From kiddies clubbing to one of the wildest entrepreneurs to ever appear on Shark Tank, the latest episode was interesting, to say the least. In case you missed what happened in the tank, here’s a recap:
Baby Loves Disco tries to dance away with $150,000
First into the Shark Tank were Andy and Heather Blackman, founders of Baby Loves Disco, an event company dedicated to hosting dance parties specifically for kids! Andy and Heather asked the Sharks for a $150,000 investment in exchange for 10% of their company. The concept behind Baby Loves Disco is simple: they throw family dance parties featuring real music at real nightclubs, except these parties happen in the middle of the afternoon rather than the middle of the night. Tickets to the events are roughly $12-20/head and average attendance is about 350 per party. Initially the Sharks were impressed by the company’s projected sales for $525,000 last year and $750,000 this year, however they were less impressed that Baby Loves Disco relies on large amounts of sponsorship for funding. With major concerns about the business model all of the Sharks bowed out without offers. Andy took their rejection in stride though, saying “It’s a humbling experience. Sometimes it feels good to get your butt kicked on national TV.”
Cowboy Ryan promises that the Lose 12 Inches in Any 12 Workouts system is worth $125,000
Second into the Shark Tank was an entrepreneur from the wild wild west, and certainly one of the wildest guests to ever appear in the tank. Cowboy Ryan entered the tank seeking a $120,000 investment in exchange for 25% equity in his fitness company, Lose 12 Inches in Any 12 Workouts. After years of bull-riding, Ryan developed serious lower back pain that made it difficult for him to continue in the sport. In an effort to get back on the horse (literally), Ryan got certified as a personal trainer, which led to the creation of his “rodeo abs” workout plan. His Lose 12 Inches program is based off educating users about how to calculate their heart rate so they can workout in the ideal heart rate range for maximum results. Ryan also recently had a special exercise machine developer, which has hit a little over $1 million in sales. Yet, despite Ryan’s own impressive physique, Lori has serious doubts about the company’s claims that 12 workouts will result in 12 lost inches. Daymond, on the other hand, is impressed with Ryan’s willingness to do whatever it takes to make the company a success. He makes an offer of $125,000 for 25% which Cowboy Ryan quickly accepted! To quote Ryan, “WOOHOO! That’s what I’m talkin’ bout!!”
Shark Tank Success Story: The Painted Pretzel
Earlier this season Shark Tank fans met Raven, owner and founder of The Painted Pretzel, a gourmet dipped pretzel company. Before Shark Tank, Raven’s sales were around $75,000. But since inking a deal with Mark Cuban, The Painted Pretzel is now at $350,000 in sales, and working out a professional facility, rather than her own kitchen. True to his word, Cuban has also gotten The Painted Pretzel into his Landmark Theaters. Congrats Raven and Mark!
Cell Helmet seeks $160,000 for 20% of protective case company
Third into the Shark Tank were two buddies from Greensburg, PA, seeking a $160,000 investment in exchange for 20% equity in their company, Cell Helmet. Dave Artuso and Mike Kane invented Cell Helmet as an alternative to supposedly indestructible cell phone cases and expensive device replacement deductibles. Cell Helmet is a protective case, and the company will repair or replace damaged devices for just $50. The guys call Cell Helmet a “safety net” for when cases fail. As for the numbers? Cases retail for $44.99, which include a 1-year timeframe for damaged devices. Consumers pay $50 for device repairs, and it costs Cell Helmet $77 per repair. They defend that cost by saying that their repair rate is only about 3%, which they say makes them a profitable company. Unfortunately the Sharks worry that the protective case biz is a competitive market, and that the guys’ business model opens them up to potential abuse. With that, all of the Sharks are out.
Owner Byron Young convinces the Shark Tank to invest $200,000 in Cordaroys bean bag chairs
Last into the tank is Byron Young, founder and owner of innovative bean bag bed company, Cordaroys. Byron entered the tank seeking $200,000 in exchange for 20% of his company. Byron explains that Cordaroy chairs are the most comfortable and versatile chairs in the world. While they look like standard bean bag chairs, the cases actually unzip to reveal a bed inside. The idea has a utility patent, and Bryon claims he has “only” $1.4 million in 2011. The Sharks are confused as to why Byron isn’t proud of that number, but he explains that the company has been designed to be a $5 million company, and since the company’s inception 12 years ago, he’s experienced yearly sales of up to $3 million. The Sharks look to be liking Byron’s company more and more, and they’re especially impressed by Cordaroy’s margins of 40% wholesale and 80% retail, including at Cordaroy’s retail storefront in Mall of America. Sensing her opportunity to pounce, she throws in an offer that she recognizes isn’t going to be popular: she’s in at $200,000 for 60%. Lori reasons that Cordaroy is just going to require too much of her time for her to have any less equity. Byron counters at 51%, but Lori stays firm, and is only willing to drop to 58%. In an ending quite similar to that of Rick Hopper from Readerest’s experience in the tank, Bryon says yes and the deal is made!