- Solving a holiday headache with colorful, magnetic strands; an item to bridge the gap for interfaith families; a fun, new take on traditional Christmas sweaters; luxurious clip-in hair extensions.
- In this episode of Shark Tank, four entrepreneurs presented their businesses to the Sharks: Mark, Daymond, Kevin, Lori, and Robert.
The first entrepreneur, Shawn Genenbacher, pitched his product called "Lite-Netics," which are magnetic Christmas lights. Shawn was seeking $125,000 for a 20% stake in his business. However, the Sharks learned that the lights didn't work on aluminum and the target market was mainly commercial. Shawn had been working with professional installers and buyers from Home Depot. In the previous year, his sales were $118,000 with a profit of $38,000. Despite being in business for four years, Shawn's sales had remained stagnant, so he needed to reduce costs. While a 50ft strand of traditional lights cost $20, Shawn's product was priced at $70. Kevin proposed a licensing deal with major manufacturers and offered $125,000 for a 50% stake, contingent on the licensing agreement. Robert opted out due to the high price, Mark couldn't provide strategic assistance, and Lori felt the cost was too high considering that most homes didn't have metal and the market was shifting towards LEDs. Daymond, also interested in licensing, offered $125,000 for 40%, contingent on licensing. Shawn rejected both offers.
The next entrepreneur, Morri Chowaiki, presented a product called "One Life Products," a Hanukkah tree topper for interfaith families. Morri was seeking $50,000 for a 15% stake in his business. He had already sold 12,000 units of the product, which retailed for $20 but only cost $2 to produce, resulting in a 70% wholesale margin. Over three years, he generated sales of $150,000 and had his product available in 200 Bed Bath & Beyond stores, with 70% of sales occurring online, 20% through in-flight magazines, and 10% in retail. Morri needed funding for new product design, establishing his own website, and securing fulfillment space. Kevin pointed out that the market was seasonal and the product had a one-time purchase appeal, causing him to opt out. Lori agreed with Kevin and also decided not to invest. Mark felt that Morri's business was not set up for ability to scale, so he opted out as well. Robert opted out due to poor sales performance. Daymond, interested in licensing and building a product line, offered $50,000 for 35%, and Morri accepted the deal.
Rachel Bernstein and Melissa Barone were the entrepreneurs behind "Cashmere Hair," a luxury hair extension company. They were seeking $45,000 for a 15% stake in their business. Their hair extensions, made with real Indian hair, came with clips and cost $105, but retailed for $400 for a package of seven tracks. In the past six months, they had sold $38,000 worth of products. They sourced their hair from a non-exclusive supplier and wanted to create instructional videos to sell online. They planned to leverage blogs and Instagram to drive traffic and target salons. While Mark was unsure if the business was investment worthy, Kevin couldn't see the strategic value and chose not to invest. Daymond agreed with Mark's assessment and also opted out. Lori liked the idea of hair parties at salons but felt uncertain since the entrepreneurs hadn't executed that plan yet, leading Robert to opt out. Lori ultimately decided not to invest due to the competitive nature of the market.
The last entrepreneurs, Evan Mendelsohn and Nick Morton, presented their line of holiday clothing called "Tipsy Elves." They were seeking $100,000 for a 5% stake in their business. Kevin expressed his dislike for the product, but the entrepreneurs had achieved sales of $862,000 in the previous year, with 50% of their orders coming from Amazon. They had also started exploring the retail market with Urban Outfitters. The clothing cost $11.40 to produce and was sold for $65. However, all of the Sharks advised against taking the business to retail. Mark opted out, feeling that the entrepreneurs were trying to do too much. Lori also opted out, as she believed there was nothing unique about the product and that others already existed in the market. Kevin offered a deal of $100,000 with a royalty structure until the initial investment was paid back and a perpetual royalty of $1, along with a 0.5% equity stake. Robert offered $100,000 for a 10% stake. Daymond, unable to add value on the retail side, opted out. The entrepreneurs decided to go with Robert's offer.
The update provided was about a previous entrepreneur named Rob Dyer, who had presented his energy drink business, Ruckpack, in a prior episode (Episode 410). After appearing on the show, Ruckpack experienced significant growth, with sales increasing from $35,000 to $500,000 within ten months. They even sponsored their own jet in the USAF and secured a purchase order worth $4 million with Walgreens, allowing their product to be stocked in 8,600 stores.
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