I enjoy the Shark Tank and the idea of “the little guy” getting a chance to take an idea or an invention to the next level with the significant capital and expertise of the sharks. Unlike my co-author, Kirk Taylor, I don't do any back end research on the would be investors; I like reacting purely to what I see on the screen when the show is broadcast.
Friday's episode featured Kevin and Mellissa Keirnan, the inventors of The Last Lid. Their segment started off with a cute video and a slick pitch. The clownish background music and the sarcastic quips from the sharks gave this product a campy introduction. I didn't like their chances based solely on the production editing. There were immediate objections and derogatory laughter from the sharks. Robert got out immediately.
Then the begging began. And Lori , the TV sales expert on the panel, bailed quickly followed by the rest of the sharks. When Daymond was the only one left, Mr. Kiernan dropped his pants and gave away 60% of the company, much to the chagrin of his wife. Daymond John was soundly mocked by the other sharks.
What struck me most about this pitch, is there was really nothing more than an idea and a cute video. The sharks want numbers, they want past sales figures to scale the value of their investment. There was no real meat to this presentation and the product itself was nothing more than a piece of heavy-duty cloth and a couple of clips to hold it in place.
Melissa was heard to say “you just gave away 60% of the business,” to which Kevin replied “who cares!” Who cares indeed- there is really nothing here-yet. Mr. Kiernan strikes me as a good salesman with an idea and a passion for a product, but not much of a businessman in the ways and means of bringing a product to a mass market. I would be willing to bet he has a stable of products or ideas for products “in the can.” Normally, I would scoff at an entrepreneur giving away 60% of their business but Kevin really had nothing more than an idea.
The key to this whole pitch was the very telling words of Daymond after being mocked by the other sharks. He said he invested because he had recently looked for a replacement top for his garbage cans- with no success. Daymond needed this product. This is one of the oldest reasons for starting any venture or creating any product: FIND A NEED AND FILL IT. Mr. Kiernan found a need for 20% of the sharks and he filled it.
As the owner of three lidless trash cans, I could identify with Daymond and see the NEED for this product. Even if it was nothing more than a concept as of Friday's show, Mr. Kiernan found a need, filled it, and secured the funds to get it off the ground while securing Daymond's access to retail channels. Daymond John, as a clothing mogul, can probably be very helpful in sourcing manufacturing for what is basically a “hat” for trash cans. I have no doubt that this product will find its way onto the shelves of stores like Walmart, KMart and perhaps even the Home Depots of the world. For folks looking for trash can lids, two Last Lids for eleven bucks is not only a drop in the bucket as far as a household spend goes, but a guaranteed workable solution.
There are around 115 million households in the USA. I will be conservative and guess that at least 50 million of those households have at least one trashcan. If I rather unscientifically project the need for this product, based on the percentage of sharks who needed it, at 20%, then there are 10 million households out there that need a new trash can lid. That is quite a few potential customers. If they achieve 1% market penetration, they'll sell 100,000 units (two lids per unit). At eleven bucks a unit, that's $1.1 million in sales-probably about $300,000 in profits on that run of sales. Kevin and his wife clear $120,000 on that deal. Not bad for sewing together some heavy duty cloth and putting together a cutesy video and a quick presentation.
The best part is Mr. Keirnan will now have credibility AND a sales channel for future ideas which, if he has half a brain, will be exploited solely for his gain. Daymond walks from the deal making $180,000 under this scenario and gets his replacement trash can lids. They'll both benefit from additional sales as well.
But wait-like most As Seen on TV type products- there's more. At the price point Mr. Keirnan is at, sales of 1 million units or more seems utterly attainable. For a guy who had a lot of sizzle, but not much steak for the sharks, I'd say he made out OK.
All he did was find a need and fill it- with a little help from the sharks.