'Shark Tank' star Kevin O'Leary slams founder for rejecting his deal in wild TV moment: "You're dead to me..."
Kevin O’Leary may be known as Mr. Wonderful but the way he scrutinizes businesses and criticizes founders is far from pleasant. The celebrity investor is notorious for being unfiltered when it comes to sharing his opinion on businesses and products that come into the "Shark Tank". He is also known for offering classic deals that demand a large bite out of a business. This naturally leads to rejection from the entrepreneurs, which O'Leary doesn't seem to handle well.
In this particular episode from the earlier seasons of "Shark Tank," entrepreneur and founder of 'Graffiti Removal Services' Paul Watts, was pitching his franchise business model. Watts came with an ask of $350,000 in exchange for 15% equity, which he would soon realize was too much.
Watts shared that he came up with the idea when he was contracted to clean up the graffiti of a city. He thought it could be a lucrative business that provided a service to the community and made money on the side. Thus, he launched Graffiti Removal Services, which uses a proprietary, non-toxic, eco-friendly chemical to remove graffiti without harming the surface underneath. Soon, after the pitch, Sharks started to question the idea.
O'Leary started by asking how many franchises Watts had sold. The founder said that he hadn't sold any as the franchise was approved only a month ago. Robert Hervajec asked if the company manufactured the proprietary chemical and Watts again responded with a no, as it was manufactured by another company, which didn't sell it in retail stores.
Since Watts had sold no franchises and didn't have a truly proprietary product, the Sharks lost interest. Barbara Corcoran was the first to drop out saying that the business wasn't sustainable. Another Shark dropped out citing similar issues. Daymond John also pulled out saying that the moment Watts' business becomes popular, the manufacturer of the chemical will start selling the product in retail stores. "You got nothing proprietary here," John said, leaving only Hervajec and O'Leary interested.
Both Herjavec and O'Leary had a problem with the valuation of the business. While they believed there was a way to make the business model work, they weren't willing to overpay. Hervajec was the first to offer a deal, asking for a whopping 75% for $350,000.
O'Leary joined Hervajec in the deal, offering to go in as a partner. This meant that if Watts accepted the deal, he would essentially be working for the two sharks. However, Watts wasn't too keen on that and he chose to turn down the offer and walk away empty-handed.
Hervajec and O'Leary tried to convince him and urged him to rethink it. "There's nothing to think about here, No!" Watts said. This is when O'Leary lost it. "You’re dead to me if you turn around," he yelled.
He further added that he will never think about Watts or his business again and other entrepreneurs will get rich off his money, but not Watts. All Watts had to say in response was, "Every time you see graffiti, you’ll think, I should’ve invested in that company," but O'Leary disagreed.
In the end, Watts walked away proudly, keeping the majority stake in his company. Later in an interview with Wallet Prop, Watts expressed that the sharks made a huge mistake as his business took off after the episode aired.
