There were three mini-deals made on this episode of Shark Tank….each company had a valuation of $500K or less. The investments ranged from $100K to $160K.
It’s difficult to pick a Sharky Award winner from this group. Although each had a nice business, none of them were far enough along to show that they will become successful over the long-term.
In terms of their presentations, they were all excellent! Even Cameron from Off the Cob (who didn’t get an investment from the Sharks) did a great job, and he stands as good a chance as any of them to succeed.
The Sharks invest in a business for many reasons. Obviously, one is to make money with as little risk as possible! In the case of the Sharks, one of the other important considerations is to invest in companies where they “don’t have to do a lot of work”. This means the entrepreneur has not only created the product, but has sourced it for manufacturing, has made initial sales, has a distribution strategy, etc.
A quick rundown of this episode’s entrepreneurs……..
Ryan and David from Kitchen Safe has created time-lock containers that help people resist eating goodies and help them lose weight. Mr. Wonderful actually made Ryan cry by criticizing his product. Despite that issue (crying is never a good strategy), and considering their product cost too much to make, it was a miracle they got a $100K investment from Lori and Nick (the CEO of GoPro).
Sharon from Magic Cook has created a self-heating food container system that is amazing! Her target market is campers and survivalists. Daymond invested $100K for 33% equity. (Mr. Wonderful added, “Camping Sucks”….what a surprise).
Tom from Earthlog makes fire logs out of recycled materials. He got a $160K investment from Lori who plans on getting Tom on QVC ASAP. Tom’s differentiator is his logs generate more heat with less smoke than the competition.
Cameron from Off the Cob didn’t get a deal for his sweet corn tortilla chip enterprise. He only had sales of $45,000. The Sharks didn’t invest because he was “too early” to seek 3rd party funding. In other words, the Sharks would have to do too much work to help him get to the next level.
Update: TipsyElves, a Sharky Award winner from 2013, will have sales next year of $8 million selling their ugly Christmas sweaters (their sales were less than $900K when they appeared on Shark Tank). One of their keys to success was diversifying into sweaters for other holidays such as the 4th of July. This has helped smooth their production and has significantly increased their sales.