Highly entertaining Shark Tank episode this week! Highlights included a guy nicknamed “The White Rhino” who dead-lifted 600 pounds, and Mr. Wonderful who baby sat a contestant’s kid while she made her pitch.
As far as entrepreneurial “lessons learned”, there were some very creative deals reached. I’ve always said, when it comes to financing, you’re only limited by your imagination (and risk tolerance).
First into the Tank was the aforementioned Stan “The White Rhino” from The Kooler. After his 200 pound one-hand dumbbell press got the Shark’s attention, Stan showed off his “cooler within a cooler”. Since the addressable market is small (mostly bodybuilders), and Stan has to get involved personally with every sale, there wasn’t much interest from the Sharks. Stan ended up getting a small deal with Shark Daymond for $50K for 33% equity in his company.
Elizabeth from Little Nomad made attractive play mats for kids. Because of her high price point (over $100 for six), the Sharks thought there was a limited market for her product. Despite booking $114K in orders in her first three months, Elizabeth had not shipped a single product to customers. She was way too early for an investment from the Sharks. At least Mr. Wonderful made a few bucks babysitting her kid.
Chris and Eric from RinseKit generated lots of interest in their Pressurized Portable Shower product. It’s ideal for cleaning off things (and people) when no conventional shower is available. Sales are projected to be $2.1 million this year and $5 million next year. If it wasn’t for their debt level coming into the tank ($550K) and their lackluster presentation, I would have given them a Sharky Award, but they did get the Best Deal of the Episode when Daymond offered $250K for 7 1/2% equity plus his own sales commissions on everything he sells. Full disclosure…..Shark Lori had offered a similar hybrid deal and Daymond “stole” her deal structure and got the deal.
This deal was brilliant! Chris and Eric came into the tank asking for $250K for 5% equity and they didn’t want to take on additional debt. Now 5% equity isn’t enough to get any Shark excited, but add in a commission of 5-10%, and the $250K can get paid back quickly and still leave Daymond with a nice equity stake with increasing value. This was a true win-win.
Richard from DBest Products was a real hustler. He claimed his Smart Carts would sell $7-8 million next year. He had been in business 15 years and he had created a number of clever products that took advantage of California’s law that forbids stores to use plastic bags. Shark Robert bowed out early when Richard’s frenetic presentation pace got to him. “I can’t follow the bouncing ball”, quipped Robert.
Mark Cuban and Lori Greiner made a deal with Richard for $350K for 20% equity and a $2 million line of credit. If this deal ever gets done, it will give Richard the funding he needs to finance his growth and fill big orders, while giving Mark and Lori enough equity to keep them interested.
In the Update segment, Tom + Chee was featured. This company has grown from $1.5 million in sales and two locations to 31 locations and $47 million in sales! They won my Season 4 Sharky Award for Best Presentation of the year (2013). The night of their original appearance on Shark Tank I wrote, “These two are on their way to fame and fortune”. I’m sure Shark Barbara is thrilled with her investment in Tom + Chee. Congrats!
OVERALL RATING OF THIS EPISODE…………………A-