At a Glance: Sideshow Collectibles
§ Location: Westlake Village, CA.
§ Line of business: Maker of action figures and collectibles based on movie and TV characters
§ Challenge: Financing growth, including increasing licensing, enhancing facilities and hiring new employees
§ Merrill Lynch solutions: Commercial Line of Credit, 401(k) plan
Sideshow Inc., (Westlake Village, CA) is a vibrant player in the exciting world of action figures and collectibles from movies and TV. Their horizons are widening further, with help from Merrill Lynch. Sideshow started in 1993 as a creator of makeup effects, props and animatronic puppets for movie studios. The effects business was up and down, explained Greg Anzalone, CEO and president, but another field was opening up. In 1994, Sideshow began to design and develop toy lines for dozens of companies with hundreds of new products.
Anzalone reconceived the creative focus in 1999 by establishing the Sideshow Toy brand. Sideshow quickly achieved star status in the field of high-quality collectible figures. With its talented artists, sculptors, designers and craftspeople, Sideshow regularly releases a broad range of high-quality figures, many based on familiar movie and TV characters from James Bond, The Simpsons, Star Trek and others. Sideshow also has its own lines of historical figures from the American Civil War, World War I and the Old West.
Finding a financial partner
Besides posable action figures with plastic bodies and fabric clothing, Sideshow's artists produce polystone collectibles. These are highly detailed cold-cast figures, hand-painted to museum-quality standards. These product lines have catapulted Sideshow to the front ranks of quality collectible manufacturers. After rave reviews, the company was ready to expand. A revolving line of credit would give them the flexibility to buy additional theatrical licenses from major studios for higher-profile movie figure collectibles. "We invited our bankers to our facility for a tour to show them exactly what we're creating. While we've done millions of dollars in business with our bank, the end result was that they just didn't get it," Anzalone said.
"We interviewed a half-dozen other banks," he added, "explaining what we do in several ways. Nobody truly got it. The problem is," Anzalone explained, "we're in a very creative business, a nontraditional enterprise that bankers do not see with regularity. While our bank does have a theatrical division and they're used to dealing with film studios, they still have the attitude of a traditional bank, and we present a different image to them. Ours is a unique business that not many others are in."
Sideshow wouldn't settle for the sidelines, however. Their CPA recommended they contact Merrill Lynch Wealth Management Advisor Tino Pagano of the Campbell-Pagano Group (Costa Mesa, CA). "Tino and his group came in and listened to us. We showed them exactly what we showed the bankers, and they looked at the business outside the box. Right away, Tino and his people appreciated who we are. They were very receptive and responsive," Anzalone said.
The need to finance expansion
With a line of credit from Merrill Lynch Business Financial Services Inc., Sideshow has been able to increase its licensing with studios, enhance facilities and hire new employees. The line of credit was more than doubled after the first six months and was increased again in 2003. Pagano and Financial Advisor John Dahl recently helped the company set up a 401(k) plan as well. "We've only been able to grow with support from the people at Merrill Lynch, who've stayed with us," Anzalone explained.
Sideshow embarked on an ambitious joint venture with the award-winning effects facility Weta Workshop, Ltd. of New Zealand. They produced an amazing line of collectibles from The Lord of the Rings film trilogy. Polystone figures, busts, miniature helmets and wall plaques were all created in association with the artisans who created the actual props, weapons, make-up effects and creatures for the films. Anzalone credits Sideshow's success to the superb quality of its figures, which can be seen on its Web site, www.sideshowtoy.com. "But it's the people – our employees are among the most talented artisans in the country. We're a very cohesive group." Anzalone added, "We're thrilled that Merrill Lynch recognized the uniqueness of our products and our people."
The client's testimony is his own experience and may not represent that of others. It is not indicative of future performance or success.
The Working Capital Management Account® is a product of Merrill Lynch, Pierce, Fenner & Smith Incorporated, which is a registered broker-dealer, not a bank, and the WCMA account is not a bank account. Banking services are provided by licensed banks or by third parties through licensed banks. The WCMA Line of Credit, which is linked to the Working Capital Management Account, is offered along with other financing through Merrill Lynch Business Financial Services Inc., 222 North LaSalle Street, 17th Floor, Chicago, IL 60601 – California Loans made pursuant to a Department of Corporations California Finance Lenders License. Programs, options and property types are not available in all states and are subject to change. Certain conditions, restrictions and costs may apply.