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00:00This is my kitchen table and also my filing system over much of the past three decades. I've been an investor the highest quality of mankind. I've often thought his private equity. And then I started interviewing on my watch here. INTERVIEWER I know how to do it. I've learned in doing my interviews how leaders make it to the top. I asked him how much he wanted. He said 250. I said fine I didn't negotiate with him. I did no due diligence. I have something I'd like to sell and how they stay there. You don't feel inadequate now because being only the second wealthiest man to rise right over the past 15 years one of the most successful corporate CEOs in the world has been Bob Iger. He led Disney to its greatest fights increasing the market value by some 400 percent. He did that through acquisitions of 21st Century Fox Lucasfilm Pixar and Marvel Entertainment. Now the question what is he going to do next. During the time that you were the CEO the stock market value of the company went up about forty four hundred fifty percent and the market capitalization about 400 percent during that 15 year period of time. So my big regret is that I didn't back you and buy stock but you must be very pleased with what you accomplished in the 15 years that you were the CEO. Yes I'm proud. Would probably be the right word to use. You know I inherited a company that was renown and had been quite successful but also gone through a period of difficulty on a variety of levels. And there was a lot of work to do. And my sole goal was to not only improve the lives a lot of the company but to ultimately leave the company in great hands for my successor. But you weren't as successful in leaving the company because you had wanted to leave a few years earlier. And then the day the board said now you've got to stay longer because you did the Fox acquisition among other things. So why were you so good at running the company but not so good at leaving the company. I am told that that's a common element of CEOs that have had decent tenure. And I saw I failed leaving a few times the first time we had had a succession process that didn't work out as we had hoped. And so I agreed to stay on a little bit longer. And then the last time was solely due to the largest acquisition that we had ever made. And that was most of the assets of 21st Century Fox. And I knew when I proposed doing that to the board which was close to when I was supposed to step down that they would say well we will support you in this effort as long as you agreed to stay. They did not want and for good reason to go through a CEO transition. Just at the time we were making the biggest acquisition we'd ever made. It was rumored in the press and in your book that you were thinking of leaving Disney to run for president of the United States. So whoever heard of a businessman running for president did state. So where did you get that idea from Tracey's guide here. Right. Well there was some truth to that both before the 16 election and then after the 16 election I gave it some serious thought actually post the election of Donald Trump. I gave it a lot of thought and actually did a fair amount of homework to study the feasibility of it. But I'm not sure I would have gotten as far as actually running because as the realist in me was was sinking in I was starting to think more and more about how difficult the path might be in the Democratic Party for a businessman to actually get the nomination. What would you say is the chance that you would be interested in serving in a senior position in a Biden administration. Would that be something of any interest to you or you wouldn't want to come to Washington for that kind of thing. Well I've always thought about what the next chapter in my life might be. Post is neat because there will be a post Disney soon. I'm not going to fear stepping down again and giving back in some fashion of serving our country in some fashion is certainly something that I would consider seriously. But a lot of it would depend on you know what it is what the opportunity is and whether I thought it would be something that I would both be stimulated by and and be good at. So let's go back to the Disney situation. You announced that you're going to step down finally at the end of 2019 become executive chair and then Cove. It comes along and they cove it make it possible for you to leave as the same way you thought you were gonna be on leave or do you have to spend more time at Disney when Cove it hit. Well what actually happened was I stepped down from the CEO position as you mentioned to become executive chairman and to focus all of my time and energy on our creative process because I thought obviously what we create is the most valuable product that we have. And I thought that the best thing I could do in terms of enabling my successor to succeed at the job was to hand him a very very rich pipeline of great creativity. And in fact I have spent almost all of my time since I stepped into this role doing just that. However I also wanted to make sure he was successful in in other respects as well. And he had not handled a crisis that was anything like this by the way nor nor had I. And so I you know I wanted to make sure I was there for him to help him through what is obviously particularly challenging time not only for the world but very specifically for our company. And I've done just that. So he's been the CEO. He's been running the company from the day he stepped into that role. I feel confident that he is doing a good job and we'll do a good job into the future. And I've probably been there for. Little bit more than I might have expected. I think one of the hardest things is in passing the baton on to someone else. You know you expect that you're going to spend some in a situation where I was going to continue as an employee an executive of the company I expected I would spend more time with him. Meaning being more physically present as an adviser and as a support for him. That obviously has not happened has been a little bit more challenging. So if somebody was an outsider and they'd say well Cove it is hitting the United States hitting other places the kind of companies that aren't going to do well are companies that say are in the theme park business. The live entertainment business the cruise ship business the hotel business. And those are all the businesses they are in. Yet your stock has really rallied and done reasonably well. Why do you think you haven't been as hard hit financially as you might think on from the outside. I think the reason our our stock has been resilient and the company has been resilient is we're on extremely solid footing as a company going into this. Meaning our businesses were all doing well and their prospects for the future were actually quite bright. And so I think the street has looked at us knowing that we've been affected in dramatic fashion by covered but also realizing that when it ends we will have the ability to rebound in a significant way. In addition to that we had pivoted in a very significant way in the direct to consumer digital entertainment direction meaning we launched Disney Plus ESPN Plus and the acquisition of 21st Century Fox for a controlling share of Hulu. So we moved into a space that is not only very exciting in many respects the future of entertainment but one that invests the investment community is looking at very positively. So how did a nice Jewish boy from New York wind up running Disney. It is. By the way it's a pinch and pinch yourself moment. So how did a nice Jewish boy from New York wind up running Disney. Let's go through that. You grew up in the New York area is that right. Yes it is. By the way it's a pinch a pinch yourself moment. And I grew up in a relatively modest background lower middle class. My dad was a well educated man in the advertising business but he suffered from terrible manic depression and it made it very difficult for him to hold a job. My mother became an employee at a high school library a junior high school library. Later on in my in my childhood to help support our family. But it was modest back home. But I. But I loved. I never felt poor. And I never felt deprived of anything including love. By the way my family. Your parents then say you need to be a lawyer or a doctor or something like that. They didn't say that to you. There was a little bit of a push for me to be a doctor because my mother's oldest brother was. But no. My my father and my mom were pretty good at letting me pursue my whatever my dreams were. And my dreams early on were to become a Walter Cronkite or a television news anchor person. I actually became a weatherman when I left Ithaca College for a local TV station there. And that was sort of the start. Get a job on camera and then hopefully work up work your way up from there all the way to you know possibly becoming a network anchor man. Well that didn't happen. I lost confidence in myself and my ability to actually fulfill that dream. And so I pivoted and took a job behind the scenes in production at ABC in the middle of 1974. So have you ever thought you could have been Al Roker if you were really good at being a weatherman. That's true. Yes. You know I I tease every once in a while I'll go into one of our TV stations or visit Good Morning America. And I warned them that you know my next job may be theirs. And I may you know I may become a weather person on Good Morning America. So initially you were doing some production at ABC and so forth but eventually went into the sports area. So did you think your career was going to be basically one day running ABC Sports and that would be the highest that you were to rise still. That would have been fine with me. Actually there are a number of steps along the way that if I had achieved them I would have been absolutely fine with that being kind of the last job. Yes. I would have loved to have been president of ABC Sports. Interestingly enough I never got that opportunity. The people who had purchased ABC from Capital Cities Communication Tom Murphy and Dan Burke actually took me out of that role and sent me out to L.A. to run the entertainment division of ABC or primetime programming which is a huge step for me into an area the business that I had very little familiarity with. But they believed in me and gave me that shot. So when you you're doing very well out there then ABC says you're doing so well. We want you to come back to New York and kind of help run the whole company. Did you want to go back to New York at that point. I did. I was ready. I had done my four and a half year stint at ABC Entertainment. I liked L.A. but I was ready to go back to New York and they offered me the job to be president of ABC the ABC network. Now you're the big shot and you are going to be you're running the whole company. And then all of a sudden cap cities people say guess what. We're gonna sell the company to Disney. So was that something you were happy with. Or do you think there was a role for you then. Well it was an incredible time. It was the summer of 1995. And I had been told by Tom Murphy who was then chairman that it was likely I'd become the next CEO. I was CEO which I thought was great. Warren Buffett by the way was our largest shareholder. And I thought he had some enough faith in me. But Michael Eisner approached us and made an offer that not only we felt we couldn't refuse but we thought it was in the best interests of the shareholders of the company. Turns out we were right. And look in the back of my mind even though Michael made it very very clear that they were never going to be a guarantee as if I played my cards right. If I'd performed well I could potentially run the Walt Disney Company something at some point. So eventually Michael Eisner decides to retire a little earlier than maybe he had thought he was going to retire. The board says we have to go look for somebody to run the company. Did they just call you up the next day and say it's your job or did you have to kind of go through a little beauty contest. Yeah a little beauty contest would be an understatement. We as I mentioned at the beginning of this discussion we had gone through a tough period of time and the board felt that and rightfully so looking back that they had to be expansive in their thinking about who the next CEO should be. And they created a true contest. They they considered a number of outside candidates. They interviewed outside candidates. They said to me that I was the only inside candidate. But they made pretty clear at the beginning that not only was not a guarantee but it was less likely that I would get it because I had. Yoho for five years and they they seemed intent on bringing change to the company because they felt it was needed. And so as the Insider I actually had the outside track not the inside track. So eventually they call you up and say the job is yours. And subsequently as I mentioned at the outset your stock is up about 400 plus percent and market caps about 400 plus percent. Did anybody ever call you up and say hey we made the right decision we're sorry we made you go through that process than anybody do that. No one said that. We're sorry. We've made you go through the process today on a number of occasions board members. We're very generous in their complements of me. And to me about the job that I was doing I think you know looking back I think they thought they made that they made the right decision. And look I think that the numbers speak for themselves and the position of the company today is far different than it was back then. And you know a lot of that was due to a strategy that was laid out even in this succession process because they discussed some of the things I wanted to accomplish and being able to execute that strategy over the years. In your book you point for acquisitions you made. Let me try to go through each of them with you. One of the first ones was Pixar. You Disney had a complicated relationship with Pixar. How did you convince Steve Jobs to sell you Pixar. And was that an easy decision to convince the board to buy Pixar and what was thought to be a pretty high price. Yeah. We paid over seven billion dollars for Pixar and it was an idea that I had right out right away. In fact I laid that idea on the table to the board in my first meeting as CEO with a company which I'm not sure it's the right way to start. But we had gone through a period of time where Disney animation had been faltering almost a decade and we had a very good six. We had had a lot of success with Pixar in what was basically a joint venture with them that was ending. And Steve Jobs in a very very difficult and kind of in your face manner told us publicly. Meaning he made the announcement public publicly that Pixar our relationship with Disney would end. I felt that I had to address Disney animation that it needed. It needed huge improvement. And I thought the fastest way to accomplish that albeit the riskiest and the most expensive was to buy Pixar not only to bring Pixar in as part of the company but bring the executives in that we'd created all the success of Pixar and have them turn Disney animation around. And that was my pitch to the board. And it took on the board side. It took from October to January January to convince them it was the right thing. And a lot of I used up all the capital I had and they didn't have much because I was a brand new CEO. But I also was able to convince Steve Jobs that it was a good idea when the notion of buying Pixar came to me. I called him up. I was actually quite nervous. I got him on the phone and I said I've got a crazy idea. Can I come up and talk to you about it. I didn't think I should broach the subject on the phone. Well I don't know how well you knew Steve. But anyone who knew Steve would know that if you said to Steve I have a crazy idea. He would have to hear it right away. So the notion that I would say that to him and then say but I'll come up and talk to you is ridiculous. And he made me tell him on the phone like in the middle it's what I had in mind. What was my crazy idea. He said well it's not that crazy. What are we. Why do you come up and we'll talk about it. And that led to a very very interesting discussion with him on the subject us buying Pixar and Steve becoming the largest shareholder of the Walt Disney Company a member of our board and a true friend of mine. That was just a simple result of that process. Right before the Disney board is about to approve the acquisition he tells you something about his health that he has. His cancer had returned. So did you ever think about changing the the procedure proceeding to go forward the deal or not. Yeah actually we were on the Pixar campus basically preparing for the announcement which Steve and I were going to make. And he said can we go for a walk. And he told me that he was going to tell me something that only his wife and his doctors knew. And that was that the cancer that he had had a few years earlier than that he was operated on had come back in a different form. And he wanted me to know it because he wanted me to. He wanted to give me a chance to back out of the deal. At that point I looked at my watch and it was incredible. It was 30 minutes before announcing a seven plus billion dollar deal that everybody that needed to approve it had approved. And I it's not like I had an opportunity to phone anybody and asked for their advice because he demanded confidentiality. And I made a decision kind of on the spot which is that we were buying Pixar there. While Steve was important in the acquisition because he would become a board member and a shareholder. He was not material to the Pixar deal itself. And therefore I thought that I was exercising the right set of responsibilities as the CEO of the company and asking shareholders ultimately to approve a large acquisition. And so while we went to make the announcement with me carrying that incredibly heavy news inside me and it was a secret actually that held for a few years that the world didn't know and that was in early 2006. And he lived until October of 2011. So I had the benefit of not only his friendship and his advice and his position on the board but of the wisdom that Steve Job brought to any room any situation wisdom and an incredible talent and instinct. How Disney has a lot of characters. Donald Duck Mickey Mouse Minnie Mouse so forth. Why did you need to go buy the characters from Marvel Entertainment. That's what's your next big acquisition. Another comic book series of characters. Why did you feel that was such an important deal in 2005. CEO We were starting to see a very very discreet. A huge amount of disruption to our business. And one of the things that mostly thanks to technology and one of the things that new technology was bringing was an explosion of of what was being produced of creativity and consumer choice in the in the entertainment field. And I thought that with so much more consumer choice that high quality branded entertainment would be even more valuable. So after the Pixar acquisition was successful we created a list of acquisition targets at Disney and they all were consistent with what I just laid out. We were looking for high quality branded entertainment and Marvel and Star Wars were at the top of the list. So you then went to talk to George Lucas and said By the way I'd like to buy your company and we will make Star Wars in the future. And you can watch the movie but we're gonna make it. Was that hard for him to give up the the creative creative control of Star Wars. It was. But again you know we saw in Star Wars something that was extraordinary like Marvel and like Pixar and like Disney as I talked earlier. And the difference being that George was the creator of it and the sole shareholder of it. And it was really who he was that I think he explained to me at some point you know when he passes this it will save Star Wars creator George Lucas. This was like selling his birthright. It was an incredibly difficult thing for him. I had a lot of empathy for him. But it was hard. And I don't know whether he has had second thoughts about it. He's never he hasn't expressed that to me. But I would guess that it's worked out really well for him for his family. It's certainly worked out well for us. I can't speak for him but I think he's happy with a stock price increase that he got from from the acquisition. But again I can't speak for him. Let me ask about the last acquisition. You know the ones you've made they weren't what I would call bet your company kinds of acquisitions. They were expensive but they weren't exactly 50 and 60 billion dollar acquisition. So when Rupert Murdoch said he might be interested in selling part of his company did you worry about if it didn't work out it could be the end of your job at the end of your career and things like that. No. Look I've gone into every one of these acquisitions with a level of confidence that not only were they were the right acquisition at the right price but that we could execute the vision that we had when we laid out the reasoning behind the acquisition. Maybe I had too much confidence. I don't know. But so far so good. So now as executive chairman you have a little more free time than maybe when you had the CEO. And if you don't go into the Biden administration what are you going to do to top what you've done and to keep yourself energized. I read you just went onto the board of a new food company. What do you want to do to top what you've already done. I don't really have a need to top what I've done at all. I'm extremely satisfied with what I've accomplished. And I know I wouldn't if I could do it again I wouldn't change anything. I don't think so. I'm really not looking to do that at all. I'm looking for things that are stimulating as I mentioned earlier. Whether that's in the public or the private sector I don't know. So have you considered the highest calling of mankind which is private equity as another career. You know I'm not ruling anything out. I know if private equity is served you extremely well. I've had some feelers from that space. I've not made any decisions about what I do next. I think that I'm very excited about the next chapter. You know I'm sure it will be a sorry day for me to leave Disney because it's been my home for 46 years almost 47 by the time I leave. On the other hand there's a whole world out there and I still have a lot of energy and a lot of huge amount of curiosity. And I'm looking forward to.

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The David Rubenstein Show: Disney Exec. Chairman Bob Iger

Bob Iger, Walt Disney Co. executive chairman and former chief executive officer, talks about what he'll do after he leaves Disney, how he almost ran for U.S. president, and managing through the Covid pandemic. He appears on the latest episode of "The David Rubenstein Show: Peer-to-Peer Conversations." The interview was recorded Nov. 11, 2020. (Corrects audio issue.) (Source: Bloomberg)

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