Squishmallows joined Warren Buffett’s business empire two years after Lady Gaga, Kim Kardashian and others helped make plush stuffed toys go viral on TikTok.
For Judd and Laura Zebersky, who own the toy company Jazwares, the success of Squishmallows is hardly what they imagined when they met 33 years ago at the University of Miami law school.
They married in 1993 and began a career as a lawyer, but Judd Zebersky soon realized that was not his destiny. Four years later, he founded Jazwares, where he is now chief executive officer.
“I’ve been really into pop culture since I was a kid,” Zebersky said in an interview this month’s annual shareholder weekend for Buffett’s Berkshire Hathaway Inc in Omaha, Nebraska.
“I love comic books and toys, and I’m also an artist — a person who isn’t very good,” he said. “I looked at my wife and said, ‘I want to make toys.’ She said, ‘Follow your dreams,’ and that’s what I did.”
Laura Zebersky, a litigation attorney, sold her practice in 2005 and joined him, becoming president of Jazwares.
Jazwares revenue hits $1 billion in 2021. About 40% comes from Squishmallows, as sales have surpassed 100 million and the rest comes from in-house and licensed brands including Fortnite, Pokemon and Star Wars.
Berkshire bought Jazwares’ parent, insurance holding company Alleghany Corp, for $11.5 billion last October. Since then, it has not discussed Jazwares’ business performance.
“Jazwares is a gem,” Buffett said in an emailed statement. “And, Judd and Laura are the ideal Berkshire managers.”
TREAT YOUR Nerves
Other businesses in Berkshire’s stables also make toys, including Oriental Trading’s rubber ducks that resemble Buffett and his longtime business partner, Charlie Munger.
But it was Buffett and Munger Squishmallows that were tipped to be hot items at a weekend shopping event in Berkshire, with shareholders raking in 10,000. Before long, they were winning more than $500 on eBay auctions.
Launched in 2017, Squishmallows became part of Jazwares when it acquired another toy maker, Kellytoy.
The Zeberskys thought squishy toys could be successful but were not marketed well to a wide audience.
4 . advertising
There are more than 2,000 Squishmallows available, each with a unique name, date of birth—or “Squashmallow date”—and a biography.
“This is a brand that needs a lot of love,” says Judd Zebersky. “It makes a big impression, and when you make a big impact in the toy industry, great things can happen.”
In 2014, seeking help with expansion, the Zeberskys sold shares of Jazwares to Alleghany, which took a majority share two years later. Terms of both transactions were not disclosed.
Laura Zebersky said: “Another company is flirting with us. “We don’t want to sell, but we know we can’t grow normally without an acquisition. When Alleghany wants to buy a minority stake, we all support it.”
Led by Joseph Brandon, who previously ran Berkshire’s reinsurance company General Re, Alleghany now has Buffett’s deep balance sheet backing it up.
“Joe says our life is going to be really good, we are working with the best and most respected company in the world,” said Judd Zebersky.
The Zeberskys now report to Greg Abel, the vice chairman of Berkshire who oversees the non-insurance businesses and Buffett’s designated successor as CEO.
“Greg is exactly what we learned about the Berkshire model,” says Laura Zebersky. “He let us run our business, he let us run it the way we thought was best.”
The Zeberskys said they met Buffett once, at a charity dinner in Florida in 2017 to encourage investment in Israeli bonds.
Jazwares considers Hasbro, Lego, Mattel, and Pokemon its main competitors.
Its products come mainly from China, as well as Vietnam and finally Cambodia and Indonesia – the US is overpriced.
Judd Zebersky said Jazwares is looking to expand into an “ancillary” business for toys, such as costumes.
Curiosity helps guide where Jazwares might go next in a rapidly changing world, he said.
“Whenever you think you’ve reached the top of the mountain and you’re not curious, that’s when your company will fall,” he said. (Reporting by Jonathan Stempel in Omaha, Nebraska; Editing by Megan Davies and Leslie Adler)
Postmedia is committed to maintaining a vibrant yet civil forum for discussion and encourages all readers to share their views on our articles. Comments can take up to an hour to moderate before appearing on the site. We ask that you keep your comments relevant and respectful. We’ve turned on email notifications—you’ll now receive an email if you receive a response to your comment, there’s an update to a comment thread you follow, or if a user you follow comments on. Our Visit Community guide for more information and details on how to adjust email settings.
Join the conversation