“Real Companies, Real Cases in Real Time”
Transcription
“Real Companies, Real Cases in Real Time”
“Real Companies, Real Cases in Real Time” Real Time Cases ® – ThinkFun The Real Time Cases Philosophy: The goal of Real Time Cases is to change the landscape of higher education for professors and students through experiential learning. We believe that contemporary education neglects to adequately prepare students for the professional work environment. Education should reward creativity while being fun, relevant, practical, interactive, and up-to-date. Real Time Cases fosters these values by equipping students with the tools they need to approach and resolve issues for real and established companies. Real Time Cases allows students to gain experience through helping real companies assess opportunities and resolve issues in the marketplace. For the first time ever, students and professors have exclusive access to information directly from the CEOs of startup, high-growth, and mature companies from around the globe. Bridging the gap between the intellectual classroom and the dynamic professional work environment, Real Time Cases allows students to incorporate their own personal experiences, critical thinking skills, unique creative potential, and research capabilities into assignments from top-level management. It is important for professors and students to know that this is not a typical case study. Real Time Cases’ content is derived from a multitude of readily available sources as well as privately distributed information. This information is optimized to best meet the needs of students and professors. Our materials are designed to introduce executive management teams and their businesses, providing a knowledge base for students to engage in independent research, allowing them to formulate valuable solutions and suggestions. Students will not be able to answer questions or make suggestions about the case study prompts without doing outside research. This is done intentionally to best simulate expectations in the working world. Real Time Cases looks to enable professors to reward creativity, innovation, and forward thinking. Through the integration of multimedia, technology, communication, and teaching tools, Real Time Cases is delivering the easiest way for professors to elevate their teaching and create a classroom environment that students want to contribute in. With the materials provided by Real Time Cases, students and faculty now have access to the most interactive and realistic simulation of the professional world. Real Time Cases works to improve education for students and professors by using real information from the CEOs of real companies. In order to best prepare students for the real world, CEOs provide proprietary, confidential, or otherwise privileged information. Please be especially considerate and do not copy, share, or distribute the contents of this packet. This content is to be distributed for educational purposes through approved parties only. Real Time Cases reserves the right to terminate their relationship or take other legal measures in the event that any parties deviate from the Terms of Use signed when registering for our site. We appreciate your understanding. Proprietary & Confidential 1 Real Time Cases ® – ThinkFun Company Profile: Company Name: Location: Founded: Website: Holding Type: Company Size: Estimated Valuation: Industry: ThinkFun Alexandria, VA 1985 http://www.ThinkFun.com Privately Held 30-35 Employees N/A Toys Executive Team: Bill Ritchie CEO, Co-Founder Proprietary & Confidential Andrea Barthello COO, Co-Founder 2 Real Time Cases ® – ThinkFun Table of Contents: About ThinkFun ………………………………………………………………….......... 4 ThinkFun’s Mission ……………………………………………………………………. 4 ThinkFun Company History ………………………………………………….……….. 5 – 9 Exhibit 1: Mr. Keister, Bill & Andrea with Hexadecimal Puzzle ……………… 5 Exhibit 2: Original Horse & Cat Puzzle ………………………………………… 5 Exhibit 3: Original Hexadecimal Puzzle ………………………………………... 5 Exhibit 4: SpinOut, TopSpin and BackSpin Puzzles ..………………………... 6 Exhibit 5: Yoshigahara’s Tokyo Parking & ThinkFun’s Rush Hour …………. 7 Exhibit 6: Original Zingo Packaging and The New Zingo Packaging ………. 8 Exhibit 7: Gordian’s Knot ………………………………………………………… 9 Exhibit 8: Rush Hour on the iPad ………………………………………………. 9 The ThinkFun Process & Supply Chain …………………………………………….. 10 – 11 Exhibit 9: ThinkFun Global Availability by Country ……………………………… 10 ThinkFun’s App Strategy …………..…………………………………………………. 11 Exhibit 10: Solitaire Chess, Chocolate Fix & Rush Hour Screenshots ……….. 11 The ThinkFun Team ……………………..……………………………………………. 12 Exhibit 11: ThinkFun’s Alexandria, VA & Hanover, PA Office Teams ………… 12 About CEO & Co-Founder Bill Ritchie ………………………………………..……... 12 – 13 About COO & Co-Founder Andrea Barthello ……………………………………….. 13 – 14 Exhibit 12: ThinkFun Toy Portfolio ……………………...…………………………... 15 – 17 Exhibit 13: Toy Industry Analysis ………………………………….………………... 17 – 21 Exhibit 14: Article – The 75-Year Saga… ……………….…………………………. 22 – 24 Proprietary & Confidential 3 Real Time Cases ® – ThinkFun About ThinkFun: Founders Bill Ritchie and Andrea Barthello started ThinkFun back in 1985 (operating under the name Binary Arts at the time) with scarce resources and almost no experience in the toy industry. Despite their circumstance, Andrea and Bill believed that there was a market for toys and puzzles that goes far beyond entertainment. ThinkFun’s products help children (and even adults) think critically while having fun. Their toys integrate proven mechanisms to improve focus and attention, fine motor skills, memory, concepts of numbers and letters, social interaction, speech and language as well as visual perception. Andrea and Bill were some of the founders of the niche market that blurs the lines between education and entertainment. The constant pursuit of fun and educational toys with these properties is what distinguishes ThinkFun from their competitors. ThinkFun is a respected global company that has distribution in over 60 countries with products translated into over 20 languages. ThinkFun maintains a continual process of product development and innovation. They consistently look to introduce new games, acquire similar brands and products, and improve on products they currently have on the market. ThinkFun has developed hundreds of toys in the last several decades, many of which are still around today. They are currently manufacturing and distributing over 45 different products and they are constantly looking to expand their product line and enter new markets. ThinkFun began in a time where games required physical pieces, boards, instructions, and friends around to play with. With every new generation and the advent of new technology, the toy industry incurs major changes, which makes it one of the most dynamic markets. ThinkFun’s products may not be on the forefront of innovation, but they know their products can easily be adapted into contemporary technology. For that reason, ThinkFun has developed tech apps that closely resemble their most popular games and they anticipate that they will continue to develop their mobile and web presence well into the future. ThinkFun’s Mission: “Our mission is to ignite your mind! For people of all ages who want to challenge their mind and sharpen their skills, ThinkFun is the world’s leader in addictively fun games that build reasoning and creative thinking skills through play.” Proprietary & Confidential 4 Real Time Cases ® – ThinkFun ThinkFun Company History: The ThinkFun story begins on February 4th, 1985 when, in separate meetings, Andrea resigned and Bill was fired from a Washington, DC area real estate company… “and they left not a moment too soon!” Shortly thereafter, the real estate company's CEO was indicted for insurance fraud and fled the country. Bill and Andrea decided to roll up their sleeves and follow their dream of building an innovative toy company. However, 1985 was not a favorable time to enter the toy business. Toys“R”Us was rising to market dominance, independent toy and games stores were going out of business and the big department stores were straying away from selling board games and puzzles at Christmas, which had been a tradition for them. The Rubik's Cube fad of the early 1980's had left storeowners with a huge overstock of Cubes, which left puzzles and critical thinking games not entirely sought after by toy stores. ThinkFun’s original company mission was "to translate the brilliant ideas of the craziest mathematicians, engineers and inventors into simple toys that can be appreciated by boys and girls around the world," which they still believe today. ThinkFun’s first products were three mechanical puzzles, The Hexadecimal Puzzle, the Cat, and the Horse, all invented by Bill’s father's best friend and Bell Labs engineer William Keister (Shown in Exhibits 1, 2 & 3). As wonderful as they were, Bill and Andrea felt that these toys were “over-priced and a bit amateurish.” By the late 1980s, ThinkFun had introduced three popular plastic brainteaser puzzles to the market: SpinOut (now a Games Proprietary & Confidential Exhibit 1: Mr. Keister, Bill & Andrea with Hexadecimal Puzzle Source: ThinkFun Website Exhibit 2: Original Horse & Cat Puzzle Source: ThinkFun Website Exhibit 3: Original Hexadecimal Puzzle Source: ThinkFun Website 5 Real Time Cases ® – ThinkFun Magazine Hall of Fame classic), TopSpin and BackSpin, which are shown in Exhibit 4. Around 1990, two things happened that catapulted ThinkFun forward. First, the recession of 1989 “threw loads of yuppies (young urban professionals) out of work”. They stopped shopping at Sharper Image and Nature Company and looked for less expensive grownup toys and gadgets. Also at that time, "Edge City" suburban shopping malls were just hitting the American landscape in a big way, bringing with them a new generation of adult lifestyle stores that were hungry for fresh products (i.e. The Museum Company, Natural Wonders, Brookstone, Hudson Trail Outfitters and InGear). Exhibit 4: SpinOut, TopSpin and BackSpin Puzzles Source: ThinkFun Website When they realized there were many opportunities available to them, ThinkFun went through a creative period when they partnered with many puzzle inventors and developed a wide range of puzzles. They believe that their puzzles should be created with an eye towards cleverness and built with integrity. The 1990s were full of surprises for ThinkFun. Bill says, “A moment that stands out most for us was when Izzi Daddaboy, the senior toy buyer for Harrods of London, walked into our booth at Toy Fair to tell us, ‘We need to do business together,’ then placed a huge order. In contrast, one of the scariest times was in the fall of 1990 when, during the run-up to the first Gulf War, the US military almost commandeered the factory making our puzzles. We got one machine allocated to us, running 24 hours a day to keep up with really big orders flooding in from these new stores. We made the Inc. 500 four years in a row in the early 1990s… it was a whirlwind, but a fun time!” “A seminal moment came in 1995, when Nob Yoshigahara showed us his Tokyo Parking puzzle” (Exhibit 5.1). In the summer of 1996, ThinkFun brought this puzzle to market as Rush Hour, now an iconic best seller (Exhibit 5.2)! The timing was perfect. The retail market was shifting, and the upscale grownup lifestyle stores were being supplanted by a new generation of upscale children's toy stores. In the heady atmosphere of the late 1990's, chains such as LearningSmith, Zany Brainy, Store of Knowledge, Noodle Kadoodle, as well as online toy store eToys took off and grew like weeds. This period from 1995 to 2000 was the most creative and vibrant in the history of American retail shopping. Rush Hour soon became ThinkFun’s flagship toy. Proprietary & Confidential 6 Real Time Cases ® – ThinkFun Exhibit 5.1 & 5.2: Yoshigahara’s Tokyo Parking & ThinkFun’s Rush Hour Source: ThinkFun Website Exhibit 5.1 Exhibit 5.2 In short order, ThinkFun brought to market Stormy Seas, Hoppers, Railroad Rush Hour, River Crossing, Lunar Lockout, Safari Rush Hour, and many other multi-challenge brainteaser logic puzzles. ThinkFun also experimented with science toys, optical illusions, simple “Aha!”-style brainteasers, and started working locally in schools to learn how their games could be used to teach learning skills. Retail customers were hungry for anything that was creative and different, and they had a license to showcase different ideas and introduce a lot of creative inventors to the market. Well aware that their "Select a Challenge, Beginner to Expert" formula was perfect for online play, ThinkFun decided to strongly pursue possibilities with the Internet during the mid-1990s. ThinkFun believes one of their best accomplishments was when they got selected "Small Business of the Year" by Microsoft in 1997. Bill says, “The late 1990s were a crazy time in the online world, with everyone going nutty in the dot-com craze. We couldn't quite buy into the required business formula for the time, which was to raise a huge amount of investor money by promising to run the business at huge losses currently and the promise of enormous revenues later… so we lost our techies to the competition and went back to what we did best… working with the wackiest inventors and translating their ideas into wonderful puzzles for boys and girls around the world. “ The dot-com bubble burst in the spring of 2000, and loads of technology companies promptly went bankrupt. Right beside them were fancy retailers who had entered the market during the 1990s (i.e. LearningSmith, The Museum Company, Natural Wonders, World of Science, Zany Brainy, Store of Knowledge, Noodle Kadoodle, FAO Schwarz, and eToys). ThinkFun believes that this, combined with No Child Left Behind legislation and 9/11, made the early 2000s a Proprietary & Confidential 7 Real Time Cases ® – ThinkFun tough period for creative games and puzzles. Needless to say, ThinkFun made it through the rough patch by continuing to be innovative and creative with their toy development and improvement. ThinkFun turned their focus to making games for preschoolers and early learners. It was not as easy as they anticipated. Silly Stories, Picture Link and the Same Game were all retired within two years of their launch. Thankfully, they came up with one of their most prominent toys at the time, Zingo!, which helped ThinkFun make up for their less successful games. Zingo! did not sell well at the start, but there were a few toy stores that had a constant demand from customers, so ThinkFun knew something in the process was not quite right. When they realized that the overwhelming negative response was to the packaging not the game, they quickly redesigned the package and launched the product, which was a huge success (Seen in Exhibits 6.1 & 6.2). In many ways, Zingo! was as successful for ThinkFun as Rush Hour. It was essentially the game that established ThinkFun as a respected developer of games that build early learning skills. Zingo! is still available and it is currently ThinkFun’s second best seller domestically. Exhibit 6.1 & 6.2: Original Zingo Packaging and The New Zingo Packaging Source: ThinkFun Website Exhibit 6.1 Exhibit 6.2 In 2003, ThinkFun changed their name from Binary Arts to ThinkFun. This change was part of a rebranding effort for the entire company in an attempt to exceed the virtual ceiling they ran into. Those who loved the games knew of Binary Arts, but ThinkFun knew that the available audience was much larger than what they had been able to attain. ThinkFun knew for a long time that they needed to better develop their brand. They came to the conclusion that their games were fundamentally designed “to inspire players to exercise thinking skills through the magical fun of game play,” they decided that the name ThinkFun was a perfect way to showcase this thought. Proprietary & Confidential 8 Real Time Cases ® – ThinkFun In 2006, encouraged by several good puzzle friends, ThinkFun brought Gordian's Knot to market. Bill says, “This is an extremely difficult 3-D sliding piece puzzle, and most people thought we were crazy to even try it. Sales started slow but rose steadily, then we heard about people posting movies of themselves solving Gordian's Knot on YouTube and it's been upwards from there. In the past couple of years, the trend has swung back to hand held brainteasers again, and we've got great new challenges in this category!” Exhibit 7: Gordian’s Knot Source: ThinkFun Website Since their beginning, ThinkFun has distinguished itself as an industry leader in making games that support learning and strengthen critical thinking and problem solving through play. Today, ThinkFun has exciting partnerships underway with schools and non-profit organizations worldwide. Among those are programs in Uganda, Jamaica, and Singapore dedicated to exploring new ways to support and build thinking skills using our innovative games and programs. In 2009, ThinkFun launched Rush Hour for the iPhone, followed shortly thereafter with improved versions for the Android, iTouch, and iPad (Shown in Exhibit 8). With Rush Hour alone, ThinkFun reached over half a million downloads in 8 months. Bill says, “Fans are raving about our first foray into the world of mobile apps, and in response we've got several new games in the works! With our ThinkFun Live online gaming program, we offer an entirely new play experience that will challenge veteran gamers while also supporting young learners developing problem-solving skills through play.” Exhibit 8: Rush Hour on the iPad Source: ThinkFun Website Currently, ThinkFun’s education team has been working with university professors and cognitive psychologists to explore new ways to use ThinkFun’s various programs and games to strengthen children's critical thinking patterns and skills. They are particularly excited about their work with the Bunge Cognitive Control and Development Laboratory at UC Berkeley, where a preliminary study showed a correlation between students playing Rush Hour and Chocolate Fix and a rise in IQ scores. This team is eager to delve deeper into the impact of ThinkFun games on reasoning ability, and they are very excited to learn more about how puzzle games impact the brain. Proprietary & Confidential 9 Real Time Cases ® – ThinkFun When asked about the future of ThinkFun, Bill says, “The world is changing rapidly, and we are excited to take on the challenges and opportunities that lie ahead in the 21st Century. The world is going online, and we now find ourselves more connected to our audience than ever before – this is great! Young people are now growing up online, and while we'll never abandon what we do best (making brilliant physical puzzles and games and selling them through stores) we are committed to becoming a strong online presence as we grow to support tomorrow's leaders.” Additionally, Bill says, “We founded ThinkFun on a dream, that we could change the world by translating the brilliant ideas of the craziest mathematicians, engineers and inventors into simple toys that can be appreciated by boys and girls around the world. At 25 years old [as a company], we feel like we are living that dream. Stick with us and follow us as we move onto the Internet and beyond. These next few years will be an adventure!” The ThinkFun Process & Supply Chain: ThinkFun is best known for the unique nature of their toys, making them a strong competitor. Due to the fact that their toys are designed with educational implications in mind (i.e. critical thinking, focus and attention, fine motor, memory…etc.), their process typically takes longer than the process associated with designing toys at larger more general toy companies. ThinkFun works with prototypes to test their products with children, teachers and families. It can take up to 8 months to develop a product that meets their standards and is ready for manufacturing. ThinkFun includes a diverse and dynamic team of industrial designers, graphic designers, and outside inventors. International Council of Toy Industries (ICTI) has approved manufacturers to create all of ThinkFun’s products in China. They ship their products out of Hong Kong to distributors around the world as well as to their own warehouse in Hanover, Pennsylvania. This warehouse is responsible for shipping products in large volumes to retailers like Target and Amazon as well as small niche boutiques and individual customers on occasion by order. ThinkFun has their products available in over fifty countries, which are highlighted in Exhibit 9. Proprietary & Confidential Key: Available Not Available Exhibit 9: ThinkFun Global Availability by Country Source: Internal Documents, Created by AMCharts.com 10 Real Time Cases ® – ThinkFun The time between the point that ThinkFun places an order and they (or their distributors) receive the final products can be as long as 60 days, which really depends on several items (complexity of the production process, issues that arrive during high quality control testing and whether the toy has been produced by that manufacturer before). For that reason, ThinkFun has a small team of liaisons that are directly involved with the setup and review process with the manufacturers in China. Another critical item related to ThinkFun’s supply chain is the safety and precautionary measures they take to make sure their products are safe and appropriate for children. In August of 2008, the Consumer Product Safety Improvement Act (CPSIA) went into effect putting forth a number of changes to consumer product safety laws. These regulations require that toy manufacturers reduce the amounts of lead in children's products (currently at 90 ppm or lower). ThinkFun has always used certified independent testing labs to test products and ensure their safety. ThinkFun’s App Strategy: ThinkFun has taken advantage of the new trend toward mobile app games. Since the strategy behind the games exists, ThinkFun is focusing on best synthesizing their top games into application versions. They have prioritized their games on feasibility and popularity, which is how they have ultimately developed the applications they have available as of now (Rush Hour, Chocolate Fix and Solitaire Chess, which are shown in Exhibit 10). Their applications are available for iPhone and for Android devices. Moving forward, ThinkFun anticipates being a large player in this very crowded market since they are allocating resources toward their application development strategy. Exhibit 10: (Left to Right) Solitaire Chess, Chocolate Fix & Rush Hour Screenshots Proprietary & Confidential 11 Real Time Cases ® – ThinkFun The ThinkFun Team: ThinkFun understands that their products and their process requires innovation and they can only be as effective as the individuals that make up their team. There are many people that are involved in the development and execution process of each toy at the company. ThinkFun teams typically include industrial designers, graphic designers, outside inventors, consultants, quality control experts, and product specialists. It is especially important to the founders of ThinkFun that their employees are committed to their goals and strategies. Founder and COO of ThinkFun, Andrea Barthello, says, “The most successful ThinkFun team members are passionate about the products that are created, they are creative problem solvers, they believe that there is no job too small and they are team focused and honest no matter what.” Exhibit 11: ThinkFun’s Alexandria, VA (Left) & Hanover, PA Office Teams (Right) Source: ThinkFun Website Who is in the case study video? Good Question! ThinkFun’s CEO & Co-Founder – Bill Ritchie Bill Ritchie is President and Co-Founder of ThinkFun®, Inc. He is a lifelong puzzle enthusiast whose passion drives the development of ThinkFun's innovative products and education programs. As a child in the 1960s, Bill played with as many puzzles and science toys he could get his hands on. Thanks to his father, a researcher at Bell Labs, Bill was also privy to intriguing concepts that never made it onto store shelves. In 1985, Bill and his wife Andrea Barthello founded ThinkFun, originally called Binary Arts, with a noble mission: "To translate the brilliant ideas of mathematicians, engineers and inventors into simple toys that can be appreciated by boys and girls around the world." It is a mission that continues to drive the company today. Bill believes fiercely in the power of a great game to strengthen thinking skills and prepare kids for the challenges of the 21st century. Bill is a respected member of the international puzzle Proprietary & Confidential 12 Real Time Cases ® – ThinkFun community and travels worldwide to share his knowledge, connect with fellow enthusiasts, and discover the next great game. He is a member of the World Presidents Organization and the founding President of the World Entrepreneur Organization. He was the recipient of the "Sam Loyd Award for Lifetime Achievement in Mechanical Puzzles" from the Association of Game and Puzzle Collectors and a featured speaker at TEDx. Bill earned a degree in American Studies from Wesleyan University and a Masters in City Regional Planning from Harvard University. He and his wife Andrea live in Alexandria, Virginia, with a vintage car on their front lawn modeled after ThinkFun’s internationally acclaimed Rush Hour ThinkFun’s COO & Co-Founder – Andrea Barthello Andrea Barthello is chief operating officer and co-founder of ThinkFun®, Inc. Her reputation for creative problem solving, talent spotting and nurturing of young minds distinguish her as a leader in the toy industry and as a role model for entrepreneurs everywhere. Growing up in a large Air Force family, Andrea traversed the United States and Canada in frequent moves that taught her flexibility, the importance of family and a roll-up-your-sleeves work ethic. Early in her career, Andrea put herself through college while working full time, attended graduate school at night, and sharpened her business skills in industries ranging from healthcare, to hospitality, to finance. In 1985, Andrea’s career took a life-changing turn when she and her husband Bill Ritchie launched ThinkFun (then Binary Arts) as part of a dream to change the world through play. The budding company’s introduction of the handcrafted, wooden Hexidecimal Puzzle created a new category of games geared to challenge the mind, and Andrea’s entrepreneurial instincts were put to the test. She directed sales and shipping, marketing and PR, and accounting and administration while building strategic relationships and mapping a blueprint for growth. Today, with a staff of 30, shipping operations in Pennsylvania and bustling headquarters in Northern Virginia, Andrea continues to wear many hats at ThinkFun and oversees operations as the company expands to more than 50 countries and 5,500 retailers to serve millions of passionate fans worldwide. Her belief in the power of problem solving as a conduit for adventure, accomplishment and lifelong learning has fueled award-winning games for players from preschool to adulthood. Since its beginnings in a basement nearly 30 years ago, ThinkFun has generated international acclaim and a mountain of accolades for beloved games such as Rush Hour, Zingo!, Laser Maze and Robot Turtles. Previously a member of the board of directors of the American Specialty Toy Retailing Association, Andrea is enjoying her second term as a board member of the Toy Industry Association and was honored as one of the region’s most influential women by the Washington Business Journal. Andrea earned her Bachelor of Science degree from George Mason University and pursued graduate studies in Public Relations at American University. She is the proud mother of two grown sons Sam and Michael, and the “American mom” of William Kamkwamba, a remarkable young man from Malawi. Her family remains her most adored responsibility and a consistent source of new ideas and passions. Proprietary & Confidential 13 Real Time Cases ® – ThinkFun Exhibit 12: ThinkFun Toy Portfolio Source: ThinkFun Website Proprietary & Confidential 14 Real Time Cases ® – ThinkFun Proprietary & Confidential 15 Real Time Cases ® – ThinkFun Exhibit 13: Toy Industry Analysis Source: Toy Industry Association™, Inc. (TIA), ToyAssociation.org Toy Industry Association™, Inc. (TIA) prepares an annual industry analysis on various critical aspects of the toy industry. These elements include annual sales data, economic impact data, a summary of significant census demographic data as well as an industry trends analysis. The TIA is the not-for-profit trade association representing all businesses involved in creating and bringing toys and youth entertainment products to kids of all ages. TIA’s nearly 750 members account for roughly 90% of the annual U.S. domestic toy market of approximately $22B. TIA has a long history of leadership in toy safety, including responsibility for the development of the first comprehensive toy safety standard. TIA members and staff continue to work with government officials, consumer groups and industry leaders on ongoing programs to ensure safe play. TIA serves as the industry’s advocate on legislative and trade issues; enhances the image and growth of the industry by promoting toy products at its trade shows and events, in the media, and via other means; and fosters philanthropy to children via the Toy Industry Foundation and its Toy Bank. Included are several exhibits for the TIA’s 2014 Toy Industry Analysis. Much more information is available on their website at ToyAssociation.org Proprietary & Confidential 16 Real Time Cases ® – ThinkFun Exhibit 13.1: Annual Sales Data Exhibit 13.2: Economic Impact Data Proprietary & Confidential 17 Real Time Cases ® – ThinkFun FUN AND GAMES IS SERIOUS BUSINESS FOR THE U.S. TOY INDUSTRY • More than three (3) billion fun, safe and affordable toys are sold across the U.S. each year. • From toy inventors and designers to store clerks in every state, the toy industry supports an estimated 321,030 U.S. jobs. Of these, 35.2% (112,901 FTE) are employed by small businesses. • The average unit price of a toy is less than $8.00, and the industry generates roughly $22B annually in direct retail toy sales. • The toy industry’s annual total economic impact in the United States is $75.03B Proprietary & Confidential 18 Real Time Cases ® – ThinkFun Exhibit 13.3: Population Data Proprietary & Confidential 19 Real Time Cases ® – ThinkFun Exhibit 13.4: Key Trends 2014 Proprietary & Confidential 20 Real Time Cases ® – ThinkFun Exhibit 14: Article – The 75-Year Saga Behind a Game That Teaches Preschoolers to Code Source: Wired.com, Cade Metz 7/24/14 With a new board game called Robot Turtles, preschoolers can learn the basics of computer programming. Ariel Zambelich/WIRED Next month, if you walk into any Target store across the country, browsing one of the main hubs of mass American consumerism, you’ll find a board game that teaches the fundamentals of computer programming to preschoolers. It’s called Robot Turtles. To play, you spread toy turtles across a grid—among various boxes, brick walls, and ice castles—and then kids use playing cards to guide these wide-eyed amphibians through the various obstacles, in search of colored jewels in the middle of the board. It’s a bit like a programmer using software code to guide images and data across a computer screen. “The Game for Little Programmers!” reads the box that will turn up on Target shelves the first week in August. This wonderfully clever, light-hearted creation is already a sensation in the world of online crowdfunding. Former Google and Microsoft employee Dan Shapiro raised over $631,000 on Kickstarter to build the game last year, and by Christmas, he’d shipped copies to his over 13,700 backers. But now, Robot Turtles is being mass produced by a game company called ThinkFun, and its arrival at Target marks a new milestone for what’s known as the “code literacy movement,” an effort to bring programming skills to, well, just about everyone. The game is a metaphor for the long and steady evolution of computer programming from the most complex and specialized of endeavors to something that anyone can grasp. A New York outfit called Codeacademy is helping the everyman learn programming skills through free online courses. Drawing on this company’s services, the United Kingdom has made coding part of the core curriculum in primary and secondary schools. Projects like Scratch and Google Blockly are creating a whole new type of programming specifically for children. And a wave of children’s books are teaching coding concepts at an even younger age. But there’s something different about Robot Turtles reaching a major American retail outlet, aiming not just for the kids of Kickstarter-happy professional programmers, but for the kids of ordinary shoppers. In more ways than one, the new board game serves as a metaphor for the long and steady evolution of computer programming from the most complex and specialized of endeavors to something that practically anyone can grasp. It’s not just that Robot Turtles is a new incarnation of Logo, a turtle-centric programming language that aimed coding concepts at children as early as the 1960s. It’s that ThinkFun, the company behind the game’s push into Target and beyond, can trace its roots through the family of the most important coder in the history of programming—and all the way back to the dawn of the modern computing age. Proprietary & Confidential 21 Real Time Cases ® – ThinkFun ThinkFun was founded in 1985 by Bill Ritchie and his wife, Andrea Barthello. Ritchie grew up in the shadow of Bell Labs, the Murray Hill, New Jersey research operation that gave rise to so many fundamental computing technologies, from the digital transistor to the Unix operating system and the C programming language. His father was Alistair Ritchie, who worked on telephone switching technology at Bell Labs. His older brother was Dennis Ritchie, the late programmer who invented C and helped design Unix, technologies that still drive everything from Google to the iPhone. And his “Dutch uncle” was another Bell researcher named Bill Keister, a close friend of his father’s who spent decades building puzzle games with the wires, lightbulbs, and switches he found in the Bell stock room. These games eventually gave rise to ThinkFun. Way back in 1937, drawing on new concepts of Boolean algebra that would drive the digital circuits at the heart of the computer revolution, Keister mapped out an electronic tic-tac-toe machine—what Bill Ritchie calls “literally the first computer game in the history of the world”— and this inspired a whole family of logic puzzles based on the ide of digital information. Ritchie grew up playing these games—wood and wire contraptions with names like “SpinOut” and “The Hexadecimal Puzzle”—and after he met his wife at a rapidly failing real-estate-taxshelter-syndication company in the mid-80s, they decided to build their own company around Keister’s creations. “The idea was to draw on the work of all the brilliant recreational mathematicians and physicists and engineers and other crazy people out there, like the Bell Labs people I had known as a little kid, like my father’s friends, like the friends of my brother Dennis,” Ritchie remembers. Over the years, the company would develop and expand and commercialize similarly clever games from designers across the world, including everything from a mind- sharpening traffic game known as Rush Hour, created by a Japanese inventor named Nob Yoshigahara, to the mental gymnastics of Math Dice, designed by the Ritchies’ then 11-year-old son, Sam. After teaching himself to program while building a digital version of Rush Hour for the Apple iPhone, Sam would go on to serve as a key engineer at Twitter, helping to build a sweeping coding system called Summingbird. In other words, Robot Turtles fits quite nicely into a 75-year story arc. In the beginning, if you wanted a computer to do something new, you had to build new hardware, much like Bill Keister, who, in 1946, sent the plans for his tic-tac-toe game to a Long Island electronics shop for manufacturing. Then came machine code— software closely tied to computer hardware— that made things a bit easier. Then people like Dennis Ritchie built broad programming languages that let large numbers of programmers build software for a wide array of machines. And now, things like Robot Turtles seek to expand the programming class even further. Aimed at children ages 4 and older, the game lets them “code” the movements of the turtles, playing various cards in a particular order. They can play these cards individually, as you would type a single instruction into a computer command line, or they can lay down a series of cards all at once, as if compiling a complete program. They can also use “functions”— embodied by frogs—to repeat the same set of command again and again, and there are simple ways they can “debug” what they’ve done. “It’s just a really good metaphor for programming,” Ritchie says of the game. Proprietary & Confidential 22 Real Time Cases ® – ThinkFun No, it won’t turn your preschooler into a bone fide hacker overnight. But it lays the groundwork for future adventures in programming–adventures that can extend well beyond the business of computers. Ritchie and Shapiro aren’t on a mission to turn everyone on earth into professional coder, but they do believe that anyone can benefit from having programming skills-=-or at least understanding programming concepts. “This is about building what’s called the ‘executive function’—the ability to stay on task, set planning, understand what your objective is, and staying focused,” Ritchie says. “Coding is about organizing your thinking, visualizing from the beginning through to the end, working through all the details.” Mitchel Resnick, who leads the Scratch team at MIT, agrees. “It’s great for kids to get an understanding computation thinking, and a game like this is a great way for them to do that,” he says. “Children need a better understanding of how the world works, and in today’s world, they are surrounded by computational objects.” You could even look at Shapiro as living proof of this phenomenon. He learned to program from his father, a professor of computer science at the University of Portland. As a 7-year-old, he sat on his father’s knee—literally—while coding his own Choose-Your-Own-Adventure-type game in the Basic programming language that came with the Commodore 64 home computer in the ’80s, and then, when he was a senior in high school, his father taught him serious coding through the classic textbook, The C Programming Language, co-authored by C’s creator: Dennis Ritchie. But Shapiro didn’t become a programmer per se. He became an engineer and an entrepreneur, eventually selling a six-month-old startup to Google. But not everyone has a computer science professor for a father. And that’s why Shapiro kickstarted Robot Turtles. He originally designed it for his own young children, but then he realized the potential audience was much bigger. As it turns out, the audience was even larger than that, and with ThinkFun’s involvement, it could be larger still. What’s more, there’s a nice symmetry to the game’s progress—symmetry being something that’s so valued in the world of programming. When he designed the game, Shapiro gave names to the four “function frogs,” and one of them was named for Dennis Ritchie. He likes the arrangement with ThinkFun because his family “loves to shop at Target,” but also because he has found a kindred spirit. “I had heard from a lot of people while working on the game that this was something that would never fly, that it would never work on store shelves,” he says. “But then I talked to Bill.” Dennis Ritchie’s brother said something very different. “Whoever you were talking to wasn’t me,” he told Shapiro, “because this is exactly the sort of thing that we love.” Proprietary & Confidential 23