#SharkTank — “A Decade of Dreams” and a night of rain, fire, dust, and scobies in the tank
This season of ABC’s Shark Tank is the 10th season, dubbed “A Decade of Dreams” and it's been an epic season so far. Tonight, history was made with three strong, powerful, women in the tank outnumbering their male counterparts.
This is an important accomplishment in the tank and I am proud of Shark Tank for making this happen. Sara Blakely, Barabara Corcoran, and Lori Grenier are all leaders in their industries and true inspirations for millions of women across the globe.
So, why don’t we have a 1:1 ratio of female to male sharks every episode? It would be a great platform to emphasize the importance of gender equality in business and in life. Just a thought…
The Handbag Raincoat
The night started with a wet pitch in the rain by two energetic sisters, Morgan and Arley Sarner, owners of The Handbag Raincoat. Their product allows women to protect their best handbags in the rain.
The Sarner sisters valued their company at $1.2 M but only had $125,000 in sales. They had raised a significant amount of capital from friends and family to get started, but why are their sales still relatively low?
It's an innovative product but a major challenge that these entrepreneurs faced were knockoffs. They successfully shut down two copycats with only $10,000 in legal fees but now have a “behemoth” company in their space currently knocking them off. Should they fight them? Sara Blakely advised against that in cross-talk with the Sharks, referencing her similar experience with competitors when growing Spanx.
The Sarner sisters also disclosed that they had not invested anything into marketing which shocked many. As an entrepreneur, one would assume that getting your product in front of as many people as possible would be an ideal objective. Sara Blakely emphasized that “You need to be Inventing, marketing, selling,” not spending all of your time and energy litigating with knockoffs. The fact that they had burned through significant capital without any investments into marketing turned off many of the sharks, such Mark Cuban, who stated that he did not feel the entrepreneurs were “willing to do what it takes” to take their company to the next level.
The Sarner sisters left the tank with the support of all five sharks wishing them luck but no deal. At the end of the day, these entrepreneurs have a great product and need to become marketing and selling machines in order to 10X their revenue.
Reward Stock
Next in the tank, with flames and dancing Hula ladies, was Jon Hayes, founder and CEO of Reward Stock, an automated reward stocking and booking platform, that allows users to have “amazing travel experiences paid for with miles and points.”
They had a gross revenue of $50,000 in sales with 10,000 users on their free platform. The majority of their revenue had been from referral fees, such as referring someone to a car buying site.
The idea came from Jon’s amazing $40,000 honeymoon, back in his Wall Street days, that ended up only costing him $200 with the savvy use of travel points and benefits. Kevin O’Leary saw this company as a great opportunity to both complement his Honey Fund, but also provide a significant customer base to Jon’s company.
With a raise of $700,000 at a $3M valuation, Jon was able to successfully develop the product and soft launch it for proof of concept. With his background, great personality, and solid product, Mark Cuban felt comfortable to offer $320,000 for 10% stake and 1% in advisory shares. John loved the offer and quickly closed the deal with Mark for the first deal of the night.
WISP Industries
After the past two pitches, the floor was getting a little dusty. Good thing Eben Dobson from WISP Industries brought his innovative dust pan and broom. His re-engineered broom saves the backs and knees of hundreds of thousands of users.
They had $3.3 M in lifetime sales and raised $2.5 M over a six year period. Time for a Mark Cuban applause? Not quite.
WISP Industries faced the crippling side effects of “going viral” without a strong, stable marketing and sales foundation as a company. This has left Eben with $300,000 in inventory, $2.1 M in losses, $250,000 in debt, and only $50,000 left in the bank.
He invested millions into marketing opportunities but never properly budgeted the campaigns to make any money from the sales generated. Kevin pointed out, “Year after year after year, you have made no money.” He desperately needed a partner.
“As soon as you can afford it, hire your weaknesses”
-Sara Blakely
This is an example of why having access to, or raising too much money, is sometimes detrimental to entrepreneurs that haven’t properly hired employees and partners that compensate for their weaknesses. Early on in the startup process, its helpful to pretend that the money in your account isn’t there, while you hustle, guard your bank account, and only spend your capital into justifiable and strategic investments that have a clear path to a return on investment.
Mark Cuban pointed out that Eben has spent millions of dollars into his startup, while all of the other sharks only spent a few thousand to build their multi-million and billion dollar companies.
Feeling bad for Eben? No need to worry, Mr. Wonderful came to the rescue with a great offer of $500,000 for 50% stake in the company. Lori wanted to help sell it but didn’t make a formal offer.
Given the way this pitch had been going, Eben lucked out with a great deal from Kevin to help dig out of the hole he’s put himself in. Kevin stands up with his hand out ready to shake on the deal and then, you’d never guess what happens. Eben starts to get greedy asking to add Lori into the deal that was seconds from closing. Every entrepreneur across the globe starts jumping up yelling at the TV, “close the deal!”
This turned Kevin off and poof, the deal was wisped away. The entrepreneur’s lack of sales acumen to know when to close the deal, resulted in him losing out on an incredible opportunity to turn his company around.
Tangle Pets
It’s always great to hear back from startups after the tank. Tonight we heard from Liz Martin of Tangle Pets with a stunning $12M in retail sales after partnering with Lori Greiner.
Shark Tank was able to capture a touching moment when Lori showed Liz the new display of Tangle Pets at Bed Bath and Beyond. The joy of watching Liz’s hard work come to fruition with her product beautifully displayed on the walls of one of the largest retailers, brought a tear to the eyes of many entrepreneurs.
Liz is an ordinary mom with an extraordinary idea. She inspires mothers across the globe to take an idea and run with it!
The Kombucha Shop
The night finished with an awesome woman bringing scobies to the tank! Her name is Kate Field and she is the founder of The Kombucha Shop. She is bringing affordable Kombucha brewing to households across the country.
Are the Sharks thirsty for Kombucha? This sums up their initial reactions:
Don’t worry, everyone makes that face the first time they have Kombucha, they’ll start loving it over time.
Something that surprised many, is that Kate is making no claims for the health benefits of Kombucha. She stays focused on marketing the simplicity and affordability of her product to Kombucha lovers, rather than selling Kombucha itself.
Kate is a great example of an entrepreneur staying frugal and bootstrapping her way to success. She started the company with $800 and has grown it to $3.2 M in lifetime revenue. She is projecting $1.6–1.7 M in revenue this year and will profit $500,000 off of that. In addition, she has a $0 customer acquisition cost. Now its definitely time for the Mark Cuban applause.
She was asking the Sharks for $300,000 for 10% equity in her company to help guide her into getting into retail, i.e. Whole Foods. She’s crushing the direct to consumer sales online so why go into retail? She wants to diversify her sales channels and maximize her potential revenue.
Sara Blakely was interested but concerned that she would be taking 10% of the company just to make a call to Whole Foods. With further clarity from Kate, she explained that with the heat of competitors breathing down her neck, she needs the Shark’s resources to blitz the market and beat the competition.
Kate is a great designer, has a healthy physique as the face of the company, and has strong business success to date. Barbara and Sara offered $200,000 + $150,000 line of credit for 10% stake and Kate quickly closed the deal.
Mark wanted to make an offer but wasn’t able to get a word in before Kate accepted the offer with the ladies. It’s always great to see an entrepreneur that knows how to close a deal!
This was a great end to an episode of Shark Tank filled with rain, fire, dust, and scobies.
Why am I writing about Shark Tank?
In 2009, the first season of Shark Tank began. I was a young, curious, seventh grader constantly looking to learn more about the world around me. Shark Tank exposed me to a new world of entrepreneurship, where anybody, regardless of age, race, gender, or creed, has the opportunity to build a business, and succeed or fail solely based on hard work and strategic decisions. It planted the seed of entrepreneurship that began itching while in high school and finally bloomed when I founded Breiter Planet Properties. I am truly thankful for what Shark Tank has brought to my life and I am always catching reruns on CNBC during the week and watching every new episode on ABC.
Want to connect with me? Email me at Andrew@breiterplanet.com
