Season 7 of ABC’s Shark Tank continued with episode 5 tonight. The multi-million and billionaire business tycoons (aka the sharks) featured in this episode were Robert Herjavec, Lori Greiner, Daymond John, Kevin O’Leary and Mark Cuban. These five sharks listened to four pitches from up-and-coming business owners who were looking for an investment in return for a stake in their innovative businesses.
So here is the recap of tonight’s tank:
- Three Jerks Beef Jerky
Asking: $100,000 for 15%
Founders Daniel Fogelson and Jordan Barrocas came into the tank with their product, Three Jerks Beef Jerky. It is a specific type of jerky made from prime cuts of filet mignon that offers a slightly more sophisticated taste profile than what is currently being offered in terms of jerky selection.
Right away, the sharks were curious as to why they named the company “Three Jerks,” in which Daniel and Jordan explained that there used to be three of them behind the business, but they had a seemingly bitter split with their former partner.
Daniel and Jordan tell the sharks of their margins, as they sell the jerky for $11.00 a pack while it cost them $3.12 to make it. In the past 12 months, the company has made about $350,000 in sales.
All of the sharks really enjoy the product, and Kevin, of course, goes on about being a connoisseur of fine wines, explaining how he would eat the jerky with some expensive wine. Unfortunately, the sharks also identify how tough the jerky business is and how a few key players dominate it.
Nonetheless, O’Leary starts the bidding at $100,000 for 33%. Cuban drops out. Robert steps into the ring at $100,000 for 20%. Both Lori and Daymond decide to offer them the exact same deal as Robert ($100,000 for 20%). This leads Kevin to increase his valuation to $125,000 for 33%.
After the two owners express interest in Kevin’s experience, Daymond gets antsy and lowers his deal to 17% and then 15%. Thus, Daniel and Jordan close a deal with Daymond at $100,000 for 15% (exactly what they came in looking for).
- The Skinny Mirror
Asking: $200,000 for 20%
Definitely an interesting concept behind this business…Belinda Jasmine created The Skinny Mirror as a product meant to inspire people to feel confident with their appearance. The Skinny Mirror is a mirror that is designed to create a subtle slimming effect, thus making people appear leaner than they really are while looking in the mirror.
Both Daymond and Lori give the mirror a go and agree that the mirror definitely does what the name implies. Belinda explains that she has sold about 350 units, which has generated revenue of about $85,000.
Soon after, Kevin criticizes the idea and says that it is a scam. He goes on to explain that people should have to deal with what they actually look like and make real lifestyle changes if they really want to see a difference. He drops out.
All of the other sharks agree on some level or another with Kevin’s reasoning and drop out. Thus, Belinda leaves the tank without a deal.
- The Switch Witch
Asking: $55,000 for 25%
Rob Bouley and Lara Spear Riley enter the tank with their idea of The Switch Witch. Their product kind of rides on the coat tails of products such as the “Elf on the Shelf” and the “Mench on the Bench.” The premise behind the witch is that parents exchange the witch and a present for an allotted portion of their kids candy after they have returned from trick-or-treating.
The website further explains, “Rob understands the joy of a sweet treat. As a parent, he understands the task of teaching children about moderation and responsible eating habits. On Halloween night of 2013, Rob learned about Switch Witches who switch kids’ Halloween candy into gifts! Immediately he, though: ‘What if families everywhere could have their own Switch Witch? What if I could help make that happen?’”
Kevin is the first to criticize the idea, saying that the seasonality of the product is “brutal.” Cuban also notes that the whole idea seems forced. In the end, the other sharks also can’t get behind the idea and drop out. Although Daymond says that he thinks the product has potential and at this point it seems like a pretty good hobby for Rob and Lara that could grow into something more.
Thus, Switch Witch leaves without a deal.
- XCraft – X PlusOne
Asking: $500,000 for 20%
JD Claridge and Charles Manning came to the tank to pitch their ultimate drone, the X PlusOne. Their company XCraft created this particular drone to offer consumers precision when it comes to both landing and hovering capabilities.
Regarding finances, the two men explain that the drones cost $400 to make, and they sell them for $1800. Needless to say, this gets all of the sharks listening. JD and Charles then explain that they are looking for the half-million investment to scale down the production of the PlusOne drone and finish up their latest innovation, the phone drone, which can be controlled by a smartphone.
The bidding starts with Kevin, who offers $750,000 for 25%. However, Daymond is quick to top his deal by offering $1 million for 25%. He too is outdone, when Lori comes in at $1 million for 20%, which Kevin right away matches. Subsequently, JD and Charles suggest that the sharks come in on a joint deal.
The sharks end up closing a deal with the two entrepreneurs at $300,000 each for 5% equity. Thus, all five sharks get a 5% stake in the drone company, and the total investment adds up to $1.5 million.
Check out next week’s Shark Tank to see guest shark, Google executive Chris Sacca, as four new company ideas are pitched: a tech-education company, a specialized home rental website, a unique twist on a popular hot drink, and a device that can inflate objects in seconds. Tune in Friday, October 30 at 9/8c on ABC.