“Shark Tank” returned last night on ABC to hear pitches from four new teams of inventors looking to hit it big with their new products and ideas. Yet all four also learned about the downside of high end products and how the “cool guy” syndrome would impact them every time. Here’s how the night went down!
This week’s sharks: Lori Grenier, Daymond John, Kevin O’Leary, Mark Cuban and Robert Herjavec
Inventor: Brooke Bryant & Brittany Hayes
Product: Addison’s Wonderland
Offer: $90,000 for 20 percent stake
First into the tank this week were Brooke Bryant and Brittany Hayes with their line of children’s bedding called “Addison’s Wonderland.” This was essentially a build your own collection, but the problem was the cost associated with the products. For a twin bedding set the price was around $1400 meaning this was very high end retail merchandise. However this was also successful high end retail merchandise as Bryant and Hayes after just a year had $130,000 in sales with just under 50 percent of that being pure profit. Still the pair ran into a problem as the sharks were divided on if this was a business that needed help and if it was a business that should change its strategy and cost structure. In the end, only Mark Cuban remained interested but ultimately saw this as something that wouldn’t yield a significant return on his time and reluctantly bowed out.
End Result: No Deal
Inventors: Steve Maloney & Stephen Kirkpatrick
Product: Muddy Waters Camo
Offer: $150,000 for 5 percent stake
The next pair of investors into the tank was Steve Maloney and Stephen Kirkpatrick who went in asking for a lot of money and offering a very small percent stake. Usually that is a dangerous combination as the sharks are quick to recognize a high (and normally) unrealistic evaluation and that was again the case. Maloney and Kirkpatrick created Muddy Waters Camo, which was camouflage that was more realistic than anything on the market. Using a 54 step process (yes, you read that right), the men would photograph an area of terrain and then map it to clothing to help would be duck hunters/nature photographers blend in better to their environment.
While it was an interesting idea that in its first year had already produced $150,000 in sales, the sharks said the men had to have the same size brain as a duck if they thought the company deserved a $3 million evaluation. Still Kevin O’Leary recognized the potential value in the licensing side and offered to make a deal but for 20 percent. Yet Maloney and Kirkpatrick refused to budge on their numbers as they had already sold 16 percent of the business to outside investors using that high rate and felt it was accurate. O’Leary then passed.
End Result: No deal
Inventors: Megan Jackson Carreker & Aimee Miller
Product: Hip Chixs
Offer: $150,000 for 35 percent stake
The third set of would-be inventors this week were Megan Jackson Carreker and Aimee Miller with a new line of denim jeans. Best friends from Texas, the ladies designed jeans that would be stylish for any occasion and thanks to an angled design look more slimming on consumers. Although the ultra-high end jeans cost $187 and only sold 300 pairs in its first year for total sales of $12,000. The sharks also were turned off by the fact it cost $68 to make and they then sold them for $80 to stores, which was a low profit margin. All of the sharks agreed getting into this business requires a lot of time and money and none of the five were willing to invest either in this particular product. Lori Grenier put it best by saying “it was too high a hill to tackle” and for that reason she was out.
End Result: No Deal
Inventors: Taylor, Brooks & Tanner Dame
Product: Proof Eyeware
Offer: $150,000 for 10 percent stake
Lastly this week a trio of brothers entered the tank with their brand Proof Eyeware. The product centered on handcrafted eye wear made from wood, thus making every pair unique. The Boise based brothers came from a family with “sawdust in their veins” and were able to get a strong launch to their business with $433,000 in sales in year one through a grass roots campaign and a trade show marketing strategy.
At a cost of $14 to make and a $100 price point at retail, the brothers saw a $150,000 profit in year one which they sunk back into their product. In addition, the product itself had a celebrity hook as “A-listers” like Beyonce, Snoop Dogg and Kelly Rowland were fans of the eyewear. The problem was that as Daymond John pointed out this was a high end “cool brand” and unless the brothers were willing to lower the price and enter the big box store world, they wouldn’t be profitable as they would continually be unable to supply product to meet the demand. John reminded everyone that cool brands may be cool but they are also broke.
Still both Kevin O’Leary and Robert Herjavec made offers of $150,000 for 25 percent stakes, but O’Leary’s came with a $2.50 royalty that would eventually shrink to $1. Of course Herjavec’s deal was the stronger of the two, but the Dame brothers hesitated and then asked Robert for more money ($200,000) with less of a stake (20 percent). When Herjavec wouldn’t change his offer, the trio passed on the deal leaving a solid investment on the table. John called the unwillingness to change “cool guy syndrome” which was unfortunate given the brothers seemed liked smart businessmen who operated under the model “everybody has wings to fly, but just need to help.” In this case they just didn’t want to take the help at that price.
End Result: No deal.
“Shark Tank” airs Friday’s at 9 p.m. EST on ABC.