Shark Tank

Discussion in 'BBS Hangout' started by what, Jan 11, 2014.

  1. what

    what Member

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    So, I'm a big fan of shark tank and last night I think I probably saw the worst team ever accepted on that show.

    The product was Groove Book. And the owners of this technology which basically allows you to ship pictures through the mail for far cheaper than you could without it, was swindled by Marc Cuban and Mr. Wonderful, who came at them with a licensing deal, where they get 80% of it for 150k and are allowed to sell it to instagram, picassa, shutterfly, etc.

    The owners jumped at that deal because they were able to retain 100% of a subscription service that will probably never get off the ground. When when Damon John brought up the There Will Be Blood analogy, these people didn't get it.

    They just sold the most important part of their company (the technology) for 150k. Unreal.
     
  2. Rocket River

    Rocket River Member

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    A friend told me about it . . . . .
    Said that the other guy had a 50/50 dealfor 375K and they turned it down

    Unreal

    Rocket River
     
  3. what

    what Member

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    Yeah, I seriously didn't get this deal for that couple. I can't possibly fathom that they understood the deal completely because they just gave up 80% of their company for 150k.

    A deal which is likely to lose them 10s of millions of dollars. I mean usually the sharks are much more even in their deals, but they were out for blood on this one.
     
  4. FrancisFan

    FrancisFan Contributing Member

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    They gave up 80% for the non-subscriptions sales and not the entire business (I believe). Crazy that he already put $400,000 into the business, then said that 50% is worth $375,000.
     
  5. astrosrule

    astrosrule Member

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    He also at one point said it was worth 6 million, i don't understand why he didn't try to get more then the 375 for 50%
     
  6. what

    what Member

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    the non-subscription sales IS the business. That's the crazy part.
     
  7. CHI

    CHI Contributing Member

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    He gets to charge Mark Cuban to print the GrooveBooks because his printing company gets an exclusive deal to supply them. He also gets a 20% royalty on the non-subscription service. So, he keeps 100% of subscription, 100% of printing company, 20% of non-subscription. Not a bad deal for 150k because the Shark's connections and letting all of the other companies print one-off GrooveBooks will make their other business blow up. Remember, his printing company gets the exclusive to print these.
     
    #7 CHI, Jan 11, 2014
    Last edited: Jan 11, 2014
  8. Rocket River

    Rocket River Member

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    I did not see the show
    This seems a bit more equitable

    Rocket River
     
  9. what

    what Member

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    There is absolutely no way his tiny printing company could handle a full on instagram service. The whole point of cuban going after the non-subscription side of the business was because he even said, if your printing company goes outta business, what am I left with? That is why that couple kept saying that I want some "skin in the game" because they get nothing but 20% of the instagram deal. Their printing company is only servicing THIER customers, not instagram's.

    cuban and mr. wonderful are actually going to license the technology to instagram and thereby, instagram can scale it themselves.
     
  10. Voice of Aus

    Voice of Aus Contributing Member

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    I had never heard of the show, youtubed it, watched the first 4 episodes and loved it.

    It is now 6.50am and the rockets play in 4 hours. O well on to episode 5
     
  11. RV6

    RV6 Contributing Member

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    The guy with the wall patch up thing was clueless for what appeared to be a bright guy. Probably got too nervous. Once you've got something under patent (patent pending? can't remember) they're all over you. He should have used the other sharks to get a better deal out of the two he wanted all along. Dude was in the driver's seat.
     
  12. TheRealist137

    TheRealist137 Member

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    The deals they make on the show aren't binding. Once they actually get it in contract form and ready to be signed that's when it becomes a deal. The owners have ample opportunity to back out or redo the terms.
     
  13. RV6

    RV6 Contributing Member

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    But can they switch sharks?
     
  14. what

    what Member

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    I'm not so sure of that. Verbal agreements are binding.
     
  15. kaleidosky

    kaleidosky Contributing Member

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    yeah I thought they can only pull out if something is incorrect. Like, if a patent they talked about doesn't exist, if sales figures aren't what they claimed, etc. But not just without reason..
     
  16. jdh008

    jdh008 Member

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    I enjoyed Shark Tank for a while, but I haven't watched it in quite some time because the sharks, with the exception of Cuban, who I found to funny at times, just became insufferable.

    But I am glad that the show is succeeding because there was a time when it wasn't. I remember an episode of the B.S. Report with Bill Simmons a couple of years ago where Simmons had Cuban on. Bill took it upon himself to give Cuban a hard time about Shark Tank because they had just moved the show to Friday nights and it was assumed that it wouldn't be long before it was cancelled altogether. Cuban insisted the show was doing quite well, but Simmons didn't seem to believe him. As much as I like Simmons, he missed on that one.
     
  17. rezdawg

    rezdawg Contributing Member

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    One of my wife's friends was on the show a season or two ago...apparently after the show, the sharks changed the terms of the deal and wanted more of a percentage while giving less money.

    It's a crappy process for those going on there because the sharks literally rape you hard when on the show, and then they go harder after the show. But, the sharks still give them great opportunity to succeed when it's said and done.
     
  18. Yonkers

    Yonkers Contributing Member

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    I've heard of a few deals where it fell through afterwards because the Shark pulled out. One I can remember off the top of my head was the idiot who had a great product but was an ass so he lost out on some stuff. He was the one with the plate topper which you can use to easily store leftovers and reheat them.
     
  19. Hustle Town

    Hustle Town Contributing Member

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    Mark Cuban gave a lecture to entrepreneurs at UT a few weeks ago. He stated that some deals fall through for obvious reasons. For example, one guy told Cuban off camera that he never pays taxes because he believes taxes are immoral. Cuban broke off the deal. He went on to say that deals are broken off, but it is not the norm.
     
  20. Man

    Man Contributing Member

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    Nice, any other interesting things that he spoke about?
     

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