Kent Frankovich wheels into the Shark Tank in episode 521 peddling his bike safety lights called RevoLights. The LED, battery-powered lighting system attaches to the wheels of a bicycle with the front wheel lights acting as a headlight and the rear as a brake light. The lights clip to the spokes and stay in a “fixed” location with magnets. The power pack fits in the hub of the wheel and the batteries re-charge with a removable USB charger.
Revolights got their start via funding from not one, but two successful Kickstarter campaigns. Their first campaign in 2011 raised just over $215K and their second, in May 2013 netted a little over $94K. Currently, Revolights only fit 27″ rims, but they do sell bike wheels with lighting installed directly in the wheel. They have plans for many other sizes and they are working on having a self charger integrated into the battery system.
Revolights Shark Tank Recap
Kent rolls up on the Sharks looking for an investment of $150,000 in return for 10% of the company. He explains that 70% of car on bike collisions are caused by inadequate side illumination. He shows a video demonstrating the visibility, and invites the Sharks to demonstrate the RevoLights on a stationary bike, an offer that Daymond John takes him up on.
Kevin O'Leary, Lori Greiner, and Robert Herjavec all take a closer look, and Kent passes a sample wheel around to the Sharks. He has two patents, and is considering marketing the concept to the two major bike manufacturers. Kent assures Kevin O'Leary that the Revolights are designed to thwart bike thieves. The Sharks are impressed with Kent's answers so far, but as always, sales numbers make or break an entrepreneur in the Shark Tank.
In a year's time, Kent has sold $600,000, nearly exclusively online. Each light set costs $139 per wheel, or $229 for both front and back sets together. The units cost $100 for the complete set, but the company is not yet profitable, because Kent has been re-investing and growing the company.
Daymond John makes an opening bid, offering Kent $300,000 for 30%. Kent hesitates. Kevin O'Leary jumps into the gap. He offers Kent $150,000, with a 7% royalty until the investment is repaid. The royalty would then drop to 1% in perpetuity.
Kent thanks both Sharks for their offers, but he fears the royalty could drain the cash the company needs to survive and thrive in its early stages.
Robert Herjavec makes an offer of $300,000 for 10%, saying Kent has undervalued the company. Daymond John comments on Herjavec's “trying to undercut me,” saying “You better put in your mouthpiece because this is about to get ugly.”
Although it seems as if John is going to fight for a piece of RevoLights, he backs down and says that Herjavec has made a better offer and rather than fight, he'll withdraw. Kent waits to see what the remaining Sharks have to say.
Mark Cuban tells him he's “crazy” to ask for so little, and accuses him of purposely undervaluing the company and using the Shark Tank for exposure rather than actually seeking an investment. Kent explains that he does need the capital, but he also needs the Sharks' expertise and marketing. He accepts Herjavec's offer and lands a Shark Deal.
RevoLights Shark Tank Update
Not only did Kent successfully close a deal with Robert Herjavec on his RevoLights, he went on to raise an additional $1 million through “Angel” investors in 2014. While RevoLights are no longer available through Amazon, the light sets are readily available through the website, and from brick-and-mortar stores. REI is a big carrier of the lights, and they are also sold in many specialty bike stores around the country and around the world. RevoLights looks to be an excellent investment for Robert Herjavec, one that will light him up all the way to the bank.
Posts About Revolights on Shark Tank Blog