Discovery Zone

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Discovery Zone
Traded as DZ
Industry Fast food and entertainment
Fate Bankruptcy
Founded October 1989; 28 years ago (1989-10)
Kansas City, Missouri, U.S.
Founder Ronald Matsch
Jim Jorgensen
Dr. David Schoenstadt
Defunct 1999 (1999)
Headquarters Wilmington, Delaware, U.S.
Area served
Products Family entertainment centers

Discovery Zone (DZ) was a chain of entertainment facilities featuring games and elaborate indoor mazes designed for young children, including roller slides, climbing play structures and ball pits. It also featured arcade games. The chain was founded by Ronald Matsch, Jim Jorgensen and Dr. David Schoenstadt in 1989. The first location was opened in Kansas City, Missouri in October 1989. An early investor and vocal supporter of the company was tennis player Billie Jean King.[1]


Discovery Zone grew quickly opening 15 stores in 18 months.[2] In April 1993, Blockbuster Video invested $10.3 million into Discovery Zone to purchase 21% of the company. And then in June 1993, Discovery Zone raised $55 million more when it went public on NASDAQ.[3] The stock rose 61% in the first day of trading.[3]

Under the leadership of then CEO Don Flynn, in July 1994, Discovery Zone bought 45 Leaps and Bounds stores from McDonald's for $111 million in stock and 57 franchised stores from Blockbuster Video for $91 million in stock bringing the total stores to almost 300. At the same time, Blockbuster bought more shares of Discovery Zone giving it 50.1% of the stock.[4]

Blockbuster Video, now a subsidiary of Viacom Inc., took total management control of Discovery Zone in April 1995.[5]

Stretched thin by expansion, changes in management tried to save the company; however, Discovery Zone filed for Chapter 11 bankruptcy protection on March 26, 1996 in Wilmington, Delaware with debts of up to $366.8 million.[6]

On June 30, 1999, Elmsford, New York-based Discovery Zone Inc. abruptly closed half of their 'Fun Centers' and were unable to alert those with reserved parties.[7] 13 locations were sold to CEC Entertainment Inc, owner of Chuck E. Cheese's, who attempted to accommodate last minute party reschedulings over the following days.[7]


  1. ^ Anderson, Susan Heller (January 23, 1991). "Chronicle". New York Times. Retrieved April 28, 2012. 
  2. ^ "Discovery Zone". 
  3. ^ a b "DISCOVERY ZONE SHARES RISE 61.4% IN FIRST-DAY TRADING". New York Times. June 5, 1993. 
  4. ^ "McDonalds To Unite Play Unit With Discovery Zone". Chicago Tribune. July 19, 1994. 
  5. ^ "VIACOM'S BLOCKBUSTER UNIT TO RUN DISCOVERY ZONE". New York Times. April 18, 1995. 
  6. ^ Mills, Joshua (March 31, 1996). "Diary". New York Times. Retrieved April 28, 2012. 
  7. ^ a b "Discovery Zones out". CNN. 

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