Company Profile - Holotoyz

Adding tech to play

Kid-tech specialist HoloToyz has enjoyed a remarkable first couple of years, largely thanks to the passion and drive of its co-founders, husbandand-wife team Declan Fahy and Kate Scott, and Paul Cosgrave, a longtime business partner. In this exclusive interview, Declan and Kate share why they believe tech has a place in play, what new licensing deals bring to the table, and their plans for the future.

‘Positive’ is perhaps not a word everyone would choose to describe the past two years, but for HoloToyz, which was officially founded during the first lockdown in March 2020, it’s a very suitable one. Right before Covid struck in Europe, Kate explains, she and Declan had exhibited the HoloToyz concept – stickers, temporary tattoos, books and wall decals that come to life through the magic of Augmented Reality (AR) - in Nuremberg. It proved so overwhelmingly popular that upon their return from the show, the duo, whose backgrounds are in digital sales and marketing, decided to take the plunge. Just over two years later, HoloToyz has major licensing deals with Paw Patrol and Sonic the Hedgehog under its belt. The company also won Silver in the Editor’s Choice Awards at London Toy Fair 2022, following a snap decision to exhibit following the cancellation of this year’s Spielwarenmesse – not bad considering the company, up to now, has been run primarily from Kate and Declan’s living room.

“In 2021 we took part in Spielwarenmesse digital, and it was at that point licensors started to get in touch with us about working together,” Kate says. “We’re now working with Paramount on launching our Paw Patrol range. In 2021, we were also introduced to the team at Sega, who loved what we were doing and saw a real synergy with Sonic the Hedgehog. The timing of these deals couldn’t be better: the recent Paw Patrol movie was a huge success, and a follow-up has now been greenlit, while Sonic 2 has just landed in cinemas. A third feature length Sonic movie, a new animated series and a game are also in the works; there’s so much going on and things are accelerating all the time.”

Declan notes that Covid appears to have either helped or hindered businesses. When viewed through the HoloToyz lens, it’s certainly done the former. The pivot to digital meetings and shows has made the world smaller and infinitely better connected, helping the pair get in front of people across the globe without the associated travel costs and ‘dead’ time – time which could be better spent working on things behind the scenes. It also made it easier to secure meetings with big companies that might not have had the time or inclination offer slots at busy trade shows, something many start-ups find challenging. Finally, the shifts in the ways of working brought about by Covid have also allowed Kate and Declan to strike a much happier balance between work-time and family-time, something they both feel is exceptionally important.

The couple have two children, a five- and an eight-year-old, and their experiences as parents have helped shape their view of the toy sector. Kids these days are digital natives, Declan notes, and therefore enjoy interacting with, and seeking out, technology. HoloToyz isn’t the first company to bring AR to play, but it’s seeking to leverage it in a new and very innovative way. The HoloToyz tech adds a layer of fun and education to traditional toys for generation Alpha. At the same time, the duo know a connection to the physical world remains important, which is why HoloToyz is growing its portfolio with new physical toy products.

We pressed Kate and Declan on the idea of screens being a part of play. It’s a divisive topic: you’re either Team Screen, or Team Screen-Free. In response, Declan recites a quote by the Belarusian- American entrepreneur, author, speaker and internet personality Gary Vaynerchuck, whose big ideas on tech and the future of societies are seeping more and more into the kids’ space: ‘Don’t put the past on a pedestal and demonise the future.’

“Yes, children today do have screens in front of them a lot of the time – and in the future, they’ll practically be living in screens,” Declan expands. “Like it or not, the digital space is only getting bigger, and AR is a growing part of this. HoloToyz speaks to parents looking for toys made for the kids of today. We know our concepts won’t appeal to everyone, and nor should they: brands shouldn’t be a hit among absolutely everyone. If they were, we’d see just a few companies with a monopoly on practically everything.”

Kate interjects here with her opinion – one shared by many, we’re sure – that fear kills growth. She says HoloToyz has experienced pushback from retailers that won’t stock anything involving screens. Both she and Declan are entirely at peace with this, noting that such retailers clearly aren’t their target market and that everyone in business must stick to their principles. There’s plenty of space in this industry for both traditional and tech toys: after all, if all parents took a strict screen-free view, Nintendo arguably wouldn’t exist. And plenty of retailers are on board in a big way. A buyer at FAO Schwarz in Dublin, for example, is apparently hugely excited to ‘finally find something cool the kids of today will love’ in the HoloToyz range.

Kate also reiterates an earlier point Declan made, regarding the way HoloToyz AR tech enhances physical play. The company’s books, stickers, tattoos and wall decals can be enjoyed without using the 100% kid-safe app HoloToyz has created for the purpose of bringing the AR to life. The company’s new Paw Patrol tattoos and stickers, for example, offer exactly what you’d expect from a traditional creative product: it’s just that kids can then bring them to life with AR. The tech is an ‘as well as’, not an ‘instead of’ addition to traditional physical play, something the co-founders are keen for parents, retailers and licensors to understand.

As the HoloToyz business gathers pace, there’ll be a 60-40 split in favour of the company’s own content. The rest will be licensed. Education will play a core part in product design, with tangible learning outcomes on offer: there’s much more awareness now of how different learning styles impact a child’s development, and many studies have shown that AR can boost learning among those who favour visual educational styles.

As mentioned earlier, HoloToyz has struck some very impressive licensing deals considering its tender age. Describing the landing of the Paw Patrol deal as a ‘pinch me’ moment by Declan, the pre-school property caters perfectly to 3–6-year-olds. Sonic, meanwhile, skews slightly older, from 7-10-year-olds, and is very popular among parents who remember the character from their own childhoods. Together, the two properties neatly span the company’s entire target market. In addition, they have given the company the scope to massively push the boundaries of what its technology can do. The Paw Patrol range, to give one example, lets kids place the animated pups in the room with them and pose for photos and videos - even interact with them.

Kate and Declan are clearly enjoying working in the licensing sector, which they describe as friendly and supportive. Early on, they tell me, the marketing and licensing consultant Julie Ball was generous with both her time and her experience, and the HoloToyz co-founders are exceptionally grateful for her guidance. By the sounds of it, their experiences with Julie are reflective of how they have found everyone in licensing; indeed, the pair can’t sing the praises of this industry enough.

Conversations with new licensors are ongoing behind the scenes. Toy World is in the know but can’t reveal anything at this stage, other than that the properties in the spotlight are very big indeed.

“It’s very important to note that we’re not working with a property just for the sake of it,” adds Kate, as Declan nods enthusiastically. “We’re choosing to work with licences we believe in; they have to align with our strategy and vision, and they also have to bring value to parents. We’ve said no to licences because they don’t meet these criteria. We love Paw Patrol, we love Sonic, and we love the other properties we’re in talks with. We won’t sacrifice that integrity.”

HoloToyz has set its sights on growing its international distribution network. Its licences are both available and popular in a wide range of countries, while the core range of generic product – which will never form less than 60% of the business - holds global appeal. Another key goal, Declan explains, involves localisation. He says London Toy Fair showed he and Kate there’s a ‘hunger’ within the toy industry for a localised app that offers something for everyone, no matter where they’re from. This will help turn HoloToyz into a truly global brand. The company is also working with international experts to plug the gaps in its setup in terms of finance, sales and creative processes, and to really get under the skin of the company’s DNA.

Product development is a part of this. The company was founded with a view to bridging the gap between physical and digital play, and it therefore wants to take ownership of an AR category in toys. Over the next two to three years, HoloToyz will be building out its core toy offering. Kate says one piece of feedback she and Declan receive at times is that the company name currently isn’t reflective of what it makes, but new developments will rectify this. Product will largely sit within the activity and crafting categories – play patterns that have stood the test of time, and products which will be elevated by AR. Kids will be able to create something of their very own, then bring it to life through the magic of augmented reality.

Kate and Declan’s backgrounds in digital sales and marketing give them real insight into what retailers need from their suppliers. Brand awareness is key, especially for a young company such as HoloToyz, so the pair has created impressive POS and is more than happy to work with retail partners on bespoke solutions tailored to individual stores. As a very audiovisual brand, digital will be key to marketing efforts. Trusted content creators will be a part of the mix, demonstrating the HoloToyz books, stickers, tattoos and wall decals to their many followers. Millennial parents are a key target market. The end goal will be to drive consumers into bricks & mortar stores – something that will be music to the ears of many a Toy World reader.

“We’ve been welcomed into the toy industry with open arms, and we’ve already made what I’m sure will be lifelong friends over the past two years,” adds Kate. “Since winning Silver in the Editor’s Choice at London Toy Fair, there’s been a great buzz around HoloToyz and what we do, and we’re both really looking forward to what lies ahead. Our technology offers huge opportunities for the toy industry, and allows kids to play and learn in a new, immersive way. And from the conversations we’re having, this is both recognised and appreciated.”