The following are actually REAL negotiations between entrepreneurs and investors (Guppies & Sharks). The sharks invest their own money at their discretion. The guppies get devoured into a belly of finance, or spit back into the ocean of hard knocks to fend for themselves. The entrepreneurs must convince the sharks to invest the FULL AMOUNT, or walk away with NOTHING.
CHECK OUT THE SHARK FINS SECTION FOR ARTICLES AND INTERVIEWS. ALSO CHECK OUT THE SHARK TEETH SECTION FOR HELPFUL TOOLS OF THE TRADE.
THE GUPPY: James Martin
THE COMPANY: Copa Di Vino
WEBSITE: www.copadivino.com
SYNOPSIS: Copa Di Vino allows wine makers to package wine in ways they've never been able to before.
SEEKING: $600K for a 20% stake
PRODUCT/SERVICE: Copa Di Vino is america's first premium wine by the glass. It's designed and packaged to be conveniently opened and enjoyed anywhere. Copa Di Vino is a winery that makes and packages it's own wine in a revolutionary packaging system.
WHAT'S THE SKINNY?: Copa Di Vina's winery makes about 2,500 cases of wine a year. In the first 6 months they've sold products into 26 states with the largest distributors in the country. He buys fruit from his friends with vineyards. They have 3 different revenue streams: The ability to license, bottle for an industry, and launch their consumer brand. Copa Di Vino's consumer brand is bringing in sales. It has been in the market for 5 months, and had $1/2 Million in sales, and over $800K worth of orders. It's selling at all the Kroger chains, Ralph's and other chains. The wine stays fresh for approximately 1 year and the package is patented. They are working on projects with 2 of the 9 largest wine companies in the world. Estimates next year are between $3-5 Million of sales.
BUSINESS MODEL/HOW DOES IT MAKE MONEY?: They are the first to do wine by the glass. A huge opportunity and a huge market.
STATS: Wineglasses floating in the Sharktank? Self-contained pre-packaged glasses of wine that is. Who will be the first to sip on the revenues streams of this innovative idea? Daymond is the first shark to back out. Kevin, a wine enthusiast, likes the patent but dislikes the wine. He would like to pull the patent from the product and sell the packaging system to wine companies around the world. Mark and Kevin both seem to want to do the same thing. So does Robert, but Robert feels that James doesn't want to separate the wine from the intellectual property, so he's out. Barbara backs out as well. Kevin wants to separate the packaging system (the intellectual property) and leave James the wine company seeing the real profit in the IP (Intelectual Property). James holds out holding on tooth and nail to the whole opportunity he's presenting. He see's the amount of money he'll make on the IP side as far smaller than what he could make with the whole system. But Kevin comes back with a very enticing offer. He wants to isolate the IP and buy 51% for $600K and take his chances on licensing the IP to everyone in the wine industry. He'll still let James run his brand and James will also get 49% of what Kevin will bring in from the licensee's! Mark says he'll never do a deal like that and he backs out. Four sharks are out. This sounds like a sweet deal but James just won't bite. He could take the $600K and use it on his brand, and still make money from Kevin's end of the deal! But James doesn't want to give it up. He wants his company to stay integrated into the other aspects of his business. It's ALL or nothing with James. Kevin asks him to make a counter offer and James counters with a whopping $3 Million!!! Kevin says forget it, he'll never do it and he's out. The Bull Shark then boasts that he's going to go out and buy a $1,000 bottle of wine just to help him forget this guppy. James walks out without the investment.
CAME IN SEEKING: $600K for a 20% stake
WALKED WITH: Alcohol on his breath
GRADE: (Guppy): C
GRADE: (Sharks): Not Applicable
COMMENTARY: This was a tough one to call. I would have personally jumped on Kevin's offer but maybe James saw a bigger picture in his vision. Who knows? Maybe the money really was in the whole brand. Only time will reveal. I really don't know if he should get a C or an A!? What do you think?
"We all need money, but there are degrees of desperation." - Anthony Burgess
CHECK OUT THE SHARK FINS SECTION FOR ARTICLES AND INTERVIEWS. ALSO CHECK OUT THE SHARK TEETH SECTION FOR HELPFUL TOOLS OF THE TRADE.
WHAT DO YOU THINK? COULD HE HAVE GOTTEN THE CAPITAL (OR HIGHER) WITH A LOWER STAKE? WHERE THE SHARKS FAIR IN THEIR NEGOTIATIONS? SHOULD HE HAVE TAKEN KEVIN'S OFFER? POST YOUR COMMENTS AND TEST YOUR NOODLE AT THINKING LIKE A BILLIONAIRE...........
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