Tag Archives: small business

Help Support Odyssey Solutions in the Intuit Small Business Big Game Contest

Help Support Odyssey Solutions in the Intuit Small Business Big Game Contest

Readers, 

I am asking your support for Odyssey Solutions in the Intuit Small Business Big Game contest. The winning company will get a commercial during the Super Bowl. We made it to the second round so every vote counts.

https://www.smallbusinessbiggame.com/TX/Odyssey-Solutions-LLC/374168

Much Thanks

Sean

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Shark Tank Review Episode 303 – January 1st 2013 (re-air)

First and foremost, Happy Holidays and especially a Happy New Year to all of my loyal readers. The start of a new year should be a sign for other entrepreneurs to take the step towards independence. I wish you all a prosperous 2013 with you endeavors and / or inventions.

So this episode was a re-air from the third season but considering it was airing on New Years Day, it gave us another dose of the show prior to the all new episode this Friday. This show gave us a little of everything; seasoned successful business owners looking to partner with someone with global exposure, Inventors with a great product in a fantastic market segment and even a product that might need to go back to the drawing board before it makes it big. Without further ado, lets see how it all panned out….

Inventor: Kevin and Melissa Kiernan

Product: The Last Lid (http://www.lastlid.com)

Requesting: $40k for 20% stake

The Last Garbage Lid you Might Ever Need

The Last Garbage Lid you Might Ever Need

Melissa and Kevin entered the tank to discuss the product that was developed to address a need to keep raccoons from opening and knocking over their trash cans every night. Additionally, they would often lose the lids for their trash cans and apparently you cannot buy just replacement lids for trash cans. After some testing of materials and finding which design was most effective they settled on the elastic banded, polyurethane cover that would replace the need the for the hard plastic covers. They just launched the product, with no sales to date or IP. One by one the Sharks bail out of the pitch until only Daymond is left and he asks the two if they would take a minute to propose a final offer. Kevin said “$40k for 60% stake!”. Daymond agreed.

Feedback: While I love the fact they the Kiernans took a problem and created and tested a solution, I don’t like the resulting product for a number of reasons. First, the sagging fabric will get filed with rain water and make a mess. Second, the fabric regardless of whether it is water proof /resistant will leak the odors which I hate (ultimately promoting more Racoons to come by and check it out). Finally, I am not sure on what basis Daymond thought this idea had a valuation of roughly $67k with no sales and nothing protected in intellectual property in the way of a patent. The concept is a good one but, I think a better and more cost effective solution would involve an elastic domed disk that can be attached to any type of trash can.

Inventor: Amanda Schlechter

Product: The Ledge Pillow (http://www.ledgepillow.com)

Requesting: $30k for 25% stake

The Only Pillow that Doesn't Get in the Way...

The Only Pillow that Doesn’t Get in the Way…

Amanda entered the tank with a beautiful model by her side to demo the Ledge Pillow, a contour designed pillow for stomach sleepers with large breasts or augmentation. The idea is that many women now have breast implants and as a result cannot not sleep on their stomach comfortably. The company was formed in 2008 and has 83 pillows sold to date. Mr. Wonderful started by telling Amanda that the sales history and the small niche market was not enough to keep him interested. The other Sharks followed by not partnering with the Ledge Pillow.

Feedback:  This pitch to me was very tough to watch because Amanda appears to be very passionate of the product yet she has not taking the risk personally to see if the product would sell. During the 3-4 years that the product was out (with a patent as well), she didn’t spend a lot of time or money to perform a market analysis that may have helped to better understand who are the intended buyers. In reality, had she been able to invest more of her own money into advertising to boost sales over the 83 unit mark the pitch may have gone better. I wish her the best of luck and recommend that she take the risk to fully “live” her product 24/7, meaning cold calling store owners, retail buyers in her local market to setup a case study of sales history.

Inventors: Steve Nakisher and Shane Talbott

Product: Talbott Teas (http://www.talbottteas.com)

Requesting: $250k for 20% stake

Designer Teas by Talbott Teas

Designer Teas by Talbott Teas

The company Talbott Teas was created by the two partners to serve the designer tea market. The products are whole leaf tea blend created by Shane Talbott with a total of 23 different flavors available. The two were fortunate enough to be chosen as one of Oprahs favorite things in 2009 which led to an instant boost in sales. In addition they have appeared on QVC on numerous occasions. Sales history: $100k in 2009, $350k in 2010 and $500k through Q3-2011. They are enjoying a 50% gross profit margin at the moment. Daymond jumps in a regretfully bows out due to a conflict of interest with another investment he is in. Mark is also out. Kevin offers the $250k for 40%. Robert and Lori both drop out and it is left to the Talbott Tea owners on whether to accept. They counter twice and settle on a $250k for 35% stake to Kevin.

Feedback: These two owners are an example of found fundamental Entrepreneurs. Not only do they have great trending sales history but, they are very knowledgable of the business side of things too. I am amazed that there are not more competition out there in this segment aside from Teavana. Not only is tea shown to have health benefits but it easier on the stomach. I think this is a gold mine and I imagine more me-too companies will enter the ring soon. I wonder if the two are full-time working for Talbott or not because the intro video had them talking about their professional background. In any event this is a success for sure, Lucky for Kevin to have gotten such a big piece of the pie for only $250k (or roughly 4 months of sales).

Inventors: Maddie, Margot and Diane Bradshaw

Product: M3 Jewelry (http://www.m3girldesigns.com)

Requesting: $300k for 15% stake

M3 Girl Designs Jewelry

M3 Girl Designs Jewelry

Maddie, Margot and mom are M3 Designs a unique interchangeable jewelry company out of Dallas Texas. The company was formed back in 2006 when then 10years old Maddie began creating bottle cap magnets which led to the interchangeable bottle cap necklaces. Since the formation of the company, the product has grown to be representing in over 1000 retail stores nationwide! During this time the company has grossed over $5 million in sales revenue and growing. They Bradshaw’s are now looking to grow the business and lower the unit cost to help target the international markets. With the exception of Daymond, the Sharks are all wanting a piece of the M3 business but it comes down to equity and dollars. Various offers get put in front of the girls involving: Kevin+Lori for 40%, Lori+Mark for 30% then finally Lori+Robert+Mark for 30%. The girls talk it over and decide to take the deal if they can get season tickets to the Mavericks. Mark concedes a better deal, Owners box anytime with friends. The deal is done!

Feedback: It is hard to believe but these two young girls are both millionaires! I love how they are talking about college coming up soon. If this business gets any bigger school is going to be a waste of time. At first I didn’t understand the product but after they showed how the bottle caps can be removed and reattached to the necklace charm, I saw how this would appeal to the younger generation. They mentioned that all of the assembly is taking place in their Dallas facility but, does that mean these are all hand made or are they integrating any automation? I think this could be streamlined overseas for very cheap but I kind of think “Made in the USA” may be worth the incremental cost to be honest. Truly inspiring story and I am eager to see how the company grows in the coming years.

Thanks everyone for reading this weeks post. Stay tuned for weekly reviews of Shark Tank. Make sure you follow this blog, like us on Facebook and follow us on Twitter

Sean Yakeley

If you are an Entreprenuer with a great product idea but, have not made any progress with the development, my company Odyssey Solutions can help. We offer a full turnkey suite of services to help turn that great idea of yours into a product. All while you retain all intellectual property. To see our full list of services click the link below.

New Product Development Consulting

 

 

 

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Shark Tank Weekly Review – Episode 402 December 7th

Hey there fellow Shark Tank fans. This week was a double dose of Shark Tank as we saw the new episode air on Tuesday and a re-air episode air at the end of the week. Although this is an episode from back in September of this year, it was very entertaining and provided plenty of interesting learning points to take into account.

This weeks Shark: Daymond John, Barbara Corcoran, Mark Cuban, Robert Herjavec and Kevin O’Leary

So lets get started with the review…

Inventor: Derek Pacque

Product: CoatChex (http://www.coatchex.com)

Requesting: $200k for 10% stake

The CoatChex Ticketless System

The CoatChex Ticketless System

The pitch here is for a unique ticketless coat check system that would eliminate the confusion of the dated ticket system. Essentially, you enter you phone number and name and the module then takes a snapshot of you for the system and you hand over the jacket. Then once you are ready you only need the phone number and name to claim the coat. Derek has zero sales to date and is heavily invested by his past professor from college. He would like to franchise the system and sell each for $1500 upfront. He has been in touch with some regional developers to get the word spread but this model was not very attractive to Mark Cuban. Each coat would check for between $2-5 each time. He would claim a 15% profit share on all business with the franchisees. Derek also mentioned that he has a patent on the system of ticketless exchange (this could be used in other venues and platforms such as concerts and valet, etc,…). Daymond, Kevin, Barbara and Robert all chose to go out. Mark is left and he offers $200k for 33% stake. Derek has to step out to discuss with his partner which advises him to turn it down. To everyones surprise he leaves without any funding.

Feedback: The main lesson here is that working with a partner can sometimes lead to disastrous business decisions. Mark would have added far more value than the relinquished equity. Stubborn Entrepreneurs take a lesson here. Aside from the results, the product is very good especially the non-coatcheck concepts. I looked over the website and they have spent some good money on the web developing and marketing but, without knowing whether they secured any funding outside of the Tank they may not have anything on the backend.

Inventor: Jay Kriner

Product: BevBuckle (http://www.bevbuckle.com)

Requesting: $50k for 10% stake

The BevBuckle

The BevBuckle

Jay entered the tank and begins to pitch his product idea the BevBuckle, a hands-free beverage holder / belt buckle. He said the product is patented and he spent the past 4 years traveling around to music concerts and venues resulting in 4000 units of sales worth $340k in revenue. The buckles cost $10 to make and they sell for between $35-110 (depending on the finishes). His pitch was going well and the Sharks all seemed interested. Jay then pulled out two envelopes (one with the list of retailers including Urban Outfitters and the second listing the major raceways in the country). He said that they all had shown interest in the product. The main problem now is that his last manufacturer delivered 26% defective products. Daymond drops out and so does Mark. Robert offers the $50k for 75% stake. Kevin says he would offer the $50k for no equity but with a 12% royalty off the top of each sale. Barbara then jumps in to offer the $50k for 51% operating stake. After a few moments, Jay choses to go with Barbara.

Feedback: This is one of these ideas that you see and say “why didn’t I think of that?”. From the looks of them, they appear to be pretty well made and included a magnetic closure to keep it shut when not in use. These would be great in college, concerts, sporting events, you name it. The manufactured cost of only $10 is really reasonable and this would allow him to sell them wholesale for between $18-60/unit. Not bad for profitability. I still don’t know if $50k is enough to make much of an impact as I think he really needs a couple hundred thousand to get orders rolling for retailers. This is considering the normal credit terms being 60-90 days. I hope he has found a reliable shop to work with to keep the defects down too. Jay, please send me a sample if you wouldn’t mind!!

Inventor: Todd Miller

Product: Bodywalking (http://www.bodywalking.com)

Requesting: $100k for 10% stake

BodyWalking Institute

BodyWalking Institute

Todd is a certified massage therapist that came up with his own take on the message. He decided that walking on the human back is far more beneficial to the body for the pressure points and relief of stress. His company developed a training program for other massage therapists called the BodyWalking Institute. He has performed 30 training sessions in 7 years and recorded revenue of $1500 per session. The pitch doesn’t impress any of the Sharks and they all opt to back out.

Feedback: I was confused here with what exactly Todd was pitching since body walking massage has been around for a long time. I have gotten one on a number of occasions. It didn’t sound like he manufactures or designed the walking frame which was using to supper his weight during the massage. I just don’t see the target market being that big. I can tell you that the walking massage is not for everyone as it can be far too much pressure and some people have a problem with feet as well. Todd if you are out there please provide a follow-up pitch here to the readers and hopefully you can help clarify some of the questions. Thanks

Inventors: Maria Curcio and Veronica Periongo

Product: Buggy Beds (http://www.buggybeds.com)

Requesting: $125k for 7% stake

The Buggy Beds Detection System

The Buggy Beds Detection System

Maria and Veronica came to the Tank prepared to talk about one of the biggest outbreaks in our country today, bed bugs. They developed a patented, trademarked system of early detection of the nuisance bugs. The product incorporates a non-toxic glue inside of a plastic housing that attracts and traps the bugs for verification that the presence exists. They launched the company roughly 6 months ago and have had numerous tests conducted to validate the product. They price from $6.99-8.99 but cost only $1.35 to make (not bad). They have already booked $150l in sales with $100k of that being profit. They had been selling exclusively on Home Depots website and Burlington Coat Factory but have been expanding over the past couple months. They said they once has an offer for $5 million for the buy-out of the patents and trademarks but they declined. All the Sharks are interested and asked the ladies to step out of the room so they could discuss an offer amongst themselves. Kevin started by offering $250k for 25% with Daymond joining. Barbara then wanted to fly solo and offered a single offer of $150k for 15% but after the women couldn’t decide, she pulled the offer. Then Mark proposed a full 5 Shark offer for $250k and 25% and the offer was accepted.

Feedback: This product is addressing a very large problem that is becoming more and more prevalent in hotels and homes across the country. I am amazed at how fast their company has grown in only 6 months and yielding very good profit margins. The fact that the patent and trademark is registered in so many countries (very thorough and expensive but worth it) they were not messing around on this project. These could really be sold in so many stores (Home Depot, Lowes, Bed Bath and Beyond, grocery, convenience stores, etc,…)  in addition they could partner with all of the major hotel chains which would be huge. I am interested in knowing how the Sharks have helped the company and what the year to date revenues would be. Reviews seem to be mixed on HomeDepot so I would be interested in hearing some user feedback.

Thanks everyone for reading this weeks post. Stay tuned for weekly reviews of Shark Tank.

Sean Yakeley

If you are an Entreprenuer with a great product idea but, have not made any progress with the development, my company Odyssey Solutions can help. We offer a full turnkey suite of services to help turn that great idea of yours into a product. All while you retain all intellectual property. To see our full list of services click the link below.

New Product Development Consulting

 

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Shark Tank Weekly Review – Episode 409 December 4th Holiday Episode

Happy Holidays Shark Tank fans. The much anticipated holiday episode of The Shark Tank aired this evening and as expected, the show was very entertaining. We saw some great product pitches with solid sales, some niche business models that need more time and some hard headed Entrepreneurs that didn’t want to listen to the Sharks had to say. As always read through and make comments with your takes on the products and whether you would purchase any on your own.

Lets get started…..

Inventor: Lucinda Lent and Juliet Boydstun

Pitch: The Coop (http://www.thecoop-la.com)

Requesting: $150k for 15% stake

The Coop LA

The Coop LA

The pitch began with the two ladies describing how they met and how once they became Mothers, the options for social locations for their children and themselves was limited. Most of the play areas were dirty, outdated and with no focus on the Mothers. They came up with the idea for The Coop, a modern play spot for kids with a coffee bar and deserts for the parents. They opened the first location after securing a $125k loan from a bank. They cater to high end clientele and movie stars but want to roll out the idea to all budgets. The typical cost for a 2 hour party rental is $595-4000 and weekend sales are typically around $5k currently. They recorded $350k in revenue and booked between $125-150k in profit after taking in a salary (pretty nice!). They would ideally like to franchise the concept and the money would help fund another location. Kevin said he was very impressed with the numbers but he would be out. Daymond added that he wouldn’t be able to add anything to the business and for that he would have to be out. Robert followed out. Mark thinks the business is god but it needs more time and he worries about the price and the amount of competition, he was out. Last was Barbara who offered an iterating counter-offer. She would give the $150k for 15% with a personal guarantee to be paid back in 2 years. After some discussion between the two ladies, they took the offer. Congrats!

Feedback: Well I can tell you as a father of a 3 year old daughter, this business is one that parents (Mothers especially) will pay for. Take a look at Gymboree or the Little Gym, while they are competition they do not offer a parent friendly aspect which is unique. I do agree with Kevin in the idea that they need to test a few more locations (outside of LA because LA is not a good representation of the rest of the country because of the amount of affluent citizens). I already have noticed Barbara doing a good job of promotion of The Coop on Twitter and Facebook which will have an immediate impact. The reality of the loan terms are pretty harsh with the fact they need to pay in full the loan in 24 months for relinquishing 15% stake in the company but, the marketing they will get from Barbara is worth it. Look forward to seeing The Coop come to Texas!!

Inventor: Donna McCue

Product: Fat Ass Fudge (http://www.fat-assfudge.com)

Requesting: $250k for 5% stake

Fat Ass Fudge

Fat Ass Fudge

The flamboyantly energetic Donna McCue entered the Tank to pitch her unique fudge company to the Sharks. What makes the product so unique is that it is Lactose Free, Gluten Free and made with goats milk. She began to make chocolate many years ago and the name came from a family nickname. she has been selling mostly locally and has 2 Whole Foods stores she is working with at the moment but has yet to break into their nationwide reach. They recorded $60k in sales over the past 12 months. Kevin offered her $250k for 1000% stake, she is confused then he says he is out. The rest of the Sharks do the same. Donna leaves without a deal.

Feedback: Energy, passion, enthusiasm would be some very accurate adjectives for Donna McCue. She undoubtable has a good product that tastes good and touches on the Gluten, Lactose-Free segments which are growing. The problem once again is her valuation of her company. Valuation can only be accurate when it references either sales history or pending / accounts receivable. Having said that, unless she has an enormous amount of non-cash assets such as equipment her valuation of $5 million dollars is just silly.

Inventor: Scott Martin (a.k.a., Scotty Clause)

Pitch: The Living Christmas (http://www.livingchristmas.com)

Requesting: $150k for 30% stake

The Living Christmas Company

The Living Christmas Company

The Tank was full of Christmas trees as a jolly Entrepreneur approached with a long Santa cap and a handlebar mustache. Scott talks about the issue of the annual tradition of cutting down a tree then only weeks later after the holidays have passed it is thrown out. He created a sustainable solution to the problem of deforestation by delivering a living tree with a pot that is only temporarily brought into the home. After the holidays, his company picks up the tree and returns it to the farm where it is fed throughout the remainder of the year until the following Christmas whereby the process repeats. The average cost of the tree rental is $100-200. He had $150k in sales last year with a profit of $33k (no salary taken). He is in need of money for further infrastructure growth to take on more business. Kevin doesn’t like the business because it is seasonal. He is out. Daymond owns a tree farm (yes apparently he does) but thinks the business model has too many unknowns. Robert and Barbara are also out. Mark then asks about how many jobs could be created with the money and offers the $150k for 40%. Scott takes the deal.

Feedback: I really like this concept but, i think he needs to diversify into other non-seasonal products / services. Since I don’t know the first thing about the costs to operate a standard tree farm I would be out of place to provide too much insight here but, I see from the website that Scott has garnered the support of various corporate sponsors and partners which is a good sign. The other thing that concerned me with the finances was the amount of profit (~20% without his salary taken). I think with Mark Cubans support they will be able to find a lean solution to the cash problems. Updates on this one will be greatly appreciated since it is that time of year…

Inventors: Julian Jaccard and Connor Pastoor

Product: Partie Poche (http://96.0.165.69/partiepoche/)

Requesting: $100k for 20% stake

Party Poche

Party Poche

Julian and Connor (two MBA students) are pitching a fashionable, discrete holder for a woman’s cellphone, money, etc,.. The Partie Poche is worn on the leg of the user and virtually out of sight to others. They sold 200 units with prices ranging from $17-36/unit (pricing was incrementally increasing towards the end of the 200 units). A Provisional Patent is in-place. Every time the Sharks began to talk to them about valuation and finances they became very argumentative and arrogant. Julian said she had a meeting with a Nordstrom VP but, didn’t receive a PO because she didn’t have any product. They said the initial product inventory was sold and designed by a freelancer and they didn’t have any more product to sell. A late investment of $50k from some college colleagues which was enough to retain 40% stake of the company (leaving Julian and Connor with a 60% net stake). Kevin was furious and said he was out and forbid the other Sharks to do business with the two. Daymond told them that they were hard headed and he was out. Robert said the two were arrogant and stubborn and he was out. Barbara doesn’t think it will sell and bows out. Mark was left and asked the two to stop talking as he requested them to explain the infrastructure and after the same type of responses as before he says he is out.

Feedback: So many things rub me the wrong way about these two. The first is the attitude of they know it all because they are studying for their MBAs (this was evident when Julian started throwing out financial buzz words). While I am a strong believer in higher education, street knowledge and learning from your failures is far more valuable. The other issue here is that this project does not appear to be a full time venture and the lack of focus on getting additional product manufactured with the $50k investment is perplexing. If I had $50k from an Investor I would find the fastest way to pay them back and that would be through product inventory and sales generation which they appear to have none. This pitch should be an example to other aspiring Inventors to listen to those with knowledge and experience in the business world and don’t talk over them. The final thing, with the airing of the show in the works for some time now, their website is still in Beta mode. Ridiculous! Even bad publicity is publicity and if they couldn’t turn the Shark Tank publicity into money they shouldn’t be on the show.

Thanks everyone for reading this weeks post. Stay tuned for weekly reviews of Shark Tank.

Sean Yakeley

If you are an Entreprenuer with a great product idea but, have not made any progress with the development, my company Odyssey Solutions can help. We offer a full turnkey suite of services to help turn that great idea of yours into a product. All while you retain all intellectual property. To see our full list of services click the link below.

New Product Development Consulting

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Pursuing an Invention Idea? Consider Filing for an LLC…

Ok so if you are seriously pursuing your dream of making that invention idea a real tangible product? One word of advice is to consider filing with your state either as an LLC, S-Corp or C-Corp (in rare circumstances). First, the cost to file in most states is less than $300 (sometimes much less than this), it only takes a simple filling of a form with a check. In a matter of days you can be operating as a small business. Second, one of the main reasons for filing as a limited liability entity is to limit the personal liabilities that would be tied to any financial obligations that you undertake while operating as a business. In other words, in the unforeseen case that your business does not pan out and you can no longer make payments to your creditors, your personal property cannot be used to satisfy debts. Third, the best reason to file as a business is for the tax deduction purposes. All throughout the product development process you will incur expenses (some of them pretty significant) for example; Engineering Fees, Patent Attorney Fees, Prototyping, Sales and Marketing. All of these can be used as write-offs when you go to file your annual tax returns in April. These write-offs will ultimately lower you AGI (Adjusted Gross Income) and therefore lower the required tax payment which will lead to a larger return. 

For a good detailed explanation of the various business types please check out the following article on BizFilings.com: http://www.bizfilings.com/learn/compare-company-types.aspx

Last bit of advice, just because you live and work in one state doesn’t mean you cannot file your company in another, more small business-friendly state such as Delaware. What you will need to do however is work through a registered agent in the state you wish to file in. These agents use a single address with multiple mailbox addresses to help companies legally operate in the desired state. 

Best of luck and as always, feel free to drop a comment and I can help in anyway possible.

Sean

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