Triumphs Of A Man Called Zonk
Hey, if some Shark wants to hand over $50,000, Philip Michaels is perfectly willing to get saddled with a stupid nickname handed down by Kevin O'Leary, too.
Tonight on Shark Tank, we meet a trio of Nepalese immigrants who, through the sweat of their collective brow, have managed to build a multi-million dollar pet-food concern. We also are introduced to two young go-getters, looking to bring youth and vitality to the cutthroat world of cosmetics. And then there's a guy whose pitch for a floating drinking vessel is so amateurish, Kevin O'Leary demands he change his name to Zonk, lest he bring shame to other people named Kevin.
So of course, Zonk is the only one in that threesome of entrepreneurs to walk away with any money from the Sharks.
Let's find out how we got to this point.
First, let's meet the thoroughly inoffensive and consequently not very interesting Bobbie Rhoads, who has developed a product aimed at children who are picky eaters. Funbites are essentially brightly colored kitchen tools that bear a resemblance to what you might find in a Play-Doh fun factory. You run your food through the Funbites guillotine, and you're left with bite-sized pieces in playful shapes that your ungrateful little kids are more likely to eat. Bobbie's racked up $400,000 in sales and overcome some early packaging problems that make it appear as though she has a good head on her shoulders, even if, as Robert Herjavec points out, Funbites really doesn't do anything someone with a passing familiarity with a kitchen knife couldn't pull off.
Nevertheless, there's some interest among the Sharks, principally among Daymond John, who sees licensing opportunities. He offers $100,000 -- more than the $75,000 that Bobbie wanted -- but he wants a 30 percent stake to make it more worth his time than Bobbie's proposed 20 percent equity. "Guess what time it is," Lori demands, and unfortunately Robert indulges her by asking what time it is. "It's deal time," Lori pronounces, in what sounds like a trial balloon for a terrible catchphrase leading to an ill-considered line of Shark Tank merchandise, culminating with a Flavor Flav-style oversized novelty clock featuring Lori's disembodied head chirping "Deal Time!" throughout the day. Please do not make this happen.
Anyhow, Lori's offering $75,000 for 25 percent equity, dangling the prospect of getting Bobbie's product into retail outlets. As Daymond drops his ask to 25 percent, Lori presses Bobbie to say yes right now. She does, before Mark Cuban can even make an offer of his own, which seems like a grave tactical error. Indeed, Mark seems to indicate that Bobbie would be wise to reconsider her hasty deal-making with Lori. "Sometimes, there's a benefit to listening, and it's actually not too late to change your mind," Mark says, and for a minute, it looks like we may be treated to the glorious sight of someone cutting Lori dead to strike a deal with another Shark. But alas, Bobbie turns out to be as principled as she is not terribly compelling for our purposes, and the deal with Lori goes through. The only other item of note in this segment is that Kevin O'Leary's response to picky eaters is to let the children starve, which sounds like the position of a man who raised his kids via an army of nannies cordoned off in a sound-proof vault miles beneath the Earth's surface.
3. The Lip Bar
Melissa Butler and Roscoe Spheres are not terribly impressed with the variety of lipstick colors on the market today -- reds, pinks, and the intriguingly named nudes. So they've come up with their own business that features more eye-catching colors. Some, like the purple hue Melissa's wearing, are quite striking; others, like the green hue coating Roscoe's lips, suggest a circulation problem.
More worrisome is the not-as-impressive-as-you'd-hope-for sales of $107,000 over two years, even if the margins are spectacular. (It costs Melissa $3 to make the lipstick by hand, which she then sells for $20.) Melissa counters, though, that The Lip Bar is all about the message: "Our messaging is empowerment. We believe women can be whoever they want to be. They don't have to be in this cookie-cutter box." Mark counters, not unreasonably, that the empowerment message sort of gets lost in their logo, which is a martini glass coated with a red lip imprint. He and Robert drop out over that, Daymond is not particularly interested in lipstick, Kevin concludes that the major players would already offer these colors if there were any demand, and Lori frets about the competition. There are no offers, certainly none in the $125,000-for-20-percent range that the ladies were looking for.
So that's that and...wait a minute. From the other side of the room, it appears my wife has something to say.
The makeup business they were pitching is a rare Shark opportunity to get ahead of a trend in a market instead of chasing a lagging indicator. Non-natural color has already taken over the nail and hair markets, and the early adopters on Instagram are doing the blue or green lips right now. So you have a company that is eco-friendly; aimed at customers who are not, shall we say, Northern European; and poised to tap into a buzzing trend in beauty. This is the kind of company that Estee Lauder buys in 2016, because it will cost Estee Lauder less to acquire a niche market than to try and develop it on their own. A smart Shark would get a stake in this company and work to build buzz on social media (especially Instagram) and target customers who respond well to intersecting trends. Then they'd push for a sale. These people, instead, show that they can't identify emerging markets when those markets stand in front of them in really captivating violet lipstick.
So there's that. My only counterargument would be that the green lipstick was unspeakably unflattering.
2. Himalayan Dog Chew
Suman, Sujan, and Nishes Shrestha have left the mean streets of Nepal to make their fortune in America, where the streets are apparently paved with dog chew products. Specifically, the Shrestha trio have taken a cheese that's popular in the Himalayas and turned it into a hardened, protein-packed snack for dogs. The sales are certainly impressive -- $5.6 million in the last year -- but probably not impressive enough to justify the $15 million valuation the Shresthas are placing on their business via their $750,000-for-a-5-percent-stake asking price. Even less impressive are the plans for whatever money they raise -- about half of it is earmarked for the respective pockets of Suman, Sujan, and Nishes, which I've found is a poor way to convince rich people to cut you a check.
For that reason, nobody seems particularly jazzed about making an offer, save for Kevin, who's not all that interested in equity. Instead, Kevin proposes a venture debt deal: $750,000 that he's going to loan to Himalayan Dog Chew at 10 percent interest, with a 5 percent equity stake for his troubles. And all that money will be put to building capacity to meet future lucrative deals. That's enough to convince Robert to jump in on the deal, boosting the equity stake to 10 percent. "It's good to have a sherpa when you're in business," Robert patronizes.
The Shresthas leave the room to discuss their options, which is usually when Bad Things happen on this show. In this instance, Bad Things mean Lori jumping in on the deal, which raises the total equity ask to 15 percent. Sadly, Suman, Sujan, and Nishes aren't all that interested in being on the hook to pay back a loan. They counter with a straight equity deal, which is Lori's cue to say "Oh my, look at the time," and then vanish. Kevin's out, too, and soon it's just Robert offering $750,000 for 15 percent. There's some hemming and hawing over what that does to their valuation -- "You wanted a straight equity deal," Robert sniffs -- and soon all offers are off the table, and the Shresthas are on their way. We do get to hear Mark Cuban's running sideline commentary on the strength of all these offers, which annoys both Kevin and Robert to no end, and I'm going to assume that an annoyed Kevin entertains you since you likely have a soul.
Kevin Waltermire is a man with a vision. Rather than watch as his fellow Americans struggle with spilled drinks while bobbing around in the ocean or at a pool, he invited the BevBoy, which promises to keep your drink from tumbling into the briny deep. The device essentially looks like a not-that-well-thought-out sex toy dangling from a cupholder, but the beauty of BevBoy is that the world's deadliest sex prop is really a weighted extension that gives the whole contraption a center of gravity. At any rate, Kevin Waltermire reasons, that's certainly worth $50,000 for a 15 percent stake, even if his sales in the last six months top out at $10,500.
Kevin O'Leary hates this product, and hates the fact that he shares a first name with its creator even more. Kevin -- the guy with the money -- orders Kevin -- the guy who wants the money -- to change his name to Zonk, and so that's what it is for the remainder of this segment.
Not everyone wants to humiliate poor ol' Zonk. Lori floats an offer -- $50,000 for 40 percent because she feels like she's going to be driving the whole business. Daymond thinks that sounds about right, and counters with his own more-or-less identical offer "just to stick it to Lori." Kevi-- er, Zonk wonders if either Shark would care to meet him at 30 percent. Lori will, but only with a contingency in place about getting the BevBoy to a big box store. Daymond holds firm for a bit, but does take his equity down to 35 percent when it's apparent that's what it will take to seal the deal. Way to go, Zonk. That money will surely take the sting out of your newly assigned, terrible name, which under the terms of your Shark Tank appearance is now legally binding.