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By Jonathan Stempel
(Reuters) - Squishmallows joined Warren Buffett's business empire two years after Lady Gaga, Kim Kardashian and others helped make the plush stuffed toys a viral sensation on TikTok.
For Judd and Laura Zebersky, whose company Jazwares makes the toys, the success of Squishmallows is hardly what they imagined when they met 33 years ago at the University of Miami law school.
They married in 1993 and embarked on law careers, but Judd Zebersky soon realized that wasn't his destiny. Four years later, he started Jazwares, where he is now chief executive.
"I have really loved pop culture since I was a kid," Zebersky said in an interview at this month's annual shareholder weekend for Buffett's Berkshire Hathaway Inc in Omaha, Nebraska.
"I was into comic books and toys, and I'm also an artist--a not very good one," he said. "I looked at my wife, and I said, 'I want to make toys.' She said, 'Follow your dreams,' and that's what I did."
Laura Zebersky, a litigator, sold her practice in 2005 and joined him, becoming Jazwares' president.
Jazwares sales topped $1 billion in 2021. About 40% came from Squishmallows, as the number sold passed 100 million, and the rest from in-house and licensed brands including Fortnite, Pokemon and Star Wars.
Berkshire bought Jazwares' parent, insurance holding company Alleghany Corp, for $11.5 billion last October. It has not since discussed Jazwares' business performance.
"Jazwares is a gem," Buffett said in an emailed statement. "And, Judd and Laura are the ideal Berkshire managers."
STRIKING A NERVE
Other businesses in Berkshire's stable also make toys, including Oriental Trading's rubber ducks resembling Buffett and his longtime business partner Charlie Munger.
But it was Buffett and Munger Squishmallows that were arguably the hot item during a shopping event at the Berkshire weekend, with shareholders scooping up 10,000. Before long they were fetching more than $500 at auction on eBay.
Launched in 2017, Squishmallows became part of Jazwares when it bought another toymaker, Kellytoy.
The Zeberskys thought the squishy toys could be a hit but had not been marketed well to a mass audience.
There are now more than 2,000 Squishmallows, each with its own name, birthdate--or "Squish date"--and biography.
"This was a brand that needed a lot of love," Judd Zebersky said. "It struck a nerve, and when you strike a nerve in the toy industry, great things can happen."