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Posted: March 31, 2011

CEBA winner: Kazoo & Co.

Diana Nelson's having fun

Mike Taylor

Diana Nelson bought Kazoo & Co. in 1998 with a loan from the Small Business Administration, and the single mother of two has pushed the Denver business well beyond its Cherry Creek North brick-and-mortar confines.

A year after acquiring the store, Nelson recognized the potential of online sales and launched kazootoys.com. In 2007 she landed an agreement with the Army & Air Force Exchange Service to be the U.S. military's exclusive online toy retailer. And then in 2008 she launched a licensing division and sold a franchise location at Denver International Airport, which Nelson says is thriving.

As for her Ethics in Business award, Nelson, 54, says, "We wouldn't be around this long if we weren't an ethical company. I'm a pretty old-fashioned person. You still can do a business deal on a handshake. I think when you meet with people and you tell them you're going to do something, you do it."

Nelson employs about 30 people at the 13,000-
square-foot store, many of whom have been with the company more than a decade. Others have spent their high school years working at the store, gone off to college and come back to work at Kazoo & Toys over the summer. Some have become full-timers.

"People stay with us for a long time, which I think says a lot about the attitude of the business," Nelson says. "It's very family-oriented. And being a single mom with two teenage boys myself ... I mean, they've grown up in the toy store."

Sandy Vechazone, the company's operations manager who has worked at the store for 12 years, nominated Nelson for the ethics award.

"She's probably the smartest businesswoman I know," Vechazone says. "She's gotten to where she is not only because she is smart, but I also consider her a very ethical person, a very fair person. She's very well respected not only in this community but in the toy industry in general. People call her from stores in other states for her opinion. If you go to New York to the Toy Fair, she's very well known."

Nelson says Kazoo & Co. has weathered economic downturns and low-cost competitors like Wal-Mart by offering unique toys the big-box retailers don't stock, including dozens of stuffed animal species - polar bears, crocodiles, walruses, platypuses and more.

"Something you're not going to find anywhere else," says Nelson, who was invited to China last year to help one of her green-toy manufacturers plan its 2011 offerings of toys made from bamboo.

Given her constant research on toy trends, it only makes sense to ask Nelson what toys will be hot in 2011.

"You know what's really coming back? Magic kits!" she says. "You know, the old magic-trick hats with the bunny coming out of the hat, and the red table with 40 magic tricks in it, and the disappearing wands and all that. They're really hot this year."

It's not surprising that Nelson finds her work fun. And, she says, "I like watching other people have so much fun doing what they do."
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Mike Taylor is the managing editor of ColoradoBiz. He writes about small-business money issues and how startups are launched. Email him at mtaylor@cobizmag.com.

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