Seriously Saving Lives (Episode 2.6)
by Shark Tank TV Show on Tuesday, May 3rd, 2011 | No Comments
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.He is looking for $50,000 for 25% of his company, a pre-money valuation of $150,000.
Hydromax is a fluid delivery system that mounts to a child’s shoulder pads and allows him to get a drink on the field, whenever he likes, sucking fluid through a tube that comes around to the front.
He basically has taken the concept of a Camelbak and mounted it on shoulder pads, but somehow has a patent on it.
He had sales in 2007 ($100,000) when he was single, but then got married. He chose to let the business go and focus on his family.
Kevin O said that this was a licensing deal (and we think he was right), and he was out. Daymond thought the valuation was too high, Barbara didn’t have the necessary connections, and both were out.
Robert though it was clever, but thought that Chris was wanting to avoid hard work. He told him to make some sales calls, and was out.
Jeff wondered if it has been game tested – and the answer was yes. He offered $50,000 for 50% (which surprised me). He is all about kids, and sees that moms across America will want it for their kids.
Chris, being smarter than a fifth-grader, took the deal! He was delighted.
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.
Next Step Suggestions:
- Make the calls and get the distribution deals!
Lessons:
- 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!
Follow-up:
- 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.
(If you are interested in raising capital for your business, visit us at www.AngelNetwork.com)
