The Flying Colors Foundation Oct08

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The Flying Colors Foundation

by M.A. Ngyuen

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Of all the controversies that have occurred in the anime community this year, none have been so forgotten as the Flying Colors Foundation. Appearing in March 2018, it quickly vanished leaving little to no trace of its existence outside of the fact that it was apparently a scam that several YouTubers were part of. So what was this mysterious foundation?

Humble Beginnings

Our story starts with an entrepreneur by the name of Francisco “Fran” Lee. Lee had served as an intern for Disneyland in Anaheim, California during his college years working at one of the park’s restaurants, which was an experience that he found not only enjoyable but impactful. So impactful that it prompted Lee to join the park’s Consumer Insights and Measurement Analysis team after graduating from college and stayed at the company until March 2018. Of his experiences at Disney. Lee said:

“I am able to create a better story and deliver a more complete analysis with the
data we collect since gaining valuable experience in my internship. I saw
firsthand how the park operates on a daily basis and what employees are doing
out in the field. It opened my eyes to how the data is collected and provides a
different viewpoint on raw numbers.”

Lee then joined LootCrate as their Brand Consumer Insight Strategist in October 2016. Primarily focusing on anime and video game franchises, he created 14 successful monthly surveys for the company’s product lines. His interest in anime would inspire Francisco to develop his own company called Otaku Pin Club with Daniel Suh and Brain Li. Specializing in selling unlicensed anime pins and merchandise, Otaku Pin Club began business dealings in February 2017, though it would not be officially registered until July 12, 2017.

On May 31, 2017, Otaku Pin Club’s Instagram announced that popular anime YouTuber Gigguk had joined them as their advisor. Gigguk recalls that this collaboration began after mentioning in his Discord server that he was considering merchandise of his channel when a Patron of his, who happened to be a member of the company, approached him about the emerging business. Out of appreciation for his endorsement, OPC produced a series of pins based on Gigguk that was released in October 2017.

During a meeting held at anime Expo 2017 between Gigguk and Otaku Pin Club regarding these collaborative pins, OPC offhandedly mentioned an idea for a not-for-profit company focused exclusively on the Western anime fanbase. The exact focus of the NPO and its business strategy had yet to be decided upon, but both parties agreed that this simple idea should be explored further, soon evolving into the Flying Colors Foundation.

A Curious Plan

The initial goal of this non-profit was to introduce a new model for anime production. Despite not being fully agreed upon, the founders promoted this potential goal anyway to garner support. With anime’s emerging popularity in the west and more series being produced than ever before, they feared that streaming services such as Netflix and Amazon would monopolize the streaming rights to anime shows as they expanded their anime streaming libraries, leading to a decline in the quality of future anime series in conjunction with limiting their availability.

Flying Colors additionally disliked the control that production committees had over anime production, feeling they pushed for too many anime series to be produced, most of which are unnecessary and are a component contributing to the grueling work conditions Japanese animators face daily. To combat these problems, the foundation offered a Sampo Yoshi-style model for anime production. Originating from Feudal Japan, the Sampo Yoshi business philosophy dictates that any transaction made must benefit these three parties: the buyer, the seller, and society. In Flying Colors’ case, this was the anime studios, the influencers, and the anime community.

FCF strived for anime studios to be contracted “under fair conditions” in conjunction with becoming independently funded. Flying Colors wanted studios to be so independent that they stated that studios affiliated with them would be able to retain their intellectual properties, or allow these studios to invest their earning towards complete independence. However, a PowerPoint press reel about FCF’s proposal also states that the foundation sought to acquire streaming licenses for themselves as one of their means to provide anime globally. Nevertheless, Flying Colors wanted this studio independence so that anime producers could have unlimited creative freedom on their projects.

The Influencers, which were anime YouTubers, were to “define the development of the anime industry’s future” by serving as marketers for new anime series with plans to have them become “leaders, producers, and investors” that could “transform fan resources into a non-profit production committee.” Finally, the Western community’s input would determine which anime series would get greenlit. If everything went as planned, this would culminate in the foundation attempting to acquire a loan from the Japanese government to support their cause.

Initial Actions

On August 6, 2017, Youtuber Joey the Anime Man announced the Top 100 Anime of All Time poll four days after previously covering the results of a similar poll conducted in Japan by NHK titled “Best 100 anime”. Striving to be the largest of its kind, Joey’s poll had a similar purpose to NHK’s, to find what fans considered the best anime series of all time. However, Joey’s focused on Western audiences rather than the Japanese.

While seemingly innocuous on the outside, Joey’s poll was secretly a data mining experiment for the newly formed Flying Colors Foundation. Introduced to the company by Gigguk, Joey’s poll was one of the foundation’s means of establishing themselves within the anime community. As neither Fran, Brian, nor Daniel had any experience working in the anime industry, they resorted to offering incentives to gain endorsement. These incentives would range from simply pledging to a YouTuber’s Patreon to “establishing more revenue streams, working on a publication, or producing [their] own content,” as FCF’s own Daniel Suh states in an email to The Canipa Effect.

Perhaps the most infamous example of this method was their consultation with Digibro at Crunchy Expo 2017 where not only was he paid $100 for it but was later offered merchandised t-shirts based on his channel and even a music deal. Why this method was utilized, according to Digibro, was because the record label 88rising, who one of FCF’s members was also a part of, found success with a similar strategy.

Digi asserts that when the foundation consulted him they did not present themselves as an NPO. Regardless, FCF would continue paying consultants and offering incentives while under the guise of being one, denying that influencers were receiving any money for their involvement and that influencer support and membership was purely voluntary. By late September, FCF had five confirmed influencers working for them: Gigguk, Glass Reflection, Digibro, Mother’s Basement, and Joey the Anime Man. Gigguk credits himself as introducing the foundation to several of these YouTubers.

On October 6, 2017, the results for the Top 100 anime of All Time poll were publicly released on a 12-page document on Issu.com. The poll was considered a success with a turnout of over 120,000 participants. In conjunction with its release, Joey the Anime Man uploaded a video overviewing the published results where he openly thanked Flying Colors for their collaboration with him as well as Gigguk for introducing him to the company.

The release of the poll’s results also saw the opening of Flying Colors website revealing new members/partners they had gained. These were professional basketball player Johnny O’Bryant III and his multimedia company Noir Caesar Entertainment; and academics Courtney “Nuka” Plante and Professor Stephen Reysen who are known for their research in fandom, particularly furries.

In the wake of the release of the results of the Top 100 poll, Digibro enthusiastically promoted Flying Colors on a podcast simply named “The Podcast” where he shared confidential details about the company’s plans with his fellow co-hosts. Three of the podcast’s co-hosts, anituber Kenji the Engi, My Anime List reviewer Rido, and Joe from the YouTube channel Pause and Select would go on to participate in a phone interview with Francisco Lee and Daniel Suh six days later on October 28, 2017.

After discussing his involvement with it on The Podcast, Digi would continue promoting the foundation by uploading a video about its goals the very next day. However, the publicity Digibro and Joey gave to FCF proved to be harmful as the company was still undergoing development with loosely set goals. As a result, Flying Colors minimized their public presence to the point it was even considered dead but continued to donate to the Patreons of Mother’s Basement and Canipa throughout November.

In the months-long silence, many became increasingly distrustful of Flying Colors. Suspicions had begun as early as September when Miles, public relations manager for Crunchyroll, questioned them over Twitter about their knowledge of the anime industry. These suspicions would worsen when Kenji the Engi, who initially liked the idea of the foundation, began publicly describing it as a scam utilizing methods such as surveys and email registrations to extract data from anime fans. Several even made comparisons between Flying Colors and OtakuCoin, a shady cryptocurrency made by Tokyo Otaku Mode that seeks to provide income for underpaid Japanese animators.

Change of Plans

On November 16, 2017, the Flying Colors Foundation officially registered as a non-profit organization. FCF had shifted their goals from changing the anime production model to solely collected the data of Western anime fans. This change had been brought about by their partners having an interest in the data they had acquired.

The organization soon reentered the public sphere on March 1, 2018, with a new press kit and a redesigned website. Their press kit reveals new members that had joined the foundation during their period of public absence. These were Patrick Stanley as the research director, Sydney Poniewaz as PR manager, and Daniel Lee, the analytics director. Its founders also had their own roles now with Franciso as Strategy and Insights, Daniel as the Finance Director, and Brain as the Creative Director. Anituber Akidearest, girlfriend of Joey, was their newest influencer and cultural anthropologist Ian Condry, known for his studies on Japanese culture, was their latest advisor in addition to their Board Director.

The press kit guarantees that any proceeds made to the foundation would be given back to these three NPOs: Hyun’s Dojo, an online community for aspiring artists, Anime For Humanity, which focuses on the improvement of health and well-being in the anime community, and the Animator’s Dormitory, who seeks to support start-up Japanese animators by providing them dormitories and had been an affiliate of FCF since September. The end of the press kit closes on the announcement that the foundation would officially open on March 15, 2018, launching with a new poll titled the 2018 Anime Census that aimed to rival the Top 100 Anime Poll in size. The company believed that they could use the results of this census to convince anime studios into partnering with them to help these studios target overseas fans better.

Controversy

Forbes would cover the release of the census in an online article describing the foundation’s members as “a staff of six anime fans, several of whom have day jobs in anime-related fields when they’re not working on the nonprofit.” But this coverage would only further escalate the worsening reception of the foundation.

Canipa, who had now disavowed FCF since February, quickly contacted the author of the Forbes article publicly over Twitter telling her that FCF’s influencers were being paid to support it, citing Gigguk’s previous collaboration with Otaku Pin Club which was also managed by the founders. Richardson H. Kilis of My Anime List then supplemented this conversation by posting registration documents for the two companies proving that they were indeed connected.

In response to the recent accusations made against them, the Forbes article updated the same day of its release to include a statement from the Flying Colors Foundation that said:

“We would like to clarify that any financial proceeds generated by the census data, whether through consulting services or research projects commissioned by organizations in the anime industry to Flying Colors Foundation, will be donated to charities and community organizations that promote anime. Flying Colors Foundation does not benefit from, nor keep profits. All data will be collected anonymously, and insights from the data will be published as free reports for the public.”

Another suspicion arose that the foundation was planning on selling data collected from the census to advertisers after Francisco Lee’s LinkedIn, which displayed his career at LootCrate, was discovered. In response to this accusation, Flying Colors bizarrely stated that Lee had quit working at LootCrate the previous month to work full-time in the foundation, contradicting their own press kit and Fran’s own LinkedIn that states his involvement in the company was voluntary.

The census itself was subject to sharp criticism regarding its questions, such as one asking if the participant would be interested in joining their research panel. But the most discussed and heavily criticized was a series of questions asking if the participant had a history of mental illnesses and if anime had an effect on their overall personal well-being.

Six days later Joey the Anime Man uploaded a video promoting the census that was commissioned by the foundation. In this now deleted video, Joey openly admits to having direct involvement with FCF and urges his fans to participate in their census to “make a change” to the anime industry. Joey assured viewers in the video’s comment section that the accusations against Flying Colors were no more than false rumors with “baseless reasonings” and that the census was a “passion project” with “nobody on the team, including [himself], getting money from this. It is 100% voluntary.”

Freelance writer Alicia Haddick, known in online circles as Socialanigirl, published an article about the growing controversy surrounding the Flying Colors Foundation on March 23, 2018. Compiling all the allegations that had been brought forth against the company, Socialanigirl additionally questioned the number of employees in the non-profit, noting how press releases strangely omitted board director Ian Condry by stating that there were a total of six members in the foundation.

The next day, Gigguk issued his own statement about the controversy on Twitter to simply “give a perspective from [his] end”. Though he had refrained from commenting on the controversy, Gigguk claimed that he was compelled to clarify his connection to FCF after the spread of what he considered “wrong assumptions, misinformation, and straight up lies.”

Summarizing his history with them, Gigguk assured readers that the foundation had “no mal-intent or anything of the sort with anyone involved big or small” and that its founders were just “some passionate and driven anime fans” that have long since divested themselves from Otaku Pin Club. He then posted his defense to Reddit where he additionally revealed that the company’s press kit had an unusual error. Sydney Poniewz, his girlfriend, was surprisingly not the PR Manager nor was she in control of the Twitter account for Flying Colors with her overall involvement actually being minimal.

Meanwhile, Socialanigirl’s article quickly garnered attention culminating in a response from the organization themselves. In this response, Flying Colors bafflingly affirmed that Ian Condry was merely an affiliate of them and not a member despite his positions in the company because, according to them, he “does not engage in the day to day operations [of the foundation].” After restating Gigguk’s claim about the founders being no longer apart of Otaku Pin Club, the response letter then stated that the purpose of Flying Colors is to “[contribute] to the pool of knowledge with information that would be difficult for industry organizations to gather or share.”

As for the data collected from the census, it is said to be for use in creating what they describe as “open source research papers available to the public” and ” to help partners find insights about the anime community.” Finally, Flying Colors assured that they “[do] not track, collect, or keep any online data about participants apart from their voluntary responses to our surveys” nor do they “track IP addresses or any information that could be tied with personal identities.” In conjunction with this response, the foundation secretly deleted tweets from their conversation with Miles of Crunchyroll that were featured prominently in Socialanigirl’s article.

Escalation

After an interview set with the foundation itself was “canceled at the last minute,” Socialanigirl released another article about the Flying Colors Foundation on March 27, 2018, titled “The Concealment and Lies Behind the Flying Colors Foundation: Further Revelations”. Containing a timeline of the foundation’s history up in till the time of the article’s publication, this lengthy article notably revealed details about hidden members within the company citing a recording of the October 28, 2017 phone interview as evidence.

From the recording, FCF had several members on the board of directors that included Beth Kawasaki and Mutsumi Miyasaki, who interestingly work at LootCrate, and an academic referred to as Professor Earl known to have taught entrepreneurship at the USC Arts Centre. In addition to mentioning Courtney ‘Nuka’ Plante’s and Professor Stephen Reysen’s involvement, another board of director located in Japan whose identity remains unknown is mentioned in the article, though it is suggested that this may have potentially been Kawasaki.

Another hidden member was a woman by the name of Esther Kwan involved in the company’s business development with the task of working closely with FCF’s partners and promoting it across college campuses. Kwan was working unpaid, which while corresponding with what the foundation had previously claimed about its members, her role was frequently interchangeable. According to her LinkedIn, she was officially employed as an intern but is referred to by various terms such as volunteer in the October interview.

The article then proceeds to unveil that, contrary to what FCF had previously stated about tracking Census participants, the software typeform that the anime Census ran on states in its privacy policy that it collects the IPs of individual users using third-party tracking services. More alarming was the foundation’s lack of a privacy policy of its own that violated several laws. These being the California Business and Provisions code sections 22575-22579, the Children’s Online Privacy Protection Act of 1998, and the California Online Privacy Protection Act.

Socialanigirl then called into question the founders’ alleged divestment from Otaku Pin Club stating that Francisco Lee and Daniel Suh were still involved in the for-profit company while working with Joey on the Top 100 anime Poll and the fact that both men remained as administrators of the OPC community Discord server as of March 26, 2018. Finally, the article concludes with the reveal that Digibro had been paid for his consultation with the foundation.

Admitting that he was unaware of the details revealed in the latest expose, Gigguk maintained on Reddit that his involvement with Otaku Pin Club ended upon joining FCF, even though his pin series was released while he was a member, nor were there any plans to link the two companies together.

Downfall

On March 28, 2018, the Flying Colors Foundation announced that it would be officially closing on March 31st after feeling that “personal identification information of their team” had been leaked online that resulted in “threats to [their] personal safety and harassment of [their] members.” They promised that the results of the anime Census would be published before their closure, but they would delete the data that had been collected from it afterward. Gigguk proceeded to delete his defense of the company stating on Twitter, “In light of recent events I have deleted my previous statement about FCF. For now, I will be waiting on the sidelines to see what happens and will halt any involvement until further notice.” Concurrently Joey’s video about the anime Census also became mysteriously unavailable.

That same day Socialanigirl would release yet another article about the controversy. Revealing that the founders had intentions to create FCF pins sold through Otaku Pin Club and that they wanted to share data from the foundation with the cryptocurrency OtakuCoin, the pinnacle of the article was the extent of Joey’s and Gigguk’s involvement within the organization.

Form an anonymous source that was in the foundation itself, Joey had become more involved in the foundation in January, searching and pitching the foundation to Japanese companies, some of which were his contacts. There were even plans for Joey to be involved with the planned Japan office mentioned in the March 2018 press kit. Gigguk is suggested to have had a deeper involvement within the company, citing a screenshot of private Twitter conversations between him and a censored party as evidence.

Gigguk responded critically to the latest exposé on Reddit, believing it had been written with libel against him and Joey. He accused the author of incorrectly portraying his involvement as deceptive and that though FCF did consider a partnership with OtakuCoin, this never occurred due to it being advised against. Acknowledging that the company had been severely mismanaged, Gigguk assured that his support for them was out of genuinely wanting to see their plans achieved rather than to intentionally scam people.

Socialanigirl then replied to his Reddit comment with several screenshots to support her stance. The first was of Francisco Lee conversing with someone over Discord about planning to work with OtakuCoin and the other an Asana page for the company. This Asana showed Joey in BizDev as well as a member suspiciously similar to Gigguk named “G(” with the role of contacting the Influencer team like how he had mentioned in the leaked Twitter conversations.

 

 

The rest were allegedly corroborated Skype messages taken from a Skype group for Flying Colors that showed that Gigguk had posted his recently deleted defense of the foundation to this group as if he were awaiting approval to release it. Among the other screenshots taken from the Skype Group was of Daniel Suh posting what appear to be drafts of FCF’s response to scoialanigirl and Gigguk posting Canipa’s Twitter thread about OtakuCoin seemingly during a Skype call.

Gigguk dismissed these allegations by maintaining that FCF never met with OtakuCoin; believing that the tweet he had posted in the Skype group not only proved nothing but was regarding Canipa, mentioning in the thread a planned video critical of Flying Colors. As for Fran’s statement over Discord about OtakuCoin, he claimed that it was made prior to the plan being advised against.

He denied that he was ever a part of the Asana, merely seeing the screenshot as proof that there were talks between FCF and Joey, nor did he see posting his defense to the Skype group as damming evidence, saying:

“They turned to us for how to manage all the heat, and we helped. My message
as you can see is a one-way message with no edits or comments made by the
other side, this was because it was my personal statement, of which I was
making them aware of what I was sending.”

Gigguk concluded his comment by revealing that from talks with the founders of the now-defunct company socialanigirl’s anonymous source was none other than a moderator of r/anime, the very subreddit he was posting in, suspicious as to why this important detail was omitted from the article.

With his cover blown, faux_wizard came forward as the moderator in question supporting the claims made in the article. His reasons for joining the foundation was to get in contact with the Animator’s Dormitory to do a Reddit AMA and, in Faux’s own words, “to reach out to youtubers/content creators to create at least some sort of communication channel between me/them in order to iron out r/anime rulings and minimize drama.”

Spending a total of three months in the foundation, Faux describes the foundation as having horrendous communication issues. He recalls that he was never briefed beyond the surface level about the number of people involved nor did he know their positions within the company outside of roles that were assigned arbitrarily. Faux describes his relationship with the founders as a strained one, stating:

“All Daniel and Fran would do was join a call once a fortnight, repeat mostly the
same things as the week before, attempt to stroke my ego (like hearing that
you’re of great assistance is great and all the first two times, but I honestly got
really sick of it after the 9th or so time) and then never act on any of the input I
gave. In fact, I’m convinced they were actively spreading misinformation on my
behalf (notably to the influencers who I wanted to get in contact with for
/r/anime purposes, mainly just so we could have a chat/iron out some of the
differences content creators and the subreddit moderators had in the past, but
they couldn’t even do that properly).”

Instead, Suh and Lee requested that Faux make alterations to two of r/anime’s surveys and to pitch Flying Colors to AMA-related contacts, notably anime studios, but Faux assures that he never fulfilled these requests. Overall, he felt that he was morally obligated to leak details about the organization for the sake of the community.

Amidst the confusion that had arisen in the comment section, Gigguk announced that he would finally refrain from commenting on the Flying Colors Foundation from now on, believing the controversy had descended into what he felt was “gossip territory.” Socialanigirl attempted during and after her argument with Gigguk to speak with him in private with a third person, but he declined each time fearing that she would falsify information about the conversation. A few days later, her Medium account which contained the articles about the Flying Colors controversy was deleted, but she soon reposted them on her WordPress blog on April 14.

Epilogue

So what happened to Flying Colors’ key figures after its demise? Daniel Suh and Francisco Lee have vanished in the wake of the closure of their company. Lee has deleted his Facebook page, the only confirmed social media he had. Brian Li, arguably the most silent of the founders, continues maintaining a YouTube channel shared with his girlfriend that focuses on Vlogs and Kpop.

Otaku Pin Club remains operational, but it is apparent that since Fran and Suh’s absence their social media presence has stagnated with their last post on Twitter being March 22, 2018, the day before the release of Socialanigirl’s first article on the Flying Colors Foundation. All traces of OPC’s highly publicized Gigguk line have been erased entirely, not even being featured in the section of their website dedicated to retired products. The banner ad for the Youtuber’s line was later restored sometime in September 2018, but redirects to the company’s latest products.

Despite distancing himself from the failed non-profit, his time as an influencer as clearly affected Gigguk. He has begun to refer to himself as an “anime Digital Influencer” on his business cards. Joey has since released a sequel to the Top 100 anime of All Time Poll called the Top 100 Manga of All Time, but it has received only a fraction of the popularity its predecessor had. It is unknown at this time if Joey is working with a hidden party for the Manga Poll.

Digibro released a video discussing his involvement in the foundation on April 1, 2018, a day after it officially closed. Considering his involvement as tangential at best, Digi admits to having lost touch with FCF after 2017. He was so ill-informed that he says he was unaware of the controversy and its importance when the foundation contacted him about it. Perhaps the most intriguing detail Digi provides in the video is his description of one of the organization’s members:

“…and the other one [involved in the company] was a fucking weapons dealer
for the US government or something.”

The identity of this “weapons dealer” remains uncertain.

Mother’s Basement spoke out about his involvement during the controversy but provided very little information about it outside of the fact that he says that the foundation ceased donating to him after asking him if he wanted to go beyond paid consultations. Glass Reflection, on the other hand, acted surprised when Canipa revealed that Otaku Pin Club was a side-company to FCF and may not of known what was going on behind the scenes.

RodgerCraigSmith2004, who was a part of the October 2017 phone interview, elaborated on his experience with the company after its closure saying:

“They didn’t have a lawyer, they didn’t seem to know how to brand themselves
as there were a lot of misunderstandings in regards to what exactly they were
trying to accomplish in the first place, and I’ve mentioned this multiple times
before, but they were reluctant to give away a simple business email. Now I
would have given them the benefit of doubt had it just been, say, an off night.
But then when we all came to an agreement that they’d change the website to
specify what they are and what they aren’t, they didn’t end up following through
on it.
[…]
Now I’m not the smartest person around, nor do I believe I’m the dumbest
around, but I assume that if I initially don’t completely get what the company
was doing, then other folks won’t get it either. And that’s pretty much what
happened since they constantly had to apologize for misunderstandings. “

The rest of the members involved with Flying Colors have remained silent.

The results of the 2018 anime Census were never released. Nevertheless, the data collected by the census would have been useless as the information gathered from its target audience can be accessed elsewhere. Interestingly, several similarly themed surveys would appear months after the closure of FCF.

One such survey was conducted by Crunchyroll weeks after Flying Colors shut down that had a suspiciously similar goal to the anime Census. Running for only a week, Crunchyroll guaranteed that the results of this survey would be released to the public through various means, this has yet to occur.

On June 14, 2018, Anime News Network released a paid survey by an organization called the “anime Fan Research Group” which asked participants what their favorite anime was. The survey stated that upon completion participants would automatically be entered into a raffle for a chance to win “10x Amazon gift card with a face value of 100$ each,” the dollar sign incorrectly placed behind the number.

In reality, the “Anime Fan Research Group” was the pseudonym of a company who was using this survey for marketing research. The company was kept anonymous by ANN’s CEO, so anonymous that even ANN’s staff did not know who they were. The reason for this anonymity was either out of fear that their true identity would affect the results of the survey or that it would alert their competitors that such research was being conducted.

In conclusion, the Flying Colors Foundation was the flawed idea of an anime loving venture capitalist who wanted to support and improve the industry anyway he could that failed due to a combination of mismanagement, lack of legal knowledge, and blatant lies. Nearly forgotten by the public, all that it has brought is damage to the reputations of the people that took part in it.

LINKS:

[Dropbox with Powerpoints and PDF materials provided by the author. ]