| 15.1°C Dublin

Mysterious life of the man who gave birth to the Beanie Baby

When it was announced that Beanie Baby soft toys will be discontinued on December 31, obsessed collectors resorted to demonstrations, divorce and murder. Its creator is now the richest toymaker in the world and one of America's most secretive tycoons. Giles Austin investigates the mysterious man behind this extraordinary phenomenon

The road to riches heads west out of Chicago along Interstate 88, and you reach the end of the rainbow 20 miles away in an urban wasteland of strip malls, second-hand car lots and fast-food joints. Here, above a four-storey black marble lobby of palm trees and waterfalls, 453 employees toil behind the white concrete and curved mirror windows of a new office block in probably the most profitable small business in the world.

This is Beanie Baby land, the home of Ty Inc, mysterious no-address, unlisted-phone-number headquarters of those cuddly, floppy creatures that are suddenly in the headlines again. MI5 is less secretive about its home than Ty Warner, the president, chief executive officer and lock, stock and patents owner of everything Beanie.

Warner, 55, is the Howard Hughes of the toy world; secretive, a shrewd manipulator and peerless marketing man who, in the information age, knows the selling-power of being elusive. In six short years he has converted an idea so simple that everyone asks "Why didn't I think of that?" into a company with a net annual profit of $700 million (£437.5 million) and a personal fortune of $7 billion. He has just landed high up in Forbes magazine's list of the 400 richest Americans. Yet for three years hardly anyone has seen this Scarlet Pimpernel of soft toys. For two years Ty Inc did not even answer its phone. Warner never does business face to face, leaving it to in-house lawyers. He flies off to sort out production in China and Korea. No one appears ever to have seen his "no comment" press officer Anne Nickels.

Warner achieved this smoke-and-mirrors miracle by making Beanies such as Quackers the Duck, Chilly the Polar Bear and Waddle the Penguin - small so they don't take up too much room, soft so they can be moulded to any shape, inexpensive so children can buy them, and scarce. By "retiring" limited editions unexpectedly, he ensured that they soon became collector's items fetching up to £8,000 apiece. Now things are coming to a head. The news that rocked Beanie world came at 3.30pm on August 31. In a terse statement on his Ty.com website, Warner announced that come the Millennium, all Beanie Babies will be retired. They will finish at the stroke of midnight on December 31, with a black bear Beanie Baby named The End.

No one believes it. Who in their right mind would dump a $700-million-a-year cash cow? But the announcement has led to riots, demonstrations, divorce and murder. West Virginia security guard Jeffrey White, 23, was accused last month of forcing his 60-year-old colleague, Harry Simmons, to kneel, then shooting him terrorist-style in the back of the head because he failed to pay up for some Beanie Babies.

In a nation of school and office massacres, Beanie HQ now has an armed policeman on permanent duty in the lobby to add to the security of anonymity.

In 1993 Ty Warner was tramping the streets of Hinsdale, the nearest thing you find to a twee village in these parts. He carried a suitcase full of cute little toys he had just designed and which he hoped might catch on, and looked in most days at Page's restaurant on East Hinsdale Avenue for a cheeseburger and fries.

In the case were Beanie Babies. Warner had just introduced the first nine of the floppy creatures at a toy fair, but there was little interest. He kept pushing them throughout 1994. Then in 1995 they suddenly became all the rage for collectors. Children (and parents) queued and fought for them. Mums scoured the Internet for Beanies to make up collections.

In May 1996 an amazed and more talkative Warner told the Chicago Tribune: "I have been in the toy industry for 30 years, yet this is a real shocker to me." Schools in Illinois and Florida banned Beanie Babies because children taking in their Top 20 favourites disrupted classes. Warner said: "We filled three 747s from Korea and China with tens of thousands of Beanie Babies to get them here for Easter."

Daily Digest Newsletter

Get ahead of the day with the morning headlines at 7.30am and Fionnán Sheahan's exclusive take on the day's news every afternoon, with our free daily newsletter.

This field is required

H. Ty Warner was the elder child of Harold Warner, a jewellery and toy salesman, and his pianist wife, Georgia. His younger sister, Joyce, is 51. His parents went through a bitter divorce and Harold died of a heart attack in 1983. Georgia described as an elegant woman who still wears long gloves like those worn by film stars of old lives in an apartment that her son bought her in a gated enclave two miles from his own surprisingly modest home.

Warner grew up in the middle-class Chicago suburb of La Grange and went to Michigan's Kalamazoo College, where he played endless bridge. He dropped out after a year and, tall, dark and good-looking, went to Hollywood to become a movie star. Instead he spent a year as a petrol station attendant, a grocery clerk and a door-to-door camera salesman.

Realising that he would never be Robert Redford, he returned to Chicago to join his father as a salesman for Dakin, a San Francisco giant of the teddy-bear world. He stayed there for 18 years and became a flamboyant super-salesman. Wearing a long fur coat and top hat, and carrying a cane, he made sales calls in a white Rolls-Royce Silver Shadow.

Paul Roche, his former supervisor, says "he was probably the best salesman I ever met". Before he went coy on the world with his mystery tycoon gambit, Warner told Joni Blackman, the author of Beanie Mania II: "It was all to get in to see the buyer. I figured that if I was eccentric-looking in Indiana, people would think `what is he selling? Let's look in his case'. I wanted people to pay attention to what I had, then it was easy to sell."

Warner left Dakin in 1980 and wandered around Italy for three years, playing tennis and eating spaghetti. When his father died, leaving him $50,000, he returned to Chicago and set up in toys on his own. He designed a floppy white Himalayan cat called Angel. It sold well, but wasn't the blockbuster that Warner craved.

Then he realised that there was nothing for children in the $5 range and designed Beanie Babies, which changed his life. He said: "At first everyone called them roadkill and told me I was cheap, that I hadn't stuffed them enough. They didn't get it. The whole idea was that they looked real because they were soft and moved."

Ty Inc expanded fast: from a spare room in Warner's Hinsdale apartment into a small office-warehouse unit at neighbouring Westmont and, two years ago, across the road into the swish new offices with no name or number, and an anonymous warehouse 10 miles away in Bolingbrook, where unmarked lorries drop their precious loads from China.

Warner, unmarried but now with his long-time girlfriend, Faith McGowan, 42, a divorced former lighting-shop employee, and her daughters, Lauren, 15, and Jenna, 14, also moved into a modern, white, million-dollar house on an "IBM executive" estate two miles from the office. It is modest for a man whose name is spoken in the same breath as Gates, Getty and Rockefeller.

In July Warner paid $8 million for an 8,000sq ft Mediterranean-style house in California, and in March, looking for somewhere to stay in New York, he forked out $275 million to buy one of America's most expensive and snooty hotels, The Four Seasons. He paid in cash.

An accomplished classical pianist and tennis fanatic, he unwinds by listening to the Rolling Stones.

Despite the secrecy, Warner also appears hungry for recognition and status in the business world. Last April he was miffed when reports called his company "small but nimble". He had already declared, in a full-page letter taken out as an ad in The Wall Street Journal, that he was the world's top-selling toymaker last Christmas, but few believed him.

So he lifted the veil of secrecy a little, handing correspondence between himself and his accountants, Ernst & Young, to the New York Post. It proved that he is the richest toymaker in the world, with net profits in 1998 of $700 million - well above the combined $538 million of the "big two", Hasbro and Mattel.

Warner is a generous boss. Last year's Christmas bonus was a year's salary. He has also created several limited-edition Beanie Babies exclusively for employees. Anyone lucky enough to have the full collection of 264 is sitting on about £50,000. As a result, few people leave the company and they never give away secrets about their boss.

Can it all last? Before Warner, Russ Berrie was the cuddly toy king. In 1991 and 1992, sales of his trolls soared from $44 million to $250 million. Then, he says: "On April 12, 1993, at 1.42pm, every person in the US stopped buying trolls. Ty is doing a terrific job but at some point the bubble will burst."

Meanwhile, Warner definitely has something up his sleeve. When Forbes magazine told him that he was in its top 400, he said: "Our name brand will not go away. We want to be the Coke of collectibles."

Most Watched