'Shark Tank': Lori Greiner wishes to make Slick Barrier a consumer product, invests $500K in Arizona dads
LOS ANGELES, CALIFORNIA: 'Shark Tank' season 14, episode 13 featured entrepreneurs Aaron and Tony Gonzales pitching Slick Barrier, a one-of-a-kind solution to controlling pests. While pests, particularly scorpions, are harmful and can pose a grave threat, the two devised a practical and inventive approach to keep such creatures out of one's home. Furthermore, Slick Barrier is appealing because it eliminates dangerous insect management methods, such as pesticides, for a more child-friendly approach. Even though none of the Sharks thought the firm is worth investing in, Shark Lori Greiner saw a chance for it to be a good consumer product.
Aaron and Tony began their firm as a side project in 2018. It was named 95 Applications back then, and the co-founders had to confer with various chemists and go through multiple prototypes before coming up with a solution that worked well. Surprisingly, the product was favorably accepted throughout its early phases, prompting Aaron to resign from his job and devote full-time attention to Slick Barrier in 2020. Similarly, in 2022, Tony resigned from his law firm partner position to join Aaron as a full-time businessman. So, how did they manage to walk away with a single deal awarded by the Shark panel?
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The Arizona dads stepped into the Tank and demanded $500k for 10% of their company. They made certain to offer the Sharks a thorough demonstration of their product. Sharks Mark Cuban and Robert Herjavec were afraid that pests and insects might enter through pipes or holes in the world, but they created a product that would conceal the exterior of the house. The entrepreneurs said that every creepy crawler comes in from the ground up, which is where Slick Barrier can be applied. Mark, on the other hand, was impressed by the product testing findings.
In 2020, their first year in operation, they made $180,000 in sales solely via service because they were not selling the product. In 2021, the overall income was $650k, with the service accounting for $450k and the remainder generated from product sales. Pest control firms purchased the items. They planned to focus exclusively on selling the product in 2022, so they sold around $50,000 of their latest product in one month. Their plan is to market the product to consumers, but they will continue to focus on pest control.
Shark Kevin O'Leary chastised them for such a high valuation given their lack of sales. When they discovered the items worked, they started seeking funds. They raised roughly half a million dollars before the end of 2020, and the most recent one was $700,000 at a $3 million valuation. The average price they charge pest control firms for their products is $70. The end user payment is around $1400, which covers the service, but they do not receive a share. Mark thinks that's 'insane'. He adds that they will have to sell so much to justify their valuation, thus he declines to make a deal. Right now to get the product to have transported to their warehouse they have to pay $30 for one gallon, and they sell it for $100 which the Sharks perceive to be a "huge mistake". Kevin questions if the entrepreneurs are "cockroaches," "scorpions," or both for setting such a high valuation. Robert believes that even if the product is excellent, pests will find their way into a home, therefore he does not sign a deal. Shark Daymond John agrees with Robert and withdraws.
Lori believes the entrepreneurs are desperate for a Shark, so she offers a conditional offer. She offers $500k for 15%, with $100k cash and the rest as a loan, because the product appears risky to her. Her terms include assisting them with licensing as well as becoming a household name as a consumer product. Despite their reservations, they accept Lori's offer.
'Shark Tank' Season 14 airs every Friday at 8/7c on ABC. Missed an episode? Have you been wanting to catch up? Episodes can also be viewed the next day on demand and on Hulu. Not just that, you can also watch old seasons and episodes on Amazon Prime Video and iTunes.