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- Canadian toy company Spin Master is launching a $100 million VC fund.
- Cofounder Anton Rabie told Insider that many VC firms aren’t set up to support creatives.
- Spin Master’s fund has backed two startups, including one founded by “Candy Crush Saga” alums.
Anton Rabie has never taken a dime of venture capital.
He cofounded and helped build Spin Master to a $3 billion toy and children’s entertainment company publicly listed on the Toronto Stock Exchange. Yet, Rabie told Insider, finding financial backers can be an awkward journey for other companies in his industry, which relies on free-ranging creativity.
That’s why Rabie and his company are launching a $100 million VC fund of their own, which he says is custom-built for creators in children’s toys, games, and entertainment.
“Sometimes other firms don’t create the right environment,” he told Insider. “We want to preserve your culture, to make sure that creatives have their space.”
That’s even more so the case now, given the move to digital entertainment, which is harder to back up with a line of credit, which his company used to grow in its earlier years.
The fund, called Spin Master Ventures, has already backed two companies.
One is Nørdlight Games, a Swedish mobile games developer whose team includes several of the artists and engineers behind the popular “Candy Crush Saga” game series. The other is Hoot Reading, a Canadian online education company whose tutors use stories to create personalized reading lessons for children.
Like other corporate venture funds, Spin Master Ventures is looking for companies whose businesses are complementary to its parent company. Spin Master is the home of the popular children’s series and toy brand Paw Patrol, and it recently bought the iconic Rubik’s Cube.
Rabie told Insider the ultimate goal is that the company will eventually acquire the businesses in its portfolio. The fund plans to invest on average “a few million dollars” in each company, he said, with the possibility of larger check sizes for its biggest bets.
The fund’s management is structured as a small-team effort, with a committee of three members representing toys, entertainment, and digital games, plus Rabie and fellow Spin Master cofounder Ronnen Harary. Rabie and Harary will make the final calls on which companies receive investment.
While the fund serves as a creative pipeline for Spin Master, Rabie told Insider it’s also a way for him to give back, since the journey to scale a children’s toys and entertainment company can be especially difficult. The path to success in the industry doesn’t necessarily hew to the time horizon investors typically expect for returns, he said.
“We’re not like an external fund,” he said. “We’re not saying you have to do something in a timeline.”
The initial $100 million commitment has room to grow as well, Rabie said.
“We’ve structured the fund to be incredibly flexible,” he added. “The board has said ‘we’re happy to grow this.'”
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