TITIN Gets Half a Million from Sharks - Shark Tank Season 6 Episode 7
Shark Tank Season 6 Episode 7 started with Mr. Whaley, owner of TITIN, seeking half a million investment in return for 5% equity in his company. TITIN sells weighted compression gear, an ideal solution for athletes looking to take their training to the next level. A biomechanics engineer by trade, Patrick came up with idea for TITIN in his dorm room, and even used TITIN to rehabilitate himself after getting shot in the chest when he got caught in the midst of a bank robbery. But before Patrick could delve into any of the specifics of the company, Mark immediately pounced on him and wanted to know the science behind TITIN. Patrick began to explain the effects they’ve seen on athletes who train with TITIN, but Mark is not having any of Patrick’s anecdotal evidence, he wants to hear the actual science behind the products. Kevin steers the conversation toward finances, and Patrick mentioned that he had nearly $1 million in sales in the last month alone. The company operates at about a 30% profit margin, and doesn’t have any debt, but he didn’t net a profit last year after Patrick used earnings to buy out his former investors. Patrick has $1.4 million in POs that he can’t fulfill, and is hoping a Shark’s investment will provide him the capital to fulfill these orders. Mark, still unimpressed, says that his BS meter is going through the roof, despite Patrick’s claims that further research is in progress. Mark’s out. Kevin is first to make and offer, and he’s in $500,000 for 15%. Daymond appears to be on the fence, and says he doesn't know if he can trust Patrick. Patrick says Daymond should trust him, he’s an eagle scout. Daymond takes a chance and offers $500,000 for 20%. Patrick counters both offers at $500,000 for 10% and counters Kevin at $750,000 for 15%, but neither Shark is considering it so Patrick jumps on Daymond's offer.
Second presenter that night was Eric Bandholz looking for a $400,000 investment in exchange for 15% equity in his company, BeardBrand. Eric's company sells beard-grooming products, most notably their beard oil that softens up beards and keeps them looking, feeling and smelling good. In the 17 months BeardBrand has been in existence, they’ve done $800,000 in sales. Lori is utterly entranced by Eric’s epic beard, and even says “There’s so many things that go into my mind with a beard like that.” The male Sharks give Lori a hard time until she eventually goes up and touches Eric’s beard. Beards aside, Eric is projecting $1.2 million in sales this year, and he’ll net about a 25% profit. The beard oil comprises about 60% of his total sales, and the oil generates an 85-90% profit margin. While the Sharks like that margin, they’re less in love with the business overall, and all of the Sharks have concerns about such a niche market so they all are out.
Next into the tank was John Devecka and Eric Berkowitz entered the Shark Tank asking for a $1.5 million investment in exchange for 5% equity in their company, Singtrix. Singtrix claims to be able to make anyone sing like a rockstar with their karaoke system that pitch-corrects, adds instant vocal harmonies, auto-tunes, and provides hundreds of other effects. The duo is no stranger to this business, having sold patents from a previous venture to Guitar Hero. They’ve done $1.2 million in sales in the last 6 months, and make about a 40% profit margin. They guys are confident in their $30 million valuation, based on a consumer electronics distributors with whom they’re considering signing and exclusive deal. Kevin is first to make an offer and he’s in at $1.5 million for 50% until his investment is recouped, and then his equity drops to 10% and he gets a $2.50/unit royalty in perpetuity. Robert makes an offer of $1.5 million for 20%. Lori follows up with an offer similar to Kevins: he’s in $1.5 million for 30%, and her equity will drop to 15% after her investment is recouped, and she also wants a $2.50/unit royalty in perpetuity. Kevin joins Lori’s offer, so they’re in this together. Daymond also wants a piece of the action, and he offers $1.5 million for 25% with the promise of financing all offers moving forward, so they won’t need the capital to finance their manufacturing. The guys counter at $1.5 million for 7%, a far cry from any of the offers on the table, leading all of the Sharks to quickly back out and no deal for Singtrix.
Last is Talia Goldfarb, founder of Myself Belts. She's asking Sharks for a $60,000 investment in return for 10% equity in her company. Myself Belts are designed to fasten onto a child’s belt loops, but, thanks to velcro closures, they can be easily fastened and unfastened one-handedly by kids. Talia launched Myself Belts ten years ago, and the Sharks quickly uncover the fact that the company has experienced a sales decline in the last three years. While Talia attributes the sales decline to the economy, which decreased the boutiques carrying her belts, the Sharks are less convinced. Still Talia is hoping to grow her business either by expanding internationally, licensing the technology to large apparel manufacturers, or both. The Sharks think Talia is selling herself and her business short, simply because she isn’t hustling hard enough. Daymond sees a spark in Talia, though, so he’s in at $75,000 for 25%. Talia counters Daymond at 20%, and while he likes that she’s fighting for her business by countering his offer, he’s not changing the 25%. Talia wants to work with Daymond and she accepts his offer.