Pete & Pedro – Men’s Hair Styling Products
DEAL
EPISODE SUMMARY
🕓 Air Date: May 20, 2016
Asking For:
$100,000 for 10%
Investor:
Barbara Corcoran
Deal:
$100,000 for 10%
PRODUCT SUMMARY
Pete and Pedro offers a line of super-awesome men's hairstyling products, including six styling aids and a shampoo and conditioner, sold directly to consumers.
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Background Story
Aaron Marino, the entrepreneur behind Pete and Pedro, had previously appeared on Shark Tank in Season 4 pitching the Alpha M style system, which didn’t gain traction. However, he took the Sharks’ advice to heart and realized the need for a lower-price-point product that every guy could use. Inspired while styling his hair one day, Pete and Pedro was born, focusing on men’s hairstyling products.
As a YouTuber with a strong online presence, Aaron has amassed a following of 600,000 subscribers on his Alpha M YouTube channel, generating 5.5 million views per month. Leveraging his social media influence, Aaron created Pete and Pedro, selling directly to consumers and building the Bueno Hair Club, where customers could subscribe to receive their favorite products automatically. The product line included six styling aids and a shampoo and conditioner.
Aaron’s charismatic and engaging personality, combined with his expertise in grooming and style, played a significant role in the success of Pete and Pedro. Despite the initial setback with his previous pitch, Aaron demonstrated resilience and adaptability, turning his failures into valuable lessons and creating a thriving business.
The Product
Pete and Pedro’s product line consists of six different styling aids and a shampoo and conditioner. The products are designed to provide men with high-quality hairstyling options at an affordable price. The styling aids include various products such as pomade and putty, catering to different styling needs and preferences. The shampoo and conditioner are formulated to enhance the overall hair care experience.
The key selling point of Pete and Pedro is the direct-to-consumer model, ensuring customers receive a higher-quality product at an attractive price point. Aaron Marino highlighted the appealing fragrance of the products, describing it as smelling like lime and lemon, contributing to the overall positive user experience.
To boost customer engagement and loyalty, Pete and Pedro introduced the Bueno Hair Club, allowing customers to receive their favorite products through automatic shipments every four, six, or eight weeks. This subscription model aimed to create a steady revenue stream and maintain a strong connection with the customer base.
How It Went
The company’s position before Shark Tank
Pete and Pedro had achieved notable success, with Aaron Marino claiming it to be a $1 million company built in just two years. The company was experiencing rapid growth, with sales currently at $800,000 and a month-to-month growth rate of 15%. This growth was attributed to Aaron’s influence as a YouTuber with 600,000 followers, generating 5.5 million views monthly on his Alpha M YouTube channel and website. The company’s revenue streams were diversified, with income coming from direct product sales and collaborations with brands.
Aaron’s social media presence allowed him to secure sponsorship deals, including a makeover series sponsored by JC Penney and promotional videos for Chevrolet. These collaborations not only added to the company’s revenue but also increased brand visibility. The direct-to-consumer model and the Bueno Hair Club subscription service contributed to the company’s financial stability. Pete and Pedro had positioned itself as a million-dollar business within a short timeframe, demonstrating its potential for continued success in the men’s hairstyling product market.
The Negotiations:
The Sharks were initially skeptical due to Aaron’s previous unsuccessful pitch in Season 4, where he presented the Alpha M style system. Kevin O’Leary expressed concerns about Aaron’s loyalty and time allocation, suggesting that he should focus entirely on the product and not split his attention. Barbara Corcoran, acknowledging Aaron’s social media influence, made an unconventional offer. She proposed investing $100,000 for 10% of Alpha M, Aaron’s social media business, rather than the hairstyling product company.
This offer aimed to capitalize on Aaron’s personal brand and the potential for promoting various products beyond hairstyling. Kevin O’Leary and Robert Herjavec also made offers for a stake in the combined business, but Aaron ultimately chose Barbara’s offer of $100,000 for 10% of Alpha M. Despite the unconventional turn of events, Barbara saw the value in Aaron as a personality and influencer, recognizing the potential for leveraging his platform for various product promotions.
In the end, Aaron accepted Barbara’s offer, expressing gratitude for the opportunity and looking forward to the partnership. The negotiation showcased the importance of personal brand and the influence of social media in the modern business landscape.
