Co-founder of Pixar shares tips for entrepreneurs

March 9, 2009 by Dustin Edwards NMSU Round Up

An NMSU engineering alumnus and prominent computer graphics entrepreneur provided tips and insight on how to start a business Friday to more than 100 people as part of the College of Engineering Verge Fund Lecture Series.

Among his many titles, Alvy Ray Smith, former executive vice president and co-founder of Pixar Animation Studios, former director of computer graphics for Lucasfilm and retired CEO and founder of Altamira Software Corporation, said his companies had unusual beginnings, all of which would not have been possible without a bit of luck.

“[Pixar] should have failed many times,” Smith said. “But it didn’t.”

Along with partner Ed Catmull, Smith said he founded Pixar in 1986 with a financial backing from Steve Jobs, the CEO of Apple. Smith said Pixar started as a hardware company because, at the time, it was more plausible to sell to venture capitalists. The company had a difficult start, which almost went belly-up several times.

Although Pixar’s back story began with a humble financial beginnings. Smith said his idea was to make Pixar the first company to produce a feature-length computer- generated movie.

“Imagination is real,” he said. “Starting a company is turning imagination into reality.”

After several years of struggling to keep Pixar running, he said, with more luck, Disney approached his company about making a movie.

He explained the success of Pixar happened overnight, when the company went public with Pixar’s first movie, the 1995 smash-hit Toy Story.

Along with providing Pixar’s background, Smith told on-lookers about the process of starting a company. In the early stages of drafting his company, he said he bought books about how to start a company, learned financial words and how to talk to venture capitalists when asking for money.

“The goal is to be so impressive with your presentation that [venture capitalists] hand you a check,” he said.

He added that although making a lot of money was not necessarily his motivation, he had to clearly convey to the venture capitalists he wanted to make money.

He said his second entrepreneur venture, Altamira Software, similarly had a problematic start: it didn’t work.

However, with an “in” at Microsoft, Smith said he was able to sell Altamira in 1991 in a deal struck for $6.5 million with Nathan Myhrvold, former chief technology officer at Microsoft. The day after the negotiation Smith said he was in the hospital for a stress-induced injury.

“If you can’t take stress, then you shouldn’t be an entrepreneur,” Smith said.

But he added, “Success: it feels really good.”

Stan Indurthi, a graduate chemical engineering student, said Smith presented an inspiring lecture.

“It was awesome,” Indurthi said. “I came [to the lecture] out of curiosity.”

He said although he does not intend to start up his own company, he was still motivated by Smith’s story.

After receiving his bachelor’s degree in electrical engineering from NMSU in 1965, Smith obtained his doctorate degree from Stanford University in 1970. According to Smith’s Web site, he worked at the New York Institute of Technology as a senior scientist before working for George Lucus’ Lucasfilm in 1980. He was awarded an honorary doctorate degree from NMSU in 1999. Additionally, he became the first Graphics Fellow at Microsoft in 1994.


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