By 1934, Walter Disney had made a name for himself and his animation studio by producing a number of Mickey Mouse and Silly Symphonies shorts But he wanted to expand his studio by making the first feature-length animated film, Snow White and the Seven Dwarfs. The idea was so preposterous at the time that Walt had to struggle to get the project taken seriously, even among his own family. His brother Roy and wife Lillian both attempted to talk him out of making the picture. The Hollywood film industry began referring to the project as “Disney’s Folly” during production. Walt ended up having to mortgage his house in order to pay for the film, which ended up costing $1,488,422.74, well over a million dollars over the initial estimated budget of $250,000. The film took three years to complete, and made it’s premier on 21 December 1938. Snow White was an instant success, and it’s success led to not only animated films being a thing, Disney’s place in history.
So what if Snow White had flopped?
Obviously, the future of the studio counted on this film. Had it flopped, the first thing that would have happened would have been that Walt Disney’s studio would have gone bankrupt. But that doesn’t mean that that would have been the end for him. Knowing his character, I would imagine that he would not give up and start over from scratch. Perhaps he wouldn’t be taken so seriously the second time around. It’s possible all the classic Mickey Mouse and Silly Symphonies shorts would have been burned or sold off to another company, most likely Universal, seeing as Walt worked for them before starting his own studio, and they also owned the rights to his Oswald the Lucky Rabbit, so they would likely want the whole collection. Classics such as Pinocchio, Fantasia, and Bambi would not have been made, at least not by Disney, and not the way we know them today.
As for animated films in general, the odds that someone else would want to take a chance with something that had already bankrupt a studio are slim. I’m sure animated films would have eventually been made again, but it would have been a long time before anyone would have tried. Perhaps it would have been Walt himself, with his second studio, who takes a second shot at them. That’s assuming he made it that far. The Disney studios might have ceased to exist after Snow White flopped, so it might just live on as a cautionary tale. Universal, of course, would have the most to gain from this, having obtained the Walt Disney collection. When the studio is running low and they need to finance a film, they would simply re-release the old Disney shorts.