'Shark Tank' contestant asks judges for a $1.5 million investment — it didn't end well for him

"Shark Tank" contestants rarely ask for a million, and even then, they have to walk away without a deal, as sharks find their firm's valuation too high. But that is exactly what one entrepreneur did, and asked for $1.5 million for only 5% of the company.

The founder was Joel Pennington, and his company was called Blackdot. It is basically a tattoo machine with can operate without a tattoo artist. Several designs could be fed into it, from which a customer can choose one for their body.

Pennington claimed that customers reported that the process was far less painful in comparison to getting a tattoo done by an artist. He also said that the designs fed into a machine had to be made by an artist in the first place. So whenever a customer opted for that design from the machine, the artist would get a part of the money. As far as the sharks were concerned, this was a great idea.

The problem was that Pennington had no idea how to take the business forward. He said that he would want to lease the machines to tattoo parlours and artists. Each machine cost $120,000 to take, and no one was going to buy one. So, leasing seemed like the best option. When it came to revenue, the entrepreneur revealed that the machine had made over 100 tattoos, which was really not all that much.

Pennington even said that he had raised more than $4 million for the company, which was started 5 years ago. The sharks were confused as to what exactly the entrepreneur had done in the last five years with all that money. Regardless of that, the entrepreneur did not give any pathway on how to make this business model successful in relation to tattoo parlours.

This led to a scathing review by Kevin O’Leary. “You’ve got to deliver some essence of a pathway to where I give you $1.5 million and somehow I get it back times x, maybe 10, 20, 30 times. That’s why I’m an investor. But because you chose such a large number…I got to have some essence of a plan, and you didn’t deliver on that. Very nice guy, very interesting idea…but you just sucked in terms of presentation,” he said.

That pretty much summed up how all of the sharks felt about this deal, plus the fact that the company was valued at a whopping $30 million when it did not even have a solid business model. In the end, nobody wanted to invest in Blackdot.

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