Cup Board Pro: More than a Kitchen Aid

Authored by: Quinn Donaldson

The late Keith Young along with his three children, Christian, Keira, and Kaley, hit a home run with the Cup Board Pro. Created by former NYC firefighter and two-time Food Network Chopped Champion Keith Young, this product aims to save time and prevent kitchen messes with its patented cutting board design. Small wells on one side of the board send spills directly to the plastic cup at the edge of the board, preventing liquids from spilling onto the kitchen table. It’s also perfect for collecting chopped food items without leftover mess.

The Cup Board Pro was invented in 2010, but the venture was put on hold twice after cancer struck both parents at separate times in the last decade. Unfortunately, the Young family lost its mother and father to cancer in May 2012 and March 2018 respectively. Motivated by their parents’ love and their father’s passion for cooking and the FDNY, the Young children continued to pursue their father’s dream of making Cup Board Pro a realty and pitching it on Shark Tank.

The Sharks were incredibly moved by the Young’s story and equally as impressed with the product. The Sharks see great value in the patented design, bamboo wood quality, and removable, dishwasher safe cup component. The company sold 15% (or 300 units) of their inventory in the first three weeks after the company’s online launch, showing some initial demand and marketing success. What’s most impressive to the Sharks is that the Youngs are operating the business entirely on their own; executing sales, the marketing campaign, and distribution from their living room.

After briefly deliberating amongst themselves, the Sharks respond to the Young’s $100k for 10% equity offer in unique fashion. All five Sharks agree to counter the Young’s original offer by asking for 20% equity. Furthermore, all the Sharks agree to donate any profits they receive from their equity stake to the FDNY Foundation supporting NYC firefighters affected by 9/11 cleanup-related health issues. The Young’s immediately accept the Sharks’ counter and exit the Tank with a future for Cup Board Pro and an even stronger foundation for Keith Young’s legacy.

Analysis 

Cup Board Pro was a no-brainer for the Sharks. They all acknowledge that their expertise and networks can easily sell the remaining 1,700 units in inventory. Furthermore, the Young’s story, commitment to the business & FDNY Foundation, and Keith Young’s ingenious design is a near perfect recipe for continued sales and growth. Cup Board Pro’s $12.50 per unit cost will certainly go down as the company’s production volume increases, and the $40 retail price is in line with similar products.

The $1 million valuation wasn’t totally unreasonable, but a bit too high for the Sharks at this stage in Cup Board Pro’s life. If we annualize the company’s $12,000 in sales, the Youngs valued Cup Board Pro at a 7x EBITDA multiple ($1 million/$143k annualized profit = 6.99x). Agreeing to a 3.5x multiple is a win for both parties; the Youngs keep 80% of a promising product and the Sharks receive an attractive entry point in a straight-forward business they know they can grow and scale. The Sharks’ extra 10% will go a long way for the FDNY Foundation down the road.

Getting Cup Board Pro into every kitchen in America will take massive marketing and sales efforts. All five Sharks, especially Lori, will be able to use their expertise and distribution connections to help the Youngs grow efficiently as they enter new markets and tackle the challenges that come with scaling. Outside of sales, marketing, and Cup Board Pro’s valuation, my only critique is for Keira, and it’s very nit-picky – easy on unnecessarily using the word “like” when answering questions. She’s the youngest so I’ll give her a pass.

Finally, I cannot stress enough how important the Young children are to this product. The product and its story combined can capture audiences from all sorts of backgrounds. But the key ingredient is the Young’s determination and ability to battle through adversity. The fact that these young adults managed to launch this product and immediately produce sales only three months after losing their second parent to cancer more than proves how strong and resilient they are. Those traits alone will help them through the trials and tribulations ahead, but the love for their parents and father’s legacy will be the never-ending fire that fuels them to success in all that they do. The Sharks will sleep a little easier at night knowing that Cup Board Pro is in good hands.

Beyond Sushi: This Plant-Based Alternative Goes Above and Beyond

Authored by: Ian Gyan

In America, the foods that we love aren’t always the healthiest options. However, that’s slowly changing as people become increasingly aware of their diets.  

Still, finding a balance between food that’s good for you and food that tastes good has always been difficult. Fortunately, Guy Vaknin’s company, Beyond Sushi, presents a solution tastier than you can imagine.

On Episode 3 of Season 10, Guy calmly requested $1.5 million to help grow his New York-based company in Los Angeles, offering 25% of his west coast profits and 5% of his already established east coast profits.

His hefty ask drew a few odd looks from the Sharks, so Guy kept his puns to a minimum and delivered his pitch without much flair. A smart choice, as the Sharks grew less apprehensive as he went through his talking points.

Beyond Sushi is a multi-unit vegan restaurant chain. It makes use of veggies, fruits, and whole grains to create unique flavors, all without the use of artificial meat. The “extensive” menu includes salads, wraps, dumplings, and (sushi) rolls.

This modern approach to traditional food manages to maintain that delicate balance between flavor and nutrition. It’s what distinguishes Beyond Sushi as one of the “pioneers” of the vegan movement and shows its commitment to creating more sustainable ways of eating.

Thanks to Guy’s best-selling “Mighty Mushroom” and “Sunny-Side Up” rolls, the Sharks could clearly see that… or taste it, rather. His “amazing” sample platter included sushi made with robust ingredients like braised fennel, micro arugula, truffle shiitake sauce, 4-grain rice, and sun-dried tomatoes.

Despite the good food, these Sharks would only be satisfied with profitable numbers, and in that regard, Guy did not disappoint. It only costs Guy $1.50 to make one 280 calorie roll (8 pieces), which he then sells for $7.50. Guest Shark, Matt Higgins, absolutely loved the sound of an 80% margin but that wasn’t Guy’s only advantage, there was also his scale of operations.

Guy opened his first restaurant using the last $70K from his life savings in July 2012. Back then he only had 12 seats and 1 employee. Since then, he opened 6 locations throughout New York City.

So, how does one man handle so many restaurants?

It’s because Beyond Sushi is a commissary-based business, meaning all the food is cooked by a single distributor. This is a perfect example of working smart instead of working hard. Having one entity produce the food keeps his margin stable, cuts the hassle of keeping ingredients in stock, and allows him to focus on the macro aspects of expanding a business.

Guy owned restaurants ranging from as small as 180 sq. ft. to as large as 2,500 sq. ft., but regardless of size, each location pulled its weight. He confidently reported that last year, his east coast operations grossed $4 million in sales!

“Mr. Wonderful” leered suspiciously, as the other Sharks nodded in approval, he sensed the devil hiding in the details

Before Guy announced his sales, he revealed his resourceful partnership with Sandy Beall, the founder of Ruby Tuesday. Together, they planned to change Beyond Sushi’s grab-n-go structure to a more open-seated arrangement using Guy’s largest restaurant. When Kevin asked how much he netted out of last year’s $4 million gross, he sadly revealed that he was down $272K. Evidently, his expansion placed a lot of pressure on the entrepreneur to keep his business afloat. He assured the Sharks that this was not the norm and mentioned that the year before his deficit, he pocketed $600K out of his $2.4 million gross.

At Guy’s current pace, Beyond Sushi’s projected sales rested comfortably at $5.6 million, but to Mr. O’ Leary’s disappointment, he only expected to net $300K next year. Although, this letdown didn’t weigh too heavily on the other Sharks.

Being the food aficionado of the tank, Matt began asking about his unit economics, specifically Guy’s QSR (Quick Service Restaurant) percentage. He answered questions as quickly as Matt asked them but this eventually wore down the interest of some of the other Sharks.

Daymond cut into their conversation simply because he couldn’t understand any of the food industry-specific jargon. Since he also wasn’t familiar with the back-end of the restaurant industry, he decided that it was best for him to back out.  Daymond’s loss of appetite was echoed by a few others. Kevin also took the chance to expand on his issues with the business. Since Guy only expected to net $300K out of his projected $5.6 million in sales next year, fronting the requested $1.5 million for 25% of an expansion that hadn’t begun yet would be akin to him paying twenty times Guy’s pre-tax earnings. A valuation like that was “insane” according to Kevin, so he backed out as well.

Things didn’t get better from there, Mark correctly pointed out the already immense workload that Guy’s east coast operations placed on him. Given that Beyond Sushi wasn’t the only restaurant selling plant-based foods, Mark decided to go with his “gut” on the matter and pulled his hand away from the table. Perhaps Mark thought Guy wouldn’t be able to handle the financial burden of expanding again so soon.

This was more than likely a reaction to the entrepreneur's last year of sales. His expenses sank him so low into the red that he had to invest $160K in personal funds just to stay in business. For a seasoned money maker like Mark Cuban, a fluctuation like that raises a big red flag.

With 3 Sharks now out of the water, Guy’s eyes were left wide and nervous. At the same time, Matt and the ever-patient Lori Greiner settled in for a deal, but not before making Guy sweat a little...

“Here’s what I don’t like,” Matt said, explaining that he didn’t like that Guy’s offer would have him paying $1.5 million for 25% of operations that hadn’t begun yet, but only gave him 5% of his east coast operations, which were already profitable. Considering his losses, Guy’s initial offer now looked more like an investment to be made on faith alone.

However, these Sharks don’t deal in faith, they deal in fact. And the fact was that between east and west coast operations, the potential for a “misalignment of interests” between them was too great to ignore. With how hard he worked to counteract his deficit, it was very possible for Guy to end up too focused on east coast maintenance instead of west coast expansion like Matt wanted.

So, Matt requested more east coast equity as an incentive to ensure that guaranteed profits would come his way. Even though Guy looked terrified at the thought of giving up equity, he still offered to raise the east coast stake up to 10%. Clearly, it wasn’t enough because during the time it took Guy to respond, Lori had whispered what seemed like a fruitful agreement into Matt’s ear. They both turned their mischievous eyes back onto the now silent entrepreneur.

Matt announced that he and Lori were coming into the deal together, as Beyond Sushi was also right up her alley. Lori believed that the company would do better on the west coast, as the health-conscious movement over there was very strong. Their plan was to cross-market, get Guy into major airports and stadiums and change his life. And at first, the entrepreneur smiled, only to stop once he heard their new offer of $1.5 million for 30% of west coast operations & 15% of east coast operations.

At this point, Guy could only say “yes”, “no”, or make a counteroffer.

He chose to counter with a similar offer of $1.5 million for 30% of the west and 12% of the east. But that wasn’t enough, Lori and Matt’s offer was final. So, Guy looked to the ceiling as he pondered the deal, as though saying a prayer, and finally said, “ok, let’s do it.”

Lori and Matt sprang from their seats, rushing to congratulate him. The other Sharks congratulated him too, although Kevin didn’t hide his disapproval. He just scowled and shook his head. Maybe he saw the signs of a bad deal, but based on the way both he and Daymond started clearing out the rest of the sushi samples, Beyond Sushi would be just fine.

Ultimately, giving up equity was the best move, as it would translate to faster growth. With two Sharks worth of resources behind it, Beyond Sushi would start growing practically at "lightspeed."

The Applesauce Queen gets her American Dream

Authored by: Quinn Donaldson

There are many of us who believe they don’t have enough time to pursue their ideas and create their own American Dream. These people usually cite work, family, school, bills, and/or a host of other obligations as reasons for never investing in themselves. If you are one of those people, I’d like you to meet Keisha Jeremie.

As the Global Head of PR at News Corp. (at the time of taping), Jeremie invested a great deal of free time and sleepless weekends into Sanaía – a new approach to applesauce designed to give adults a more suitable option outside of brands that target children or the elderly. Jeremie created this organic, vegan-friendly product to attack the applesauce market the same way Chobani took on yogurt; find an underrepresented consumer segment in an existing market and tailor your entire product & marketing campaign around that group.

With poise and confidence, Jeremie initially attracts the Sharks with her plan to attack hot food trends, a tasty and well-branded product, and healthy top-line margins. Being the only player in a potentially large niche market is like blood in the water to these Sharks. Furthermore, having a tasty product that can accommodate various diets helps make Sanaía attractive to many adult consumers.

However, Jeremie runs into trouble when discussing her distribution strategy and future sales. The Sharks are turned off by her idea to sell glass jars of applesauce on Amazon Prime, citing increased shipping costs that could be avoided by her lighter weight grab-n-go style product. Furthermore, she states that she has $35 million in potential sales from many popular companies such as Starbucks, Whole Foods, and Kroger. However, in realty, she only has one Whole Foods store in Harlem, NY that’s committed to testing the grab-n-go product.

Her inability to accurately define real sales interest in her product combined with risk associated with her distribution strategy and a lack of predictable market size causes Herjavec, Greiner, and O'Leary to pass on Sanaía. Also, O’Leary, Corcoran, and Cuban all have questions about her commitment given that she has a full-time job on top of running Sanaía. With all of that in mind, Barbara counters Jeremie’s initial $150k for 15% equity offer with an offer of $150k for a 75% equity stake in the company. Jeremie quickly denies, so Barbara quickly passes.

Jeremie initially cited valid reasons and remained poised when questioned about her decision to not go full-time with Sanaía. However, she becomes emotional when O’Leary and Cuban continue to question and debate over her commitment to the company. When asked about her tears, she whole-heartedly explains how she financially supports multiple family members and that Sanaía is “the first thing she’s done for herself.” That, and the fact that she has invested half of the $500k she set aside to get Sanaía off the ground was enough proof for Cuban to offer $150k for a 25% equity stake. Jeremie immediately accepts, leaving us with a satisfying storybook ending.


Analysis & Performance Score Total: 79/100

Presentation: 45/50 
To gain the Sharks’ attention in the Tank, you need a focused, well-organized, and engaging presentation to draw them in. Jeremie did just that; she staged a problem, open market opportunity, and solution that gave the Sharks and viewers a vivid image of what the future could look like with Sanaía. Her poise and natural energy captured the Sharks’ attention and respect. However, I don’t believe anyone was truly bought the multi-billion dollar/next Chobani picture that Jeremie drew of Sanaía. And worse, she didn’t include the arguably better variation of her product in the grab-n-go cup until later. Nonetheless, her initial presentation was nothing short of excellent.

Product: 22/25 
The product itself had everything the Sharks were looking for; a tangible market, proven sales, and virtually no direct competitors. From a food perspective, Sanaía is one-of-a-kind (apple wedges inside applesauce), accommodates multiple dietary restrictions, and comes in various tasty flavors. She touts impressive gross margins on both the glass jars and grab-n-go cups of ~75% and ~50% respectively. My only criticism – the grab-n-go cups were not the focal point (see Strategy).

Strategy: 12/25
Jeremie’s direct-to-consumer strategy is decent at best. Her initial plan is to sell 4-packs of glass jars on Amazon Prime, which Cuban and O’Leary immediately hate. The shipping costs from shipping heavy glass jars would cut into her margins tremendously. Also, even after hearing from potential buyers that they like grab-n-go cups over the glass jars, her initial strategy of glass jars on Amazon Prime remained unchanged. Key point – listen to your customer.

Also, the grab-n-go cups may be a better option as far as visibility is concerned. Having these cups at every Starbucks register or at eye-level in every refrigerator unit in Whole Foods would grab millions of eyes per day. I believe the dietary accommodations combined with the $2/cup price tag would be enough for many adults to try Sanaía at least once. If consumers like the $2 cup, they may be more inclined to buy a 4-pack later. That versus buying a 4-pack of something no one has ever tasted on Amazon is a much better sell to an investor.

Finally, she confused interest from big buyers for potential sales/orders for her product, which turned off some Sharks. Also, she mentioned that those big buyers referred her to other buyers, which she took as “wow I’m getting Whole Foods AND their friends!”. Personally, I viewed it as “Your product has promise, but try it with these buyers first before Whole Foods gets involved.” If you’re going to mention that you have $35 million in potential sales, it is imperative that you have the orders to back it up. By throwing that number out, she dug herself a deep hole that she almost didn’t recover from.

Shed Defender Is The New Fix to Your Dog’s Old Tricks

Authored by: Ian Gyan

Dogs are called “man’s best friend” because of their undying loyalty. But the Sharks roaming these waters are loyal to one thing only: a profitable deal.

On Episode 2 of Season 10, Tyson and Miles Walters, brothers from Orange County, CA, learned that very quickly. They came seeking an investment for their product, Shed Defender, and as the Sharks gauged their composure, you could almost hear the message their collective gaze sent out. “Impress me.”


The entrepreneurs heard that loud and clear and their product certainly met the standard. Shed Defender is a onesie made of lightweight, breathable, and eco-friendly fabric. It eliminates the hassle of cleaning up your dog’s shed fur by containing it within the suit. So, that means no more lint rollers, brooms, or vacuums. It’s made for both male or female dogs and its open-bottom design allows them to easily use the bathroom without soiling the suit. This dog owner’s dream product is the absolute best way to press “paws” on your dog's shedding problem!

The Walters’ jovial opening presentation pulled a few chuckles out of the Sharks and making sure not to waste the moment, they carefully made an ask of $250,000 for 10% of their company. Normally, a percentage that low would raise more than a few eyebrows, but the entrepreneurs’ charismatic puns managed to keep the Sharks at bay. Eventually, the tension left the room when Tyson and Miles brought out Harley, the adorable St. Bernard modeling their product. The instant she trotted out in her sleek red onesie, the room filled with laughter and the Sharks fell in love with her. Robert rushed up to pet her, stern expressions became wide grins, and some Sharks couldn’t help but go “aww” at Harley’s fashionable entrance.

Tyson and Miles should be commended for such a clever pitch, as they were able to disarm the Sharks while simultaneously displaying their product’s worth. It was clear, dog lovers would come waving their wallets to pay for such an aesthetic product. Shed Defender wore its value as easily as Harley wore the product. Her tail wagged non-stop, as she just seemed so comfortable in her stylish outfit. Lori aptly compared it to “long johns” but for dogs. Despite all of this, Harley couldn’t distract the Sharks for long. After inspecting the equally adorable dog plushie samples handed to them, Mark started asking about their numbers.

They had been selling Shed Defender for about 18 months and in that short amount of time, they managed to make an astounding $1.2 million in sales! It’s rare for the Sharks to see a product already so well received by the market, and their reactions reflected that. They practically lost their minds. Seemingly in disbelief, “Mr. Wonderful” even asked Tyson and Miles if they were serious about those figures.

 They were, and you read that number correctly… $1.2 Million. Miles and Tyson made their sales via purchases through their website and Amazon. They’ve recently begun wholesaling their product as well. Shed Defender came in 9 sizes ranging from “mini” ($39.99) to “giant” ($62.99), and came in several colors. The source of their success was undoubtedly their ideal landing costs. It costs them only $6.23 to make a “mini” suit and $13.20 to make a “giant” suit. By now, the Sharks were salivating, and for good reason. These two were operating slightly over an 80% profit margin!

Lori and Kevin were slack-jawed, Robert did a double take, Barbara attentively took notes, and Mark exclaimed his approval. They were “killing it,” but it didn’t stop there. Tyson continued listing the product’s other perks. Shed Defender was created to tackle bad fur days, but customer feedback revealed that the onesie also naturally lowered anxiety in dogs and kept them calm. It makes sense why Harley looked so happy wearing it! Additionally, Shed Defender could even replace the dreaded medical “cone of shame” that all dogs know and hate. With such a beneficial product on display, the Sharks seemed like they were basically sold.

However, Lori cut the moment short by asking if the product was patented. Tyson’s smile faded as he explained how he had to forego a previous patent application due to a lack of capital. Sadly, this company now ran the risk of a larger competitor knocking them out of business once they started gaining traction. This didn’t bode well with Kevin or Barbara, but Mark reminded them of the incredible benefit of operating at such an outrageous margin. Still, Barbara needed convincing and pressed the brothers further about what their step-by-step plan was to make their revenue goal of $2.5 million in 2019.

 Their solution was to move into retail through wholesaling, which wasn’t good enough for Mark. It didn’t change the fact that their many SKUs (Products) made them a risky investment. Because of their healthy margin, Tyson and Miles had better potential in the online space they were already growing in, especially if they made use of Amazon’s SEO ability. If applied correctly, they’d make “more money, selling half as many units, with a third as much cash.” But since he wasn’t invested in the pet industry, Mark didn’t think he could offer them any real accelerant for their business, so he backed out.

Barbara thought the business was great but couldn’t relate to it, so she backed out as well. She expanded on Mark’s idea by cautioning the entrepreneurs not to make the number one mistake young businesses can make: having too many products (SKUs) too soon. She also recommended that they focus on developing what was already working instead of jumping into the “Neverland” world of retail. Good advice, especially considering their lack of a patent.

With three Sharks remaining, Kevin decided to bite first. He loved Shed Defender and offered to provide $250K for 33% equity. This cringe-worthy deal had both brothers glancing to the side, but they still thanked Kevin for the offer. Seeing the uneasy expressions of two potential victims, Robert repeated the sentiment, saying that he too thought their product was great and matched Kevin’s offer, his differentiator being that he was the better Shark to partner with. The room’s water level had risen and Tyson and Miles soon found themselves being circled by two equally predatory deals.

The choice was theirs to make, but before they were neck-deep and out of time to choose, Lori tossed them a life-line. She tempted them with a better deal of $250K for 28%, disagreeing with the earlier opinions about Shed Defender staying out of retail. If Tyson and Miles had a retail giant like QVC backing them, their demonstrably valuable product would easily build a TV presence strong enough to scare away any competition, even without a patent. Much to their annoyance, Lori’s shrewd tactic of letting the other Sharks fight it out first worked perfectly. Tyson turned his attention right to her and made a reasonable counteroffer of $250K for 25%. With an intrigued smile, Lori tried catching Tyson off guard by asking him to identify three traits that made him a fantastic business partner. Not missing a beat, he highlighted his non-stop work ethic, his unyielding determination, and his sense of humor, which the other Sharks confirmed as a major perk. Seemingly satisfied, Lori then asked Miles if he understood the word “no,” to which he confidently replied: “it doesn’t exist.”

The counteroffer to Lori was still a win-win, so she threw her hand up and accepted their deal. Tyson and Miles held their ground, negotiated well, and ultimately came out on top. With Lori’s QVC advantage in their pocket, there’s no doubt that Shed Defender will soon be worn by dogs everywhere!

Boxlock: A Swiss Cheese Solution to Package Theft

Authored by: Quinn Donaldson

Season 10 kicked off with what seemed to be a home-run of an idea, but quickly turned into one riddled with more questions than answers that ultimately left CEO & Founder, Brad Ruffkess, without a deal.

Ruffkess describes Boxlock as a smart padlock that secures packages delivered to your home. It allows mail carriers to use a scanner at the bottom of the lock to match a recipient’s tracking number to the recipient’s order. When Boxlock records a match, it unlocks and allows the carrier to place the package inside a storage container. The carrier then secures the package with Boxlock to complete the delivery.

In his pitch, Ruffkess explains how he, like “millions of Americans”, have dealt with package thieves, or “porch pirates” running off with his home orders. His personal experience inspired him to develop Boxlock. He sees this product as a win for both product buyers & shippers alike, with buyers gaining peace of mind regarding the safety of their orders and giving carriers a more package-secure delivery option.

Initially sold between $89-109 on Kickstarter, Ruffkess was able to sell 800 units in presale. Boxlock retails at $129 per lock and costs $65 per unit to make, giving him an above industry-average profit margin of 50%*. However, Ruffkess initially alarms the Sharks after mentioning that he’s already invested about half a million dollars in research & development (R&D) expense. Unfortunately, despite early consumer interest and a healthy top-line margin, things continue to go south for Ruffkess.

The Sharks point out issues related to changes to the delivery process and additional consumer expenses. Mr. Wonderful worries about carriers’ potential unwillingness to persistently try to unlock the storage container if the scanner doesn’t work immediately. Guest Shark Jamie Siminoff, Founder of Ring, is turned off by the drastic changes in consumer behavior, from delivery time to package placement. Furthermore, Mr. Wonderful & Mark Cuban point out that there will be tremendous costs & resources required to train carriers on how to interact with Boxlock.

Finally, Cuban also points out that product buyers will need to incur an additional expense of buying a storage container to place outside their home to use Boxlock. Despite those problems, what ultimately drew the Sharks away was Ruffkess’ inability to explain his valuation. He initially values his company at a staggering $20 million by requesting a $1 million investment for 5% equity stake in his company. When asked to justify his valuation, Ruffkess reiterates the size & complexity of the package theft problem, but provides no metrics behind that problem size or his expected sales trajectory. The lack of this information combined with cost concerns caused all but Lori to back out.

In typical Lori fashion, she leverages her QVC advantage, and the fact that QVC processes around 320 million shipments per year. Additionally, she mentions that she has been trying to develop her own solution in this space for years, but has been unable to produce a final product like Ruffkess. Utilizing her industry expertise, she confidently offers Ruffkess a $1 million loan at 8% interest in exchange for a royalty that lasts until $1.5 million is repaid and a 2.5% equity stake. Lori decides to let Ruffkess pick the per unit sales royalty she will receive.

Ruffkess counters by asking for a $1.5 million loan and a $3 per unit sales royalty until the loan is repaid and a 2.5% equity stake. Lori counters by asking Jamie to come in on the deal to utilize his industry expertise for Boxlock. He declines due to a lack of proven sales and projections for future sales. Lori backs out, so Ruffkess ultimately walks out of the Tank with no deal.

Analysis & Performance Score Total: 75/100 

Presentation - 45/50 
Ruffkess does a great job in his elevator pitch explaining what Boxlock is and how consumers benefit from the product. He described a real problem in package theft that he shows through video evidence. During his short pitch, he has an acting mail carrier show how Boxlock works and the delivery experience it fosters. This gives Sharks a clear visual of the product and its benefits. Ruffkess was energetic and engaging, utilizing effective hand gestures and eye contact while also using concise language.

Ruffkess came into the Tank with a rehearsed and sensibly-structured presentation. Ruffkess remained mostly cool and collected as the Sharks poked hole after hole in his product, showing some nervous gestures during his back and forth with the Sharks. Nevertheless, Ruffkess deserves high praise here.

Product - 15/25 
At first glance, Boxlock seems like a near perfect solution to package theft. It gives two sets of customers a great benefit; it gives product buyers peace of mind that their packages will be delivered safely and gives mail carriers more satisfaction in ensuring a safe & reliable delivery. The demonstration during his pitch shows a low-effort delivery process, but it’s unclear if Boxlock always works that efficiently since there are no customer testimonies to date. Additionally, the amount of resources needed to train carriers on using the product is seemingly large, but very much unknown. Product buyers must also utilize/purchase a storage container to use Boxlock, incurring an additional indirect cost to the consumer. While Boxlock seems like a great solution initially, there are many hurdles to clear before it can become the ultimate package theft product.

Strategy - 15/25
Ruffkess leverages a clear and precise pitch and demonstration for Boxlock that efficiently shows a market problem in package theft and a solution in Boxlock. He focuses on Boxlock’s mission to eradicate package theft, but never provides tangible evidence around the size of this problem or that people see/would see Boxlock as the solution. Furthermore, his counter offer to Lori was not attractive enough given Boxlock’s infancy as a market player.

A $3 per unit royalty on a $1.5 million loan means Lori would need to help Ruffkess sell 500,000 units before she received her money back…and that’s not including interest. After hearing Ruffkess’ counter offer, it’s no surprise that Lori wanted to team up with Jamie to reduce risk and workload. For a company that’s only sold 800 units on Kickstarter and no has recorded retail sales, the 2.5% equity stake was too small for Lori to take on a sales initiative of that size by herself. On the plus side, he did score some free marketing from the Tank, which could prove useful in the short term. Ultimately, his lack of market data, future sales trajectory, and a vague plan to implement Boxlock into his consumers’ existing behaviors ultimately left Ruffkess without a deal.

* http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/margin.html

Made for Kids, By a Kid: Le-Glue

Authored by: Ian Gyan

Children usually seek out the guidance of a trusted adult to solve their problems. But sometimes they don’t, sometimes the adults don’t even notice the problem. So when they’ve broken their toys and made a mess, what is a child to do?

Tripp Phillips has the answer. He showed The Sharks why you should never send a man to do a boy’s job. On episode 1 of Season 10, the enthusiastic 12-year old entrepreneur, along with his sister, Ally, and father, Lee, walked into the Shark Tank looking for an investment for his product, Le-Glue.

Le-Glue is a non-permanent, non-toxic adhesive used to secure Lego and other children’s building blocks together. It dissolves in water, so kids can use it repeatedly on their toys. During his witty presentation, Tripp revealed his frustration over never being able to play with the toys he built before they fell apart. This was the reason he and his father created Le-Glue, and luckily, it solved two issues. Children could build and play with their Lego, and adults wouldn’t have to worry about accidentally stepping on their children’s toys.

The young entrepreneur confidently requested $80,000 in exchange for 15% of the company, an ask so favorable that The Sharks didn’t bother commenting on the company’s valuation. The product’s value was clear, and Tripp had the numbers, accolades and vision to back it up. Over its lifetime, Le-Glue had sold over $125,000 worth of product and was already secured by a utility patent, making Tripp one of the youngest patent holders in U.S. History! His clever goal was to partner with various toy brick manufacturers, negotiate a license agreement, and get Le-Glue included in all of their toy kits. But what truly made The Sharks perk up was the impressive margin between the 43 cents it cost to make Le-Glue and the $8.99 (now $5.99) price it was being sold for on his website.

Hearing these numbers, it’s no surprise that some of The Sharks decided to jump into the frey. Kevin wasted no time, offering to provide an $80k investment in exchange for 50% of licensing royalties until he recouped his initial investment, after which, a partnership in perpetuity would be established where Kevin had a 20% stake. Kevin further sweetened the deal by basing his shares on the condition that he could successfully negotiate a licensing agreement. Knowing a great deal when he saw one, Jamie Siminoff, the former contestant turned Shark, commended Kevin on his “wonderful” offer before backing out.

Daymond, however, stepped forward to outbid Kevin with a simpler offer of $80k in exchange for 25% of the company. At this point, Lori could see that either deal would lead Tripp and his family to success, so she decided to not get her fins wet this round and also backed out. Mark soon followed suit and backed out as well, saying that he couldn’t provide an offer better than the two that were already laid out.

Le-Glue was nicely positioned to jump to the next level, but instead of immediately giving in to either offer, Tripp made Daymond a savvy counteroffer. He set his new ask at $80k in exchange for 20%, but Daymond wasn’t impressed and stuck to his original offer, as he was already asking well below his usual 33% stake. With three Sharks out and two great offers floating in front of him, Tripp was left to make a choice. After a nervous moment of silence and quick word in his father’s ear, he announced to Mr. O’Leary that he’d like to do business.

Welcome to Season 10

Welcome back to a brand new season of Shark Tank, the number one business reality show on TV!

After 9 seasons of Shark Tank, you can be certain that the pitches will get better and better and that there will be more record-shattering deals made in the Tank than ever before! Shark Tank continues to prove that the American Dream is alive and well, and that there are no limits to what you can achieve if you work hard to succeed.

At Blog Shark Tank, our goal is to critique the entrepreneurs that enter the Shark Tank, and evaluate their performance in terms of pitch, product, and overall performance. It is not easy to stand up and face the Sharks, let alone to walk out with a deal, and we applaud every entrepreneur that lives to tell the story of how they made it out alive!

So join Blog Shark Tank this season and read our critiques on the brave (and sometimes wild) entrepreneurs. Participate in our discussions on social media, and share your thoughts with us and Shark Tank fans all over the world!

Flashback: Bombas

Socks are hard to sell. 

For one, they are usually being covered up by shoes and pants legs, making it difficult to show them off. But even more so, there aren't really too many ways to make your brand of socks better than others. You can add a design like stripes, but there are thousands of socks out there with stripes (and of course many other patterns).

But what if you can make them unique in other ways. What if you spent two full years on researching ways to re-engineer socks to improve everything from the material to the stitching? And what if every time you sold a pair of socks, you gave away a pair to a homeless person?

Well this is exactly what Bombas did.

In Season 6, Bombas entered the Shark Tank asking for a $200,000 investment in exchange for 5% equity in their new sock company, placing a $4 million valuation on it. After spending two years on research and development, Bombas created a sock that is truly the top of the line in terms of quality, comfort, and design. And not surprisingly, their numbers showed it, as they did $450,000 in sales in their first year with spending no money on advertising. The quality, along with the goodwill of the company's mission generated these sales organically. 

Now although these sales were impressive, the Sharks gave the founders a hard time with this valuation, and all but one dropped out. Daymond John, the fashion guru in the Tank, was the only Shark who believed in both the product and the entrepreneurs enough to invest, and they ultimately agreed on a deal for $200,000 plus uncapped inventory financing in exchange for 17.5% of the company.

Since then, it has been one success after another.

In the two months after airing on Shark Tank, Bombas did over $1.2 million in sales. And to date, they have reached the $50 million sales mark. But what's even more impressive is the amount of socks the company has given away. In less than five years Bombas has donated over four million socks to people who need them, and have been a supportive force for other non-profits as well.

$50 million in sales. 4 million socks donated to the homeless. 

That is entrepreneurship.

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Click here to read more about socks!

The Seventy2 Survival Kit

If disaster strikes, what would you need in order to survive for 72 hours?

Christian Schauf and Mike Escamilla have that all figured out.

The two entrepreneurs walked into the Shark Tank on the second episode of Season 9, to seek an investment for their product, the Seventy2, otherwise known as the world's first fully-integrated survival system. The Seventy2 is a bag packed with survival essentials including food, lights, gloves, a blanket, an air filtration mask, a water filter, and a shovel that converts into a pick-axe. The idea is for people to keep these bags in their homes (and wherever they go) so they are prepared in case of an emergency situation. And in times where hurricanes and other severe weather patterns are forcing people out of their homes, this product can literally be a life-saver.

The entrepreneurs came in seeking $100,000 in exchange for 5% of their company, which imputes a $2 million evaluation on their company. While this evaluation seems high at first glance, Christian and Mike did have numbers to show for it. After six months of business, the product has already sold $700,000 of product in 64 countries. And to get the business off the ground, they raised $400,000 through a crowdfunding campaign in just one month!

Very quickly it became obvious to the Sharks that these entrepreneurs have the tools needed to survive. But for this very reason, Mark went out because he doesn't like being "dumb money" for businesses that don't really need more than just cash. Barbara didn't seem very interested in the business from an investment standpoint, and she dropped out as well. Robert though offered a proportionate $200,000 for 10%, and gave them just a brief window of time to make a decision. And before Lori could even get her offer out on the table, the entrepreneurs used their survival instincts to act quickly and take Robert's deal.

Shark Spotlight: Sir Richard Branson

Richard Branson is a serial entrepreneur, investor and philanthropist.

He founded the Virgin Group, which has created more than 400 companies spanning travel, financial services, telecom, health & wellness, and more recently, space travel.

At the age of sixteen his first business venture was a magazine called Student. In 1970, he set up a mail-order record business. In 1971, he opened the first of a chain of Virgin record stores, later known as Virgin Megastores. Branson's Virgin brand grew rapidly during the 1980s, as he set up Virgin Atlantic airline and expanded the Virgin Records music label. In 1999, Branson was knighted at Buckingham Palace for "services to entrepreneurship."

For his work in retail, music and transport (with interests in land, air, sea and space travel), his taste for adventure and for his humanitarian work, he became one of the most prominent figures in British culture. In 2002, he was named in the BBC's poll of the 100 Greatest Britons. In January 2016, Forbes listed Branson's estimated net worth at $5.2 billion.

Source: ABC.com

This article is sponsored by Global Business Centers, offering great Virtual Office and Executive Conference Rooms Solutions.

Alex Rodriguez: From Baseball to the Shark Tank

Season 9 of Shark Tank features some new guest Sharks, one of which is none other than former baseball player Alex Rodriguez (A-Rod). It is becoming more and more common to see major league athletes build companies around their name, and A-Rod is one of these athletes. 

Check out this Forbes article by Ky Trang Ho which gives great insight into A-Rod's company and his winning mentality: 

This fall baseball icon Alex Rodriguez is diving into the Shark Tank -- ABC’s hit business reality show.

“I’m very proud that I’m the first Hispanic shark,” said the former Yankees slugger, known as A-Rod. “I’m the first athlete shark, which is kind of cool.” What’s really cool? You should know: A-Rod is about as big a power hitter in business as he was America’s pastime.

His A-Rod Corp holding company has a hand in auto dealerships, gyms and real estate with a payroll of about 500 employees. It’s a rare diamond in the business world considering only 0.3% of the 5.9 million U.S. companies employ more than 500 people.

A Shark Tank entrepreneur would commit a major foul in declining an offer from the three-time MVP.

His 953,000 followers on Twitter, 1 million on Instagram and 1.5 million on Facebook will score eyeballs galore for any product. He could go to bat for companies seeking deals with professional sports teams or leagues.

“The potential of one plus one equals three is always in play if you partner with me,” Rodriguez said in a recent phone interview. “I can pretty much get you wherever you need to be to either show your pitch or show your product. If you are someone who needs to get into Walmart, we’ll go out and get you a meeting with their top executives.”

Champion of the Fastest-Growing Market

No other shark could wield as much influence over the fastest growing U.S. demographic like this bilingual Dominican American. At nearly 57 million, Hispanics account for 18% of the U.S. population and are expected to more than double over the next four decades, according to Nielsen. Their buying power of $1.3 trillion eclipses the gross domestic product of Russia -- the world’s 12th largest economy. If they were a state, it would be the fourth largest behind California, Texas and New York. Hispanic buying power is projected to hit $1.7 trillion in three years.

Should Rodriguez’s girlfriend join the game, the marketing potential multiplies exponentially. Actress and pop star Jennifer Lopez sports 42.9 million Twitter followers, 68.8 million on Instagram and 42.2 million on Facebook.

In the Shark Tank, the World Series champion considers himself a rookie. He’s more focused on finding good entrepreneurs with a strong management team than striking a home run with the next fidget spinner.

“It's always been my philosophy that I invest in jockeys and not horses,” said the 14-time All-Star. “Even if that business doesn't work, this is somebody I want to be in business with and perhaps I can bring them into one of my other projects. And we can build something because I believe in people. People actually run the business. People and players actually win championships.”

This article is sponsored by Merchant Account Solutions. Take a look at some of their great point-of-sale solutions such as the Clover Register.

The CEO of Tower Paddle Board Created A Brand

As good as any new idea or product may be, no investor is willing to put down money until he/she has complete confidence in the entrepreneur behind it. Read this great article by Denise Lee Yohn of Forbes about how Stephan Aarstol, the CEO of Tower Paddle Board, is the exemplification of an entrepreneur worthy of getting an investment from the Sharks.

For many entrepreneurs, appearing on the TV show Shark Tank is ultimate win. But for Stephan Aarstol, founder and CEO of Tower Paddle Boards, being on the show was just a stepping stone in his quest to build a great brand.

Of course, Aarstol’s start-up paddle board company, Tower Paddle Boards, gained broad exposure from his Shark Tank segment and the deal he forged with billionaire Mark Cuban. Before he appeared on the show, company gross revenue for the first half of the year was a mere $100,000. Afterwards, annual revenues jumped to $1.7 million, and then $3.1 million, and hit approximately $5 million in 2014. Aarstol also credits Cuban with advising on bigger picture strategy and suggesting growth opportunities such as making custom boards.

But the foundation for Tower Paddle Board’s success was laid well before Aarstol’s Shark Tank appearance. The impetus behind its growth was Aarstol’s insight into innovation which he explained to me in an interview. He told me there are three types of innovation. The first is product innovation, which Aartsol describes as the riskiest and toughest. “A lot of times you innovate on a product and then there isn’t a market there,” he says. “There are a lot of unknowns, so that’s the innovation of big companies.”

Smaller companies that can’t afford to take such risks can innovate on distribution. He points to Netflix as an example, saying “Netflix took Blockbuster’s business model of giving people movies in their home, but instead of going to a store, they get them by mail and now they download them.” He says distribution innovation is much easier and, “In today’s world, that’s where the huge gains are being made.” Uber serves as another example of this kind of innovation.

Then there’s marketing innovation done by the likes of companies including Google and Facebook. “They never advertise. They have a product that’s so compelling, it creates a network marketing effect,” Aarstol explains. “Your customer experience becomes much more important. It’s got to be so over the top that customers will tell their friends.”

Marketing innovation has driven Tower Paddle Board’s success. While other paddle board companies were either selling through specialty retailers or direct through fancy websites and traditional advertising campaigns, Aarstol decided to “hack the system” and use search engine optimization and social media to grow his business. Simply by showing up first in search results and sparking word of mouth marketing, Tower has become a popular brand with a legion of customers and followers. In fact, his zero spend on advertising got the attention of the Shark Tank’s Kevin O’Leary aka Mr. Wonderful (whose deal offer Aarstol turned down in favor of Cuban’s.)

Aarstol’s intuition about his brand also extends well beyond what his Shark Tank success proved. He describes his company as “an online marketing agency that owns a surf brand” and a player in a constantly evolving field. So he says he is always trying to reinvent what they’re doing and ultimately he wants to build a brand that accommodates that flexibility. He holds Richard Branson’s Virgin group of companies as a model and is building his brand to embody the beach lifestyle in many different categories. Flip flops, sunglasses, bikes, surf boards, and other adventure sports are among the 25 companies he has planned for Tower. His goal, to roll out 2-3 companies each year, seems do-able given that they’re all based on the same business model and leverage Tower’s existing strong partnerships with Amazon and daily deals site Woot.

In addition to Aarstol’s insight into marketing innovation and far-sightedness of brand flexibility, Tower’s success rides on his foresight into the future of brand-building. He states, “Every brand is now a media brand,” and he says that energy drink Red Bull has demonstrated the power in creating the media for its target market. That’s why Tower has created its own magazine and amassed 25,000 subscribers. His plan is to launch every new company through the magazine and establish the disruptive nature of the brand through it. “We’re doing marketing backwards,” Aarstol explains. “We’re finding our audience, making them happy, and building a brand before we ever even try to sell them anything.”

These aren’t just claims from an eager entrepreneur. Tower Paddle Boards has been named among the fastest growing private companies in San Diego and top 10 innovative products of INC 500 companies and hailed as a spotlight customer for Amazon and PayPal.

Aarstol may have Shark Tank to thank for fanning the flames of his company’s growth, but his unique take on how to build a brand today ignited Tower’s initial spark and continues to fuel its fire.

Denise Lee Yohn is a brand-building expert, speaker and author of What Great Brands Do and the upcoming book, Extraordinary Experiences.

Blog Shark Tank Rapid Interview: Spy Escape and Evasion

In Season 5 of Shark Tank, former CIA officer, Jason Hanson pitched his Spy Escape and Evasion training business to the Sharks. After getting an investment from Daymond John and turning his business into a brand, Jason has been hard at work doing what he loves - making people safe and growing his business. Blog Shark Tank recently caught up with Jason and asked him a few questions about his Shark Tank experience and entrepreneurship. Here goes:


1) What is Spy Escape and Evasion all about?
My company teaches the average American spy secrets to keep them safer on a daily basis. This includes how to escape duct tape, rope, zip ties... how to pick locks... how to detect lies... how to determine if someone is following you... and much more.

2) What gave you the idea or inspiration to start your business?
I spent almost 7 years working for the CIA. I believe all of us want to make sure our family is protected and safe.

3) Do you think Spy Escape and Evasion would have the same success it has today had it not been featured on Shark Tank?
Shark Tank was a huge blessing. I think I would have had the same success but it would have taken me a lot longer to get there. Shark Tank made it happen quicker.

4) What did you do to prepare for your pitch once your business was accepted?
I watched every episode of Shark Tank, I read all of the books the Sharks had written and I practiced my pitch over 1,000 times.

5) How long was the actual pitch in the Shark Tank?
About 55 minutes.

6) How involved has Daymond been as an investor, and how often do you speak or meet with him?
In the beginning we spoke about once per week. Now that we’ve been together awhile we only talk when we need to. Daymond is down to earth and a great guy.

7) What are some of the sacrifices you have made as an entrepreneur?
I’ve probably forgot most of them because there were so many. Things ranging from lack of sleep to doing whatever it takes to get the job done.

8) As an entrepreneur, do you ever look back at the cross-roads of your business or career choices and have regrets, or do you only look forward?
I only look forward. I don’t have any regrets. I’m very happy with where I am at.

9) Who do you look up to, and what inspires you?
I look up to entrepreneurs who realize family comes first and who realize what a blessing they have been giving. Also those who realize it’s their duty to give back to others. What inspires me is to help keep others safe and to be the best at what I do.

10) What are 3 tips you have to aspiring entrepreneurs - people who know they want to create something big, but just haven't been able to do it yet?
- You have to realize not everyone is made to be an entrepreneur. If you can’t handle risk it’s not for you.
- Get up at 5am. Work to at least 5pm daily. If you aren’t willing to put in at least 12 hours a day you won’t make it and don’t want it badly enough.
- If you never quit, you’ll eventually make it.