Club Penguin Sold to Disney for Big Bucks

Tony Wanless

| August 5, 2007

The trio get $350 million in cash, $350 million in future payments, making a payday for each in the neighbourhood of $115 million. The three will also join Disney as senior execs responsible for the popular (700,000 subscribers, paying from $6 to $58 a year) online Antarctic world in which animated penguins are avatars for kids around North America.

They should be excited. Club Penguin is a great BC story. The three started their company by themselves in 2005 and within two years bootstrapped it to one of the most popular and lucrative kids sites on the Web. It's the dream of every BC entrepreneur – start a company with nothing and grow it rapidly to the point where someone comes in and pays hundreds of millions for it.

I had to laugh when one blogger referred to Club Penguin as existing somewhere in “remote British Columbia”, as if to imply that it was out in the absolute boonies, which of course made the deal even more outlandish.

But thinking on it, maybe they inadvertently had something there.

In an interview with paidcontent.org, Merrifield, a former Disneyland employee, said at least $30 million of the sales proceeds will go to a charitable foundation the three started along with their company and have been contributing 10 per cent of their net profits to all along. “It's part of our DNA,” to put something back into the community,” he explained.

Also, Merrifield suggested that the deal with Disney wasn't solely about getting rich. The group had similar offers from other companies, but didn't take them. Instead, he said, it was about picking the right partner who would fit the values the three hold. They didn't want “certain kinds of money” and the sale to Disney would supply an infrastructure for expansion to touch kids in other cultures and languages.

“At the end of the day, the dollars were not really a priority and never have been,” he explained.

So, we have here in BC three new Web millionaires who could have made more but stayed true to their values, will remain in and continue to help their “remote” communities, and will actively continue working to expand their virtual community around the world.

Personal values instead of money. Gee, I guess that is kind of remote.

Tags

"Personal values instead of

Submitted by Zentrepreneur (not verified) on Wed, 2007-08-08 17:29.

"Personal values instead of money. Gee, I guess that is kind of remote". Not as remote as Tony thinks. As a matter of fact there is a whole new growth movement of "zentrepreneurs" and you'll find them in Allan Holender's new revolutionary book, "Zentrepreneurism-A 21st Century Guide to the New World of Business. He describes, an entrepreneur as someone who :"creates a business', while a Zentrepreneur is someone who "creates a business and a life". Indeed I believe we may be entering an new era of enlightened capitalism, where the bottom line is not the only reason to be in business. His website is www.zentrepreneurism.com and his very whimsical but eye opening blog is at www.buddhaspeaksbiz.blogspot.com Zenfully, A proud Vancouver Zentrepreneur

I was being sardonic, of

Submitted by Tony Wanless on Fri, 2007-08-10 07:48.

I was being sardonic, of course, when I described values in business as a remote concept. I was far more excited by the fact that the Penguin Club founders valued concepts like community more than money. I think we're starting to see much more of values based business, as evidenced by the trend to open source and other "community" businesses, environmental enterprise, and social entrepreneurship. Universities are starting to teach social enterprise as part of their business education programs, and it's been said that social entrepreneurship will be to the 21st century what entrepreneurship was to the 20th. . Allan and I have discussed this on occasion, and I think he has a great idea there. Anyone who promotes values-based business, or "enlightened capitalism" is doing a good thing in my books. Keep it up!