.

Jeffrey Katzenberg (00:59:27):
Shakespeare. Right. Yeah. Yeah. Okay. I can't explain it, but Shakespeare could.

David Segal (00:59:31):
Jeffrey, I want to ask you about, one of the things in our research came across is that you're particularly good at connecting with and motivating creatives. Tell us a bit about how you did that.

Jeffrey Katzenberg (00:59:42):
Well, I love people. I love storytellers. I love great musicians, artists. It's just I have great appreciation for them and Had good mentors that taught me how to talk to them. And I always considered what I did then. My reference point is I said, I'm a truffle hunter. My guys are called me a golden retriever. I think when he said it, it was derogatory, but that is what I would do. I would see somebody with talent. By the way, it's what I do today. I mean, now I've spent a decade in investing. And honestly, the parallels in these things is shocking because the characteristics of a great storyteller, producer, director, and a great entrepreneur, you'd be shocked at how similar they are. And I think that was part of what attracted me to venture capital in Silicon Valley is that you go back to the early, early days of that.

(01:01:00):
And Don Valentine and Sequoia and John Doerr, they were truffle hunters. Yeah. That's what they did. They found great people and backed them and helped them and showed them. It wasn't just like writing checks. They got in there and helped them realize their ambition and their vision. And that's what I did with filmmakers over the years.

David Segal (01:01:22):
You mentioned you knew how to talk to them. What's different about talking to them than perhaps others?

Jeffrey Katzenberg (01:01:32):
I find that artists, all artists, their emotions are much more front and center. It's what allows them to be creative is that they are more in touch with their emotional side than most others. And through that, are able to actually make themselves vulnerable because when any actor or actress gets in front of a camera, there's a vulnerability about them in that they're acting. Well, how is it that Julia Roberts, you can see her running down the street and somebody is chasing her with a pickaxe or whatever it is. And you see this look on her face of terror and it's like real. She makes you believe it. Well, how is she able to do that? Well, she's able to pull up her emotions and emote in a way that makes her one among one,

(01:02:44):
Right? Or pretty woman walking down the street. And I can go on and on and on and go to Steven Spielberg. Again, I don't even think it's an argument. He's the greatest storyteller of our lifetime. And in a way that's part of what is this chemistry around him, which is that he is a mix of all kinds of amazing emotions, many of which are super positive and imagination and all that. But at the same time, in order to see the child in us, which you go back to ET and these movies he did as well or better than anybody, it's he can get back in touch with himself and see the world through the eyes of Elliot and be able to be evocative or to evoke those out of an actor. It's magic. It's magic. And I- Can you teach that? No, I don't think so.

(01:03:55):
I mean, you can learn aspects of it.

Harley Finkelstein (01:03:57):
Aspects of the skills, I think.

Jeffrey Katzenberg (01:03:58):
Yeah. Just like I was taught aspects of it by Barry and Michael and Don Simpson and all of these people I work with over the years. I had many, many, many, many people that I have learned from. But then you get down to a place of ... Barry always said, when I worked for him, your job is to get up every day and find things that you love, that you want to see and pursue the best version of them or set out to make the best version of them that you can. And then when it's all said and done, you just have to pray that other people have the same interests that you have because you're not a school teacher in the Bronx. You're not a college kid at UCLA. I could go on and on and on. You are none of those people. You are you.

(01:04:56):
And if you think your job is to imagine what they want, you will fail. You have to have the confidence of pursuing things that interest you.

Harley Finkelstein (01:05:08):
It's a little bit like in tech startups as well, I think the best founders ... Certainly the story for Toby and I at Shopify has been that we've always built a product that we wanted ourselves. And assuming that other people may find value in it. You don't necessarily build it for any particular ... If I would ask the people what they want, they'd say a faster horse. I want to ask about Grametch as we wrap up here, did your dad get the chance to see who you've become? Yeah.

Jeffrey Katzenberg (01:05:35):
And Alice, I'll give you one absolutely one of my more favorite stories. So as you know, for our parents, you guys are ... There are these moments where generationally they grow outside of the world. It just happens. Yeah. It happens. All of us, every generation has it. And so one of my favorite stories of my dad is that ... So I had made a movie called Color of Money with Paul Newman and Tom Cruise. And my father was in a restaurant in New York City, and Paul Newman was having dinner with Joanne Woodward. The two of them were having dinner together in there. And my father couldn't help himself because he knew we had just made this movie. And he went over and he said," Hi, my name's Walter Katzenberg, and I just want to introduce myself. I believe you're working for my son. "Shit.

(01:06:34):
Paul News the biggest star in the people. Two biggest stars in the world right now. And Paul Newman says, and he's a really great boss. Wow.

Harley Finkelstein (01:06:43):
Nice, amazing. Classy move by Paul Newman. Yeah, of course. Actually, I do that all the time also where I meet someone. The Jewish parents are all the same, ultimately. They all want that.

Jeffrey Katzenberg (01:06:55):
And there are always these moments, you get a little bit embarrassed.

Harley Finkelstein (01:06:57):
And totally, you're like, " Oh, come on mom. "You don't say that. For a long time, I think my mother actually thought that we were building eBay or something like that and she go around. Spotify. And actually, but there are these moments. For my parents, I think it was the IPO. I don't know if it was.

David Segal (01:07:12):
Yeah, my parents.

Harley Finkelstein (01:07:12):
We're at the IPO, they're like, " Oh, it's a real thing. It's real. "Can I ask you a little bit about that? The Jewish parent thing, because if you sort of look on a global scale, eight billion Jews, sorry, eight billion people, 15 million Jews, we are a tiny percentage. And yet, especially when it comes to entrepreneurship, we've been so disproportionately effective. We're impactful. We always sort of joke, we think it's actually the Jewish moms or something. There's something about it. You're a couple years older than we are, so maybe have no experience. What's your take on that?

Jeffrey Katzenberg (01:07:45):
I didn't really grow up around the despora of it. So it's not like I was ... My mom always said for me, as long as I can remember as a teenager, as young adult, that I was like a wild Mustang stallion and that you cannot corral him, you cannot put a saddle on his back, you cannot put a bit in his mouth. All you can do is leave a light on in the barn and a lot of hay there and just hope that from time to time he wanders back in to hang out. And it's kind of true. And I always came back, not because they made me or there were rituals around that and just a very, very young age. He just said," You're not going to corral this one. We're on for the ride.

Harley Finkelstein (01:08:49):
Let's see

Jeffrey Katzenberg (01:08:49):
Where it

Harley Finkelstein (01:08:49):
Goes. "Although when you look at the people you sort of spend your time with, for better for worse, like Eisner, Barry, Steven, first of all, they're all Jewish. David and I interviewed someone, I forget. Oh, it was Michael Milken who told us a story that if you look at the founders of all the major studios in Hollywood- Yeah,

Jeffrey Katzenberg (01:09:06):
They were all Jewish.

Harley Finkelstein (01:09:07):
Not just that. They all grew up within 30 kilometers of each other outside of Poland. Poland. 30 kilometers outside of Warsaw. And they all on their own, individually, independently, all started studios. I'm not a religious person, but culturally I do obviously very proud to be Jewish and-

David Segal (01:09:25):
Well, I think it's connected to- There's something interesting about it. Diana ask you this. You've taken these big swings. You've reinvented yourselves multiple times. How do you contextualize failure?

Jeffrey Katzenberg (01:09:36):
Another great lesson from Barry Diller. Barry, so again, this goes to shoulders that I've stood on and it's really about failure. So this is both Barry Diller and Michael Eisner. So Barry Diller version of this was your job is to do things that are unique and original. So you go back into the movie business in the '70s and '80s, it wasn't about franchises, it wasn't about repurposing things that were successful. Looking for Mr. Gordbar hadn't been published yet. It wasn't about Steven made Jaws, he bought it before it had been published. So Barry's thing is your job is to find things that are unique and original, which means they haven't been done before, or you're going to find a new way to do them that makes them unique and original. He said," If you do things that are unique and original, that equals risky. There's risk involved in doing things that have not been done before.

(01:10:46):
And if you're going to do things that are risky equals, there's going to be some failure. And in order for you to be successful at doing your job, failure cannot be fatal. It's okay that it's not pleasant. It's not that it has no consequences to it, but there needs to be room for failure in order to take risk, in order to do things that are unique and original. I don't think Barry ever expressed it quite that succinctly, but that is exactly what he did. It's

Harley Finkelstein (01:11:21):
Beautiful way to look at failure.

Jeffrey Katzenberg (01:11:22):
Yeah. Beautiful. Now, the other side of that is what I learned from Michael Eisner, not that that was what he intended, is getting fired is infatal because within weeks of getting fired- Dreamworks. ... started Dreamworks with Steven and David and $2 billion in the bank and off we went. So it's a dark time for people when they are fired, but they need to know that there's one door closes and another one opens. And so I've always been fearless. I'm not ... It's actually the wrong word. It's not that I am fearless. It's that I am actually without fear. There's a difference. Fearless is you know what you're going to face. You're going to get in a car and drive 220 miles an hour like Lewis Hamilton, or you're going to get on a 50-foot wave like Laird Hamilton or any other Hamilton that we'll go find here and this.

(01:12:21):
And you're going to do things that are ... They're very fearful things to do, obvious that they are. And interestingly, because I've talked with both of them, and I've interviewed both of them over the years, and I'm so fascinated about both of them, because I feel the same thing about myself. It's not that they are fearless, it's that they are without fear. And the reason they are without fear is both of them, each in their own sport, will articulate to you like, "No, I know where I am. I know where I'm this. I know what the risk is involved

Harley Finkelstein (01:12:58):
There." And I can do it again if I needed to.

Jeffrey Katzenberg (01:12:59):
Yeah, I know how to do it. I know what the math is on this in it. And like Louis Hammond will tell you, there's absolutely nothing about driving a car 220 miles an hour in this other than the mistakes somebody else makes. He says, "That's what I have to be on alert for. It's not that I'm going to do something, it's that somebody else is going to do something here. And that's why I have to have eyes, ears, instinct, everything around me. " You see it in those car races when they're all packed up with one another. It's somebody else's error. He knows what that car's going to do. He knows what his body needs to do and that he can deliver on that, blah, blah, blah,

Harley Finkelstein (01:13:38):
Blah, blah. The Web Fear thing is a beautiful way to put it. Maybe a final question before we let you go here. Dave and I think a lot about ambition or we've been ambitious our whole lives. Some of it is driven by insecurity. Some of it is driven by a sheer will to build and sort of core and enthusiasm and excitement about what we get to do every single day. One of the things that we think a lot about is as you have success in your life and you've had incredible success, do you ever feel like you've finally made it? Do you ever feel like, "All right, I'm enough. I have enough?"

Jeffrey Katzenberg (01:14:18):
We'll end this where we started it. The answer is never let your memories be greater than your dreams. That actually answers your question, Ari, which is there's not a day that I wake up, not a day ever. And that I am thinking about when I wake up, Shrek or Spielberg or Schindler's List or

(01:14:48):
Beautiful Mind or Gladiator, all of these, they're not on my mind. I have a whole bunch of things that I had on my to- do today, including being here with you guys, which when I said yes to it, I was excited and looking forward to doing it. I haven't done this. I haven't spent time on this. And I thought, okay, you know what? That'll be fun. We'll have a good time with this in it. And I came here excited to do it and with the ambition to at least attempt to exceed expectations. One does not succeed at it all the time, even though my watch is on my left hand and I try in this, I go for it in it. And so for me, I have this incredible gift that somehow or another, I don't know where it came from and I don't know who gave it to me, but that I am in Lewis Hamilton's car driving 220 miles an hour.

(01:15:47):
I have no rear view mirror, I have no side mirrors, and at 220 miles an hour, if you don't keep your eye on the road, what's in front of you, you're in trouble. And so I'm-

Speaker 3 (01:15:59):
Beautiful way to play.

David Segal (01:16:00):
Jeffrey, you've not only exceeded expectations, but you've inspired Harley or not. You've inspired every listener, I'm sure, who has been hearing your stories, which are nothing shorter remarkable. Thank you so much

Jeffrey Katzenberg (01:16:10):
For doing this. Fun doing it. Very grateful. And I've now noticed we all wear the exact same uniform.

David Segal (01:16:14):
It's the standard big shot uniform. That's right. White sneakers and black. Yeah.

Speaker 3 (01:16:19):
Started from the bottom now the whole team here. Started from the bottom now.