Entertaining show this week….only one of the entrepreneurs scored an investment from the Sharks, but there were several lessons-learned provided by the other three entrepreneurs. The winner of tonite’s Sharky Award is……
Al from De-boned Baby Back Rib Steaks…..Al “Bubba” Baker had a 13 year NFL career before entering the food industry. Al has solved a real-world problem for people who think eating ribs is too messy. He figured out a way to cook the ribs, then de-bone them, and then package them to be sold in stores. After purchase, the ribs can be microwaved for two minutes and are ready to eat with a knife and fork.
What made his pitch so compelling is that Al had been awarded two patents for his product and his process. This type of protection is very unusual for food products and will allow Al’s products to be licensed to larger food companies without fear of pirating his ideas and know-how. Al did a deal from Shark Daymond. I have a funny feeling this could be a run-away hit.
Shark Chum…….Alexander and Marley from Spirithoods had sold over $9 million of their funny, furry hoods but their sales had decreased this past year. No investor likes to invest in a company with decreasing sales….especially when a nice annual profit turns into a significant annual loss. If they do invest, it is usually at a valuation 50%-90% less than the entrepreneur’s “ask”.
Jan from Virtuix valued his company at $20 million based on raising $1.1 million on the Kickstarter crowd-funding website. In return Jan had to “give away” 3,000 of his virtual reality units. His valuation was very high given his track record (very few real sales). Also, Mark Cuban thought there was a good chance Jan’s technology would be obsolete within five years.
Joselyn and Kelly from Fohawx had created some very cute bicycle helmets for their kids. It took me quite awhile to learn how to spell and pronounce the name of their company, and I’m still not sure I have it right (maybe Fauxhawks?). This is never a good thing from branding standpoint. A company and product name should be simple, easy to spell, and easy to remember.
Being from Bayonne,NJ (near my old stomping grounds) Joselyn and Kelly were very spirited, but took more hits during their presentation than the “Bayonne Bleeder”, Chuck Wepner…..the legendary Bayonne heavyweight boxer who somehow lasted 15 rounds with Muhammad Ali (Chuck even knocked him down once!).
Mark Cuban uncorked a knock-out punch of his own when he told the ladies, “You’re selling us on the dream and not on the green”. Ouch!