Opening a Lego set can feel equal parts overwhelming and exciting. With numerous bricks and tiny details laced into each element found in a box, the eagerness to build brick castles, rocket ships, city skylines, and more has attracted kids in droves for 92 years.

Few companies have been able to replicate Lego’s success thus far. Its toys span generations, from adult hobbyists reconnecting with their favorite toys to the next generation.

Since its humble beginnings in 1932 as no more than a carpenter’s passion project, Lego toys have become an indispensable part of childhood. Name the topic, and there’s likely a set for it, whether architecture, anime, racing, or jazz music.  

Over the decades, Lego could very well have been replaced by more addictive and appealing electronic gadgets. But that wasn’t the case—if anything, things couldn’t have been better for the family-owned Danish company. It reported record results in 2024, with a 12% sales growth against the toy market’s 1% decline. 

What, then, is Lego’s secret sauce to keep kids (and, more recently, adults) hooked to its colorful bricks? 

Fortune takes an exclusive look behind the scenes of Lego’s product development and the secret to keeping the iconic brand relevant.

One of Lego’s long-standing themes—space—illustrates what makes its approach unique and helps it stand the test of time. Space was one of the company’s three official categories within which it developed toys (“castle” and “city” were the others) dating back to the 1970s. It was meant to represent the mysteries of the future, much like castles did for the past. Space’s popularity with kids has endured through the years as it has captured kids’ imaginations as a realm of endless opportunities.

“Lego-building is a passion in its own right,” Julia Goldin, Lego’s chief product and marketing officer, told Fortune in an interview last year.

Listening to kids, for kids

Lego realized early on that there was no proxy to understanding what kids want without hearing from them directly. Goldin said the company made this deliberate decision about 10 years ago, and it’s helped the company change how it pursued toy-making. 

“What makes a Lego set unique is, first and foremost, really understanding the audience,” Goldin. “Not just understanding what will be of interest for them, but what are the right dynamics of the experience.” 

The quality of Lego’s bricks is another factor that sets it apart, as sets can get passed from one generation to the next, according to Frédérique Tutt, global toy industry advisor at market research firm Circana. Unlike mindless games, parents think their kids could gain something good from Lego toys, whether that’s engineering abilities or using their creativity. 

“When parents buy Lego for their child, they think it’s going to help them build their brain,” Tutt told Fortune. “They [Lego] try to develop products for anyone and everyone.”

Turning an idea into reality

As a long-time toy maker, Lego has developed a well-oiled machine to help it constantly generate new ideas. The company does a “boost week” once a year—think of it like a rapid brainstorming session typically associated with startups that spur new concepts. Designers come up with fresh ideas or work on existing ones, giving them creative freedom outside their day-to-day schedules. There isn’t a checklist of what needs to be achieved, although the goal is to see what can be turned into a potential Lego set, said Daniel Meehan, one of the brick company’s creative leads. 

The next step is to figure out how “decodable” the models are, including finding elements that tell stories and make them easier to play with, like Lego astronauts or purple collectible crystals.   

In addition to milking ideas from the company’s designated toy developers, the company hears directly from its audience. 

“We play-test stuff as well with kids extensively,” Meehan said. 

The company brings kids together across the world, from Germany to China, to see what they want more of. That process yielded one of the critical elements we see in Lego’s space-themed sets today, said Meehan, who is spearheading the company’s recent space campaign. 

During one of its space “DIY tests,” one of the kids was flying around a vehicle with wheels, collecting aliens along the way—both of which weren’t part of the initial set’s design. 

“We’re very practical, we’re adults … but in the eyes of kids, it was a perfect space flying vehicle. But there was one complaint: he [the kid] said we need more aliens. And we actually did put more aliens in the box as a result of that one kid,” Meehan said.  

The addition of aliens to Lego sets, such as in a Lego space station, adds more layers to what would otherwise be a straightforward set and also marks a common thread that ties sets from other categories together. For instance, Lego aliens can also be found in the space science lab and rover sets. The little green creatures were deliberately designed to look alike as a cue to Lego builders, Meehan tells Fortune.

Lego’s quality and complexity can make its products expensive—sometimes pricier than the latest iPhone. That’s especially true of products pulled out of the market, making them rare. The novelty of its products has made them a collector’s dream and even the object of $100,000 heists in the U.S. The company says it offers sets across different price points so no one feels priced out. Its most simplified products can cost single-digit dollars, just as its 7,500-piece Millennium Falcon set could cost about $960.      

For the love of detail

To be sure, Lego’s care for quality and detail isn’t a new phenomenon. The company’s founder, Ole Kirk Kristiansen, imbibed it strictly to his son, who once tried using two instead of three coats of paint to hasten an order and was reprimanded. 

The company’s penchant for detail applies not just to its space creations or toy development process but also to its business. Goldin, for instance, straddles meetings that look at the company’s present performance while also discussing the pipeline for the next few years.     

So much of the Danish company’s legacy as a toy maker is linked to how it makes play accessible across age groups, interests, and experience levels. The theme of space, Meehan explains, can be aimed at three types of audiences: storytellers, who are mostly kids with a fascination for the subject; enthusiasts, who have an interest in learning about the field; and others, who are generally drawn to all things space, including its artistic side.

“Another strength they have is they appeal to the young children as well as the teenagers or adults with intricate pieces. So, they grow with you,” Tutt said. 

The granular approach also applies to how Lego prices products and designs, and markets sets for its up-and-coming adult fanbase, ensuring there’s a toy for everyone. But one thing is sure: irrespective of the motivations, the company tries not to dial down on details because that gives Lego toys their character. 

Goldin says Lego fans “really notice” the little elements it adds, as they “bring a lot of excitement.”

“It’s much more than a toy because it’s a very immersive experience,” she said.

A version of this story was originally published on Fortune.com on Aug. 25, 2024.

This story was originally featured on Fortune.com

Australian foreign minister Penny Wong urged universities to seek greater research cooperation with partners outside the US following the Trump administration’s threat of funding cuts to the sector. 

At least seven Australian universities are facing a potential reduction in funding after they received lengthy questionnaires from the U.S. government asking how their projects aligned with President Donald Trump’s domestic and foreign policy priorities. Industry group Universities Australia said the change could affect as much as A$600 million ($377 million) in research funding.

Wong said that just as the Australian government was encouraging businesses to broaden their trade markets in response to global disruptions, the education industry needed to follow suit.

“We have to recognize that we live in a different world,” she told Australian Broadcasting Corp. radio on Wednesday. “We will continue to make the case to the U.S. that collaborative research benefits both countries, but I would say making sure we diversify our engagement matters across all our economic sectors.”

Australia, one of Washington’s oldest allies which also runs a trade deficit with the U.S., is bracing for the next round of tariffs due to be unveiled by the Trump administration within 24 hours. Prime Minister Anthony Albanese has said he will not negotiate on a range of concerns raised by the US Trade Representative in a report released this week.

Universities Australia chief executive officer Luke Sheehy told the ABC last week that Monash University and the University of Technology Sydney were among those exposed to potential US funding cuts. 

“This is really alarming that Australia’s closest ally, someone who funds more than half a billion dollars of research in the Australian system seeking Australian expertise to benefit both countries, is putting all of that at risk,” he said.

This story was originally featured on Fortune.com

Source link

The first days of the second Trump administration offered the newly elected president a chance to share the spotlight with some of his most important allies. While some of the featured leaders were ones you’d expect—cabinet nominees, congressional leaders, megadonor Elon Musk—at least one was a surprise: Masayoshi Son, the Japanese billionaire tech investor.

The occasion for Son’s star turn in the White House Roosevelt Room on Jan. 21 was an announcement that SoftBank Group, Son’s Tokyo-based conglomerate, would put up most of the funding for Stargate, an ambitious partnership with OpenAI and Oracle that aims to turbocharge American leadership in artificial intelligence. Flanked by Oracle chairman Larry Ellison and OpenAI CEO Sam Altman, and standing on a box to be seen above the lectern, Son promised Trump that Stargate would invest a staggering $500 billion to build a nationwide network of data centers, power plants, and research centers. Trump lavished praise on “my friend Masa” for bankrolling “the largest AI infrastructure by far in history.”

“This the beginning of a golden age for America,” Son told Trump. “We wouldn’t have decided [to invest] unless you won.”

It’s also a golden age for gambling on AI, and Son seems determined to be the table’s highest roller. SoftBank is leading a funding round of $40 billion for OpenAI, valuing it at $260 billion, in what could be a record single round for a private company. If finalized, that investment would position SoftBank as OpenAI’s largest shareholder. Meanwhile, SoftBank and OpenAI are launching a joint venture to develop and market AI in Japan.

(On March 31, after this story was originally published, SoftBank said it had agreed to lead a funding round of up to $40 billion in OpenAI Global, a for-profit subsidiary of the ChatGPT maker, valuing the company at $300 billion, in what could be a record single round for a private company. SoftBank plans to invest up to $30 billion in the subsidiary, with a syndicate of co-investors providing the remaining $10 billion.)

The surge is all the more striking because in some circles Son is best know for his failures. Indeed, the last time Son loomed so large in global headlines was in 2022, when his Vision Fund posted a $27 billion loss and teetered on the brink of collapse. Among its most spectacular debacles: office-sharing startup WeWork, for which the fund was forced to write down $14 billion.

But the comeback is vintage Son. Over the years, he has made and lost larger fortunes than perhaps any investor in the history of capitalism. From his early days as a scrappy software distributor, Son has demonstrated a flair for grand gestures, an unshakable faith in charismatic young founders with big ideas—and the capacity to bounce back from failed bets. It’s not far fetched to compare him to a daruma, a traditional Japanese doll that’s a symbol of perseverance. Daruma dolls have heavy, weighted bases; like America’s Weebles, they wobble but don’t fall down.

The wobble-and-rebound pattern has recurred throughout Son’s career—and each boom-and-bust cycle has seemed to leave his financial base more solid. SoftBank’s first big success was a bet on Yahoo, darling of the dotcom boom, which cemented Son’s reputation as a venture visionary and made him, briefly, the world’s richest man. Then Yahoo made a string of strategic errors, the boom went bust, and SoftBank’s market capitalization plummeted from more than $180 billion to $2.5 billion, a decline of 98%.

Son clawed his way back thanks to a $20 million investment, made just a month before the dotcom crash, that gave SoftBank a 34% stake in a then obscure Chinese e-commerce startup, Alibaba. Son famously claims to have decided to invest based on pure gut instinct after a six-minute meeting with founder Jack Ma. “It was the look in his eye, it was ‘animal smell,’” he recalled years later.

At its peak in 2020, SoftBank’s Alibaba stake was worth more than $200 billion, enabling SoftBank to borrow money for investments in hundreds of other ventures. In Japan, the company pioneered the expansion of high-speed internet and broadband, just in time to serve one of the world’s most tech-savvy younger generations. In 2006 SoftBank acquired Vodafone Japan, later rebranding it as SoftBank Mobile, a game-changing move that effectively put Son in control of one of Japan’s top telecom providers. That success paved the way for SoftBank to buy a majority stake in Sprint, which Son later merged with T-Mobile, creating the third-largest U.S. mobile carrier.

Son’s luck seemed to run out after 2017 when he launched the $100 billion Vision Fund, the world’s largest tech investment fund, with major backing from Saudi Arabia and the United Arab Emirates. The fund’s myriad wipeout losses eventually forced Son to unload many of SoftBank’s assets, including the bulk of its stake in Alibaba.

But if Son is unnerved by these gyrations, he has rarely shown it. He lives in a lavish mansion in Tokyo’s pricey Azabu Juban neighborhood, and in 2019, even as SoftBank’s fortunes were straining under the weight of WeWork’s failed IPO, he took out a personal loan from SoftBank to pay $117 million—then the most ever paid for a U.S. residential property—to acquire a sprawling European-style villa in Woodside, in the hills above Silicon Valley.

When it suits him, Son, who displays samurai swords and armor from his personal collection in his office atop SoftBank’s Tokyo headquarters, can be as intimidating as any feudal warlord. Anthony Tan, cofounder of Southeast Asian super app Grab, remembers being summoned to Tokyo for a meeting with Son in 2014. After an hour, Son cut to the chase: He was making Tan an offer he shouldn’t refuse. “You take my money, good for me, good for you,” Tan recalls Son saying. “You don’t take my money, not so good for you.” (Tan took the money.)

Uber CEO Dara Khosrowshahi has offered a succinct explanation for why tech CEOs have made countless 11-hour flights from San Francisco to Tokyo to meet with Son: “Rather than having their capital cannon facing me, I’d rather have their capital cannon facing behind me.”

Son’s cannon may have misfired at Vision Fund. But what enabled him to reload is the success of another singular investment: British chip designer Arm Holdings, which SoftBank took private in 2016. Since September 2023, when SoftBank listed Arm on the Nasdaq, its market cap has soared to nearly $120 billion, enabling SoftBank to pledge some of its 90% stake as collateral to take on debt.

SoftBank will need that new ammunition. For Stargate, SoftBank has pledged to provide $19 billion of the initial $52 billion in funding commitments for the venture in exchange for a 40% stake. In mid-March, it splashed out $6.5 billion to buy Ampere Computing, a U.S. chip designer focused on AI compute. Softbank’s overall AI spending commitments far exceed the $31 billion in cash it had on its balance sheet at the end of last year. The Information reports that SoftBank is in talks with bankers to borrow $16 billion to invest, in addition to $18.5 billion it recently arranged to borrow, secured by its Arm stake.

The larger question looming over the Stargate bet is whether it will be worth the returns. On Jan. 27, only six days after the White House ceremony, global investors woke up to reports that DeepSeek, a little-known startup based in Hangzhou, China, had developed an AI model that performs as well as or better than OpenAI’s leading model but requires far less memory and guzzles far less electricity. DeepSeek said it developed the model for less than $6 million, a fraction of the billions Big Tech companies say they are spending on their models.

The “DeepSeek shock” challenged prevailing assumptions about the correlation between how AI models perform and how much they cost. But much of the tech community sees those doubts as a distraction from a bigger truth—that growing demand for AI will create a voracious need for power and hardware, even if AI models themselves become more efficient. Altman has argued in a paper on the OpenAI website that “infrastructure is destiny.”

Clearly, the huge estimates of what it will cost to build that infrastructure don’t scare Son. “Some people say, after the DeepSeek syndrome, ‘Oh, you are overspending,’” he said shrugging at a February appearance with Altman at a SoftBank conference in Tokyo. “‘You know, you can save so much more by spending less.’ But I think you are looking at it the wrong way…How much of global GDP will be replaced by something a billion times smarter?”

Son estimates that within a decade, AI-driven solutions will replace at least 5% of global GDP, and potentially as much as 10%: “You shouldn’t be scared of spending a few trillion dollars if it returns $9 to $18 trillion per year. Why should you try to be efficient? For what? I don’t get it.”

At the same event, Son reminisced about past meetings with Altman. In 2017, Altman came to Tokyo looking for funding, but Son sent him away empty-handed. Two years later, as OpenAI developed one of the world’s most sophisticated AI models, Son offered to invest $1 billion in the venture. This time Altman refused.

Onstage, Son had a rosier recollection of the 2019 encounter: “You said that you’re going to go for AGI [artificial general intelligence]. I immediately said, ‘I believe you. I want to invest.’ From there I was a believer. I never doubted. Most people at that time thought you were crazy, right?”

“Some people think you’re crazy too,” Altman replied. “It all works out.”

This article appears in the April/May 2025 issue of Fortune with the headline “The nine lives of Masayoshi Son.”

A gambler at tech’s highest-stakes tables

This story was originally featured on Fortune.com