May 19, 2026 • 10 mins
Sometimes failure is actually the mother of success. Take Walt Disney, who at the age of 21 had one animation company go bankrupt. By 27, his taste of success with a cartoon rabbit named Oswald was stolen by a partner who made a deal with an unscrupulous movie studio. So, it turns out Mickey Mouse was born out of desperation and the determination to never give up.
Feel free to DM me if you have a story you’d like me to cover . . on Facebook it’s Patty Steele and on Instagram Real Patty Steele.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Well, what are the things that intrigues me about Looking
at the lives of people who created something larger than
life is exploring how they got there, because, you know what,
everybody has faced challenges along the way. The difference between
them and the rest of us is their ability to
reinvent themselves, to learn from the mistakes and what some
would call failures, and make something bigger and better out
(00:23):
of it. That's the story of Walt Disney. I'm Patty Steele,
from losing his most prized creation along with the team
who helped him get there, to the birth of Mickey Mouse.
That's next on the backstory. We're back with the backstory.
Thomas Edison gave us a quote that always gives me
(00:44):
hope when things aren't exactly going the way I hope
they would. He said, no activity is a failure, just
an attempt to succeed. It's all about never giving up,
just not being afraid to reset your sales when the
wind changes. Okay, it's nineteen twelve. Walt Disney is sitting
alone on a train out of New York City. He's
(01:04):
staring out of the window at the countryside rushing by.
He's exhausted, angry and pretty much broke. Now keep in mind,
at that moment, there is no Walt Disney Empire, no Disneyland,
no Mickey Mouse, no billion dollar movies or movie franchises.
He's just a twenty six year old animator who feels
like his career might already be over. And the most
(01:26):
fascinating part of this, everything he would become, was born
because of the business disaster he had just experienced. It
was so devastating it almost destroyed him. This was the
night Walt Disney almost lost everything. Now to understand the
disaster that recreated him, we have to go back before
(01:47):
Mickey Mouse even existed. It's the nineteen twenties and animation
is still pretty primitive. Cartoons are short, silent, and only
shown before the movie feature gets underway in theaters. Film
studios treat them like disposable filler. But Walt Disney believes
in animation. He thinks it could become something a whole
(02:07):
lot bigger. But he has one problem. He's already failed
once before. In nineteen twenty one, when he was just
nineteen years old, Walt started a company in Kansas City
called Laugh of Graham Films. They produced short cartoons inspired
by fairytales. Walt poured everything into it, energy, money, ambition.
(02:29):
Within two years, it collapsed after his distributor went out
of business. Walt couldn't pay his employees and his company
went bankrupt. It was so bad. At one point he
survived on canned beans and slept in his office since
he couldn't afford rent on his apartment, and he bathed
once a week at the local train station. Now, think
(02:49):
about it. Would you have called it quits at that
point and looked for a steady job. Maybe your parents
would tell you to do that. Well, depressed as he was,
he kept believing. So Wal boarded a train to California
with one suitcase and a dream of starting over in Hollywood.
It was a rough go at first. Almost nobody showed
any interest in animation. It's all about live action movies.
(03:13):
It was early in that game, but movies were exploding
in popularity, Cartoons, cheap novelties. Walt didn't care. Now he's
working with his older brother Roy, and they slowly build
a tiny animation business. Then came the character that finally
changed their luck, Oswald, the Lucky Rabbit. Oswald is cheerful mischievous, expressive,
(03:36):
a huge leap forward compared to other cartoons. The time,
audiences fall in love with him. Universal Pictures distributed the shorts,
and suddenly Walt Disney looks like a rising star. Money
starts coming in, and the future looks terrific. Except for
one thing. Wald had made a major mistake. It turns
(03:57):
out he doesn't actually own Oswald, the rat Universal Studios
does as part of the deal they cut to distribute
the cartoons. Either Walt didn't realize how dangerous that would be,
or he thought his success made him untouchable. So in
nineteen twenty eight, he travels to New York expecting to
negotiate a bigger budget for his Oswald cartoons. Since they're
(04:20):
so successful, Walt assumed he had leverage. But you know
what they say about assuming something. Walt walks into an ambush.
His producer, Charles Mintz, controls the distribution deal and calmly
tells Walt that Universal owns Oswald outright, And it gets worse.
Mince had secretly convinced a bunch of Disney's own animators
(04:43):
to leave the company with him. They ultimatum Walt has
to take a pay cut and give Mince more control
or lose the character entirely. Walt was stunned, but he
believed he could start again, and he refused the deal,
and just like that, Oswald was on. The character he'd
built his future around now belongs to somebody else, along
(05:05):
with most of his staff. But the train ride home
was one of the most important journeys in entertainment history.
Imagine the rhythmic clatter of the tracks beneath the train,
the silence, the humiliation. Walt had gone to New York,
believing he was negotiating from strength. Instead, he discovered they
would attempt to erase him overnight. Despite being a fearless,
(05:29):
unstoppable visionary on that train, he was scared because he
knew if he failed again, he might not get a
third chance. Here's where Walt's strength to move forward kicks in.
During that train ride back to California, he and one
of the few animators that stuck with him of Iworkz,
(05:49):
started brainstorming ideas for a new character to replace Oswald Rabbit. Allegedly,
Walt started sketching a mouse, a mouse he called Mortimer,
but as luck would have it, his wife Lillian hated
the name. Mortimer. She thought it sounded too stuffy. She
suggested the new character should be called Mickey, and thankfully
(06:09):
Walt agreed. Now Here's where this story becomes even more fascinating.
Most importantly, for Wald, he'd learned his lesson Mickey Mouse
wasn't just another cartoon character. He was Walt's survival strategy.
He was obsessed with making sure he never again lost
control of something he created. That fear, which came from
(06:30):
losing Oswald, shaped the company for decades. Ownership became everything,
control became everything. The story was essential to Walt, not
just the animation, and Walt threw himself into Mickey Mouse
with unwavering intensity. At the same time, another revolution was
hitting Hollywood. Sound silent films were dying, Studios were scrambling
(06:56):
to figure out how to add audio. Walt decided to
get everything on it. In late nineteen twenty eight, his
company put out a short called Steamboat Willie. Unlike earlier cartoons,
it had synchronized sound effects and music timed exactly to
the animation. Audiences went nuts over it. It felt magical.
(07:17):
People had never experienced anything like it. Nicky whistled objects,
squeaked rhythmically, the cartoon actually felt alive, and suddenly the
same guy who had nearly lost his company just months
earlier became one of the most innovative figures in Hollywood.
Whalt Disney was just twenty seven years old, and his character,
(07:38):
Mickey Mouse exploded into a cultural phenomenon. Merchandise and comic
strips followed, as did fame. What's amazing is this. If
Walt had successfully negotiated a new deal for Oswald in
New York, Mickey Mouse might never have come to life.
The entire Disney empire was born from failure, and Walt
(08:01):
never forgot the lesson, despite Hollywood telling him it would
never work. He was the first to introduce full length
animated feature films with Snow White, a monumental success. Over
the years, Disney became fiercely protective of intellectual property. The
company guarded characters, stories, and branding aggressively. A lot of
(08:23):
historians think the trauma of losing Oswald shaped the entire
Disney corporate philosophy. And there's another twist. For decades, Oswald
the Lucky Rabbit was separated from Disney entirely and sort
of lost to history, But in a two thousand and
six corporate deal. Almost eighty years after Walt lost him,
(08:43):
Disney got Oswald back in a trade involving TV rights.
The character that nearly destroyed Walt Disney eventually came home. Today,
when people think about Disney, they think about castles, theme parks, streaming, empires,
and just being a kid. But underneath all of it
is an origin story about a failed studio, a stolen character,
(09:05):
a humiliating business betrayal, and a lonely train ride across
America where a desperate animator tried to imagine one last
chance before everything disappeared. Sometimes the biggest empires in history
aren't born from victory. Sometimes they're born from panic and
then the ability to reinvent. I hope you're enjoying The
(09:29):
Backstory with Patty Steele. Please leave a review and follow
or subscribe for free to get new episodes delivered automatically,
and feel free to dm me if you have a
story you'd like me to cover. On Facebook, It's Patty
Steele and on Instagram Real Patty Steele. I'm Patty Steele.
(09:55):
The Backstory is a production of iHeartMedia, Premier Networks, the
Elvis Dan Group, and Steel Trap Productions. Our producer is
Mike Pieseglia. Our writer is Jake Kushner. New episodes are
out every Tuesday and Friday, and feel free to reach
out to me with comments and story suggestions on Instagram
at Reel Patty Steele and on Facebook at Patty Steele.
(10:17):
Thanks for listening to the Backstory with Patty Steele, the
pieces of history you didn't know you needed to know.
Well, what are the things that intrigues me about Looking
at the lives of people who created something larger than
life is exploring how they got there, because, you know what,
everybody has faced challenges along the way. The difference between
them and the rest of us is their ability to
reinvent themselves, to learn from the mistakes and what some
would call failures, and make something bigger and better out
(00:23):
of it. That's the story of Walt Disney. I'm Patty Steele,
from losing his most prized creation along with the team
who helped him get there, to the birth of Mickey Mouse.
That's next on the backstory. We're back with the backstory.
Thomas Edison gave us a quote that always gives me
(00:44):
hope when things aren't exactly going the way I hope
they would. He said, no activity is a failure, just
an attempt to succeed. It's all about never giving up,
just not being afraid to reset your sales when the
wind changes. Okay, it's nineteen twelve. Walt Disney is sitting
alone on a train out of New York City. He's
(01:04):
staring out of the window at the countryside rushing by.
He's exhausted, angry and pretty much broke. Now keep in mind,
at that moment, there is no Walt Disney Empire, no Disneyland,
no Mickey Mouse, no billion dollar movies or movie franchises.
He's just a twenty six year old animator who feels
like his career might already be over. And the most
(01:26):
fascinating part of this, everything he would become, was born
because of the business disaster he had just experienced. It
was so devastating it almost destroyed him. This was the
night Walt Disney almost lost everything. Now to understand the
disaster that recreated him, we have to go back before
(01:47):
Mickey Mouse even existed. It's the nineteen twenties and animation
is still pretty primitive. Cartoons are short, silent, and only
shown before the movie feature gets underway in theaters. Film
studios treat them like disposable filler. But Walt Disney believes
in animation. He thinks it could become something a whole
(02:07):
lot bigger. But he has one problem. He's already failed
once before. In nineteen twenty one, when he was just
nineteen years old, Walt started a company in Kansas City
called Laugh of Graham Films. They produced short cartoons inspired
by fairytales. Walt poured everything into it, energy, money, ambition.
(02:29):
Within two years, it collapsed after his distributor went out
of business. Walt couldn't pay his employees and his company
went bankrupt. It was so bad. At one point he
survived on canned beans and slept in his office since
he couldn't afford rent on his apartment, and he bathed
once a week at the local train station. Now, think
(02:49):
about it. Would you have called it quits at that
point and looked for a steady job. Maybe your parents
would tell you to do that. Well, depressed as he was,
he kept believing. So Wal boarded a train to California
with one suitcase and a dream of starting over in Hollywood.
It was a rough go at first. Almost nobody showed
any interest in animation. It's all about live action movies.
(03:13):
It was early in that game, but movies were exploding
in popularity, Cartoons, cheap novelties. Walt didn't care. Now he's
working with his older brother Roy, and they slowly build
a tiny animation business. Then came the character that finally
changed their luck, Oswald, the Lucky Rabbit. Oswald is cheerful mischievous, expressive,
(03:36):
a huge leap forward compared to other cartoons. The time,
audiences fall in love with him. Universal Pictures distributed the shorts,
and suddenly Walt Disney looks like a rising star. Money
starts coming in, and the future looks terrific. Except for
one thing. Wald had made a major mistake. It turns
(03:57):
out he doesn't actually own Oswald, the rat Universal Studios
does as part of the deal they cut to distribute
the cartoons. Either Walt didn't realize how dangerous that would be,
or he thought his success made him untouchable. So in
nineteen twenty eight, he travels to New York expecting to
negotiate a bigger budget for his Oswald cartoons. Since they're
(04:20):
so successful, Walt assumed he had leverage. But you know
what they say about assuming something. Walt walks into an ambush.
His producer, Charles Mintz, controls the distribution deal and calmly
tells Walt that Universal owns Oswald outright, And it gets worse.
Mince had secretly convinced a bunch of Disney's own animators
(04:43):
to leave the company with him. They ultimatum Walt has
to take a pay cut and give Mince more control
or lose the character entirely. Walt was stunned, but he
believed he could start again, and he refused the deal,
and just like that, Oswald was on. The character he'd
built his future around now belongs to somebody else, along
(05:05):
with most of his staff. But the train ride home
was one of the most important journeys in entertainment history.
Imagine the rhythmic clatter of the tracks beneath the train,
the silence, the humiliation. Walt had gone to New York,
believing he was negotiating from strength. Instead, he discovered they
would attempt to erase him overnight. Despite being a fearless,
(05:29):
unstoppable visionary on that train, he was scared because he
knew if he failed again, he might not get a
third chance. Here's where Walt's strength to move forward kicks in.
During that train ride back to California, he and one
of the few animators that stuck with him of Iworkz,
(05:49):
started brainstorming ideas for a new character to replace Oswald Rabbit. Allegedly,
Walt started sketching a mouse, a mouse he called Mortimer,
but as luck would have it, his wife Lillian hated
the name. Mortimer. She thought it sounded too stuffy. She
suggested the new character should be called Mickey, and thankfully
(06:09):
Walt agreed. Now Here's where this story becomes even more fascinating.
Most importantly, for Wald, he'd learned his lesson Mickey Mouse
wasn't just another cartoon character. He was Walt's survival strategy.
He was obsessed with making sure he never again lost
control of something he created. That fear, which came from
(06:30):
losing Oswald, shaped the company for decades. Ownership became everything,
control became everything. The story was essential to Walt, not
just the animation, and Walt threw himself into Mickey Mouse
with unwavering intensity. At the same time, another revolution was
hitting Hollywood. Sound silent films were dying, Studios were scrambling
(06:56):
to figure out how to add audio. Walt decided to
get everything on it. In late nineteen twenty eight, his
company put out a short called Steamboat Willie. Unlike earlier cartoons,
it had synchronized sound effects and music timed exactly to
the animation. Audiences went nuts over it. It felt magical.
(07:17):
People had never experienced anything like it. Nicky whistled objects,
squeaked rhythmically, the cartoon actually felt alive, and suddenly the
same guy who had nearly lost his company just months
earlier became one of the most innovative figures in Hollywood.
Whalt Disney was just twenty seven years old, and his character,
(07:38):
Mickey Mouse exploded into a cultural phenomenon. Merchandise and comic
strips followed, as did fame. What's amazing is this. If
Walt had successfully negotiated a new deal for Oswald in
New York, Mickey Mouse might never have come to life.
The entire Disney empire was born from failure, and Walt
(08:01):
never forgot the lesson, despite Hollywood telling him it would
never work. He was the first to introduce full length
animated feature films with Snow White, a monumental success. Over
the years, Disney became fiercely protective of intellectual property. The
company guarded characters, stories, and branding aggressively. A lot of
(08:23):
historians think the trauma of losing Oswald shaped the entire
Disney corporate philosophy. And there's another twist. For decades, Oswald
the Lucky Rabbit was separated from Disney entirely and sort
of lost to history, But in a two thousand and
six corporate deal. Almost eighty years after Walt lost him,
(08:43):
Disney got Oswald back in a trade involving TV rights.
The character that nearly destroyed Walt Disney eventually came home. Today,
when people think about Disney, they think about castles, theme parks, streaming, empires,
and just being a kid. But underneath all of it
is an origin story about a failed studio, a stolen character,
(09:05):
a humiliating business betrayal, and a lonely train ride across
America where a desperate animator tried to imagine one last
chance before everything disappeared. Sometimes the biggest empires in history
aren't born from victory. Sometimes they're born from panic and
then the ability to reinvent. I hope you're enjoying The
(09:29):
Backstory with Patty Steele. Please leave a review and follow
or subscribe for free to get new episodes delivered automatically,
and feel free to dm me if you have a
story you'd like me to cover. On Facebook, It's Patty
Steele and on Instagram Real Patty Steele. I'm Patty Steele.
(09:55):
The Backstory is a production of iHeartMedia, Premier Networks, the
Elvis Dan Group, and Steel Trap Productions. Our producer is
Mike Pieseglia. Our writer is Jake Kushner. New episodes are
out every Tuesday and Friday, and feel free to reach
out to me with comments and story suggestions on Instagram
at Reel Patty Steele and on Facebook at Patty Steele.
(10:17):
Thanks for listening to the Backstory with Patty Steele, the
pieces of history you didn't know you needed to know.
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