Ring was on the TV Show Shark Tank, and all the sharks passed on the deal. It was $700K for 10% of the company.
And now it sold for more than 1 billion $.
Yep. Richard Branson was the winner on this front. $28 million investment (with a few other investors?) at $60 million valuation (in 2015 ?)
> Siminoff says a Ring customer happened to be vacationing at Branson's island a couple of months ago. He used Ring to talk to a UPS delivery guy who was at his home in San Francisco. Branson, who happened to be next to that person, saw the interaction and was immediately hooked by the product.
> In fact, Branson liked it so much that he asked for Siminoff's email address and soon started talking business with Siminoff. He wanted to invest in the product.
> In less than 48 hours, Branson agreed to join the round. And on Wednesday, Ring made it official: a $28 million funding that gives it a $60 million valuation.
I think the $28 million was for the whole round, not just Branson's part. Though that would be quite the deal if he ended up netting $500 million from eavesdropping while on vacation.
There was just another example of this - A company called Plated, Cuban agreed to invest during the show then backed out during due diligence.
I guess Mr. Wonderful found out and called them up to invest later. Plated just got sold to Albertsons for 300m, and O’Leary claims to have made 1300%+ return on his investment.
Poor Mark.
I love the show, I don’t think any of the sharks are “dumb money,” but I don’t think it’s an accurate representation of what a good investment for most businesses should look like.
Kevin O'Leary is great. If you are on the benefitting side of what people call 'the worst deal of all time', you must be a pretty good businessman[1]. And I bet The Pitch host isn't a member of the Confrérie des Chevaliers du Tastevin.
> I don’t think it’s an accurate representation of what a good investment for most businesses should look like
So, honestly, what do "good investments" look like then?
If anything I think the only problem with shark tank's portrayal of investments is it that it doesn't explain to the audience that it's wide viewership is the largest return for most of the founders on the show. Every founder who goes on the show knows this, but it's the "dirty little secret" that the audience isn't aware of.
I think they have become a little bit better with letting the viewer know this. Cuban fought fairly publicly to retroactively void a term in the first few seasons of Shark Tank where even without an investment from the sharks ABC got a percentage of the company. They also call out pitches where the person has ridiculous terms and is obviously just trying to advertise for free.
One thing that they don't show is that the pitches are substantially longer than what's presented on the show. Much of the drama and speed is down to editing.
You have the wrong idea about the show. It exists to promote the shark's own businesses and products under the guise of a contest reality show. To keep up the facade, they allow other companies to put their products up for a price, and intersperse a couple of silly products to keep people watching.
It's just dressed up advertising, it's not about investing or business by any flip of the coin.
This isn't true, the only thing that is "fake" is how much time they spend asking questions. From speaking to a "dragon", they spend about 45-60 minutes assessing the product/idea. After that, if they choose to invest, they invest.
If that's true, it might not be very effective. Having seen the show a fair few times, I have only the vaguest idea of what the Sharks' interests are, other than FUBU--basketball owner? something to do with QVC?
