Originally created 08/31/99

Great American Toy Hunt wants you



Dan Lauer is big on toys. Not just any toys, but creative toys, offbeat toys, playthings that are so significant to a child that decades from now, when today's children look back, they will remember them.

Why should you care? Because Mr. Lauer isn't just playing around anymore; he means business. And guess whom he wants for his business partner: Could be you.

"What I really want to do is uncover that dentist in Baltimore who has that great idea for a toy," says the 38-year-old Mr. Lauer, who a year ago co-founded Haystack Toys Inc. with Jeff Loeb. The St. Louis toy company's mission is to ferret out unique and innovative toys born in the basements and garages of ordinary people who have extraordinary ideas. Like the next Mr. Potato Head, the next Hula-Hoop, the next Koosh Ball, the next Super Soaker.

"What's unprecedented about this is that it's the toy company coming to you," says Mr. Lauer, a banker turned toy inventor. "We're looking for someone who has kids and has made an invention his kids like. Most of the big hits in the toy world have come from the outside."

Mr. Lauer knows firsthand. Ten years ago, with zero experience in the toy industry, he hit the jackpot that amateur toymakers dream about. Recalling that, as a child, his sister filled balloons with water, marked baby faces on them and dressed them in diapers, he created Waterbabies. When filled with warm water, the pliable, lifelike dolls are almost like playing with a real baby.

Major toy manufacturers turned down his Waterbabies -- repeatedly. "They get 400 letters a week from guys like me," says Mr. Lauer, who raised his own capital to make and market his idea.

Once sales started going through the roof, he cut a deal with Playmates Toys, the company that made a mint on Teenage Mutant Ninja Turtle action figures. Subsequently, Waterbabies became one of the top-selling dolls of the decade.

Since creating Waterbabies, Mr. Lauer has gone to every major toy fair and visited all the New York showrooms of toy manufacturers annually. He has watched as America's toys have gradually been redefined by computer chips and licensing agreements tied to movie releases and TV shows.

"It was like, `Wait! Stop the madness!"' he says of the moment the idea of Haystack Toys struck him. "I have four kids who are all under the age of 5. As a parent, I have to ask, `Are we doing this right?"'

"We want to honor play," he adds, explaining that the company name comes from its toy-search philosophy of trying to find a needle in a haystack. "We are authentic-toy centered; we're not Hollywood."

The odds of finding a needle in a haystack? A long shot, but not impossible, advises Jeff Jones, vice president of marketing at Tiger Electronics. The maker of the industry's most recent mega-hit, Furby, Tiger's reputation for pushing the envelope has grown with offbeat releases such as this summer's Sound Bites Pop Radio, a lollipop that channels FM radio to the inner ear, and the upcoming Laser Tennis, a real-space electronic ping-pong game to be introduced at the U.S. Open later this month.

But, of the 250 to 300 new toys Tiger will turn out this year, Laser Tennis is one of the few that originated outside the company. "The people who actually invented it were professionals who walked into the building, put a unit that worked on the table, and we played it," says Mr. Jones.

Stories like that are the exception. "People have a perception, rightfully or wrongfully, that inventing toys is easy," says Mr. Jones. "When you think about it, it is just a toy. How hard can that be?"

The Tiger staff member whose full-time job is reviewing ideas of outside toy inventors sees 5,000 to 10,000 concepts a year, says Mr. Jones. Most of these are from toy inventors who understand the industry and the trends. Yet fewer than 1 percent get to market.

That's where Mr. Lauer says he fits into the formula. He has kicked off The Great American Toy Hunt, a nationwide search for toys that feature ingenuity for children ages 3-6. He is inviting both experienced and first-time inventors to submit entries to the contest by Sept. 15 via Haystack Toys' Web site, www.haystacktoys.com. Applicants who meet the criteria "and stimulate our hearts and minds," he says, will meet with Haystack's toy experts when they tour the country, stopping in seven cities, in October.

Haystack will offer up to 10 finalists contracts that will include a $5,000 advance, a 5 percent royalty and a commitment of $50,000 toward the development and marketing of the toy. "This is an evolution, not just a contest," says Mr. Lauer, promising to usher the winners through the toy industry maze, from concept to store shelves. "We're screening applications on quality and commitment. What we're not looking for is somebody saying, `Here's my sandbox toy, but I don't have any money or time, so take it and send me my royalty checks.' I'm willing to risk a lot, so I'm looking for partners."

Haystack has received 45 applications and is counting 300 to 400 hits a day at the Web site.

As for resistance to the idea, "What I usually get is, `Wait, you're starting a toy company without a toy?"' he says. "We're starting a toy company with a philosophy instead."