Meet The Billionaire Toymaker That Turned 5,000 Toys Into $2 Billion — Ronnen Harary

[00:00:00] Speaker 1: We are with the toy mogul, Ronan Harari. You invented their childhood. The person behind Paw Patrol. [00:00:05] Speaker 2: By 2011, we hit a billion dollars in sales. What's the story behind that? 26% of the toy industry is products from TVs and movies. In the case of Paw Patrol, there's hundreds of different companies that want to put our characters onto their products, and then they'll pay us a royalty as a result of that. In the toy business, there is really no testing. I'll never forget, I saw a kid watching the commercial. I saw the look on his face, deadpan. There was no reaction, and I knew right there it was going to be a failure. I'm sure you guys played with Beyblade as a kid. Yeah. Okay. You're sitting with the guy that passed on Beyblade. [00:00:36] Speaker 3: What was your exact reason for passing on them? [00:00:39] Speaker 2: I took a meeting with Dakar Tomy, and they showed me Beyblade. And they said, what do you think about selling this to North America? I brought it back, and everybody looked down. They were like, spinning tops, spinning tops aren't so cool. So I told them, I said, we're passing. And then six months later, I go back to Japan. I'm like, what's happening with Beyblade? So Beyblade went on to billions of dollars worth of toy sales for Hasbro. [00:00:55] Speaker 4: You flipped the script. Most people build their product, and then they build the show afterwards once there's been product market fit. But with Paw Patrol, you did the opposite. You didn't get anyone to just build the Paw Patrol show. You got the creator of Bob the Builder. One of the best shows of all time. How did you go about making that happen? [00:01:13] Speaker 1: What's going on, everyone? Welcome back to the School of Hard Knocks podcast. I'm James. I'm here with Jack and Josh. And we have an incredible guest for you all today out here in New York City. We are with the toy mogul, Ronan Harari. Okay. You are the first ever Canadian entrepreneur and Canadian billionaire on the Hard Knocks podcast. We're happy to have you here, my friend. I love it. And for those that are watching right now, you invented their childhood, right? You created Bakugan. You're one of the inventors and person behind Paw Patrol. Okay. And you turned that into an empire, essentially, right? [00:01:47] Speaker 2: First of all, I just want to thank you guys for having me on the podcast. And I can't tell you how excited I am to be with you guys because of your age and your energy. You know, you remind me of myself. It's like I'm in a mirror, right? That's awesome. And I'm seeing myself. You know, it's like a flashback from 30 years ago. [00:02:06] Speaker 1: You started your first company at 23 years old. Right out of school. And did you have any idea at the time that the toy company would have turned into a company that's now doing $2 billion a year? It's a publicly traded company now. You guys are doing over $2 billion in revenue. Did you have any idea growing up early on that this toy company would have turned into the empire that it is now? [00:02:25] Speaker 2: You know, when we started the business, we made three mission statements. We said we want to be open to ideas wherever they come from in the world. We want to partner with different people. And we're going to build the company as big as we possibly can. And we never put any numbers on it. And what we did was we just focused one product after another product after another product to get where we are today. And we actually started with really humble beginnings. We started with a product called Earth Buddies. It was kind of like a new age Chia Pet. And it's like a softball. And it's made out of grassy nylon sawdust. It's got a happy face on it. And you put it in water and it grows grass for hair. And that was our first product. We made 5,000 pieces for Mother's Day. And at the end of our first year, we sold a million pieces. And that's how we started. And then we started with another product called Devil Sticks, three-piece chugging set for kids. We did really well with that. And then we had a choice between going into horticulture and going into toys. And we decided to go into toys. But, you know, it was like one product at a time. And I think that that's the most important thing is to take things in the stages and to meet yourself where you're at at that moment in time. And once you start, you don't know what the future is going to bring. And you don't know what the screenplay of your life is going to be. But you can't think too far in advance. So, to answer your questions, no, I never dreamed any of this stuff. [00:03:46] Speaker 3: Ronan, when I look at your story, it kind of reminds me of the three of us of how, you know, you started this business with, you know, somebody that you grew up with, like, as a co-founder. And I think it's interesting how, like, your first product, the EarthBuddy, like, actually was, for relatively at the time, very successful for you guys. And so, how did you, because I feel like a lot of first-time entrepreneurs, they don't get it right. Like, they don't, they don't, they don't have it all figured out. How were you guys able to find success early on with your, you know, first product, like the EarthBuddy and DevilStix and so on? [00:04:18] Speaker 2: You know, we didn't overthink it. And we took an idea, you know, I was talking with your brother before, and we were talking about international and looking for ideas from all around the world. And our first idea came from Israel. And there was an article that was written in the newspaper. My mom sat me down. She, like, translated to me and talked about these six different people that were manufacturing the EarthBuddies. And Israelis, they love, they love boasting. So, they basically told all their numbers. And I added it up, and I added it up to 300,000 pieces in a country of 10 million. And no one was making them in Canada and the United States. So, I went to my business partner, who had just graduated from university, and I was like, we should make these. And he thought I was crazy. He just went to the top business school in the world, not the world, sorry, in Canada. And then eventually it took me two weeks to convince him. And then next thing I knew, we were in, like, Kmart, and we were buying pantyhose, sawdusts, nylons, sorry, and, you know, squiggly eyes. They thought they were a little bit, we were a little bit crazy. And we just said, let's make 5,000 pieces for Mother's Day. And the reason why we said 5,000 pieces was because that was the minimum order quantity for the packaging. And then I got my brother-in-law to help out, and he was an incredible engineer. We gave him profit sharing. He got 5% profit sharing on anything we sold on the earth price. And I got my sister to design the packaging. She got 5% profit sharing. And then we made the 5,000 pieces, and we started selling them in the streets of Toronto. And then we sold 700 pieces, came back in, we had 4,300 still left, and then we hit the pavement. And we were super lucky. We got an order for 26,000 pieces, and then a big order from Kmart Corporation for half a million pieces, which is whole. [00:06:02] Speaker 1: So was Kmart that first massive retailer that you were able to get your products into? Yes. [00:06:08] Speaker 4: And how does that happen? Like, did you meet that gentleman on the street to make that connection happen? Or how did you actually get into Kmart? Like, what's the story behind that? [00:06:17] Speaker 2: Well, basically what happened was the year before, Anton, my business partner, was backpacking in Europe. And he met this guy by the name of Aaron Hermelin. And Aaron Hermelin's father owned the palace in Auburn Hills, where the Detroit Pistons played. And Anton called him, he said, do you have any connections to Kmart Corporation? And Aaron said, sure. He said, we can get you a meeting. So that's how it happened. And for some reason, okay, Anton was doing sales. I was doing operations. But for some reason, I took the sales call. And I woke up at 3.30 in the morning, okay? I woke up at 3.30. And I didn't even think about, like, booking a hotel. I just woke up at 3.30. I get to the appointment at 9 o'clock. And I'm sitting there. It's myself, the rep, Aaron, the buyer, we're in a boardroom. And I do a 30-minute pitch. And he sits there. He doesn't say anything. And then at the end of the 30-minute pitch, he says to me, I'm not the buyer for this product. And I, you know, when I was your age, I was slightly a little bit paranoid. So I was like, you know, like, he's telling me a story I didn't believe him. And I pitched him for another 15 minutes. And then he said, I'm not the buyer for this product. So then I said to him, well, we'll give you the product on consigned sales. If it sells, you know, just pay us. And he said, I'm not the buyer for this product. So I'm like, well, who is the buyer for this product? So he left the boardroom, and he came back and gave me a piece of paper. And on it was written this name, Adrian Zacks. So I shook his hand, and I left. And I didn't even say anything to the other guys. And I start walking around Camerot Corporation. And we've got to remember, like, back in the 90s, Camerot was the largest retail in the world. They were the Walmart. They were the Amazon. And I start walking around this building looking for the buyer. And to my luck, she's sitting at her desk. To my luck, I didn't get kicked out. To my luck, I didn't get kicked out. And I think, like, that's the greatest thing about being young, like being your age. You know, I think people thought that I was like someone's, you know, it was like bringing their child to work day. And, but I was so lucky she was there. She was at her desk. And I pitched her. And she said, I'm going to give you a meeting at 3.30. So I go downstairs. And the guys were like, what happened? I was like, I found the buyer. She gave me a meeting at 3.30. They're like, let's go for lunch. I'm like, lunch. I'm not going anywhere. I stayed in the lobby. And I waited until 3.30. And then she called me up. I went up there. And then the craziest thing happened. First of all, it was like, it was a meeting in her office. It wasn't in a boardroom. It was so intimate. And I walk inside. And as I walk in, there's seven competing products sitting on her shelf. Seven. So I lowered my price instantaneously. I was like, okay, you know, we got a lot of competition happening. And I pitched her. And I told her my whole story. I told her my story about, like, you know, making the Earth Buddies. And where we got the idea. And selling them on the street. And, you know, my business partners. And university. And et cetera, et cetera. And she listened attentively. And then she did the most magical thing. She turned around. And she grabbed this book. And gave it to me. And she said, fill out all this information. I'm going to order 48,000 pieces from you. And if it goes well, I'm ordering half a million for Christmas. [00:09:19] Speaker 4: How did it go? Oh, my gosh. How did it go? [00:09:23] Speaker 2: It went incredible. We shipped every piece. They had a 94% sell-through. It was selling for $4.99 sitting at the front of Kmart at checkout. And over the course of two years, they ordered a million and a half pieces. They ordered another $250,000 for the spring. The Earth Buddy Bunnies for Easter. Yeah. And it was incredible. We shipped every piece. We kept our commitment. [00:09:46] Speaker 4: So one of the things I'm kind of curious about as well is, like, you go from literally buying the supplies yourself. Making the toys yourself. How did you go from that to eventually being able to ship out a quarter million to $500,000 units? Within a short time span. [00:10:05] Speaker 2: It was all people. So my brother-in-law was incredible. He's like an autodact. And he was able to, like, build up the machinery. My third partner, Ben, came into the business as a result of the fact that you just brought up. Because we needed to scale and we needed someone to run the factory. My brother-in-law was just coming. He was working nights. He was a lawyer. And so that's when my third partner, Ben, came in. Which Anton was at Ivy University with. So, first of all, I met Ben. It was the craziest thing. Ben comes into the office. He's the most likable guy you'll ever meet. Okay. And within 45 minutes, we had a profit-sharing handshake deal. And then he went off and he started running the factory. And then we were, we also had a very magical thing. When we started, we started hiring people from a homeless shelter. Okay. That's where we first went to get workers. And then afterwards, we went to some other outplacement agencies. But there was two people from the homeless shelter. And one of them, his name is Bob Wakelum. And he was working the factory on the line. And one day, he walks into Ben's office. And he says to Ben, you know, I ran manufacturing for, like, 20 years. And Ben was like, oh, that's amazing. And the next day, Ben walks into his office. And he sees these incredible Gantt charts up on the wall. And Bob basically took over working with Ben on running the manufacturing. And so he was like a savant when he came to manufacturing. And he figured out all the line flow. And he balanced everything out. And so it was just a combination of just incredible people coming together. And just this will to make it happen. And we moved factories. [00:11:38] Speaker 4: And, you know, it was just exciting. It was like. Well, I think what's really interesting about that is you took a, an individual who's really unlikely to be the savant. You know, someone who's from a homeless shelter. Correct. Ended up being the, pretty much the savant of your logistics. Correct. Is it safe to say you changed his life? [00:11:55] Speaker 2: Oh, for sure. Him and Grenville, they moved out of the homeless shelter. And they got apartments and got back, got their life back together. [00:12:02] Speaker 1: One of the things that we were talking about earlier was one of the biggest things for your success was finding great people that were very talented. You mentioned that out of your three partners, you were the most entrepreneurial out of the three. What would you say was kind of your superpower in running and growing the business? Were you the visionary, the guy that was going to pitch all the different people to kind of form those partnerships and whatnot? Where did you kind of double down and hone in your superpower? [00:12:24] Speaker 2: You know, I want to be careful, you know, because my partners were also entrepreneurial. Yeah. I just, you know, I'll tell you a funny story. Like, I just love creation. But my business partners, they went to business school and they were like, let's stick to our knitting. And so as soon as toys started to work, they're like, let's stay with this. And because there was one point where I said to the guys, I'm like, there's this great chicken company in Toronto. I'm like, let's do chicken. And they're like, are you crazy? Let's stick with what we got here. But anyways, it was called Churrasco's Chicken. So tasty. But, you know, what's my superpower? I think that it's my curiosity. I'm so curious about things. And I love to try. And I don't mind failing. And I'm just like, and I just have this, like, I just have this something inside me that says everything's possible. Everything is possible. So that translates into trial. And I was very lucky to get into the toy business because the toy business is all about trial. And so we're constantly bringing out new products every single year. And some of them go and some of them don't go. But you're constantly trying. And then, you know, I really wanted to do TV shows because I was like, that's really cool, like, to be able to tell stories. And so I pushed into entertainment and digital games and that type of stuff. [00:13:46] Speaker 1: I think that you touched on something really important. There was the idea of trying something, implementing something. If it doesn't work, kill it onto the next thing. Did you kind of have something down with your partners where if you guys were to test a new toy, test a new concept, if it didn't hit with the masses, then you would kind of be like, because I think what a lot of a big problem that a lot of entrepreneurs make is they try and do something over and over and over again, and it's just not working. And they're like, they're not going to stop until they get it to work. But eventually, sometimes it doesn't work. So did you kind of have like a method behind, you know, testing out different formats and concepts and stuff like that before you would move on to the next thing? [00:14:22] Speaker 2: Well, it's interesting. In the toy business, there is really no testing. Okay. The only testing is actually getting the product to market. And then, you know, and so I'll never forget. We did this product called Don't Free Freddy. And it was basically this, this monster that's his, his arms were, were closed like this. And then you'd press the button and he'd go like, rah, you start roaring. And I'll never forget, you know, we brought it to market and, um, I saw a kid watching the commercial and I saw the look on his face and he was just so, he was like deadpan. Like, like there was no, no reaction. And I knew right there it was going to be a failure. I just knew that we just didn't connect with, with the product didn't connect with the, with the child. Um, so with us, we, you can't, there is no testing beforehand, right? Because you're not going to get a proper response from a prototype. You're only going to get it from the finished product. Um, but I would say my two business partners deep down inside, they don't get attached to, um, any one product or brand, right? If it doesn't go, our motto is mark it down, clean it up, make sure you don't carry a lot of inventory because the inventory can really kill you in the toy business. Um, and move on to the next. And for some reason, because, and we never really talked about it. Um, there's no blame in our business. Like if a product doesn't do well, we never blame each other. We're just like literally onto the next really, really quickly. Um, and, uh, in the, in the creative business, at the end of the day, there's so many people that are involved in it. So you can never attribute blame. Plus also blame just like slows you down, which is just terrible. But, uh, you know, but the greatest thing is even with, even with the failure is you're, you're learning along the way, which is quite remarkable, but we, but we don't get, we, we don't get attached to, to many things. [00:16:16] Speaker 3: I think you would provide good perspective for the audience maybe to see, because for you guys, you in the toy business, you almost have to build in public. Like if you're, if you're going to, you know, try and, and, and, and potentially fail at something, whether it be a toy or something like that, then you almost, you have to do it publicly. It's like, Hey, we're launching this toy. We're bringing it to market. And if it doesn't work out, we move on is for how many toys would you say, like over the course of your career didn't work out versus those that did that were really big hits. Um, because obviously the winners are the ones that like tell the story and the legacy, but honestly, the ones that didn't work out to me are just as interesting because it's like, Hey, there were probably several ideas that you guys tried, but because you had that mindset to move on to the next thing, uh, without getting so wrapped up and attaching a lot of emotion to it, it allowed you guys to ultimately be successful over and over and over again, because you were just willing to try. [00:17:09] Speaker 2: Yeah. I, I, I like to say if you're batting 600, you're doing, you're doing really well. Yeah. Right. So there's a lot of failures in the, in the other 400. Um, but like, yeah, like when we started, I mean, we had like a string of failures. We had tickle secrets, baby did not do well. We had a don't free Freddy didn't do well. We key charm cuties didn't do well. I mean, there's, there's tons out there, but the greatest thing is that you're actually learning, like with every product that we bring to market, we're meeting new buyers, especially in the early days, we're doing a commercial, we're meeting new factory owners, we're learning about the category. Um, and all of that gets put into, to the future. Um, you know, and then you make mistakes. Like, you know, I, I love sharing how, um, I'm sure you guys paid, played with Bayblade as a kid. Yeah. Okay. Okay. So you're sitting with the guy that passed on Bayblade. So what's the, what's the story behind that? Uh, can I say, I love sitting with you guys. This is so great. Yeah. Uh, basic stories. I started to go to Japan, you know, um, in the early two thousands, looking for products that we could bring to North America. And I was meeting all the toy companies and I took a meeting with Takara Tomy and they showed me Bayblade and they said, what do you think about selling this in North America? And I'm like, kind of looks cool. I'm going to go back and show it to my business partners. I brought it back and everybody looked down there like spinning tops and spinning tops, not so cool. So I told them, I said, we're passing. And then six months later, I go back to Japan. I'm like, what's, what's happening with Bayblade? And they said, oh, it's going great. And what do you mean? They're like, we're creating a TV show around it. It's going to be fantastic. I'm like a TV show. Okay, well maybe, maybe we want to do it now. And they're like, sorry, it's too late. We just did a deal with Hasbro. I'm like, really? [00:18:51] Speaker 4: I'm like, that's a huge competitive years as well, isn't it? Yeah. And we were a smaller company at the time. Yeah. [00:18:57] Speaker 2: And I was like, but you didn't tell me about the TV show. And they were like, sorry, it's, it's done. And so Bayblade went on to do billions of dollars worth of toy sales for Hasbro. It's been running now for 26 years. It'll probably run for another 26 years. We missed it. But that, first of all, that, that miss was like imprinted in me. And that's, this is the greatest thing about failure is that not an intellectual failure, but like something that you, you passed on or you tried and you see the results of. And boy, did I see the results of this? Cause I like, you know, I saw it hit the market and I was doing super well, but like that got imprinted on me and, and that's laid the stages for a product that we launched called Bakugan, which I don't know if you guys played with when you were kids. Absolutely. Yeah. [00:19:49] Speaker 3: James and I grew up in Korea. So it was a big deal over there. Right. [00:19:52] Speaker 2: So if we went to pass on Beyblade, we would have never created Bakugan. So the failures lead to potentially your success in the future. [00:20:00] Speaker 3: Was there something that you were looking for? Like, for example, for the Beyblade deal, like what was your exact reason for passing on them? Like what was about that deal and that structure for that toy that you were just kind of like, I don't necessarily see this panning out. Like what, I just want to kind of see what was your thought process and mindset during that time versus like, obviously what you learned from that. And when you came across Bakugan that you were just kind of like, Hey, this, this is a toy that I really want to go all in on. [00:20:26] Speaker 2: I think it was just an intuitive miss that spinning tops would not capture the hearts and minds of kids. And I think that we saw it in a bit of a raw stage. And I think that our failure was also not believing in Takara Tomi and their ability to develop it and that they would have nailed it, right? Which they did. And having faith that they'll get there in the development process. So managing those two things together just led us to intuitively, you know, use our intellect a little bit more than our intuition. Because we thought spinning tops were not that cool. But the way they executed it was really cool. And the materials that they used were amazing. And the amount of velocity of spinning they can create through the ripcord was incredible. And I think I saw a much earlier prototype that didn't fully represent the finished product. [00:21:20] Speaker 1: And how did the ideation for Bakugan even begin? Like what was that process even like? [00:21:26] Speaker 2: Well, Bakugan was amazing. So my third partner, Ben, his main role was meeting with these toy inventors. So in the toy industry, there's hundreds of toy inventors that they invent toys for a living, but they don't commercialize them. And so the greatest thing is that you can tap into this brain trust of hundreds of people who are showing you thousands of ideas every single year. And if you decide to go with one and you allocate the capital to it, you pay them a 5% royalty on the wholesale in perpetuity. So that's the construct. And there was this gentleman, his name was Shelley Goldberg. He was in his 50s. And he repped toy inventors. And the one guy he repped was this young guy who was 23 years old, basically your age. Jack, how old are you? I'm 26. You're 27. Are you older? I am older. You got like the baby face. I know I do. And Josh? I'm 27. You're 27. Okay. So I have to meet the parents. [00:22:16] Speaker 3: For sure. [00:22:17] Speaker 2: Where you guys live? [00:22:18] Speaker 3: Our parents live in San Antonio, but we're based in Austin. [00:22:21] Speaker 2: I need a dinner in San Antonio. Let's do it. With the parentals. We'll make it happen. So basically, there was this young guy. He's 23. Okay. His name is Aldrich. And he was a first-time inventor. Okay. And he came up with this idea of putting an action figure in a marble. And he didn't have a prototype. He just had drawings. Tons and tons of drawings that he drew himself. And Ben Dermer, who was working with my other partner, Ben, he saw it. And he was like, wow, that's super cool. Like marbles are like an eternal play pattern. And no one's ever put an action figure in a marble. So we licensed it. And that's where it started. And we did a whole bunch of development. And the best that we could do with our capabilities at the time was a ball. And you'd have to like open it manually and then see the action figure inside and open up the action figure. And I was like, and we did some packaging. And we called it like Battle Brawlers. That was our original name. It wasn't great. And I looked at it and I was like, guys, like we got to do better than this. And had the idea to go to Japan and potentially partner with someone over there. And so I got on a plane, flew to Japan, and I pitched Tomy. I said, here's what we got. Do you guys want to partner on the development with us? And they said no. And I went to Bandai, did the same thing. And they said no. And then I went to Sega Toys, which was run by Mr. Cocobun, who doesn't speak a stitch of English. Okay. He doesn't speak any English. And I'm sitting there with a translator and I show him the product, what we did. And I said, do you want to partner with us? And he said, yes. And he said, come back in three months. And they come back in three months. And I was like, wow. And they put the, they took what we made and they put the spring inside and the magnet. And they had the card and the name and the whole battling construct. And you'd roll it and popped open and transformed. And I was like, wow, that is magic. That's just unbelievable. Like they just, it was incredible. All these different characters. And then I looked at him and this is my Beyblade moment. This was my moment. This was my TV moment. And I said to him, what do you think about doing a TV show? Because Beyblade did a TV show. And he's like, okay, it's going to cost $12 million. Do you have six? And I said to him, okay, I need three months. I need some time. And I went back home and spoke to my business partners. And then we did a deal with a Canadian broadcaster because we wanted to have at least one place where the TV show would air in North America. And I went back. And I said to him, okay, we're in for six. And we created the show. Ended up selling it to Cartoon Network in 2008. And brought it out and went on to become this billion-dollar franchise. It played in 150 countries around the world. And we sold it for four years. And it was just, it was incredible. It took our company from, we were doing $450 million in sales at the time that we launched Buckingham in 2008. And by 2011, we hit a billion dollars in sales. Wow. [00:25:23] Speaker 1: I'm curious with toys. When you think about the levers that really make toys that global phenomenon, right? Like, for some reason, what's been coming to my mind during this podcast has been, do you ever remember Danibals? Danibals? Danibals. It was that, like, drinkable yogurt. Yeah, the drink Danibals. Danibals. And they had all these, like, commercials with, like, young childhood actors that were very popular. And it blew them up. What did you say, like, was the biggest lever that you pulled across, you know, the toys that really hit, the commonalities? Was it packaging? Was it the actual fact that they, like, the Bakugans expanded? Was it, like, an innovative marketing campaign? Like, what would you say in common with most of those toys that hit become those global phenomenons? What do they have in common? [00:26:12] Speaker 2: You know, I think it really depends, like, but kids are always, you're, we're looking for the pixie dust, right? That's a term that we latch on to. It's like you're looking for that intangible, the magic, that you're looking for something that's got some feedback to it where there's a wow, where there's something that's, like, unexpected that you wouldn't expect or something you couldn't imagine. And that just opens up the imagination. So it's just that feedback. And then sometimes, you know, with, like, Devil Six, our second product, that was a great product and it was actually being around for a long period of time. But something was in the zeitgeist. You know, there's something, the kids were playing with it. And when kids are playing with a lot of something, you know, you just get that, you know, multiplier effect to it. But at the end of the day, it's, like, it's a real art and science. You want to know what's happened in the past in the toy industry, what's done well, what hasn't done well. And then you want to really be acute to what you're bringing to market. Is there something different and unexpected that hasn't been done before? And if you're going to bring more of the same, the chance of you connecting with the kids is very low. [00:27:20] Speaker ?: 100%. Yeah. [00:27:22] Speaker 3: Well, I was going to ask because I know that you guys acquired Rubik's Cube at one point in time, which I'm a huge fan of. Like, I used to, all of them. Can you do it all? I can. I can do it. Awesome. So, I'm curious for you, what did you look for when you were going to acquire a toy franchise, per se? Like, for example, with Rubik's Cube, like, what was kind of, like, your mindset when you guys acquired Rubik's Cube for, like, 50 million or something like that? Like, you acquired them for, like, when you guys are thinking about, like, okay, well, this toy is obviously a massive hit. How do you go about acquiring them? [00:27:56] Speaker 2: You know, for us, we're always looking for the special brands that have super high awareness. And so, something like Rubik's Cube, it's got, like, a 95%, you know, brand, unaided brand awareness. And so, brands like that. And when you say brand awareness, what do you mean by that? I mean, like, you can talk to anybody on the street and say, do you know the Rubik's Cube? Yep. Right? If you ask 100 people, 95 will probably say that they know it. Yep. Right? So, that's weird. And you don't need to show it to them. Right? It's unaided brand awareness. [00:28:24] Speaker 1: I don't think about that damn Cube. This is the name. Yeah. [00:28:26] Speaker 2: So, I bet you if you took the Cube and you showed it to them, you'd probably get 100%. Yeah. All right? So, you have an incredible name. And our company is very well known for innovation. So, we're always looking for things, brands we can buy, and that we can fuse it with our innovation to actually expand the brand out. And it's very rare that they come along. Because we got into toy business very late. And, you know, Mattel and Hasbro acquired all the most famous brands. And that's why we had to develop our own from scratch. But when some come available, we try to buy them at the right price. [00:29:03] Speaker 4: Why would a company like Rubik's Cube want to sell? [00:29:06] Speaker 2: You know, everybody's got different stories, backgrounds. Rubik's Cube was actually owned by four individuals. And they had a very unique way of, they didn't sell it themselves. They were with a distributor. And there was four partners involved. And I think at a certain point, they wanted to just go their own way. And my business partner, Anton, was doing M&A for many, many years. And he's very talented. And he's incredible at relationships. And that's the most important thing. It's like, he had the relationship with the Rubik's Cube folks for over 10 years. And when they were ready to sell, you know, it wasn't like we were just calling them up. Like, he knew them very, very well. And they felt comfortable with us. And it was also a bit of a complicated transaction. But it was just time and place. Time and place. [00:29:56] Speaker 1: One of the things that fascinates me the most about your business model, in particular with these toys, is you kind of created like a little bit of a universe around them, right? Like when you think about Bakugan, right? You had the TV show. You had the toys. You had the merchandise. You had the licensing, right? You had all these different verticals. Can you kind of break down exactly the business model and like how profitable each of those different verticals are? [00:30:20] Speaker 2: Yeah, I mean, I think for us, you know, there's three parts to Spin Master. There's the toy business. There's the entertainment business. And there's the digital game business. And they're very distinct entities into themselves. The entertainment part of the business gives you the ability to create stories and characters. And if you are fortunate enough to create a story and a character that resonates with kids, and we've created 10 shows in our career, and eight have not resonated with kids. They've done well, but the kids did not want to bring them into their life. And when I say bring them into their life, they didn't want to buy the toys. They didn't want the T-shirts and the bedding and all that type of stuff. But if you can create characters and television shows whereby the kids do want to bring them into their life, then you have the ability to actually license them out. And when you license them out, you can have, like in the case of Paw Patrol, you know, there's hundreds of different companies that want to put our characters onto their products, and then they'll pay us a royalty as a result of that. [00:31:24] Speaker 1: It's honestly, like when you think about it, like there's people that have Paw Patrol bedding at home, and it's like there's just so many different ways that you can tap into that. Like I can only imagine the amount of people that reached out to you because it's one of the biggest, you know, shows in the world for young kids. [00:31:37] Speaker 2: Yeah, so for us, it's kind of like it's the Disney model. That's what they do. You know, Disney's not a manufacturer, actually. They don't manufacture anything. They create these incredible movies and incredible shows, and then they get other people to create products around their characters. So we started as a toy company, and it was really out of necessity because, you know, we were younger, like you guys, and every time we went to get a license from a Disney or a Warner Brothers, we got turned down. It always went to our larger competitors. And 26% of the toy industry is products from TVs and movies, right? So it's a quarter. A quarter of the products on the shelf in the toy category come from licenses. And I love your brother. Anyway, so we were like we couldn't get the licenses. And so we were at a disadvantage. So we said, you know what, let's go do it ourselves. And so we started creating our own TV shows, and then that opened up a whole other revenue stream for us. And then, of course, we make our own toys for Paw Patrol and other TV shows that we bring to market. So we're a hybrid kind of like between a smaller Disney and a toy company combined. [00:32:52] Speaker 1: I just love the three dimensions that you had. You mentioned it was toys, it was the shows, and then it was the digital games. I just love that you have the different verticals. [00:33:00] Speaker 2: Yeah. And then digital games is wild. We tried to open up our own studio in 2010. We had 100 people in a studio producing a virtual world interactive for TechDeck, which is one of our brands. So it was this incredible skateboarding game. And we were like $10 million in, and we shut it down. [00:33:19] Speaker 1: We're going to know who we're interviewing later is the CEO of 2Take Interactive. Oh, no way. Strasse Zelnick. They do GTA, Grand Theft Auto. Oh, that's so cool. [00:33:26] Speaker 4: Yeah. So one of the things I think is super fascinating is the fact that you flipped the script, especially early on in the career. Most people build their product, and then they build the show afterwards once there's been product market fit. But with Paw Patrol, you did the opposite. You led with the story, and then you built the toys after the fact. But the most interesting part about all of that is that you didn't get anyone to just build the Paw Patrol show. You got the creator of Bob the Builder. [00:33:56] Speaker 2: That's correct. [00:33:57] Speaker 4: One of the best shows of all time. I watched Bob the Builder all the time as a kid. [00:34:01] Speaker 2: I watched him as an adult. I love it. [00:34:03] Speaker 4: And how did you go about making that happen? And what's the story of partnering with the creator of Bob the Builder for Paw Patrol? [00:34:11] Speaker 2: Well, after Bakugan, Bakugan actually was a blessing and an incredible learning. But after Bakugan, we went up to a billion dollars in sales. We actually went back down to $450 million in sales. And we said we wanted to stay with this whole entertainment thing. And we produced a couple of other shows, three other shows, and they actually followed on Bakugan. And they all did terribly. Like you literally could not give the product away. Okay. Give the product away. You cannot give the product away. Okay. Well, what am I saying? This is great. [00:34:51] Speaker 1: You know, it's funny. It's just a hard reality sometimes. Yeah, it's a hard reality. [00:34:54] Speaker 2: Okay. Like when you walk into retail, okay, and you see the shelves are full, and you go back a week later, and they're still full. And a week later, and they're still full. And they're still full. And they're still full. And it's like, you're almost like, is there like a glue on there or something? [00:35:05] Speaker 1: Like, what's, like, what's, like, what's, like, what's, like, in other words, you could [00:35:08] Speaker 2: pay somebody to take your product away. Yeah, you couldn't pay. No, you couldn't pay. You couldn't pay. You know, we had this TV show. I worked on it for two years. It was called Redikai. It was all about trading cards. Okay. It just didn't go. We did another one with a Japanese company. Okay. It was called Tenkai Nights. Okay. It just didn't go. Okay. And we were at our lowest point, actually, when Paw Patrol was born. And we said, let's try something in preschool. And so we learned something about, you know, you asked about, like, what makes toys special. So you're always looking for, like, the play pattern. And there's something so magical about transformation. And so we said, you know, in the whole era of preschool, there wasn't, like, a, there wasn't a lot of shows that were connecting with kids. So we saw a white space opportunity, plus also there was nothing that was ever done around transformation for preschoolers. So we created this brief. And we said, let's do a show around transformation for preschoolers. That was a brief. It was very simple. And we sent it around to five creators around the world. And Keith was one of them. And Keith basically came back. He did not follow the brief. Okay. There was nothing around transformation there. But what he did was he came with this incredible idea of these five dogs that go on rescue, these five puppies that go on rescue missions. And they have an incredible leader. And it was originally called Robbie and the Rescue Pups. Okay. And we just loved the idea. Plus, also, I'm like you. Like, I love Keith. And I love, I have a whole thing. I love being around lucky people. All right. The more lucky people you can bring into your life, okay, the more luck you get. And I was like, I was dying to work with them for many, many years. So, it was a combination of that. [00:36:50] Speaker 1: When you say lucky people, what do you mean by that? [00:36:54] Speaker 2: I mean people that have done exceptional things in their life. And actually, I take the back. It doesn't necessarily have to be exceptional things. Because it's just, I would say people that have a sense of ease about themselves and a nice way about themselves and feel very comfortable with who they are as a person. And you feel great being around them. And you just like their energy. And then you look at sometimes people's body of work and what they've done. And there's an appreciation for that. And I connect luck to that in a way. So, Keith was, he's just an incredible human being. So, he was a great human being. He had a great concept. He kind of missed the brief. But then we added all the transformation back into it. And what happened was, we started to assemble the most incredible cast of Canadians. So, Paw Patrol is a Canadian show. The director, Jamie Whitney, he's an incredible human being. And he had directed some of the most amazing kids' shows. And he signed on to direct Paw Patrol. We found two incredible writers. We found an incredible animation studio called Guru. And we started working on developing the show with them and the look of the characters and the archetypes. And then we did something that many people don't do. But because we were working with the Japanese for so many years, the Japanese are the masters of fusing multiple art forms at the same time. And they fuse toy development with TV development at the same time. And so we said, let's try it ourselves as being students of what they've done in the past. And so our toy designers worked with the animators. And they collaborated together. And it was rough for a while because sometimes some of the animators were like, why do you have this toy designer drawing over my animation? And vice versa. But it was the fusion of the art form that really was able to, I think, create the magic at the end of the day. And it was just great people coming together. [00:39:06] Speaker 4: So you built this incredible entertainment platform via the show. But how do you go about turning viewers of a TV show, which are kids, they can't even buy the product, right, into actual customers? Is it running ads throughout the show? Is it relying on them to just see the product when they go to the store? Like, how do you actually make the call to action for them to actually want your product? [00:39:29] Speaker 2: So we ended up selling the show to Nickelodeon in 2013. And it was unbelievable. It was slightly different to Kmart. But we went in there. It was myself, Keith Chapman, Jen Dodge, a few of us, and Seema Zangarmi, who was president of Nickelodeon. She liked it. And we actually, they helped us with the development of the show, too. So once we put it on, it was on Nickelodeon, they promoted it on their channels. And they're one of the greatest people for children's programming in the world. So they were constantly promoting it in different ways to get people to tune in and to watch. You know, at the time, that was linear TV was really popular. So it was like, come in at 3.30 and see Paw Patrol, and this is going to be the episode, etc., etc. So that was one event, one part. But I think at the end of the day, it was the show itself and the way the show was written. And it's the pacing and the characters. It's the archetypes of all the different characters. And that just connects with kids because it's more about them just seeing the show and liking it that really gives it the ability to, like, live on. Plus, we did other things like we, every year, we put out a new season, right? So there's always new stories. And within every season, there's 13 specials, right, with different themes in there. And we were the first people to do themes within shows. So we were innovating within the show itself. [00:40:59] Speaker 4: Special characters and people, like, special toys that people can buy as well. [00:41:02] Speaker 2: Special toys, but also special characters, like Everest, okay, and you had, you know, I'm forgetting some names there. But, yeah, we bring in special characters, and we just kept everything fresh, right? We were also one of the first people to ever do a motion picture for a preschool show. And people thought we were crazy. [00:41:28] Speaker 4: Well, I think that's just a testament to that. [00:41:30] Speaker 2: But it's like a span. But it was all for the kids because we were able to tell a bigger story. And so it's just constantly keeping the franchise fresh and different for the kids. [00:41:40] Speaker 1: One of the things that you've done consistently throughout your career in building this company, building this empire that you have today, is doing global business, which is one of the things that we are very passionate about. I think I would attribute one of the reasons why we've been able to grow to over 23 billion followers is because a lot of these interviews that we're doing, we've taken to international. I told you that next week we're going to Monaco and Nigeria. I know I want to come with you. Come on. But it's simply oftentimes the things that people just aren't doing. And I would say even probably in the toy business, probably 95% of it, maybe I'm wrong, but the majority of toy companies that are in America, they're not thinking about going out to Japan to go meet with some of the heavy hitters out there, which is what you did. What are some of the things that you've learned from doing business overseas in your career? If there's any lessons that really come to mind, and also maybe the best way that you recommend going to do that, going to connect with the decision makers overseas at the top of their industries. [00:42:33] Speaker 2: Listen, I think that if you don't go, you don't get. The magic happens outside the office. And I think that if you can afford it, go to as many trade shows as you possibly can year after year after year after year and put in the time and effort. You know, I did probably 10 trips to Japan before we did a stitch of business, right? And so don't expect that everything's going to happen straight away. People need to see you. They need to see you. Especially like Japan's like the best case example of this, right? But once you've done business over there and once they've seen you many times, the trust goes up. And once you have their trust, it's forever. It's 100% forever. So wherever it is in the world, put in the time and effort to actually do the work and don't expect magical things to happen straight away. But you're going to build contacts. You're going to build relationships and real relationships. And you'll have a great time doing it. And then you're going to do and then you're going to learn. And then the opportunities are going to start coming your way. And then your ability to connect the dots is also going to go up, right? So it's a combination between all those things. [00:43:40] Speaker 1: A great friend of ours, his name is James Keyes. He was the former CEO of 7-Eleven. And he eventually sold 7-Eleven to a massive oil company in Japan. And he talked about how the Japanese, like one of the things that, you know, we asked him about, like, what did you learn from how they do business? He said that they're very big on win-win business. Would you confirm? Is that pretty true that like that's kind of like how they do business, how they negotiate over there? Is it very, like, much of a win-win or did you learn any other lessons from doing business in Japan? [00:44:08] Speaker 2: Japan, it's all about collaboration. It's all about, it's 100% win-wins, collaboration. And they're in for the long term, right? I have, when we did Tenkai Nights, that TV show that didn't do work, it didn't do well, the CEO of that company, we had the deal. Everything was finalized. He flew all the way from Japan to come to Toronto to have the final signing dinner. And then he got on the plane the next morning and he flew back. He wanted to do it in person. [00:44:39] Speaker ?: Wow. [00:44:40] Speaker 2: Yeah. And he was not that young. Okay. I was like, that is a long way to go. [00:44:45] Speaker 1: It was a brutal flight. [00:44:45] Speaker 2: It was a brutal flight. But he, for them, it's, and it's all about the in-person, right? So to your point about, like, the international, especially in Europe and Asia, Asia for sure. They want to see you all the time, right? The other thing is, like, we were so lucky in the early days. Our first trip to Hong Kong, we got to meet the best vendors. I'll never forget. Ben and I got picked up in a Rolls Royce and taken for lunch. We were your age. We were 25, okay? And we were, like, in this guy's Rolls, okay? We were in a Rolls Royce going to lunch. Because in Asia, Asia, they're, like, especially in Hong Kong, they believe in karma. And it's, like, if you've called them up, if you've taken the effort to call them and you've taken the effort to fly over there, they're, like, something's here. I'm not going to miss this opportunity. And they don't question. They're, like, this person's showing up. There's something here, right? It's something that just, like, flew into my nest. And so being in person in Asia is everything. It's all about face there. And Europe also, like, Europe, you know, like, much more slow pace. You know, they want to spend time. They're not, like, you know, us North Americans, like, chop, chop, let's get the deal done, you know? They want to, like, it's more nuanced. Like, let's spend more time. Like, you know, you go to France. Like, let's sit. We'll drink a bottle of wine, you know, and chat. And it's, like, but it's, I would say it's the most wonderful thing because it's boring. Just, you know, if you're just doing business with the same people all the time, plus also the ideas, the richness of ideas, it's incredible. [00:46:16] Speaker 1: Yeah, and, you know, you talk about how the most important decision somebody has to make for themselves is whether or not they want to be in business for themselves. But I think what was fascinating when we were talking earlier was that you said that the minute somebody decides that they want to be in business for themselves, if they don't have that idea, what did you recommend them do? Get on a plane and travel. Just go get inspiration. [00:46:37] Speaker 2: So, yeah, I mean, I don't talk about it very often, but I had one side gig, okay? I had one solo album. I have two solo albums. One is the book that I wrote now, but I had one solo album, which is, I opened up a bakery. It's called Broadflower, okay? And it's in Toronto, and it's, and I always had this, I love, I love the smell of bread, okay? Right? And since the guys didn't let me do the chicken business, I was like, eventually I did a bread business. But I, and so I met this woman, and she was in the food business, and I told her, you know, I said, I really want to open up this bakery because I love the smell of bread, and I love architecture and design, and we can, you know, why can't someone walk in and buy a coffee and get a loaf of bread at the same time? Kind of like the European mentality. But anyways, long story short is that before we started, I said to her, so she was going to run the business. So she came in, I gave her, I gave her a sweat equity in the business, and I said, the first thing you need to do is you need to travel the world for two months. And that's what she did. Kind of a sweet gig. Yeah, sweet gig. That's my, that's what my friends tell me. That's a great gig. [00:47:42] Speaker 4: Oh, don't, don't tell me, you know, I guess I'll struggle to fly around the world for two months, you know? Yeah. So. [00:47:48] Speaker 2: But it was the most magical thing because she went, she was, she went to the West Coast, and she learned that people are milling, okay, their own flour in the bakery, okay? And that you get the healthiest bread and you can get by milling it. And so we started to mill our own, uh, wheat. Then she went to Europe and she met a guy in Copenhagen, uh, sorry, in Gothenburg in Sweden who had the number one bakery. And we got his, all his recipes. We got his starter, okay, which if anybody knows about sourdough, you know, it's all about the starter. The starter was going for 15 years and he gave us his starter and he gave us all his recipes. And our bread is basically Swedish bread. So it's Swedish bread, milling, which we, we learned about. Then we, we, we sourced farms out in Canada and everything was a result of traveling around the world. And we were able to piece it together. And, um, and, uh, anyways, then we opened the bakery, then COVID hit and kept it going. And we have like one small bakery in Toronto. It's a bit of a cult classic. Uh, but I would attribute the, the foundation of that to the fact that she went around the world and traveled and, and gleaned the knowledge. And we didn't, and we didn't have to, we didn't, we didn't have to, we didn't have to, we didn't have to invent any ideas. We just had to see what was doing well in other locations and meet people that would actually help us. [00:49:13] Speaker 1: And why did you write a book? [00:49:15] Speaker 2: I wrote a book because it was an idea that was like wanting to come out. What's the name of it? It's called No Experience Necessary. Okay. And, uh, uh, it's a theory that I have that your twenties is your best decade to bet on yourself. Um, and if you're inclined to start a business, that's just a wonderful time to start. And I just wanted to share my, my, um, my thesis and my look back on, on my twenties. [00:49:46] Speaker 4: Why, why do you think that is the best decade to start a business? [00:49:51] Speaker 2: I think that there's a number of factors, um, over and above the fact that you have like crazy amounts of energy. Um, everybody's rooting for you when you're young, right? When you're younger, okay, like everybody wants to help you. Everybody wants to succeed. Um, I'll never forget the late Alan Hasenfeld from the Hasbro family. You know, when we were 25 years old, he took our calls. He gave us time. He was so excited to have young guys in the toy industry. He didn't see us as competition. Um, there's, there's a whole thing about, um, power of not knowing, right? Sometimes when you know too much and you intellectualize things, then you kind of get stuck and we get stuck, you know, like doubt is like the anti-luck. Um, and there's a lot of, uh, there's a lot in that. Like when we launched Air Hogs, um, we didn't realize that Air Hogs was pitched to every toy company, Hasbro, Mattel, and they all turned it down. And the fact that we didn't know about that gave us, gave us the, we didn't even like, we just loved the product. We just loved the product. You know, we were like seven year old kids flying the prototype from the inventor. Um, and we didn't know, we, we knew intuitively, you know, it's a spinning propeller and, you know, it's a plane and crashes and, and there may be returns, but we didn't overthink it that much. We were like, there's a way we will, we'll figure it out. Um, and so I think a little bit of that naivety plays to your, to your, to your, uh, to your side, to your success. Um, and, uh, you know, I think also the, the, the, your ability to fail, um, your resilience, I think it's super high and there's something in the resilience in there. And there's also like, you can compound, you have just, you just have a longer runway room to try and to do things and to build up a body of knowledge. [00:51:48] Speaker 4: I feel like, uh, one of those things as well is just like, especially in your early twenties, there's just not as much, like, like people have roots, right. As they grow older, they have a family, they have kids, they have debt. And you, and when you're in your twenties, you can just take that risk. I mean, obviously like nothing's guaranteed, but that's like, I feel like from, for us personally, like, Hey, if you fail, like you still have your whole, your whole life ahead of you. So it's, it's okay to go ahead and do that. But I feel like I'd rather live with knowing that I tried and failed than living with the regret of what if. [00:52:21] Speaker 1: For sure. I also love too that he possesses the mentality of sell it first and figure it out. There's a, there's a quote that we love, sell it first and figure it out. You're, you're 55 today and you never did a PowerPoint presentation. And I love that because what, and the answer is what, why so many entrepreneurs, why they fail or never take the leap that it has to be perfect. I have to have the perfect camera. It's like, we started this with, we used our phones as a microphone. You know what I mean? So it's like, there's so much power in that, that it's like, if you, you just got to go. [00:52:52] Speaker 2: There's a power in the starting. There's a power in the, there's a huge power in the unlock. And it's just making that decision. Like, do you want to be in business for yourself? Just make that decision. And that's, that is actually almost everything. And it's almost more than what you're going to do because you unleash a whole amount of energy there. And if you sit on the sidelines in the middle, it's like the universe is never, it's never going to meet you. And, uh, you know, I love what you said before because you, once you start, like you unlock so many things and you, and you're starting to see the, you're, you're building the screenplay of your life right now. You'll look back, you know, I want to interview you guys like in 20 years, I love what you [00:53:32] Speaker 3: said in your message, just to those that are in their twenties or they're in their teens and they're getting ready to enter their twenties because like now is the best time to start because, you know, it's only going to get harder as you get older with the responsibilities. People get married, they have kids and it's like, you know, some people, you know, even they are in their young twenties and things like that. And they already have those responsibilities, but the majority don't. And so like this, like this decade is the time to really go all in. I wanted to ask you guys, I have a bit of a fun question. Um, but obviously if you, if anybody's familiar with the new toy story five, that's coming out, uh, with, with, uh, you know, the girl has the iPad and the iPads, the villain for the toys, where do you kind of see the future of the toy business going? Uh, cause I, what I love about your business is that you develop the entertainment arm. You have the digital games arm. And so of course, like just beyond toys, like you're already adapted into like those markets, of course, but like, where do you see the future of toys? Do you think, uh, over the next 20 years, they're, they're still going to be super prevalent in young kids' lives? Or do you think the iPad is really the villain here? [00:54:37] Speaker 2: You know, uh, you know, it's amazing that they made it the villain. You know, we, we do have a part of our business where we, you know, kids are on the iPad. Um, I think that's, I think if you would have asked me 10 years ago, I would have been actually more nervous about the toy industry, but I think more and more today, parents and kids love to do things offline and they love the physical factor of things. And I think there's nothing that beats, uh, a toy for your imagination, right? And sparking your imagination and play. And, uh, I don't think it's ever going to go away. I just really don't. We actually just acquired, uh, Melissa and Doug. I don't know if you guys grew up with Melissa and Doug. [00:55:20] Speaker 1: For 900 million? [00:55:22] Speaker 2: It was a lot of money. It was a lot, it was a lot of money. It was, it was, it was a lot of money, but, but just, I love your brother. He loves talking about money. It's incredible. And, and, and, uh, but it's like, it's all about open-ended play. It's about wooden toys, right? And sparking your imagination. And I do believe that it's the healthiest thing for children is the offline play. And I do believe that parents are really connected to that. And I think the more we become, um, you know, screen obsessed as a humanity, um, I think that people are going to connect to that. They're going to crave the, the physicalness of the physicalness and the wonder. I mean, you can't beat flying an airplane, you know, like it's so, it's so wonderful. And so I, I'm, I'm very confident about the toy industry, how it's going to play out when it comes to entertainment. It's going to be very interesting to see with AI and how that's going to affect everything. Um, and I think that healthy screen time, the one thing I'll say about screens, as long as it's healthy screen time, right? And so that's what we do with, with Tokuboka and with, uh, Sago Mini and Picnic. We, we're constantly trying to give healthy, engaging learning experiences for kids on the screens rather than just, you know, whatever comes up, uh, you know, when you're scrolling YouTube. [00:56:40] Speaker 1: 100%. Yep. [00:56:41] Speaker 2: We like to end these podcasts off with two quick questions for our guests. [00:56:44] Speaker 4: I got to ask this last one. Okay. This one's been burning for me. Okay. I wanted to ask it earlier, but like, I just generally want to know what happens when a toy dies, you know, when, when, when, when a chain of toys die, like the concept dies, what, what actually happens to those toys? Is it, you mark it down and try to just get rid of it? Like, what does that actually look like? Um, because I'm sure you probably, in some of these ventures, you probably had thousands of units left over. So what, what kind of happens there? [00:57:12] Speaker 2: Oh yeah. You can call me. Uh, yeah, you, you hit on it. You start, you basically, the crazy thing about toy industry is you can, you, you can know whether or not a product is going to do well within the four, the first four to six weeks. Okay. So you start looking at the point of sale and you can extrapolate out because there's a multiplier on every week of sale, every week in the year. And if you are not getting the sell through that you're looking for, you have to just start to market down the product really quickly, right? 29, 99, 14, 99, 9, 99, 4, 99. And you just keep on going to what moves out. And then there's other channels of distribution where you can sell it at much lower prices and those goes into different retailers and you, you basically move the goods. [00:58:06] Speaker 4: Is that pretty much like going to like the five below the dollar stores? Like you just try to start moving into those to just get rid of it. Correct. Correct. And other channels. [00:58:14] Speaker 1: But I would feel like, was there ever a time where something beat the odds of that like four to six weeks? For example, like if something would have like caught steam from like a show, for example, or from like a different campaign? Or was that generally pretty true? [00:58:27] Speaker 2: It's really, it's really rare. Okay. It's really rare. 99% of the time. I can tell you this much. We only one time, and we've launched thousands of products. Only one time in Spin Master history have we ever brought back a product that's done well. Which one was that? It was called Twisty Pets. [00:58:45] Speaker 1: Yeah. Well, I'm going to start us off, and Jack will finish off here. So, again, Ronan, you're 55 years old today. Ronan. Ronan. Ronan. There we go. I mean, eventually, you don't get it right, right? It's okay. It's such a difficult name. It shouldn't be, though. It's your name, man. So, but 55 years old today, if all of us, you know, if me and you were to die tomorrow and you could leave one last message here with the younger generation, what would that be? [00:59:10] Speaker 2: Really enjoy the journey. Be in the moment, be in the present, realize what's happening to you, and don't sweat the small stuff, and keep the ego in check. [00:59:19] Speaker 3: I love it. And Ronan, for you, with the legacy that you've built, how do you want to be remembered? [00:59:27] Speaker 2: You know, as a person that made a little bit of history, and, you know, made kids happy. Made kids smile. [00:59:39] Speaker 1: That's great. Well, this was an amazing episode, and it was fun to learn about the toy business from start to finish with you, my friend. So, thank you so much for being here with us today, man. We really appreciate that. And for everybody that's watching right now, be sure to like and subscribe for amazing content every week with amazing guests, amazing business owners from all over the world. This was an incredible episode. So, make sure that you like and subscribe to the School of Hard Knocks podcast. We're going to put the link down in the description to all of the social handles for you to follow along with Ronan, as well as his book that he's got that's come out. And so, you got to get a copy. So, that way, they can figure out the blueprint on how to launch that business in today's world. But lastly, guys, we're going to put the link down in the description to join the School of Mentors, which is the number one entrepreneur community in the entire world, where every week we host live calls with the entrepreneurs that we interview here on the Hard Knocks podcast. So we can't wait to see you on the inside. With that being said, we'll see you in the next episode.