Shark Tank Experiences Technical Difficulties
Not every product is made better by sprinkling some high-tech pixie dust on it and calling it a day, as more than a few of the would-be entrepreneurs learn on this episode.
I don't want to come across as a machine-smashing Luddite here. Technology has been very, very good to your correspondent, keeping him gainfully employed nearly continuously for the last two decades. But not every need is calling out for technical wizardry. I do not require an app to help me grow cilantro. I don't need middleware to find me somewhere to flop in between business meetings. I'm pretty sure I don't want my daughter's stuffed animals to be cloud-connected recording devices. And yet, that's what we got on this Shark Tank episode -- a bunch of people using zeroes and ones to create the perfect round-shaped peg that's still incapable of fitting in the square-shaped hole.
Of course, I could just be cross because Shark Tank keeps trying to make Chris Sacca happen, and if nothing else, this installment finally crystalized why the ex-Googler -- has Chris ever told you about that time he was involved with Google? -- does my head in. His appearances feel far too...practiced. In one segment, Sacca fires off a zinger at Mark Cuban's expense -- "if he ever had an original idea, it would die of loneliness" -- which clearly was pulled by one of his assistants from The Big Book Of Devastating Put-Downs, Vol. 3 for just such an occasion. It does not help matters that Robert Herjavec hears this well-rehearsed riposte, brays like a jackass, asks Sacca to repeat it, and brays at it again.
Christ, Robert, we're two steps away from a "Yo Mama So Fat" showdown at this rate.
Anyhow, let's run down this episode's pitches by just how much technology brought to the table.
Well, there's no denying that technology is very relevant to what Bitsbox is doing. After all, the entire raison d'être for the business is to teach your kids how to code so that they are able to get good engineering jobs and support you when our economy craters by...oh, let's say next Wednesday. Bitsbox is a subscription-based business that charges between $20 and $40 a month to send out coding project to your little mini Bill Gateses and Steve Jobses.
To justify why the Sharks should give them $250,000 for a measly 3 percent of their company, Scott Lininger and Aidan Chopra trot out a 10-year-kid who was already working with Python and C++ long before Bitsbox came into her life. She tells the Sharks she wants to be a bionic limb programmer, and shit, man, why can't we just hand her the $250,000 and send Scott and Aidan packing?
The trouble is Scott and Aidan have raised a lot of capital from elsewhere, and while they are nobly trying to protect the company's value for their existing investors, the $8 million valuation they're asking the Sharks to swallow is a bit much. Everyone drops out, save for Chris Sacca, who sees an opportunity to make a bid where his only rival is cold, cruel rejection. Sacca will pony up $250,000, but he wants a 5 percent stake. That cuts the Bitsbox valuation to $5 million.
There is a lot of back and forth here -- perhaps too much, since it becomes readily apparent that Scott and Aidan are not the world's greatest negotiators. Yes, Sacca lays it on a little thick with the "how can you disrespect me like this?" routine -- I know; Sacca over-acting is quite the surprise -- but the bottom line is Scott and Aidan are fussing over percentage points when there's a big picture to pay attention to. When they try to counter-offer with a 4.75 percent stake to the 5 percent equity Sacca wanted, he pulls the offer. And then they keep trying to counter-offer, even when all the other Sharks have to remind them that they're done. Good thing, too, or else those guys would have still been there, haggling over decimal points as 20/20 hit the midway point.
Technology is also at the heart of Gauri Nanda's product, though I'm not entirely sure it's to the product's benefit. She's made Toymail, a plush doll that lets kids press a button to record a voicemail message which then gets beamed over Wi-Fi to their parents' phones. It's never really articulated who this is for, but one presumes it's for parents who do a lot of traveling and want to give the illusion that they keep in touch with their kids via the power of exchanging voicemail pleasantries. It's also never really spelled out what the age range for Toymail is -- presumably you're aiming for the under-10 set, unless you like getting voice messages along the lines of "I NEVER ASKED TO BE BORN, FATHER!"
It is clear the Sharks do not share my concerns, because Chris Sacca jumps right in with an offer. He's not wild about Gauri's valuation (she wants $250,000 for 2.5 percent), so he floats a $400,000-for-5-percent deal, which he is confident will be the best out there. Allow Mark Cuban to shatter that confidence with his $500,000-for-5-percent offer.
At this point, Lori Greiner clears her throat, and it immediately becomes obvious that Gauri wants to do a deal with her. Sacca picks up on this, and wisely amends his offer to $600,000 for 5 percent and Lori can contribute any percentage of that cash she wants. Lori decides that a 50/50 split sounds mighty fine to her, and Gauri can't say yes fast enough. Exciting times -- I can't wait to dictate it all into my stuffed animal/recording device.
2. Hotels By Day
I confess to not really buying into the premiss of Hotels By Day, which posits that when you take a one-day business trip, your primary concern is not handling the business at hand and then getting the hell out of Dodge but rather, finding a place to flop in between meetings. So Hotels By Day works with hotel chains to let you reserve a room between 9 a.m. and 6 p.m. for an average of $90.
As someone who's gone on his share of blitz-in/blitz-out business trips during the past couple years, I do not remember thinking, "Man, if only I could add the hassle and expense of including a hotel room for the limited time I have available here." But to hear the Sharks tell it, I am a hayseed. "There is no question the market is there," Robert Herjavec declares, and who knew the secret to being rich is to spend money on hotel rooms you really don't need.
Rather than be put off by the basic idea that Brian Dass and Yannis Moati are proposing, the Sharks are more concerned by the fact that there's really nothing stopping hotels or hotel booking services from implementing the Hotels By Day approach if there really is money to be made here. Yannis counters that Hotels By Day has figured out a workaround to the antiquated hotel reservation systems that gives them an edge. Yes, the Sharks explain, with rapidly decreasing patience, but that doesn't mean someone else couldn't come along and figure out the same thing. Around they go in circles, with the Sharks asking the same questions and the Hotels By Day boys offering the same insufficient answers until eventually everyone has dropped out.
1. Edn Wallgarden
Ryan Woltz is here to tout Edn Wallgarden, a product aimed at urban gardeners, and he wants $150,000 to help buy a badly needed vowel for his company's name. Nah, just kidding -- he wants the money to help grow his indoor gardening business.
Edn's approach to gardening is to supply a wall unit -- it's $499 for the large model, but $99 for a starter kit. You pour in the water, add some plant food and stick in one of Edn's seed pods, and presto -- an app manages the rest of your grow cycle, from how much light to shine on the plants to when it's time to water and feed them. Managing all of that via an app would seemingly strip gardening of all its fun, relaxing parts, but we've already established that I apparently hate technology and all it stands for.
But at least I don't hate plants, as Robert seems to. "You need someone on this journey who enjoys plants," Robert tells Ryan, as he drops out with an unpopular but undeniably bold stance of "To hell with living things." Mark is much the same way, while Chris Sacca of all people thinks Ryan's over-emphasis on technology has stripped all the soul out of the experience.
Did someone say "soulless"? Because that's Kevin O'Leary's cue. He's willing to put in $150,000 for 15 percent of the company -- 5 percent more equity than Ryan wanted to give up -- but Kevin's confident he can help with distribution. Lori ups the ante by asking for 25 percent for her $150,000, and Kevin's so put off by Ryan even entertaining other offers, he ratchets up his own bid to 25 percent. Ryan, who has already squandered a perfectly reasonable offer from Kevin, decides now is the time to negotiate, which sends Lori fleeing for the exits.
That's not good for Ryan in that Kevin's position has become more intractable. Would Kevin like to return to his original 15 percent offer? Kevin would not. Well how's about 20 percent then? No, Kevin's comfortable at 25 percent. So Ryan, who not unreasonably has designs on raising additional capital down the road, decides he doesn't want to give up that much equity at this point. And so we are left to grow our herbs and vegetables without the intervention of some sort of smartphone app, like we're a bunch of goddamn peasants.