Genius Brands International has been on a multi-year mission to provide quality children's entertainment with the intent to "provide content with a purpose!" I have owned the $GNUS stock and followed the story for over five years. It has not been a smooth ride.
However, I have watched what started as this tiny company with big ambitious goals of becoming a premier children's content provider in the face of what many would think were impossible odds and hurdles to overcome. At times I questioned whether or not the company was going to survive. Andy Heyward has devoted his life's work to the cartoon and animation industry. "Andy started his career in the industry working as an assistant for legendary animator Joe Barbera of the very successful Hanna-Barbera. Andy led DIC Enterprises, which was made possible because Andy and other investors performed a buyout of the majority of shares in DIC Enterprises. Under Andy's leadership, the company became DIC Entertainment and eventually sold to Disney."
Source (paraphrased from Wikipedia) Andy Heyward - Wikipedia
I would characterize Andy as an extreme optimist with a flair for the ability to sell the sizzle. However, to be as straightforward as I can be. That sizzle often failed to turn into steak. I do not think it was due to a lack of effort. I also do not believe that Andy had any ill intentions to mislead anyone.
Sometimes things don't work out as one might have envisioned. The media and entertainment business is a tough one. There are many risks when you are creating something from an idea and bringing it to life. Genius lacked cash flow, and they were creating content from scratch. They had to rely on being able to sell an idea to a studio or content provider with scale to distribute their creations and hope that they would be a success. The production and licensing of the content do not provide a windfall of fortunes. The fortunes only come if you have a big hit with the opportunity to sell branded merchandise and collect the royalties on the merchandise. As you will learn in the interview, even that model has changed in recent years.
Genius had some stumbles, and at times, it seemed as though there was a large amount of overpromising and under-delivery. As any investor knows, it can be the death knell of a company because they lose credibility in the investment community. Genius struggled to survive the share price dropped to single-digit penny land regardless of the reasons. Like a Pheonix rising from the ashes, Andy pulled a rabbit out of a hat and raised an incredible amount of capital that enabled Genius to extinguish their toxic debt and clean up the cap structure.
The balance sheet has never looked stronger. The cost of that financing for Genius Brands has ballooned the outstanding share count to nearly half of a billion shares. That is a significant share count for a company with almost non-existent revenues.
Over the last two years, Andy and his team have made some great moves with smart and accretive acquisitions. Genius has developed its own network platform for distribution and created a hit show with "Superhero Kindergarten," starring Arnold Schwarzenegger in the lead role. Andy has put together a fantastic team of executive talent with a proven track record of success. Icons in the industry have positioned Genius on the cutting edge of entertainment with what I believe will generate not just one major hit but many major entertainment triumphs for years to come.
Jon Ollwerther had joined Genius when things were not the best at Genius. Jon and I had many conversations over the years, and many of them were not exactly "warm conversations." There was a lot of frustration being a shareholder. Jon never dodged my calls and would call at night or on weekends. Jon's level of commitment and professional demeanor is impressive. Jon weathered the storm through the hard times and see's the light at the end of the tunnel. Jon's dedication and work ethic has been rightfully recognized and rewarded by Andy. Jon received a promotion to the President of the "Kartoon Network" and is also responsible for their latest announcement, the "Kidaverse."
"***Genius Brands will be launching its subscription-based Kartoon Channel! Kidaverse on April 15, 2022, anchored by Ameba TV’s technology platform, a growing children’s video streaming service recently acquired by Genius Brands.
Kartoon Channel! Kidaverse will include Kartoon Channel!’s programming while adding exclusive metaversal content; the platform will feature an integrated design with custom avatars and emojis, games, branded Kidaverse VR goggles, immersive content and NFTs for kids (“KFT”s). It will also feature collectable digital cards based on the channel’s popular characters, digital currency for kids called Kidaverse MetaBuck$, and child-safe messaging (“Messies”), podcasts, and music*."**
Source Animation World Network
Recognition/appreciation and rewarding your top talent is another sign of Andy's outstanding leadership. There are so many good things happening that I can not get through them all in this nearly two-hour-long interview. I think what you will learn from watching this interview with Jon is the quality and passion of the people that Andy has put together to make "Genius Brands International" $GNUS another "Hidden Gem!"
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