- Barbara Corcoran and Lori Greiner team up to battle it out against Robert Herjavec, Mark Cuban and Kevin O'Leary over a particularly enticing product. An entrepreneur from Louisville, KY has whimsical plush slippers he claims feels like pillows on your feet; inventors from Sacramento, CA show off their dynamic signage for business owners who don't want to hire human sign holders; two women from Macon, GA have created trousers and leggings that give instant, built-in uplift to one's derriere; a Dallas-based foodie wants to make his mark with his boldly-flavored line of nuts for snacking, and an update on CordaRoys, a line of beanbag furniture that has skyrocketed in sales after Lori Greiner investment.
- In this episode of Shark Tank, four entrepreneurs pitched their business ideas to the panel of Sharks consisting of Mark, Barbara, Kevin, Lori, and Robert.
The first pitch was for "Velocity Signs," a company that manufactures robotic sign waving machines. Scott Adams and Josh Faherty sought a $225,000 investment for a 15% stake in their business. The machines weighed 165 pounds and cost between $1900 and $2850 to produce. They had sold 125 units, generating $257,000 in sales over the past 12 months. The cost of production was $1000 per unit, and clients reported a 15% return on investment. The entrepreneurs projected sales of 1200 units in the next year, which would amount to $2.5 million in sales and $500,000 in profits. However, Kevin expressed skepticism about the ambitious growth projections, leading him to opt out. Mark, on the other hand, decided not to invest due to concerns about the resale potential of the product. Barbara also declined the opportunity, citing the bulky nature of the machines, which made them unsuitable for traveling salespeople. Lori, however, recognized the potential for cost reduction and business growth for small enterprises and offered $225,000 for a 30% stake. Surprisingly, Kevin and Mark had a change of heart and decided to come back into the deal. Ultimately, two groups formed, with Barbara and Lori teaming up to offer $225,000 for a 25% stake, while Robert, Kevin, and Mark formed another group and proposed the same amount for a 30% stake. After some competitive discussions, the male Sharks convinced the entrepreneurs to go with their group.
Next up was Sanjiv Patel with his gourmet peanut brand called "Lord Nut Levington." Sanjiv sought a $500,000 investment for a 30% stake in his business. The company had generated $300,000 in sales over the past year and projected ending the current fiscal year with $350,000 in sales. However, there were no profits to show yet. Lord Nut Levington was available in 600 stores, including Wegman's and ATB. Sanjiv argued that multinational corporations had outsourced innovation to start-ups like his, making acquisition an attractive end goal. Kevin declined to invest, citing concerns about the valuation of the company. Barbara also opted out, as Sanjiv hadn't personally developed the recipes and lacked culinary expertise. Lori, who had a peanut allergy, wasn't able to invest either. Robert was unimpressed with the absence of a scale-up plan, while Mark was disappointed by the lack of information on sales velocity.
The third pitch came from Pat Yates, who presented "Happy Feet," a brand of fanciful slippers. Pat sought a $375,000 investment for a 15% stake in the company. Happy Feet had achieved $6.5 million in sales over the past three years, with $2.65 million in the previous year alone. The majority of sales (95%) were made online, with a production cost of $5.50 and a retail price range of $25-30. After deducting expenses, the company had earned profits of $600,000. Barbara believed that the sales had peaked and decided not to invest. Robert felt he couldn't provide additional value to Pat and chose to opt out as well. Kevin made an offer of $375,000 in exchange for a $3 royalty until the investment was paid back, 6% equity, and perpetual rights to $1.5 from each product sold. Lori joined Kevin in his offer. Mark, realizing it wasn't a suitable investment for him, opted out. Pat countered with a 20% stake, and Kevin and Lori returned with a proposal for a 30% stake, removing the royalties. Robert matched their offer, but Pat further negotiated for a 25% stake, ultimately securing a deal with Robert.
The final pitch was from Erin Bickley and Jenny Greer, the founders of "Hold Your Haunches," a brand of leggings with a built-in Shaper. They sought a $75,000 investment for a 20% stake in their company. The pants were made of breathable but heavy material. Mark recognized that this product was not within his area of expertise and decided not to invest. Robert also opted out, believing that women would not be inclined to wear such heavy Shaper pants. Kevin voiced concerns about potential fraud and false advertising and chose not to invest as well. The leggings cost $18 to produce and retailed for $140, with a wholesale price of $90. The company had generated $165,000 in sales over the past year, resulting in a profit of $50,000. Lori and Barbara aimed to prove the male Sharks wrong and offered $75,000 for a 40% stake, along with a $100,000 credit line. The female entrepreneurs accepted their offer, sealing the deal.
The update provided in this episode mentioned a previous deal with Byron Young for his multi-functional bean bag chairs under the brand "CordaRoy's" in Episode 419. Byron had secured a deal with Lori and had achieved $3 million in sales within eight months. The product had also been successfully sold on QVC, generating $25,000 in sales per minute.
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