Tom Donaldson has a pretty black-and-white mandate at a company known for its colorful plastic bricks: ensuring that the LEGO Group’s business remains relevant over the decade ahead, as new technologies emerge and trends come and go.
Donaldson is Head of the Creative Play Lab at the LEGO Group, the Denmark-based toy company, founded in 1932. At our Impact 2025 conference last month, he talked about the company’s culture; his belief in the importance of prototyping and “silent demos”; and how the company measures innovation. One important metric for new products: kids “have to be telling their friends about it and jumping up and down,” Donaldson says.
Below is a lightly-edited transcript. For more insights from Donaldson, check out the videos we recorded with him in advance of Impact.
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You arrived at LEGO in 2016. You had been VP of R&D at Jawbone, the consumer electronics company. What is it like to parachute into LEGO with its culture? It’s such an amazing brand; so many people relate to it. But what is it like to show up as an executive at the company?
It was a big learning journey, if I’m really honest… I’d been in the tech industry, and the tech industry thinks a certain way. You can kind of feel how innovation in the tech industry works, and I really wanted to see a different way of working. Some of it is that Northern European bias. Some of it is the purpose of the brand, some of the fanaticism with the consumers. And some of it is because in toys, there’s no right answer. There’s no optimizing. You’re not making the perfect toy; you’re just making great toys. So it was a really exciting journey. Being part of a company where we are very diverse as individuals with experience, but there’s a really shared vision and mission — and that everybody is at the company because they believe in what they’re doing, and not just to make a buck. It’s quite remarkable. And it took me several years to really internalize how special that is.
How do they talk about the mission at the LEGO Group? Is there a mission statement that’s up on the wall?
The mission statement is very simple. It’s to inspire the builders of tomorrow. It’s a really straightforward statement. And yet, it’s incredibly powerful. For many people, their first LEGO set made them want to be an engineer… We have these moments that are not just inspiration in a small way. They’re inspiration in terms of unlocking personal potential… The vast majority of people who work for the LEGO Group also are there because they want to inspire a generation…
Did you have a personal connection to the brand, through your kids or your own childhood?
Dirty secret: I was not a LEGO builder when I was a kid. I was a Meccano guy, and one of the few people that [have] come into the brand…[who] didn’t always want to work for the company from the age of six or seven. …I think that was a benefit, because in every company, you have to worry about drinking the Kool-Aid if you want to keep innovation going, and really question, are we continuing to meet our aspirations?
Tell us about the Creative Play Lab — how long has it been around, and how does it sit within the innovation and product development universe at LEGO?
I report in to our Chief Product and Marketing Officer, Julia Golden, so I’m a peer, and I work very closely with all of the folks that are involved in our wider portfolio — our head of design, head of marketing, but also the folks who lead the product group. So I have a say in the overall portfolio, but my primary role is to look a little bit further out, to look at the next generation of consumers, to ensure that the LEGO brand, the LEGO brick, the LEGO business remains relevant for five or ten years ahead.
So it is a slightly separate unit. Over time, I’ve also picked up the technological imperative, so I am responsible for all of the engineering that is in our products, not just at the R&D phase, but all the way through to launch, and in fact, life after launch as well. And so that makes it a little bit of an unusual organization in that we’re not just a front end. We’re not just early innovation, throw it over the fence, cross your fingers, and blame somebody else when it goes wrong — or get the blame when it goes wrong. We carry it all the way through… and that gives it both a blue sky, but also a quite concrete flavor.
Are there reasons that it’s located in London, instead of Billund, Denmark at company headquarters?
It is also located in Billund. I have a distributed team. The largest group of them are in Billund at the headquarters. I have a team in London. Growing a team here in Boston. We’re up to 16… I also have some folks in Singapore as well.
Give us a little bit of a high-level perspective on what is changing about the toy business in 2025 — the way that parents buy toys, the way that kids learn about toys?
The great thing about kids is, you can’t predict them.
Obviously, we’re all looking at where AI is going, [and] what AI is going to introduce onto the landscape. I think a lot of people are fearful for what that means for kids. I’m actually quite optimistic…
Of course, gaming has been a very big influence. Minecraft, Roblox, and Fortnite, have been very big influences. Of course, IPs have been very big influences, whether it’s Bluey at the younger age or Marvel at the higher ages. I think we are beginning to see a move back a little bit towards physical. And that’s certainly something that I personally believe in. I do see that maybe the gaming steam is just beginning to run out a little, in terms of deeply engaging kids and giving them something fresh. Obviously, we’re all looking at where AI is going, [and] what AI is going to introduce onto the landscape. I think a lot of people are fearful for what that means for kids. I’m actually quite optimistic [about] what it could mean for kids…
What does your optimism come from?
I think at the heart, there’s two things that AI can do in an incredible way for kids. One is learning. You’re connected to the entire body of human knowledge, and it can be personalized to where you are at in whatever learning journey that you are on. I also think it can be incredibly creative. Today, kids have a beautiful idea in their minds, but they sketch it on a piece of paper and they’re a little bit disappointed about the manifestation of that idea. That tends to pop the bubble, or be a downward spiral of imagination. Because unless you have the skills to bring your imagination to life, it can be a struggle, and not all kids come out the other end of that struggle.
I think the opportunity for AI is if we make it easier to translate imagination into reality — imagination is a loop. You make something and think, that was cool. Now, what do I do? That was cool? Now, what do? And I think when that works well, we can get into a world where we are really stimulating kids’ imaginations, because they can manifest and react. I don’t know that we’re there yet, but it’s certainly where my optimism comes from.
We had a bit of a conversation at breakfast about the importance of prototyping new ideas, and you said you constantly have to harangue people [about that.] “Hey, don’t pitch the concept, don’t pitch the deck. Actually build me something.” How do you do it? What does it look like?
It varies. …An idea is just something that leads you to make a prototype. The thing you need to do is have an experience. And ideally, you need to have an experience that’s different than what you thought it was going to be. You pick something up, you make it, and you think, “Oh, hang on, that doesn’t feel so good.” Why doesn’t it feel good? What’s the gap between what I imagined and what the reality is? That’s the creative space, in that gap.
I just banned PowerPoint, and I banned talking of any form.
We can spend a lot of time having ideas. Something I introduced when I first joined the Creative Play Lab was silent demos. …A lot of people would spend their time in a demo explaining what you were supposed to feel, or what the purpose was of the demo, rather than getting hands-on and feeling what it felt like. And so I just banned PowerPoint, and I banned talking of any form.
So you hand somebody the prototype and you say, “This is my thing.”
You’re not even allowed to say, “This is my thing.” It’s completely silent. The people playing with it can give you feedback, but then they’re reacting to the thing, not to the idea. It takes quite a lot to get incredibly talented designers to just let go enough that they can listen to not their design intent, but the design execution and how it feels for the end consumer.
I want to ask one follow-up. When you’re prototyping at the Creative Play Lab, are there things you’re commonly using? Are you using clay, foam, LEGO bricks, 3D printing?
Lot of Lego bricks, and then everything else is ad hoc. …We do have laser cutters, we do have 3D printers, we do have spray booths. But we quite like this idea of the one hour / one day / one week prototype. The first prototype should be up and running in an hour, and you’re allowed to “fake-o-type.” You’re allowed to use Post-it notes that are pretending to be screens. You’re allowed to put a magnet under the table that’s pretending to be a motor. You just have to create some sense of suspension of disbelief in the audience, such that your response is realistic.
Magic has to work in low-fi.
I think people can get really into, “Oh, you got to have these big machines to prototype.” I have this phrase that… I really believe in, which is “the magic works in lo-fi.” If the film is only brilliant when it’s 3D animated, it’s not a good film. Pixar know this. They draw all their films in charcoal, right? And they decide if it’s a good story well before they [3D animate it.] For me, it’s the same thing. If there’s magic there, the magic will come out just in the interplay of two really, really rough prototypes working together. And if you have to put the layers on, then maybe it’s not such a good idea.
So, “magic only works in lo-fi” is the statement?
Yeah. Or at least, magic has to work in low-fi.
Love it. From an audience member: It seems like LEGO’s innovation has been more about leveraging adjacent brands for new products, and not launching entirely new products. Is that a fair and accurate characterization?
I think it’s both fair and unfair. We’ve done some significant things in gaming, which is a reasonably different category. We’ve certainly tried in augmented reality. LEGO Hidden Side was one of the first things that I worked on…
What was that called?
LEGO Hidden Side. It was an augmented reality experience… So it’s fair, because at the end of the day, we do base our business on the LEGO brick. So we have chosen not to be a portfolio business where anything that’s cool you can do. We’ve said, “No, at the heart of our business is this reusable system, and we want to figure out what you can do with that.” I think we’ve taken it in some really exciting areas. LEGO art is one of my favorite. LEGO botanicals, the flowers we’ve started to do — you could argue that those were quite significant new product categories. We’re appealing to very different consumers — in the main adult women, with the botanicals. You could argue that the build is very different. You could argue that the way you use the product display, and as a present is very different. But you could also argue, “Oh, it’s still made of those underlying plastic brick elements, the LEGO brick, so it’s the same.” So I think it’s a little bit fair, but I also think it’s a little bit unfair.
And I would point out, like there always have been these experiments. LEGO worked with the MIT Media Lab to create this toy called Mindstorms, which was on the market for quite a while, kind of robotic programming plus LEGOs. There was a LEGO-plus-mobile app product called “Life of George” for a while. So it does feel like there have been experiments of varying degrees of success [around], “Let’s launch a different type of product that is not a box of bricks.”
LEGO Super Mario was our collaboration with Nintendo Corporation, and that was an electronic-based product, and that was one of our best-selling products of all time, at least in the first year or so. I think there have been some good examples. But…we don’t feel the need to be a business that’s forever [a] 100% growth business. That’s not the ambition, necessarily. The ambition is to bring creativity to kids, and to bring worthwhile products that enhance the life in this idea of kind of systematic creativity. And we stay true to that. Sometimes it gives us opportunities to go broader than we are, and sometimes it means that we don’t follow things that other companies might.
There is [an audience] question about sustainability, microplastics, circularity. How does that get thought about and discussed within the LEGO Group?
A huge amount. For many, many years — even since before I joined — we’ve been making some very large investments into alternatives to plastics. We have recently replaced the plastic bags that you have in sets with paper bags. We are increasingly moving our feedstock to be gradually incorporating more and more recycled feedstock. So the recycledness of each brick is going up, year-on-year. We see ourselves as playing a key role, even though we’re not the biggest consumer of plastics in the world, of helping fund that cycle of investment into alternatives. Because the reality is, there’s no off-the-shelf alternative.
We also believe in circularity. We have been piloting what we call LEGO Replay, where you can take your bricks back and they get recycled. That’s not as easy as it sounds. …The reality is we need to, you know, do that in a way that’s sustainable, otherwise it winds up being self-defeating.
Now that everybody’s seen this video [of the new US headquarters in Boston] and they want to work for the LEGO Group, are you hiring? Who are you hiring for in 2025?
We’re hiring broadly in my own group. We are growing the Creative Play Lab, primarily in the engineering function at the moment. We’re doing some really exciting engineering work — but sorry, I can’t tell you about that right at the minute. But we’re really pushing our ambition in how to bring advanced technology into toys in some interesting ways. AI I mentioned, but there’s other ways as well. And so we are hiring in my group [for] advanced engineering capabilities.
It does sound like it’s a somewhat secretive company — maybe not as secretive as Apple — but you’re interviewing people and you’re saying, “We’d love to have you work here, but we can’t exactly tell you what you’ll be working on?”
I have been doing that. A lot of people have taken the leap. And luckily, when they’ve come on board, they’ve said, “Wow, I knew you were doing something, but it’s even more ambitious than I guessed.” But yes, a lot of people have been very brave to trust the brand…
How would you take the LEGO method of innovation back to Jawbone, the tech company you worked at, or any other company? Are there some things that would be applicable? What would need to change?
It’s a wonderful question…. I think team dynamics is one of the things that I’ve really experienced as most different. In a North American startup culture, they can tend to be a little bit rockstar-focused. Whereas I think, in the LEGO Group, we really spend time on “it’s the team,” and how you think about team behaviors. We still have incredible numbers of talented people. But the way we think carefully about how you put them together, and how you really build collaboration that goes beyond just the capabilities of those individuals… How you think about culture is something I would take wherever I go next, because I think the reality is great teams are way more than the sum of the individuals in the teams. My experience in a much more limited way the tech industry is perhaps it tends to push more towards those individuals that are perceived as being the 10x individuals. And I think there’s a lot to be said for collaboration.
Audience member: I think a lot of us here are faced with a broad charge for innovation. I know personally, we have a huge portfolio of core, all the way to transformational stuff. And I think we often face challenges around build, buy, or partner. How do we get new business models… How do you do that at LEGO? Because you’ve done so much, whether it’s gaming or the robotics you mentioned, or even the LEGO store experience? Do you do go outside of LEGO? Or do you build those capabilities internally?
We build those internally. We have our own advertising agency. We partner through our own agency to some external agencies, but we’re very internally-focused. We’re very vertically integrated as a company. We have our own manufacturing… So it is very internal. It’s also very collaborative. So I was talking about our silent demos. Even in the early days of some silent demos, I’ll be inviting in manufacturing colleagues and product safety colleagues, you know, the people that are normally killing ideas before they’re off the ground. Because if you give input at the early stage that, “Oh, you know, if you do that, that’s going to be a product safety issue,” the designers can work with it…
You need to bring the right folks in, and you need to bring them in in a way where it’s clearly…we want to hear from you [about] problems we need to solve. But we also understand that not everybody is experienced at seeing early-stage ideas and making judgments about whether they’re good or bad… I think the collaborative and end-to-end model is super important.
The other thing is, if people are a little bit, “Meh, yeah, it’s a nice idea,” just drop it. This is particularly transformational things… All of our businesses probably can make another few points of growth by doing the same [thing], right? The opportunity cost of introducing something transformative — it has to be way bigger than just one more product line, because it’s way riskier. You have to have a small number of ideas that truly light people up, even if they say, “Yeah, but it’s impossible.” More generally, I think the filter is people not process. We want individuals to be passionate about what they’re doing, and individual leaders to be passionate about supporting that. I think that’s where a lot of the secret sauce comes from at The LEGO Group.
Can you talk about the efforts to bring forward adult LEGO kits?
This is a really fascinating area. There have been adult fans of the LEGO brand and the LEGO brick for many, many years. We tended to see those as you know, a niche…fan audience that we really supported with LEGO Ideas, which is our website where you can suggest opportunities and other types of events for those adult fans of LEGOs. But what we what we realized after a period of time was that that was just scratching the surface — that there were a lot of adults buying toys that we had designed for kids, because they just really loved the building experience… We actually did an Indiegogo [crowd funding campaign] in my group. We did what was called LEGO Forma, which was a flexible fish, and it was an Indiegogo $250,000 crowdfunding campaign just to explore, is there a there there for adults? We worked out very quickly that there was a there there. Then my colleagues really picked that up and ran with it. It was a little bit helped by COVID, because we really saw adult fans buying into LEGO products through COVID, and from there, we’ve been able to be a little bit more deliberate about it.
You made a great point about not all evaluators being qualified to assess an early-stage idea. How do you share that feedback and prepare the organization for the right type of governance. And probably the subtext here is also, keep people out of the process if they are not the right evaluator for an early-stage idea?
[You need to be] very clear about the difference between an input giver and an evaluator. We really want people to provide input — to say, “I like that. I don’t like that.” And in particular, actionable input, like, “That’s going to be hard to manufacture. Just want you to know about it.” Or, “That’s going to be very hard to persuade the retailers,” or whatever it happens to be. The reality is we sometimes think that innovation is one lone genius, but the reality is a large number of independent ideas, corralled together make for a really, really strong idea.
But the governance piece is a little bit different, and ultimately that comes down to a small group of folks, myself included, who make the decisions on what we go forward [with.] And I’m quite happy telling my my boss, “I’m not listening to you on this one.” …I go in to bat for the ideas, not just my own, but my team’s ideas that I believe in. That can be rough and tumble sometimes…
There are governance structures, but they’re relatively light, and [our approach is more about] trusting the people who we’ve given the job of having that judgment, to apply that judgment.
Our outcome is growth, and primarily it’s growth of audience, rather than growth of revenue.
Are there some metrics that you and the Creative Play Lab continually think about, and are trying to deliver against? Is it more of an outcome expectation?
It’s an outcome expectation. …Our outcome is growth, and primarily it’s growth of audience, rather than growth of revenue. Broadly speaking, we believe that if you produce high-quality products that kids absolutely love, then the revenue will probably follow. If the kids hate it, at some point that’s an unsustainable place to be. So we are ultimately driven by our predictions of the growth of the business and in particular, the growth of the audience.
We do some risk-weighted prediction — you know, just because the kids love it when it’s a very early idea doesn’t mean that’s the same as a mature idea that’s loved to the same extent. So you have to slightly balance that. But ultimately, we’re very focused on the mission of inspiring the builders of tomorrow. And we know that inspiring kids doesn’t mean, “Yeah, okay, it’s kind of nice.” They have to be telling their friends about it and jumping up and down. And that’s kind of the metric: Are the kids jumping up and down?
The very last question I’d love to touch on is just consistency, persistence, and longevity of being committed to innovation. …It’s such an exception to the rule in large companies. I’d love to hear your take, if you have a way to inspire this audience, to say it can happen in other companies, not just the LEGOs, the Disneys, the Nikes of the world?
I think it has to happen in other companies. Every company is a big company because someone in its journey has been a Disney, right — has created something with lasting and sustainable power. I think companies that forget that — they can last for a long period of time, but they’re just lasting. I do think that it comes down to people… I see a lot of CEOs saying, “We must have an innovation group. Let’s find some people to staff an innovation group” — rather than we must have innovators.
I think that is the message: lean into the people that bring the passion, bring the ideas, bring the new thinking… If you’re leaning into the processes, or you’re leaning into the organizational structures, that’s necessary, but not sufficient.
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