Do you know how to handle all of the legal documents for your business? Do you know how to make sure you are able to legally comply with the law for your company? Angel Money Boot Camp is going to give you step by step instructions on how to structure all of the legal issues within your business. Angel Money & Crowd Funding Boot Camp is happening soon, so go get registered for an early bird special! This boot camp is all about bringing entrepreneurs to a place where they can get funded, develop their product, and grow their business like crazy. So what are you waiting for!?
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]]>How to pitch to investors is crucial to your success when raising capital. The sharks are out there and are eagerly awaiting your company… are you prepared? Angel Money & Crowd Funding Boot Camp is an event that is here to help give you the tools and resources, helping you learn how to raise money. This boot camp is all about bringing entrepreneurs to a place where they can get funded, develop their product, and grow their business like crazy. So what are you waiting for!?
Click HERE to see more about how to structure your business!
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How to talk about money is essential when preparing to pitch your company. If you are looking to raise capital you need to make sure you are prepared to speak using the language of money. Angel Money & Crowd Funding Boot Camp is an event that is here to help give you the tools and resources, helping you learn how to raise money. So what are you waiting for!?
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]]>How to value a company can make or break you as an entrepreneur, if you have the right people to help you along the way it can make a world of difference in your business. Angel Money & Crowd Funding Boot Camp is an event that is here to help give you the tools and resources, helping you learn how to raise money. So what are you waiting for!?
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]]>How to raise money is something EVERYONE should learn, if you have the right people to help you along the way it can make a world of difference in your business. Angel Money & Crowd Funding Boot Camp is an event that is here to help give you the tools and resources, helping you learn how to raise money. So what are you waiting for!?
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Dominique bought the same shoe in several colors a few years ago, and thought that there must be a better way. So she invented an innovative concept in shoes: one sole with many tops.
She was seeking $500,000 for a 20% stake, a pre-money valuation of $2,000,000.
As she pointed out, the concept of interchangeable tops is great for the travelling women – now she can pack one shoe with a bunch of tops and save a lot of space.
She invited Barbara to try them out, and she loved them. (Good thing, because her feet were killing her.)
The shoes sell retail from $70 to $85. The tops are separate and sell from $12 to $30.
She has had $20,000,000 in sales in the last four years, and is in 2,000 stores in 30 countries. Last year, sales were down at “only” $3.5 million. She has been on QVC six times. Her profits last year were over $1,000,000.
Her margins are good, and she has two utility patents and two design patents issued, with more on the way. She is trademarked and copyrighted in 98 countries.
She wants an investor to help her with sourcing. She is a pharmacist by profession, and started the business as a hobby. Now, she knows she needs a partner to take it to the next level. She is still running a pharmacy out of the shoe warehouse.
Robert pointed out that she was selling herself short. Many business owners with far less success exude in confidence, but she didn’t think of herself as a business person. She was under-confident, which is rare and quite refreshing.
She wants the funding to fill the big orders she already has – she needs it for inventory. She has lots of demand of which she can’t take advantage.
Robert suggested that all of the sharks go in for $100,000 each for a total of $500,000 for 50%. Interesting!Daymond said he didn’t need any partners, and would give her $500,000 for 35%.
Barbara said it would take to much of her time, and she was out.
Kevin O suggested $500,000 for 51%. He would immediately sell the company and make her rich. She didn’t want to do that.
Kevin H wanted to partner with Robert – $250,000 each for 50%.
She took Daymond’s offer and was ecstatic!
Our Analysis:
- Presentation: She was very poised and professional, befitting of the CEO of a $20,000,000 company, but also sold herself a little short.
- Business Strengths: She has a great concept, and great sales. She has good margins and good intellectual property protection. This appears to be a big winner.
- Business Weaknesses: She needs partners in sourcing (manufacturing) and distribution to take her business to an even larger market. It was very unusual for her not to be focusing on the business full-time.
- The Deal: She asked for $500,000 for 20%. Robert countered with $500,000 for 50% with all the other sharks. After a little more negotiating, she took Daymond’s offer of $500,000 for 35%, and we think it was the right thing to do.
- Sharks: They were very respectful, except of course for Robert, who we think was just trying to live down to his reputation.
Next Step Suggestions:
- Leverage Daymond’s fashion industry savvy to take the company global, and very large.
Lessons:
- At each stage of your business growth, seek new partners who can help you take it to the next level.
Follow-up:
- You can find out more at http://www.onesole.com/. The product line is very impressive, but the website needs to be redone.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)
Aldo is an artist from Mexico City, now living in Chicago. He wants to bring his jewelry to a bigger market and inspire other artists with his success.He was looking for $180,000 in exchange for 45% of his business, a pre-money valuation of $220,000.
His jewelry art is very exclusive; his clients include the very wealthy, celebrities, and royalty. His inspiration is on mythology from many cultures. He wants to encourage awakening and awareness.
Aldo wants to take his products to a mass market and has created a new line to do that. He has an offer from QVC that he wants to take advantage of, but needs the funding to do so.
Kevin O noted that “he was the business”, and there was a tremendous risk in doing business with a “one man show”. He was also concerned that it was tough to take a premium brand down-market.
Daymond noted that no one was buying jewelry right now, and that it wasn’t a good time to invest in that industry. He as out.
Kevin H noted that there is a huge difference between making unique one of a kind products and products for the mass market.
Kevin O couldn’t get over him as a one-man business, and was out. Robert thought the price-point was too high, and he was out.
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Barbara really liked him and his style, and offered to put up half the money.Kevin H was on the fence, but he knows QVC and wants to leverage the brand. He was in for the other half with Barbara!
Done deal!
Our Analysis:
- Presentation: He was poised and focused, and did a good job representing himself. He seemed like a very passionate and successful artist.
- Business Strengths: He has built a great clientele and a good brand for himself.
- Business Weaknesses: The business is totally dependent on Alto. If he is unavailable for any reason, the business dies. And the business depends on a strong economy, and we don’t have one right now.
- The Deal: He asked for $180,000 for 45% of the company and got it! Barbara and Kevin split the deal.
- Sharks: They were very professional. Kevin O wasn’t nearly as rude as he usually is.
Next Step Suggestions:
- Use the money and Kevin’s knowledge and connections to leverage the QVC channel.
Lessons:
- There is great power in a brand that is sold to celebrities and you can say so.
Follow-up:
- You can find out more at http://www.aojewelry.com/. There aren’t a lot of products to purchase, but we did notice a charming little bracelet for $4,500.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)
Second Guest: Kim Preis, Samson Martin
All of Kim’s girlfriends were pregnant at the same time and they were always being asked the same question: “When are you due?”. So she created a specialty clothing line that carries messages such as “Due in the fall” or “Due this April”.She positioned her line in up-scale boutiques, but now wants to reposition the line and take it to mass retail. She wants contacts and money to expand the brand.
Kim was seeking $50,000 for a 15% share in the business, a pre-money valuation of $283,333.
She sold $90,000 last year, and has been in business 6 years. At her peak, she sold $400,000 per year. She has a trademark on the “due in…” line.
Kevin O said the market wasn’t very big, and that concerned him. Robert liked the fact that this was a niche product, but was concerned over the company’s ability to be “hot twice”.
Barbara echoed that it was a forced market, too – pregnant women have to buy new clothes.
Robert was concerned that she hasn’t made the calls to the big box stores so far, wondering what has stopped her from doing so.
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Daymond was concerned that the market was down right now. He thinks the environment is poor, and doesn’t want to invest in another fashion brand.Kevin H was concerned over the number of SKUs. It was too complex for him and he was out.
Barbara has seen other shirts with just the word “January” or “June”; she wasn’t sold on the value of the “due in” brand and was out.
Robert wasn’t up to fighting the battle of growing a company again and was out.
Kevin O was the last hope, and really didn’t care about the success in earlier years. He called it the T-Shirt deal from hell (with a lot of good reasons), and he was out. He was unnecessarily very rude, which is his style.
All out, no deal.
Our Analysis:
- Presentation: She was poised and well spoken. And very disappointed. But she was polite and said “thank you” anyway.
- Business Strengths: She had a good company before the recession, and has established the brand in many outlets.
- Business Weaknesses:. The IP was not strong, and her sales fell excessively (75%) during the recession. That makes me think there are other factors at play, such as the emergence of strong competition.
- The Deal: She asked for $50,000 for 15%. She got no counter-offers and no deal.
- Sharks: Robert was totally rude and obnoxious. He really makes the other sharks seem very professional.
Next Step Suggestions:
- I think going down-market is a mistake. I suggest she try to grow organically again, and perhaps offer some complementary products.
Lessons:
- Sales are everything.
- It can be very difficult to convince investors that they will rise again once they have fallen.
Follow-up:
- You can find out more at http://samsonmartin.com/. She has a small line, and it doesn’t look like she received funding from other sources. But she has expanded with a couple of new lines: one for new mothers and another for the kids.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)
First Guest: Rebecca Rescate, Citikitty
Rebecca is focused on helping cat lovers everywhere. She was living in a tiny apartment, and needed a way to eliminate the smells from the litter box.She was seeking $100,000 for a 15% stake in her company, a pre-money valuation of $566,667. She wants to money for marketing and for hiring staff.
This is a big market – there are 200 million cat owners around the world, and cleaning up after the cats can be, well, a crappy job.
So she has invented a way to train cats to use the toilet! No more litter boxes! Life at home is better for the cats and their families.
It works really well – cats soon realize that the water of the toilet covers the scent of their waste, and they adapt very well.
The initial reaction was that the sharks didn’t want to share their toilet with their cat!
But down to business: CitiKitty sells for $29.99, costs $4.66 to make in quantities of 10,000, and she has sold 40,000 off her website alone. She has sold $1.4 million in these kits and she has never advertised. She has had some good exposure on Good Morning America and CNN and other programs.
Robert was not interested in the business and was not a cat person. He was out. Kevin O hates cats (and many humans, we might add), so he was out.
Kevin H looks for products that solve problems and have a big market – and this does both. He countered with $100,000 for 40%.
Daymond thinks that Kevin H was a better partner and was out.Barbara said her partner “As Seen on TV” would love the product, and she would take the original offer; but there was an issue – she was only going to do it if her partner said yes.
Kevin O summed it up: with certainty, she had an offer to sell 40% for $100,000 with a great partner, or a chance to sell only 15% for $100,000 with a riskier deal.
She countered with $100,000 for 20%, Kevin’s final offer was $100,000 for 25%. Barbara pulled the “you should do business with a woman” card. And she sweetened the deal to have no contingencies.
Rebecca liked the offer but looked Kevin in the eye and said “$100,000” for 20%, and he said “yes”! Wow! Barbara was bummed she didn’t get the deal.
Our Analysis:
- Presentation: She was very strong, poised, and polished. And it turned out that she was a fantastic negotiator.
- Business Strengths: She has great market traction, and the market is very large. I think she also has a compelling value proposition.
- Business Weaknesses:. None that I could see. There is a lot of competition in the kitty litter business, but very little (none?) in the cat toilet training business.
- The Deal: She asked for $100,000 for 15%; Kevin H offered $100,000 for 40%, and ended up with $100,000 for 20%.
- Sharks: Kevin O was his usual obnoxious self, and I was not surprised to learn that he hated cats. Kevin and Barbara did a little sparring over the deal, which put Rebecca in a a great position, and she took advantage of it.
Next Step Suggestions:
- Let Kevin H do his magic! I think this is going to sell a bundle.
Lessons:
- In this crowd, market traction is everything.
- A bidding war between potential partners can be a very good thing!
Follow-up:
- You can find out more at www.CitiKitty.com. This is a very good selling website! And she has complementary products to increase her sales and lifetime value of the customer.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)
Fourth Guest: Jeff Stroope, Hyconn LLC
Jeff is a full-time captain of a fire brigade and in charge of maintenance. He realized that it was taking way to long to get water to the scene of a fire, so he created a product that will revolutionize the fire safety industry.He has invested 11 years of his life on the project and he cannot let it fail.
Jeff was seeking $500,000 for a 40% stake, a pre-money valuation of $750,000.
Hyconn is a patented rapid connect and disconnect system for hoses. In the demonstration, it seemed to save 15 seconds on connection, and less than that in disconnecting. My first reaction was that the difference wasn’t that big.
Robert and Barbara picked this up right away, but, surprisingly, he is selling them to other fire departments with a very high closure rate per sales call. He is selling locally in Arkansas, so it is tough to tell whether folks in other states will make such positive decisions.
Kevin O doesn’t like the idea of selling to the government because they don’t have budgets. Barbara agreed.
Robert suggested that it would be cool to get some sort of “required” status that mandated usage. Jeff is working on that.
He has tried to work with distributors, and they have agreed to put it into their line. Daymond didn’t like the idea that they were asking him to put up the money, so he was out.
Barbara didn’t like the 8-second savings, and was out.
Robert suggested that there might be other markets, such as oil and gas and home use and – wow! – he had already developed the residential / light commercial version. Cool!
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He hasn’t been marketing the residential version because he has been focusing on the fire-fighting market. Kevin O says it may only take a few calls to talk to all of the big hose manufacturers.Mark surprised me and the other sharks by offering him $1.25 for the company and a three-year employment agreement at $100,000 to run the show. Wow! And he would pay him a percent of the profits once they hit agreed upon numbers.
Kevin O called that “madness”. He just wanted 100% of the garden hose business for $500,000, and he would also pay a royalty of 3%.
That’s when Kevin O and Mark got a little “sharky” with each other and really began competing for the deal. The word “pahooey” came up at least once.
Robert said he was going to make an offer similar to Mark, but wasn’t going to be that generous. He was out.
Mark sweetened the deal to 7.5% of the royalty and Jeff took it!
Our Analysis:
- Presentation: He was very convincing and authentic. I really wanted to work with him right away. The professional firefighters at his side were a nice touch.
- Business Strengths: There are a lot of hoses out there! And the residential market is huge.
- Business Weaknesses:. The only weakness I saw was Jeff’s focus on the fire-fighting market. And that ended with the deal and the dual focus on the residential market.
- The Deal: He asked for $500,000 for a 40% stake. Kevin O offered $500,000 for the residential business alone, and Mark offered $1.25 million for the whole business. Jeff and Mark made the deal.
- Sharks: They really got testy with each other. I think Kevin O and Mark are perfect for each other – both of them are rude and aggressive.
Next Step Suggestions:
- Focus on building the business through licensing deals with major hose manufacturers.
Lessons:
- Intellectual property is very valuable.
- Bidding wars are great for those who are selling!
Follow-up:
- You can find out more at http://www.hy-conn.com/. The home edition is only $19.99, including shipping and handling.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)