Working in Washington's high-tech hub in 1998, all Mike Becker heard about was high-tech this and future that. So Becker took a look at what his fellow Redmonites were doing--and did exactly the opposite. Inspired by an article in Entrepreneur magazine and having long collected nostalgia-based toys and items from his childhood, Becker surmised "There's got to be people like me out there [who love nostalgia], where I could have a cool little business based on that love." Choosing to resurrect the bobblehead, Becker pulled out his life savings of $35,000 and took a business trip down memory lane.
Becker makes his "Wacky Wobblers" out of plastic rather than the fragile papier-mâché of the classic versions. Focusing on characters and personalities he enjoyed from the past, Becker chose Bob's Big Boy as his first licensing conquest. He convinced the distributor who sold to the gift shops in Bob's Big Boy restaurants it would be a hit, and after a couple thousand sold, he landed a big order for 13,000. Becker then applied his profits toward new licenses, characters and molds.
Becker's second licensing deal came with the help of a business acquaintance who is the licensing director at New Line Cinema. His break took advantage of the afterglow following the first Austin Powers movie, which resulted in shagadelic sales of 80,000 bobbleheads.
Becker's growing line of Wacky Wobblers (recent additions include Bozo the Clown, Lucky Charms and Pink Panther) helped Snohomish, Washington-based Funko Inc. reach $2 million last year without selling to large discount merchants. Opting instead for the small, cool, independent gift and specialty shops, Becker is content with Funko's volume, but has plans to diversify with other products, keeping with the nostalgic vibe he's created. And although he's now the one being approached by companies for licensing about half the time, the self-titled "chairman of fun" hasn't swayed on lucrative deals that didn't fit with his ideology, such as the promotional sports figures his competitors have jumped on. He continues to be the sole decision-maker judging which characters are Funko-worthy and vows to keep his small, eight-employee family-and-friend operation anti-corporate. "My dog's here every day, and we wear shorts and play video games like we wanted to in the beginning," Becker shares. "As long as I'm doing what I want to do and we're making a profit, I can't imagine anything better."
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Why did you choose bobbleheads?
Mike Becker: The product is really secondary to what the company's about, and that's the feeling. That's what we're selling. Everybody thinks back on when they were a kid, when times were great, when there were no worries in the world--or at least that's the way you perceived it. I just had to figure out a product that would fit into that feeling. Bobbleheads were low tech. I figured a guy that had no toy background or experience could get involved. Obviously all this stuff ended up being a lot harder than I ever dreamed it would be.
So you had to learn as you were going along?
Becker: It was kind of by trial and error. [After my first order,] I still didn't understand what the heck I was doing. I didn't have any distribution networks, sales reps, employees, or even a place of business; it was out of my house. The hardest part was dealing with a lot of stuff I hate: the paperwork, details. I kind of like creating of the item and not the accounting. I had to become competent in all those things. My wife, Claudia, took over a lot of those things just by default. My brother quit [working for] Nintendo and joined me in the garage. One by one I started grabbing different family members and friends.
How long does it take you to get licenses for the characters?
Becker: It always works differently. Some of them take years--like the General Mills characters Count Chocula and Frankenberry took two years--and others, one five-minute phone call. Bigger guys like Warner Bros. and New Line Cinema have departments dedicated just to licensing, and luckily I have a licensing background from my former job.
How do you work out the licensing fee?
Becker: It's pretty standard. There's an advance toward future royalties, once the product is made and sold. Then there's a guarantee amount. We negotiate a fee, but I try to set a standard fee for all of them. I know some characters are going to sell more than others, but I want them to feel like and realize that what we're doing is a really good thing for them.
Some of your competitors seem to have gone towards the promotional aspect of bobbleheads. Why haven't you?
Becker: I kind of think we're lucky enough to do what we want to do, so it's kind of "dance with the one that brung you." We don't want to be flavor of the month; we want to do this for a long time.
How do you choose which characters you use?
Becker: It just depends on what I want. We're coming out with Wallygator, Secret Squirrel, some old Hanna-Barbara ones. We're doing Michelin Man, Sprout, Green Giant, Tony the Tiger and Josie and the Pussycats. I really admired Shag's art style, so we just signed a deal doing some Shag bobbing heads.
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This article was originally published in the November 2002 print edition of Entrepreneur with the headline: Got ID?.
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