Second Guest: Chris Spencer, Hydromax 

Chris is convinced he can save lives with his product that helps kids stay hydrated when they are playing football. He works in Corporate America, and is justifiably worried about quitting his job to pursue his dreams.

Our Analysis:

• Presentation: He was very serious, believing that he could really save lives. That showed that he was very attached to the business, which can be both bad and good.
• Business Strengths: He had great market traction in 2007, and is committed.
• Business Weaknesses:. Not enough time from the business owner, and the product has been idle for several years – that means he wasn’t making very much money even on $100,000 in sales.
• The Deal: He asked for $50,000 for 25%. Jeff countered with $50,000 for $50 and he took the deal.
• Sharks: They were all respectfully out but Jeff, who made a nice deal. We think he partially did it because it is consistent with his branding around kids, and he is well connected to the kids’ marketplace.

• Make the calls and get the distribution deals!

• Partner with someone who shares your passion and where both brands are enhanced by the relationship.
• Take care of your family first.  We really respect him for doing that!

• You can find out more at www.hydromaxsystem.com. I couldn’t find out how to buy it online, even after clicking on the link provided, which makes me think the deal was never consummated.

First Guest: Les Cookson, Carsik Bib

Les was sick of cleaning up after his sick kids, so he invented a vomit catcher.

 

It started out repulsively with a rather large demonstration of the effect of a child vomiting, made all too real with split pea coup and kernel corn. It went all over the floor and made a huge mess.

 

Carsik Bib to the rescue! Looking more like a feedbag, the bib catches your precious child’s stomach contents before they can soil the car, the clothes, and in this case, the studio floor.

 

The sharks almost rolled on the floor with laughter, except that was covered with throw-up. Jeff delivered a great line in “I have a hard time listening to you once you are standing in vomit”.

 

And the prototypes were made from plastic bags, shower curtains, and maxi-pads. Ingenious.

 

But he has traction! He has sold 160 of them and has invested $1,300 of his own money.

 

Daymond was out immediately. Kevin O said that an investment in barf bags would not look good in his portfolio and he was out. Jeff was worried about liability, as were Barbara and Robert. All out. No deal.

 

Note: One thing no one mentioned, at least on the air, was that the kid might just decide to play in their own vomit and rip the darn thing off their neck. I’m not sure that this would really avoid too many messes.

 

Our Analysis:

•  Presentation: He was confident. The simulated vomit was way over the top, and didn’t help him create an image as a successful business person.
• Business Strengths: There are certainly a lot of kids who get car sick!
•  Business Weaknesses:. The solution was a bit repulsive (a bag of vomit hanging around your kids neck!) and not protected. A large player could easily copy the idea.
• The Deal: He asked for $30,000 for 15%. He got no counter-offers and no deal. My guess is that he would have negotiated a lot, but didn’t get the chance.
• Sharks: They laughed a lot and got out quickly.

Next Step Suggestions:

• Focus on IP protection. If he can patent it, he can license it. Going to market as a single product company with no protection is very risky.

Lessons:

• Intellectual property protection is key (in this case, a patent and a trademark). This idea could be copied by large suppliers, and the business would be dead.

Follow-up:

• You can find out more at www.carsikbib.com. They are now orange and sell six for $10, plus $7 shipping.
• Curiously, you can buy an 18 pack for $40, which is three times as much product for four times the cost, which is very unusual pricing indeed.

(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com) 

Fourth Guest: Shane Pannell, Sweep Easy  

Heads-up – this was the best session ever!

Kevin H said he was the better partner because they would make $millions more over time. Barbara advised him to slow down and think. Robert wanted to partner with Kevin O, and then Daymond wanted to partner with Kevin H. What fun!

• Presentation: Shane was charming and innocent. He was out of his league negotiating with the sharks, and looked like he was going to pass out.
• Business Strengths: It was a great idea, and patented. The sharks loved it, and that was good enough for me.
• Business Weaknesses: There is some risk because of no market traction, but they sharks loved it anyway.
• The Deal: Shane wanted $50,000 for 25%. He got a bundle of counter-offers (watch the show!), and ended up taking $80,000 for 40%.
• Sharks: They were very sharky to each other, (a feeding frenzy!) but not necessarily to Shane. This was a great episode!

• Do the infomercial thing with Kevin H.

• Be careful when you step in Shark Tank. They have very strong personalities and are not averse to personal attacks.
• Marketing talent (Kevin H and Daymond) can provide a better partnership than just money and connections.

• You can get more at www.SweepEasy.com. Frankly, it doesn’t look like he ever got financed, and he promises the be in production soon. You can’t order one yet.

Third Guest: Kim Nelson, Daisy Cakes

Kim makes cakes with recipes that have been passed downed through the generations in her family. They put a lot of “southern love” in every bite, and ship them nationwide. They are selling a lot, but need money to expand and stop making the cakes by hand, by themselves. Kim wants everyone in the country (on the planet?) to be eating her cakes!

Barbara likes Kim and thinks the business is too small. She made a counter-offer of getting $1 back on every cake, so she gets her money back soon, with the condition that mom goes with her and the money is used for trade shows. Kim took the deal!

• Presentation: She was charming and cute, in contrast with the first presenter, who was also cute but not so charming. She was open to advice and seemed like a great person to work with.
• Business Strengths: The cakes tasted great! And the story (family recipes, passed down through the generations) is a good one.
• Business Weaknesses:. Scalability is an issue, as is differentiation in the mind of the consumer. How can I tell how good the cakes are without tasting them?
• The Deal: She wanted $50,000 for 25%. She got it, with a royalty clause back to Barbara.
• Sharks: They were down right charming themselves. Even Kevin O!

• Listen to Barbara; focus on the trade show circuit and celebrity endorsements.

• Scalability is a big deal. Some business will work very well on a small scale, but not on a large scale.
• Investors want to play the game of growing your business with you. Be a good partner and let them play.

• You can learn more about them a http://www.ilovedaisycakes.com/.  Nice website!.