Berkshire assumed ownership of the parent of Squishmallows, Jazwares, through the purchase of Alleghany in the fourth quarter of 2022. Both Judd and Laura Zebersky, founders and presidents of Jazwares, now report to Greg Abel, who is Buffett's designated replacement. In 2020 alone, an impressive 100 million Squishmallow products were sold, costing anywhere between $5 and $30 each. This plush toy line has accounted for 40% of Jazwares' total income for the past two years.
Noted business magnate Warren Buffett has a playful side, investing in companies whose products he likes, such as Dairy Queen and See's Candies, as well as the recent plush toy hit, Squishmallows. At Berkshire Hathaway's annual meeting in Omaha, Nebraska, the shareholders snatched up 10,000 Squishmallow dolls, some of which were modeled after Warren Buffett and his business partner Charlie Munger. Jazwares, the developer of Squishmallows, became a part of Berkshire after its acquisition of Alleghany in the fourth quarter of 2022. The Zeberskys, founders and presidents of Jazwares, are now accountable to and are often communicating with Greg Abel, the Vice Chairman of Berkshire's non-insurance operations and Buffett's potential successor. The two lawyers-turned-entrepreneurs, who are from South Florida, have expressed their excitement about being part of the Berkshire family, noting the opportunity to explore the synergy that it provides. Recently, Buffett commended Abel for taking on most of the responsibility of overseeing Berkshire's sprawling enterprise, including energy, railroad and retail. Despite the indirect involvement of Buffett in Jazwares, he has proven his willingness to invest in businesses that might not result in a significant earnings or revenue boost for Berkshire. More often than not, Buffett admires the management of these businesses and expects them to stay profitable and expand.
Last year's sales of Squishmallow units were an astounding 100 million, with prices ranging from $5 to $30. Laura Zebersky attributes the growth of Squishmallows to the pandemic, as well as to endorsements from high profile celebrities. She adds that the plush toy appeals to both kids and adults, thanks to its affordability, accessibility, and comfort.
In 2020, toy company Jazwares purchased the creator of Squishmallow, Kellytoy. Over the past two years, Squishmallows have accounts for 40% of Jazwares' total revenue. To ensure its continued success, Jazwares is wary of oversaturation in partnerships and strives for sustained growth.
To capitalize on its booming popularity, Squishmallows recently announced a partnership with McDonald's Happy Meal which will roll out in 70 countries by 2023.
Last month, Jazwares took part in the annual VidCon in California: a convention for content creators and online brands. The company had a big pit full of Squishmallows for visitors to jump into. According to Zebersky, "We don’t follow conventional marketing tactics. Instead, we go to where our fans are. VidCon is the best example of that, as it is the biggest gathering of influencers." Squishmallows are one of Jazwares' IPs that is owned entirely by them, but they also have products from licensed partnerships with Disney, WWE, Pokemon and others.
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