Ben Alexander pitches Balloon Distractions to the Sharks in episode 514 on January 17. Alexander started the business, which sends balloon artists to restaurants and events, back in 2003. He has 7 regional markets open in a franchise-like concept. Balloon artists in each market travel to events which are booked by “the home office.” The business takes a percentage of the bookings and Alexander still works his home market in Florida.
Ben's goal is to expand all over the US with his concept. He provides company training and handles the business side of things; regional partners perform at the venues, sell the concept in their region, hire and train. Balloon Distractions provides training, an online infrastructure, and handles most of the billing. For someone looking to get into a franchise type of business, the entry cost is low. Demand for the company's services are high, with many customers booking on a weekly basis.
Mr. Alexander is likely looking to the Sharks for expansion capital.
Balloon Distractions Shark Tank Recap
Ben comes into the Shark Tank looking for a $250,000 in return for 30% of his company, Balloon Distractions. He gives a very enthusiastic rundown of his company, which trains balloon artists to work in restaurants and other venues to entertain diners and children while they wait for their food.
His enthusiasm causes Kevin O'Leary to worry that he “might spontaneously combust,” but as usual, Mr. Wonderful wants to talk about the numbers associated with the business.
Ben explains that they've been doing over $500,000 a year in sales, with a cumulative sales of over $4 million. The Sharks are concerned when he reveals that his sales have dropped from $650,000 a year, due to a changing economy and criticism from the “clown community” online.
He's hiring “regional partners” to go into an area and hire the actual artists, who then manage their own bookings at the restaurants. The restaurants are charged $40-60 a night, and the artists work for tips, wearing a pin that says “I work for tips” with a $5 bill attached. Ben wants to create franchises for his business.
Mark Cuban is unimpressed with the franchise idea, saying “You're going to make me crazy.”
Robert Herjavec agrees, telling Ben, “You don't need franchises. You an infrastructure, you need people to manage.” He says “You're a great salesman, but you haven't shown me how I can give you $250,000, and get a great return. I'm out.”
Barbara Corcoran believes that Ben is a “phenomenal salesman” but “not a sales manager.” She's out.
Lori Griener doesn't understand the business model. She's out.
Mark Cuban believes the business is “structured wrong.” He tells Ben to go find “the best recent college graduate management talent you can find,” and put him in charge of recruitment. He doesn't believe Ben is ready, and he's out.
Kevin O'Leary agrees. He doesn't believe Ben's business structure is working, either, and doesn't believe he's ready. He's out.
Balloon Distractions Shark Tank Update
Ben leaves the Tank with no Shark deal, but he continued working with his business. The social media is quiet from Balloon Distractions, but the website still appears to be active, and a blog entry explains that Ben is taking some time off from blogging to work on a book, and to focus on his “Life Leadership” activities.
It seems as if the Sharks were right on the money with this business. It's a business model that has upset some in the community of artists who participate in restaurant shows and other events, because the idea of working for tips is foreign to many of them. Some of the disagreements have erupted into online flaming matches, with professional clowns and balloon artists making Youtube videos criticizing and mocking Balloon Distractions in response to threats of legal action. Alienating the very people upon whom a company relies on for talent seems a poor business strategy in the long term.
Ben's own lack of experience in management is offset by his skill in sales, but is it enough to keep this balloon business afloat and growing over the long term? Only time will tell.
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