Toon King Andy Heyward Has Grown DIC Into an Animation Powerhouse

Mar 10, 2003  •  Post A Comment

The red socks were a giveaway.
Standing tall and slender, with spiky black-gray hair and Sally Jessy-style red glasses, DIC Chairman and CEO Andy Heyward almost looked like a conservative businessman on the day I visited his pop-art Burbank, Calif., offices. Dressed in a tailored black suit, a white shirt and a tie, he might have passed for a banker, except for those fire-engine-red socks.
Andy Heyward loves what he does and dresses the part. He has built a cartoon empire, with an amazing 25 shows currently on the air. In only three years, since leading a leveraged buyout from Disney in 2000 with backing from mega-financiers the Bain Group, DIC has proved not only big companies can succeed in kids TV distribution.
Tiny compared with Disney or Warners, DIC has emerged as a leading supplier after school Monday through Friday, all without any Mortal Kombat-style violence. DIC series include Inspector Gadget, Sabrina, the Animated Series, Super Mario Brothers, Dennis the Menace, Sonic the Hedgehog and Madeline. “We’re in the age of Pericles,” says Heyward, a toon king who began as a writer and still loves to make literary references. “It’s a golden age.”
DIC’s golden touch also extends to TV stations, which must meet an FCC requirement for three hours a week of children’s shows that are educational or informational. They call it Entertainment Informational-compliant programming, or “FCC friendly.” “For the stations this is the headache-removal business,” Mr. Heyward tells me. “Our children’s E-1 block, as it is called, has 98 percent unduplicated coverage (of the United States), cleared on over 400 stations.”
As a true indie, DIC does business with almost every studio and network. Last year DIC shows were on four broadcast networks, the Cartoon Network, Nickelodeon, PBS and in syndication. “We have four different feeds, four separate lineups [of cartoons from a sizable animation library and new production].” Mr. Heyward said, noting that ad sales are handled by Tribune. “So you can buy a commercial and be `roadblocked’ on UPN, Fox, The WB and Pax in one market.”
He was born to the business in New York and raised from the age of 12 in L.A. His father, Louis Deke Heyward, who passed away a year ago at 81, was a writer and a producer on seminal series such as The Ernie Kovacs Show and later produced movies for AIP and was a studio executive.
Mr. Heyward found a second father in his first job, as a gofer for Joe Barbera in the days when Hanna-Barbera dominated Saturday morning with everything from Yogi Bear to The Smurfs. He graduated from bringing coffee to writing and producing, always learning. “Joe was the best salesman I ever saw in my life,” says Mr. Heyward. “It was fortunate for me to be raised by him in this business.”
DIC is able to produce a half-hour of animation for about $200,000, far below larger competitors. It does it with discipline, a lean staff and tight financial controls. It boosts revenue with licensing, consumer products, spinoffs and foreign sales. “We look to have all costs covered before we greenlight,” says Mr. Heyward.
His production is done in China, by a single low-cost supplier; and the dubbing in Nebraska, at half what it would cost in Hollywood, using players from the Omaha Children’s Theater.
Mr. Heyward was first introduced to Omaha by local resident and billionaire investor Warren Buffett, then the largest stockholder in ABC, which had acquired DIC to be its animation division. Instead, Disney swallowed ABC, and DIC’s offerings took a back seat to Mickey, Donald and other longtime Disney properties. “We were like the last person at the dinner table,” recalls Mr. Heyward. “If there was anything left over we got the crumbs.”
Despite its success, DIC now faces the possibility that the Bain partners, who typically remain in a deal three to five years, may want to cash out. But Mr. Heyward is confident that he will handle it. He won’t disclose revenues for the privately held company, but it is clearly very profitable, and growing. There are hot new properties such as Speed Racer, acquired four months ago, and Strawberry Shortcake, recently revived on home video, for which DIC now has multiple networks bidding to put back on air.
In January DIC also acquired Mommy and Me, tied into thousands of play groups around the country. They don’t sell to the kids. They sell to the moms, offering toys, music and videos.
Mr. Heyward, the father of three, also gives back. He has sponsored seminars at UCLA and currently supports a program with L.A. County Probation to mentor troubled kids.
“We’re not looking to be opportunistic or exploitive of kids,” says Mr. Heyward, who won a Daytime Emmy in 2002 for Madeline. “I go back to the early days with Joe Barbera. You’ve got to start with a story, with rich characters. It doesn’t begin in the head. It begins in the heart.”
And it shows up as a pair of red socks.