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You have the dream. They have the money. But do you have what it takes to swim with five of the business world's elite sharks? Recaps by Chico Alexander, GSNN
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Episode 1 (C-Note: Per the disclaimer at the top of the show, the following are actual negotiations between entrepreneurs and investor "Sharks". The Sharks are investing their own money at their discretion. No offer is being made to, or solicited from, the viewing audience. Please enjoy the show.) One is a real estate magnate in New York City. One sold his IT firm at the height of the dot-com bubble for $100 million. One turned a software company into a $3.7 billion transaction. One is an infomercial pioneer worth billions. One founded a successful clothing line that continues to rake in money every day. They're not your ordinary average businessmen. They are sharks. And this... is Shark Tank. Based on the Japanese format "Money Tigers" and perhaps well-known by its British sister "Dragons' Den", the show will feature small business owners venture into the tank and make their case for a cash offering for their ideas in exchange for a stake in said ideas. If the Sharks hear an offer that they like, they'll fight it out against each other for the best deal. In the end, if the sharks make an offer, and the owner likes it, they'll strike a deal... but if the owners pull out... or if all of the sharks pull out... they leave with nothing. And in the great economic crisis since the Great Depression, the Sharks are all that stand between your dream... and its possible collapse. First into the Tank... OWNER: Tod Wilson and Mr. Pieman;
Somerset, NJ There's a demand for comfort food in these hard times. They sell over 3000 pies daily, each one of them handmade with love. But in the beginning, he made some bad business deals which set him back a hot cent. He's on his third bank loan, so that's no longer an option for him. Last year, he sold as a brand wholesale $850,000 in pies. The problem is that he can't keep up with demand. His sweet potato pie represents 94% of the wholesale and over half of his total business. His business started too big too soon, and seven years later, he has a successful wholesale business. And McDonald's has been calling for orders. Robert likes the story, but he's out. He's afraid that he's going to make the same mistake, cutting corners and expanding too big. Kevin O. would want majority stake and would "whack the stuffed pie guy, he's an expense." He would also limit to one flavor, sweet potato pie. His sales would halve, but he would make a lot more money. He's out. Kevin H. also thinks that Tod has overstated the value of his business ($460K gets you 10%... that would mean that the business is worth $4.6M), so he's out. Barbara asks Daymond to help her out. She wants to go in for half for twice the equity, $230K for 20%. Daymond... would need 50% of the company. He also wants to see orders and records. ACCEPTED: $460,000 for 50% Next... OWNER: Darrin Johnson The project: Bluetooth implants... into your ear... via surgery. And the Sharks are SOOOOOO out. Barbara: "This is the weirdest damn thing I've ever heard." OWNER: Kevin Flannery; Cary, NC He has funded his business through mortgages on his home and has been forced to put it up because he can't keep up with his payments. It's important to him to keep his family safe. WiSpots is a patient interaction center that allows patients to take one of five interactive tablets, check in, take surveys, surf the web, and play games all for free. It also provides a revenue for the doctor, coming from media buyers, pharmaceutical companies, and ad buyers. The cost to install one of these babies: $9000, footed by the doctor. Robert wonders if there could possibly be another magical device that would allow end-users to check their e-mails anywhere they would like to... Wow. He's some kind of sorcerer or something. Kevin O thinks of his money as "soldiers". He send them out, takes prisoners, and they come back with more. Flannery's army gets sent out, and every soldier dies. He's out. Kevin H is not going to risk his money just to look at ads. He's out. Barbara's also out when she says that quitting takes more courage. Daymond is also out. Robert is conflicted. He says that he has to save his money so he won't have to put his family at risk. That said... he's out. Next... OWNER: Tiffany Krumins; Auburn, GA She's a nanny with an idea brought about by taking care of kids and now having one of her own. She worked with a child who had Down Syndrome, and taking his medicine would turn him from angel to devil in a matter of seconds. Enter Emmy, who dispenses the medicine with a loving "open wide" and "good job!" She's done a patent search, but currently has no patent. She wants to use the money to get a patent and a working prototype. Kevin O wonders how he can make money on this. He can't see himself making money on something so little... He's out. Robert thinks that she could've made the same pitch to a big company and make the sale. Daymond says that it's a great idea, but it's not a business. He's out. Kevin H. agrees. Barbara loves the idea and Tiffany, but it's "too rich". She wants 55% for the money. That sort of idea makes sense. Will Tiffany make the sale? The expertise is more than the money to her so... she takes it. ACCEPTED: $50,000 for 55%. Finally into the Tank this evening is... OWNER: Omar Solimon & Nick Friedman Inc. has named Omar and Nick among the top entrepreneurs under 30. Entrepreneur Magazine has named College Hunks Hauling Junk a top 30 franchise. So the question remains... why are they here? They netted $500,000 last year from the hunks, then another $3 million. Kevin O will not give money unless he's already getting money for the Hunks. He wants 51% for $250K for the whole package. It's the only offer that makes sense. The guys, though, think differently as they regroup and come back with a new offer for the whole banana... $1 million for 10%. To which Kevin O says.... "WHAT?! You will never ever get to this side of the table doing a deal like that. You know why you're wearing [pink] ties? You're pigs." They're being greedy. He's out with these words: "Never insult money." Daymond says that he feels uneasy with the girls and men in trenchcoats. He's out. Kevin H. is valuing the business as it exists today, while they're valuing the business in the future. He's out... and so is Barbara. That leaves Robert. He has a problem with quarter-million on a risk. SO... he makes an offer... He'll give the money for 50/50, but he wants 10% of the Hunks has well. The other Sharks approve of the deal. Omar & Nick.... pass on the offer. "Bad mistake. I think we're all out." One night and the sharks have pounced over only two out of the five deals presented. They're all business, literally. Back next week for more chum. To see this episode in its entirety, go to www.abc.com/primetime/sharktank. |
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