Kelly McGee and Cristina Asbaugh Present Yardsale On Shark Tank Season 16
Highlights
- Kelly McGee and Cristina Asbaugh present their uniquely created magnetic ski poles on Shark Tank Season 16.
- Yardsale is only six months old during its Shark Tank appearance.
- The founders bring in their best negotiation skills during the bidding process.
Overview
| Category | Details |
| Name | Yardsale |
| Founder | Kelly McGee and Cristina Asbaugh |
| Industry | Winter Sports Equipment |
| Product | Magnetic Ski Poles |
| Funding | Self-funded |
| Investment Ask | $200K |
| Equity Offered | 10% |
| Valuation | $2 million |
The entrepreneur duo of Kelly McGee and Cristina Asbaugh appeared on Shark Tank Season 16 Episode 3, pitching for Yardsale. The company offers a line of ski poles with modernized features that meet the needs of recreational skiers. They started their pitch by discussing the drawbacks of traditional ski poles.
They listed out the poles’ clunkiness, cheap materials used, availability in limited colors, ‘ugly’ appearance, and the fact that they drop easily. Calling themselves ‘lifelong skiers,’ they claimed that people are constantly looking to update their ski gear.
As per the duo, the solution to all these problems is Yardsale. Its innovative ski poles blend clever designs and great style for the everyday skier. Its standout feature is that it is magnetic, with hidden magnets in the handles and the baskets.
This way, the poles are attached together, making getting off a car and on and off the lift easy. Plus, users can mix and match between five colors on the Yardsale website to create custom pairs. Kelly and Cristina want to make Yardsale a lifestyle brand for all recreational skiers.
Yardsale: What Happened On Shark Tank Season 16
Kelly and Cristina appear before the Shark Tank cast, seeking $200K for 10% equity. Mark Cuban wants to know why they chose the name ‘Yardsale.’ Ski lover and Guest Kendra Scott answers him that a yard sale is when you lose everything and your skis and poles come off.
Cristina then adds that it is an ‘insider term.’ Kelly then remembers how they came up with the idea. Cristina says that once she had a bad yard sale, her poles came off, which made her think of the magnetic pole idea.
Kendra wants to know whether the founders are the only people who have the idea. They reply with a ‘yes.’ Kelly reveals that he is an MIT alumnus and has previously worked as a product designer at Apple. Cristina hails from a marketing background.
60% of their online customers customize their poles, hinting at their huge adoption rate. Kevin O’Leary wants to know about their retail presence. Kelly says Yardsale is present in a few specialty stores. Lori Greiner wants to know about its pricing compared to a regular pole.
The company was launched six months ago. The poles are made for $30 and have a landing cost of $42. They are then sold for $139. The margins are 75%. At the lower end, ‘cheap’ aluminum poles cost $50-$60. On the upper end, the poles are advanced.
Kendra then inquires about the sales made. Right before the holidays this year, which marked the first month of Yardsale, witnessed $100K in sales. Mark and Kendra are impressed. Sales from the fiscal year to date saw $220K sales. By the year-end in September, they are forecasting $300K.
Yardsale founders project $2.1 million in sales in 2025. To date, they have been selling D2C only and will expand to retail by next winter. Kevin wants to know about their allies. Cristina says that in their first 30 days, REI reached out to them, and Backcountry and Decathlon also contacted them.
Kevin wants to know if they need poles of different sizes in the inventory. The products do come in five sizes, but Kevin feels that is an ‘inventory nightmare.’ Kelly says their solution is adjustable ski poles.
Right now, this feature is only available for kids’ poles, but they will soon offer adjustable ones for adults as well. Kendra feels the feature is ‘amazing.’
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Did Shark Tank Season Invest In Yardsale?
Lori is the first shark to opt out of the Yardsale Shark Tank deal. She does not like the brand name, as it seems to give a negative and incorrect connotation for a premium-quality, innovative item. Lori feels ‘Yardsale’ sounds like a ‘disaster.’ Plus, she is not a skier and is thus not passionate about the product.
Daymond John loves the name ‘Yardsale,’ and it reminds him of his similar experience with ‘FUBU.’ But he loves snowboarding and is not game for ski poles. So, he exits the deal as well.
Mark, too, is out of the deal as he is not a fan of skiing.
Kendra says she ‘loves’ the name but feels Yardsale is still in its early stages, and the valuation is high. So, she steps out of the deal.
Hearing this, Kelly says they have a large profit margin and a secondary offer for Kevin. Daymond wants to know if he is hinting at a royalty deal. The founder agrees and proposes $200K for 5% equity with a $3 royalty till he recouped the invested amount.
Mark says that is the ‘first time’ a company has ‘offered’ a royalty deal to Kevin. Kevin counters the offer with $200K for 20% equity, and he wants to distribute the products. Kelly replies, saying they will talk about this and want someone who is ‘ready to roll his sleeves up.’
Kevin then responds, saying he does not want a ‘job.’
Kendra feels the founders’ target area should be wholesale. Kendra says she will offer $200K for 20% equity along with a $3 royalty. Kevin then reduces his equity ask to 15%, but he wants the $3 royalty.
Kelly counters Kevin with $200K for 8% equity at a $5 royalty per unit. Kevin says he can do it for a 10% equity. Replying to his counter offer, Kelly claims that through the $5 royalty, they can help him get his $300K back.
Hearing this, Kevin strongly responds, saying, ‘Getting my money back is not why I do deals.’ Instead, he does it to ‘get a multiple on it.’
When they fail to reach an agreeable deal, Kelly asks Kendra if she will do it for $200K for 8% equity with a $5 royalty till she gets back her $300K. She likes the offer, but she wants 10% equity.
Kelly says they can do the deal if can do it for $250K on the royalty payback. Kendra stands firm at $300K. The final deal is done for $250K for 10% equity at a $5 royalty till she recouped $300K. While the entrepreneurs are heading back, Daymond makes a funny comment saying, ‘ You skiers deserve each other.’
More products from this episode! Check out other businesses that participated alongside Yardsale.
