This latest episode of Shark Tank was a special one, because In The Shark Tank was invited to a viewing party by one of the episode’s businesses, LuminAID. We watched the segment in a packed house, and even attended a Q&A with the founders just after their segment aired. In case you missed all of the action in the Shark Tank, here’s how it all went down.
First into the Shark Tank were Anna Stork and Andrea Shreshta, the women behind LuminAID. Andrea and Anna asked the Sharks for a $200,000 investment in exchange for 10% equity in their company. The women were studying architecture in 2010 when the Haiti earthquake rocked the island, leaving immeasurable damage in its wake. Andrea and Anna realized there wasn’t any type of product on the market that could easily provide a source of light to disaster victims, and they started to prototype LuminAID. LuminAID is a solar-powered inflatable light, shaped like a pillow, that has 2 brightness settings and latest up to 16 hours. LuminAID sold $250,000 in its first year, and over a million dollars in the last 12 months. The women currently sell to individuals direct online, to wholesale/retail/commercial outlets, and to NGOs and government agencies for use in disaster relief. Each LuminAID costs $4.75 to manufacture and is sold for $19.95 retail. Up until this point, LuminAID has been funded by Andrea and Anna’s start up funds ($15,000 total), a successful crowd-funding campaign, and $195,000 they’ve earned from competing in and winning numerous business plan competitions. The Sharks seem to love the product, as well as the women’s clear understanding of their product and their numbers. Kevin makes the first offer of $200,000 in exchange for a 4% royalty until he recoups $800,000. Daymond makes the next offer of $300,000 for 20% equity, and says he plans to license the product. Lori comes in next, saying that “this product will change the world” and makes an offer of $200,000 for 20%. Next, Mark makes and offer of $200,000 for 15%, and he wants the option to lead the next round of financing at $300,000, as a sign of proof to the women that he can offer them a foundation to grow from. Robert comes in last at $200,000 for 15%. When the ladies ask to step out, Kevin sagely advises them not to “leave the tank at this juncture,” so their quickly consult in the tank. With five offers on the table, it’s Mark whose offer stands out, and the deal is made!
Earlier in Season 6, Shark Tank fans met Bottle Breacher, who made a deal with Kevin and Mark for their bottle opener company. The company received 60,000 in orders in just their first week after the show, which meant having to immediately scale production from manufacturing 175 units a day, to over 1,000 units a day. The company went from $500,000 in pre-Shark Tank sales to over $2.5 million in sales in just 3 months. Congrats team!
Next up in the Shark Tank are VA Tech alums Jack DuFour and Alley Heffern, representing their company Taaluma Totes. The duo asked the Sharks for $110K in exchange for 15% of their company. Taaluma Toes began when Jack and Alley travelled to Uganda during a summer break and were inspired by the bright and vibrant fabrics for sale. They now sell backpacks paired with country, with a portion of the sales from each bag financing a micro-loan for someone from the country of origin. Then, when the micro loan is repaid, the loan repayment money is invested back into the company to purchase more fabric. In just 10 months the two have racked up $60,000 in sales, which has funded $6,000 in micro loans. The bags aren’t manufactured overseas through, but instead in a facility outside of Richmond, VA that employs adults with disabilities. Each bag costs $27 to make and is sold for $65. The Sharks all agree that it’s too early for the company to be investable, and that the duo must first better learn the ins and outs of their own business before gaining investors. With that Alley and Jack leave the tank without a deal.
Third into the Shark Tank are Ryan Fant and Nayeem Hussain, two friends who met while studying for their MBA at NYU School of Buiness. The guys are asking the Sharks for a $750,000 in exchange for 10% equity in their company, Keen Home. Keen Home sells smart vents that automatically connect to the internet and allow users to regular vent air flow in their home using a smartphone app. The guys say that the vents will help homeowners significantly reduce their heating/cooling energy usage, by installing 4-6 vents into their home at a cost of $80/vent. To date, Keen Home has been funded by $50,000 in personal investments from Ryan and Nayeem, money raised through grants and funding programs, and a $1.5 million seed round. The Sharks are wondering what justifies the increased valuation since their seed investment round, and the guys mention that they’ve pre-sold 35,000 units to Lowe’s in a 2-year home improvement channel exclusivity deal. Despite being pre-sales, the Sharks see potential in Keen Home and Kevin makes the first offer of $750,000 for 25%. Daymond matches that offer, and also wants to manufacture the goods himself if he can match or beat their current manufacturing costs. Robert comes in next at $750,000 for 20%, but the guys aren’t willing to entertain a “down round” at a lower valuation than their previous investment round. Kevin offers to solve the problem by offering them debt through a $750,000 loan at 8.5% interest and 36 month term, along with 10% equity. Lori then joins Kevin’s offer. Robert remedies the down round problem by amending his offer to $750,000 for 13%, and Daymond decreases his equity to 20%. Reasoning that they’re looking for an all-in partner, the guys take Robert’s offer. Deal!
Last in the Shark Tank is Christopher Grey, founder of Scholly, who asks the Sharks for a $40,000 investment in exchange for 15% equity in his company. Scholly is a mobile app that costs $0.99 to download, which pads students with hundreds of scholarships they qualify for. The scholarships are curated through a database that was built manually, and Christopher runs the company with two cofounders who are app and web developers. Christopher is well-acquainted with the scholarship process, after winning $1.3 million in scholarships during his own college application process. His interest in the field comes out of necessity, as he was raised by a single mother and even scraping together the fees to apply to colleges was a challenge. Early in the negotiations, Lori makes an offer of $40,000 for 15%, with a persuasive speech about her belief in Christopher and his mission. Daymond follows up with the same offer, recalling his own story of being raised by a single mother and having to work from a young age to support his family. Mark and Robert attempt to interject with questions about the database and scholarship sourcing algorithms, but they’re repeatedly cut off by Lori and Daymond’s pleas to Christopher to take their offers. As Robert and Mark become increasingly frustrated, Daymond and Lori agree to combine into a single offer of $40,000 for 15%, and Christopher takes the deal. After Christopher leaves the room, Robert sparks a heated conversation back in the Shark Tank by accusing Lori and Daymond of making the offer only because they felt bad for Christopher. Mark and Robert become increasingly irritated over their inability to ask questions of Christopher while he was in the tank, but Lori says they’re being “sour grapes” over a fair deal that she and Daymond made.
Whew— some heated moments at the end of that one, fans! Let us know what Shark’s side you were on in the comments.