For decades, Disney executives never bothered with sequels, apart from the occasional follow-up to an unusual project (The Three Caballeros, which if not exactly a sequel, was meant to follow up Saludos Amigos), or cartoon short (the Winnie the Pooh cartoons in the 1960s.) But in the late 1980s, struggling for ideas that could squeak by the hostile eye of then-chairman Jeffrey Katzenberg, animators proposed creating a full length animated sequel to the studio’s only real success from the 1970s—The Rescuers.
The result, The Rescuers Down Under, provided an opportunity for Disney to test out its new CAPS software, and if not exactly a box office blockbuster, did at least earn back its costs. And it happened to coincide with a sudden growth in the VCR market, along with cheaply made, direct-to-video films. The combination gave Disney executives an idea: cheap, direct to video sequels of their most popular films that could also be shown on their broadcast and cable networks.