How to Kill a Successful Business: The Slow-Motion Death of VeggieTales

http://www.philvischer.com/?p=38

by tom_rath • 18 years ago

36 35 18 years ago

The creator of VeggieTales outlines how he plodded towards the death of his company, Big Idea Productions.

It all seems to have been painfully avoidable, and I find this story a reminder that even successful businesses can be brought to failure if one isn't vigilant.

coglethorpe• 18 years ago

> “It looks cheap!” “It looks like something my kids can watch on the Cartoon Network for free!”

I demand only the highest quality animated vegetables.

iamwil• 18 years ago

That was a long, yet good read. I too have read Built to Last, and I'm rather surprised that by following the book's convictions, he got himself into trouble.

I guess the main lesson I took away was to live well below your means, both in personal life and in business, because you don't know what the future's going to be like. Projected sales of veggietales was way off mark that he kept approving expenses in ventures and territories he wasn't experienced in.

mixmax• 18 years ago

Correlation does not equal causation.

It seems to me that built to last ignores this fact. I have only read the executive summary, so I might be mistaken.

hernan7• 18 years ago

Moral of the story: don't take management advice from /Built to Last/ or from God.

rms3• 18 years ago

Or, don't use God as an excuse to take the risky path every time.

lunk2• 18 years ago

Don't Take Management Advice from god. I am writing that one down and putting it on my bulletin board. :)

bouncingsoul2• 18 years ago

Wow, that was long.

Here are some sections I think are interesting for people who don't have time to read all eleven parts:

> We were proposing to triple our expenses, while only doubling our sales. More concerning, we were proposing to double our staff size, without increasing our ability to produce films. Of the 165 hires being requested, only a handful were in the animation studio. Ninety percent were in finance, HR, marketing, licensing and design. So at 315 people we would be able to produce no more videos per year than we had produced five years earlier with a staff of 10.

> Did I want to release all of this product? Did every last bit of it have a compelling ministry objective? Did it all fit into my “masterplan” to benefit America's kids? Frankly, no. None of it was against our mission, and most of it promoted a biblical value or virtue in some way, shape or form, but the sheer volume was driven not by mission, but by a desperate need to keep Big Idea from collapsing. Many of us felt the tension between our ministry-driven mission and the vast amount of merchandise we were attempting to drive into the market. The pace of work, however, left precious little time for introspection.

> There were no comparables for VeggieTales. Our sales had skyrocketed 3300% in four years! Against that backdrop, how do you project the future? More skyrocketing? Was our growth almost done, or just getting started? Look at another example: Between Christmas 2003 and Christmas 2004, sales of Apple's iPod increased by a staggering 500%. A huge success, but also a huge challenge. How many iPods do you make for Christmas 2005? 500% more than 2004? 100% more? 10% less? Unprecedented success is extremely difficult to manage simply because it is unprecedented. Every year is a big ol' guess.

> I was a shy kid who would rather read Starlog Magazine or build a rudimentary optical printer out of cannibalized 8mm projectors than show up at the prom or run for student government. As VeggieTales took off, I became terrified that my business inexperience and lack of people skills would result in Big Idea's failure. So, in a panic, I brought in others to help, often spending far too little time getting to know them before or after the hire. I then backed down from my own convictions, assuming that an executive with an impressive resume surely knew better than a Bible college dropout.

* * *

So many decisions involving tens of millions of dollars were made based on nothing concrete. Not even gut feeling. Just blind hope.

And it's horrible because the stuff they guessed about is knowable to some extent. I seriously doubt Apple goes into Christmas having no clue what the iPod demand will be. It seems like simple market research would have clued them in.

Interesting too is the settling that happened in picking the first executive team. He couldn't convince the best people to move, so he settled for second tier. That seems like a horrible decision: spending just as much money with lower chances of success.

I'm sad to see the company go down, but some of the decisions made were just dumb: Obviously a cheap, 2D spinoff is not going to be as successful as its parent. Why would you agonize over firing 30 people when the entire company is going bankrupt in months?

There's a lot to think about in this story.

willchang• 18 years ago

Not just a second tier executive team, but second tier legal counsel as well. It's telling that he felt sorry for his lawyer after he lost a case that he should have won handily. Like many people who focus on making something good, he's just way too nice. He doesn't seem to understand the implications of the fact that many people get wealthy by securing a piece of a carcass that other people kill.

SwellJoe8• 18 years ago

I'm a bit ashamed to say it, as I'm sure the people involved are all very nice, and I don't wish them any ill, but I'm smiling to learn that the company behind Veggie Tales is dead. I was pretty much disgusted when I watched a few episodes with my nephew. It's rather obnoxious Christian propaganda, and I really don't think kids should be exposed to that kind of thing in the guise of cute cartoons.

bouncingsoul2• 18 years ago

Really? I've only seen a couple a while back, but I thought the preaching was really tame; it was mostly be kind, don't lie, etc. kinds of messages with a isn't God wonderful tacked on the end.

SwellJoe8• 18 years ago

So perhaps I'm overly sensitive, but in the couple of episodes I saw, it seemed pretty overtly superstitious, to me. My sister (the mother of the nephew in question), who isn't religious, also defended them as being "ethical rather than religious lessons"...and she saw a lot more of them than I did. So, perhaps I judge too harshly. But when/if I have kids, I expect I'll avoid the religious stuff when looking for ways to entertain them.

lunk2• 18 years ago

You must have missed the "3 minute wrapup" at the end. They do light preaching throughout, then hammer you with the "Things you should have learned about god and the "right way" " at the end of each show.

I agree with the original post. It's christian propoganda. Not that there is anything wrong with that, but it never belonged in the mainstream. THAT is why sales of videos never went above 7 million per year. There is no market for a "christian god" with a lot of people. That is the thing he never mentions. His market was limited from the start, and he STILL doesn't see that...

Spyckie• 18 years ago

good read.

It's interesting - the author wasn't pressured by external forces (VCs) to grow big - he wanted to grow big as fast as possible. He didn't grow because of demand but because of his dreams, which is the number 1 reason why he failed. It's strange, too, because he wasn't competing to capture market space; nor was he under any sort of deadline to sell the company at a certain valuation.

If the author had just kept on making veggie tales like he had been doing before he wanted to grow big, the company would have been fine. Veggie tales was a solid product that had everything going for it.

brianr• 18 years ago

One of the more interesting pieces of this story is how different Vischer has dealt with failure than a more typical startup founder. It seems like failure is usually quite acceptable, if not even applauded, but Vischer seems to feel a significant personal failure. His apology paragraph on the last page is especially telling, and I would guess quite rare in the realm of "startups."

samwise• 18 years ago

Not everyone can lead a company. luck can only take you so far.

gscott2• 18 years ago

I believe if he ran the company himself instead of leaving it to other people then he would have been fine. His common sense was right on, he just didn't have the faith he should have had.

I am unsure how much he prayed about his decisions, but I believe he didn't pray enough and listened to other people too much.

icky• 18 years ago

> I am unsure how much he prayed about his decisions, but I believe he didn't pray enough and listened to other people too much.

Prayer as a surrogate for decision-making?

How to Kill a Successful Business: The Slow-Motion Death of VeggieTales

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