Hans Ulrich Stoef on New Venture Toon2Tango

Hans Ulrich Stoef tells TV Kids about the plans for the new worldwide production-and-distribution operation Toon2Tango.

Stoef had a long career in building brands. The former Universal Studios and EM.TV executive founded his own rights-management company, m4e, in 2003 and subsequently built it into a powerhouse kids’ and family content outfit with brands such as Mia and me. Stoef moved to Studio 100 after that company picked up a majority stake in m4e. This year, he embarked on a new journey, setting up the worldwide production-and-distribution operation Toon2Tango.

TV KIDS: What was the thinking behind the creation of Toon2Tango? How are you positioning the company in the kids’ landscape today?
STOEF: The positioning has two sides. I’m still doing what I’ve always done, which is developing and producing kids’ and family entertainment shows and films to create 360-degree IP. We also offer our expertise to third-party creators. We’ve found that, quite often, producers have fantastic IP, but at the end of the day, they are given between 2 percent and 6 percent back-end participation, they get paid for the development work and that is it. Here we’ve developed a different system; we’re incentivizing them much better. They develop shows and we will take full responsibility for the management, the financing and the executive production. The creator who had the idea and is the creative mind behind it will have higher participation. It’s what we call fair equity positions.

On the other side, since it’s a new company and we have less of an infrastructure than before with Studio 100 and m4e, we will quite often share distribution with a co-production partner. We’ll do this in a much broader way than we ever did before. To give you an example, we are developing eight shows over four years for Mondo TV. Hopefully, we’ll bring four to six into production. We are benefiting from Mondo’s existing distribution capabilities and their strengths in certain territories. For other territories, we’ll try to secure the co-production needs and the distribution needs with third parties, and we’ll only take a handful of distribution territories ourselves. For the licensing, we control the brand, undertake brand management and work with the distribution arms of our partners.

TV KIDS: What’s more challenging about setting up a new content company today compared to the early days of m4e? And what are you enjoying more?
STOEF: Consumer licensing is more difficult. Distribution via linear broadcasting is melting down because of the digital opportunities today, and digital is not catching up in delivering the number of eyeballs you need to break a new brand. I have a strong network after many years in the business and deals with prominent companies worldwide. That makes it easier. Even though we are a new company, we’ve been able to go into big deals with companies like Mondo immediately, and broadcasters have asked us if we could do something together on the development, distribution and production sides. That’s what I enjoy—without the heavy lifting of infrastructure and costs. We know it’s a challenging and ambitious market, but we have enough time and experience to put that into balance for our own projects and third-party creators as well.

TV KIDS: What qualities do you look for in third-party projects?
STOEF: I can’t tell you a specific genre because we look at everything. We try to stay away from all the mass-market stuff out there, and there is plenty of it! We’re trying to be boutique with creative and new shows. [At m4e] Mia and me was a new concept because it was hybrid and nobody in those days wanted to do a hybrid. We’re looking for those kinds of shows. Third-party creators could have great ideas that maybe don’t fit the market for certain reasons and therefore won’t become commercial successes. We work with them on creating something that is unique but has the opportunity to generate significant amounts of money.

TV KIDS: You know the L&M business very well. It’s under pressure right now with the challenges at retail. What are some of the strategies needed to succeed in this space?
STOEF: Many of the traditional retailers in Europe are closing down or buying less inventory; that’s the reality. But if you have a strong brand, a consumer will find it on Amazon, wherever. The play patterns are still the same—I don’t see many new interactive toys coming to the market that succeed, to be honest. In retail, it’s the B-to-C marketing that matters. What we’re talking about is eyeballs, and thus, consumer demand.

TV KIDS: Are you seeing financing models change as distribution models shift?
STOEF: They are not what they were 15 to 20 years ago. There was tons of money in the market, and everybody was going into gap financing. That’s not the case anymore. Instead, people are looking for government money, tax credits, subsidies and whatever is possible. Even upfront distribution guarantees are pretty tough to manage right now. Part of the problem is that there are too many mediocre shows from small distributors or producers who have no idea what they are doing, and they are still getting partially financed by regional or country subsidies. That is going to change. If producers have no real business model behind them, it’s over, and they won’t get the money anymore. In the future, creative talent will have to work even closer with companies like us; otherwise, their shows will not be produced.

TV KIDS: Are you looking at opportunities to adapt existing IP such as books and comics or focusing on new ideas?
STOEF: It could be book adaptations, it could be game adaptations or it could be comic adaptations, whatever we like. We have no intention to produce five to six shows a year. That’s not what we want to do.

TV KIDS: What message do you want to send to creatives about Toon2Tango?
STOEF: We want to encourage them to contact us when they have a great project and they don’t know how to get it to the next stage. They should speak to us. We’re happy to talk, give them some of our suggestions of what we would do. If we like the show, we can find a way to work with each other in a fair way. That’s very important. We don’t want a me-too product to an existing show or the 110th gender-neutral comedy property. That’s simply not us!