Revolights – Bicycle Lighting System
DEAL
EPISODE SUMMARY
🕓 Air Date: March 7, 2014
Asking For:
$150,000 for 10%
Investor:
Robert Herjavec
Deal:
$300,000 for 10%
PRODUCT SUMMARY
Revolights are intelligent LED rings that mount to bike wheels, synchronizing with the bike's speed to create forward-projecting headlights, rear-facing brake lights, and increased side visibility, aiming to reduce nighttime car-on-bike collisions.
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Background Story
Revolutionizing bike safety, Revolights emerges from the bustling tech hub of San Francisco, California, founded by Kent Frankovich, a mechanical engineer with a passion for innovation. Kent’s journey towards creating Revolights began during his time at Stanford University’s lab, where his daily commute illuminated the need for better bike safety solutions. Frustrated by the inadequacies of traditional bike lights and inspired by his background in engineering, Kent embarked on a mission to revolutionize bike lighting systems.
Drawing from his experience as a mechanical engineer, including stints at prestigious institutions like NASA’s Jet Propulsion Lab, Kent Frankovich brought a unique perspective to the challenge. His vision was clear: to design a bike light that not only illuminated the path ahead but also addressed the critical issue of side visibility, a leading cause of nighttime car-on-bike collisions. The light bulb moment came to Kent while navigating dark patches on his evening rides home, where he realized the conventional approach to bike lighting fell short in providing comprehensive visibility.
Determined to create a solution that surpassed existing standards, Kent set out to develop Revolights – intelligent LED rings that sync with a bike’s speed, casting forward-projecting headlights, rear-facing brake lights, and significantly enhancing side visibility. Kent’s journey from mechanical engineer to bike safety advocate showcases the power of innovation driven by real-world experiences. His commitment to improving bike safety, coupled with his technical expertise, laid the foundation for Revolights to become a game-changer in the cycling industry, promising safer rides for cyclists worldwide.
The Product
Revolights revolutionizes bike safety with its innovative design and functionality. Consisting of intelligent LED rings that mount onto bike wheels, Revolights synchronizes with the bike’s speed to provide a comprehensive lighting system. The forward-facing headlights illuminate the path ahead, ensuring visibility in low-light conditions, while the rear-facing brake lights alert motorists to the cyclist’s presence and actions.
Additionally, Revolights significantly enhances side visibility, addressing a critical safety concern often overlooked by traditional bike lights. One of Revolights’ standout features is its ability to adapt to different speeds, ensuring optimal lighting coverage regardless of the rider’s pace. This dynamic lighting system not only increases safety but also enhances the overall riding experience, allowing cyclists to feel more confident and secure on the road.
Revolights are available for purchase online, with options to buy individual sets for front or rear lights or a complete set for both. Prices range from $139 for individual sets to $229 for the full set, providing flexibility for cyclists with varying needs and budgets. With its cutting-edge design and proven effectiveness, Revolights offers cyclists a premium solution for nighttime visibility and safety, promising peace of mind and enhanced riding enjoyment.
How It Went
The company’s position before Shark Tank
Revolights has demonstrated promising growth and market traction since its inception, with a strong position in the bike safety industry. With $600,000 in sales within the first 12 months, primarily through online channels, the company has showcased significant demand for its innovative product. Although not yet profitable, Revolights has proven its ability to capture market interest and drive sales. The company’s strategic partnerships play a crucial role in its growth trajectory.
Revolights’ customer base primarily consists of cycling enthusiasts and safety-conscious riders seeking cutting-edge solutions to enhance their biking experience. The company’s target demographic includes urban commuters, recreational cyclists, and bike enthusiasts who prioritize safety and visibility during nighttime rides. In terms of funding, Revolights has sought investment to fuel its growth and innovation initiatives. Kent Frankovich, the co-founder, pitched to the Sharks on Shark Tank seeking $150,000 in exchange for 10% equity in the company.
Regarding financial health, Revolights has not yet achieved profitability but continues to invest in research and development, marketing, and scaling operations. The company’s available capital includes the $300,000 investment secured from Robert Herjavec, which will be instrumental in driving future growth and expansion efforts. As for the company’s structure, Revolights likely operates as a privately-held corporation or LLC, with Kent Frankovich and other co-founders holding significant ownership stakes. The Negotiations:
The Negotiations:
The negotiations for Revolights on “Shark Tank” unfolded with multiple sharks expressing interest in the innovative bike safety product. Kent Frankovich, the co-founder, initially sought $150,000 in exchange for 10% equity in the company. Robert Herjavec made a generous offer, proposing $300,000 for 10% equity, effectively doubling the requested investment. However, Kevin O’Leary presented an alternative deal, offering $150,000 in exchange for a 7% royalty until his investment was recouped, followed by a 1% perpetual royalty.
Despite the attractive offers, Kent expressed concerns about the cash flow implications of the royalty deal stifling the company’s growth. Ultimately, Kent chose to accept Robert’s offer, valuing the investment and potential strategic partnership over alternative structures. Mark Cuban raised objections to the company’s valuation, criticizing the perceived lack of profitability and high valuation. This sparked a heated exchange, with other sharks defending Kent’s decision to seek investment and the potential value of partnerships beyond capital.
In the end, Kent’s decision to accept Robert’s offer highlighted the importance of securing capital and strategic partnerships to drive Revolights’ growth and expansion efforts. The negotiation process showcased the sharks’ differing investment strategies and highlighted the challenges faced by entrepreneurs in navigating valuation and funding discussions.
