Coolbox Smart Toolbox
DEAL
EPISODE SUMMARY
🕓 Air Date: April 8, 2016
Asking For:
$500,000 for 10%
Investor:
Lori Greiner
Deal:
$500,000 for 15%
PRODUCT SUMMARY
Coolbox is the world's first smart toolbox, integrating features such as power outlets, a whiteboard, lights, iPad and iPhone stands, magnetic lid, USB ports, clock, bottle opener, and wireless Bluetooth speakers.
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Background Story
Coolbox founders, Jason Neubauer and Chris Stoikos, entered the Shark Tank seeking $500,000 for a 10% stake in their company. Frustrated with the lack of innovation in traditional toolboxes, they aimed to introduce the Coolbox as a smarter, more versatile alternative. The product boasted a comprehensive set of features designed to cater to the needs of blue-collar workers, offering functionality beyond conventional tool storage solutions.
Neubauer and Stoikos explained their journey, highlighting the challenges of innovating a product that had remained largely unchanged for over a century. They shared that the Coolbox had already generated significant interest, with presales reaching over $370,000. The founders emphasized their commitment to improving the traditional toolbox and how their product addressed the practical needs of users on job sites.
The Product
The Coolbox is a smart toolbox with various features, including a power cord with pass-through power points, rugged latches, a whiteboard, lights, iPad and iPhone stands, a magnetic lid for holding screws and bolts, USB ports, a clock, a bottle opener, and wireless Bluetooth speakers.
The toolbox’s design aims to maximize utility and convenience for users in different work settings. While the cost was stated at $110, the retail price was planned to be $249.
How It Went
The company’s position before Shark Tank
Coolbox had secured a significant order of 8,000 units from Lowe’s, a major retailer. However, this order was contingent on a Q4 exclusive, and the founders were in the process of finalizing the details. The company had not yet shipped any units but had presales exceeding $370,000. The founders acknowledged the need for additional funding to meet demand and fulfill orders, stating they were in the process of raising a total of $1 million.
The Negotiations:
The Sharks expressed concerns about the high valuation of the company at $5 million and the lack of patent protection for the product. Daymond John offered $500,000 for 25%, contingent on licensing. Lori Greiner also made an offer of $500,000 for 20%, contingent upon securing purchase orders from Lowe’s. However, as the negotiations progressed, Lori revised her offer to a $500,000 line of credit at 5% interest and 15% equity.
The founders ultimately accepted Lori Greiner’s revised offer. The negotiation process involved challenges and scrutiny from the Sharks, with concerns raised about the product’s market viability, patent protection, and the company’s financial structure. Ultimately, Coolbox secured a deal with Lori Greiner, providing them with the funding needed to move forward with production and distribution.
