In the wake of its acquisition by Tornante Group, Topps has been reorganizing its WizKids game division.  That has included cutting down to its three main brands (see “WizKids to Concentrate on Core Brands”), but is also including staffing and management changes. 


We caught up with WizKids Executive Vice President Joe Hauck at San Diego Comic-Con last week to talk about those changes, which include his departure from the company effective today, August 1st.  Some executive functions are being transferred to New York.  In Seattle, Justin Ziran will move to running the day to day operations of WizKids from his current position as Director of Brand and Marketing.  WizKids President Lax Chandra remains with the company and will likely be broadening his responsibilities. 


Tell us about the management changes at WizKids.

We are changing our managing approach at WizKids so all of our game-playing expertise will remain in Seattle and all of the functions that could be done anywhere--accounting, logistics--are moving back to be integrated within the Topps system.  It’s actually a little bigger than that in the sense that the actual WizKids group has also merged with the Entertainment business.  We had made that announcement a couple of months ago, but really what that means is the entertainment business as a whole will be working as a unified unit, so all gaming and entertainment and future IP development and future videogame development, anything that we’re doing in those spaces, will all be a unified front between Topps and WizKids. 


And that’s really the best value out of the whole deal for Topps--you’re unlocking the accretive value of adding those groups together.  You have the expertise of licensing and licensing out from Topps, you’ve got the expertise of managing the mass market from Topps, you have the expertise of managing the core hobby from WizKids, you have the game play and all that stuff working together--so everyone has their oars in the water at the same time rowing in the same direction.  And that’s really where the biggest value is.


We were surprised to hear that there were still some administrative functions in Seattle.  Normally in an acquisition, a lot of administrative functions would be centralized right away.  It sounds like that shift is happening later than usual in the Topps acquisition of WizKids.

Absolutely.  You hit the nail right on the head.  It’s one of those things where--and other  companies have gone through this--they buy a company that they don’t have a discipline in or they don’t understand what that is, but they know it fits in and it’s a good additive feature to their company.  WizKids is not the first hobby game company bought by a mass market company or a larger company.  The first inclination is, it’s a successful business, so don’t touch anything because you don’t want to jinx it, you don’t want anything to happen.


When I came on at the middle of 2006, it was because they wanted to look in a new direction and they wanted to do new things.  Very quickly Lax and I had recognized the fact that there was a lot of functionality that was redundant and there were some things we could do bring the groups together.  But, at that point you have to remember that we were a publicly held company and being a publicly held company there was a concern that we might have to sell WizKids someday just because some shareholders win a vote and they tell us to.  So at that point, it’s really hard to sell a company if you say, “It works really well and it’s great and it’s really profitable, but you’re going to have to figure out how to bring all of those functions in yourself because we have them done all out here [in New York].”  It makes it very muddy to do that, so we left it as a self-contained unit.


When the acquisition by Tornante came around, that was a point for us to sit down and say, all right, what’s the white slate?  If you take the white board and just erase away everything and say, what’s the best way to unlock all the value between Topps and WizKids together, what does it look like?  That’s the way we drew it and presented it to Tornante and Topps.  They looked at it and said, that makes a lot of sense so that’s why we’re going that direction.


Who oversees Topps Entertainment, which includes all of the sports as well as WizKids now?

They’re still working on what the reporting structure will be at Topps, but they have plenty of executive talent out there, which is one of the reasons why I’m leaving.  So it’s not a question of was Topps unhappy with what I did or how things were working out.  When Lax and I presented to them and said “Here’s the white paper of what you should do,” I became superfluous at that point.  They’d like to find something else for us to do, and for me, since I’m not going to move my family to New York, it’s a question of what can we have Joe do remotely from Seattle.  Right now, they don’t know what that is, but in the future that’s what they’re thinking about.  We’ll figure out down the road if that makes sense.


And what about [WizKids President] Lax [Chandra]?

Lax is still there.  We’re handing the reigns over to Justin who’s worked with me for many years in a variety of different roles.  He’ll manage the Seattle group and report into New York, we’re very confident, because he’s had to do that before in previous positions.  From that perspective, everyone’s very confident in Justin’s abilities and think it’s the right thing for everybody.  When we get a lot of the functions transitioned then Justin will take over the reigns this fall and at that point they’ll figure out what Lax will do.  He’s a valued employee of the company and there are a lot of projects and initiatives--a lot of things that are moving fast. 


There are a lot of projects that are being working on with Topps right now that are not publicly announced yet.  There’s a lot more group interaction between WizKids and Topps than there ever has been and so now there’s a lot of joint projects on the table.  There’ll be more announcements coming up, so there are going to be very exciting things for the marketplace from Topps and WizKids.