The reason Disney CEO Bob Iger loves working with startups
Back in 1937, Disney released the first-ever animated feature film: Snow White and The Seven Dwarfs. In 1995, Disney-Pixar released Toy Story, the first-ever computer animated movie.
Just this past weekend, Disney released Tomorrowland, a love letter to classic science fiction that urged viewers to look forward, based on the futuristic themed "land" in its Disneyland and Disneyworld theme parks.
Disney is always looking for the next big thing.
That's why the company is gearing up for the second annual Disney Accelerator program, a startup farm to connect founders with Disney money, Disney intellectual property, and perhaps best of all, access to Disney's team as executive as mentors, up to and including Disney CEO Bob Iger.
"[Disney Accelerator] is a graduate-level class in media and entertainment," says Disney SVP of Innovation and Disney Accelerator head Michael Abrams.
For the startups, the chance to collaborate with Disney - on properties from Marvel superheroes to Star Wars to ESPN to ABC Family to Disneyland to Mickey Mouse - is a major selling point. If nothing else, at least they get a major first customer.
Looking for founders with the "Disney mindset"
In the program, which will begin its 2014 class on July 6th, 10 startups per cohort are invited to work at Disney's Glendale campus in Southern California for 13 weeks and offered $120,000 in funding - $100,000 of which comes in a convertible note that can be changed into equity, at the startup's choice - to build something new and cool.
The administrative and logistical end of the Disney Accelerator is run by Techstars, a Colorado company that specializes in holding these kinds of programs, which it's done for clients like Nike and Barclays. Disney's part in the program is to provide its own expertise in media, interactive entertainment, and all of those others things Disney does well, as it works to support these startups in growing their business.
DisneyThe Disney World MagicBand lets guests check into rides, pay for meals, and open their hotel room doors.To be clear, Disney doesn't think it needs the help of startups to come up with cool new technology.
Abrams describes Disney's "huge labs" where new ideas are conceived, hammered out, and released unto consumers all the time. For instance, Disney came up with the super-cool Magic Band wearable wristlet for the Walt Disney World resort all on its own - even if development came with a pricetag of $1 billion.
But startups are a major source of new ideas that might not have emerged from people working within Disney's giant corporate machine. The Disney Accelerator looks for founders with a "Disney mindset" and a willingness to experiment until they find the right idea.
LinkedInDisney SVP of Innovation Michael Abrams
Disney executives, Iger very much included, love meeting with these startups because they find it "energizing" to deal with people with a more entrepreneurial spirit, working on radical new ideas and "opportunities that weren't obvious at Disney," Abrams says.
In fact, Iger personally advised Sphero, a robotics company that graduated from the Disney Accelerator in the first class and went on to help Lucasfilm design BB-8, the rolling droid from the forthcoming "Star Wars: The Force Awakens."
From that first cohort, ChoreMonster, an app that encourages kids to do their chores by making it a game, is including characters from the upcoming Disney-Pixar movie Inside Out, including the voice talents of star Bill Hader.
Another startup, Narritiv, which makes software to track social media campaigns, helped ABC Family's TV series Pretty Little Liars get a million Snapchat followers. Tyffon developed Show Your Disney Side, an app for Disney's theme parks that lets you morph a selfie into a Disney character.
That approach has been very successful. Most of the 10 companies in the Disney Accelerator program are raising venture capital rounds, he says.
In fact, one startup, SnowShoe, which makes physical stamps that can unlock digital content on a smartphone, raised $2 million in early-stage funding while still in the Disney Accelerator, and then another $1 million almost immediately after demoing their technology at the conclusion of the program.
"The future of media and entertainment is a magnificent thing," Abrams says.