Nukotoys aims for next-generation toy empire

To hear Rodger Raderman and Doug Penman tell it, one of the biggest shortcomings of the modern toy industry is that it has little in common with Silicon Valley. And the two are here to remedy that situation.

Raderman and Penman are the co-founders and co-CEOs of Nukotoys, a San Francisco-based company that is aiming to take the best elements of the Silicon Valley startup--rapid prototyping, interactive technology, nimbleness, financial efficiency, and scalability--and apply them to the business of making fun, engaging, and educational toys worthy of the second decade of the 21st century.

For sure, that means a mixture of offline and online presences, but Nukotoys hopes to win over millions of kids--and their parents, of course--by bringing a special blend of mixed-media and online and offline interactivity to a series of games that are tied in to some of the most popular franchises and media properties in the world.

For starters, the company has partnered with the creators of the best-selling Ology books--"Dragonology," "Wizardology," "Egyptology," and "Oceanology," as well as with the Animal Planet network, PBS Kids, and others for several of its initial products. It is also developing its own titles, and while it is still in the early stages of product marketing, the company has already moved more than seven figures' worth of its products.

According to Raderman and Penman, Nukotoys' products mix social and collaborative online game components with the instant feedback and fun of playing with scannable trading cards with friends. And the products are designed to allow kids to get the most out of the toys regardless of whether they're playing online, are using an iPhone, or are just fooling around in the schoolyard.

Trading cards with special skills and tools
To begin with, kids will start collecting Nukotoys trading cards--each pack of which will contain individual cards embedded with special skills, tools, and the like that can help the kids do better in the games themselves.

In a game like Cryptids, for example, which, according to the company is based on a "kids' movie being developed by Odd Lot Entertainment," kids are transported "into a hidden world anchored by the ancient, secret Royal Society of Cryptozoologists, where they must find and protect rare 'undiscovered' creatures such as the Tizzly, Chucabarra, and Yeti."

The idea is that kids will buy the cards (which Raderman and Penman say will cost more than a normal pack of cards, but which will be "cheap enough to afford with an allowance") at retail, as well as an under-$20 scanner, and then begin playing the hybrid toy/games. The cards--which have a small embedded chip on them that is scanned using near-field communications--contain skills or tools that can help in the games. By scanning the cards, the kids can take advantage of the skills or tools.

One example comes from Cryptids. (See video below.) In it, a player may find him or herself crossing a rope bridge that suddenly collapses. If the player owns the grappling hook card, he or she can scan it, and in the game, they will then be able to use the hook to save themselves from falling into the ravine below.

Nukotoys expects that players of these games will be highly social, and will find themselves trading for the physical cards that help them in the game. So if one kid needs the grappling hook, and another has the card, they may well make a trade in the schoolyard. This highlights a major social element of Nukotoys' strategy in that the online games will make the assumption that the two kids who made the trade are friends, and will then connect them in-world. Kids will not be able to make in-world friends with strangers.

Nukotoys also hopes that kids will play its games on their computers and on devices like an iPhone, iPod Touch, or iPad. While it's not clear that many kids have these devices, many of their parents do. Either way, game play on such mobile devices is feature-rich, Penman and Raderman said, and kids can also use them to control what's happening on-screen on their computers.

Up to four kids will be able to play the games simultaneously, from multiple locations.

Going after Webkinz and Club Penguin
Almost any parent is familiar with Webkinz and Club Penguin, two children's properties that set the standards for online social play for kids. And while Raderman and Penman pay due respect to those titles, the two entrepreneurs believe that what they're building with Nukotoys will far surpass their massively successful predecessors by building in what they say is much richer social elements, interactivity, and cross-platform connectivity.

As the co-founders have gotten the company off the ground, they've turned to a very talented group of executives and advisers for help. Among them are Chief Operating Officer Mike North--who was a host on the innovative Discovery Channel show "Prototype This"; Peter Adkinson, the founder of "Magic: The Gathering" and "Pokemon" cards publisher Wizards of the Coast as well as Richard Garfield, the creator of both of those cards titles; Bob Christopher, the former CEO of Pleo maker Ugobe; Karen Gruenberg, a former director and executive vice president of content of PBS' long-running hit "Sesame Street" and who also developed the hit series "Dragon Tales" and "Sagwa." Garfield is designing the overarching card system for Nukotoys.

"I thought [Nukotoys offered] a wonderful merger of the online and offline worlds, (being) able to take traditional media, like books, or trading cards, and have them truly integrated into the experience," Gruenberg said about her decision to become a company adviser.

To Christopher, Nukotoys' work represented what he saw as occupying a lot of the time of researchers at places like Stanford and the MIT Media Lab: the promise of the cross-pollination among mobile devices, online communities, stand-alone real-world products, and computers.

"The idea is that they're really building a persistent experience across online, virtual worlds, games, [and] offline devices," Christopher said, explaining his decision to become an adviser. "The whole idea is that you don't lose the sense of community, the sense of gameplay because you're not sitting in front of your computer. It can go anywhere you're at."

For now, Nukotoys is focused on its upcoming properties: In December, it will launch the U.S. Department of Education-funded Mission to Planet 429 for PBS Kids--which uses a sci-fi twist to help kids learn to read, and which is the first-ever such game PBS has put its name on--and in fall 2011, the company expects to launch Oloverse, "a fantastical virtual world and interconnected trading card game based on the..."Ology" books, which have sold more than 20 million copies worldwide to date.

Also in fall 2011, Nukotoys will launch its virtual world and card game based on the Animal Planet brand. The company touts the potential of that partnership given that the Animal Planet TV network reaches more than 230 million households worldwide.