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00:00Ten years in the making.
00:02You're ready?
00:03Shark Tank is for anyone who dares to dream.
00:06I've seen all my clients go out and make millions of dollars,
00:09and I'm like, man, I should do that myself.
00:11The risk takers.
00:12I've put in almost one million dollars.
00:15We decided to sell our house.
00:18We moved into a camper.
00:19We lived in a camper for ten years.
00:20Are you kidding?
00:21The innovators.
00:22It's really cool.
00:23The pioneers.
00:24The doers.
00:25This will be a generation-defining game.
00:27And those with zero quit.
00:29I've brought this to almost five million dollars in sales.
00:32I know I come off as maybe a kind of unassuming guy,
00:35but I'm an animal.
00:36I get stuff done.
00:38I love that entrepreneurial drive,
00:40and I live it every day.
00:41This season, we have exciting new guest sharks.
00:45Todd Graves, the founder of fast-dining phenomenon,
00:48Raising Canes.
00:50Jamie Kern Lima, creator of smash-hit makeup brand,
00:53It Cosmetics, which sold to L'Oreal for $1.2 billion.
00:58And tonight, venture capitalist and limited partner of the Atlanta Falcons,
01:02Rashawn Williams, joins the tank.
01:04I was an early investor in Coinbase.
01:06Robin Hood, Rain, Casper.
01:07If I invest in this, this thing is going to catch fire.
01:12The power of the tank is to take the story and amplify it geometrically.
01:17Some will stumble.
01:19This was a failure.
01:20But failures can be the seeds of your success.
01:22Some will soar.
01:24I actually quit my job last week.
01:25Wow.
01:26How good did that feel?
01:27It felt good.
01:28That's the American dream.
01:29I want to get a deal.
01:31I don't want to mess around.
01:32You're in the shark tank.
01:33We care if you can make money.
01:35A brand new season begins now.
01:40We are not leaving the tank without a deal.
01:42Are you kidding me right now?
01:44That was exhilarating.
01:46You better watch out, buddy, because the teeth are coming out.
01:49Why are we wasting our time?
01:51You have no idea what you're doing.
01:53You're so immune, Kevin.
01:54What other country can you build what you've built?
01:57America is still the best country in the world.
02:01I think you've got the whole package.
02:02This could be our biggest deal ever.
02:04It should be painful.
02:05We made it all the way to shark tank.
02:07Yeah, baby.
02:08We're going to take you to the moon.
02:18First in the tank is a healthier way to take the edge off.
02:22Hello, Sharks.
02:32I'm Megan Klein from Miami, Florida.
02:35Yeah.
02:35I'm seeking $500,000 for 5% of my company, Little Saints.
02:41Sharks.
02:42Very far from a teetotaler, I have always loved a good cocktail.
02:46Back when I was a lawyer, I was your classic work hard, play hard.
02:49During the day, I exercised, ate healthy, and worked really hard.
02:54And at night, I rewarded myself with cocktails.
02:56I always loved drinking and socializing, but after a while, it really started to make me feel terrible.
03:02But I'm a partier.
03:04I never wanted to stop drinking.
03:05I just wanted to drink something that was better than alcohol.
03:09And that's why I created Little Saints, non-alcoholic cocktails and spirits fueled by functional mushrooms
03:14so that I didn't have to choose between having fun and feeling good.
03:18And that's why I modeled Little Saints after my favorite cocktails like espresso martini and spicy margarita,
03:25which are beloved by even the most discerning bartenders for their sophisticated taste and smell.
03:31Little Saints are sugar-free, only 5 calories per serving, and boosted by functional mushrooms like reishi and lion's mane.
03:39So, which one of you sharks wants to join me on my mission to radically transform the way that we drink with Little Saints?
03:48Woo!
03:48All right, let's drink.
03:49So, on your left, the shortest glass, that is our number one top-selling can.
03:55That's a Paloma.
03:56This is actually pretty good.
03:58That is very good.
03:59Yeah, that is good.
03:59It's tasty.
04:00We use two different kinds of mushrooms that make you feel something.
04:03The mushroom in the Paloma that you just drink and in that espresso martini, that's a reishi mushroom.
04:09If you have a whole can of that, it'll give you that, like, take-the-edge-off feeling.
04:12It's especially pronounced if you have, like, a stressful day.
04:15Okay.
04:15Ow!
04:16I know, Mark.
04:17I'm having...
04:18That's not my kind of taste.
04:19Yeah, that's not my kind of taste.
04:21I love it.
04:22I love it.
04:23I already knew I was going to like this.
04:24These are non-psychedelic mushrooms.
04:26Thank you very much.
04:27They are non-psychedelic mushrooms.
04:28They do not get you high.
04:29Megan, I'm a member of the mushroom community, and I invest in it.
04:33Lies, Maine, has really taken off lately.
04:35Non-psychedelic, but a lot of very interesting medicinal metrics around it.
04:40Tell us about the business, because you're saying this thing is worth $10 million.
04:44Absolutely.
04:45How many of these drinks have you had before you got out here?
04:49Kevin, I'm going to tell you about the sales,
04:50but I would love to tell you about my story first.
04:52Yes.
04:53So I graduated from college and law school with honors.
04:56I practiced as an attorney in New York before...
04:58Good for you.
04:59...I pivoted into pursuing my dream of becoming an entrepreneur.
05:02So this is not my first rodeo.
05:04I ran a hydroponic basil farm.
05:06I love that.
05:07I then started a national plant-based salad dressing and dip brand.
05:11Got my Kellogg MBA while I was running the plant-based foods brand.
05:15So anyways, I had savings, and so that's why I started Little Saints on my own.
05:20How much did you put in?
05:21I put in a million dollars overall.
05:23Oh, you're all in on that.
05:25Hey.
05:25Hello.
05:26And then I raised $2.2 million in outside capital.
05:30What valuation?
05:31$6 million, and then the last one was $9 million.
05:34But that was in October 2023.
05:37We've grown 600% since then.
05:39So 600% is how much?
05:42So we've done $5 million in the last 12 months.
05:46In sales?
05:46Really?
05:46In sales.
05:47Yeah.
05:48Tell us, do you have any debt on this company?
05:50We have a line of credit.
05:51How much?
05:51We have a $650,000 line, and I have $500 drawn on it.
05:55I have, I'll just tell you, I have $200,000 in the bank, and I have $600,000 in receivables.
06:00$200,000 cash in?
06:01So you're kind of close then right now.
06:02We're only burning $30,000 a month.
06:04So what did you spend the money on then?
06:06Well, so.
06:07Marketing.
06:07Story, or?
06:08Listen, so I made a lot of mistakes before we figured out how to get it right.
06:11We realized that, like, the only way to reach the people that actually wanted the non-alcoholic
06:16drinks was to just pivot and become a D2C company, and that's what we did.
06:19So 2022, when we only did $500,000 in sales, we lost $1.1 million.
06:24Okay, so that was a disaster area.
06:26And then 2024, we have done $4 million in sales, and we have only lost, like, almost $160,000.
06:33A little less than $160,000.
06:34There we go.
06:35Yeah.
06:36What's your best seller?
06:38The St. Ember, the bottled spirit.
06:40And how much does it sell for?
06:41The bottled spirit sells for $49.99.
06:44Damn.
06:44That's low.
06:45And what does it cost you to make?
06:47It costs $7, and with shipping, all the fulfillment cost boxes, all that stuff, it costs $23.
06:54So do you know what your CAC is and your ROAS?
06:56Yeah, of course.
06:56Our CAC is $42.
06:58It's a Kellogg MBA right here you're talking to.
07:00Our CAC is $42, and our ROAS is above $2.5 for the year.
07:04And then the long-term value of that customer is about $160.
07:06So you have a four times LTV to CAC, which is amazing.
07:11When do you see cash flow break-even?
07:13Probably you four...
07:14This month.
07:14I got it.
07:15Yeah.
07:16Look, I know this space very well.
07:17I know this industry.
07:18And what I know better than this industry is a good founder when I see one.
07:22I think you're a great founder.
07:23I'm not even worried about whatever I ask.
07:25You're going to give me a very straight answer.
07:26You pivoted.
07:27You figured out DTC.
07:28Love it.
07:29The traction you have is amazing.
07:30The industry is amazing.
07:31So what I would like to do, I will give you your $500,000.
07:36I want 10%.
07:36Hello.
07:40That's one times my actual sales in the past year, and I just hit profitability in the
07:46past quarter.
07:47Thank you for the offer.
07:48I love it.
07:49I think it's a great deal.
07:50It's a $5 million valuation.
07:51Would you be willing to...
07:56I wouldn't have to raise again if you gave me $500,000 for 5% of my company, and I had
08:05access to a $2 million line of credit, for which I would, of course, pay you interest.
08:11But that's not what he wants.
08:12I know.
08:13That's my counter.
08:15You're asking for more, or you're giving me less.
08:16All sharks are still in.
08:30Rashaun has offered $500,000 for 10% of Megan's non-alcoholic cocktail company, Little Saints.
08:37But she has countered with a bigger ask than what she initially offered.
08:41You thought you were going to come in here, and you're just going to be giving you exactly
08:44what you want?
08:44No, she wants more now, too.
08:47I just want to point something out.
08:49There's investment, and then there's Shark Tank investment with the aura of Shark Tank and
08:53the $100 million eyeballs in syndication.
08:55You think that's free?
08:57Listen, first of all, I love the kind of woman that when her feet hit the ground in the morning,
09:03the competition says, oh, crap, she's up.
09:05Okay?
09:06And you're that kind of woman, I think.
09:07Mm-hmm.
09:08But I can't really participate in the drinks so much.
09:11I don't really do sour drinks.
09:14I can't really eat citrusy things.
09:17When I do a deal, I want to have the passion for the person, which I have here, but I need
09:21to have the passion for the product, too, and participate in it.
09:25I wish you really good luck, but I have to be out.
09:28Thank you, Lori.
09:29Your valuation is way too high.
09:32I think that is my biggest challenge, because you're finding growth, and I love it, but
09:37it's just not for me.
09:39I'm out.
09:41But it tastes good.
09:42Yeah, Megan, here, I just don't do medicinals because there's just no barriers to entry other
09:47than how much capital you invest to market it, and there's always going to be somebody
09:51willing to spend more.
09:52Mark, may I interrupt you really quick?
09:53Sure.
09:53I just want to make sure that it's not a medicinal.
09:56There's no, the mushrooms in here are FDA gross.
09:58No, I get that, right?
09:59It's just people who are buying it aren't buying it to drink it like water, so for those
10:04reasons, I'm out.
10:05But congratulations on what you've accomplished.
10:07I think it's great.
10:08Megan, great presentation.
10:09I know the category because I'm in the wine business.
10:12I actually had an offer for you, but it's pointless at this point because you're having
10:15a hard time at 10%.
10:17I was going to do it for 15 because I have millions of followers that buy my wine, and
10:22so many of them are going into that journey of looking for alternatives for alcohol.
10:27What if I went in with Rashawn and we said, look, we'll both come in, but we want 15%?
10:32Yep, I'll do that.
10:33And you get two sharks and the whole machine we both have.
10:36And Megan, I'm on a winning streak in beverages.
10:39That's why I'm so confident about this.
10:40If you get your revenue to $50 million, you can sell this business for four to six times
10:44revenue.
10:45You can get there faster with us.
10:47It's just a choice.
10:48What do you want to do?
10:49I want to get the value that I've worked and my team's really worked hard for, and
10:56if you're going to give me a $3.5 million valuation, I think I have to say no.
11:03Would you do it for 10%?
11:05Yes or no for 10?
11:08Let me check in with my intuition for a second here.
11:10Will you guys give me a minute?
11:11While you're checking with your intuition, the question is, will you get a higher valuation
11:16in the future with one or both of us, or a higher valuation in the future on the path
11:20that you're going now?
11:24Would the two of you come in for a million dollars for 10% of the company?
11:29No.
11:30No.
11:30Really?
11:31Mark, you can do it if you want.
11:34It's just not my space.
11:35That's the same valuation as $500,000 for 5%, so I appreciate the math, but I like math
11:40just like you.
11:41But it's about the scale.
11:42Hey, guys, it's not going to make sense to me.
11:44I think these things are working.
11:47We might do it for 10%.
11:48We're not going to do it for less.
11:5210% for $500,000, what do you want to do?
11:57I want to say thank you very much for having me on the show.
12:00I have so much respect for all of you, and I'm going to decline the offer.
12:03Good for you.
12:03All right.
12:04Good for you.
12:05Yeah, Megan.
12:06Good luck, Megan.
12:06Thank you so much.
12:07I'm proud of myself for sticking to my guns.
12:11I know what my company's worth.
12:12I know what I'm worth.
12:13Little Saints is going to be successful no matter what, and the Sharks are going to regret
12:17not taking my original offer.
12:19I think she's undervaluing our value add.
12:22She has no idea who she's competing with.
12:23I know because I'm investing in these brands.
12:26She thinks she's going to go out to the venture community and raise $25 million?
12:29By the way, tomorrow morning, I won't even remember what she looks like.
12:32It depends on how much you drink of that.
12:33I would describe myself as an investor and a financial literacy advocate.
12:42I grew up on the south side of Chicago.
12:44We grew up very poor in a neighborhood where you're watching everyone live the American
12:49dream from afar.
12:51Rampaged by drugs and gangs.
12:53We probably got evicted every year I was in high school.
12:56You know, you get off the bus and you see your stuff on the curb.
12:58But all of those things really inspired me to understand money and understand why some
13:03people don't have these issues and why others do.
13:06And then what can I do to stop this from happening to my family, but also to my entire community?
13:11As a student, I was probably the most serious 12-year-old you would ever meet in your life.
13:15I was so focused that I wouldn't let anybody or anything distract me.
13:19Morehouse was the only school I applied to.
13:21I drove 714 miles.
13:23On the first day, they were accepting applications.
13:25The director of admissions, they said, you know you can mail it.
13:27I didn't want to wait.
13:28I said, hey, I have a 4.0.
13:30I'm the president of this.
13:31I'm the captain of this.
13:32And he accepted on the spot.
13:34But I couldn't afford to pay four years of college.
13:36So I applied to over 100 scholarships.
13:38And I wound up getting 17 scholarships.
13:40After Morehouse, I accepted my first job at Goldman Sachs with one condition, being able
13:45to work in the Chicago office instead of the New York headquarters.
13:48Because I made a promise to my community that I would come back.
13:51The next 10 years, I started my first venture capital fund.
13:54We were early investors in Coinbase, Robinhood, Ring, Casper, PillPack, Dropbox, Lyft.
14:00I manage over a billion dollars in venture capital.
14:03I'm a limited partner in the Atlanta Falcons.
14:05And I own a dozen businesses across the country.
14:07You really turn 10 million in capital plus star power into 100 million dollars in 10 years.
14:12One of the reasons I started working with athletes and entertainers so much is because
14:15an article is saying that 80% of athletes were going broke within five years of retiring.
14:20A lot of these guys are from my community.
14:21So I'm teaching them how to source deals, structure them, exit them.
14:25We go through the top 20 reasons that startups fail.
14:28We go through how to fund your startup.
14:29I'm here to give you the answers to the tests.
14:31I teach financial literacy and help all of the kids that I left behind learn the things
14:36that I learned in order to make it out.
14:37Every level that I accomplish, I'm trying to push that success a little further.
14:43Another way to think about success, my favorite way to think about it.
14:46You ever go to a very exclusive party, invite only list, and people are standing around in
14:52that party and they're not really dancing because they all belong there.
14:56But then there's one guy drinking all the drinks and dancing when no one else is who snuck in.
15:00That's how I feel in life.
15:03I'm not supposed to be here.
15:04I consider that successful, sneaking into the best party in the world.
15:23Next up is a business that's making custom-fit products more accessible.
15:34Hi, Sharks.
15:37My name is Matthew from Ventura, California, and I'm the founder of TrueFit Customs.
15:41Now, we know it's important for sharks to keep their teeth in their mouth.
15:45Well, it's also important for athletes.
15:47It's why they wear sports mouth guards.
15:49But traditional mouthpieces are big, bulky, and uncomfortable.
15:53They're the first thing left behind on your way to practice, and they almost completely eliminate
15:57in-game communication.
15:58How do we expect these boil-and-bust appliances to fit everyone's unique dental profile?
16:04And getting a custom-fit guard from the dentist is expensive and such a hassle.
16:09That's why TrueFit created a mouthpiece athletes actually want to wear.
16:12Each guard is made with the latest 3D print and scan technology.
16:16They feature shockwave dampering compression pads, a sleek, slim profile, and are cut so you
16:21can breathe and speak as clearly as I'm talking to you now.
16:24In fact, I'm currently wearing one.
16:29Nice.
16:29It's no coincidence that over 1,000 professional athletes across the NFL, NHL, PLL, NCAA, and
16:36UFC choose to wear TrueFit in our game.
16:38But we don't just make the best mouthpiece in sports.
16:40We're on a mission to bring custom fit to the people.
16:43And that's why we're asking for $750,000 for 5% of our game.
16:48Oh!
16:49It's your avacaramba!
16:51His mouthpiece fell out.
16:52Where's my mouthpiece?
16:53So, Sharks, we have some samples for you.
16:56Now, Matt, when I get my grinder for sleep, they laser my mouth to get a perfect fit.
17:01Is that how you're doing these?
17:02Because how are you going to get custom unless you're getting the exact fit for each mouth?
17:06That's a great question.
17:07Well, that's why I asked it, actually.
17:10So that impression kit right there is what we use for our direct-to-consumer model.
17:13So this is the gooey stuff you stick in your mouth.
17:16So what you're going to get at the dentist is an alginate impression putty.
17:20What we use is silicone putty.
17:22It's easier to work with.
17:23But there's a lot of these.
17:25You have a ton of competition.
17:27It seems like a solution to a non-existent problem.
17:30Since there's so many already in place, right?
17:32Is there a reason why you think there was a lane that wasn't being taken by others?
17:37We have a great hold on digital manufacturing.
17:40We specifically know how to scale custom fit fabrication.
17:44So when you say digital manufacturing robot, are you talking about 3D printers or actual robots?
17:48The whole thing.
17:493D printers to the 3D scanning to CNC machining.
17:53We can manufacture at such a high level because we're almost like an assembly line.
17:58When we're fabricating these, we're able to do it at such high volumes because it's machine to machine to machine to machine.
18:03All this is great, but you have a hefty valuation, so we want to hear about those hefty sales.
18:08Yes, sir.
18:08We started in 2022.
18:10We did $115,000.
18:12In 2023, we did $750,000.
18:15Wow.
18:16And then now this year, we're expected to do $1.4 million.
18:19That ain't worth $15 million.
18:20Now you have my attention.
18:22And how much will you lose?
18:23We will make money.
18:23Okay, good for you.
18:24Matt, you understand you're asking for close to 15x sales.
18:28This is not realistic at all.
18:29You know, Mr. Wonderful, I know that you did your dissertation on the dental industry.
18:34Yes, of course.
18:34And you know there's those three big guys in the room that own the entire market.
18:38Yes.
18:39But the legal landscape has changed over the past years, and it allowed direct-to-consumer to enter this market,
18:44which is taking market share from traditional medical practitioners.
18:48How much does it cost you to make?
18:49And tell us how much you're selling it for.
18:51Our direct-to-consumer, first-time customer is $95.
18:54It costs us $31, including shipping.
18:57Our CAC is $23.
18:59We do about a four-times return on ad spend.
19:01And so even with that CAC, we have about a 40% margin on our first-time customer.
19:06Matt, the valuation is insane.
19:10And it's not even, like, almost reasonable, so let's negotiate it.
19:14I just don't see it working to the valuation, so for those reasons, I'm out.
19:18Okay.
19:19Listen, when a guy who just put another $3.5 billion in his pocket said the valuation's too high,
19:24it's really too high for me, meaning mark.
19:27So with that being said, I'm out.
19:29Yeah.
19:30Thank you, Damon.
19:31I'm super torn on this because on one hand, I mentor and I work with over 100 athletes
19:36who are not only athletes, but they're investors, and they like to get into product now.
19:41It's this new generation of athletes, and I'm a limited partner in the Atlanta Falcons.
19:45So I'm into the product.
19:47Let me ask a question.
19:48How much have you raised?
19:49We've raised a million total.
19:51What valuation do they put it in at?
19:52$7.5 million.
19:53How many units are you going to be able to make and ship this year?
19:57You know, we'd probably look to do $20,000.
19:59It's not a lot for world domination of mouth guards.
20:04How are you going to get millions of customers outside of the athletes' booth?
20:07So let me explain.
20:08And when?
20:09So this year, we have a team sales model that's really budding.
20:11What we do is we provide guards to all these teams.
20:14They seed the players.
20:15The players love them.
20:16Then we approach the players for an affiliate deal.
20:18That's smart.
20:19It's an affiliate program, right?
20:21Are you paying, Kimish?
20:22Yeah, yeah.
20:22We give them a percent of sale.
20:23Okay.
20:24I love your deal.
20:24I like you.
20:25I'm having a huge problem like everybody else about your valuation.
20:28Makes no sense at all.
20:30So here's an offer for you.
20:31I'll do the $750,000.
20:33I'll drop my equity ask down to 3%.
20:36But you're going to pay me $2 a unit until I get back $2,250,000.
20:42I think that's a bad offer.
20:44It's going to take me four years at your current rate.
20:47But you get Mr. Wonderful.
20:49We do one thing for you and only one.
20:52Get your cack way down.
20:54I got minutes of followers.
20:55I got a massive social media network.
20:57Say yes, and we fall in love in the denture business.
21:00Wow.
21:01Kevin.
21:01I will just tell you my thought.
21:03You're doing things the right way.
21:05But I think that your valuation is too high.
21:08I would want to see a lot more proof.
21:10And it would take forever to get my money back.
21:13I'm sorry.
21:14I'm out.
21:15Listen, I'm a venture capitalist.
21:18And there are two types of investments.
21:20There are motorcycles and rocket ships.
21:22So motorcycles are common and they take regular fuel.
21:25Rocket ships are rare.
21:27Very few of them are made.
21:29And they take rocket fuel.
21:31VCs sell rocket fuel.
21:33So I'm looking for rockets.
21:34You don't have the growth rate and the amount of revenue as a rocket.
21:38But you have the potential.
21:39So you're trying to take advantage of that.
21:41And I know why your valuation is $15 million.
21:44Because someone told you that you had to double the post-money valuation of your previous round.
21:48Like every other venture-backed company.
21:49So I get all of that.
21:51So I want to make you an offer.
21:52Woo!
21:53Woo!
21:54Woo!
21:54Woo!
21:55Woo!
21:56Woo!
21:56Woo!
21:57Woo!
21:57Woo!
21:58Woo!
21:59Woo!
22:00Woo!
22:00Woo!
22:06Three sharks are out.
22:08Matthew has one offer on the table from Kevin for his custom mouthguard company, TrueFit.
22:13But Roshan is also interested.
22:15Just to give you one more summary of it, $750,000 cash arena.
22:19That's a lot of money.
22:20Yeah, yeah.
22:203% equity and $2 a unit till I get back $2,250,000.
22:25That's my deal.
22:26First, don't do the royalty deal.
22:28That's a bad deal.
22:29I would rather you take that money.
22:31There's never a bad deal for Mr. Wonderful.
22:33That's impossible.
22:34I'd rather you take that money and reinvest it into growth.
22:36I don't want you to be profitable at all.
22:38I don't want you increasing your expenses.
22:40I don't want anything coming off top because I want you to grow that revenue and crush all your competitors.
22:44That's the venture way, right?
22:45So, the first thing I want to do is I want to offer you the $750,000.
22:49I want to bring in 10 to 20 athletes as brand ambassadors and or investors.
22:56But for that, I want 10% of the business.
22:59The greed.
23:02The greed.
23:04I have never seen the greed like that.
23:05If you say no to that.
23:06I thought I was being generous.
23:07If you say no to that.
23:07Actually, that sounds smart to me.
23:09Would you be interested in doing $1,000,000 for 8%?
23:16Oh, you're going the wrong direction here, man.
23:18No, you're going the wrong way.
23:20I just offered you things that are worth more than $1,000,000 because of my track record.
23:26I was an early investor in Coinbase, Robinhood, Ring, Casper, PillPack, Dropbox.
23:30I'm literally on a winning streak.
23:32So, if I invest in this, this thing is going to catch fire.
23:34And you're going to raise money.
23:36And you won't have to do anything but kick ass.
23:41Yeah, I'm sticking to my offer, so I need an answer.
23:45Okay.
23:45So, you got two offers.
23:46Well, we already provide to the Falcons.
23:52So, Rashawn, I'd love to do a deal with you.
23:54Let's go.
23:55All right.
23:56All right.
23:57All right.
23:58Excellent.
23:59I appreciate it, man.
24:00Aw, thank you.
24:01Welcome to the family.
24:02Yeah, congrats, Matt.
24:03Good job, guys.
24:04Thank you, guys.
24:05All right.
24:05Appreciate it.
24:08This is absolutely incredible.
24:09This gives us the opportunity to provide to all of our customers and really go to the next
24:13level with our custom fit products.
24:14So, yeah, this is...
24:15Shark Tank's amazing.
24:17Congratulations, man.
24:18First deal.
24:19That's fantastic.
24:20First deal.
24:21Rashawn.
24:21Rashawn.
24:21Good job, Rashawns.
24:35Next up is a brand with a mission to inspire cultural pride.
24:39Hi, my name is Sam Hyun.
24:50And I'm Adam King.
24:52And we're two unapologetic Asian-Americans from Boston.
24:54We're seeking $100,000 for a 15.87% stake in our revolutionary sneaker brand.
25:01Sharks, did you know that Asian-Americans are obsessed with sneakers and are a huge factor
25:06in driving sneaker culture and a significant percentage of all sneaker sales?
25:10I'm one of those guys.
25:11I live, breathe, and sleep sneakers.
25:14I even slept on the street overnight to cop a pair.
25:17After working in the sneaker industry for 20 years, I got so tired of hearing that Asian-Americans
25:22are follower-consumers.
25:24And that is why we started 1587 Sneakers.
25:26Because 1587 is actually the year that the first Asian is documented to have set foot
25:32in what is now known as North America.
25:34So when people say, you're new to this country, you're a foreigner, go back to your country,
25:38what?
25:39We've been here 400 years.
25:41And so that's why we launched with the Marro Bay.
25:43Not only is the Marro Bay a throwback to 80s basketball sneakers, Marro Bay is also the
25:49exact landing spot for where that first Asian stepped foot in this country.
25:54Next, we have the AP87.
25:55This is a classic tennis silhouette that looks great with any occasion.
25:58All our sneakers are made with the world's greatest leather and natural rubber.
26:02So your sneakies will always look like a fob.
26:05Fresh out of the box.
26:07So Sharks, who's ready to walk with us and change the sneaker game forever?
26:12All right.
26:13Love it.
26:14So in front of you, we have customized sneakers for each of you.
26:17So you can smell the leather, feel the quality, feel the softness and the comfort.
26:21Are you guys marketing towards Asians only or is it just for everyone?
26:25So right now, we're marketing towards Asians.
26:27One thing we're super excited about, 30% of our customers aren't Asian American.
26:31So we definitely think this has legs with everyone.
26:32So walk us through your business model.
26:34You're selling direct to consumer?
26:35Correct.
26:36And where are you sourcing the product from?
26:38It says Italy in the tag, right?
26:40Italy?
26:40Yeah, it says made in Italy.
26:41So up until now, we did all our stuff in Italy because they are great for small batches and testing concepts.
26:48This is my third sneaker startup, so I understand the importance of having good margins.
26:51What happened to the other two?
26:52The first one, I was just employee number four.
26:54We went from $800,000 to $8 million.
26:57Then you started the next deal.
26:59So that brand was marketed towards African Americans.
27:03And that company was the first time for me being in charge.
27:06And I learned a lot.
27:08So it failed miserably, is what you're saying.
27:12And why is this one going to work and the other two didn't?
27:14Great question.
27:15This is our messaging.
27:16Walk me through that process.
27:17I've never heard of you.
27:18Snap my fingers.
27:19I'm Asian now.
27:20How are you going to communicate with me?
27:21One of our greatest assets is Sam.
27:23So he's actively involved in the Asian American community.
27:26Online, everywhere?
27:27Sam, tell us about you.
27:28What do you do?
27:29So I was actually born in just outside of Boston to a single mom.
27:34And she worked every job under the sun trying to make things work.
27:37And it was, you know, the American dream tells you to come here, you work hard, you play by the rules that you can achieve anything you want.
27:42But watching her working so hard, working three jobs and becoming a small business owner, you just realize that that reality wasn't the case for everybody.
27:50Yeah.
27:51And so I decided that I wanted to dedicate myself to making sure that America lives up to the promise that it said it would.
27:56And so for 10 years, I spent my career in both government and advocacy work.
28:00So during the wake of anti-Asian hate and the rise of violence, we spoke out a lot.
28:05And we made sure that people were understanding what my community was going through.
28:08So did you have a wide following on social media right now?
28:10About 250,000 followers.
28:12How many people follow the company's Instagram account?
28:15Roughly 7,000.
28:16Ugh.
28:17Right now, your followers, your lifestyle brand hasn't caught up to the opportunity.
28:22But I'm still trying to figure it out.
28:24All right.
28:24How much does it cost you to make it and how much you sell it for?
28:27When we built in Italy, the landed cost was $110.
28:31Wow.
28:31The retail was $288.
28:32But starting in three weeks, we transferred 90% of our production to Asia.
28:36So now the landed cost is $50.
28:38We're going to retail at $175.
28:40We wanted to make sure that we also understood our worth as a luxury brand shoe.
28:44And we priced it at that point, but also within reach and accessible to as many people as possible.
28:49When were you guys founded?
28:50We've only been in operation for 10 months.
28:51And what are you projected to do for revenue this year?
28:54We're projected for $500,000 this year.
28:56In the last 10 months, we've done $240,000.
28:58So have you calculated your customer acquisition cost?
29:02Our acquisition cost is $45.
29:04And our average purchase is $170.
29:06You guys have to really build the lifestyle part of this.
29:09And that's also going to help you get your customer acquisition cost down.
29:12Because right now, it's too big of a percentage of your profit margins.
29:15Well, what do you need?
29:16What do you need?
29:16Well, we definitely have to scale.
29:18So that's cash.
29:18Yep.
29:19And we're able to get into retail spaces.
29:21So we've already started.
29:21But are you really designed for retail?
29:23Because, I mean, that's hard to sell in retail.
29:26And you don't get your mission statement out.
29:28Listen, I don't think this is the right business for me.
29:31I'm really not a very good sneaker person.
29:35I mean, you know, to get on the treadmill, that's like it for me.
29:38Not the right deal, though, today.
29:39I'm sorry I'm out.
29:41Thank you so much.
29:42We appreciate that.
29:42So, guys, the shoe space, which is 80% of your sales, is incredibly competitive.
29:48The idea of going into retail, to me, that's sheer insanity.
29:51This isn't for me, I'm out.
29:53Listen, in my world, I look at how many points of failure are there between now and where
29:58this business needs to get to.
30:00And the ones that have, like, three to seven points of failure that we can identify and
30:04mitigate and structure around, I'm excited about those.
30:08And for you guys, there are, like, 25 things that need to go right.
30:11But the most important thing for me is the lack of traction.
30:14If you had a bigger community, if you were viral, like how he is personally, and you can
30:19sell them anything, then I can see this as a lifestyle brand and I will be more excited.
30:23But because it's not, I'm out.
30:27Here's where I have a bit of a challenge with it.
30:30I've been in this business.
30:31And when I did buy the company, Etonic, I realized so much that goes into this footwear.
30:37And I don't know if I want to take that part of the journey with you, especially if you're
30:41going into retail where you'll sell out of all your nine and a halves and tens, and then
30:45you have a massive amount of inventory sitting there that's going to deplete your bottom line.
30:49And those are the things that you're going to have to learn before I would be ready to
30:52invest in you.
30:52So good luck.
30:54Powerful idea.
30:55I'm out, but I love these sneakers.
30:57Yeah, guys, I disagree with Rashawn.
30:59You don't have 25 points of failure or problems.
31:02You just have to find your right path.
31:04And you want to be bigger, bigger, bigger because you want to go into retail because
31:08you think that's where you're going to scale.
31:09So you think we should focus on D2C?
31:11Yes, 100% because you have no margin in this thing.
31:14You'll kill it.
31:16Bam, bam, bam.
31:16You get to control your own destiny.
31:18You need to reel it in and just follow the course that is organic for you.
31:22So for those reasons, I'm out.
31:25Awesome.
31:26Good luck, guys.
31:26Thank you, guys.
31:30The advice the Sharks gave us is really good food for thought.
31:33We wanted to just be like, we're doing really well in D2C, but we got to get into retail.
31:38They've raised some really good points like maybe you don't need retail.
31:41So we're definitely going to take what they say and reduce this.
31:52Just like you've talked about forever.
31:5410 years in the making.
31:56You're ready.
31:5610 years in the making.
31:57Just like when I was 10 years old.
31:59And you're awesome.
32:01And you're a bell.
32:02You got this.
32:04I'm my mother's son.
32:04You're my mother's son.
32:05Next up is a way to make exercising a fun social activity.
32:21Hi, Sharks.
32:22My name's Destin George-Bell.
32:24I'm from Austin, Texas.
32:25I'm the founder and CEO of Cardio, a gamified fitness app.
32:28And I am seeking $150,000 for 5% of my company.
32:32Sharks.
32:33Cardio kind of sucks.
32:35Maybe you're a treadmill guy or girl who doesn't love running in place, staring out of a window
32:40or at a wall while numbers tick up on a display.
32:43Great time.
32:43Hamster life.
32:44Or maybe the jump rope.
32:46Because who doesn't love jumping in place, staring at a wall, looking semi-athletic, hopefully,
32:51as you sweat for 5 to 10 minutes, hoping you're burning some calories.
32:54But today, I am here to do the impossible.
32:57Make cardio suck a whole lot less.
33:00And we're doing that with Cardio, a gamified fitness app, turning your outdoor cardio into
33:04a giant game of turf war.
33:06Let me show you how that works.
33:07So let's say you're an athletic guy like Mark, and you decide you're going to go for a run
33:10today.
33:11Now, of course, Mark's going to do his four miles.
33:13It's pretty easy for the Cuban man.
33:14And as you finish, you'll see the area town you ran through.
33:17But Lori, always one to steal a deal, decides that she wants to run that same exact area
33:21to show Mark up.
33:22It's turning it into a giant game of turf war.
33:25Think Capture the Flag, but where the city streets, neighborhood roads, and hiking trails
33:29are areas that you compete to claim against other people in your city as a team.
33:34So as you see here, as Lori moves to this area, that'll actually go from Cardio Green
33:39to Shark Tank Blue while tracking all of her stats.
33:42And as you move, you'll see that the Shark Tank logo will actually start to move into the
33:46places that the Cardio team used to have it.
33:49Now, once Lori decides to finish up her run, of course, going a little bit faster than Mark,
33:53she's going to finish up, see all of her stats, and then she'll end her route.
33:58That'll upload into our system.
34:00She'll be able to see, track her for all the places and times that she's run.
34:03Now, let's flash back to Mark.
34:06He'll see that Shark Tank logo didn't used to be there.
34:08And he'll go to his phone and say, wow, Lori's stolen 109 blocks from my team.
34:12He'll click on that, see the specific areas of town that Lori went through, how fast she
34:17went, and to get it back, you guessed it, he's going to have to go out there and start
34:20hauling his butt over that way.
34:23Sharks, who wants to get out of the pool and hit the streets with me and the Cardio crew?
34:28So, how are you navigating separating yourself from other apps?
34:33That's where the gamification comes in, right?
34:35Yeah, I'm glad you asked that.
34:36So with these other trackers, they are focused on usually goal-oriented, performance-based running.
34:41With our app, we incorporate social gamification and dynamicism, where every time you go out
34:46there, the map looks a little bit different.
34:48It's just like a sports game.
34:50Do I want to run the same route I did before?
34:52I have a person on my team who ran that route.
34:53Maybe I should go to a different part of town.
34:55We got 22,000 users in 70 countries, and we've had people tell us.
34:59We do.
34:59We have 22,000 users in 70 countries.
35:02We have 14,000 active.
35:04400 run clubs have signed up their groups, and one corporate wellness pilot with Oracle.
35:08Are those free downloads?
35:09What is the revenue model after that?
35:10So freemium model, we bring people in.
35:12Again, mostly didn't know what I even meant by a turf war.
35:14So the thing is, we got to get them in, get them to fall in love with it.
35:17The retention rates have shown they have.
35:18We have a 34% day 30 retention.
35:20Are those free downloads or subscriptions?
35:22Like, just walk me through this.
35:24Yeah, free downloads.
35:25Free downloads.
35:25So 22,000 free downloads.
35:26And then the premium subscriptions, which is where the revenue comes from, is from those
35:29groups.
35:29Like I said, it's a team-based game.
35:31How much?
35:31Those teams, $25 a month.
35:33We target run clubs with organized dues and memberships.
35:36What was your revenue last month?
35:38Last month, 4,000.
35:39Okay, so how are you going to get that from 4,000 to 400,000?
35:43The biggest thing right now is opening the doors to the places that we need to be.
35:47We have already partnered with the San Francisco Marathon, Austin Marathon, and the-
35:51Some marathons.
35:52When you say partnership, what does that entail?
35:55These are run clubs that are using it as a way to engage and track data, which is why
35:58we've incorporated the ability to schedule events.
36:01So you're able to schedule and say, hey, we're going to go on a run at Pease Park at 7 p.m.
36:04They have the ability to have a team chat, kudos for people to say, hey, nice run.
36:08Well, that's cool right there, right?
36:09Exactly.
36:10How much have you raised so far?
36:11Started the business June 2022.
36:14We have raised 470K as of now.
36:17Primarily, that was from 150K in grants from Pokemon Go.
36:20Wow.
36:21Nice.
36:21So basically, I got this idea during COVID.
36:24Like, I was broke as a joke.
36:25I was living in my car in Austin, Texas, trying to figure this out.
36:29I'm not an engineer.
36:30I tried to teach myself how to.
36:32Didn't work very well.
36:33Wouldn't have looked as nice as it did here.
36:34So I started DMing engineers.
36:36I DMed 400.
36:37All of them said no.
36:38But one of them was a founding engineer for Pokemon Go, and he loved my moxie.
36:42He said, I'm going to drop the CEO of Pokemon Go's email here.
36:45Do what you want with it.
36:46I'm not allowed to make an intro, but I can give it to you.
36:49Shoot your shot.
36:49So I shot him an email.
36:51This is May of 2021.
36:52Two months later, he responded.
36:53Here's the funny part.
36:54I got on a call.
36:55He wasn't on it.
36:56It was three of his other people, and they only took the call because he made them take it.
36:59Then they said no.
37:00But I said, well, I know you'll read them now.
37:02So I sent him an email every week for the next three months until eventually he said, all right, kid, here's a 50K grant.
37:08Get out of my inbox and keep working on it.
37:10Let me just tell you, that's brilliant, and I hate you because now everybody out there is going to send us 600 emails a week.
37:16That is really amazing.
37:17I always say the dream is free and the hustle is sold separately.
37:20Love it.
37:21Right?
37:22The only problem that I have here is that there are two things that are not in my wheelhouse at all, running and gaming.
37:29I would not bring enough benefit to what you're doing, so I'm sorry.
37:33I'm out.
37:34That's all right.
37:34Thank you, Lori.
37:35By the way, my mom says you're her favorite.
37:37Oh.
37:38I love her.
37:39Why don't you come up with the $3 million valuation, $150K, 5%.
37:45I got that valuation from the fact that investors wrote us those same terms that we've raised on currently as of last month.
37:51But more importantly, I'm projecting the future of where we're going to be.
37:54The thing you're buying today is not going to be worth what it's worth today forever.
37:58Everybody that's ever stood there said the same thing.
38:00And some of them were right, and I think I'm one of them.
38:02Mm.
38:03That's a good answer.
38:03That's true.
38:05Dustin, going for the kill.
38:06It's not a deal for me.
38:07It's not a deal for me.
38:08Your 4K is the beginning of proof of concept.
38:12I don't think there's enough data for me to pull the trigger on this interesting presentation.
38:15I'm out.
38:17The problem with this kind of business is you are always stressed because if you don't have critical mass, the whole thing doesn't work.
38:24But the thing is, the critical mass is created through the team signing up.
38:28No, I know.
38:28It's not about them competing against other teams.
38:30It's I have a group of people.
38:31No, I get that, right?
38:33Right.
38:33But you've got to keep enough teams or everybody thinks there's no app, right, or that it doesn't work.
38:38But I just don't know how I can help you scale that, right?
38:40I just don't see it as a fit for me, my guy.
38:42I'm sorry.
38:43So for those reasons, I'm out.
38:45All right.
38:45Thanks, Mark.
38:46Appreciate you, man.
38:47What is really driving you to be successful right now?
38:50What is that thing that's inside of you that's really pushing you?
38:52Well, my mom is out there right now.
38:56I used to have a really bad lisp and a stutter, and I was a bad public speaker.
39:01I was 10 years old.
39:02I was watching the show before you were even on it, Mark.
39:05And my mom said, I want you to watch the show and see how people present.
39:08And I watched it every Friday and Sunday for like the first from like 10 to 16.
39:12At 16 is when I first really started getting the business.
39:15And I told my mom, we're going to be on this show one day, Mom, and I'm going to bring you.
39:19She's back there waiting for me to give her a deal.
39:21I love that.
39:22I love that.
39:22And I'm creating generational wealth, and I want my kids to have something.
39:25So I'm here to do that.
39:27And I told my mom I wouldn't walk out of here with a deal.
39:29So what do you want from me, Rashawn?
39:31So I want to go in with Damon because I think you're a great salesperson, and I think you can become a good business person.
39:38I think you need mentors.
39:40You need strategy.
39:41You need access to capital.
39:42And I've done over 100 software investments.
39:44That's just kind of my thing.
39:45And I really enjoy doing it, and I enjoy mentoring young founders, especially guys that remind me of myself, that have that grit.
39:52I got to be part of this, and I don't care how I'm part of this.
39:56And I love your energy.
39:57I did the same thing.
39:58I just did it with a phone, you know, 40 years ago.
40:00I made 50 calls a day for six months until people picked up.
40:03And the first half of them said no.
40:05And, you know, three months later, they said, you're not going anywhere.
40:08And I said, nope.
40:08And then they started to write checks or recommend me to go other places.
40:12So I love that.
40:13So, one plus one equals five in this situation here.
40:16Now, keep that in mind.
40:17Okay.
40:17150,000, but we need 15%.
40:20Why are you waiting?
40:30How would you feel about 10%?
40:32Yo, Dustin!
40:33I love it, though.
40:35I love the guy.
40:36Dustin, come on, man.
40:37No, but I love the guy's hustle.
40:39I love it.
40:39So, I'm going to repeat, 15%, $450,000, and you're going to get 10 more things.
40:45You're going to get Damon and I.
40:46By the way, I can hear your mother screaming, take the deal, Bozo.
40:48Yes, I can, too.
40:49Take the deal.
40:53I have one question to ask you, all right?
40:56And I don't want the deal to be gone if I ask it.
40:59Can I go talk to my mom?
41:01I think you should bring your mom out.
41:02Bring her out.
41:03Bring her out.
41:03I think she needs to hear the story.
41:05Bring her out.
41:05I want to go get my mom.
41:06I guarantee she's going to say take the deal.
41:08Mom, come here, come here, come here, come here.
41:09All right.
41:09Aw.
41:10Come here.
41:10I love this guy, man.
41:11Come here, come here, come here, come here.
41:12Hey, Mom.
41:12She's actually my sister.
41:14Clearly.
41:15Hey, Mom.
41:16Mom, you heard all that, right?
41:17Hi, Mom.
41:17What do you think?
41:18What do you think?
41:19You're right.
41:20I was back there saying, boy, let's do the deal.
41:23Mom, talk some sense into your son.
41:27Let's do the deal.
41:29Rashawn, Damon, you got a deal.
41:31Oh!
41:33Let's go.
41:36Congratulations.
41:37That's what I'm talking about.
41:38How are you doing, man?
41:39You know what you're doing?
41:40How are you?
41:41That's a beautiful suit.
41:42Aw.
41:42Congratulations, man.
41:43What's up, man?
41:44I love you so much.
41:45You can have that focus, man.
41:46I love you, son.
41:47I came here on a mission, my mom.
41:48I knew you did, man.
41:49I always accomplished my mission.
41:50I know you did, man.
41:50That's an all-in DMs that come out here and get no deal.
41:53Come on, man.
41:54Congratulations.
41:55Thank you so much.
41:56Great job.
41:56Great job.
41:57Great job.
41:58I told you, Mom.
41:59I told you I'm a man of my word.
42:00I'm going to stand on business every time, man.
42:03Every time.
42:04Ten years in the making, baby.
42:05I planned it.
42:06Sixteen years old I planned this.
42:08Oh, my gosh.
42:10Good one, man.
42:11That guy is awesome.
42:12That kid's awesome.
42:12He's not playing.
42:13Next time on Shark Tank, Todd Graves, the founder of fast dining phenomenon, Raising Cane's,
42:20joins the tank.
42:21I love that entrepreneurial drive.
42:23And I live it every day.
42:25It's an addicting feeling you crave over and over again.
42:28You will have a mouth-watering feast.
42:31Let's eat.
42:32We need your help bringing our innovative products from our customers.
42:34Little Mr. Wonderful here saying, do the deal.
42:36And the other guy says, what are you, an idiot?
42:38Boy, you're a little frisky.
42:39One of the most innovative things I've seen in my life.
42:40I'm ready to go to the moon.
42:41Bring the sales.
42:42Now you're the Sharks.
43:12Oh, you're the Sharks.
43:16Oh, you're the Sharks.
43:18In my life.
43:19Oh, yeah.
43:19Oh, yeah.
43:20Oh, yeah.
43:21Oh, yeah.
43:21Oh, yeah.