A mom and son duo were so impressive on 'Shark Tank' that Lori Greiner gave them her Golden Ticket
Even if entrepreneurs make an impressive pitch on "Shark Tank," it doesn't guarantee that the sharks will hand them the investment that they seek, on their terms. But while the celebrity investors are very hard to please, Lori Greiner does give entrepreneurs exactly what they ask for if the pitch is the best that she has seen all season, and she calls this her Golden Ticket. So far, only a few have managed to bag it, and the founders of "Rinseroo," who flattered the shark right from the start of their pitch, are among them. In the end, the mom and son duo of Lisa and Jake Lane got the ultimate reward of $343,000 on the show.
In the episode, Lisa and Jake entered the tank seeking $343,000 in exchange for 5% of their company, "Rinseroo." They began their pitch with a demonstration that stressed how difficult it was to rinse shower walls and bathe pets with a simple bucket. To solve this problem, Jake pulled out the Rinseroo, a slip-on hose that makes rinsing and bathing much easier. The product came with a sprayer nozzle attached to any water outlet including a shower using a stretchy rubber attachment. The device then acts like a hose to make rinsing easy.
Lisa shared that she got the inspiration for Rinseroo while she was vacationing at their beach house. Instead of enjoying herself at the beach, Lisa often found herself cleaning the family's dogs and the shower with a bucket. Determined to find a better way, she recruited Jake and the two came up with the idea of Rinseroo, a quick-connect, no-installation hose. After making a successful prototype, Lisa shared that they bought Greiner's book "Invent It, Sell It, Bank It!" which guided them to scale their business. "We read about how to check if your product is a hero or a zero, and we found out that ours was a hero. It is a mass market, demonstrable, and it solves so many problems!" Lisa said. This instantly impressed Greiner, who was flattered by the compliment. “You know your stuff. I love it," she told the duo.
When Kevin O'Leary questioned the company's $6.8 million valuation, Lisa explained that there was good reason behind it. She shared that in the first year itself, they sold more than $1 million worth of products, and they were on track to make $5 million from sales by the end of that year.
Furthermore, they had a healthy 85% profit margin, which made them $1 million in cash profits. Another impressive quality was that the business was run by them alone, and they only sold directly to customers. Lisa shared that their customer acquisition cost was $2.50, and their return on ad spend was 10 to 1 on Amazon.
After this, O'Leary raised a concern about knockoffs, which was acknowledged by Jake. The co-founder shared that while there are many knockoffs, they have a patent and a protection service that instantly takes them down. With everything laid out, the Sharks began making offers. Daymond John was the first to make a move, as he offered $343,000 for 20% equity. O'Leary quickly countered by offering the same deal for 15% equity. However, Lisa wasn't willing to give up so much of the company as she stated that it was for the future of her kids.
In response to this, John adjusted his offer to 15% while O'Leary proposed a royalty deal that would take away only 5% equity, "So, I'll give you $343,000 for 5% equity, but with a $2.50 per-unit royalty until I make a million bucks," he said. Since the royalty was hefty, Lisa hesitated to move forward, which is when Greiner jumped in.
The Shark surprised everyone with the line "I don't do this often," prompting Lisa to say, "Is it the Golden Ticket? We wished that you would give us the ticket!". Greiner then pulled out her Golden Ticket.
She complimented Lisa and Jake for building a successful business, saying, “You followed my book. You did everything right. You are the perfect entrepreneur. You were successful." With this, Greiner agreed to give them $343,000 for 5% equity.
In the end, Lisa said that her goal from the get-go was to partner with Greiner as she believed together they could get Rinseroo into every home in America.
