Endless Santa: Netflix Of Toys

Every parent knows toddlers have short attention spans, especially when it comes to toys: they quickly tire of what they just got and want new stuff. But who can afford that? One entrepreneurial Houston mother of 15-month-old twins has a solution: BabyPlays, which applies a Netflix rental model to educational playthings aimed at the diaper set.

Lori Pope pulled some $250,000 out of the oilfield supply business she already owns to launch the Web start-up last fall. With a warehouse of 6,000 toys, BabyPlays.com offers various membership plans that allow parents to rent toys as long as they want, and then send them back for different toys. At $37 a month, the cheapest plan allows families to keep four toys at a time. The most expensive plan is $65 a month for 10 toys.

Pope shops for playthings she thinks are safe, stimulating and sturdy. She sterilizes and shrink-wraps each toy before sending it out. Her business plan calls for 12,000 toys by summer and profitability in 18 months, but she plans to sell the company in a few years. By then, her own twins—the perfect test marketers—will probably want an iPod rather than a stuffed Fluffy.