Flashback: Mango Mango Mango

By: Michael Barbera
Strategy Consultant
@mbarberausa

The ladies of Mango Mango Mango entered the tank with a well-rehearsed pitch (full of dancing and synchronized jingles) and more importantly, a tasty product. All five Sharks loved the taste of the mango preserves - a sure bet that once tasted, a consumer will make a purchase. However, the only problem the product seemed to solve was a satisfaction of the taste bud. 

One of the key reasons for any company to be denied private equity funding is the lack of solving a problem in the consumer’s life. Yet although it's not a requirement, Mango’s handicap doesn't improve with their industry, as the food service industry is notorious for offering extremely low profit margins. And as any avid Shark Tank watcher can tell you, the higher the profit margins, the higher chance of getting an investment. But even though there were two serious handicaps at this point, all Sharks were still in and the business had a chance of receiving capital. Why? Because the product was that good!

The final remaining variable that could help secure an angel was the cash flow of the business. Mango’s COGS (cost of goods sold) were quite high, at nearly $3.00 per jar. With a sale price of $6.00, this leaves Mango with a 50% profit margin before operating expenses and distribution. The motivated ladies of Mango were not receptive to third-party manufacturing and distribution, which would eventually lead to less production, less sales, and exhaustion. This naturally caused Kevin O’Leary to utter his infamous words, “you made a hobby”, which is true for all businesses that don't generate profit. make any money.

In the end, Mango Mango Mango didn't receive any offers from the Sharks, which was ultimately for the best. They are better off using their own capital for growth, rather than seeking equity-based capital in the food service industry.

Spy Escape and Evasion: Flashback and Flash Forward

"The name's Hanson. Jason Hanson".

Just a few episodes ago Shark Tank fans all around the country watched as former CIA officer, Jason Hanson, covertly stood and mouthed these words in front of the Sharks before pitching his extremely unique business. Spy Escape and Evasion is a seminar for everyday civilians to go to learn safety and survival secrets from a man who has needed to use them to survive his career.

Flashback:

Jason asked the Sharks for $100,000 for a 15% stake in his company, which as of then had gross sales of $306,000 and profit of $128,000. As part of his presentation, Jason called upon a couple of volunteers from the Shark audience to try out some of his tactics. First, Barbara went up and tied Jason's hands tight with duct-tape, only to see him break out of it a few seconds later - without breaking a sweat. Next, Robert went up to serve as the victim, as Jason tied his hands together with a strong zip-tie. But Robert was also able to break out of this with the parachute-cord shoelace Jason was wearing.

While all the Sharks watched with amazement, Kevin's mind seemed to be thinking of ways to destroy this entire business. He asked Jason how he was allowed to be sharing these secrets with regular civilians. But to his surprise, Jason answered that he already spoke with the agency and got clearance. Roger that Kevin?!

With an investment from the Sharks, Jason was planning on opening a huge training facility in Utah where people will come in for a two day course. Day 1 would be learning the skills (getting out of ducktape, picking locks, detecting surveilance, etc,), and Day 2 would be actual missions with enemies and obstacles. The Sharks though didn't like this plan. They argued that people would not take the time to fly over to Utah to learn these skills. Instead, they proposed that Jason continue with his current business model (which seemed to be working) of flying to heavily-populated cities and giving the seminars there. Jason made it clear that he was definitely open to changing his business model, and with that, the Sharks were quite interested in partnering with him. Well, at least Robert, Daymond, and Mark were.

Robert was the first to make an offer, offering $100,000 for 50% of the company. He felt that this was a reasonable deal because the business model had to still be perfected, which would require more of his time and effort. Daymond insulted this offer calling Robert a greedy savage, and then made a competing offer of $150,000 for 45%. Because Mark was still on the fence and the other Sharks were out, Jason accepted Daymond's time-sensitive offer and walked out of the Shank Tank, mission accomplished.

Flash Forward:

After making a deal with Daymond, Spy Escape and Evasion has been unstoppable. In the first week after airing on Shark Tank, the company did $200,000 in sales, which previously took over 8 months to do. Since then, Spy Escape and Evasion has done a $1.2 million royalty deal with a survival company, been featured on the Rachael Ray Show, and is in the process of publishing a book and creating a TV show. Talk about the Shark Tank Effect! Daymond has clearly been instrumental in helping grow this business and is in touch with Hanson and his team on a weekly business. The company has also improved its online presence with their brand new website, http://www.spyescape.us.

Jason Hanson will be flying to many different cities to give his seminar and teach regular civilians the secrets he was taught as a CIA officer. It is the chance of a lifetime to learn from a true master in espionage, so be sure to sign up!