invisiPlug
DEAL
EPISODE SUMMARY
🕓 Air Date: January 17, 2014
Asking For:
$125,000 for 10%
Investor:
Lori Grenier
Deal:
$125,000 for 10% with $1 royalty per unit sold until loan is repaid, then $0.25 royalty per unit in perpetuity
PRODUCT SUMMARY
InvisiPlug offers a line of surge protectors designed to seamlessly blend into hardwood floors, available in three colors to match different flooring types.
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Background Story
InvisiPlug, a product designed to seamlessly integrate surge protectors into hardwood floors, emerged from the collaboration between Mike Barzman and Bryan O’Connell, the co-founders based in Los Angeles, California. Both entrepreneurs shared a common frustration with the aesthetic drawbacks of traditional power strips, which prompted them to devise a solution that would blend functionality with design. Mike Barzman and Bryan O’Connell brought diverse backgrounds to the table. Their combined expertise likely contributed to the inception and development of InvisiPlug.
Barzman’s and O’Connell’s individual experiences, possibly in product design, engineering, or entrepreneurship, likely played pivotal roles in shaping the concept and execution of the product. Their inspiration stemmed from a keen observation of the market’s lack of aesthetically pleasing power strip options, particularly for hardwood flooring. Determined to address this gap, they embarked on a journey to create a surge protector that seamlessly integrated into the flooring, effectively camouflaging the unsightly cords and outlets that clutter living spaces.
Driven by their shared vision and entrepreneurial spirit, Barzman and O’Connell set out to bring InvisiPlug to life. Their journey likely involved extensive research, prototyping, and collaboration with manufacturers to ensure the product met both functional and design standards. Despite facing challenges, such as securing design patents and navigating market competition, the duo remained steadfast in their commitment to offering consumers a discreet and stylish solution to power management.
The Product
InvisiPlug revolutionizes the way surge protectors integrate into living spaces, offering a discreet and aesthetically pleasing solution to power management. Unlike traditional power strips that disrupt the visual appeal of hardwood floors, InvisiPlug seamlessly blends into the flooring, effectively hiding unsightly cords and outlets.
The product works by incorporating a surge protector within a sleek, wood-grain printed casing that matches various hardwood flooring finishes. This design ensures that the surge protector seamlessly integrates into the floor, creating a seamless and polished look without sacrificing functionality.
InvisiPlug serves multiple purposes, providing surge protection for electronic devices while simultaneously enhancing the aesthetic appeal of the room. Its discreet design makes it ideal for use in living rooms, bedrooms, offices, and other areas where maintaining a clean and clutter-free appearance is desired.
Customers can purchase InvisiPlug online through the company’s website or select retailers. The product is available in three colors to match different hardwood flooring types: light natural, medium cherry, and dark oak. With a retail price of $14.99, InvisiPlug offers an affordable solution for those seeking both practicality and style in their power management solutions.
How It Went
The company’s position before Shark Tank
InvisiPlug, while innovative in concept, faced challenges during its appearance on Shark Tank regarding its market viability and valuation. The company had generated over $10,000 in gross sales within 6 1/2 weeks of launching, with an exclusive deal in progress with Costco. Despite this early traction, concerns were raised about the scalability and long-term profitability of the business model. The Sharks expressed skepticism regarding the company’s ability to compete in a market dominated by established players and questioned the demand for a niche product like InvisiPlug.
Partnerships and distribution channels were limited at the time of the pitch, with Costco being the primary retail partner. The founders mentioned an exclusive product deal with Costco for a special design two-pack, indicating a potential avenue for growth and increased sales volume. In terms of funding, InvisiPlug had invested approximately $70,000 into the company to date, presumably from personal savings or early-stage investments.
The company’s structure and organizational setup were not explicitly detailed in the transcript, but it can be assumed that Mike Barzman and Bryan O’Connell operated as co-founders and likely held key leadership positions within the company. As a startup, InvisiPlug was likely leanly structured, with the founders involved in various aspects of the business, including product development, marketing, and sales.
The Negotiations:
During the negotiations for InvisiPlug, the co-founders Mike Barzman and Bryan O’Connell faced a mix of skepticism and interest from the Sharks. They began by pitching their product, which aimed to seamlessly integrate surge protectors into hardwood floors, thereby solving the aesthetic issue of unsightly power strips. Despite receiving positive feedback on the product’s innovation, concerns arose about its market potential and valuation.
Lori Greiner and Robert Herjavec both made offers, with Lori proposing $125,000 for 10% equity, along with a royalty structure of $1 per unit until her investment was recouped, followed by $0.25 per unit in perpetuity. On the other hand, Robert offered $125,000 for 25% equity, without any royalty. The negotiations intensified as the co-founders attempted to secure a deal that aligned with their vision for the company’s growth. They sought to negotiate the terms with Lori, expressing concerns about the royalty percentage. However, Lori stood firm on her offer, emphasizing the protection she sought for her investment.
Ultimately, the negotiations concluded with Mike and Bryan accepting Lori Greiner’s offer. This deal provided the necessary funding for InvisiPlug’s expansion while also benefiting from Lori’s expertise and network. Despite facing challenges and tough questions from the Sharks, the co-founders successfully secured a deal that positioned their company for future success.
