“Shark Tank” returned last night on ABC to hear pitches from four new inventors looking to hit it big with their new products and ideas. Yet last night’s negotiations weren’t just entertaining they were also educational as some learned a costly lesson about business, while others hit the mark dead on. Here’s how the night went down!
Inventor: Carmen Lindner
Product: Gotta Have S’More
Offer: $75,000 for 25 percent stake
The week’s first inventor to enter the tank offered a new twist on S’Mores. Carmen Lindner invented the “Smuffin,” a mini-muffin meant to duplicate the taste of a S’More, without all the outdoorsy stuff that goes along with making one. However, while Lindner had sales of $250,000 over 2 ½ years and another $165,000 projected in her next year, it was all centered in Los Angeles. In fact to ship the product required 5 pounds of dry ice and a total cost of $54, on top of the $29.99 cost for a dozen of the “Smuffins.” The sharks all passed after trying to explain to Linder that if she had so much success in Los Angeles, she didn’t need to expand, especially if she needed to give away 25 percent equity in the company to do so! The numbers just didn’t add up, which prompted Mark Cuban to tell her “you can’t see the dollars from the marshmallows.”
End Result: No Deal
Inventors: Peter & Yuen Yung
Product: How Do You Roll?
Offer: $1,000,000 for 12 percent stake
Peter and Yuen Yung entered the shark tank with their sushi chain “How Do You Roll?” The brothers grew up in the restaurant business and decided to create their own “made to order” sushi roll quick service restaurant. Promising “unpretentious good food in a casual environment,” the Yung’s in 2 ½ years had sold 40 franchises, of which 15 are now opened, plus their original pair of corporate stores. Between the two original stores, the brothers made $1 million in sales and even earned a offer for a 75 percent buy-out worth $6.6 million.
However, none of the sharks wanted to go into the restaurant business except Kevin “Mr. Wonderful” O’Leary, who agreed to give them the $1,000,000, but with a higher equity stake and a monthly distribution payout, which would be split between him and the brothers. After getting Mr. Wonderful to slightly come down on the percent stake Peter and Yuen accepted the deal.
End Result: Deal with Kevin O’Leary for $1,000,000 with 20 percent stake and TBD monthly distribution payout.
Inventors: Bea Arthur
Product: Pretty Padded Room
Offer: $100,000 for 30 percent stake
With a very recognizable name, Bea Arthur entered the tank to pitch the sharks on her psycho-therapy business “Pretty Padded Room.” Billed as “a nice place to go crazy,” the online venture was a place for people to go for therapy while still in the comfort of their own homes. Between video chats and digital diaries (e-mails) with licensed professionals, people could talk to a therapist at a reasonable price. However, Arthur’s numbers were all over the place and the sharks sensed blood in the water. Arthur couldn’t speak to a number of economic variables that were key for any business and as a result couldn’t get any shark to bite on her offer. Yet Kevin O’Leary did give her and future inventors who couldn’t get their financials straight a warning before departing; simply put if you don’t know your numbers “don’t go swimming” in the tank.
End Result: No Deal
Inventors: The Inventioneers
Product: Smart Wheel
Offer: $100,000 for 15 percent stake
This week’s final set of inventors were six teenagers calling themselves “The Inventioneers.” The group created a “Smart Wheel,” which monitored and recorded the driving habits of teenagers. If a teen drove with one or no hands on the wheel or drove with their hands in a texting position, the wheel would buzz alerting them to rectify the behavior. However, it also recorded that behavior and sent it to their parents, which was what drove Barbara Corcoran out of the deal. She knew her 17 year old son would not be sold on it and she imagined other kids would have the same reaction.
Yet, after the Inventioneers revealed they had endorsements from President Obama and the Secretary of Transportation, plus a pilot study from MIT, Robert Herjavec offered them the $100,000 but for a 30 percent stake and it was contingent on them getting a car company to agree to have it licensed. Mark Cuban then offered to partner with Herjavec on the deal if he took out the contingency and the teens agreed to change part of their business plan. In the end, all three parties agreed and struck a deal.
End Result: Deal with Robert Herjavec and Mark Cuban for $100,000 in exchange for 30 percent stake.
“Shark Tank” airs Friday’s at 9 p.m. EST on ABC.