Sprig no longer toying with success

FORT COLLINS – For the founders of Sprig Toys, the company’s recent acquisition by industry giant Wham-O means not only the chance to continue innovating their product line, but also the opportunity to participate in the reinvigoration of one of America’s most iconic brands.

Sprig announced in early February that it would be acquired by Emeryville, Calif.-based Wham-O Inc. The timed-stock purchase deal will result in the formation of Wham-O Jr., a division headed by Sprig’s founders, Chris Clemmer, Justin Discoe and David Bowen. The Sprig brand of eco-friendly, kid-powered toys will continue and the Sprig team will assist in development of Wham-O-branded toys.

It’s been a flurry of activity for Sprig. The acquisition announcement was made just a week before Sprig was off to the International Toy Fair in New York City, where it anchored the eco-section. Sprig then found out that its Captain Owen’s Dolphin Explorer Boat had won the fair’s Specialty Toy of the Year award.

Part of the transition and integration with Wham-O will include Sprig’s graduation from the Rocky Mountain Innovation Initiative incubator program. It is the first company to enter and successfully complete the program under the RMI2 flag.

“They’re a little atypical,´ said RMI2 Executive Director Mark Forsyth, explaining that success of this magnitude doesn’t usually come so quickly. “We’ll try to continue to help them as they transition.”

Looking for space

Sprig is already on the lookout for what Discoe calls an “Ally McBeal” space – referring to the late-90s television series set in a quirky law office over a bar. The designers are looking for a creative office space in downtown Fort Collins, from which they plan to grow the design team.

Forsyth feels the acquisition will be good for the community, in general, and local startup community in particular. Sprig was able to grow with support from local angel investors.

“They’re going to get a good return on investment,” Forsyth said.

For such success to come at a time when few investments are panning out could lead angel investors to put funds into other startups and inspire others who have been watching from the sidelines to step up. That was a concern for Sprig’s founders.

“For us, it was really important to have that kind of success,” Clemmer said.

Discoe explained that the team feels like it now has the opportunity to give back to the community that helped it to succeed, specifically the city of Fort Collins and RMI2. The last thing they wanted to do was create a negative experience for the area’s still-developing angel investment community.

“Largely, their success is a credit to the innovation of the design team,” Forsyth said. “It’s one of the most enthusiastic creative teams I’ve ever worked with.”

That enthusiasm helped Sprig quickly make a name for itself in the industry. In addition to the attentions of Wham-O, the company received several inquiries from other toy firms, ranging from casual talks to more formal acquisition discussions. Still, the Wham-O deal was a bit of a surprise.

“We were really still just running Sprig with our heads down,” Clemmer said.

The acquisition will likely lead to Sprig toys appearing on shelves of larger retailers. Sprig grew its sales network and reputation with smaller, independent toy stores, which will still be a focus for the brand. After all, if it’s not broken there is no reason to fix it.

“Sprig has done a tremendous job getting their name out there in a short amount of time,´ said Dennis Claussen, vice president of creative development for Wham-O.

Claussen explained that Sprig has its own unique message that makes it stand out in the crowded and competitive toy industry.

“It’s something that spoke to all of us here at Wham-O,” he said.

Icon in transition, too

Wham-O has been going through its own transition. In many ways, the 62-year-old company is like a startup.

The company was founded in 1948 and by the 1960s had introduced the world to the Frisbee, Slip ‘N Slide, Hula Hoop and Superball. In 1982, the company went through the first in a series of ownership changes.

Claussen said that the near-constant transition phases may have resulted in a divergence from Wham-O’s legacy as an innovative producer of outdoor toys. The most recent change – an October acquisition by an investor group – brought the company back to that focus. The investor group includes Kyle Aguilar, who now serves as CEO and for years has headed Manufacturing Marvel Inc. Marvel has been the manufacturer for both Wham-O and Sprig. Sprig is the first acquisition since the new owners took the helm.

The focus now is to build on the company’s decades-old reputation and put the Wham-O brand back into all homes. The company will put a lot of concentration into the branding message as well as into pioneering new products.

“Sprig is definitely the springboard catalyst for that,” Claussen said.

Wham-O just shipped a new Frisbee made of Sprigwood – the EcoDisk – and Claussen said the plan is to incorporate Sprigwood into more Wham-O toys. For the Sprig founders, working with the iconic brand is an exciting prospect.

“They’re essentially reinventing themselves,” Bowen said.

The acquisition will be phased in over about three years, depending on how long it takes for the Sprig brand to hit certain milestones. The founders will be able to once again put most of their focus into toy design as they transition some of the general business functions to Wham-O, but will continue to meet with buyers, where they garner market information that drives their next products.

“We enjoy it now, too,” Discoe said. “It’s fun.”

Sprig will also benefit from manufacturing costs about 30 percent lower than before and an instant connection in global markets. Bowen said that without the acquisition, it would have been very difficult for the small company to broadcast the Sprig story around the world.

“It enables us and empowers us to expand,” he said.

What Sprig is taking away from the experience of being a startup is invaluable life and business lessons. The team plans to be involved with the incubator community still, and they don’t discount that they could someday be involved in starting a business, again.

“It’s all been fun, and it’s also been the most stressful time in our lives,” Discoe said.

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