From Sawdust to Paw Patrol: The Spin Master Story (with Ronnen Harary) - Econlib

0:37Intro. [Recording date: May 28, 2026.]Russ Roberts: Today is May 28th, 2026, and I want to remind listeners before introducing today's guest that we're doing an EconTalk Book Club around The Iliad by Homer. Last week's episode was with Ido Hevroni of Shalem College, introducing the book, providing some useful context to help you get started. Another episode, or episodes--depends--later[?] in the weeks to come. We're using the Fagles' translation, but there are many others to choose from.And now for today's guest: entrepreneur, television and film producer, Ronnen Harary. He is a co-founder of the Canadian children's entertainment company, Spin Master, the co-creator of PAW Patrol, a preschool series that airs in 160 countries.Spin Master had revenue of 2.3 billion in 2024 and is the fourth-largest toy company in the world behind Mattel, Hasbro, and Lego, and he's the author of No Experience Necessary: Why Betting on Yourself in Your Twenties Is the Best Decision You'll Ever Make, which is our topic for today. Ronnen, welcome to EconTalk.Ronnen Harary: Thanks, Russ. Thanks for having me.1:41Russ Roberts: Now, this is a very entertaining and thoughtful book. The point of the book is to encourage young people to take a chance, start a business. And a lot more to the book than that. It has some moral lessons and life lessons, business lessons.I want to start with risk because when you encourage people to start a business, well, everyone thinks, 'Well, that's risky,' and you say it's a misunderstood concept. In what way is it misunderstood, and what do you think is the right way to think about it?Ronnen Harary: A lot of people look at the pros and cons of starting something, and you can always game out the downside. It's really, really easy to game out the downside. It's very hard to game out the upside because you don't know what's going to actually happen. It's actually beyond all our imaginations what's possible.But, if you don't start, then you miss out on the screenplay of your life.

And it's kind of why I wrote this book, because a lot of people have a lot of pressure from their parents. They have a lot of pressure from society. And, they doubt themselves. So, I wrote the book actually so people can either make the case to themselves to take a risk in something--whatever it is, in business or in arts--or to make the case to not do something, and to create a conversation and to reframe their thoughts around what is possible in their life.Russ Roberts: You make the point, which I think is profound, and certainly a good economist knows this; a bad one might miss it. But, we often think about the risk of losing money. You start a business. Whatever you put into it is going to be gone. You could have a crushing disappointment. But the main thing people tend to focus on is the money. But, you point out if you don't do something, you may be misusing your time, and in many ways that's more precious than money. Nothing really goes bad often. You can recover, especially when you're young, from losing some money. Wasting your life is a different matter.Ronnen Harary: Yeah. I think that we focus a lot on the money, and we don't necessarily focus on what we want to do with our life.And, I also think about the whole notion of equity. What you trade off when you don't take the risk to do something for yourself, especially in the realm of starting your own business, is that the time that you're putting into an endeavor and by working for another company, all the upside is going to accrue to someone else. It's not going to accrue to you. So essentially, you're renting your time--right?--versus having that time accrue back to you and looking at your earnings over a long arc.So, I encourage people to look at your earnings over a 20-year period or a 30-year period. Obviously, if you start a business, your earnings at the beginning are going to be much less than they will be at the end; but divide it back over 30 years, and I bet you your yearly will be higher than the first 10 years if you rent out your time to someone else.It's a hard thing. And especially when you're young, it's hard to think that far out into the future.

But, I think that the other thing about risk--I think a lot about passion, and passion de-levers risk.So, if you're really passionate about something and you don't necessarily have the experience to do it, but you're super-passionate and you have an idea, I think the passion will de-lever the risk. If you're just intellectualizing your way into a business or an opportunity, it's not going to work. But, your passion and the fact that you're super-young--you have so much energy--so if you match the energy with the passion and the fact that so many people are rooting for you when you're young and starting a business, like, everybody wants to help you.5:23Russ Roberts: Let's turn to your first product, which is absurd. There's maybe, I don't know, I'm guessing, I didn't look carefully, might be 10 or 15 pages about this product and how it came to life. It's really hard to believe it was a success, I have to say. It was called the Earth Buddy. So, first tell us what it is. It's remarkably unappealing, I have to tell you, when you read about it in the abstract.Ronnen Harary: Well, yeah, we should have added some pictures. Basically, it's kind of like a 1990s version of the 1970s Chia Pet. So, it's in the size of a softball. It's made out of nylon, sawdust, and grass seed, and it's got a happy face on it. You put it in water, and it grows grass for hair.Russ Roberts: And, that's it.Ronnen Harary: That's it. But, it's more than that because it's so magical because you would never imagine grass growing from this softball, and it does it over the course of seven days, and so it's quite magical. It's like a fun houseplant.Russ Roberts: The design of it, and you described this very entertainingly, you had to try some different things. It wasn't a first time out of the box, right?Ronnen Harary: Yeah. Well, if we back up, the actual idea came from someone in Turkey. No one really knows whoever invented it, and somehow people in Israel found out about it.

I found out about it from my mother, who was reading the Yedioth Ahronoth, which is an largest Israeli--the largest Israeli newspaper. And there was a six-page spread about these six different individuals that were manufacturing the product. And in classic Israeli style, they all boasted about how many they were selling.Basically, I added up all the six, and it came to like 300,000 pieces in a country of 10 million. I was, like, 'Wow, no one's doing it over here, so we could sell millions here in North America.' So, that was my calculus. I didn't look at it the way you looked at it and said it was ugly. I was just looking at the numbers, actually, and the fact that no one was selling it over here.So, my late grandmother brought us--me and my sisters--three Earth Buddies for presents. They were called Grassheads in Israel. And, I took them to my business partner, Anton, who we had a small business at university, and I said to him, 'What do you think about manufacturing and selling these in North America?' He thought it was crazy.So, it took me two weeks. He was like you, actually. He was like you. So, it took him two weeks to decide. And then, he's, like, 'Okay. Let's do it.'Then, the next thing we know, we found ourselves in Kmart buying pantyhose and trying to source sawdust and grass seed and trying to figure out what's the right grass seed. Because we didn't have the recipe. We had to reverse engineer the product.Russ Roberts: So, the part that's the narrative of how this product goes from a--you're 22? 23?Ronnen Harary: 23.Russ Roberts: So, you make 5,000, and your first attempt is to sell them on street corners. And, you sell a few hundred, which you later realized was a miracle, but at the time was depressing, right?Ronnen Harary: Correct.Russ Roberts: So, you get this break. You mentioned Sam Kotzer[?] before. He buys a bunch, which is great.

You tried flower shops and other things. But, the heart of the story, which is unbelievable, is you have a connection to Kmart. I haven't heard the word 'Kmart' in a while. I looked it up. They've fallen on hard times. According to Wikipedia, they have four stores left. Some say they have none. They don't have any real stores. They have a small fake store. They have some online presence. But they used to be the number one retail in the world. They were the Walmart before there was Walmart. You want to get to them. So, you have a buddy who knows someone, and you eventually get a meeting at Kmart.I'm going to read a short paragraph about this trip, which--there's something deeply romantic and beautiful about it. First, I'm going to set the stage a little bit. It's incredibly exciting. This is a dream come true. You have this funky product, which unlike me, you actually think is a great product. It's this ball of sawdust that grows hair. And you have a chance: It's the most important presentation of your life. It could change your life. It turns out it does. But you're 23; you don't know it, as you point out in the book.So, quote:The morning of the pitch, I had to wake up super early, at around 4:30 AM, to make the four-and-a-half-hour drive from Toronto to Kmart's corporate headquarters in Troy, Michigan, a suburb of Detroit. Even though I had a 9:00 AM appointment, it didn't occur to me to drive in and stay over the night before so I could show up fresh and well rested. These are the things you don't stop to think about when you're twenty-three. Plus we were trying to save as much money as possible so we could keep putting it into the business. So I just threw on a white button-down shirt and a pair of jeans, loaded a box of twenty-four Earth Buddies into my mom's red Toyota Celica, climbed behind the wheel, and headed out. The crazy thing is that I did absolutely nothing to prep for the meeting. I didn't do any prep with Anton [Russ: --which was your business partner--] and there was no PowerPointEndqoute.